Shelter in place

 

Mr. Market giveth. He taketh away. Robo-advisors crashed. Stock picking cowboys suddenly wish they weren’t. Meanwhile the Bitcoiners need Depends and Toronto realtors are too terrified to release monthly stats. Just another scary day out there in reality.

Fortunately, we have this blog. Safe as your momma’s bosom. Full of puppies, man buns and gender-sensitive people. And free advice, worth every damn cent you paid to come here. So let’s forget the storm out there for a moment or two, and address the tempests within some blog dog hearts.

Here’s Kelly, who wants to talk HELOCs.

“You discuss the downside of moving your mortgage over to this typically misused strategy – and I completely get it.  I have a number of friends who have done this and only ever make the interest payment.  Scary stuff for sure.  My question is: using your numbers you referred to in your recent blog, a $400K mortgage results in a $1900 monthly payment.  In moving this to a HELOC which includes a higher interest rate, if you made those same $1900 monthly payments rather than just paying the interest, is there an upside?  I’m assuming you would pay much less in interest compared to the traditional mortgage structure. Is that so?”

You betcha, Kelly. It is. Mortgages are amortized, so the debt repayment’s spread over the entire am period – typically 25 years – with interest charged in a sneaky, front-end-loaded way. In the early years payments are almost all interest. In the later years, they’re mostly principal. This means the banks get their profitable sauce up front thanks to ‘blended’ payments.

Home equity LOCs are not amortized and have ‘simple’ interest. So if monthly payments are greater than the accrued interest, the extra goes straight off the outstanding loan balance. Thus, a disciplined, reasonable, debt-hating person could retire a HELOC far faster than a traditional mortgage. Do you know any?

“My partner and I are the very infamous moisters you refer to,” say Julie and Dave. “We’ve stayed away from the housing market (in Vancouver) thus far and rent. As such we have quite a bit of savings… $625,000 combined. We both just turned 31, no help from our parents, but are responsible adults who have been working for the past 10 years. Our secret is that we are professionals still living like students. Our combined income is now up around $200k. It may seem like a lot on paper but doesn’t feel like much in this city….

“My question is whether we should we be maxing out our RRSPs? I’m hesitant to contribute the full 18% as I’ve heard from my accountant friend that a lot of people actually have higher incomes once they retire and end up having to pay more taxes. Our TFSAs are maxed. We both have unregistered investments accounts (yes they’re separate accounts :/ ). Roughly $180k in RRSPs and $180k in non-Registered combined. We also have $110k sitting HISA, if and when the housing market declines. What is your take on this should we be maxing out our RRSPs?”

Yes. Simple logic: RRSPs are no longer for retirement, but tax-shifting. This is the gig economy. People barely turned 30 will likely be changing jobs, shifting employers, taking time off for babies, career training or personal sanity. If you put 18% of your income into these vehicles now, at your income level, the tax savings will be substantial and the money swells tax-free. Then melt down some of it during a mat leave, sabbatical or a layoff, withdrawing at a far-lower tax rate, effectively reducing your lifetime costs.

You’re right about higher taxes later. People with million-dollars RRSPs converting to RRIFs often end up being pissed-off 72-year-olds, forced into a higher marginal tax rate by the extra income. This is why RRSPs should be viewed as a tax-shifting tool, while the TFSAs become the primary retirement vehicle. You can each have a million-buck tax-free account, and still collect the wrinklie pogey! Revenge.

“I am hoping you can help or point me in the right direction,” says Caleb, 34, in Calgary, “I left my health care position with all the “amazing benefits and pension” that goes along with it because it was killing me (mentally and physically). I have 9.7 years of pensionable service which leaves me with this according to a letter I just received: Pension commuted value: $160,477.36, Excess contributions: $10,724.15

“It says that the total value of my benefit entitlement exceeds the maximum tax sheltered transfer value. Considering I had no choice in how much I contributed that is certainly something I never expected. The letter from my pension plan indicates I have 2 choices: take monthly payments of $1221.94 when I retire, or transfer $131,968.98 to a LIRA, receive a lump sum payment of 28,508 plus the excess contribution amount stated.

“Help. What do I do? Of note in case you are wondering as of 2017 I had 42,712 in RRSP room.”

And you wonder why people despise government workers, Caleb? Sheesh. Ten years of being paid, and you walk away with another $170,000. Well, the answer is a non-brainer: take the commuted value, not the future monthly payment. After all, you have three decades until retirement, enough time for this money (properly invested) to grow to be well over $1 million.

In fact, almost always take the cash instead of the monthly payment. (a) This become money controlled by you, not some unknown pension administrator. Control is good. (b) There’s a reasonable chance you can grow it faster than the plan, which has more regulatory constraints and is run by guys devoid of personalities (accountants). (c) Three decades is a long time and your plan’s benefits could be reduced by a future Albertan government trying to get over the NDP’s legacy. (d) If you croak the money becomes the property of your family, instead of being lost. (e) You control your own tax situation by withdrawing money as you need it, as opposed to a monthly pension cheque taxed at source.

Take the money and run, Caleb. But we still hate you.

Now, about the stock market? All you need to know is here.

208 comments ↓

#1 conan on 02.05.18 at 5:47 pm

if we get a similar trading day tomorrow, one has to ponder the possibility of a large correction.

For some people, let it ride does not work.

Know your client!

https://www.youtube.com/watch?v=D-0WVOSSX0A

This correction is absolutely needed. Valuations are coming back into line and the economic/corporate fundamentals are good. – Garth

#2 Pathetic PhD on 02.05.18 at 5:52 pm

Wow you called it

#3 common sense on 02.05.18 at 6:00 pm

Today’s action was peanuts…

Talk to me when we are down 50% to reality.

A few dead cat bounces to keep the herds at bay, then let’s see the drop.

Keep cash ready, it’s going to be a lovely sale on most everything.

#4 The Revenant on 02.05.18 at 6:02 pm

Memo to Staff & Students of Revenant High School:

Would the kiddie Congress please OK the revised debt ceiling* before Thursday, in case this other $hit-show gets out of control. Custodian Powell already has his hands full.
A reminder to Mr. Powell to please check the circuit breakers and make sure they’re working before tomorrow morning’s auditorium. The Flying Wallendas will be performing as scheduled.

*“This has turned into an s-show for no good reason, and the only way out of this thing is to grow up a little bit — and I think that’s going to happen,” Sen. Lindsey Graham (R-SC).

#5 CJBob on 02.05.18 at 6:03 pm

#11 Smoking Man on 02.04.18 at 3:13 pm
Expect a huge rebound in the morning. No reason for the market to be selling off. The effects of lowering of personal and coporate taxes hasen’t even hit the engine yet.
____________________
Yeah, cause markets aren’t smart enough to have already factored that in. 1100 point loss. You and Mark. I’ll take your opinions and do the opposite. Like George Costanza.

#6 nick on 02.05.18 at 6:04 pm

RIP BITCOIN

RIP WEED

RIP US STOCKS

RIP HOUSING???

#7 VancouverRefugee on 02.05.18 at 6:06 pm

Toronto realtors aren’t too afraid to release stats, just busy cooking up some more frankenstats and fake news!

#8 saskatoon on 02.05.18 at 6:06 pm

garth, you seem flustered.

blowing off the biggest intraday drop in dow history…then linking to your own old blog post?

very interesting.

Why should I wrote the same drivel two days in a row? Nothing changed. – Garth

#9 Jungle on 02.05.18 at 6:07 pm

Influenza has a Lamborghini?

What kind of wax does he use During Super Bowl?

Dow sheds over 1100 points , Bitcoin crashing, what’s next?

#10 EP on 02.05.18 at 6:07 pm

Quoting from my last post and link last night (which looking back turned out to actually be optimistic):

“…Based on these criteria, the S&P500 does meet all requirements for a parabolic condition.

Timing a parabolic move as to when it will end is near impossible. When these moves end, they tend to do it abruptly and harshly. Every parabolic move in history had a nasty ending.
A market that goes parabolic does not have to crash immediately. A parabolic move can persist beyond any logical measure, but the longer it lasts, the more vicious the subsequent crash.

The market is certainly in a parabolic state. How long it will last is anyone’s guess. Historically, the ends of parabolic moves are marked by the index moving below its 5-month moving average.

That level for the S&P500 is currently at 2,655

* * *

S&P today, as we speak: 2620

…does not mean that it will not go back up soon, but what was hard to imagine yesterday, it happened today. Waiting for a reversal confirmation soon…

#11 Reality is stark on 02.05.18 at 6:08 pm

Rumour has it that pre-sales for condos are dead now in GTA. Developers can no longer get financing. This is going to be a bloodletting.
There are a lot of negative cash flow speculators with many properties who are about to become insolvent.
All those Toronto image is everything people about to get crushed living beyond their means.
It is only when the tide goes out that we find out who has been swimming naked.

#12 TheSecretCode on 02.05.18 at 6:08 pm

Credit Union business up 20+%…stay tuned for the 3rd installation of trying to contain broke borrowers being turned away by the big banks at present because they cannot pass the stress test yet still being able to find someone to lend them money.

But first, what is really going to break Canadian RE is more interest rate increases…then comes the job loss…and maybe add some fuel to the fire with a stock market write down side kick to the head.

NDP measures that are already baked in for BC RE out in 2 weeks…

Meanwhile foreclosures are being kept hush, hush in BC right now as the end of the line for some who have been given way to long to live in their places are getting the boot.

Get ready for the globally coordinated plan out of Davos this year.

#13 The Boulder on 02.05.18 at 6:09 pm

Any inside, why Treb didn’t publish data today? They are also taking the sold price information issue to Supreme Court. Information sharing has been key change in many industries. It is always in favour of overall market. Hope the Supreme Court will keep the information open.

#14 TEMPLE on 02.05.18 at 6:09 pm

I wish you would quit being disingenuous about this topic, Garth. It’s dog whistling at its worst:

And you wonder why people despise government workers, Caleb? Sheesh. Ten years of being paid, and you walk away with another $170,000.

Yeah, he has $170000 because he PAID into his plan for ten years. Probably, if he has a decent salary, he’s coughing up at least 10-12k a year into that plan. What do you think a “stock picking cowboy” (like me) would have after ten years in the stock market with contributions like that? Don’t answer, it’s a rhetorical question: basically, a lot more than $170000. Even your anemic balanced portfolio would crank out better returns. Caleb got slightly ripped off, and you know it, he’s just had the benefit of enforced investing.

But, you already know all this.

There’s a reasonable chance you can grow it faster than the plan, which has more regulatory constraints and is run by guys devoid of personalities

Exactly. Every time someone says “gold plated pension” about civil servants, they just look petulant. You know what gold plated is? It’s junk. You really mean “solid gold”, but it isn’t. The civil service just has a reasonable pension. Pension envy is just sour grapes after years of voting for conservatives who gave rich dudes a tax break while everyone else lost their private sector pensions.

#15 akashic record on 02.05.18 at 6:11 pm

“Termination Event” Arrives: Traders Panic As XIV Disintegrates -80% After The Close

XIV – The Short VIX ETF – after its relentless diagonal move higher as one after another Target manager sold vol for a living… just disintegrated after-hours, down a stunning 81%.

https://www.zerohedge.com/news/2018-02-05/it-traders-panic-xiv-disintegrates-after-close

Financial genius probably consulting feverishly the constitutional lawyer for advice.

#16 Smoking Man on 02.05.18 at 6:12 pm

What?

We had a huge spike in the morning. As in ever Monday morning when you have a huge sell off the precious Friday. That one was in the bank.

Johnneyboy so read the link I supplied. And judging by your reaction your cool with school administering hormone blockers on children without parental knowledge or consent.

Oh boy.

#17 Happy Housing Crash Everyone! on 02.05.18 at 6:12 pm

Release the numbers you dirty SHYSTERS. Why are you afraid? Oh you DIRTY stupid filthy SHYSTERS haven’t finished your spin/manipulation? I hate you useless POGarbage. You really are USELESS to society and add ZERO value. You know it and Happy Housing Crash knows it.

#18 FOUR FINGERS WATSON on 02.05.18 at 6:13 pm

Just another scary day out there in reality.
……………………..

This is Canada. Reality is optional.

#19 MF on 02.05.18 at 6:14 pm

With regards to the current stock market, I still don’t hear or feel any fear. The last two times this happened (that I was paying attention) was in 2014/15 when everyone thought the bull was done because commodities were in the ditch and China’s market collapsed. We also had an Ebola scare and (another) EU crisis.

