What really matters

The latest Shiller shows the heady plunge into US-style weightlessness for Vancouver (pink blobs at left). Do they know this in Ottawa? Do they care? Chart source.

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Some folks here have asked me to comment on the weirdness that is Ottawa right now. Well, kids, ain’t gonna happen. I have a sort-of political blog but it’s hardly a sober and responsible, academic and weighty thing like this one. So, just as I never do weed while terrorizing small hamlets on my bike, we won’t mix politics with your financial future. (And with that last admission you can pretty well kiss my political ambitions adios.)

Anyway I’d rather talk about a few things of greater interest than the next government, which is not looking too hot, whatever flavour it ends up being. For example, one of the country’s biggest banks has just had a profit crisis. Scotia’s earnings in the latest quarter have fallen by two-thirds – horrible news which was behind the drop on Bay Street today even as Wall Street was soaring.

Worse, Scotia is now letting it be known that if you want a loan, well, shop elsewhere. “Bank of Nova Scotia is pulling back on lending to consumers and warning investors to brace for softer earnings next year as the economy slides into recession,” says a story in the current Financial Post. “The third-largest bank in the country provided the clearest signal yet of any major Canadian financial institution that it is reining in offers of loans to customers for big-ticket items like homes.”

Hmmm. Not good, especially with what’s going on with CIBC. But that’s not all. Then there’s Manulife Financial which is about to post its first loss in corporate history – a smashing $1.5 billion dump in just a three-month period. To rescue its festive goose, the company will be issuing stock – more than $2 billion of it, at a time where markets are terrible. That shows desperation, of the kind we saw a few days ago over in the big black tower at King & Bay, where TD Bank also went to the equity well for $1.4 billion. Make no mistake about it, smart guys like bankers do not flog pieces of their company when share values have tanked. Kinda like burning the Renoirs.

But there’s more to worry about than the banking system. Oil is now at $46.76 a barrel, which I guess means every jar of crude coming out of Fort Mac is now losing money for the big guys there. And worse is coming. Because while I forecast $50 oil some months ago, once again I was too conservative. Expect $30, as fears mount of a global recession just too far gone to stop. And that’s a shame after the US and other countries have spent unheralded amounts of money trying to reflate. Sadly, Lassie’s dead.

But there’s more. Investors sucked $1.1 billion out of mutual funds last month, which is another reason to worry about Bay Street and the financial markets. The automakers have said they need almost $30 billion or they will be wheels up by the time Obama gets his new airplane, and then there’s Vancouver.

The real estate board in that city announced today that home sales last month dropped a tad – 70%. So, about 800 houses sold, and there are more than 18,000 others on the market. I guess that means you get to sell your house in two years. Prices, by the board’s count, fell 13% between May and November, but in some areas the decline far exceeded that – especially where there are holes instead of new condos going up. The average price for SFH, I heard, is down about $175,000.

So, I’d say, we have other things to worry about rather than who gets a limo and driver on Parliament Hill. And this downturn has only just begun. Another few days, and we’ll be breaking out the squirrel recipes again.

However, I hear they’re also feeling defensive this time of year.

103 comments ↓

#1 Bottoms_Up on 12.03.08 at 12:08 am

I picture that squirrel aiming at Vancouver realtors…hilarious!

#2 Chris L on 12.03.08 at 12:12 am

Of course squirrels are defensive this time of year, they’ve spent the better months of their year preparing for the future, investing, scrimping and fattening up. How would you react to having your livelihood threatened? haha

#3 Waiting for a Deal on 12.03.08 at 12:15 am

I hear Squirrel Meat tastes like chicken.

#4 Danny on 12.03.08 at 12:19 am

Just about to put an formal offer on a house, when it went power of sale before I had a chance to. It was ‘only’ on the market for about 10 months, at progressively declining offering prices. After my further investigation it was revealed that the mortgages and interest owing on the house is more than the net expected selling price on the house (after real estate fees). A first mortgage, second mortgage, and a third mortgage (all done in 2007 and prior). The builder was trying to arrange a incredible fourth mortgage, when the private lenders (one of them, at least), pulled the plug….not that the builder had a 1/2 a chance of getting anymore funding anyway.

Garth, my question is how long can private lenders (5 different people on 3 seperate mortgages) wait out selling in a market that is getting a lot of bad press these days (now from people other than you…)? What’s your experience with this, and how do you think I should attack the situation when the house pop’s back on the market in a few days?

#5 My_view on 12.03.08 at 12:22 am

Garth,

Nice post.

But I thought our banks were safe, at least that’s what Con-Harp said. Is it just a matter of time for a Canadian bank to fail? Maybe merge? Government bail outs? If the banks wont lend, only people with coin can buy. The frugal will prosper, the way it should be. For all the people that will buy real estate in the next couple of years. We will be hated by those sellers, especially the ones that had just owned for a few years. Oh well. Licking my fat ass CHOPS!

#6 paulb on 12.03.08 at 12:36 am

I just watched Bond and there was a Scotia ad in the endless previews. The “You’re richer than you think” slogan was met with many moans and groans. Lol!

#7 Ed Sager on 12.03.08 at 12:43 am

Damn… sniping prairie dogs just isn’t going to be as much fun any more now they’ve gone full auto (registered, no doubt…). Suppose we can get the little suckers to target Ottawa pols?

#8 random guy on 12.03.08 at 12:50 am

i like the squirrel’s saddam beret

#9 Soylent Green is People on 12.03.08 at 12:59 am

by Peter Schiff today

Paulson stated clearly that he would like the Fed to print as much money as it takes to revive the economy.

Unfortunately the only industry likely to be revived by such policies is (the) printing (business) itself.

But even this will not help the United States as the majority of our printing equipment is imported from Switzerland.

http://www.safehaven.com/article-11976.htm

Remember to light your candle in your window Thursday night at 7:00 pm.

#10 $fromA$ia on 12.03.08 at 1:00 am

Wait, theres no tail, it’s got to be a hamster.

#11 Declan on 12.03.08 at 1:02 am

I appreciate that you’re one of the few public figures who’s been at all out in front on the housing collapse, and the blog is great, but using someone’s chart without attribution, makes you look like a jerk, so I recommend updating the post.

Regardless of the source, that’s one alarming chart.

#12 The Tallyman on 12.03.08 at 1:06 am

HA Ha!!! great pic Garth.

Kinda get numbed to the piecemeal info the media is feeding, but when you put the pieces all together like you have in your post… this planet is screwed for a long time.

Can’t buy a house when banks are sending away buyers.
I have been waiting a long time for prices to fall back to reasonable levels but won’t be buying anytime soon.
The possibility of at least having a house with a yard remains a pipe dream.
Gonna have to be content with my tiny shoebox and eat veggies from a can.

