The last time I crashed my Harley, it was quite instructive.

Going into that curve, I knew I was in trouble. As my left crash bar ground off on asphalt, I could sense the extent of the damage to come. As the bike slid toward the side of a white SUV and I rolled like a crazed lumpy leather soccer ball into the curb, I knew the moment of maximum impact was occurring.

But, the damage continued. A new Road King totaled. Two pissed-off minivan owners with dinged doors and screaming children, a nice BMW X-series minus a front end and far, far too many spectators. It took months before the hurt, financial and otherwise, stopped.

This is my bad analogy for the economy right now. I mean, how do you explain a day in which the world’s biggest newsprint maker goes belly up, idling 4,000 workers? When Ottawa all but confirms it has given up on GM and Chrysler’s ability to survive? When Canadian bankruptcies surge 22% and, for the first time ever, 6,000,0000 Americans collect pogey in a single week? When America’s second-biggest commercial real estate company goes bust? Is this capitalism racing headlong into a fatal crash?

Actually, no. This is after the crash. This is the damage and debris, the fallout and the failure, the headline-grabbing, shocking consequences of an accident already occurred.

Only now is the extent of the almost-instant collapse of last autumn being known. When stocks tumbled, Wall Street banks folded, credit markets seized and consumers were shocked into paralysis, our world changed in ways we’d not realize until now. For example, when buyers stopped buying, companies stopped advertising. Newspapers saw ad revenues plunge, laid off 5,900 journalists, closed many operations and shed pages. AbitibiBowater sales of newsprint collapsed, leading to corporate failure and the loss of all those jobs in Grand Falls-Windsor, where no replacement jobs exist.

The accident, you see, was far in advance of the consequences.

My view is that the events which will shape the next few years have already taken place. There will be many more corporate failures, some of them spectacular. Unemployment will continue to increase, and – as I have said – a goodly number of the jobless will never work again. This means even as economic growth inches higher, along with inflation and interest rates, there will be no recovery recreating 2007.

That was it. The party’s over. The future is one filled with more expensive money, higher taxes, indebted governments and reduced expectations. We’ve already spelled out the implications for real estate – another year of declines (at least), followed by half a decade of flatlined prices. There will be great opportunities, but not repeating the old ones.

Against this backdrop, what to do?

Asks Ben, in Edmonton: “I am a 27 year college grad still saddled with a fair amount of student loans.  My girlfriend is in a similar situation.  We have been living together and renting for some time, but recently have been considering buying our first home as everyone here in Edmonton is frothing at the month saying that right now is the perfect time to buy your first home.  We have been saving up for a down payment, but I’ve been wondering if these savings couldn’t be put to better long term use.

Would you advise that we continue to rent and make every effort to pay off our student loans?  I have to admit that renting indefinitely is not the most appealing idea.  Will buying a home continue to be a bad financial decision for the indefinite future?  You’ve said that in the coming years, interest rates will rise, which makes sense, but doesn’t that mean that buying a home for folks like us will just become more and more unrealistic?”

Ben, I suspect you know all the answers already. Pay off the loans. Rent, don’t buy. Invest in stuff that will appreciate (like energy and health care companies) not in things that won’t (a house). In the middle of a recession defined by deflation and fuelled with corporate failure and joblessness, with no discernible end in sight, why would you buy a home when you can rent the same one for far less? Wait a year and save tens of thousands of dollars. Meanwhile if you need to build a nest, go and collect twigs.

Better still, buy a bike. Worked for me.


For today’s blog, “The days”, go here.



#1 dd on 04.16.09 at 10:08 pm

Two comments popped out:

“everyone here in Edmonton is frothing at the month saying that right now is the perfect time to buy your first home.” and

“I have to admit that renting indefinitely is not the most appealing idea”

Everyone is frothing … you mean the papers and real estate agents?

Renting indefinitely is no appealing … and so is losing lots of money.

#2 squidly77 on 04.16.09 at 10:19 pm

nobody is frothing at the mouth to buy an over priced pos in alberta..more likely this ben guy is frothing at the mouth in shock and despair as his property value evaporates

hes more likely stuck in the basement of his spec home and subsidizing the smart renters that are living above ground..frothing at the mouth to spend $400,000 on a glued together particle board shack is realtor speak

hes where he belongs..underwater and underground

#3 Shawn on 04.16.09 at 10:50 pm

That’s a great analogy. (I’ve experienced the slow-mo of a bike crash myself but luckily with no other vechicles and no spectators and no major damage).

The part I am not sure about is if living standards will fall. The way I see it if you draw a circle around the earth, humanity was not living beyond its means. It had not borrowed from the martians. In total we were saving in that we were constantly investing in new buildings and infrastructure. Yeah, some was crumbling but overall we were building.

I don’t think in total we were borrowing from future generations since in return for supporting some oldsters the kids inherit 5000 years worth of knowledge and 100 years or so worth of installed instrastructure. Good deal for them.

Our collective capacity to produce has not diminshed so why must our collective consumption?

Just askin’

#4 catamaran guy on 04.16.09 at 10:55 pm

I must confess I am one of those abandoning the newspaper in paper form.

I always used to buy the saturday Globe and Mail..it was sort of a tradition.Now it’s online.

Hmm .I use to go out for breakfast Saturday morning too.times change.

The newspapers also relied a lot on the ever expanding real estate market,and stock market,those ain’t coming back.

#5 Grumpydawgs on 04.16.09 at 11:03 pm

You think the denial in Edmonton is bad? Think back to what the analyst for Credit Suisse said recently about property prices in Spain.

” A 10 to 20% reduction in prices may not be enough if real prices are still 50% too high”.

In Vancouver the price/income ratio is 10.88 X’s average income, the highest in the western world and the newspapers are fomenting that this is the best time to buy.

In Honolulu a commenter regarding the foreclosure rate having gone up 503% this past month stated that

“if the locals don’t buy, then foriegners always will”,

this in spite of a continued downtrend in property prices , transactions, hotel occupancy rates and visitor numbers.

Denial is rampant. There are people everywhere who remain lost in a time , whose final destination no longer exists, like frightened weary dinosaurs, braindead on thier feet.

#6 LS on 04.16.09 at 11:09 pm

Hi Garth, I know you probably don’t have much time to read books between writing so many, but I would highly recommend Proficient Motorcycling by David Hough.

I found it very illuminating.. Hough goes into interesting detail on the statistical causes of crashes and how to reduce your chances of being involved in one.. I think every motorcyclists should read that book, no matter what their experience level.


How sweet. — Garth

#7 Cendrine on 04.16.09 at 11:17 pm

Our experience from the RE trenches:

We have been looking for a house in the Ontario rust belt for the last month. A real treat, let me tell you. We finally found a house and have a conditional offer on it. Because it is an older house, it may need some work, perhaps the furnace or the roof. Depends on what the house inspector finds. The potential repairs may wipe out any profit from the sale fo our current home My dear husband, who had rejected my suggestion that we rent and wait a few months for prices to decline, is still perusing listings and finding that, indeed, a house we saw and rejected (potential problems) has been reduced 15k and that one, the one with the partially finished basement and was deemed too much trouble and expense to finish, is also reduced 15k. He’s driving me crazy with second guessing. In a declining market, you always feel like you’re being screwed, that a better deal could be had if you had just waited a little bit. My opinion is that we would be better off with a less expensive home which would leave more money to put into repairs or waiting for a better price. But what do I know…I listen to Garth and everyone knows Garth is a little off the wall, right?