I don’t feel any of that fear this time, which leads me to believe this is correction will be minor and short lived.

MF

#20 paracho on 02.05.18 at 6:16 pm

Once again, great advice from Garth !

In June 2016 I finished the mortgage agents course and passed ! It was quite simple . But I never got into it as I saw how saturated it has become and all the brokerages wanted to hire on the spot with weird commission splits .
I still have until June to get in if I want but it is unlikely .
I bumped into a few of my fellow classmates who tell me how slow it is since B20 and how slow it already was .
One woman who is now a broker told me the following disturbing fact off the record . “ Over 90% of our applicants should not get the mortgage or deserve the mortgage under both old and new criteria “ Her words, not mine in this low quote.
She went on to say how they work with the clients to help fill out a betterlooking application and then work with the lender to help the borrower receive the mortgage by greasing their palms later .
If this is true , I find it disturbing and can see a major problem later on with 3 or 4 rate hikes . Will there be a major scandal ? Investigations ?
This is quite disturbing .

#21 The Top on 02.05.18 at 6:18 pm

A friend of mine says he saw a dinosaur on this site buying cryptocoin, not sure what he is smoking but that is a sell everything sign.

#22 Happy Housing Crash Everyone! on 02.05.18 at 6:19 pm

#12 TheSecretCode

you stupid SHYSTER. You think the credit unions are going to lend to those who couldn’t qualify for a mortgage from a bank and just say OK we will give you one? LOL they will pay a premium interest rates which means they can borrow less . With less people able to borrow and falling prices means no more speculators which mean the CRASH will only get worse. housing is FINISHED. The GTA will CRASH for YEARS to come. The stock Market is where it’s at right now. Corrections are healthy and we are having one now.
Happy Housing Crash Everyone! The housing market is FINISHED in the GTA. Its FINISHED you dirty stupid uneducated stupid lying POGarbage SHYSTERS.

#23 For those about to flop... on 02.05.18 at 6:20 pm

Recent Sale Report/ Realtor Assistance Needed.

This house in Richmond that was on the market for less than purchased for ,sold two weeks ago.

Now let’s see if I can get one of my realtor buddies to cough up what it went for.

Could be a useful yardstick ,as I have several cases at that price point ,in that city trying to make an escape…

M43BC

4260 Coventry Drive, Richmond paid 2.83 ass 2.58 asking 2.79

Feb 21:$3,180,000
Aug 23: $3,060,000
Change: – 120000.00 -4%

https://www.zolo.ca/richmond-real-estate/4260-coventry-drive

https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDA1WExSQQ==

$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Feel free to make a donation.

Flop For Fox Fund…

http://www.terryfox.org/get-involved/ways-to-give/

#24 Infidel on 02.05.18 at 6:22 pm

The Dow has the worst day in its history.
The White House is “concerned” about the fall on US stock markets after the Dow Jones dropped by 1,175 points!!
Yet Mr. Turner prefers to dwell on HELOCs and RRSPs.

OK. Here.
This is not a gift.
This is your survival guide:

https://www.uncommonwisdomdaily.com/7-tips-survive-next-bear-market-23835

You’re welcome.

It was not the worst day. But that is the worst link ever. – Garth

#25 TheSecretCode on 02.05.18 at 6:23 pm

Davos agenda 2018 for execution:

1. Ban crypto and watch what a crypto market does without the Fed backed plunge protection team.

2. Write down the markets via tightening.

3. Continue tightening until it looks like the world is going to end…

4. Have the plunge protection teams ready globally for a controlled crash…

5. Start an inquiry into how 30 million jobs were erased due to financial market recklessness…

6. Pray for Canadian RE.

#26 Paully on 02.05.18 at 6:26 pm

Mortgage interest is not charged in a sneaky, front-end-loaded way. It is charged in a mathematically consistent front-end-loaded way. There is nothing sneaky about it.

And most people have no idea. Sneaky! – Garth

#27 MF on 02.05.18 at 6:28 pm

#3 common sense on 02.05.18 at 6:00 pm

I too hope this market gets the destruction it deserves, but unfortunately I don’t think this is it. No fear. EVERYONE is complacent and just believes the upward trend will just resume in a few days. After years of manipulation and “stimulus” this is the result. Total complacency where no one believes there is any shift in paradigm occurring (normalization of interest rates).

We also see people grasping for straws. Bitcoin was one. Marijuana is another. I think both of these attract the same type of investor: naive, speculative, retail, and young. And we just know the MJ “investors” include legions of pot heads and drug addicts that voted T2.

MF

#28 TheSecretCode on 02.05.18 at 6:29 pm

Insider update from TREB:

Are systems have melted down…we are trying to resolve this issue of the minus sign in front of all of our double digits…

***Stay Tuned***

#29 Ex Pat Canuck on 02.05.18 at 6:38 pm

The action in the markets was not unexpected by those who pay attention to such things. There is a long, long way down before the market finally corrects itself…how low it goes and when it actually falls down to it’s lowest point before it starts going up again is a guessing game. Could be by the end of this week, could be at the end of this year, or later. But it’s been a house of cards for many years now, and it is going to hurt a whole lot of folks who aren’t paying attention by the time all is said and done. Watch what happens in the gold sector…especially in the gold miners. Lot of upside there but it’ll waffle about at current valuations for a while before taking off.

#30 MF on 02.05.18 at 6:40 pm

#15 akashic record on 02.05.18 at 6:11 pm

I follow XIV. It basically tracks the S&P 500 with about 2 or 3 leverage.

It measures delusion more than anything else and is up something like 400% or so in a few years. 80% drop should bring it to reality at least somewhat.

In other news UVXY was up 66% today. This thing is a trader’s dream…..if you are on the right side of the trade with it.

MF

#31 Toronto Dollar backed by Feminism and Girl power! on 02.05.18 at 6:40 pm

The Toronto Dollar will challenge the US hegemony by protests in Washington DC against Trump. The Toronto Dollar will become the reserve currency of the world. Take that, America! Women rule, Trump’s a loser!

#32 michael on 02.05.18 at 6:41 pm

“Thus, a disciplined, reasonable, debt-hating person could retire a HELOC far faster than a traditional mortgage. Do you know any?”

Ohai.

Working in a non-9-5 trade and having non-constant albeit reliable income I used a HELOC to make the mortgage payments. All expenses came out of the HELOC and all (ALL) paychecks went into the HELOC. Every time the mortgage came up (we used 5 year fixed terms for predictability) the amortization period was squeezed as short as we could manage. Paid it all off liketty split and have been mortgage free for years except for the HELOC which we still use as a buffer. Our CA thought we were mad at first and wondered what the bank was thinking. We win.
Love the blog (Hi Garth!)

#33 Al on 02.05.18 at 6:43 pm

Dont’ forget that this person likely paid $60,000+ over the course of those 9.7 years into that pension via mandatory contributions. Compound that and it’s a lot closer to the “free” 160k you are taking about.

Where did I say ‘free’? – Garth

#34 Larry B on 02.05.18 at 6:44 pm

Being almost as old as GT and having read most of his early books I will stick with the topic of the day.

First house bought in the GTA (barely) with a $100K mortgage @11% fixed for 10 years 25 year amort. (Jan 88). Yes, we could have gotten a cheaper rate with a shorter term but choose surprisingly well.

The one smart thing we did was print out an amortization chart. To our amazement, for every dollar we put down extra on the mortgage, we saved seven. This was a no brainer for us. put all extra cash into the mortgage which we paid off in just over 5 years. In the mean time, house prices soared and people were ecstatic over how house rich they were. (wealth effect) Soon, mortgages reached 21% or higher, people were losing their homes all over our street. The party did not last long. History repeats and yes, there are still people that will put their immediate satisfaction on hold for a more prosperous future. We need some basic financial education for our younger people. btw, I like the wealthy barber better….lol

#35 TheSecretCode on 02.05.18 at 6:44 pm

Don’t worry about the after hours “Termination Event” currently happening with the VIX short in the after hours.

It is only triggered if the daily percentage drop exceeds 80% and it is currently at 90%…and the biggest move ever recorded.

All good.

#36 Bob Dog on 02.05.18 at 6:45 pm

I broke the rules and sold almost all my equities back in Oct-Nov keeping only bonds.

I was worried I made a big mistake watching the last 3 months of bitcoin like gains. Today I was vindicated like trump.

When the smoke clears I will be back in for the win. The advantage of getting older is you can look at recent history and say… Hmmm Ive seen this movie before.

#37 For those about to flop... on 02.05.18 at 6:45 pm

Recent Sale Report/ Realtor Assistance Needed.

A couple of weeks ago a poster named Gary Smith pointed out three houses in Delta that were Pink Snow,and now a second of the three has found a new owner.

Let’s try and find out what it went for.

Paid 1.02 July 2017

Sold January 21st 2018 for ???

Could be a Pink Draw,but people want to know the score…

M43BC

5295 CHAMBERLAYNE AVENUE, Delta, British Columbia V4K4C3
January 2018-listed for 1,098,000
July 2017-sold for 1,028,000

https://www.bcassessment.ca/Property/Info/QTAwMDA1VlkzMg==

https://www.zolo.ca/delta-real-estate/5295-chamberlayne-avenue

$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Feel free to make a donation.

Flop For Fox Fund…

http://www.terryfox.org/get-involved/ways-to-give/

#38 akashic record on 02.05.18 at 6:48 pm

What will it take to get the US rate hike idea revisited?

#39 Sam the Sham on 02.05.18 at 6:48 pm

#22 Happy Housing Crash Everyone!

Now, now… We all know what happens when you stop taking your medication. You will feel better if you go back to taking you pills. Ask the nurse to help you.

#40 Failed Forex Trader on 02.05.18 at 6:48 pm

Anyone who offers training in Forex is themselves either a failed Forex trader or a low-caliber trader at best.

Anyone making serious money trading has no time and no interest in training others.

Anyone making market direction calls either works for Renaissance Technologies or just someone blowing hot air.

#41 David on 02.05.18 at 6:50 pm

Caleb can transfer the taxable amount in excess of his LIRA portion directly into his RRSP up to his available RRSP room. I did that previously.

#42 LivinLarge on 02.05.18 at 6:52 pm

“And most people have no idea. Sneaky! – Garth”…if true then most people are dumb as stumps.

A few decades (before amortization calculators came on every PC and with bubble gum too) ago you had to ask for the bank to give you one but for quite some time now an amort. schedule is just a part of the package you get at signing and sometimes at renewal. So, if most people don’t read their documentation we can only blame consumer stupidity. That doesn’t necessarily mean it’s not true too.

#43 Guy in Calgary on 02.05.18 at 6:52 pm

Context is important on days like today. We are only at early(ish) December levels as of now. Having money in US equities is not equivalent to a license to print money, who knew!? Bond yields went down so they seem to be doing their job.

If you can’t handle a 5% – 10% correction get the hell out of equities, as simple as that. I’ve noticed in recent meetings when asking compliance questions, more and more people have been increasing their risk tolerances and against my advice, going into more aggressive funds.

My phone was not quiet today.

#44 Almontage on 02.05.18 at 6:55 pm

We really old wrinklies didn’t have that terrific TFSA in our working lives so we had to make do with the RRSP. I have always worked where there was some sort of Registered Pension Plan but in the 70s and 80s I moved round a bit and never got vested. It wasn’t a 2 year slam dunk to get vested back then.
One company I worked for had a non-contributory plan that you needed to be in for 10 years to get anything (I wasn’t.) I got nothing and it cost me a fair bit of RRSP headroom in the bargain. At least the other guys gave me back my contributions.
The last half of my career I was in a decent RPP which pays me something today. My RRSP was always maxed and now (well managed by Turner Investments) it provides us with inflation protection and possible increased living costs as we get into our dotage.
So it hasn’t been all sunshine lollipops and roses in the pension dept. even if you did have a pension plan back in the day. And no I am not in a higher tax bracket than when I was working.

#45 Guy in Calgary on 02.05.18 at 6:56 pm

#27 MF on 02.05.18 at 6:28 pm

Young people with loads of time on their side being more aggressive with their investment selections? The horror.

And just so you know, everyone is in on the pot/BTC train, not just us youngins. I don’t understand how boomers call us poor and lazy and then say we are responsible for being market makers in pot and BTC. Make up your minds.

#46 R on 02.05.18 at 6:56 pm

Good day for me. Bought lots of s&p 500 ETF. Hopefully more discount tommorow.