#13 The Tallyman on 12.03.08 at 1:10 am

Caption for the armed squirrel pic

“Not on my watch Realtor!”

#14 charliegosurf on 12.03.08 at 1:12 am

too fun, got some nice authentics fine qubec cuisine recipe for the sqirrels today, were on the same page gohst rider,lol

or easy rider…or makesme think anout all the fool, those 800 vanspec,,, who bougth still, like slappin the bulls ass in wild hog the movie, too funny

ride on!

#15 Greely on 12.03.08 at 1:12 am

This is getting really good. What an incredible time we live in. Don’t know what it is about hearing all this falling prices news that gets me so excited. Oh yeah, I know, its cause I sold my place last spring while everyone else in Vancouver laughed at me and called me a stupid idiot.

#16 Nick on 12.03.08 at 1:19 am

I’m glad to see you have a sense of humor about the squirrel comments, Garth!

On a more serious note, it’s amazing how much steeper the Vancouver decline is than even the worst US price drops. If that’s the 7 month drop, what’s it going to look like at 20 months? Bad timing for Gordon Campbell to be campaigning next spring as the bottom falls out of the Vancouver real estate market.

#17 Brad on 12.03.08 at 1:20 am

More evidence the squirrels are arming themselves….it looks like they now have M-16’s:

http://www.fugly.com/media/IMAGES/Funny/squirrel_soldier.jpg

#18 Keith in Calgary on 12.03.08 at 1:22 am

Put Calgary in that graph Garth…….and you’ll see that 18 months later from our peak, we are 15% down……..it’s quite the ski hill indeed.

#19 Bailing in B.C. on 12.03.08 at 1:35 am

Just pulled my mutual funds today. I hate to sell low but beats selling at zero. I put the money in GICs and am not sure even that is safe (who is the government anyway?). I have a nest egg in cash with Scotia Bank. Perhaps it should be in the mattress… perhaps it should be in canned beans. The Case-Shiller graph is very disturbing. Glad that I sold my investment property in the Summer…. Wish I’d sold my house.

#20 Bottoms_Up on 12.03.08 at 1:37 am

“Squirrel is one of the most tender of all wild game meats. The rosy pink to red flesh of young squirrel is tender and has a pleasing flavor. The flesh of older animals is darker red in color and may require marinating or long cooking for tenderness.”

http://shenews.projo.com/2008/05/squirrel-for-di.html

#21 3_cheers on 12.03.08 at 1:44 am

And that’s one squirrel I wouldn’t want to mess with…

#22 kitchener1 on 12.03.08 at 1:50 am

It seems like a never ending litany of bad news on a daily basis that is showing no signs of slowing down.

Economically things are going to get a lot worse before they get better

With the TSX testing new lows on a weekly bases and real estate hitting the fan its getting harder for the realturds and stock pimps to push their product. If this negative sentiement continues on for a few more months our real estate correction in Canada is going to way overshoot any rational numbers.

Garth, it looks like your 30% was way to conservative, at this rate of economic deteration I would not be suprised to see even a 50% off peak correction in 8-12 months.

Just like when posistive senitment takes over rational descion making in the consumer marketplace and pushes asset values through the roof, fear does the opposite and drives them through the floor and six feet under. Only problem is that fear is a more powerful emotion then optimism.

#23 $fromA$ia on 12.03.08 at 1:52 am

Ya Garth, just looking at homes in YVR area. Theres still lots of room for home prices to fall before things start to get realistic…Man things still need to sober up;/

#24 Papa Smurf on 12.03.08 at 2:08 am

With Vancouver RE headed down the proverbial cliff, where does that leave Calgary? The general population here still wants to believe the pump-n-dump developers and real estate folks who said Calgary was special and deserved to have the same SFH prices as San Diego.

#25 Fred on 12.03.08 at 2:08 am

It’s not like you admitted inhaling ;)

#26 JET on 12.03.08 at 2:11 am

“Wheels Up” – good one! (Or, four).

#27 S Tastic on 12.03.08 at 2:15 am

Here’s a non-fuzzy graph but doesn’t include Vancouver.

http://seattlebubble.com/blog/wp-content/uploads/2008/08/case-shillerhpi_decline-from-peak_200806.png

#28 bob on 12.03.08 at 3:31 am

It is scary how fast this happened.Almost bought in Victoria 3 years ago,glad I listened to the wife.Worked numbers 5 ways from Sunday but it was still too much even with 2 of us working,no wiggle room.So we hunkered down,keep renting while people still think we’re crazy because “prices are way down now”.Whatever,I’ll just sit on the sidelines.Never thought oil would go so low so fast either that will surely cause a wide ripple effect.We are in the hangover phase I think,glad I didn’t drink any of that kool aid.

#29 supersocco on 12.03.08 at 3:49 am

Not the same graph, but you can still see the Vancouver decline http://www.yattermatters.com/wp-content/images/2008/12/van-average-nov08.jpg

#30 jesse on 12.03.08 at 4:05 am

Vancouver does not have a Case-Shiller HPI as does the US and relies on a “benchmark” calculated by the real estate board. It takes into account various parameters like number of rooms, lot size, etc. to estimate a “benchmark” price. Unfortunately the methods are opaque so we are not privy to the exact methods.

Case-Shiller is a better indication of price movements because it accounts for quality adjustments better than does the benchmark. This aside, the benchmark is likely a reasonably decent proxy for what a Case-Shiller graph would look like for Vancouver.

#31 Whybuywhenucanrent? on 12.03.08 at 4:27 am

Garth–thanks for running the price chart.
Credit should go to
* Seattle Bubble Blog for creating the chart
* Langley Financial Planning Blog for pasting in the first couple months of Vancouver’s price drop
* whybuywhenucanrent? for posting the recent couple months and publicizing the chart.
You rock, BTW, thanks for all you do with this blog.
WBWUCR?

#32 Larry Yatkowsky on 12.03.08 at 4:55 am

Bottoms up

Squirrels never shoot messengers they do however, tip well. :)

#33 Bob on 12.03.08 at 6:04 am

The Liberals are an embarrasement. I’m not a huge fan of Harper but what a joke this coalition will be. Actually they are doing the Conservatives a big favour. They will be grabbing power in the worst economy the world has seen in 70 years! They will be blamed for everything that goes wrong! HAHA i love it!

#34 Vancouver_Renter on 12.03.08 at 6:05 am

Everyone I know with savings who was planning on buying a house has had their portfolios hit very hard by the stock market crash. They no longer have the funds or the stomach to buy a house.

Everyone I know who was planning on buying a house by obtaining a large mortgage is now too afraid to take on large debts. I’m not even sure the banks would lend them the money now.

