Gregg does Garth

Pollster, CBC television pundit and veteran political observer Allan Gregg interviewed me on his TVO program this past week. The subject: After the Crash, and an examination of just how scary a guy I really am. — Garth

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81 comments ↓

#1 whateva on 03.07.09 at 10:00 pm

first!

#2 nonplused on 03.07.09 at 10:07 pm

Where can we find the rest of the interview?

#3 deflation on 03.07.09 at 10:14 pm

great
would love to see some more footage

#4 rural route on 03.07.09 at 10:15 pm

Can we see the whole interview? On the TVO site it only has these two short versions as well. I’d really like you to post the full half hour Garth.

#5 Jon B on 03.07.09 at 10:29 pm

Garth, I don’t think you’re scary. I would say however that you appear to have a split personality between your public appearances and the written entries in your blog. I found your recent talk in Surrey BC pretty tame compared to some of the opinions you share in many of your posts.

Meow. — Garth

#6 Taxpayer like you on 03.07.09 at 10:56 pm

Garth – you are such a warm fuzzy guy on TV, hardly the fire-breather we get on this blog. Oh the anonymity of
the net…..

Question for Garth and all bloggers: Given the uncertainty of banks/runs/holidays/deposit insurance, just how
should we hold “cash” in accounts? Are T-bills any safer, more convenient or “cashable” than deposits given a disruption?

60 minutes (no no not the hour) is having a report on US bank failures. Anybody know how comparable their deposit insurance mechanism is to ours?

#7 Happy Renter in North Van on 03.08.09 at 12:08 am

When I saw “Gregg does Garth”, I thought I accidentally stumbled onto a Gay XXX website…

Garth, you gotta be more careful with your wording ;-)

#8 landlord on 03.08.09 at 12:15 am

Garth i’m dying to know, what do you plan to do with your new property?

#9 TheComingDepression on 03.08.09 at 12:30 am

#6 Here are are so called “SAFE” BANKS:

Royal Bank ($624 billion assets) ; $4.8 trillion total derivatives ; $4.3 trillion OTC derivatives

TD ($432 billion assets) ; $2.4 trillion total derivatives ; $2.1 trillion OTC derivatives

BMO ($387 billion assets) ; $2.7 trillion total derivatives ; $2.0 trillion OTC derivatives

Scotiabank ($429 billion assets) ; $1.3 trillion total derivatives ; $1.2 trillion OTC derivatives

CIBC ($344 billion assets) ; $1.2 trillion total derivatives ; $1.1 trillion OTC derivatives

#10 wb on 03.08.09 at 1:43 am

I’d agree with “Jon B”:
Garth, I don’t think you’re scary. I would say however that you appear to have a split personality between your public appearances and the written entries in your blog. I found your recent talk in Surrey BC pretty tame compared to some of the opinions you share in many of your posts.
and “Taxpayer like you”:
Garth – you are such a warm fuzzy guy on TV, hardly the fire-breather we get on this blog. Oh the anonymity of
the net…..

Not the Harley riding tough guy I thought you were.

#11 Bemused in BC on 03.08.09 at 3:05 am

AP: “When [US] economy bottoms out, how will we know?”

“When will this wretched economy bottom out? The recession is already in its 15th month, making it longer than all but two downturns since World War II. For now, everything seems to be getting worse: The Dow is in free fall, jobs are vanishing every day, and one in eight American homeowners is in foreclosure or behind on payments.

But the economy always recovers. It runs in cycles, and economists are watching an array of statistics, some of them buried deep beneath the headlines, to spot the turning point. The Associated Press examined three markets — housing, jobs and stocks — and asked experts where things stand and how to know when they’ve hit bottom…”

http://news.yahoo.com/s/ap/20090308/ap_on_bi_ge/economy_where_s_the_bottom

#12 SaraBeth on 03.08.09 at 6:53 am

Living on a fixed income it is hard to put cash aside…but little by little I have aquired about $1000.00…. But my question is this…

Is that $1000.00 actually going to be worth anything when things fall apart?