#47 these flop reports are easy! on 02.05.18 at 6:58 pm

Why they didn’t just make it $1,888,888 is beyond me …

1038 E 51st Avenue, Vancouver

Nov 29:$1,888,000
Feb 2: $1,888,800
Change: 800.00 0%

Sales History (last 3 years)
11-Apr-2017 $1,850,000

#48 Nonplused on 02.05.18 at 7:01 pm

If your plan is to pay off your mortgage or HELOC as fast as you can I think you should take the one with the lowest interest rate. The last mortgage I had was some years ago now but it was a 5 year term that allowed over-payment of up to 20% of the original amount per year without penalties. I don’t know if they still offer those kinds of terms but 20% is a pretty big number for most people. You can also do the bi-weekly thing which speeds it up as well.

My thought is it wouldn’t matter much whether you have a mortgage or a HELOC if you make the same payments and have the same interest rate for either option. A HELOC will front end load the interest in the same manner a mortgage does because they both calculate the interest on the outstanding balance. The main advantage of the HELOC is that if you are expecting to come into some serious cash you can pay it off whenever you want. But for most people, unless mom is about to kick the bucket and leave you some serious inheritance, that option probably doesn’t mean much. So I would take a mortgage over a HELOC if the interest rate is lower. Even if your mortgage does not allow over payment you can still drop cash on it every time it comes up for renewal, which for most people is only 1 or 2 years to wait.

Of course all of that is only for people who plan to pay off their mortgage as fast as possible, and those types are hard to find these days. Which makes sense in an era of interest rates that are below real inflation and skyrocketing house prices. Why pay it off when the money is practically free? When I had my mortgage 5% was a good interest rate and inflation was low, so since I had to pay that 5% out of after tax dollars paying of the mortgage was competitive with other investments in terms of return/avoided cost. It has been an unusually long time since that was the case.

Unfortunately, just like alcohol makes for a better party but creates a lot of hangovers, ultra low interests rates have done exactly what they were intended to do: Discourage saving and encourage people to take on more debt. But like binge drinking there will be a price to pay at some point when the morning finally comes and interest rates rise. If that day ever comes, the cost to carry the debt will go up, leaving less money to pay the principle down and trapping people in an unfortunate predicament. If you’ve planned properly and invested the money you could have used to pay down debt then you will be ok, sell the investments and knock down the debt. But I’m guessing most people didn’t do that and all they will see is rising interest expenses.

#49 mark on 02.05.18 at 7:03 pm

I get it you can take your marbles all away.
If you don’t like the color of them?

#50 gb on 02.05.18 at 7:04 pm

#14 TEMPLE:

Thank you for nailing that.

#51 45north on 02.05.18 at 7:05 pm

Happy Housing Crash Everyone:


TheSecretCode
you stupid SHYSTER. You think the credit unions are going to lend to those who couldn’t qualify for a mortgage from a bank and just say OK we will give you one?

who are you calling him stupid? A shyster? What do you know? Answer – nothing.

I read his posts carefully. I believe him. In reporting on this blog, he is taking some risk. We need to give him some respect.

#52 conan on 02.05.18 at 7:07 pm

It was not the worst day. But that is the worst link ever. – Garth

No, it was me with the worst link ever.

1) cat video strike one
2) Adele strike two
3) 3 + mins strike three

You let it go for some reason. Boxing day rule I guess.

#53 Tony on 02.05.18 at 7:09 pm

I’m following what rigged daily stock patterns and un-rigged stock market daily patterns would look like. Today the pattern wasn’t that of the past if you join all the 15 minute intervals and try to match that to a daily index chart from the past year or two. I told my brother in the morning I haven’t seen that trading pattern in decades. I’m going to be following like a chess player the 15 minute interval moves and I’m looking for a big up day this Thursday. If you day trade and have day traded for decades right off the bat this morning most would have realized the indexes weren’t trading like they have the past couple of years were every daily chart looks alike.

#54 Cottingham a bargain on 02.05.18 at 7:10 pm

I will tell you one thing that is certain. There is no utility in owning a financial asset other than watching it rise in value . The moment that stops .. well then you get days like today and last week

The difference with RE with land is that the utility never stops even with falling prices . RE can be lived in , rented out and with land a myriad of options exist from rezoning to growing food. The tangible nature of it , never in question.

Call me a brick licker, house humper or whatever you like but go ahead and try your luck at an intelligent rebuttal at this immutable fact.

#55 TurnerNation on 02.05.18 at 7:15 pm

In case of Rapture this trading desk will be manned.

#56 Long Branch Apprentice on 02.05.18 at 7:16 pm

Who else is up on USDCAD?

Look out if US 10yr hits %3.

Every market has 2 sides.

Better start paying attention SCM.

#57 FOUR FINGERS WATSON on 02.05.18 at 7:16 pm

So the DJI dropped off 4.6%, not a big deal compared to the 87 crash of 20 + %. No big disaster coming, carry on……

#58 Bottoms_Up on 02.05.18 at 7:19 pm

To the 200k family living like students–you won’t live forever. One day you will realise this. My advice is to live a lifestyle that brings you comfort and happiness.

RE: Caleb, lets not forget $85,000 of his pension was contributed by him, off his weekly salary. It’s not just a handout.

#59 Tony on 02.05.18 at 7:22 pm

For anyone who looks at figures or numbers the day the market (DOW) lost 666 points is almost exactly a one-third retracement of the March 09, 2009 low (6,600) to the January high of around 26,600. 26,600 – 6,600 = 20,000 divided by 3 = 6,666.

#60 PGer on 02.05.18 at 7:23 pm

No need to panick folks. That is, if you are actually a long-term investor. This is just the fast money moving about, eating a bunch of nervous-nelly retail investors’ stocks and money. Happens all the time.

Fundamentals are good right now, especially in the US. Go have a scotch and relax.

#61 CJB on 02.05.18 at 7:27 pm

I was on holidays and read about the big drop in the Dow on both Friday and Monday. I got kinda nervous and checked my balanced portfolio, it’s down a little but it’s hardly noticeable. Should a guy be looking to buy soon or wait for some more negative volatility?

#62 Ruff on 02.05.18 at 7:30 pm

2018 year of the Dog my Asian buddies say bad year for real estate. Sell now

#63 Lifexprt on 02.05.18 at 7:32 pm

Just like the 666 intraday in march 09 was a buy signal, this recent 666 move is the opposite, it will take time but the bumpy road down has begun, for time being a massive green day tomorrow ; )

#64 Loonie Doctor on 02.05.18 at 7:34 pm

The empahsis people keep putting on the points drop makes me chuckle. 1000 points from DOW 26000 is not the same as 1000 points from when it was 15000. It reminds me of Dr. Evil asking for one MILLION dollars ransom.

Still hurts though after such a long run without a correction. The memory of pain fades with time, but we just got reminded. A bit of pain is healthy because it reminds us to not do stupid shit. I still wish I had a better leading indicator of impending pain. In my real life the words “Here, hold my beer” usually works well.

#65 Linda on 02.05.18 at 7:34 pm

Caleb must have been making quite the salary. After 10 years of paying into my DB pension plan, my commuted value was WAY lower than what he claimed his letter said he’d get & I referred to my annual statement of benefits as ‘slit my wrist’ time. As in, hello, if you took your pension today you’d receive $20 per month….. at age 65. I didn’t see anything like livable monthly until I’d paid into my plan for 25+ years, then suddenly it went from ‘No way are YOU ever going to be able to live on this’ to ‘Maybe I can retire one day’.

The market pull back isn’t surprising, more that it took this long. I see what is happening as the usual panic, follow the lemmings over the cliff sell off scenario. Emotion, not logic as the underlying fundamentals as outlined by Garth (& others) remain. Economies are building, not falling apart so this current pull back looks like a buying opportunity if one wants to scoop up quality at temporarily reduced prices.

#66 For those about to flop... on 02.05.18 at 7:36 pm

42 these flop reports are easy! on 02.05.18 at 6:58 pm
Why they didn’t just make it $1,888,888 is beyond me …

1038 E 51st Avenue, Vancouver

Nov 29:$1,888,000
Feb 2: $1,888,800
Change: 800.00 0%

Sales History (last 3 years)
11-Apr-2017 $1,850,000

//////////////////

Thanks for the help,I have already shown that one a couple of times.

Can I retire now with my Greater Fool Pension…

M43BC

#67 common sense on 02.05.18 at 7:42 pm

Funny, Gold is doing quite well this year.

$2000 by fall ?

#68 Dead Cat Bounce on 02.05.18 at 7:46 pm

Beware Black Tuesday !!!

#69 common sense on 02.05.18 at 7:47 pm

#56 Long Branch

I’ve been waiting for the right time and dipped my little toe in today.

Let’s see what happens over the next 2 weeks.

#70 Vigo the carpathian on 02.05.18 at 7:47 pm

Hey flop

5295 chamberlayne ave:
Listed Jan 15 1,098,000
Sold 1,085,000.

Imagine when they find out they’ll be paying tolls not for a new bridge but for the right to use the old tunnel…

#71 Timmy on 02.05.18 at 7:47 pm

When ‘Gentrification’ Isn’t About Housing

https://www.nytimes.com/2018/01/23/magazine/when-gentrification-isnt-about-housing.html?em_pos=small&emc=edit_up_20180205&nl=upshot&nl_art=3&nlid=73776278&ref=headline&te=1

#72 crowdedelevatorfartz on 02.05.18 at 7:52 pm

@#22 Happy Housing Crash Everyone!
“Happy Housing Crash Everyone! The housing market is FINISHED in the GTA. Its FINISHED you dirty stupid uneducated stupid lying POGarbage SHYSTERS.”

++++++
You forgot the Dr. Evil laughter.
Moooo Hooooo Haaaaaa Haaaaaa Haaaaaaaaaaaaa

#73 crowdedelevatorfartz on 02.05.18 at 7:54 pm

@#9 Jungle
“Dow sheds over 1100 points , Bitcoin crashing, what’s next?”
+++++++
Hopefully…..
Real Estate commissions?

#74 akashic record on 02.05.18 at 7:55 pm

#35 TheSecretCode on 02.05.18 at 6:44 pm

Don’t worry about the after hours “Termination Event” currently happening with the VIX short in the after hours.

It is only triggered if the daily percentage drop exceeds 80% and it is currently at 90%…and the biggest move ever recorded.

All good.

===

Jamie “financial genius” Dimon is about to make a statement demanding to ban it.

Unless, of course “…there is a strong probability of policy makers stepping in to calm the market”, according to his chief quant.

https://www.zerohedge.com/news/2018-02-05/kolanovic-admits-he-was-wrong-says-central-banks-may-step-halt-crash

All good.

#75 Danny on 02.05.18 at 7:58 pm

Garth
Been following your blog for over a year. One thing I noticed is that you are not a hypocrite. What you read is straight forward.

You have been stating that the DOW….is at unreliable highs…

Unlike hypocrite Trump who wants football players not to question law enforcement with a simple knee…while King Trump kicks the FBI (law enforcement) in the head. Why? Because FBI are looking into his families businesses and possibly shady deals.

Our the market profiteers…losing faith in Godfather and Superlative Trump?

Let’s wait a week and see. Bad second day so far.

#76 Reale on 02.05.18 at 8:00 pm

#67 common sense
Funny, Gold is doing quite well this year.
$2000 by fall ?

In your dreams. Won’t happen.

#77 For those about to flop... on 02.05.18 at 8:01 pm

#70 Vigo the carpathian on 02.05.18 at 7:47 pm
Hey flop

5295 chamberlayne ave:
Listed Jan 15 1,098,000
Sold 1,085,000.

Imagine when they find out they’ll be paying tolls not for a new bridge but for the right to use the old tunnel…

////////////////////

Hey Vigo, thanks for that.

Paid 1.028

Sell 1.085

I’m good with calling this one a Pink Draw.

Any info on the Richmond one?

I think that one is Pink Snow,but we don’t know…

M43BC

#78 OttawaMike on 02.05.18 at 8:08 pm

Gotta laugh at all the Smoking Man skeptics here.

He might be a drunken, deplorable but if you’ve been around here for a while his call track record speaks for itself.
A bet on HVI on market opening would have reaped 10% within 30 minutes today.

#79 MF on 02.05.18 at 8:11 pm

#45 Guy in Calgary on 02.05.18 at 6:56 pm

I’m no boomer. I’m 34. Not all of us millennials smoke weed to escape everyday stress. I use exercise as an example. Others read. You get the picture.