Offshore buyers are contending with their own nest eggs being wiped out. Have you noticed that most Asian stock markets are down by 2/3 in the last year? I had been a bloodbath. You can bet that many wealthy Asians, who are new to capitalism, were highly leveraged and are facing leverage calls. Their response?… “Dump my Vancouver real estate at any price.”

In my engineering profession, everyone is reporting layoffs and rumors of layoffs and are drastically tightening their belts.

So to all the house sellers in Vancouver… Who, exactly, do you expect will buy your house which, by traditional measures against average incomes and rental rates, is still grossly overvalued?

I won’t even go into the fact that every Olympic city in the last few decades has experienced a post-Olympics real estate crash… or that the Baby Boomers will have to “deleverage” from their big houses and recreational properties in order to fund their retirements… or that Vancouver is the head office for most mining companies in the world and all those “rich” executives have taken a bath in the last few months as commodity prices and share values have crashed.

In my opinion, the ONLY thing that would prevent Vancouver real estate from shedding 70% of its value over the next 2 years would be hyper-inflation. But if the central banks are successful in re-inflating, mortgage rates will be 20%. So I’m not even sure that hyper-inflation would stop the real-estate freefall in the short term, given most people would not be able to make their mortgage payments.

In the mean time, I’ll continue to rent. My wife and I sold our two condos in 2006 because we saw the storm clouds brewing in the US and predicted that it would come to Vancouver. We sold a little too early and could have rode the bubble for another 2 years, but now I’m relieved that we are out of the market.

#35 HalifaxFamily on 12.03.08 at 7:24 am

We’ve had colleagues who are near retirement losing more than 40% on their stock market ‘investments’ and they now are in a panic. There is no way to regain this amount in 10 years or less.

I feel sick just thinking about what they are going through.

We need to get back to the simple life and not get drunk, as the housing market and other markets have, on easy credit.

#36 Toronto Bear on 12.03.08 at 8:37 am

PaulB,

Great comment on the “richer than you think” ads at the movies. I have been loudly groaning about that ad since it came out…which I think has been out for a year or so now! LOL! My wife warns me ahead of time not to make any comments now…she’s heard me rant enough! But you are right, now I am starting to hear other people make comments the last couple of times we’ve gone!

Totally emblematic of our society….”buy as much as you possibly can…don’t worry about the interest you’ll pay back to the bank later….we’ll make those monthy payments small enough by extending the loan term to 40 years!”

#37 Kash is King on 12.03.08 at 9:42 am

#35 HalifaxFamily:

… once upon a time, “Investment Advisors” used to caution people who were close to retirement, or in retirement, to have minimal exposure to equities and other high-risk investments.
Then again, I suppose bonuses to move people into various mutual funds etc… made that sort of logic go out the window.

#38 peter on 12.03.08 at 9:55 am

Good post garth

It will be interesting to see the Toronto RE Board’s take on November, guess it should be out shortly.

Anecdotally in my area, market has gone into a kind of suspended animation. Mexican standoff on prices so sales are way down. Also noticing very few new listings.

#39 JO on 12.03.08 at 10:17 am

Canada’s real economy has just entered the recession in the last couple of months and it will be all downhill from here. We are about 12-18 months behind the US and Europe in the economic and RE cycle, so keep that in mind when you hear any pundit say our banks are healthy. They are in better shape than the large American and European banks for now, but the true reflection will be 12-18 months from now. That is when we will find out how much better they really are/or aren’t. Considering the banking market structure in Canada, it is almost certain the government would have to bail out anyone in trouble. I have to say I am glad to see them issue common stock to help build up capital instead of getting money in shares from the government. They did get 75 B but the gov’t used it to buy insured mortgages, not to inject taxpayer money into the actual FI as share capital. So far so good. If they were really smart, they should all get together and sell a large amount of common equity on the next decent rally that can stick for a few weeks, if and when it comes. The banks are in for a very difficult 3-4 years.

Beyond the banks, keep an eye on large pension funds. It is inevitable this group will come begging for taxpayer money at some point in the next 3-4 years. This area really is a potential national catastrophe.

I have recently lost my job due to economic re-structuring and am hearing many cases of job loss. Life goes on. I have been fortunate enough to have prepared reasonably well for this period. My concern is that as unemployment rises, it will cause far more damage to the economy than in the past. We have the most overleveraged soctiety in history which means if unemployment were to reach 9-10 % a year or so from now, it will have a much more severe impact due to debt levels among the public. For most of these people, who on average have accumulated this debt from living far above their means and being reckless with their money, it will be a scare and may result in aversion to debt for the rest of their lives.

I cannot help but look in disgust at the political games going on. Harper made a stupid mistake and now we are facing the possibility of a socialist, separatist and loser coalition who will steer the country far too left. While I am outraged these lefties would attempt this, the other side of me tells me this might be the best thing for the right of centre as this coalition would take power at exactly the wrong time. You can count on them to waste enormous amounts of money on helping out the failed industries and unions and attack those who are most successful while redirecting resources to those who have been less successful or failures. Welcome to socialism. All of these politicans should be ashamed for engaging in these games at this time. Even if the PC somehow hang on or go to re-election, Harper has to go. I will never vote for him again. In fact, I will not vote if we go to re-election.

#40 Gord In Vancouver on 12.03.08 at 10:25 am

That has to be a Vancouver squirrel !!!
Can you blame him/her for being armed and ready?

Thanks for the graph, Garth.

Please keep us updated. By the time you have enough data to plot 12 months of Vancouver activity, you’ll have to readjust the graph’s Y-axis !!!

#41 smwhite on 12.03.08 at 11:13 am

Well all considering when politicians are the ones dictating economic policy its hard to keep it out of the economic discussion. Not to mention the lack of stability is really reminding me of 1990 all over again. The more usability there is within the Canadian political system the better chance our dollar slides, raising costs of commodities and goods from other countries.

On top of it all rhetoric is still dictating that Canada is not in a recession. Ironic seeing as we found out this week that the USA whom hasn’t been in a recession actually has been in one since December 2007.

Now bring in housings:

http://ca.news.finance.yahoo.com/s/03122008/2/biz-finance-recession-threat-weighs-heavily-housing-markets-2008-remax.html

Markets level this year and only drop by 2% next, if that forecast doesn’t set off alarm bells. I’m assuming that REMAX hasn’t factored in Garth’s points from Scotia, TD and CIBC, which what I take out of it is that the lack of wanting to lend and fear of the banks not getting their money back(customers being upside down in a couple years) is telling me that the banks themselves are expecting a major downturn in housing and do not want to invest in it at the top of the market.

Calgary Rip off, save your pennies, you might get your 200K 3000sq/ft home after all…

Garth, when I do the math on where oil should be factoring in that magical 3% GDP/CPI/inflation goal(from the price ranging from 2000 to 2002), it brings oil to about $30 a barrel today. Wow!