Does this vulture sound a little frustrated?

#8 Cendrine on 04.16.09 at 11:51 pm

I get a lot of this lately, too….


#9 double mike on 04.17.09 at 12:02 am

“Better still, buy a bike. Worked for me.”

Yeah. I’m considering buying a PWC. Yamaha FX SHO looks quite appealing and the prices most likely will be really, really good this season.

Should work for me.

#10 Sean in E-Town on 04.17.09 at 12:43 am

“In the middle of a recession defined by deflation and fuelled with corporate failure and joblessness, with no discernible end in sight, why would you buy a home when you can rent the same one for far less?”

That’s my problem Garth. I can rent for $750 or carry a 94 thousand dollar one bedroom for $680 at 4.1% after taxes and fees. I’d probably save another 600 a month on top of it, as that’s the balance of my rent and savings over the last 20 months, more than 1300. So, if rates go to 9% when it’s renewal time, I’m looking at a 200 dollar a month jump in payments, a 29% increase, in carrying costs, sure, but with five years’ run-up, lots of time to pre-pay that debt too… sure, I’m ticked that they’re trying to sell for 12 year’s rent, and a yield of 6.5% after condo fees and taxes, but it’s a place to live for an awful long time… I suppose though, the best time to plant an oak is always 20 years ago. Even if the bottom fell out of the Acorn market in the early ninety’s.

Your argument is false. The carrying cost fo a mortgage does not factor in the lost earning power of the downpayment, property taxes, insurances, utilities or maintenance. Together they can double the monthly financing charge. — Garth

#11 Da HK Kid on 04.17.09 at 12:43 am

Well, my move from Hong Kong to KL Malaysia is a go! A completely lowered cost of living by 60% and tax equalization to HK. Oh yeah kids, 15% max income tax and a pure user pay society.

You may want to look into it as things in Canada are about to get worse and I left 7 years ago after the high tech bust, death and taxes and useless government.

As for 27 year old buddy, pay off those loans bro, rent and wait it’s never been a better time to just sit on the sidelines and work hard in your job TO KEEP IT!

Great investment opportunities are coming, non traditional BS ones as Garth states and the baby boomers are toasted during this as A/they have lost half of their net worth easy in RE and other investment portfolios and whatever money is left they wont gamble on. BTW, they wont be able to find jobs if they loose them, the older ones wont find them even if they want to into retirement.

I would appreciate anyone’s opinion on the high return investement vehicles coming down the road. Commodities in metals, agri, bottled water????

Let’s use this time to look for mustard seeds which the world will need and cannot be manipulated by government and those who the press are not promoting!

#12 Steve on 04.17.09 at 12:53 am

Pay off the loan? Well maybe. How exactly are the Fed’s going to repossess your degree?? lol

#13 Terry on 04.17.09 at 12:55 am


Three things …

What are the odds housing is going to take off and rise … What will support that happening?

If you are looking at a properties worth 300k, and they drop another 50k by November, you and your girlfriend will be making an extra 7k/mo by waiting.

What is your risk vs reward situation here?

#14 Small Business on 04.17.09 at 1:01 am

I’m with the stoic bearded guy.

I’m from the same glorious northern city and I can tell you that new construction has slowed to a newborn baby crawl speed.

It is only a matter of time before builders/developers start to offer siginifigantly reduced pricing to entice people to buy.

There is no way that a starter home in Edmonton should be 300,000. Christ, it’s not like we are Vancouver over here.

Do me the favour …. I’d like to buy a house eventually but I won’t spend a dime over 200,000 for a ‘good’ starter house.


#15 Lance on 04.17.09 at 1:12 am

There is no reason why real estate prices in Edmonton will cease falling. Oil prices depressed, massive layoffs, provincial government suddenly in debt… all indicators are pointing downward for real estate in Alberta (and elsewhere). There might be a sucker’s rally or two here and there but the general direction will continue down for quite some time. Save your money and let someone else (your landlord) take the equity hit.

We have been renting the past few months after selling our home and love the look on the faces of friends and family when we say we aren’t looking to buy a house any time soon. We are a successful family, making a solid 6 figure income and have very low risk of layoffs. And yet here we are renting instead of buying. And laughing all the way to the bank… and yet very few people can understand it. The housing bubble has gone on for so long that the steep slope up looks flat to us. It’ll take a long time for history to realize who the real winners are in the landlord/renter arena were post-2008.

Ben, instead of squandering your hard earned savings on a declining asset, continue saving, watch the rental market for continued weakness and if you really want that shiny new place with granite countertops, go rent one for half the cost of owning it. After being a homeowner for the last 15 years, I am absolutely *loving* it being a renter. Our washing machine broke the other day and my landlord has to pay for its repair… excellent! I can spot about $25,000 worth of work that needs to be done in the next 5 years in this house (new fence, roof, etc)… and I don’t have to worry about paying for any of them!

#16 Jay Currie on 04.17.09 at 1:20 am

My landlords had their Victoria house on the market for 903K last year, it didn’t sell. It now wouldn’t sell at 800k and might, with luck, go at 750 (and in my view, that would still be too much). Since we started renting the house six months ago they have lost 100-150k in notional value.

I’ll stick with renting, thank you. Horrible when prices are banging upwards at 2% a month, delightful when they are dropping just as fast.

#17 rick in Surrey on 04.17.09 at 1:58 am

I like to consider myself a tolerant person but how many times are people going to ask the same stupid question about buying RE? I feel like I’m watching the movie “Gound Hog Day” and keep seeing/hearing the same stupidity over and over! “Do I buy RE or continue to rent?” “I have racked up my credit cards and LOC, should I pay them off?” Give me a break people and read for yourself on past blogs and on various other sites. Just stop making us endure your foolishness.
On second thought, go out and buy, rack up debt and when your jobs are gone…you can give your house away to the smart money people that sat on the sidelines in cash watching out for each “greater fool” to top the last one and so on. The smart money will be reaping the rewards for being patient!
You be the cat and I will be the dog on the side of the road telling you that the cars will stop for you as you try to cross the road. Same philosophy from the media, banks and RE Associations telling us that now is the perfect time for first time home buyers to get into the market. It’s called propaganda, spin, lies and BS. The only one’s that are going to win is the dog, banks and RE firms.
Happy house hunting!

#18 The Industrial guy on 04.17.09 at 2:43 am

Garth, the fallout from last Fall’s crash is still playing out in SW Ontario. Major auto parts plants are closing on a weekly basis. If GM and Chrysler slide into bankruptcy and as some bank economist say between 300,000 to 500,000 more people across Canada find themselves unemployed. How long claims can Employment Insurance support before the Government hits us for increased premiums??? I remember how John Chrétien used the UI surplus as a cash cow to fund Government programs. I guess all the surpluses generated over the last ten years were used as general revenue and nothing was banked for a rainy day.
Can CMHC actually absorb all these potential mortgage defaults? There must be a limit.

#19 David Bakody on 04.17.09 at 6:24 am

Buying and owing a home is not what it use to be …. I simply tell people, imagine if y’all had a good job in NYC and were young “WOW” you would pleased to find a nice rented flat and have lots if jingle in your pockets to enjoy life ….. hello there is life here in Canada also. Buying, maintaining and paying for to-days overpriced homes when approached from any other view than buying a home to live in is bad news bears! Less is more to-day (always was) …. and that starts with debt!