The legalization of MJ was nothing but a carrot stick from the Liberals to get the young pot heads to vote for them. All I heard on my Facebook feed when T2 got elected was “free pot” “free pot”. Nothing about the anti business platform, lack of experience etc. It was an appeal to the lowest common denominator and sadly it worked.

Any health of effects of this drug are still under investigation. And that would be for the .2% who are sick and legitimately need it. The remaining people who smoke are just drug addicts using it to “cope” with reality like an an alcoholic uses alcohol. From what I have seen it’s a big gateway drug too.

Before I hear about alcohol comparisons, the differences are people who smoke put everyone around them at risk of exposure through second hand smoke. I smell the stink of weed everywhere now as people get more and more bold. Also, one legal drug is enough. No need for more. And I couldn’t care less about some supposed tax revenue. Try cutting spending instead.

MF

M34ON

#80 Nagraj on 02.05.18 at 8:11 pm

Anybody bleeding from margin calls? Any hedge funds blow up? Everybody’s still all in? Well goodness gracious me, no complaints anywhere. [The stoicism of cryptonaires is astonishing. (“stoicism”)] (cryptoclowns)

#81 Capt. Serious on 02.05.18 at 8:19 pm

The thing about equities is that if the ride wasn’t bumpy, you wouldn’t get an equity risk premium.

#82 Happy Housing Crash Everyone! on 02.05.18 at 8:23 pm

#39 Sam the Sham on 02.05.18 at 6:48 pm
#22 Happy Housing Crash Everyone!

Now, now… We all know what happens when you stop taking your medication. You will feel better if you go back to taking you pills. Ask the nurse to help you.


Have you see the price of Olanzapine???
I had to stop eating it for a month just to buy:
Star Trek: The Next Generation – Season 2 Blu-Ray

#83 ANON on 02.05.18 at 8:24 pm

I don’t feel any of that fear this time, which leads me to believe this is correction will be minor and short lived.

Normal doom fatigue, hopefully acceptance. :)
Yet this is the Pop!

#84 Angry Guy on 02.05.18 at 8:25 pm

Garth,
Why are you allowing comments like #31. You wouldn’t allow racism. Why genderism? Change “women rule” to any other group and they’d be banned. I’m getting sick of this freebee given to women. Hilary has said the same thing– “The future is women” and got a free pass.
I look forward to your reconsideration and removal of that post.

#85 millmech on 02.05.18 at 8:29 pm

A couple of years out, this will look like another great buying opportunity, yet all the people who bought in to the market highs will sell into the lows instead of staying invested. They will then complain about the market being rigged, there is a reason why 99% of the population are not wealthy. Investing is designed to reward those with patience and fortitude who will stay in no matter what and buy the lows.
So many people I know bought back in last year because it was safe and considered themselves to be financial wizards after one year. I bet they are selling now and if the market retracts another 1000 points will sell the rest of their holdings.
Once the market comes back another 30%-40% they will buy back in because it is safe.
Reminds me of 08 when I was buying in like crazy while they were selling at the bottom, they could not understand my enthusiasm for the big price reductions. He who dares wins!

#86 common sense on 02.05.18 at 8:35 pm

#76 Reale

Yes $2K is a reach but am confident it will be higher than where it is now.

$1500 feels realistic.

#87 Bitcoinnaire on 02.05.18 at 8:39 pm

This is all pretty amusing.

“Bitcoin is a bubble”, but apparently so is the legacy boomer securities market.

At least when my magic internet money vanishes, society doesn’t collapse… :3

Bitcoin has shed 60%. The Dow has lost 6%. Get a grip, kid. – Garth

#88 akashic record on 02.05.18 at 8:40 pm

#80 Nagraj on 02.05.18 at 8:11 pm

Anybody bleeding from margin calls? Any hedge funds blow up? Everybody’s still all in? Well goodness gracious me, no complaints anywhere. [The stoicism of cryptonaires is astonishing. (“stoicism”)] (cryptoclowns)

===

Conclusions too early or not following the proper sources?

Credit Suisse Tumbles On Fears Of Massive XIV Loss

https://www.zerohedge.com/news/2018-02-05/credit-suisse-tumbles-fears-massive-xiv-loss

Vol ETF Terminations Begin: Nomura Announces Early Redemption Of VIX ETN

https://www.zerohedge.com/news/2018-02-05/vol-etf-terminations-begin-nomura-announces-early-redemption-vix-etn

#89 ANON on 02.05.18 at 8:50 pm

Better than the SuperBowl:
http://www.sgxniftydowfutureslive.com/index_files/DOWFUTURES.htm
Enjoy.

#90 slick on 02.05.18 at 8:51 pm

The futures market is down tonite as i write this, but interestingly, so is the VIX.
I have been short VXX puts for months, [and wrong], but just kept rolling down. finally late last week I was vindicated.

slick

#91 Trumpocalypse2018 on 02.05.18 at 8:51 pm

Shelter in Place – EXACTLY!!!

Garth has it right!

Today, a market correction leads towards collapse/economic unwinding and chaos.

Each week going forward there will be triggers and calamities. Until the winter Olympics are over.

Then, by about February 28……….this:

https://www.thestar.com/opinion/star-columnists/2018/02/05/donald-trump-and-the-allure-of-a-second-korean-war.html

“Among other things, the U.S. appears to be barrelling toward a nuclear war with North Korea.”

“What else is left but war?”

“Last month the New York Times reported that American troops are being trained across the U.S. for a possible invasion of North Korea.”

“This would involve a limited military attack on the North just to show that Trump means business. But as Cha wrote in the Washington Post, even a limited strike would invite an all-out response from Pyongyang.”

It’s here, people!

Global catastrophe is building now by the day as never before.

PREPARE.

#92 Blessed_Canadian_Millennial on 02.05.18 at 8:53 pm

#48 Nonplused on 02.05.18 at 7:01 pm
If your plan is to pay off your mortgage or HELOC as fast as you can I think you should take the one with the lowest interest rate.

———

Precisely. Though, HELOC does have many advantages in that you can pay as quickly or as slowly as possible. That’s why I have a HELOC and not a mortgage.

As for Julie and Dave, they need to fire their tax guy. If they’re earning $200K combined, this means that at minimum one of them is earning at least $100K. A $10K contribution (at minimum) should be a no-brainer.

#93 TRUMP on 02.05.18 at 8:58 pm

Taking out a HELOC…….To raise cash to buy this crash.

Gonna be rich!!!!!

#94 domain on 02.05.18 at 9:09 pm

I am no advisor, but given the extremes in sentiment all over the place for equities, I would say that this ‘correction’ has a 50% chance of being something much more.

Personally, if I were to try and gauge it in my limited knowledge, I would be looking at what Gold is doing at the same time as the market in general. If it starts to move in the opposite direction in a convincing manner, then you have confirmation of a “run for the hills” type of event.

Anyway, crystal balls don’t exist, but the signs of extreme complacency have been waving in our faces for at least half a year now.

Best of luck.

Experience is the best teacher. Get some. – Garth

#95 Paul on 02.05.18 at 9:11 pm

#39 Sam the Sham on 02.05.18 at 6:48 pm
#22 Happy Housing Crash Everyone!

Now, now… We all know what happens when you stop taking your medication. You will feel better if you go back to taking you pills. Ask the nurse to help you.
————————————————————————————————
I’m not a nurse but if you hold him,I’ll shovel a bunch it,
Lol

#96 Don on 02.05.18 at 9:13 pm

I recently become a government employee, should I transfer my previous DB plan to the government sponsored plan? I still have 15 years leading to my retirement. The commuted value of previous DB is about 300,000$. The good thing about government DB is that it is indexed and provided sort of health benefit after retirement.

#97 Bitcoinnaire on 02.05.18 at 9:14 pm

@Garth

>Bitcoin has shed 60%. The Dow has lost 6%.

But the Black Swan event has just been initiated…

At this time, the DJIA sell-off mirrors the BTC plunge on relative terms. They are both currently testing mid-November values.

Bitcoin is also a much younger asset, with an incredible run-up. Surprisingly robust.

#98 westcdn on 02.05.18 at 9:20 pm

Life is hard. It is even harder when you are stupid – John Wayne (cowboy)

When the tide comes in, it floats your boat. The tide also goes out and I suspect I will soon be seeing naked people as per uncle Warren. It seems VIX based ETF’s are broke and being “terminated”.
https://blackswanalert.com/2018/02/05/vol-etf-terminations-begin-nomura-announces-early-redemption-of-vix-etn/
Termination

One of my favourite financial pundits got caught. A lot of times looking stupid is a result of misplaced trust.
http://ibankcoin.com/flyblog/2018/02/05/credit-suisse-plunges-hours-due-black-swan-event-unfolding-volatility-etns/#sthash.XcZxFI50.dpbs

I wondered how today’s equity only EFTs would fair when the tide went out. I will be taking a close look. Bonds and Preferreds appear to be holding their value although I expect selling pressure on them as margins are called. Tomorrow looks to be another miserable day for a DIY investor but I will be searching for RR Preferreds on sale. I don’t see the point of averaging down on common equities at this time.

Mr Market has a dark side and a woodshed. At least my house seems to be keeping its value. The city of Calgary raised my assessed value by 10% despite a neighbour’s identical house with more substantial renovations selling for 15% less than my assessment. Mind you, the sale occurred 5 months after the assessment was made. I am one of the privileged few to get a residential property tax increase this year. I suspect income by postal code is an assessment factor as there is no point to charging those who can’t pay. Besides, someone has to pay for a wasted Winter Olympic Games bid and keep alive our mayor’s dream of building monuments on the cheap by collecting dimes from the rest of the world.

#99 Chico on 02.05.18 at 9:21 pm

#84 Angry Guy on 02.05.18 at 8:25 pm

Garth,
Why are you allowing comments like #31. You wouldn’t allow racism. Why genderism? Change “women rule” to any other group and they’d be banned. I’m getting sick of this freebee given to women. Hilary has said the same thing– “The future is women” and got a free pass.
I look forward to your reconsideration and removal of that post.

————————————————

I read her post and she just sounded stupid, nothing more, nothing less. Are you trying to limit a stupid woman’s right to post? They are a lot of stupid people, men and women, who would be up in arms over their God given right to say whatever stupid thing they want, whenever they want, to whomever they want, via the internet. These stupid people might form a coalition or some other stupid angry group and come after people like you who try to limit their rights.

Don’t let your anger get the best of you, or you’ll just end up looking…you know……..

#100 MaxBerniersShorts on 02.05.18 at 9:22 pm

What the heck are Julie and Dave saving all that money for, if not to buy a house? Why live in student penury, so you can buy more Ensure when you’re ready to winter in Arizona and aimlessly mill about a golf course with the other oldsters? Live a little.

Too bad they didn’t put $500k of that in a Vancouver condo a few years back. No foreseeable 4% drops in that market!

#101 El Gringo Salado en el Rio Frijoles on 02.05.18 at 9:27 pm

If you put some money into an investment with a constant ROI (interest) and you convert the future value into a uniform series of payments (an annuity) you get the same “sneaky up front loading” of interest as in a mortgage only it’s being paid TO you instead of BY you.

It’s simply due to the fact that you earn/pay the interest on the balance each payment period. In the beginning the balance is large thus so is the interest. In the end the balance is nearing 0 thus so is the interest.

#102 ANON on 02.05.18 at 9:33 pm

At least when my magic internet money vanishes, society doesn’t collapse… :3

The coinybitz bubble was possible only because of all the other bubbles, and it has pushed semiconductors into another bubble of its own. No semis, no civilization, don’t need to be a rocket scientist, almost all of use move bits for a living. So don’t be too sure your bubble is not linked somehow to the others. :)

#103 When Will They Raise Rates? on 02.05.18 at 9:42 pm

Tommorow’s trading action:

https://m.youtube.com/watch?v=E1xqSZy9_4I

Black Tuesday is upon us ladies and gents. Got the popcorn ready… Garth’s post tommorow should be uh… “interesting”.

#104 MF on 02.05.18 at 9:49 pm

What on earth happened to XIV after hours tonight?

??

MF

You probably did not know what an inverse vol ETF was until tonight, right? – Garth

#105 millmech on 02.05.18 at 9:52 pm

#84 Angry Guy
I was always told “do not argue with idiots as they will drag you down to their level and beat you with experience”.

#106 Markus on 02.05.18 at 9:55 pm

Question….when would someone not take the cash from a defined pension plan? When its a transfer to another plan?

#107 sleepingdragon on 02.05.18 at 9:56 pm

Big party… more volatility tomorrow! I am going long toilet paper, toothpaste and Advil.