Personally, I am planning on buying some pre-’64 silver coins.

#13 Moi on 03.08.09 at 7:27 am

Here’s the link to the full interview
http://www.tvo.org/TVO/WebObjects/TVO.woa?video?AG_Int_20090306_907839_GTurner

#14 David Bakody on 03.08.09 at 7:33 am

#12 SaraBeth on 03.08.09 at 6:53 am

Save your hard earned cash in a TFSA .

As far as the TVO sounded just fine to me, professional writing are always open to edit, live TV or Stage is just that ….. good interview.

#15 Ding on 03.08.09 at 7:42 am

#2, here you go, full interview
http://www.tvo.org/TVO/WebObjects/TVO.woa?video?AG_Int_20090306_907839_GTurner

#16 Munch on 03.08.09 at 7:56 am

Munch says “Farewell Americano”, and includes Canadians in that greeting

Munch has reached the conclusion that Murrika will slide into the sea, very soon – a sea of anarchy and urban rioting, that is

Munch thinks there is just too much to save, there is no hope of saving it, without severe negative consequences

This is the observation of an Outsider

Farewell Murrika, see you on the other side

{doffing hat}

#17 Save on 03.08.09 at 8:46 am

The rest of the preview video is at this site:

http://www.tvo.org/TVO/WebObjects/TVO.woa?video?AG_Int_20090306_907839_GTurner

#18 Rosemary on 03.08.09 at 8:58 am

Hi there – to be honest, I’d never heard of you before I happened to watch the show on TVO this evening, and became very ‘glued’ to what you were saying. I’m a fairly naive (but sensible) sort of person who kind of does the best I can without much professional advice. I really enjoyed listening to what you had to say, and not only that, I found you to be very charming in the way you expressed yourself.

Thanks for your insight.

Best wishes,

Rosemary

#19 Raymond on 03.08.09 at 9:00 am

Hello Mr. Turner,

Just listened to your interview on TVO about your new book.
I have always found your views very inspiring and intelligent.
I was also very surprised and disappointed that you had not been successful at the last election as I understood
early that you were a true public servant with much to offer. But I also very well understand what happens in that arena.
I am interested in reading your book and am contemplating reading it therefore buying it.
Thank you for your straight forward approach to issues. It is time that more people of your convictions be heard and lead.
My son`s favorite saying is …I call it real like a piece of blue steel….. Few words that say a lot.
That is the generation.

Regards,

Raymond

#20 Kash is King on 03.08.09 at 9:03 am

omg

http://www.moneyandmarkets.com/your-last-chance-before-all-hell-breaks-loose-2-30041

#21 SaraBeth on 03.08.09 at 9:19 am

#14 David Bakody on 03.08.09 at 7:33 am

Putting it into a TFSA would still mean I wouldn’t have it on hand when needed…I would have to get if FROM the bank….and if they froze accounts, what then, eh?

No thanks. My little hidey hole will do nicely…

#22 jess on 03.08.09 at 9:33 am

In finance theory, an arbitrage is a “free lunch”—a transaction or portfolio that makes a profit without risk.
hum……..i guess some are finding this supposition not so true.

Aviva has had to calculate what the losses would be if the investments were cashed in now under a new European accounting standard known as market consistent embedded value (MCEV).

Under the old IFRS approach, insurers would mark to market their investment holdings in bonds, property and equities.

Al Rosen’s question he poses in the financial post :
Why would canada switch to IFRS even though cash flow reporting under those rules is weaker than currrent canadian standards. hum…..makes ya wonder.

Good article by al and mark rosen page 5 financial post saturday march 7, 2009

http://www.riskglossary.com/link/arbitrage.htm

Techniques of financial engineering have been extended to fixed income derivatives, which generally require the modeling of entire term structures. They have also been extended to commodities markets, where risk neutral valuation becomes problematic.

#23 Cendrine on 03.08.09 at 9:57 am

Thanks to all who provided links to the full interview.