#20 Mike B on 04.17.09 at 6:34 am

The state of affairs here in Toronto is a very brisk resale house market. I get few new listings each day and many are SC… sold conditional. The realtors are full of themselves again and barely have any interest in talking to you as that claim to be busy. Honestly people in this town …. maybe just 1st timers… are just nuts overpaying and getting in over their heads. We will wait it out till the nut jobs leave the market in a month.
Perhaps the recent headlines about March sales numbers
being higher has pushed out more loons…prices however were lower but the RE schills don’t mention that.
As for the thought the stock market being a leading indicator… well when it drops out of the sky shortly people may finally realize where the economy really is…
US banks are profitable because they are getting free money and now have relaxed accounting rules.. Not fooling anyone except the moron RE buyers in Toronto.

#21 DG on 04.17.09 at 6:41 am

Having recently moved to Toronto we are finding that everyone we know is practically yelling at us to buy so that we don’t miss the alleged opportunity of a lifetime.

As much as I never thought we would do so, we are looking at moving out to Oakville, the old part with its lovely tree-lined streets. Houses that are on the market for $1.2 – $1.4 million sit close to others for rent for $3,000 – $5,000 / month. The rental properties at the lower end of that range tend to be a little run down, but still full of character and with the same fundamental qualities as those houses for sale, just a little less cosmetic finesse. Let’s say we put $200k down on one of those houses for sale, and the owner was willing to sell for $100k less than asking, our best case scenario is a $900k mortgage, CMHC and probably close to $8k / year in property taxes. Not to mention maintenance of a 100 year-old house.

Even with a 3.3% variable rate we’d be looking at $4,475 / month in mortgage payments with CMHC, $650 / month in taxes and let’s say at least $350 / month in maintenance. Suddenly we’re at $5,475 / month and if home values continue to fall our $200k is shrinking. That $1.1 million house looks like incredible value when you can rent it for $4k / month or perhaps even closer to $3k.

#22 Da HK Kid on 04.17.09 at 6:55 am

For all you inflation bugs, take a hit from MISH on deflation, more importantly bookmark this site and see it daily along with Garth’s.


#23 Charles T. on 04.17.09 at 7:00 am


#24 Chris in England at the moment on 04.17.09 at 7:06 am

I find it interesting that owning a home is such an ambition for some people. If we accept that the days of rapidly growing equity in homes is over (for some years at least) then what is the real attraction in buying something that you can borrow?

Until the big boom of buy-to-let homes occurred in the past few years here, there wasn’t much choice where renting was concerned. Either local authority housing (which most people aspired to escape from) or fairly grotty tenement-type rentals in cities. In other words, if you wanted what you wanted, you really did have to buy it. Fast-forward to now, when there are far more rentals than there have ever been (here at least, and probably everywhere else too, thanks to the property flipping craze) and there is suddenly more to choose from.

As some of you know, I am in the throes of selling my house here (all being well we are exchanging contracts today or Monday) and taking the money and running to Canada. The intention is to rent until we can identify exactly what we need and only buy it when it becomes very affordable in the next couple of years. It seemed the only fly in the ointment was the dogs (multiple) and the inevitable difficulties in trying to rent with pets. There were also not many rentals in the area we wanted to live in, and the ones available were not to our liking.

As I had been studying the mls for years and had noted various properties listed for months on end and still not sold, I decided to target those and see if the owners would consider renting instead of selling. Only when I got a yes to that idea did I tell them the family included a bunch of dogs. I made about 15 approaches and 6 people said “yes” – to renting instead of selling, and to allowing multiple dogs in their homes (this was helped by the fact I was looking in a rural area and a lot of people had dogs anyway). So now we are the proud renters of an impeccably kept house with acres of land just outside a small town.

My point being – this is almost exactly what we would want to buy (almost, but not quite, as we would like some outbuildings too). I doubt that many people contributing here have a bunch of dogs to worry about, so finding the kind of place you would love to live in would surely be even easier than it was for us, and we had to do it from a distance. Consider the possibility of approaching sellers and asking if they will rent – you might be surprised at the answer, particularly as there will be more and more properties coming onto the market and less people willing to buy them.

#25 Kash is King on 04.17.09 at 7:11 am

I liked the analogy of the economic crash mirroring your bike crash. Very clever. At least you didn’t pull a Gary Busey, or did you?

We faced similar peer pressure in the late ’80’s and early nineties to buy a house….” you are paying someone else’s mortgage, housing always goes up, it’s a great way to build equity,” blah blah… from friends and family, nevermind RE agents!
We stuck (really enjoyed the place actually)with renting a house for 8 yrs, rent was half the monthly payment (rates were @12%). We lived off one income and banked the other completely.
Eventually we bought in 1996 which was pretty much a market bottom (we didn’t know that then) When we did buy, things were so negative RE-wise that we forced ourselves into taking the plunge, looking at it as the largest PURCHASE we would ever make, We did not look at it as an investment.
Turns out we never did enjoy what we had purchased as much as we enjoyed the house we had rented…. so go figure.
The one takeaway we have is that you never really OWN a house, more it owns YOU; also see what happens if you don’t pay property tax to the city (feels like rent!)
Besides, we are only above ground for so long, and if you like the place where you live, you are lucky. It does not matter if it is owned or rented. The status of being a “homeowner” is really just that….status.
Status of being a fool in my books now….

Just simply enjoy where you are living.

#26 Munch on 04.17.09 at 8:02 am

Hey Garth?

The answer is —> 42 <—


Enjoy the weekend – have a good rest!

Munch from Johannebsurg

#27 Coho on 04.17.09 at 8:21 am

Garth – “Only now is the extent of the almost-instant collapse of last autumn being known. When stocks tumbled, Wall Street banks folded, credit markets seized and consumers were shocked into paralysis, our world changed in ways we’d not realize until now.”

Interesting how this “almost instant” collapse seemed to come out of the blue. The few that seen it coming were laughed at by the many. That’s because the many were looking at the markets as leading indicators, which they should be, that is, if they’re left to work as they should. However, they are being tampered with which is why what happened last September was such a shock.

Why weren’t the markets indicating what was in store? Because they were being artificially propped up by the ruling elite to obscure how bad things really were long before the crash. By design, most were caught with their pants down. What has happened is that the markets have proved to be a lagging indicator because of the manipulation. They are not being allowed to work as they should, and haven’t been for a long while.

The game is rigged. These markets are not for investing in anymore. They are like a corrupted version of the game show “Wheel of Fortune” where Pat Sajak has his foot on the pedal. Yes, he’ll let you win a little here and there, but on your final spin he’ll bankrupt you.

#28 Sean in E-Town on 04.17.09 at 8:24 am

#10 “Your argument is false. The carrying cost fo a mortgage does not factor in the lost earning power of the downpayment, property taxes, insurances, utilities or maintenance. Together they can double the monthly financing charge. — Garth”

Garth: That’s including the property tax, insurance, and heat and water, and condo fees, (taxes and fees as I mentioned earlier) all normally included with rent. My apologies if I didn’t make that clear, but I’m counting everything that rent includes in said rent. The $12K down payment might earn 10% if I throw caution to the wind in my stock picking, definitely not if I choose an aggressively managed mutual fund, or preferred bank shares which would earn $65/month instead, meaning I could carry for an effective cost of $755. That’s rent, plus five bucks, if I could shelter all of the investment, which I can’t, so I’ll pay 25% on about half of that, or maybe 8 bucks a month.