So I guess if you only expect the peons or serfs to have their salaries grow at 3% should we honestly expect the economy and necessities like shelter, food and energy to grow beyond that, how long can you juggle those balls with interest rate tricks?

Greed got us here and being prudent savers will only get us out.

Now I’m off to your other site to poke fun at some separatists, east or west…

#42 David on 12.03.08 at 11:15 am

The housing bubble and unregulated finance have done a terrific job of smashing Canadian families nest eggs. Harper and Flaherty in particular seemed intent on letting the plane fly into the side of the mountain, but now they are bitter about a change of pilots.
I am quite optimistic about the new progressive coalition government, this is an opportunity to start building a fairer and greener Canada, even if in a very awkward fashion.
Adam Smith coined the termed political economy back in the 18th century when capitalism was still in its incipient stages of development. Harper lacked a sense of nuance about that great abstraction called the market. Economics in his view, was a hard science like physics. Perfect markets according to the laws of science can not have bubbles, a hypothesis found to be wanting.
The Canadian political economy became a victim of a commodity and housing bubble in the past 5 years and all of us are now paying the price.
That is one brave squirrel and might qualify as the first squirrel to win the Victoria Cross.

#43 Bulls eye on 12.03.08 at 11:15 am

#19

Continue with your plans to sell your place if you can, I sold in Calgary a couple of months ago for 55,000.00 less than my assesment value. I took a hit, made a bit on equity and am now renting. Regarding your investments, I believe a stage is set to crash the US dollar… that will likely take us down as well. I have invested in EURO for the moment as world economies are migrating to them as a prefered choice. Remember that the worst is yet to come and in the post bail outs we will see stagflation as currency values drop. Good time to be out of debt, as for saving… stay conservative. Remember: People are out to get you for your money.

#44 smwhite on 12.03.08 at 11:16 am

#9 Soylent Green is People

Your telling me the USA is even importing their printing press, that’s sweet! Ha ha!

Actually I’m thinking that all this money printing is good news for the forestry industry.

#45 Dawn in Calgary on 12.03.08 at 11:44 am

That’s it. We’re buying a safe. The weekly transfer to savings is now going to be cash, locked away.

#46 Nicholas P on 12.03.08 at 11:59 am

Ahhh, it’s a relief to see that your focus has returned to the macro-economic forces at work here Garth.

It is of even greater solace to see you join the ranks of the A-political of this country. After the “coalition of the willing” developments from yesterday I forsee many more joining the ranks. Not even a circus side show like we witnessed yesterday can keep our eyes of the global main event on center stage.

This is by no means an endorsement of the Harper regime, but you can add a Global Warming Hoax Tax to ever growing list of burdens Canadians will have to face if Dion et al. pull this one off. If not, after yesterdays performance, a Duet with Celine in Vegas could be a back-up plan.

#47 Calgarian Marked on 12.03.08 at 12:16 pm

Latest outlook on Calgary:
http://www.calgaryherald.com/Homes/Calgary+housing+market+expected+weather+storm+Report/1026094/story.html

An excerpt:
“…Calgary is better positioned to weather the storm ahead than most other major centres in Canada. The city has one of the strongest unemployment markets in the country, with an unemployment rate of 3.7 per cent. The city’s economy grew at an estimated rate of 3.2 per cent in 2008 and is expected to exceed the national average in 2009. Net migration is also forecast to improve in 2009 with an estimated 18,500 interprovincial migrants moving to Calgary. The influx should serve to bolster demand for real estate in the city.”

#48 Mike B formerly just Mike on 12.03.08 at 1:05 pm

Love the picture on this one. Even the Wall Street Journal is finally telling Americans to not expect some miraculous rebound in house prices. Not a magical way to make money in any way

http://finance.yahoo.com/real-estate/article/106238/The-Future-for-Home-Prices

#49 midas on 12.03.08 at 1:33 pm

In the light of the approaching darkness I figured this is worth a repost (originally posted 11-26) notwithstanding all the bloggers who have taken me off their Christmas list. Economic problems are only a symptom of the larger malaise that infects the human race and that which will soon explode (literally) on a global scale in ways that we cannot even begin to imagine.

What’s coming next? I hear the hoof beats loud and clear of the four horsemen of the apocalypse.

1. Economic Ruin (already progressing at lightning speed and now approaching FTL speed)

2. Warfare (that will make WWII look like a Sunday picnic / possibly beginning with an India – Pakistan showdown!)

3. Famine (on a global scale – invest in food not GIC’s; haven’t you noticed how food prices have already gone up and we are in a supposed deflation?)

4. Disease (as in pandemic or one worldwide pandemic that will make the Spanish flu look like a common cold – avian flu is still flying around despite it having been under the radar for the last couple of years.)

Life as we have always known it is over and will never be the same at least in the lifetimes of anyone over 40. The dark ages after the fall of Rome lasted a 1000 years, how long the coming dark age will last only God knows. For those of us who have never known life without electricity the words DARK AGES may acquire a whole new meaning.

Save this post and look at it a year from now and then tell me, it can never happen!!! Sad to say there is no way that it won’t happen.

#50 Toronto Market Watcher on 12.03.08 at 1:34 pm

Great post Garth.
Wow, the convergence of all this negative news on so many fronts does not bode well for real estate in this country. We should get the November stats for Toronto before the end of this week and they will not be pretty. Houses in many of the blue chip neighbourhoods in central T.O. (Lawrence Park, North Toronto, Leaside, Cricket Club, etc.) are down at least 25% and when you consider that most of these houses traded for a least a million ( and some for double that and more) in last year’s peak, that’s one big equity drain over a very short period.
An honest realtor (and there a few out there) will tell you it’s virtually impossible to price a house with any confidence is this tanking market. Sales volume has been so thin this fall in many of the aforementioned areas that’s there’s not enough sales to do a proper CMA.
I did not expect the T.O. market go into freefall mode this quickly but with deteriorating economic fundamentals across the board and stock markets imploding, consumer confidence is non-existent. If the other banks follow Scotia’s lead and tighten the reins on lending, look out! I predict central T.O. prices will be down 50% from their peaks by May/June 2009.
Hang on for the ride…

#51 Future Expatriate on 12.03.08 at 1:35 pm

#34: Don’t count on hyperinflation raising house prices. On the contrary, expect them to continue to fall even as everything else hyperinflates to act as a final, horrific double-whammy to values as banks refuse to lend for the foreseeable future. Make that a triple-whammy. Only folks with cash will be able to buy at prices down 60-70% off peak and they will be few and far between with unsold inventory sitting and rotting for decades. Remember the market MUST correct to what people can afford, and that will be way off peak prices.

#52 POL-CAN on 12.03.08 at 2:49 pm

OT but too funny not to post

Finally, a definition of globalisation I can understand and to which I can relate .