#108 common sense on 02.05.18 at 9:56 pm

And Japan down over 5%.

“We’ve only just begun…”

I loved The Carpenters.

#109 common sense on 02.05.18 at 10:01 pm

Poloz must be secretly smiling tonight knowing if this thing falls bigly, at least the Loonie devalues and a few exporters are saved.

#110 common sense on 02.05.18 at 10:02 pm

#106 Sleepingdragon

Don’t forget SPAM Hormel foods….read a post today saying it’s stock naturally goes up in bad times and drops in good times.

People have to eat and viola, SPAM it is.

#111 Mean Gene on 02.05.18 at 10:08 pm

Bitcoin biters truly bit it today. :-p

#112 JimH on 02.05.18 at 10:09 pm

For those who like to attempt quantification of the emotions that drive markets, this and the supporting criteria can be fun:

http://money.cnn.com/data/fear-and-greed/

#113 conan on 02.05.18 at 10:10 pm

I recently become a government employee, should I transfer my previous DB plan to the government sponsored plan?- Don

Yep, I would jump all over that. Are you talking Federal?

https://youtu.be/veHQMaxiOmg?t=50

#114 For those about to flop... on 02.05.18 at 10:17 pm

Recent Sale Report/ Realtor Assistance Needed.

Found another recent sold in Richmond,and so my shooting is straight tonight.

This house in Richmond sold ten days ago.

As far as potential losses go they should be o.k ,but it could be a good one to find out what’s happening at the bottom of the barrel.

They had a head start…

M43BC

4231 Woodhead Rd,Richmond

Paid 1.31 February 2017 asking 1.59

https://www.zolo.ca/richmond-real-estate/4231-woodhead-road

$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Feel free to make a donation.

Flop For Fox Fund…

http://www.terryfox.org/get-involved/ways-to-give/

#115 Booty Call on 02.05.18 at 10:18 pm

This is Monday October 19, 1987 all over again. I’m loving it. 60% in cash and ready to start stalking prey.

My 40% in equities is hurting bad but I like to do dumb things just to keep life interesting.

The 1987 crash turned out to be an utter non-event. And it eclipsed anything since. – Garth

#116 toronto1 on 02.05.18 at 10:19 pm

#25

i agree…………

interest rates will rise faster and higher then most people think is possible……..

Crypto is done- TPTB will never give up their control to manage monetary policy- never

the DOW will continue to rise but it will not be linear- multiple ups and downs but they will be violent on both down and up swings

In Ontario price inflation is rampant- price of fuel- groceries are rising fast- factor in minor increases in mortgage rates, property tax, etc.. and for those on the edge, this year will be the tide that washes them out………

#117 Sideshow Rob on 02.05.18 at 10:26 pm

Wow the S&P futures are down 50 now. They were up 20 a few hours ago. 70 point drop… Time to invest in something stable. Like shitcoin. Just joking of course. Crazy volatility but still not even a decent correction. It just seems dramatic after years of nothing but up and to the right.

#118 MF on 02.05.18 at 10:31 pm

You probably did not know what an inverse vol ETF was until tonight, right? – Garth

Me? Well..umm I only invest in low MER index funds that are passively managed, of course.

However I sense “someone” out there is predicting some short term volatility…..

MF

#119 Bottoms_Up on 02.05.18 at 10:32 pm

#95 Don on 02.05.18 at 9:13 pm
——————-
Garth gives you the reasons in the post for commuting. A big reason is its in your control, and part of your estate, forever. If you die, your pension essentially vanishes (if you have a spouse, they are entitled to 1/2 of the benefits upon your death). Not good to think about death, but by commuting you spread your risk.

#120 Dermie McLoaird on 02.05.18 at 10:49 pm

They say not many buyers into tomorrow’s market, no one wants to catch a falling knife. When is it not too early to start a nibbly nibblin’?

#121 Linda on 02.05.18 at 10:52 pm

#95 Don – I’m presuming your previous pension plan has a reciprocal porting agreement that allows you to transfer to the pension plan your new employer offers. Whether this is the best course of action financially is another matter. The belief is that any government pension plan is ‘safe’. The reality is that government plans can & do change & not necessarily for the benefit of plan members. COLA may no longer apply. Benefits may be capped or reduced, even as contributions are increased. A DB plan may be changed to a DC or TB model. So the question you need to ask yourself is whether you can trust that the money you could have under your direct control today would be there for you upon retirement if you transferred it into your new employers plan.

#122 morrey on 02.05.18 at 10:55 pm

“The stock market had a long overdue freakout Monday. Be grateful.”

#123 Deplorable tuesday on 02.05.18 at 11:38 pm

#122 morrey on 02.05.18 at 10:55 pm

“The stock market had a long overdue freakout Monday. Be grateful.”
..
To be followed by take a giant crap tuesday…

#124 stock futures on 02.05.18 at 11:49 pm

dropping like a ton of bricks

US markets are already down 5% from the highs. Looking like a nice 10% correction minimum. Average correction is 13%. Haven’t had a 30+ correction since 2008. Historically they occur once every decade .With Trump at the helm, could happen…

#125 As Bitcoin crashes on 02.05.18 at 11:53 pm

1.5 million Canadian citizens born in the US can’t own TFSA’s, Actually according to the Isaac Brock Society in Toronto, American/Canadians living in Canada aren’t protected under the Charter of Rights and Freedoms. They aren’t protected because they are all tax cheats, everyone knows this in fact there are 8 million US Persons around the world who cannot open a bank account. Sure Garth, argue with this and bury your head.

#126 Booty Call on 02.05.18 at 11:55 pm

The 1987 crash turned out to be an utter non-event. And it eclipsed anything since. – Garth

————————————————————
Yes, that was my point of making the Oct 1987 comparison. It was the start of the best bull market in modern times.

History relentlessly repeats but there is usually a subtle twist to confound the masses.

Being that I’m not connected to a global infrastructure of space-age financial intelligence gathering AI machines like the most resilient market players, all I can aim for is trying not be the slowest runner in the massive herd that struggles to follow.

#127 sleepingdragon on 02.06.18 at 1:01 am

@110 commonsense

One third of pantries in American homes contain spam.
Can’t knock until you have fried it!!!

NYSE – HRL)

#128 morrey on 02.06.18 at 1:05 am

“BlackRock warns of risk as inverse volatility products sink”.

oh dear

#129 Smoking Man on 02.06.18 at 1:43 am

T2 getting slaughtered on social media for his condisending tone when he chirp a kid.

It not Man Kind it’s kind. Is his IQ even in double digets?

T2 has now got the attention of 60 million deplorables. Nice.

#130 Vanecdotal on 02.06.18 at 4:28 am

http://www.wideopenspaces.com/5-best-squirrel-recipes/

Cauliflower up 13% from last week too. Prepare…

#131 JimH on 02.06.18 at 6:37 am

Top insider trades recent time-frame: whole lot of selling going on…

https://finviz.com/insidertrading.ashx?or=-10&tv=100000&tc=7&o=-transactionValue

#132 Victor V on 02.06.18 at 7:18 am

Toronto home sales plunge 22% in January amid new mortgage rules

https://www.bnn.ca/toronto-home-sales-plunge-22-in-january-amid-new-mortgage-rules-1.989503

Home sales in Canada’s largest real estate market tumbled last month in the early days of tough new stress tests introduced by the country’s top banking regulator.

There were 4,019 property sales across the Greater Toronto Area in January, marking a 22-per-cent plunge from a year earlier when a record 5,155 sales were notched, according to data released by the Toronto Real Estate Board on Tuesday. January’s sales tally was 18 per cent below December’s activity when 4,930 homes were sold.

All housing segments saw double-digit, year-over-year sales declines in January, with detached property sales suffering the steeping decline at 26 per cent.

#133 Rooster on 02.06.18 at 7:24 am

DELETED

#134 Cat-astrophe on 02.06.18 at 7:56 am

Markets have lost $4 Trillion, almost the entire US debt.
Obviously, markets could easily absorb a US debt default.

“All we are saying, is give Pence a chance.”

#135 Gil on 02.06.18 at 8:06 am

Treb data is in and it’s not pretty. 905 detached is -9%, 406 detached -4%. But the realtors are hopeful for the price growth later in the year ;-)

#136 Howard on 02.06.18 at 8:13 am

Are you bloody kidding me??

Is this seriously our Prime Minister??

Justin Trudeau interrupts woman to tell her to use ‘peoplekind’ instead of ‘mankind’ because ‘it’s more inclusive’

http://www.dailymail.co.uk/news/article-5357037/Trudeau-mocked-telling-woman-say-peoplekind.html

#137 sue on 02.06.18 at 8:35 am

#84 Angry Guy

I completely agree with you and I’m a woman. This society has turned against men (esp cis gendered, white males) Modern feminism is toxic and is a way to attack healthy relationships and families IMHO.

…and don’t get me started on all of the pseudo estrogens in the food supply/water/air to feminize men. The term “Soy Boy” comes to mind.

Men, please keep being men. We girls like it. :)

#138 Gonkman on 02.06.18 at 8:37 am

LOLZ… I just checked and I don’t even need to do anything.

I re-balanced at the end of December and sold off some US Equity to balance things out.

Since Jan 1 and the last 3 days drop my %’s are still on target. The CDN Peso has lost against the US$ so that helped as well.

I though I might actually have to sell some Non US Equity for once and buy some on the cheap… no dice. LOL.

I hope the weather in Peopletoba (Formerly known as Manitoba – We need to be inclusive you know) are warm. If not head on to down Florida and do some Peopltee Watching (Formerly known as Manatees)…

U know it’s bad when world shames your Prime Minister on Twitter via #mankind…

“One Small Step for People! On Giant Leap for Peoplekind!” ???

#139 ANON on 02.06.18 at 8:37 am

There is no money.

#140 Todd on 02.06.18 at 8:38 am

At a glance Treb numbers:

Sales down 22%
New Listings up 17.4%
Active Listings up 136.3%
Average Price down 4.1%
Detached Avg price down 9.1%
Average DOM up 68.4%

Yikes! No wonder they took their time.

Time for another death watch blog post.

#141 crowdedelevatorfartz on 02.06.18 at 8:41 am

@#135 Howard

Trudeau is a one term wonder.
Even “progressives” are tiring of his endless pandering to the gender neutered Left.
Rising interest rates, falling housing prices, deficit budgets…… all spell doom for Socks the Wonderboy.

Now to more important issues.
Elon Musk is about to blast a Tesla car into orbit around the sun………

https://www.google.ca/url?url=https://www.theverge.com/2018/2/5/16974842/spacex-falcon-heavy-launch-tesla-roadster-animation&rct=j&frm=1&q=&esrc=s&sa=U&ved=0ahUKEwiwgPirtZHZAhWN8oMKHSbpCBsQqQIIGzAB&usg=AOvVaw0VY5FJQXdbjrkSzIggvuPF

#142 Roster (neutered & proud) on 02.06.18 at 8:45 am

#96 Bitcoinnaire on 02.05.18 at 9:14 pm
@Garth
>Bitcoin has shed 60%. The Dow has lost 6%.

But the Black Swan event has just been initiated…
At this time, the DJIA sell-off mirrors the BTC plunge on relative terms. They are both currently testing mid-November values.
Bitcoin is also a much younger asset, with an incredible run-up. Surprisingly robust.
***************

It is pointless to debate those who wield power arbitrarily. History, not experience is the best teacher; post-facto means too late.

Your rants compelled me to buy gold a few months back (not much ~1 BTC, now ~2). Gold is an asset; Bitcoin is almost a collectible, but as it has no substance, it has no value. There is nothing surprising about its trajectory. Every minute a child is born who thinks they have the secret to the universe. The ethernet lets them pool their collective wisdom.

Everything reverts to the mean, even intelligence.

#143 robert james on 02.06.18 at 9:15 am

#135 Howard…………….. Trudeau is becoming an embarrassment to Canada… His butt kissing does not look at all !!

#144 Howard on 02.06.18 at 9:22 am

#137 Gonkman on 02.06.18 at 8:37 am

You seem to be a well-adjusted peroffspring.

(can no longer per”son”)

#145 ANON on 02.06.18 at 9:25 am

#139 Todd on 02.06.18 at 8:38 am

At a glance Treb numbers:

Sales down 22%
New Listings up 17.4%
Active Listings up 136.3%
Average Price down 4.1%
Detached Avg price down 9.1%
Average DOM up 68.4%

Talk about all going down at once…

#146 Howard on 02.06.18 at 9:25 am

#140 crowdedelevatorfartz on 02.06.18 at 8:41 am

Sadly I don’t see Andrew Scheer as a winner but I’m willing to be convinced otherwise.