That was a good interview, Garth. It helped clarify a few points regarding the future of suburbs, whether it is a good time for me to buy a home (yes, because even though the economy and RE are declining, I can buy for cash and live in it for another 10 -20 years) and you provided some encouragement regarding the stock market. I might even look into oil stocks!

You are not an apocalyptic doom and gloomer. I appreciate your ability to see the sliver lining in the black economic clouds.

Gotta get back to stockpiling some more food and finishing the bad day box, though….

#24 Pud on 03.08.09 at 10:21 am

#20 Kash is King –

What’s the big deal? Invest in high-volume put options. This is a glorious time to be a derivatives trader.

#25 Prairieboy on 03.08.09 at 10:33 am

What is happening to home prices is not new were I come from. My brother just out of university got a good job in a village and built a new home at a cost in 1982 of $125,000 . It took 25 years and a total cost of $250,000 but the home is now payed off, free and clear. This home is 2500 sq ft and he spent alot of time and money on keeping it up over the years . This home is worth only $25,000 today. He will have to move it to another community in the province before it can be sold or just live in it until he dies of old age in a village with no services left after 25 years. Small town Saskatchewan a slow and painful death and a Booming Economy ,Yah Right!

#26 Another Albertan on 03.08.09 at 11:16 am

@81/Vancouver_Renter from the last thread: (I don’t want this post to get lost…)

Don’t worry, buddy… I’m with you in principle. I’ve also observed many of the things you have seen and professionally I’m a variant of you, albeit about 10 years younger. That puts me dead centre of the Baby Bust (72 to 75) – a situation that has its own challenges.

In the last 20 years of working everything from summer through to professional jobs, I can really only count the period of 2002 to 2007 as being noticeably “upward and stable”. Prior to 2002, even the entry-level and junior professional jobs barely paid and through a lot of the 89-02 period, I was just lucky to even get a job in most cases!

#27 TheComingDepression on 03.08.09 at 11:30 am

I still don’t understand you Garth with the ‘cash is King” thing. Gold/Silver is King and it is has for THOUSANDS of YEARS. My year 2000 purchase of Gold at $400 and silver at $4 has trumped your CASH is King all the way to the bank. Its TAX free, easy to store ,preserves wealth and goes UP in Value as opposed to your “CASH” that has slumped. Hit your local coin shop or craigslist for a few thousand of preserved WEALTH. Your video was way too tame by the way. Tell it LIKE IT IS!

#28 TheComingDepression on 03.08.09 at 11:39 am

Newsweek on Gold and Silver INSTEAD OF CASH

http://thecomingdepression.blogspot.com/2009/03/cash-in-mattress-no-gold-in-closet.html

#29 Zoe on 03.08.09 at 11:40 am

Jon Stewart did a hilarious run-down of the ‘wisdom’ of Wall Street over the last year and my favourite comment was: “If I’d listened to these guys, I’d be a millionaire today! … provided I’d started out with A HUNDRED MILLION.”

#30 Jeff Smith on 03.08.09 at 11:44 am

That is crazy scary! Where did you get this data?

********************************************
#9 TheComingDepression on 03.08.09 at 12:30 am

#6 Here are are so called “SAFE” BANKS:

Royal Bank ($624 billion assets) ; $4.8 trillion total derivatives ; $4.3 trillion OTC derivatives

TD ($432 billion assets) ; $2.4 trillion total derivatives ; $2.1 trillion OTC derivatives

BMO ($387 billion assets) ; $2.7 trillion total derivatives ; $2.0 trillion OTC derivatives

Scotiabank ($429 billion assets) ; $1.3 trillion total derivatives ; $1.2 trillion OTC derivatives

CIBC ($344 billion assets) ; $1.2 trillion total derivatives ; $1.1 trillion OTC derivatives

#31 Basil Fawlty on 03.08.09 at 11:51 am

Enjoyed your interview Garth.
Number 9, where did you get those deriviative figures for the Canandian Banks? I was wondering for some time how deeply they were invested in those toxic assets of financial destruction.