Question : What is the truest definition of Globalisation?

Answer : Princes Diana’s death.

Question : How come?

Answer :
An English princess with
an Egyptian boyfriend
crashes in a French tunnel, driving a German car
with a Dutch engine,
driven by a Belgian
who was drunk on Scottish whisky,
followed closely by Italian Paparazzi, on Japanese motorcycles;
treated by an American doctor, using Brazilian medicines.

This is sent to you by An Aussie, using Bill Gates’s technology,
and you’re probably reading this on your computer, that uses Taiwanese chips, and a
Korean monitor, assembled by
Bangladeshi workers
in a Singapore plant,
transported by Indian lorry-drivers,
hijacked by Indonesians,
unloaded by Maltese wharfies,
and trucked to you by a fleet of Pakistani drivers
fuelled by the Netherlands, wearing safety clothing made in China.

That my friend is Globalisation…

#53 brazer on 12.03.08 at 3:19 pm

http://www.theglobeandmail.com/servlet/story/RTGAM.20081202.wdiscussionhousing1202/BNStory/Front/?pageRequested=all

John Abbott, St. John’s, Canada: Good day. I am leaving the hot real estate market of St.John’s to transfer to Ottawa with federal government. I am wondering if I should rent a while in Ottawa to see how the market goes or buy a condo or townhouse within the next two months.

The Ottawa market is known to be protected, with the federal government as the anchor employer. Do do you see softening in this market for units in the $200,000 to $300,000 range? Cheers.

Mr. Lawby: Now is a great time to buy. You are moving to a market place where price and stability has been demonstrated historically. The local economy is strong and prices are not dropping in any significant fashion, nor are they projected to drop.

With interest rates where they are and on an assumption on my part, that mortgaging will be required, this is the time to seek out guidance from a professional in the industry to give you important information on area selection, traffic pattern, current costs and expected changes in the future. Look now.

=============

this article is a true gem….listen to how the president of century 21 spins every question that’s posed.

any folks wonder why realtors are losing credibility?

#54 Calgary_rip_off on 12.03.08 at 3:22 pm

That’s an interesting chart Garth, but not totally relevant in Canada.

You may want to explain King Harper’s illegal actions in suspending parliament. You may also want to explain why the coalition did not wait until the next election were called to form, this would be more persuasive to voters and Canadians. Is this coalition going to reseparate into Bloc, NDP and Liberal if they do not execute their plan?

In any case, oil has dropped again. This is great news at the pump and ironically bad for many Albertans. There are even those in health care that are worried. I would be more worried if the coalition gets in and crazy people in Alberta decide to separate and Canada breaks apart. Things as we know will cease to exist. Anarchy will prevail.

Perhaps you could persuade the coalition to get their work done, get Harper and the minority conservatives out, and submit a bill that makes it illegal to separate Canada. If all those things go through, Calgary house prices should be around the 2000 median prices again, which is very good news.

#55 john on 12.03.08 at 3:31 pm

HOT NEWS!!!!

McDonalds set to launch new ice cream, McSquirrely

Stocks expected to rise tomorrow

#56 Marc on 12.03.08 at 3:34 pm

I had my RRSP sitting in cash for about 2 years prior to the financial mess we are now in. In Mar. I moved the RRSP from TD to RBC, and unbeknownst to me, my entire cash RRSP was put in Balanced Mutual funds, which have since lost about 30% of my RRSP. Apparently RBC has a signed copy allowing them to move the cash into better investments. 100% of cash going into Mutual funds is not better investing in my opinion. I have asked RBC to send me any copies I have signed, which to date has been over 1 month and no papers. Do I have a legal case against RBC, or am I SOL?

Also my cash stock protfolio I manage myself was at 25% down, and in the last 2 months I have got it back to positive, and have it set up to profit if and when the commodities come back up. I can do the work, and return a profit, and my RRSP is still where it was 2 months ago.

#57 pjwlk on 12.03.08 at 3:35 pm

#15 Greely: “I sold my place last spring while everyone else in Vancouver laughed at me and called me a stupid idiot.”

I’m sure most of us here who have sold in the last year or so have been though the same wringer. I know I have. However a co-worker said to me the other day “I was thinking about you today, telling people to sell their houses , I’ll bet your laughing now.” “Yup” I said “that’s pretty much about it”…

#58 Seeking Knowledge on 12.03.08 at 3:42 pm

Garth,

Here in Fort Mac, almost everyone thought that the joy ride is going to be never endless when oil price was all time high past summer. My neighbor sold his trailer with double detached garage (washroom in the garage) for around 600K back in June.

There were day and night expansion of businesses and a lot of houses. And these new houses don’t go for cheap; the average price goes for about 700K. Restaurants are so pack that it looks as if they are serving for free. I went to GM in town the other day and found out that 1 ton truck would cost no less than 65K, but I thought they are having “buy one get one free” sale. I heard that vehicles are going for 50% off down south.

Most people here think that the drop in black gold is only temporary and some says, “The boom is not even here yet!” Well, I would not know what to think of that but my eyebrows are twitching pretty high these days.

Speaking of squirrels, I found so many squirrels in Bear Creek Park, Surrey, BC the last time I was visiting there. They look very chunky and are the size of a small cat. Since I don’t have a firearm license yet, I think I’ll go get some sling shots now:)

Florence* Fort Mac girl

#59 Boone Pickens jr. on 12.03.08 at 3:46 pm

Although i agree with a lot of opinions and foresight on here, it doesn’t seem too bad in alberta yet? I put my Red Deer house on the market for 399 (28 more than iot’s assessment), and got an unconditional offer 9 less than my list price a couple days ago. Sure it took a few weeks, but i was surprised at the number of showings. I don’t know where the confidence is coming from?? though i’m still blown away that they’re creating net jobs here. ..maybe it’s partly the knowledge that energy prices will rise above $200 within a couple years. Also possibly that Stelmach retracted the royalties and still has money to spend. Anyhoo, time to try some Garth vulture tactics on some not so confident sellers.

#60 pjwlk on 12.03.08 at 3:50 pm

What a joke! – from the Globe’s Report Business site:

“Housing prices will fall about 5 per cent across Canada by the end of 2009 as a slumping economy takes a bite out of consumer confidence, says the ReMax realtor company”

http://www.theglobeandmail.com/servlet/story/RTGAM.20081203.whousingsurvey1203/BNStory/Business/

#61 Tony on 12.03.08 at 4:09 pm

Garth,

The people that you have criticized for overpaying for houses and dipping into their credit lines for sports cars during the good times – are actually the people who kept the economy rolling. Sad is the day for the rest of us when they stop their shopping ways (good or bad), as we’ve recently started to see. Let’s see how good things are overall when the loud mouth twits (many of whom post on this blog) continue to cheer that the system has collapsed – but ultimately do nothing about it anyways. Guess what? if you’re balls weren’t big enough to purchase when times were good, you sure-as-hell ain’t gonna buy a damn thing when times are bad. I suspect many of you will still be living in your parents’ basement cheering every time you hear about another millionaire that went broke. Keep cheering fools!