As you can see, we’re in very very close territory here. The illiquid nature of these assets is a little upsetting, but worrying about the liquidity of centrally located housing seems to me to be tantamount to buying credit default insurance on the US treasury (If it turns out right, you won’t be in a position to collect). If the employment picture in Edmonton is so bleak that I can’t get a 22K/year job, it doesn’t matter if I have stock in energy companies as they’ll have swallowed so much obsolete capital, like an internet company laying dead fibre-optic, as to crush the value of my stock. Thoughts?

#29 Herb on 04.17.09 at 8:28 am

And to help us recover from the Harleynomic crash, we have our federal politicians and “this all-party conspiracy of stupidity” that “precludes serious debate about anything”, as well as “a Parliamentary cone of silence“.

– Susan Riley, at http://www.ottawacitizen.com/business/fp/Going+stupid/1504585/story.html (emphasis added.)

Garth! Come back!

#30 ally ally oxycontin free on 04.17.09 at 8:34 am

#23 Charles T. on 04.17.09 at 7:00 am

That’s a good URL, Earl … in fact, a pearl of an URL !

Just don’t forget Mark Carney ‘cut his teeth’ as a member of that tribe. It’s said [ by some ] he is a true and real son of Art Carney, of MoneyHoovers fame.

Notwithstanding [ gotta love that word ] he’s an apologist for all the Harper government confusion and frequently given to acting as purveyor of the Harper HorseCrap ‘positive’ message. Some years hence his keyboard error will be discovered … He offered the ‘positive’ that Canada could avoid the recess … er depression, with a ‘come-out’ by mid 2009. The keyboard error … Most of us are now sure he meant 2019.

#31 PTDBD on 04.17.09 at 8:53 am

Canadian taxpayers hire TWO American spokesmen to animate PM Harper

Michael McCurry and Ari Fleischer, former Bush press frontman will garner American media exposure for PM Harper ;-) going forward ;-) on the world stage. Hopefully, they will ensure that he gets to his photo sessions on time and that the strings remain hidden.

Oh my, the generosity of taxpayers knows no bounds.

#32 Anonymous on 04.17.09 at 9:06 am

When stupid people make too much money, stupid things happen to all of us. This is the biggest problem with Edmonton. Oh, and the baseball-cap, sunglasses wearing morons driving 3/4 ton diesel trucks with really un-funny hobbes pissing on a GM logo and a pair of balls hanging off the hitch.

You have 60% of Edmontonians not making ANY changes to their lifestyle. No cutbacks, no reduction in spending, nothing. Living it up like 2007. That rubber band keeps stretching, and stretching… until… they have to make changes… often way too late to matter.

An average bungalow in Edmonton will be $160,000. Rent will be halved.

Alberta is doomed.

#33 Another Albertan on 04.17.09 at 9:12 am

An interesting anecdote from Edmonton:

I spoke with an accounting buddy last week and asked him for a general summary of what he’s seeing with his clients – generally closely-held, private companies with revenues under $10M.

He indicated that 2009 will be a decidedly different year. In the 2004-2008 window, some companies made “outrageous profits”. “How outrageous?” “Incredibly outrageous, when compared to their historical averages. Over the top.”

Where did these profits go? “Well, some went into the pockets of the employees, but the vast majority stayed with the owners.”

Ok, now what did the owners do with the profits? “Oh, you know the answer to that one. It’s obvious. It poured into the real estate market – residential and commercial. And I mean it POURED in. Some of these owners were pouring hundreds of thousands into speculative commercial construction projects and they firmly believed that these projects would dwarf the net incomes from their primary businesses. As it is turning out, many of these guys have blown significant amounts of their gains in the past 5 years. While they are far from hurting financially, their tied-up and disintegrating investments are huge. Many will feel residual pain in the future from these one-sided decisions.”

#34 vtj on 04.17.09 at 9:16 am

Is it just me or is this forum becoming just a tad repetitive?

As I type this, I’m reminded to get a life and move on to more interesting things than waiting for all hell to break loose.


#35 dd on 04.17.09 at 9:17 am

#28 Sean in E-Town,

So buy if you math works. Don’t wait for approval.

#36 Bill-Muskoka (NAM) on 04.17.09 at 9:17 am


You may be right…’Buy a bike’ as the Hell’s Angels nests are now available for new tenants. Talk about a RE opportunity?

On the more serious side your comments about the consequences AFTER the crash might just make a few people think about their driving and be more aware. The air bag may save you, but it won’t stop the real suffering afterwards.

With the latest report of 23,700+ drivers who have been caught doing more than 50 km/h over the speed limit it seems to me the message still needs to be gotten out.

#37 dd on 04.17.09 at 9:21 am

#16 Jay Currie

“I’ll stick with renting, thank you.”

The Victoria rental market is still tight … hasn’t moved much over the last little while. It will be interesting to see if this market will help lift the vacancy rate.

#38 Toronto C9 Renter on 04.17.09 at 9:25 am

#21 DG said:

“…we are looking at moving out to Oakville… Houses that are on the market for $1.2 – $1.4 million sit close to others for rent for $3,000 – $5,000 / month”

DG I’ll offer up my recent experience in renting. We sold in spring 2008 in central Toronto and now rent a slightly smaller, slightly more spiffy house in the same area.

While the rental fee (at the top of your stated range, above) was a bit hard to swallow at first, I’m now 100% confident that financialy, renting is the way to go.


– $10,000 property tax – gone!
– Roughly $5,000 /yr maintenance – gone! (actually some years it was much higher – eg. just getting the giant oak tree pruned one year cost $4000 alone)
– Mortgage payments (and all debt for that matter) – gone!
– lost equity due to dropping home prices – Gone!
– Roughly $3000 to $6000 monthly opportunity cost of having all that money tied up in real estate – gone!

And finally, the peace of mind gained not having to worry about the real estate market and mortgage rates. Hard to put a value on it, but for me the value would be very high


#39 Stuff on 04.17.09 at 9:26 am


They have obviously not read your blog. The buyers market that wasn’t even a buyers market might be over.. Seller market again soon. As per this idiot. If he’s right I’m moving to the U.S. to buy a cheap home.

#40 Canned Goods and Buckshot on 04.17.09 at 9:32 am

Shawn #3 asks

“Our collective capacity to produce has not diminshed so why must our collective consumption?”

I like your notion of considering our situation if you imagine our planet with an envelope around it.

Due to technology and cheap oil we have become really good at producing things. But production and consumption have consequences. We create waste with almost every produced thing. Since the globe is a more or less closed system (excluding different types of radiation), it does not have an inexaustable ability to absorb or deal with our waste products, for example green house gases and trash.

Our collective consumption has raised our standard of living and it responsibe for great leaps in many fields, but it is also detrimental to us on many levels.

Dick Cheney memorably said the American way of life is not negotiable. Many would agree that a large part of the American way of life (and Canadian and Australian, etc.) is based on over-consumption. To paraphrase author James Kunstler (often refered to on this website): Nature and oil economics won’t stop to negotiate. I think for some of us, we will look back at our consumption and see it as a slow motion bike crash. For others it will be like a clothesline blow at the blue line.