I wish Rona Ambrose had stayed on to take permanent leadership of the party. I presume she calculated that given Canada’s tendency to wait a few terms before turfing a government, she had very little chance of winning in 2019 regardless of her or T2’s performance.

#147 Screwed Canadian Millenial on 02.06.18 at 9:27 am

Hey Garth I posted this on the wrong blog date. Was reading yesterday’s. It was meant for here. Please count it only once against my free speech quota k thx.

—————–

These spoiled boomers sitting on their butts entitled to 7% returns for doing nothing are about to encounter a world of hurt. Good riddance!

#148 She's alive! on 02.06.18 at 10:02 am

Baby, she’s back!
New Fed same as the old Fed – yes yes yes!
Live to see another day!

#149 Rooster (the revenenant) on 02.06.18 at 10:11 am

#135 Howard on 02.06.18 at 8:13 am
Are you bloody kidding me??
Is this seriously our Prime Minister??
Justin Trudeau interrupts woman to tell her to use ‘peoplekind’ instead of ‘mankind’ because ‘it’s more inclusive’
——————-
Did no one else see JT’s wink disguised as a facial tic?
Does anyone here speak French who really can understand him ?
At least he wasn’t nabbed with his knickers down, eh wot?

Fact:
“That’s one small step for (a) man, one giant leap for mankind” (Man on the Moon)

That’s why Elon is sending his rocket up today. We need to address this outrage. I hope it works as well as his flamethrowers. They’re bitchin’

#150 JimH on 02.06.18 at 10:17 am

DELETED

#151 Smoking Man on 02.06.18 at 10:18 am

No Father Daughter dance allowed.
James and Johnneyboy going Yeah!!!

T2 has now dug a whole so deep he’s never climbing out off.

http://insider.foxnews.com/amp/article/60130?__twitter_impression=true

#152 Terry on 02.06.18 at 10:27 am

Trading halted on XIV …………….. ?????

#153 Smokin' hot man on 02.06.18 at 10:28 am

#150 Smoking Man on 02.06.18 at 10:18 am
No Father Daughter dance allowed.
James and Johnneyboy going Yeah!!!
T2 has now dug a whole so deep he’s never climbing out off.
http://insider.foxnews.com/amp/article/60130?__twitter_impression=true
^^^^^^^^^^^^^

You’ve sunk to quoting Fox News?
I get the picture.
You and your BFF, Jordan never got an invite the Sadie Hawkins dance. So sad.

#154 LivinLarge on 02.06.18 at 10:29 am

“These spoiled boomers sitting on their butts entitled to 7% returns for doing nothing are about to encounter a world of hurt. Good riddance!”….naaaaaa, barely a small township of hurt for a short while.

We entitled boomers are entitled because we made our money the old fashioned way, we earned it.

#155 Smoking Man on 02.06.18 at 10:32 am

#146 Screwed Canadian Millenial on 02.06.18 at 9:27 am
Hey Garth I posted this on the wrong blog date. Was reading yesterday’s. It was meant for here. Please count it only once against my free speech quota k thx.

—————–

These spoiled boomers sitting on their butts entitled to 7% returns for doing nothing are about to encounter a world of hurt. Good riddance!
…..

This is how I read your comment.

You have been sold heaps of tidepods at school.. Never learned to risk any thing which means no wealth for you. So your going to take your grammar and spelling skills and try to murder every one that has put on a bet that paid off.

Your on the road to a dead end. But your schooling has made blind to that.

Enjoy ride. Oh what’s this the market making a huge turnaround after it hit bottom this morning.

#156 SoggyShorts on 02.06.18 at 10:56 am

#146 Screwed Canadian Millenial on 02.06.18 at 9:27 am
Hey Garth I posted this on the wrong blog date. Was reading yesterday’s. It was meant for here. Please count it only once against my free speech quota k thx.

—————–

These spoiled boomers sitting on their butts entitled to 7% returns for doing nothing are about to encounter a world of hurt. Good riddance!
*******************
You want returns to get worse? Just because it will hurt others? You sicken me. You complain that the world is against you, but refuse to use all of the amazing opportunities that Canada offers. Try joining the financially sound instead of cheering a dip in the market.
idiot.
M37AB

#157 Guy in Calgary on 02.06.18 at 11:04 am

#79 MF on 02.05.18 at 8:11 pm

I was not referring to the politics around legalization. I was referring to investing in the pot stocks. Your opinion on legalization, is like, your opinion man.

#158 Keith in Rio on 02.06.18 at 11:14 am

https://www.zerohedge.com/news/2018-02-06/canadian-short-vix-etf-suspends-redemptions-citing-extreme-volatility

When ETF’s fail………..heh………expect to see more ETF’s gated as TSHTF in the equity markets.

There are only three assets you should put your non-cash holdings into……..and the cash that you have, should be spread around in a basket of the most liquid and heavily traded currencies, in a couple of different banks, in a couple of different countries.

1 – Gold bullion that you have actual physical possession of. It should be sitting in your safe with our Glock and some loaded clips. The amount you feel you should hold is up to you.

2 – Sovereign government bonds that you hold to maturity. This has been my strategy since 2002. Governments, and their bonds, are the last thing to fail when all else has gone pear shaped.

3 – The house that you live in.

ETFs are not failing. Get a grip. But not on the Glock. – Garth

#159 Innumeracy Chick No More on 02.06.18 at 11:18 am

I get tired of listening to people complain about hospital pensions. I am a nurse I get paid similar to others with university education and moderate amount of accountability. I graduated when there were no jobs in the 90’s worked casual for 3 places did not get to pay into pension at that time after 5 years finally got full time paid into my pension since 2000 started contributing about 3000/yr the hospital contributes 1.26 for every 1 I contribute. It comes off my pay I never see it but then have a smaller pay cheque. Every year the amount has increased to around 6000/yr so as I get increased pay so my contribution increases. Some of my friends working in a private sector did not have pensions and did not put money into an rrsp. Some of my friends have defined benefits where company will match what they put into rrsp. Did they contribute the maximum no of course they didn’t. Because they wanted to SPEND that money. My hubby works private sector we put into an rrsp around the same amount I contributed to my pension. It has only been the last few years his company started a matching rrsp plan. So as a family we have contributed 600 up to 1200 a month in pension payments all those years. We lived frugally bought a house didn’t renovate until we had owned for over 15 yrs. Our friends on the other hand have spent more time and money investing in hardwood floors and fancy toilets. We have mostly original stuff except new kitchen. So it is not what you make it is what you do with what you make. Also all my friends are paying thousands of dollars a year in life insurance, critical illness insurance, dual work medical benefits etc etc. This totals around 300 a month plus on average We have only one work med benefit and opted out of the other, we bought life ins. for a small amount for the first 10 years when kids were young so instead of all that money going to insurance we put that money into an RESP for the kids getting 20% from government growing tax free. We don’t need insurance now because we have enough money saved and kids are teenagers. We were so happy to come across this blog as it has helped a lot with hubby’s rrsps. But I do get really tired of watching my friends throw money around on stupid stuff they have to have and then go ohhhh you have a pension of course you can retire at 55. Lucky you. No smart me! Also they have no idea about investing they think an rrsp is a gic. I have gotten to a point while getting close to 50 that I enjoy more helping my kids plan for a financially and happy successful future than buying designer purses. My friends are all in debt running up credit cards and HELOC the only money they have is in their house. Sad. My dream would be to retire from my nursing job, travel and enjoy life and work part time with Garth helping people make smart choices. :)

#160 Ronaldo on 02.06.18 at 11:26 am

#137 Gonkman on 02.06.18 at 8:37 am

LOLZ… I just checked and I don’t even need to do anything.

I re-balanced at the end of December and sold off some US Equity to balance things out.

Since Jan 1 and the last 3 days drop my %’s are still on target. The CDN Peso has lost against the US$ so that helped as well.

I though I might actually have to sell some Non US Equity for once and buy some on the cheap… no dice. LOL.

I hope the weather in Peopletoba (Formerly known as Manitoba – We need to be inclusive you know) are warm. If not head on to down Florida and do some Peopltee Watching (Formerly known as Manatees)…

U know it’s bad when world shames your Prime Minister on Twitter via #mankind…

“One Small Step for People! On Giant Leap for Peoplekind!” ???
—————————————————————-
Shouldn’t you be changing your name to Gonkperson? You realize how offending your current handle is?

#161 Innumeracy Chick No More on 02.06.18 at 11:29 am

About those HELOC’s…. does anyone have a table that would show the HELOC vs. MTG ammortization? I am curios about this. I can’t seem to find a HELOC calculator that shows the ammortization. If anyone can help?

HELOCs are not amortized. The simple interest is calculated on the outstanding balance with no amortization term. – Garth

#162 The Technical Analyst, CSTA, CPD on 02.06.18 at 11:33 am

#159 Penny Henny on 02.05.18 at 2:10 pm
#149 The Technical Analyst, CSTA, CPD on 02.05.18 at

“Please let me know when it is safe to play again.
Sincerely Penny Henny”

Thanks for asking.

Now is the time to look at what you want to buy and prepare. Move money to be at the ready to purchase.

WATCH THESE LEVELS CLOSELY:
TSX: 15,000
S&P 500: 2,606-2,637

Set a GOAL

When the market hits -10% I will put X in, -15%, X in, -20% X in…

When the market recovers, do the same in reverse.

I advise clients (and banks) do not put in more than 5% (of total portfolio) in at a time as that can be risky.

Timing the market does work. Hope that helps.

Over the last two years that strategy would have seen investors spending ever-greater amounts to buy the same assets, increasing risk. Total fail. – Garth

#163 Guy in Calgary on 02.06.18 at 11:35 am

The Hang Seng is selling off too. Nowhere to hide! All those retail short vol traders learning a tough lesson I bet.

#164 X'er on 02.06.18 at 11:51 am

@livinglarge
“We entitled boomers are entitled because we made our money the old fashioned way, we earned it.”
To say your entitled like a spoilt brat. Try feeding this “entitled” crap to the generation before you, the silent generation, that paved the way for your generations success after ww2.
Cheers.

#165 Ed. on 02.06.18 at 11:54 am

#158 Innumeracy Chick No More on 02.06.18 at 11:18 am
………………………………………………………………………………………………………………………………………………………………………………………………….My dream would be to retire from my nursing job, travel and enjoy life and work part time with Garth helping people make smart choices. :)
—————-
Learn what a paragraph is and we’ll talk. – Gerta

#166 For those about to flop... on 02.06.18 at 11:54 am

Mornin’ Guvner…

M43BC

“Mapping Governor’s Salary in Every State

President Trump promised that he would take no salary if elected, and thus far he has donated his compensation to worthy causes. That’s all well and good, but with the 2018 election seasonheating up, it got us thinking about the differences in compensation for executives at the state level. So we did a little research and created our new map of the governor’s salary for every state in the country.

We used salary figures from Ballotpedia, a website that works to inform voters in a nonpartisan way about how the government operates and what elected officials are doing. We colored each state based on the political affiliation of the governor, then added a photo of the chief executive together with his or her salary. This approach creates a quick snapshot of their compensation, allowing for an easy comparison between states and political parties.
First off, there are a lot more red than blue states on our map simply because Republicans tend to win governorships more often than Democrats. There are a lot of reasons for that, including how many gubernatorial elections happen during off-Presidential election cycles (there are 36 this year). More to the point, listing a salary on a map reveals the stark differences in compensation for governors in states right next to each other. For example, Jerry Brown (D) in California makes $75K more each year than Kate Brown (D) in Oregon. Brian Sandoval (R) in Nevada pulls in $50K more than Doug Ducey (R) next door in Arizona.

Keep in mind governors serve four-year terms, which makes the discrepancies that much more significant over time. OK, governors in Vermont and New Hampshire only serve two-year terms, but here’s the point. Let’s take the most extreme example. The highest paid governor in the country is Tom Wolf (D) from Pennsylvania, who pulls in an impressive $187,818 each year. That’s good work if you can get it. The lowest is Paul LePage (R) in Maine, who only makes a measly $70,000. Think about that—after four years, Wolf will make $471,272 more than LePage. Pennsylvania is a lot different than Maine, but they have the same job. An annual salary of $70K is certainly quite low for a governor, but it’s still quite a bit higher than the median income in the U.S., so let’s not shed too many tears for LePage.