#32 Kash is King on 03.08.09 at 12:15 pm

#24 Pud, hopefully the institution holding/running them stays afloat… sure. Just never gamble more than you can afford to lose.

#33 Johnny Five on 03.08.09 at 12:32 pm

Well done interview Garth. I think you got your points across very well. I saw your The Hour interview and it was too short. It came off more as a sales pitch. This interview really allowed you to discuss the fundamentals of your views and I hope a lot of people get the chance to see it.

#34 HJD on 03.08.09 at 12:38 pm

Re Gregg and Garth – nicely done.

#35 ralph on 03.08.09 at 12:51 pm

You still have to exchange your gold for cash in order for it to be of any use. Worst case scenario is if the banking system failed, there is a major power outage, huge line ups at your local bank, etc.

How would you cash in your gold? At that point your gold would be pretty much useless except for maybe its aesthetic appeal.

#36 confused and a little crazed on 03.08.09 at 12:55 pm

Hi guys,

apoint of interest apparently the popular cartoon ” The Simpsons” will be doing a show dedicated tio foreclosures sun. WE all could use a laugh in these tough econ times.

Homer is being foreclosed on

#37 deflation - Toronto on 03.08.09 at 1:12 pm

just saw the whole interview
once again thanks for the link

#38 Taxpayer like you on 03.08.09 at 1:34 pm

26 AA – please check last thread for my discussions with VCR too.

Your observation of 89-02 sucking may also be more personal experience than general trend. Remember the rescession of the early 90s? I dont. We like to say “we went home early that day”. That’s how it was for me, but it really sucked in the late 90s. I think if you picked the wrong industries/locations during that time it coulda
sucked for the full 13 years. Just to clarify, I dont mean you did anything wrong, just some bad luck.

But you are now perfectly positioned. Yep, just luck again
in being born when very few others were. As the boomers retire, or elect to slow down, you’ll be in charge, with an increasing “echo” both working for you and hopefully creating demand for your services.

#39 robert on 03.08.09 at 1:46 pm

So I’m lifting a pint in the local Irish pub with a crew from work last night. To my left is the receptionist’s boyfriend, a early 20ish Commerce grad. “What’s your line of work?” I ask just to get the conversation rolling. “Financial Planner”, he says with absolute sincerity, “I’ve been doing this for the last year and a half after finishing the training”. “Must be tough right now” says I, thinking that he must be seeing the writing on the wall. Given the opening, he launches into the low-risk, high-risk sales pitch that he’s been programmed to deliver. I’m curious so ask him if he’s a student of history (seeing as he keeps referring to historic trends and economic cycles). “Not really” he says with that puzzled expression that means “why should I be?” I experienced this creeping sadness, a bit like a parent who has to explain to his kids that the dog has died and won’t be coming back. Have reached that precipice, I felt it best to change course and return to my Kilkenny and the rowdy chatter at the next table. I just didn’t have the heart to euthanize this fellow’s blind faith, time and experience will do that soon enough. And no, I didn’t refer him to this site either, I’ll save that for the next gathering and the next Guinness.

#40 David on 03.08.09 at 1:58 pm

Some very good points were raised in the discussion. Our “envy of the world” Canadian banks got a $75 billion plus bailout with no public discussion. At no point, was the issue of the actual solvency of those institutions ever in question. That money went directly into the bank vaults and the taxpayers are on the hook for questionable assets. The qualifications for bailout funds by all appearances, is financial institutions making vague references to dire consequences from government not responding to stick up notes.
There is no historical record of private banks dropping AAA assets onto the public sector in Canada. Kiss that bailout money goodbye.

#41 Jake on 03.08.09 at 2:08 pm

#6 Taxpayer like you said…

“Garth – you are such a warm fuzzy guy on TV, hardly the fire-breather we get on this blog. Oh the anonymity of the net…..”

As far as I am aware, Garth is the only one on this blog that is not hiding behind anonymity. He’s the only one with a reputation on the line here. You have to be a little warm and fuzzy on TV to get people to start looking for the truth. Otherwise, they will dismiss you as a crazy fool and change the channel back to American Idol. Nice work Garth.