#41 ally ally oxycontin free on 04.17.09 at 9:40 am

HEAR YE … HEAR YE … HEAR YE ! I’m <b?oney here ‘cos Bob and Doug are busy over t’House of Elsinore Brewery. Do you realize, you just might wake up Canadian ? [ Eh ? ]

WSJ—APRIL 17, 2009 Canada Issues a Wake-Up Call:

You May Be a Citizen, [ EH ? ]


•“Including those that allow people to be citizens of only one nation—won’t be alerted, according to the immigration office spokeswoman. Those people also may renounce their citizenship rights, she said.”

Notice how, the minister from the affected / originating ministry is never available for comment. It’s a pharce … a real pharce, writ under the pseudonym of PHRED DVORAK, who is, personally, no phriend of mine.


#42 Just a Carpenter on 04.17.09 at 9:45 am

#15’s attitude is the reason I sold my residential revenue property. The one thing that all you Rah Rah renters need to consider is that you may wind up with a reluctant landlord who can’t affford to maintain the property. What then?

I was a landlord, sold my properties as I got tired of being a slave to people with your attitude. The only guys I know that are purposed landlords are the slumlords, many of the rest being reluctant (those who are stuck with RE) and are not always in the position to jump in a do imediate repairs. Complain all you want but you may be without a fridge, furnace etc. at some time.

There are far better investments and while many of you may find good rental accomadation, in this town they are far and few between. I own because I enjoy my quality of life, sure it is more expensive than renting, but it is what I choose to spend my money on.

The other advantage is the equity in my home (albeit diminishing) is a cheap way to finance my business. Regular commercial lending is always 1.5 to 3 points above prime, my equity can be accessed for prime or less.

While I agree that now is not a good time for anyone to enter the market, not all of us homowners are heading for the door!

#43 Got A Watch on 04.17.09 at 10:13 am

OT – But I have to say it – the utter uselessness of the Harperite morons is on full display today.

We have Canadian citizens being held hostage in foreign countries, threatened with arrest and jail, because their holiday company (Conquest Holidays) stopped paying it’s bills a month ago.

Meanwhile, on the distant planet inhabited by Stephen Harper, he is jetting off to a conference with nary a care in the world.

Where is our Minister, or Ministers, in charge of these kinds of things? In hiding, of course, in case anybody expected them to do anything substantial to help.

If you are Canadian, and you go abroad, rest assured that your Government is so useless and incompetent that they will not be able to do anything to help you whatsoever. You’re on your own.

Just remember this debacle next election, and remember to vote for anyone but Harper and the CONservatives.

#44 SSS on 04.17.09 at 10:17 am

#27 Coho,
Thanks.. Your words make more sense. Can you please comment a bit on, what we can do to be immune to these manipulations?

#45 ally ally oxycontin free on 04.17.09 at 10:17 am

WSJ—APRIL 17, 2009

Australian Firms to Pay Scarce Cash for Pensions

“SYDNEY—Qantas Airways Ltd., which subsidized its employee pension plan earlier this month, is the latest Australian corporation that must tip in extra cash to compensate for declines*** in global equities markets that have eaten an estimated 25 billion Australian-dollar (US$18 billion) hole in retirement funds.”

***I guess their declines were only Koala-bear sized declines.


Having said that, we notice Antonio Clemente [ alias, Richard Head … y’all can call him DICK if you want, is having some rather ungrateful responses to his money-tree pork-barrel offerings.

Lake of Bays turns down $4.5 million in G8 funding


In the meantime, DICK is telling Chrysler and the CAW ‘they’ve got to get their labour costs into line’ … under the government’s last call.

Yet DICK never mentions the Ontario taxpayer fleecing which took place during the Harris / Eves era, whereby DICK participated in the grab of $55 Million from general revenues to match the $54 Million [ existing within the MPP pension fund ] or the additional $10-Million tax penalty
[ Ontario taxpayers had to pay ] because DICK et al didn’t clear the transaction with Revenue Canada. Some MPP’s were made extremely wealthy instantaneously !

Mebbe we should all send an E-mail to DICK in praise of his salutory approach to principle and ethics.

Did you catch DICK’s wave on the way by?

#46 Dan in Victoria on 04.17.09 at 10:21 am

Post#17 Rick in Surrey,yeah I feel like you do some days also,But remember these are young people just starting out and they haven’t learned yet.Kind of like training a young apprentice they eventually get it.Anyhow Ben go to this site, on the left hand side of the page start reading,its three pages with some blue letter highlights click on them it will give you more info.It will explain in detail about renting and costs of owning…..hmmm just like we’re saying. Good Luck. http://patrick.net/housing/crash.html

#47 Bill-Muskoka (NAM) on 04.17.09 at 10:30 am

Don’t we all just love the undefined terms of ‘The Fun-Duh-Mentals are strong’?

What EXACTLY do these babbling fools call ‘fundamentals’?

1. They are still having ‘Fun’?

2. They are clueless and thus going ‘Duh’?

3. They are merely ‘mentals’ and incapable of dealing with reality?

Enquiring minds want to know!

Abraham Maslow defined real fundamentals and to violate them always results in discord and angst for society.

#48 Investor on 04.17.09 at 10:32 am

This is what most overheated real estate markets could expect in Canada

This is from today.

A report yesterday showed that San Francisco Bay Area home prices fell a record 46 percent in March from a year earlier, the 16th month of declines.

#49 Bobby on 04.17.09 at 10:33 am

When realtors, mortgage brokers and other real estate hangers on are telling you it is time to buy, it is a good time to sit and wait. They quote that sales are up but that is in respect to a dismal February. They are really down from last year and listings are at an all time high.
The last person I would ask for real estate advice is a realtor. Remember they don’t get paid unless you buy. Keeping that in mind, tell me do you think they would say, let’s wait.

#50 newfangled on 04.17.09 at 10:35 am

Sean in E-town:

In the entire Edmonton metro region there are less than 20 listings for under $100k that are not in trailerparks. You are talking about the bottom 0.5% of the real estate market. For $750/mo rent you can find a better comparable.

#51 Calgary37 on 04.17.09 at 10:46 am

Who is the ‘Greater Fool’ Now?

By Lorimer Wilson
Apr 16, 2009

This article ties in well with Garth’s book.


While you are at it, also check out this article.


NOTE: Here is a pertinent excerpt from Wikipedia:

The bancor was a World Currency Unit that was proposed by John Maynard Keynes, as leader of the British delegation and chairman of the World Bank commission, in the negotiations that established the Bretton Woods system, but was never implemented.[1]

It was to be initially fixed in terms of 30 commodities, of which one would be gold. It would stabilize the average prices of commodities, and with them the international medium of exchange and a store of value. Central to Keynes’ proposal was to tax countries’ current account surpluses, encouraging domestic demand and promoting global trade balance.[2]

The Americans made a comparable plan for reform that included a world currency called the unitas. At Bretton Woods in 1944 U.S. President Franklin D. Roosevelt told U.S. Treasury Secretary Henry Morgenthau, Jr. to prepare for an international currency to be implemented after World War II. Harry Dexter White at the U.S. Treasury formulated plans for the unitas.