Another way to analyze the data is by making partisan comparison between Republicans and Democrats, and to make things fair, let’s compare the two groups by looking at averages. The average Democratic governor’s salary is $146,221 compared to $128,327 on the Republican side. As a matter of fact, 7 out of the 10 highest paid governors are Democrats, even though there are just 16 Democratic governors in the country compared to 33 Republicans (Gov. Bill Walker from Alaska is the lone independent).

1. Pennsylvania: Tom Wolf (D) at $187,818

2. Tennessee: Bill Haslam (R) at $181,980

3. New York: Andrew Cuomo (D) at $179,000

4. Illinois: Bruce Rauner (R) at $177,412

5. New Jersey: Phil Murphy (D) at $175,000

6. Virginia: Ralph Northam (D) at $175,000

7. California: Jerry Brown (D) at $173,987

8. Delaware: John Carney (D) at $171,000

9. Washington: Jay Inslee (D) at $166,891

10. Michigan: Rick Snyder (R) at $159,300

For whatever reason, Democratic governors are comparatively more expensive for taxpayers than Republicans. We will leave it to you to draw your own conclusions about exactly why.”

https://howmuch.net/articles/every-governors-salary-by-state

#167 Ace Goodheart on 02.06.18 at 12:02 pm

RE: #87 Bitcoinnaire on 02.05.18 at 8:39 pm

“This is all pretty amusing.

“Bitcoin is a bubble”, but apparently so is the legacy boomer securities market.

At least when my magic internet money vanishes, society doesn’t collapse… :3”

Bitcoin, which a month ago was trading for slightly over $22,000 CDN, is now trading for $8835.61 CDN. That is probably the largest historical one month price correction for an asset, other than perhaps a Dutch Tulip fund. It certainly is more than the one month price drop of stock markets during each historical stock price crash to date.

Bitcoin may have set a record as the most devalued “investment” asset ever. That is, if people don’t simply write it off as a bad internet gambling bet and not really an asset.

RE: “Please let me know when it is safe to play again.
Sincerely Penny Henny”

I view investing the same as I view shopping. When things are on sale and I can get a good deal, I buy. When stuff’s expensive, I wait for the next sale.

Stocks are on sale right now. And it looks like the prices will get better before things start going up again.

#168 Dr. Jonas Sulk on 02.06.18 at 12:09 pm

#160 Innumeracy Chick No More on 02.06.18 at 11:29 am

About those HELOC’s…. does anyone have a table that would show the HELOC vs. MTG ammortization? I am curios about this. I can’t seem to find a HELOC calculator that shows the ammortization. If anyone can help?
HELOCs are not amortized. The simple interest is calculated on the outstanding balance with no amortization term. – Garth
——————
The formula for amortization has an exponent in it, so maybe it’s not for you. Perhaps some nursing jargon would help here:

Mortgages are like a slow intracranial bleed that eventually forms a stable thrombus, whereas HELOCs are like an aneurysm, waiting for the perfect moment.

#169 GRM on 02.06.18 at 12:14 pm

I live in Vaughan. Bought my house on paper in 2009 for 482k (against the views on this blog about an impending housing crash) Moved in 2010. Got a HELOC. Used 1-2 year fixed rate portions and left some in the floating portion. Do a lot of side jobs so every penny made went straight into the floating portion and made the 15% prepayment s on the fixed term portions whenever i accumulated enough to do so. If fixed rates decreased id make the 15% prepayment out of the HELOC and immediately lock back in at lower rates. Will have it all paid off by end of March 2018. Fmv of house is probably $1.2 mill. Single income family, 2 kids in private school, used to have a nanny. Wife and 1 child with disabilities. NO help from family whatsoever. Turning 37 this year. Just lots of side hustle and hard work and paying a LOT less on my everyday expenses (groceries, gas) than everybody else by stacking discounts. $1 saved is $2 earned. Now I can turn my attention to maxing out my RRSPs, TFSAs, RDSPs and RESPs (been making min contributions to RESPs and RDSPs in order to get government grants)

#170 Smoking Man on 02.06.18 at 12:16 pm

#156 Guy in Calgary on 02.06.18 at 11:04 am
#79 MF on 02.05.18 at 8:11 pm

I was not referring to the politics around legalization. I was referring to investing in the pot stocks. Your opinion on legalization, is like, your opinion man.
…..

In a world that you may be accused of sexual harassment just by saying good morning to a chick.

I’m long on sex robots and brothels.

#171 good grief on 02.06.18 at 12:19 pm

I advise clients (and banks) do not put in more than 5% (of total portfolio) in at a time as that can be risky.

…………..

there is no way in hell any banks are following this rubbish. Market timing is ‘risky’.

stop being silly

#172 Pre-retiree on 02.06.18 at 12:42 pm

For those thinking about commuting their pensions – here is an article with good advice and some options:

https://www.theglobeandmail.com/globe-investor/retirement/retire-planning/exiting-a-defined-benefit-pension-plan-can-you-and-should-you/article33909740/

#173 John Dough on 02.06.18 at 12:49 pm

#168 GRM on 02.06.18 at 12:14 pm
I live in Vaughan. Bought my house on paper in 2009 for 482k (against the views on this blog about an impending housing crash) Moved in 2010. Got a HELOC. ……Will have it all paid off by end of March 2018. Fmv of house is probably $1.2 mill……..
———————–
Congratulations on your common sense approach and fiscal prudence. Do you think you would have kept your HELOC in a rising interest rate environment? I don’t know where the breakeven point is, but I am certain there is one.

PS I wouldn’t mention the “side jobs” on here, Garth still works for the Man, on the side.

#174 Stan Brooks on 02.06.18 at 1:19 pm

#135 Howard on 02.06.18 at 8:13 am
Are you bloody kidding me??

Is this seriously our Prime Minister??

Justin Trudeau interrupts woman to tell her to use ‘peoplekind’ instead of ‘mankind’ because ‘it’s more inclusive’

http://www.dailymail.co.uk/news/article-5357037/Trudeau-mocked-telling-woman-say-peoplekind.html

——————————–

I just had another orgasmic/seismic schadenfreude.

It gets sunnier by the day in the mental institution.
When this individual and his ethically challenged staff started accusing doctors of being tax cheats I was stunned, but then I realized what this is – just another day in the mental institution with patients running amok while judging and locking out the personnel/doctors.

I am absolutely voting for the liberals again – the only option to get such free laugh every day.

As for the economy – who cares.

#175 learningfromyou on 02.06.18 at 1:27 pm

Thank Garth for this post

I do not understand your strategy using the HELOC to pay faster your house.

On every mortgage payment, the first portion of it pays the interest generated from your debt to the bank for the days you have used it since the last payment, this portion is higher if you interest rate is higher.
The remaining portion reduces your debt capital and on the next payment you end up paying a few pennies less of interest.

If you pass that mortgage completely to an HELOC with a higher interest rate and while trying to pay exactly the same amount per period whatever it will be you will end up increasing the interest portion resulting in paying less debt capital per payment

Garth, please could you explain me in what corner I got lost here?

I really appreciate in advance your answer.

Thank you

#176 Bytor the Snow Dog on 02.06.18 at 1:29 pm

RE: Those complaining about post #31. I’m wondering who’s stupid. The poster or the complainers? It’s obviously a parody. A Shtick.

RE: #158 Innumeracy Chick No More- Stick to nursing, cause you obviously ain’t cuttin’ it as a writer.

Now on to the topic at hand….gold plated government pensions. I just retired on mine at the age of 56. I earned every penny of it.

Have a nice day!

#177 IHCTD9 on 02.06.18 at 1:38 pm

#168 GRM on 02.06.18 at 12:14 pm
____________________________

Good show, excellent results.

We bought in ’01, @6.5%. Rates eventually went down to 1.5% (we had a sub-prime variable). But instead of taking the discount, we paid the same as we did @6.5% right through, and the difference went down as a lump sum against the principal – we did this monthly.

End result was we made the same payment the whole time, but mortgage was gone in 14 years – and that’s all we did to hurry things up other than paying weekly. Doesn’t take much, just consistency, and time. Same results could be had throwing an extra 20% on your weekly payment towards the principal every single week.

I have big tuitions (potentially) to backstop over the next 6 years, but I also look forward to turbocharging our investments as soon as the big financial commitments are complete.

#178 Cottingham a bargain on 02.06.18 at 1:42 pm

#168 GRM.

Well done sir . You fit the profile of most homeowners even if this blog tries to promote homeowners as over leveraged house horny , hard wood loving freaks .

I will venture a guess that your heritage and background involves a little boot from where those who have come have built fortunes around RE

#179 IHCTD9 on 02.06.18 at 1:42 pm

DELETED

#180 Midnights on 02.06.18 at 1:54 pm

Market “Earthquake Is Coming” – Icahn Warns “A Lot Of People Will Pay The Price Like In 1929”

https://www.zerohedge.com/news/2018-02-06/market-earthquake-coming-icahn-warns-lot-people-will-pay-price-1929

Icahn: Best Before Date – 1987. – Garth

#181 Penny Henny on 02.06.18 at 1:54 pm

#161 The Technical Analyst, CSTA, CPD on 02.06.18 at 11:33 am

WATCH THESE LEVELS CLOSELY:
TSX: 15,000
S&P 500: 2,606-2,637

Set a GOAL

When the market hits -10% I will put X in, -15%, X in, -20% X in…

When the market recovers, do the same in reverse.

I advise clients (and banks) do not put in more than 5% (of total portfolio) in at a time as that can be risky.

Timing the market does work. Hope that helps.

////////

Thanks

#182 LivinLarge on 02.06.18 at 2:12 pm

“Try feeding this “entitled” crap to the generation before you, the silent generation, that paved the way for your generations success after ww2.
Cheers.” LOL, that made you feel better about yourself didn’t it? You feel like you stormed the gates of hell itself and struck a blow for all the silent generation still living. I hear the Battle Hymn of The Republic playing softly in the backgroud.

Trouble is, my post was sarcastic mocking of SCM…btw the first time I’ve bothered with SCM. So…read for content please before puking on my croissant.

#183 Tony on 02.06.18 at 2:18 pm

Re: #172 Penny Henny on 02.06.18 at 1:54 pm

They don’t let stock market indexes fall 20 percent anymore at least not at the close only intraday.

There is no ‘they.’ – Garth

#184 TSX on 02.06.18 at 2:27 pm

what a meldown. BUT buyers coming in today, very nice candlestick forming. Let’s see if she can hold for the close. 3:50 pm…gotta see the candlestick!!!

#185 ANON on 02.06.18 at 2:37 pm

There is no ‘they.’ – Garth

In the top of Garth’s best one liners.
We few, we happy few, know that. :)

#186 james on 02.06.18 at 2:50 pm

#154 Smoking Man on 02.06.18 at 10:32 am

#146 Screwed Canadian Millenial on 02.06.18 at 9:27 am
Hey Garth I posted this on the wrong blog date. Was reading yesterday’s. It was meant for here. Please count it only once against my free speech quota k thx.

—————–

These spoiled boomers sitting on their butts entitled to 7% returns for doing nothing are about to encounter a world of hurt. Good riddance!
…..

This is how I read your comment.
You have been sold heaps of tidepods at school.. Never learned to risk any thing which means no wealth for you. So your going to take your grammar and spelling skills and try to murder every one that has put on a bet that paid off.
Your on the road to a dead end. But your schooling has made blind to that.
Enjoy ride. Oh what’s this the market making a huge turnaround after it hit bottom this morning.
_________________________________________
Define huge Smoky, huge like your ego? Like Donald Trumps fat ass?
Check out the national debt you idiot. Nobody and I mean nobody in your short lifetime will ever see this paid off. So it doesn’t matter what the market does its all smoke and mirrors. Loved your call on the 1100 point loss the other day, what? is that crickets I hear?

#187 james on 02.06.18 at 2:51 pm

Oh snap here is some fun stats!

http://www.usdebtclock.org/

#188 Fixing a Hole on 02.06.18 at 2:52 pm

#182 Tony on 02.06.18 at 2:18 pm
Re: #172 Penny Henny on 02.06.18 at 1:54 pm
They don’t let stock market indexes fall 20 percent anymore at least not at the close only intraday.
There is no ‘they.’ – Garth
*************

I think I got the leaks fixed.

I will be knocking off before the bell at 3:25 pm today as usual. Be advised that I turn the S&P 500 circuit breakers off then, as is our custom since we switched over from the Dow. (The DJIA version had some bugs). We did have some hiccups in 2015, but we are working on a solution.