#42 SaraBeth on 03.08.09 at 2:11 pm

#35 ralph on 03.08.09 at 12:51 pm

WTSHTF I’ll bake you a loaf of bread for a silver quarter… Two silver bits will get your shirt washed and ironed.

A gold half-dollar will get you a meal at my house.

*serene smile…*

#43 dg on 03.08.09 at 2:27 pm

Nice interview.

I have one question: In the interview you paint the picture that what we are doing(N America) is much the same as Japan did. Low interest rates, massive spending on infrastructure and similiar demographics(with a lag).
In the interview you then say later this will lead to (hyper)inflation and rising interest rates.
If Japan is 10 to 15 years ahead of us why have we not seen this in the Japanese economy?

Cheers,

Because it did not work there. The difference was a single national government trying to reflate then, versus a global approach now. — Garth

#44 Grantmi on 03.08.09 at 2:42 pm

I just crossed the border this morning into Blaine for my weekly tank of gas. ($2.10 US$ BTW = $0.71 CN$)

Anyway!

When crossing back into Canada at the Truck crossing… there’s a big FORCLOUSER sign on a plot of land just as you come out of the border.

I’VE NEVER SEEN THIS EVER!! B.C. land in Foreclosure! WOW!!!!

Can’t happen here in BC! Nope… not going to happen!
… (cue taps music here…)

#45 jess on 03.08.09 at 2:42 pm

crazy numbers was posted on the link below regarding derviatives

http://forums.canadianbusiness.com/thread.jspa?messageID=281688
====================
-Here’s a list of american tallies
mortgage -http://ml-implode.com/
bank closing -http://bankimplode.com/#rundown
hedge funds – http://hf-implode.com/index.html#lists
—————————————

#46 Sun Yat-sen suit on 03.08.09 at 2:47 pm

Garth your books and blog have more substance than what I saw on TVO Friday night.

#47 Brett Carels on 03.08.09 at 3:05 pm

Something very little people talk about is the Credit Card debt Americans have. On Average an American owes 17k+ on their Credit Card. A family of two would be 34k on their credit card alone.
One year of saving will not pay for this. Two years won’t. Lose your job and your not paying for it and your not consuming.
Am I missing something? Or are we in for a second coming when people start talking about this!!!!!!!

#48 Grantmi on 03.08.09 at 3:08 pm

Hi Garth;

Loved the interview… but I do disagree with you on your movie theater business comments.

Interesting enough…. movies attendance goes up during bad times. (as it did during the 1930 depression)

http://tinyurl.com/CinemaBiz

#49 wjp on 03.08.09 at 3:15 pm

Garth – you are such a warm fuzzy guy on TV, hardly the fire-breather we get on this blog. Oh the anonymity of
the net…..

# 6 by Taxpayer like you…

Yes Garth is really hidden on the blog…one would never know who it is…LMAO…I guess there was a point somewhere!

#50 jess on 03.08.09 at 4:01 pm

I agree that the worst is yet to come since
quantative easing is the morphine for the (restructuring pain) that still to come.
out goes quantity in comes quality.
Japan learned that soft landings and too big to fail costs lots of billions of yen later….

#51 canuck on 03.08.09 at 4:29 pm

Thomas Walcom asks, “Will the economy get worse?
Hold on to your hats, because this global emergency is eerily like the Great Depression in several crucial respects. If we’re wise, we’ll heed history and hunker down for a long, tough haul”

This economic crisis is nothing more than a world-wide liquidity call. Do the banks have enough to pay all their depositors when there is a run on the bank? In many cases, especially in the United States, the answer is no—they’re broke.

Do you have enough liquidity if you lose your job? Have plans for getting another one? Have enough cash put by while you’re looking for one? How long does your stash last? Is mortgage paid off, do you own your cars and other assets? How much cash do you owe in relation to your assets or could quickly sell (liquidate)?