In practice, until the collapse of the Bretton Woods system in 1971, gold itself filled this role, with the U.S. dollar fixed to gold and many other currencies fixed to either the U.S. dollar or directly to gold.

There have been variations on the model of the bancor recently, such to have bancors for regional trade organizations such as the North American Free Trade Agreement (NAFTA), ASEAN (Association of Southeast Asian Nations), etc. In this model the commodities that would be placed into the pool would be limited to a fixed number of the currencies of the partner nations, and this would be done on an annual basis with agreement on prerequisites for withdrawal.

A lot of articles have been written about Keyne’s theories over the past few months, but it was only recently that I came across a mention of the “bancor”. After doing some research, I found some recent articles but they were mainly by no name bloggers.

A Global Currency (Cashless Society) is part of the NWO/One World Government Agenda and would be an important part of their future control mechanism over the remaining population. However, if Russia, China and the other oil producers were to use my version of a Digital Global Currency, then they would be able to bypass this control mechanism.

I am expecting some type of global currency by the end of 2009 or 2010. If the IMF is reformed and their SDR basket of currencies is changed to Regional Currencies, then the American Dollar could be replaced by the Amero.


Power to the People. Let the Revolution Begin.

#52 hagbard on 04.17.09 at 11:14 am

To those who keep saying there are tons of nice rental houses available, try finding one in Essex county Ontario. No great rental deals here. Don’t keep talking as if the major centres determine the entire country. Here, it does appear better to buy than rent.

#53 infernalmachine on 04.17.09 at 11:49 am

Garth –

I am a young urban professional (civil service woo!) in Toronto and I rent –all around me my immigrant relatives, my well off, well-educated peers are asking “so when are you going to buy?”

I tell them “In 5 years when RE crashes because nobody can afford this CRAP!”

But then I see stuff like this in the Globe RE pullout:


From Friday’s Globe and Mail

April 17, 2009 at 12:00 AM EDT

ASKING PRICE: $399,900
$363,000 (2006)
$320,000 (2006)
$230,500 (2002)
TAXES: $2,459 (2008)
LOT SIZE: 18 by 100 feet
LISTING AGENTS: Lindsay and Melanie Wright, Re/Max Hallmark Realty Ltd.
Within a span of four days, multiple offers were submitted for this semi-detached residence in the north section of Riverdale.

So this property almost doubled in value over less than 7 years? My wages haven’t doubled in that time frame… Whose have? Look at the place – it’s a small little dumpy house in a simply-okay area. But PEOPLE KEEP BUYING!

Will prices really come down — or will we end up like New York City where 500 sq feet costs you $500K?

#54 Flip on 04.17.09 at 11:53 am

Since you can now readily find a 1250 sq/ft bungalow in fancy Glenora in edmonton for $1600 (furnished)
http://edmonton.rentfaster.ca/Edmonton-Apartments-For-Rent/7475-Glenora-House you’d be nuts even considering purchasing some sort of either “fixer upper” for $300K or mini-mac Mansion/Townhouse for $275K

Get out of debt
Max out your RRSP’s
Make yourself indispensable at work

#55 R on 04.17.09 at 12:18 pm

I dont understand why people are so terrified of renting. I also don’t understand how people can run around claiming to own their houses. Most have 25 year mortgages so until its paid in full you are renting and the landlord is the bank. Think about what your bank rental will be worth in 5, 10 ,15, and 25 years from now. Scary thought ! The world has changed ! Change with it!

#56 pjwlk on 04.17.09 at 12:20 pm

#15 Lance: I with you here. After owning for 17 years I am also having the time of my life needling the naysayers who showed me no mercy after I sold and started renting. I kind of feel guilty about it…no wait…no I don’t…lol

#57 Svejk the Banker on 04.17.09 at 12:33 pm

For those of us that are younger, I think giving up job mobility (going elsewhere for work by being encumbered by a house with relative illiquidty) without either being firmly part of the corporation or witt family responsibilites. The Biggest Asset of a Young Person is their earning potential. We need to stop thinking like middle aged and old people in terms of home buying etc. without really thinking of what we are giving up.

#58 Kash is King on 04.17.09 at 12:39 pm

#27 Coho, good post. Further to allegations of manipulation:

“Gold Is Manipulated…And You Should Buy it Anyway”
by Jon Herring


I’ve begun to look at gold and silver more as old wild west cowboy money.
Maybe there is some comfort in a retro “real” money kind of way, you know, a big rootin’ tootin’ jingly bag of loot.

#59 Got A Watch on 04.17.09 at 12:50 pm

Important story: IMF Warns Downturn Will Be Prolonged and Recovery Shallow

“Readers may know we have oft pointed to the work of Carmen Reinhart and Kenneth Rogoff on financial crises. They have built a large database of past crises, and have compared the US to past crises countries. Their conclusion was that the US looked like a typical crisis country “only more so”, and in two presentations, compared our progress to date to the trajectory of past postwar crisis countries. Their conclusion is that financial crises are protracted affairs. For instance, it typically takes the stock market 3 1/2 years and the housing market over 5 to bottom.

The IMF, in its latest World Economic Outlook, confirmed the Reinhart/Rogoff take, based on its own analysis of business cycles in 21 countries from 1960 onward.

Globally synchronized recessions are longer and deeper than others. Excluding the present, there have been three episodes since 1960 during which 10 or more of the 21 advanced economies in the sample were in recession at the same time: 1975, 1980 and 1992. The duration of a synchronous recession is, on average, nearly 1½ time as long as the duration of the typical recession. Recoveries are usually sluggish, owing to weak external demand…

The analysis suggests that the combination of financial crisis and a globally synchronized downturn is likely to result in an unusually severe and long lasting recession.”

We should be at the longer end of the scale on this one, since it was the largest credit bubble ever bursting. So it seems an easy conclusion that this time out, we will see a bottom in stocks after 4+ years, real estate 5-6+ years, from peak, and that would be near the optimistic end of projections.

In the updated Four Bad Bears Chart chart, a must see, they have the length of the first part of the Great Depression’s stock market Bear at 34.2 months, -89.2% from peak. But there were further peaks and valleys, stock markets did not regain 1929 levels until 1954, 25 years on from the beginning.

So, “Bottom Is In Now!”…not so much.

#60 "Joe Six Pack" North Vancouver Citizen Jr. on 04.17.09 at 1:13 pm


As a Financial/Real Estate expert/critic you now have a significant opportunity to catapult yourself into a “Political/Leadership” limelight.

What is your position on the CAW/GM/Chrysler situation?

Is the auto industry a Federal question or a Provincial one?


#61 jwk (nee jwkimba) on 04.17.09 at 1:37 pm

#52 You are likely right.

read section 2) in this link:


Essex is close enough to Michigan to get the idea.

#62 jess on 04.17.09 at 1:45 pm

President’s Speech
Presentation to the 18th Annual Hyman P. Minsky Conference on the State of the U.S. and World Economies—“Meeting the Challenges of the Financial Crisis”
Organized by the Levy Economics Institute of Bard College
New York City
By Janet L. Yellen, President and CEO, Federal Reserve Bank of San Francisco
For delivery on April 16, 2009, 8:00 PM Eastern Time, 5:00 PM Pacific

A Minsky Meltdown: Lessons for Central Bankers

#63 Kash is King on 04.17.09 at 2:06 pm

Hey Garth, is this the big thing that led you into generators, a bunker, cash at home, survival kit? etc..