And now a message to your leader…

Garth, do you have a large tent, and perhaps a big pitcher of kool-aid? After your steady diet of gloom (might as well get the intravenous drip), I think it’s time that all of your idiot basement-dweller followers show up at your place, smoke some of your weed, get their juicebox ration – and get it over with! Think about how much the country will save in welfare payments…

#62 dekethegeek on 12.03.08 at 4:41 pm

A coalition government during these financial times. Gre-a-a-a-t ! Not to worry folks these self serving political ghouls wont last more than 2 weeks together! I wonder which one of these guys gets the middle of the matress when their “spooning” Jack? Gilles? Stephane?
As a political reporter said yesterday.” Its like watching 3 cats tied at the tail.”
Maybe the Con Party should chuck out “control-freak” Von Harper and bring in Peter MacKay ! At least he has half a chance to be the head of a Majority Govt.
Hey! Conservatives out there! Quebec doesnt like Harper and ya aint getting in power with out them! Suck it up and boot the nazi!

Nuf said

#63 Mike B formerly just Mike on 12.03.08 at 4:43 pm

Guess Tony 38 has had a bit of the bottle of late.
Most people here are pretty savvy and don’t back away from buying when they feel it is appropriate. Prices today are not and the future is all around you Tony. Just come out from under the rock and read a newspaper, speak to a banker or economist and generally get a grip on reality.
Sorry can’t write anymore …my mum has finally unlocked the basement door and slid some gruel on a plate to me… must eat..

#64 Dan on 12.03.08 at 4:46 pm

Did any of you see this article? Is it possible that prices will really increase in the regions listed?! How?

http://www.cbc.ca/money/story/2008/12/03/remax-housing.html

#65 hal on 12.03.08 at 5:38 pm

Dan #64………hahahahahahahaha

#66 TOguy on 12.03.08 at 5:41 pm

Hey Garth, US stocks are up 7 of the last 8 trading days. What do you make of it? Do you think the bear market is over for stocks?

No. — Garth

#67 holgs on 12.03.08 at 5:45 pm

Slightly on topic… From the time machine…

“Sellers in hottest housing markets making unusual demands on buyers

Chicago Sun-Times (broken link), Jul 10, 2005 by AMIR EFRATI

Within a month of putting her 2-bedroom house in San Francisco on the market recently, homeowner Linda Gao had five offers, each one above her asking price of $699,000. So before accepting the most- attractive bid, she threw in an extra condition: If you want to buy my house, you have to feed the squirrels.”

#68 neutral on 12.03.08 at 5:59 pm

I read this site sometimes, when have nothing else to do. I was mostly a listener, but those idiotic posts about “squirrel” issue make me really mad. I don’t take into account CalgaryRipOff (she is just a typical woman), but what worries me is that many people take “squirrel problem” as a serious. You guys just scare each other and make yourself even more scared. You just don’t have experience living in these times, therefore you are scared and take any idiotic advice as a valuable. I immigrated from the developing Country and want to share my hands-on experience. I lived through the time, when hyperinflation reached 1000%, I remember the night, when the currency has suddenly been devalued by 10 times, when banks have froze accounts, but the day before President has assured it won’t happen. I was young and had a low paid job about 70-80/mo in local currency. At that time I’ve got a loan for 3000 to buy a car (needed to impress my girlfriend). After a few years of mess my low salary has become a few millions/mo in national currency and bottle of Pepsi cost about 10000. I had fixed interest on my loan, and waited until 3000 become a cost of a paperclip and paid it off. I was sad, I did not buy a house, as after few years I would pay it off instead of buying a bottle of beer. Yeah, some people, who new that, made a real wealth. But returning to the squirrels: in those horrible times I did not eat them, same as all other people did not eat animals (except of those served in local restaurants). I always had a food in the fridge, I drove my near new and near free car to short round trips with my girlfriend and enjoyed the life. All of you, including Garth, never lived in these times, you never lived in the war time, therefore you just guess, and your guess scares you, same as your own image in the mirror.
Hyperinflation? How big? 20%? 50%? 100%? Bhahaha. This is a kindergarten.

Nice story, but deflation is the threat. Try to keep up. — Garth

#69 squidly77 on 12.03.08 at 6:00 pm

that damn squirrel been in my back yard all year
hes been pissed off ever since he lost his tail in my trap

http://www.edmontonrealestateblog.com/.shared/image.html?/photos/uncategorized/2008/12/03/nov08sqft.jpg

graph created by…..edmontonrealestateblog.com

#70 lgre on 12.03.08 at 6:06 pm

Tony, the bank is calling..the matching shackles for your ball and chain are in. Fitment is required..call them asap.

#71 Wealthy Renter on 12.03.08 at 6:12 pm

“McDonalds set to launch new ice cream, McSquirrely”

That’s acorn-y joke! :)

DQ is countering with Chocolate Swirl of Squirrel with nuts!

If you have even faintest sense of macabre, google squirrel recipes. When the going gets weird, the weird turn professional!

#72 Calgary_rip_off on 12.03.08 at 6:54 pm

Neutral:

Try to address the implications coming up: King Harper and his hood try to preserve their minority influence. Good luck with that.

By the way, thanks for the compliment, coming from you: Last time I checked my chromosomes are XY and I cannot grow babies in my stomach. Glad you can tell by syntax and tone which gender wrote what. Its baffling that you thought yourself out of the situation you describe, I wouldnt think it possible.

#73 Samantha on 12.03.08 at 7:31 pm

@ #56 Marc

There HAS to be a copy of the signed document authorizing the transfer of your RRSP from the TD to RBC. Over a month and no paperwork??? Time to play hardball, and yes, you may need a lawyer.

My suggestion is write to the VP and GM of the RBC (Head Office) and copy the Manager of your RBC branch. Outline the lack of response to your request for a copy of your paperwork and that you did not knowingly authorize them to invest your RRSP into mutual funds. Make sure they know you are complaining. (Branches fear complaints from customers that are sent to their VP & GM Executive head office).

There are rules to be followed for anyone licensed to sell mutual funds. It is reprehensible that anyone would place a client into a non-guaranteed product without a thorough explanation of any associated implications/risks of such an investment.

Also, how lacking in common sense was the person who handled your transaction? You are a client transferring a guaranteed RRSP from another institution, and they think you suddenly want to throw it into a non-guaranteed product? Yep, someone wanted to chalk up a sale that day. Always read everything, every piece of fine print when dealing with a bank (or anything of importance). Take the time to do it. I’ve seen too many people sign without reading. Don’t trust anyone or any entity that much.