FDR’s stimulus spending didn’t work. It was the rise in production during WWII that allowed western countries to become liquid again. The reason the world is in such a financial mess is very few countries can pony up the cash to pay their bills. China is a nation of savers, and may recover much quicker.

Garth, thank you for continuing to tell it like it is!

#52 Taxpayer like you on 03.08.09 at 5:01 pm

WJP/Jake

I guess “anonymity” wasnt the best choice for a word.
But then again Ive never met Garth, and only seeing
video on-line, can I really be sure he even exists??

And why wouldnt people want to see the fire-breathing Garth on TV?

#53 Jake on 03.08.09 at 6:02 pm

What’s your pledge?

http://www.youtube.com/watch?v=51kAw4OTlA0

That is one dangerous vid. — Garth

#54 eddy on 03.08.09 at 5:30 pm

that is a good interview, Ontario tax dollars were well wasted in this case- ‘educating’ viewers with the “uncomfortable truth”

#46 credit cards.

rates are .5% isn’t that great? but if you need credit,the cards are 19%, and the structure of mortgages means you pay for the house twice over.
dick morris reminds us in his book, fleeced, that about 2% is blended into most consumer goods- computer stores on kennedy rd charge a premium for credit cards but 99% of retailers don’t, which means everyone pays extra, jut try asking for a cash discount

#55 Jelly on 03.08.09 at 5:42 pm

Garth is the only politician that makes me believe he is telling the truth and teaches us what he thinks instead of the typical drivel, lies etc. that come out of people like Bush and Harper.
Do they actually start believing their BS?
How do they sleep at night, seriously?
Garth, you are very interesting to listen to, people
are idiots for not voting for you.
Yeah guys, let’s just vote for people that tell us our country is in great shape and nothing bad can happen financially, job security fine, blah, blah, blah.

I weep for humanity, most people are so mentally deficient and stubborn, they screw everything up for the rest of us.

#56 canuck on 03.08.09 at 6:06 pm

Garth, watched the entire interview on TVO. More voices, similar to yours will increase.

Can modern central banks with fiat money print themselves into liquidity by increasing the money supply without their being any value attached like the previous gold standard or manufactured goods that people are willing to buy? Or is this just their way of introducing inflation into the system which historically is their preferred method?

If you don’t think increasing money supply will work, how might central banks play a role? Has Canada ramped up its currency supply?

#57 Chris S. on 03.08.09 at 6:07 pm

Great interview, Garth. If only more people could get the message, we’d be a lot better off. Thanks for posting this.

#58 Investx on 03.08.09 at 6:13 pm

47 Grantmi: Hi Garth;

Loved the interview… but I do disagree with you on your movie theater business comments.

Interesting enough…. movies attendance goes up during bad times. (as it did during the 1930 depression)

http://tinyurl.com/CinemaBiz
———————————————————

Heard this as well on CNN “Your Money” program today. Cinemas are doing well. I would have assumed otherwise.

#59 Bill-Muskoka (NAM) on 03.08.09 at 6:39 pm

Meow. — Garth

Oh Good Grief!!! Tell me you are not that man-cat on the Whiskas’ comnmercial! P-L-E-A-S-E!!!!!!!!!!!!!!!!!

Now, GET OFF THE COUCH! LOL

#60 gold bug on 03.08.09 at 6:40 pm

Ralph,
Since when does gold have to be converted into cash? By “cash,” I assume you mean the paper money issued by a central bank.
Gold can be traded straight across for goods or services or other things that are used as “cash” when the final stage of this financial calamity kicks in.

#61 Barb the proofreader on 03.08.09 at 6:50 pm

#36 confused and a little crazed ”The Simpsons” will be doing a show dedicated to foreclosures Sunday.. Homer is being foreclosed on”

Maybe I’ll start watching the Simpson’s.

Which reminds me, an email I received from Ed Begley Jr.. he’s reprising his Simpson’s role Sun. 15th.