It’s about EMPs or Electomagnetic Pulses.
Seems to me ALL electronics could get knocked out?


#64 Ken on 04.17.09 at 2:16 pm

Changes in our lifestyles both mentaly and in a material scence will have to change drastically,re our new position in the world.The big players will be china, india and other developing countries. No more greed and corruption in the west,oh yeah!!!

#65 jess on 04.17.09 at 2:28 pm

this video explains the options without jargon

2)conservatorship or receivership

#66 Dead Cat Bounce on 04.17.09 at 2:38 pm

#52 hagbard

What are you talking about there is a 10% vacancy rate in Windsor, lots of great rentals. Saying that Windsor never had the boom so buying now there is better than the rest of Canada. Lets be honest though Windsor is half America half Canadian.

#67 @Garth 2 on 04.17.09 at 2:56 pm

To everyone that loves to cite the “stats” on San Francisco real estate, please try to find me a real 3-bedroom San Francisco property for about 350-400K $CAD. Any takers?

San Francisco properties are no bargain even after a 70% price decline. It’s a different market completely.

#68 wjp on 04.17.09 at 3:15 pm

CPI up 1.2%….food prices up 8%
Pension Indexing will be based on 1.2%…
What do seniors eat?
Do you think the system is flawed?

#69 Too Old Bob$ on 04.17.09 at 3:40 pm

“#46 Dan in Victoria. But remember these are young people just starting out and they haven’t learned yet. Kind of like training a young apprentice they eventually get it.

So where are their savvy parents. Maybe they could give them a lesson on RE 101. Oh wait! they’re doing the same thing, but just working 200 hours a week to support it. Ok then, where are the parents of the parents. I’m guessing they are driving around in their $300000.00 Motorhomes (complaining about gas and insurance prices), flying back and forth from their retreats for golfing and thonger beach jogs (complaining about air fares and charges) or maybe they are showing off all their antique cars that they purchased from money made on real estate and stock markets (complaining about the dam birds that crap on them). Then again they may be sitting in a retirement home playing cards and watching everything unfold.

What the….I better book a room before it’s too late!

#70 Abraham on 04.17.09 at 3:50 pm

Hi Garth,

I live in Calgary and recently I see rental advertisements with discount and promotions everywhere…its like many people are leaving the city…

but the things is the housing market is still resisting in Calgary and I don’t know who are the buyers…

Can you comment?


#71 The Other David on 04.17.09 at 4:53 pm

the crazy lady ann rohmer hosting hot properties on pulse24, says the canadian market has hit rock bottom, and is on the way up. get in before you are priced out.

two other RE pimps on the show echoed the same.

#72 Dee on 04.17.09 at 5:21 pm

Abitibi is unprofitable and so will have to shut down all their operations in Canada. The U.S. mills are more profitable.

Guess it helps to have 6.6B subsidy to maintain that profitability.


And we’re cutting how much Canadian timber to ship raw logs to the U.S.? And our government is doing what? Oh yeah, 40K/month to keep 2 American publicists on retainer as well as grabbing their ankles and groaning their admiration for the Jewel called ‘NAFTA’.

#73 john m on 04.17.09 at 6:25 pm

good post Garth…i come to your site every day for some reality and honesty.But cmon now “harley nomics?? :-) personally i like performance machines………..really now why ride a “52 buick” with no mufffler when you can buy a “screamin porche” for half the price :-) :-) ha,ha

#74 JO on 04.17.09 at 6:26 pm

While anything is possible, we are very likely in the midst of a powerful bear rally..we should beging a short term decline next week, but as long as the market holds 770’s on SP500, we have a chance to keep this thing going even into Sept..although this is unlikely as optimism is too high..bottom line, i expect at least one final, horrific waterfall decline lasting several months and likely taking place between Oct – Feb 2010.

The real economy will show a temporary stabilization, maybe even modest (small) rise between Q4 2009-Q1 2010, before entering a more dramatic collapse from spring – end of 2010. Make no mistake, it will be far worse than what we have had.

As for bottom picking, I am hoping to buy long term investments in the following areas: domestic energy companies (careful with energy companies that have large operations/based in other countries – radical politics will define us 2010-2015), large investment in Japan asia (india/taiwan/singapore), gold, and some blue chip health.

#75 . . . fried eggs and spam . . . on 04.17.09 at 6:43 pm

A number of first-class posts, particularly on the benefits of renting (depending on age and circumstances) vs. owning.

Re: Mish’s excellent link about current (and continuing) deflation, there are plenty of viewpoints to look at, not the least of which is http://tinyurl.com/crhd9m

A pic on a site I saw in Jan. or Feb. showed what a mall in Illinois looked like the week prior to Xmas 2008 — almost empty, hardly any shoppers anywhere. This is where Garth and I take differing sides, but that’s fine.

Worldwide, I take the view that barely a third of the downturn is over, and will accelerate after these dumbass Olympics in 2010.
Is the economy booming again? Well, there are a multitude of worldwide economies, so it depends on which economy anyone talks about! — http://tinyurl.com/c8p3ja

Water and China are having a hard time mixing! Also, check on the last story about inflation.– http://www.dailyreckoning.com/
From Money & Markets.com:

“. . . if the U.S. economy shrinks 2% in 2009? . . . in the first quarter, the U.S. economy contracted two and one-half times more than that — at an annual rate of 5%!

“. . . Will this bank fail if unemployment rises to 8.4% in 2009? . . . unemployment is already higher than that, at 8.5% and more than 600,000 more jobs are being lost each and every week!

“. . . Not only is the economy already shrinking much faster than 3.3% … the Obama administration itself has warned that unemployment will be much higher than 8.9% this year! . . . The still-accelerating surge in home mortgage defaults hammers banks in the weeks ahead …

“The new explosion in the number of defaults on jumbo loans made to prime borrowers hits the headlines as lay-offs continue to intensify, and when . . . Large chunks of the entire commercial real estate sector go the way of GGP — the nation’s second largest shopping mall operator that declared bankruptcy yesterday.

“. . . cities are unable to provide police, fire and other essential emergency services when the credit markets shut down, supermarket shelves are emptied because trucking companies can’t get short-term loans to stay in business, soaring deficits drive interest rates sky-high and gut the dollar, driving our cost of living through the roof. . . .”

Etc., etc. As goes America, so goes most of the supposed ‘civilized’ western society.

#76 Bottoms_Up on 04.17.09 at 6:51 pm


The Canadian government is finally catching on!

#77 Sun Yat-sen suit on 04.17.09 at 7:10 pm


Anybody care to speculate – hinted initials welcome.

#78 Tony on 04.17.09 at 7:27 pm

#44 SSS manipulation is your friend. The stock markets are at least one hundred times more predictable than they were during the 1940’s to the mid 1990’s. The hedge funds and the U.S. government move the market. One caveat it’s always to the upside. You just have to play the stocks that are “in play” and just short them all when the dow hits 9,000 this fall. When the news is so bad even the average layman on the street knows the stock market levels are a joke as price per earning multiples reach 20 times, borrow sell the farm or whatever to go short all the major indexes.

#79 taxpayer like you on 04.17.09 at 7:41 pm

Re: Mark from yesterday


I found it a fascinating read, but more for its theory of
housing bubbles as opposed to the particular cities.