Good luck.

@ #68 neutral

No one is scaring me. I don’t do fear. I do preparedness.

Oh, and by the way, you don’t have to experience something first hand to learn. I listened to the lessons of my parents, who handed down not only their experience, but of the generations before them.

By the end of WWII in Holland, a squirrel would have been a feast. By the end of the war, people ate tulip bulbs because there was nothing. All the pets – dead and long ago eaten. Suffering? You have no idea. And you know what, neither do I, and I intend to keep it that way – by preparing. Suit yourself. Perhaps you can stew the tires on your car.

#74 dekethegeek on 12.03.08 at 7:48 pm

Can someone please tell me why it takes the Governor General 3-4 days to “cut her European tour short and hurry back to Canada” ? WTF? The friggin tourists in Thailand are back before her fer Kripes sake!
I ‘m loving it, propbaly stopped in London for a day to pick out a new hat for the occasion…….” Hmmmmm lets see, what kind of hat goes with political blood?”
Can we boot out the Senate at the same time? useless hacks that do nothing but rubber stamp the sitting govts new laws. WHY do we need them?

#75 Anti_tony on 12.03.08 at 7:53 pm

The people that spend and spend just to support consumerism are the norm. Tony embraces the norm. Its a bad thing to actually have a life and not be caught up in the rampant keeping up with the Joneses. Tony is probably one of those idiots in Calgary who is supported by the oil economy and as a manager is about to be laid off and wont know what to do to pay his $10,000 a month mortgage for his house in the SW affluent area(big house) on a small lot. He can pass salt and vodka(stirred not shaken) to his neighbour across his deck as they are 3 feet apart. Luckily his neighbours young son hasnt learned about matches yet. Look for Tony’s foreclosure on http://www.conservativesaredumb.ca

#76 American Funds on 12.03.08 at 9:04 pm

Seeking advice from the wise here…

My business earns its money in US funds, which means I have a fair bit of my holdings in US dollars.

Is it better to keep my money in U.S. dollars or convert to Canadian? Any thoughts, suggestions?

#77 Bottoms_Up on 12.03.08 at 9:06 pm

“this article is a true gem….listen to how the president of century 21 spins every question that’s posed.

any folks wonder why realtors are losing credibility?”
——————————————————-
a follow-up to the ‘buy, buy, buy’ recommendation:

In Ottawa, a 3 bedroom 2 bathroom bungalow recently posted for 179,900, then 149,000 (a 17% drop in price and still no takers):

http://www.ottawaliving.ca/sold_property.php?property_id=3250

http://www.ottawaliving.ca/sold_property.php?property_id=2749

#78 de Gaulle shadow on 12.03.08 at 9:11 pm

What was Freedom 55 and which outfit touted it?

#79 Bottoms_Up on 12.03.08 at 9:12 pm

#68 neutral on 12.03.08 at 5:59 pm
———————————–
Hi Neutral,
Thanks for the story and concern, but I think many people here are just having fun with the ‘squirrel’ thing. If it were ‘serious’ (which it could very well be in a few years) I don’t think we’d be sitting around blogging about it. Also, in China they eat anything that lives, so I’m sure squirrel wouldn’t be all that bad.

Please share some more insight into how to best prepare for the coming storm.
Thanks!

#80 Mountain Girl on 12.03.08 at 9:14 pm

midas #49,
Um, I have a question.
How are any of us supposed to save your post to reference a year from now if by then we are indeed living in the Dark Ages and don’t have any electricity?
Never mind being broke, at war, really hungry, and probably dead?
I had to ask.
Even the apocalypse deserves a little logic, don’t you think?

As for the rest of you, my money is on the squirrels.
I plan to join them, actually.
From now on, I would like to be known as “Squirrelly Temple: Bright-eyed and Bushy-tailed”. Or Nutsy. You can also call me Nutsy.
Bring on the doom!
(insert death-defying xena-warrior-princess battle cry here)
(followed by angry squirrel chatter)

#81 Bottoms_Up on 12.03.08 at 9:22 pm

#76 American Funds on 12.03.08 at 9:04 pm
——————————————-
I’m not an economist, but I’m hearing that longer term those american dollars may not be worth very much. I’d be tempted to hedge your US dollars against (hyper)inflation. (maybe put 5% of your profits in gold)

On a related note, I heard the US and Beijing are meeting soon regarding currencies, and China wants to keep their dollar undervalued to maintain their export economy. If the US currency hyperinflates, they will not be able to import, and being China’s largest customer, will adversely affect China’s economy. Everything is so intertwined!

#82 Ste-Anne-de-Bellevue on 12.03.08 at 9:27 pm

the link is in French, here is a short translation: Famous investor Stephen Jarislowsky agrees that real estate is over priced by 36.5% in Canada. Over the last 7 years house prices went up 100% whereas the annual inflation was 2% and the increase in productivity was 1.5% per year which should have resulted in an increase of only 27%.

Amazing how everyone now agrees that prices will decline, but the true pioneer was Garth, thanks.

#83 $fromA$ia on 12.03.08 at 9:29 pm

Gath , if theres another election soon will you run again?

And forsake you? — Garth

#84 Rasputin on 12.03.08 at 9:41 pm

Fred Thompson on what we (North Americans) are facing.

http://kontentkonsultvideo.blogspot.com/2008/12/we-have-to-double-down-on-borrow-and.html

#85 Rasputin on 12.03.08 at 9:43 pm

#76 American Funds.

If the three stooges coup goes through, how fast can you say 25 cent Canadian Dollar?

#86 squidly77 on 12.03.08 at 10:08 pm

when dion gave his speech tonight..on the left side of the screen just above his head (all i could see was 3/4 of his head) there is a book titled *HOT AIR* dead serious its easy to see..and i am left wondering if it was recorded on a cell phone..hilarious

#87 JO on 12.03.08 at 10:23 pm

Tony/david

Your posts are interesting but bring to the fore a major issue: The cause of this crisis is quite complicated but a serious contributor was in fact that many in the Western world simply lived well above their means and practiced reckless money management. Your friendly government folks, including the Federal Reserve in the US and our central bank who follows them, did everything possible to make debt slaves out of all willing participants by lowering rates and allowing enormous amount of debts to accumulate. They were only able to do this, in conjunction with the chairmen and boards of directors of most large banks (most of whom are directors of the Fed system), because a large number of people were able and willing to take on the debt that was requested by them. Anyone who drove a Lexus instead of a Camry, who ate at luxury restaurants several times a week instead of once a month, and in general lived on debt is not a victim. The true victims are the savers whose deposits in the form of GIC/Terms were used as the source of the credit issued.Other victims are the segment of the population who did manage life frugally, saved money and lived responsibly. These people will now see lower GIC/interest rates, higher income taxes and other forms of taxation over the long run to help pay for deficits, and lower home prices as many of their neighbours who were silly with their money (and probably got in under the ponzi scheme enabler called cmhc with 5 % or less as a down payment) now blame everyone but themselves and seek populist/left wing politicians who want donations and votes. It seems like both of you may have been part of the mainstream live for today and houses/stocks always go up crowd. Markets go up and down. Unfortunately, when markets go down, many investors want someone to blame other than themselves and are jealous and angry at those in the small minority whoe avoided the mess. I encourage you to be contrarian and take responsibility for any actions you may have taken. Most of here were either brave enough to be contrarian (and suffer ridicule from the majority) or lucky to have been in a position to avoid this, and most of us do not live in basements.
Best of luck to both
JO

#88 BC Resident on 12.03.08 at 10:44 pm

“”Vancouver prices, by the board’s count, fell 13% between May and November…..but in some areas the decline far exceeded that.””