#62 North Vancouver Citizens Analyst on 03.08.09 at 7:23 pm

Grantmi,

Movie attendance went up in the 30’s because they had nothing else to entertain them.
I don’t know about you, but if times get really bad I’m staying home and downloading anything and everything (not just movies) for free rather than shelling out $20 for 2 tickets to a crappy Hollywood flick.

#63 North Vancouver Citizens Analyst on 03.08.09 at 7:26 pm

Brett Carels,

You are indeed correct, the credit card mess is the next shoe to drop.
This is going to get absolutely horrific.

The perfect storm rages on…

#64 Jonathan on 03.08.09 at 7:39 pm

Harvard University professor Robert Barro said in a Bloomberg Television interview. Barro calculated a 30 percent chance the U.S. will slide into a depression, which he characterized as at least a 10 percent drop in gross domestic product.

Source:
http://www.bloomberg.com/apps/news?pid=20601103&sid=a2sWlnEIj58U&refer=news

#65 ralph on 03.08.09 at 8:41 pm

to SaraBeth:

I’ll right over!

#66 ralph on 03.08.09 at 8:55 pm

to SaraBeth:

That should have been…….I’ll be right over!

I guess I was a little nervous.

#67 ralph on 03.08.09 at 8:58 pm

to SaraBeth:

I meant to write……….I’ll be right over!

I guess I was a bit nervous.

#68 dd on 03.08.09 at 9:07 pm

#27 TheComingDepression,

Gold doesn’t pay interest or dividends.

#69 Don A on 03.08.09 at 9:15 pm

Taxpayer like you

I went to a meeting and can honestly say “Yup, Thats Garth”! Just as he exists in all his glory.

#70 Basil Fawlty on 03.08.09 at 9:44 pm

When Japan entered their recession in 1989, they were the worlds largest creditor nation with a large manufacturing base, selling quality products worldwide.
The US is the worlds largest debtor nation and has little manufacturing left after NAFTA and Globalisation. The last 15 years have seen the US conomy held up by the Tech Bubble and then the Credit Bubble.
When WW II ended the last depression the US was the worlds largest oil exporter, biggest creditor and maintained the worlds largest manufacturing capacity.
What does the US have to fall back on when this downturn is over? Well unless they discover a new productive capacity, such as a perpetual energy source, there is nothing. Look out below…

#71 Coho on 03.08.09 at 9:49 pm

Garth,

That was a great interview! It was informative and you gave some good advice.

But, I don’t feel things will get “better” in regards to material (financial) prosperous times ahead. I believe the agenda of the Ruling Elite, on the archane level, is to use this crisis to abolish the middle class. That is why all western governments are insanely trying to use more debt (what got us to where we are today) to reflate the economy again. They’re all on board to make things worse for the people.

However, from a prosaic standpoint I felt your outlook was quite spot on and may very well help people make some wise decisions in their financial affairs.

I hope your view of our society going through a reassessment of itself and possibly establishing a component of spiritual grounding on the back end of this crisis, particularly if it becomes protracted, will manifest.

If things get bad enough for long enough, indeed people won’t easily forget, and some may greatly benefit in a spiritual sense, which in my opinion, is the key to true and lasting happiness.

Many of us are labelled as “doom and gloomers”. In a sense, I fit that label, but there are different reasons for such an outlook. I suppose it depends what is in one’s heart. Some people, not having done well financially (and obviously not in a good spiritual space) want to see financially successful people fall down to their level. As they say, misery loves company.

Others, understandably, hope to gain financially by the deflation and hope to pick up great bargains. Still others just hope to weather the storm and anxiously wait for things to get back to “normal”.

Some of us hope that the underlying cancerous exploitative and predatory global financial system dies once and for all, so that a just and fair system may rise from the ashes. Some of us just don’t want a reshuffling of the deck and things get back to “normal” because on a spiritual level it symbolizes that the evil system has survived. This survival would be the consolidation of yet more wealth and the buying of more time only to make for an even bigger crisis in the future…a crisis our children and grand children will have to face.

#72 Taxpayer like you on 03.08.09 at 10:00 pm

“That is one dangerous vid. — Garth”

I’ll say! It was produced by Oprah!!!!!