So remember the Level 1 breaker is @7%, Level 2 is @13%, and we just let those ride after 3:25.

At Level 3, @20% we shut her down for the day. Better luck tomorrow.

Janitor Jerome

#189 GRM on 02.06.18 at 2:58 pm

#172 – Yes – I think that its worth having a bit higher interest to have the flexibility to drop every penny possible towards the principal. I don’t see a point of having a 300k mortgage and having 30k sitting in a chequing account or high interest savings account for a rainy day. I’d rather have 270k in a HELOC at a slightly higher rate. One thing that really did help was setting up multiple fixed rate “mortgages” within the HELOC for short periods (1 – 2 years) and staggering them. This way, I knew realistically how much I would be making in the short term to be able to accelerate towards the principal, but the amounts I knew I wasn’t going to be able to get to, i’d lock in at low 1 or 2 year fixed rates within the HELOC. Then by the time they came due and went back into the HELOC, i’d project how much I’d be able to pay down over the next year and leave a portion floating in the HELOC that I could pay off as soon as money came in the door. Also, if rates went down, I would use the HELOC to pay down 15% of the fixed rates and re-lock in that portion i just paid down at a lower rate. At one point I had 6 or 7 different fixed rate mortgages within the HELOC all at different rates.

The key is discipline. I’m not one of those people that has a burning sensation to spend money if I have it. To me, it was more fun and more of a challenge paying down the HELOC and mortgage ASAP than going to buy coffee or a new toy or gadget somewhere.

#190 GRM on 02.06.18 at 3:02 pm

#177 – came here as an immigrant when I was 10. Lived in a rented apartment with family. Parents got a job in the US and left when I was 16. Stayed here in the apartment with my 18 year old sister. Parents obviously at that age sent money for the bills but I still worked part time, and held 3 part time jobs at the same time while in University – and didn’t blow my parents money on garbage either.

#191 GRM on 02.06.18 at 3:04 pm

#174 – what he means is that you don’t just make the same payments you would make under a mortgage. If you have a traditional mortgage at 3% making $2000 payments every month, or a HELOC at 3% making $2,000 payments every month, you will be at the exact same position. The difference is with a HELOC you aren’t limited to the $2,000 payment. If you all of a sudden get a bonus or come up with extra money, you can immediately drop that in. So if your $2,000 payment is split $1,500 interest and $500 principle, and one month u put in $2,400, thats $1,500 towards interest and $900 will go towards the principle.

#192 jess on 02.06.18 at 3:20 pm

spookin’ the bank boardrooms

“The Fed Gets Tough. The Federal Reserve took unprecedented move to handcuff growth at Wells Fargo & Co. and put boards of directors on notice that they will be held accountable when big banks fail to manage risks.”

https://www.dcreport.org/2018/02/05/fed-puts-fear-of-god-into-big-banks/

======
the blacklists?

From swissinfo:
Could there ever be a global blacklist of undesirables? “The banks would love that,” Fenner said. “The permanent debate between the banks and the regulators is: tell us who you don’t want us to bank with and we will stop dealing with them straight away.”

Instead the banks have to work with the definition of ‘politically exposed persons’ (PEPs) and apply the checking measures themselves.

Thomas Sutter, a spokesperson for the Swiss Bankers Association, told swissinfo.ch that banks would surely welcome a binding, official list of potential clients they should not bank with due to the risk of money laundering. However, for him, the question of who would be responsible for creating such a list also remains open.

“Of course, such a list would have to be supported internationally,” Sutter says. “In contrast, it cannot be the job of a bank to create such a list.”

Thomas Sutter, a spokesperson for the Swiss Bankers Association, told swissinfo.ch that banks would surely welcome a binding, official list of potential clients they should not bank with due to the risk of money laundering. However, for him, the question of who would be responsible for creating such a list also remains open.

“Of course, such a list would have to be supported internationally,” Sutter says. “In contrast, it cannot be the job of a bank to create such a list.”

#193 Penny Henny on 02.06.18 at 3:22 pm

#182 Tony on 02.06.18 at 2:18 pm
Re: #172 Penny Henny on 02.06.18 at 1:54 pm

They don’t let stock market indexes fall 20 percent anymore at least not at the close only intraday.
///////////////////

Technical Analyst was simply providing an example.
My markers might end up being 8%, 12% and 16%.
The important part is to have a plan and follow through with it even if it doesn’t feel right at the time.

#194 Penny Henny on 02.06.18 at 3:43 pm

Toronto Real Estate Charts

http://torontorealestatecharts.com/?utm_source=Newsletter&utm_campaign=January_2018

#195 X'er on 02.06.18 at 3:47 pm

@livinlarge
“Trouble is, my post was sarcastic mocking of SCM…btw the first time I’ve bothered with SCM. So…read for content please before puking on my croissant.”

Apologies I didn’t realize you were mocking boomers with the “entitled” spiel, in your post. I gather you are not of that generation then, because I was going to suggest you look up the meaning of sarcasm.
Cheers, and enjoy your croissant sir.

#196 The Technical Analyst, CSTA, CPD on 02.06.18 at 3:51 pm

#192 Penny Henny on 02.06.18 at 3:22 pm
#182 Tony on 02.06.18 at 2:18 pm
Re: #172 Penny Henny on 02.06.18 at 1:54 pm

They don’t let stock market indexes fall 20 percent anymore at least not at the close only intraday.
///////////////////

#192 Penny Henny: Technical Analyst was simply providing an example.
My markers might end up being 8%, 12% and 16%.
The important part is to have a plan and follow through with it even if it doesn’t feel right at the time.

///////////////////

Thanks PA, yes, it was just an example. Those technical indicators I provided above did hold and the market bounced off them. If you have the risk tolerance go ahead and buy tomorrow if the market holds. I did jump in today for a purchase as my first marker was at 5%. Now I’ll wait and see what tomorrow brings.

I’m a long term holder BTW, not a day trader.

“Over the last two years that strategy would have seen investors spending ever-greater amounts to buy the same assets, increasing risk. Total fail. – Garth”

I respect your assessment Garth but I wouldn’t call it a “total fail”. It has worked great for my clients, myself and the 2 big banks I advise as a technical analyst. I guess you missed my posts in 2016 calling the big 3 bottoms and the USD/CAD top eh?

#197 jjoblo on 02.06.18 at 3:54 pm

If Turdeau has his way, legal name changes all.

Hoffmann, Neumann, Zimmermann, Hartmann, Hofmann, Lehmann, and Herrmann Goldman

become:

Hoffprople, Neupeople, Zimmerpeople, Hartpeople, Hofpeople, Lehpeople, and Herrpeople, Goldpeople

#198 Smoking Man on 02.06.18 at 4:32 pm

James
Define huge Smoky, huge like your ego? Like Donald Trumps fat ass?
Check out the national debt you idiot. Nobody and I mean nobody in your short lifetime will ever see this paid off. So it doesn’t matter what the market does its all smoke and mirrors. Loved your call on the 1100 point loss the other day, what? is that crickets I hear?
…….
Yuuge?
I would show you a photo but unlike SCM I have manners and decorum.

#199 jess on 02.06.18 at 4:47 pm

the right wingers giving advice on “liberal” media e.g. stephen moore?
“former Board Member of the Donors Capital Fund, Inc. In 2008, Donors Capital sluiced $17,778,600 into the Clarion Fund so that it could release 28 million DVDs of the race-baiting documentary, Obsession: Radical Islam’s War Against the West. This avalanche of DVDs was inserted in major newspapers across America just seven weeks before the Presidential election, in the midst of a whisper campaign that Obama was a Muslim. The DVDs flooded households in the swing voter states.

http://www.cnn.com/TRANSCRIPTS/1802/03/cnr.07.html

http://wallstreetonparade.com/

=
Hualien, Taiwan
https://www.reuters.com/article/us-taiwan-quake/at-least-two-dead-in-magnitude-6-4-quake-in-taiwan-premier-idUSKBN1FQ2DS

#200 XIC on 02.06.18 at 4:52 pm

posted a swing trade on Canopy Growth about a month ago and I will post my second swing trade now (some said I ‘was lucky’ with said trade)

as we all know the TSX has been in free fall– each day a lower high, lower low. EIGHT straight days since a bearish engulfing pattern formed. Took a position today at 3:50 pm. Half of a position– strong rally into the close, huge volume and a green candle. Am expecting tomorrow’s candlestick to have a higher high and higher low– if so i will ADD the other half to make it a full position at 3:45 pm Wed

like my chances at nailing another swing trade. I’ll post win or lose (stop loss is in, can’t lose more than 2% of my trading account). Todays post is on Tuesday Feb 6th.

have a good night!!

#201 Stan Brooks on 02.06.18 at 5:03 pm

TSX up the incredible 0.19 % today.

TSX:
Market cap: 2.3 trillion USD
GDP: 1.6 trillion USD, 1.7 trillion PPP

Germany:
Deutsche Börse market cap – 2.1 trillion USD
GDP – 3.4 trillion USD, 4.1 trillion PPP

https://en.wikipedia.org/wiki/List_of_stock_exchanges

http://statisticstimes.com/economy/countries-by-projected-gdp.php

—————————————

I had to read the above twice and then hit myself hard in the head to make sure I am awake.

TSX larger in market cap than the Deutsche Börse in Frankfurt, Germany, the financial heart of Europe?

Really?

Stay away from TSX.
That thingy is at least 2.5 times overpriced, maybe 3.
TSX market cap was 320 billions in 2001 and half of it, 160 billions was Nortel.

#202 Your House Ain't There No Mo on 02.06.18 at 5:09 pm

Teens steal entire house. Couple wants it back

http://abc13.com/i-need-to-report-a-stolen-house-couple-wants-their-home-back/3034896/

#203 Stan Brooks on 02.06.18 at 5:19 pm

Very interesting paradox:

Engineer ‘growth’ based on debt and Negative real interest rates (positive nominal rates of 0.5-1.0 % with real inflation 5 % +) while burning savings in the process and as a result report fake/unsustainable profits that drives all asset prices:
– market cap of financials and service sector/oligopolies to ridiculous historical valuations and real estate prices to insanity.

Sustainable you say?

Yes, at 30 cents loonie.

#204 young & foolish on 02.06.18 at 5:25 pm

We poke a lot of fun at Bircoin trading on this blog … but …

https://www.thestar.com/business/analysis/2018/02/06/how-stock-market-trading-is-becoming-a-lot-like-bitcoin-trading.html

#205 re., stan brooks on 02.06.18 at 5:39 pm

TSX up the incredible 0.19 % today.

TSX:
Market cap: 2.3 trillion USD
GDP: 1.6 trillion USD, 1.7 trillion PPP

Germany:
Deutsche Börse market cap – 2.1 trillion USD
GDP – 3.4 trillion USD, 4.1 trillion PPP

https://en.wikipedia.org/wiki/List_of_stock_exchanges

http://statisticstimes.com/economy/countries-by-projected-gdp.php

—————————————

I had to read the above twice and then hit myself hard in the head to make sure I am awake.

TSX larger in market cap than the Deutsche Börse in Frankfurt, Germany, the financial heart of Europe?

Really?

Stay away from TSX.
That thingy is at least 2.5 times overpriced, maybe 3.
TSX market cap was 320 billions in 2001 and half of it, 160 billions was Nortel

…………..

you trying to bring down the IQ of the comment’s section ? you’re doing a pretty good job

#206 Stan Brooks on 02.06.18 at 5:56 pm

Our leader winning respect for Canada abroad:

How dare you kill off mankind, Mr Trudeau, you spineless virtue-signalling excuse for a feminist

http://www.dailymail.co.uk/news/article-5358761/PIERS-MORGAN-dare-kill-mankind-Mr-Trudeau.html?mrn_rm=als1

with the following comment:
What a load of snivelling donkey wallop.

#207 Stan Brooks on 02.06.18 at 6:07 pm

And here I laughed hard:

Rita Panahi called him (T2) the “Kim Kardashian of political leaders; an all-style, no-substance himbo with all the depth of a puddle.”

#208 Esso on 02.07.18 at 7:36 pm

Well, guess my spouse and I are the disciplined few. We switched to M1, essentially a HELOC, five years into our first mortgage. Finished another 5.5 years into that, despite modest income, a job loss during our mortgage, etc. But discipline and mutual goals were key. Grew up (very) poor so now we feel wealthy. Had friends that had to get out of HELOC cause they ended up no further ahead despite a huge income and modest mortgage.