…..You forgot to meniton that in other Vancouver areas prices fell less than the 13% average!!!!!!!!!!!!!!!!!!!!!!

Balance your reporting.

Don’t worry too much about Vancouver…..There are only about a 1 million residents out here…3 million in the whole province.

Its better to worry about Ontario….an overpopulated, manufacturing province…sitting adjacent to a defunct U.S. car industry.

just my two cents

Ah, did I hurt your feelwings? Anyway, cough up some links on Van hoods that are holding their value. — Garth

#89 The First Rick on 12.03.08 at 10:49 pm

#68 neutral on 12.03.08 at 5:59 pm
=============
Oh, the “it could be worse” retort.

Retard!

#90 Wealthy Renter on 12.03.08 at 11:02 pm

http://www.torontorealestateboard.com/consumer_info/market_news/mw2008/pdf/mw0811.pdf

I am surprized nobody has posted this yet.

Toronto prices down 10% Nov 08 to Nov 07
Toronto sales down 55% (same period)

So sad.

#91 dd on 12.03.08 at 11:04 pm

Intesting times. Scotia and TD are “suppose” to be in better position that the other bank.

#92 dd on 12.03.08 at 11:10 pm

#68 neutral

“You guys just scare each other and make yourself even more scared”

Neutral there is truth in what you write. However it is a scary time. Running off a cliff and people don’t know where the bottom is.

I think most people on this site seem prepared. Little debt, renting, no major purchases.

When you are more aware of externals or thinking against the herd it is not easy. It is down right scary sometimes.

#93 charliegosurf on 12.03.08 at 11:41 pm

Hannibal L

now that i really think about it, soylent green gave me an idea for ultimate new age cuisine…the squirrels are just appetizer tony and neutral, you guys are on the menu, bbq style, mium.

watch that show about hawaiians the other day were the governement sponsors the native culture to teach them their traditional ways…they were practicing witn a couple pigs in the pit coered with banana leafs!

we are in war time as far as i know, they dont call it a world war yet, just a war agains terror, always make sur to remember what the terror issue IS…love the basement, favorite place in a house, and my balls are fine ask my wife…

leadership, i work on it evry single sec of my life, these times are exacttly what this planet needs to wakeup, all the tony’s of this world love to sheep around to greed on eternal green grass and we for sur cant smoke it, less for you to lust on,lol

i luv this

#94 charliegosurf on 12.03.08 at 11:54 pm

mountain girl i love you please keep on shavin tought, lol, anyhow ever wonder were Charlie is from???

http://en.wikipedia.org/wiki/Apocalypse_Now

like the World of reasoned people going up the river of greed to go get the Tony’s,lol in the heart of darkness!
were on the beach battling it out right here now, you wont believe that surfer dream of mine i had awake yesterday, it is THE Answer. to at least the political nightmare this country is.

#95 pjwlk on 12.04.08 at 12:06 am

#61 Tony: Your logic is flawed my friend. I think we would have gotten along just fine without people spending there way into a massive bubble. While living within one’s means people are still spending and keeping the “economy rolling”, just at a more reasonable rate that’s all.

#96 Derrin on 12.04.08 at 12:29 am

Pjwlk #95

Bubbles are good. They clear out the riff raff.
Then we get to play again.

#97 Future Expatriate on 12.04.08 at 1:28 am

#76, if you really want to play the Forex game, the next time the Loonie achieves parity with the US dollar, convert everything then. The US dollar crash will be in, and the Loonie should end up permanently higher than the US dollar from that time forward as it’s backed by more gold and a country with more wealth and not in hock up over its head.

#98 David on 12.04.08 at 4:21 am

JO, thanks for the warm message. Have you read any of my many frequent posts on this blog and if you have, do you apprehend ANY of my contrarian messages?
Populists? Ever hear of that great pseudo populist Ralph Klein in Alberta? How about Preston Manning?
I have advocated consistently for higher equity mortgages and against 0% down speculation and that makes me a basement dweller?
The people who avoided the mess are called RENTERS.

#99 jelly on 12.04.08 at 4:40 am

neutral,

I can’t believe you thought Calgary Rip Off was a woman, or were you being sarcastic? He is totally
a man’s man as they say and I do not mean he plays for the other team! (he will probably be complimented)
As for your hardship years, I am suprised you do not sound really worried as you lived through such hard times. Perhaps you are right that it could never get as bad as it did in your country, we really do not know as it is all new to us.
Don’t you think it best to prepare for the worst and then hopefully be pleasantly suprised?

#100 jelly on 12.04.08 at 4:47 am

Mountain Girl,

You’re Hilarious!

#101 patriotz on 12.04.08 at 5:05 am

I won’t even go into the fact that every Olympic city in the last few decades has experienced a post-Olympics real estate crash…

Calgary didn’t, because the market had already crashed beforehand (1982-85). The Calgary market didn’t start recovering until the 1990’s. Vancouver seems set to match Calgary with a pre-Olympic crash.

http://cuer.sauder.ubc.ca/cma/

BTW Papa Smurf, the Calgary bust has been underway since summer 2007 and is now down about 15%, with probably another 15% to go. Calgary never got anywhere near as expensive as Vancouver.

#102 dotava on 12.04.08 at 2:54 pm

#90 Wealthy Renter on 12.03.08 at 11:02 pm

Sorry Buddy – you are “delusional” ;-) prices always just go up and up and of course in this proportion (in somebody dreams).
But guys we pass that point where house prices are important – anyway I enjoy reading this blog more than others.

#103 dotava on 12.04.08 at 2:59 pm

#91 dd on 12.03.08 at 11:04 pm
If we eat the [email protected] from the same bowl (NA/global economy) – how you expect that your side is better/worst than mine? Somebody have smelling problem here or never smells the [email protected] before.