68 Don A. That’s good. But just who are you???

I’ll stop now. Truce……?

#73 MBS-guru on 03.08.09 at 10:08 pm

Current active listings in the GTA is approx 30% higher then the same time last year ….. and we haven’t even hit spring yet. Expect an avalanche of ~8000k listings to pop up on mls in the next 4-6 weeks going into May. This would bring total active listings to a record popping 35,000 in the GTA.

#74 Future Expatriate on 03.08.09 at 11:18 pm

#68- Neither do equities nor currency or any other paper investments when they inevitably crash in a fiat monetary system.

In that case, (and make no mistake about it, that’s where we are now and the situation will be getting far worse) holding value trumps NOT holding value.

#75 Future Expatriate on 03.08.09 at 11:22 pm

#48… the reason movie attendance went up in the 30’s is because people didn’t have television, DVD’s, Blu-ray, or 65″ plasmas to beat the theater “experience” hands down: ten minutes of advertisements before the feature, idiots talking back to the screen, loudly answering cellphones in Spanish, and $10 popcorn.

This Depression is different. The theater boom is over.

Remember nightclubs and big bands? They were big the last Depression too.

#76 M I K E in Ajax on 03.08.09 at 11:38 pm

#68
Gold doesn’t pay interest or dividends.

I agree with you dd, however Gold is one of the few things that has been rising in value in these deflationary times. Most stocks got annihilated.
Sure it’s nice to be collecting dividends, but what is the value of these stocks right now? How long will it be for these stocks to go back to their peak?

I agree with Garth that the next wave will be inflation, which usually makes Gold shine even more.

At the end of the day Gold investors invest in Gold to PRESERVE/PROTECT their purchasing power in uncertain times. Gold has definitely been doing that and will only accelerate when inflation storm comes in.

Cheers

#77 Vancouver_Renter on 03.09.09 at 4:57 am

#39 Robert…

A couple years ago my wife’s coworker quit her teaching job along with another teacher and, a few months later, reappears at the school as a “financial planner” representing a financial institution. After a few courses, she was suddenly an expert. She confidently advised the staff to use equity in their homes to borrow and invest in mutual fund products. Apparently, many of them took the plunge.

When my wife told me this I remember responding with, “Oh no. Does she have any idea what she is getting these people into?”

I actually knew the woman, given we hired her as an assistant in one of our businesses years earlier. A nice girl but she had very little understanding of – or interest in – financial history or anything to do with investing.

Recently I heard that she wisely gave up the financial planning career and skipped town.

I sense a lot of people have been getting a lot of bad advice based on the expectation that everything would just continue on as it always has. I call it “rear view mirror investing”.

#68 “Gold doesn’t pay interest or dividends.”

…But General Electric does.

GE share price just over a year ago = $40.
GE share price last Friday = $7.

In the same period gold has increased from CDN$750 to CDN$1,200.

I agree that, in normal times and over the long term, a portfolio should only have a minimal holding of gold as a disaster hedge. Dividend-paying blue-chip stocks have had a terrific track record. But these are not normal times. “Deflationary contraction” rules apply today, so go read up on what happened during the Great Depressions of 1720, 1772, 1825, 1875, and 1929.

#78 pbrasseur on 03.09.09 at 7:08 am

Nice interview, good job Garth. It reminded me of why i like to visit your blog.

#79 Larry on 03.09.09 at 12:16 pm

Good interview Garth and great recovery on which TV station you were being interviewed for :).

Huh? Always was TVO. — Garth

#80 WakeUp on 03.09.09 at 8:35 pm

Great interview. Top marks!

#81 john on 03.11.09 at 10:16 am

Hey Garth, I remember seeing you on TVO ( i think it was may or june 2008) when you promoted your first book. I’m sure (almost) nobody agreed with your views.

Funny how you’re back less than a year later…and i’m sure there are a lot of people who disagree with your views from your current book. Wonder what next year will bring from you on the Gregg show???