You can check earlier years too. As I recall, US/UK bubbles were earlier, now its Canada/Aus/NZ. You can also see how many affordable places in Canada – and the US – there are.

Unfortuneately it only covers english-speaking world. It would be interesting to compare to western europe and

#80 Chris on 04.17.09 at 7:42 pm

How embarrassing, houses are starting to sell above listing price in Victoria ( in $450 000- 500 000 bracket). Greater fools indeed!

#81 Gord In Vancouver on 04.17.09 at 7:57 pm

The REAL British Columbia?


I hope not.

#82 "Joe Six Pack" North Vancouver Citizen Jr. on 04.17.09 at 7:58 pm

…My single long posting…

“”Quebec gives Abitibi $100-million ‘shot in the arm’ “”

…Ontario should take care of it’s own too…GM/Chrysler


…It’s time to break up this too ridiculously diverse country…

tell me, who needs this crap from Quebec?…

“”Drug costs have ballooned in Quebec..Highest in Canada””


and before you call me a racist, read this….


#83 Just someone on 04.17.09 at 8:30 pm


Why do you tell everyone to rent but you just bought property yourself?

I’m not normal. I crash bikes. I get kicked out of political parties. You really want to be like me? — Garth

#84 "Joe Six Pack" North Vancouver Citizen Jr. on 04.17.09 at 8:54 pm

Garth, you know what you deleted was germane.

You are still playing political correctness.

Trudeau didn’t figure on a world wide depression…did he.

Peace unto you brother.

… you will need it in Ontario…next door to Quebec, Michigan, Ohio and New York…

#85 Jon B on 04.17.09 at 9:43 pm

You should have also used the Harley metaphor to illustrate that just like getting on that motorcycle, investing in the stock market is also risky behavior that will surely at some point in time lead to pain and suffering. Whether its the other bad SUV drivers on the road or the criminal acts of CEO’s controlling your investment cash, it comes with significant risk.

Unlike buying a house which requires electricity and gas and insurance and can lose 40% of its value. Sure, makes sense. — Garth

#86 dd on 04.17.09 at 10:28 pm

#82 “Joe Six Pack” North Vancouver Citizen Jr.

Your run for the Minster of Finance post isn’t looking so good.

#87 canuck99 on 04.17.09 at 10:33 pm

Globe and Mail: Hot potatoes: the humble tuber leads food prices higher

“Potatoes are 55 per cent more expensive now than a year ago, Statistics Canada says, and grocery prices overall rose more in March than at any time in the past 28 years.”

“Overall, groceries were 9.5 per cent more expensive in March than a year ago, the biggest increase since September 1981”

Comments, Garth?

source: http://business.theglobeandmail.com/servlet/story/RTGAM.20090417.wfoodprices0417/BNStory/Business/home

#88 Dan in Victoria on 04.17.09 at 10:42 pm

Post#69 Too Old Bob, I don’t know where their parents are,I had enough trouble raising my own parents.They seemed to have turned out okay for now.As to the young kids turning up on construction sites most of them have to be taught how to curse properly first,this “my bad”saying doesn’t cut it with us oldtimers.There has to be some passion.Just because some of them haven’t inherited any common sense from their parents doesn’t mean they can’t be taught,thats why I always try to pass on what I have learned and read,what they do with it is up to them.

#89 Charles T. on 04.17.09 at 11:09 pm

MONTREAL — A U.S. softwood lumber coalition says it will fight the Quebec government’s plan to provide up to US$100 million in loan guarantees to AbitibiBowater (TSX:ABH), which employs 7,500 in the province.

U.S. lumber group to fight aid to AbitibiBowater

#90 nonplused on 04.18.09 at 12:22 am

Crashing bikes sucks. I only ever did it off road (knock on wood), but even the trees and/or landing on your bike sideways from a significant altitude can spoil your day. But it isn’t anything the doctor can’t stitch up and your local dealer supply parts to fix.

In economics as in riding motorcycles, safety first folks! Don’t take chances you don’t understand. There isn’t anything between you and the road and no you don’t know what you are doing.

#91 marcus aurelius on 04.18.09 at 12:25 am

Infernalmachine (#53) – and you too, MikeB (#21) and DG (#22): Like you, I am unapologetically Toronto-centric when adding my thoughts to the GF blogsite. So here goes:

1. That page you see in the Globe or Post re ‘deals done’ is not exactly subject to journalistic vetting. Check the DOM stat for any of these misleading squibs (MLS-watchers can catch that immediately) and you’ll see that the churned listing issue is ignored. These pages are a collection of the handful of questionably -engineered, dumb-ass deals – the only criteria seems to be ‘Did my sucker purchaser overpay market?’ If so, the agent, squirming in their pants, rush to their newspaper enablers who are (as Garth noted in one of his best columns here, earlier this month) glad to participate in the Money for Propaganda prostitution ring that passes for the expiring newspaper business. Just treat those Globe and Post pages as Humour – like the Darwin Awards.

2. Think about that assumption re debt load and risk, in the example of a $900K mortgage on a property that the buyer reduced less than 10% from the silly-ass asking prices we are still seeing in (stale and unattractive) Listings in Toronto. What happens when that 3.3% variable rate starts rising even 2 years out, and doesn’t stop rising until 11%? How does that 81% financing deal look then? I think more inventory than you know at the $1M-$1.5M (Toronto working stiff, not rich) price level was sold in central TO over the 2005-2008 period. Assuming these idiots went to Cancun and didn’t give up paying $300 for a crappy Harry Rosen shirt or pair of jeans, that’s a big nut at 11%, come gut-check time. Regardless of all the unitentionally funny ‘macro-economic analysis’ on this blog., that simple assumption that idiots are breaking the golden ‘75% rule’ on financing maxima is enough to tell us all that we are inexorably moving closer to the end game for these Toronto cons.

Wait, Grasshoppers: you’ll be able to drive down any Central TO street yelling ‘Bring Out Your Dead’. The plague is coming, no matter how many ‘rosy roundtable’ marketing congames the Bank minions and the agent pimps stuff down so-called journalist gullets this Summer and Fall.

#92 nonplused on 04.18.09 at 12:27 am

Oh and Ben, go ahead and buy that house. Renting sucks! For example just this week my fridge died and my landlord brought me a brand new one for free! Nice one too, or at least nicer than the old one.

Nobody owns houses anymore. The average family moves every 5 years. Owning makes no sense unless you are planted.

Why on earth would a young couple buy a condo? Unless they are never going to have kids or are certain the condo will appreciate, it doesn’t make sense. Now, you have little ones on the way and you can’t sell the dang 1 bedroom for enough to cover the mortgage. At least renters are never underwater, they just need a bigger place.

#93 Grumpydawgs on 04.18.09 at 12:33 am

WJP #68, ” What do seniors eat”? Indeed. The inflation rate of food products is FAR higher than 8%. The suggestion that 8% is a fair assesment is as insane as 1.25% hedonics measurements of the phonied up CPI.

The fact is that milk is up 39% in the past 12 months, a loaf of bread at the supermarket is up over 100%, meats are up 40++%, vegetables are all up more than 20%, Fruits -ditto etc etc etc. Inflation for the things we consume is RAGING IN CANADA.

The Fed doesn’t count any of theses consumer items in the CPI calculation because they are too ” volitile”. Instead the CPI is a ‘hedonic’ measurement made up of adjusted figures including the gauge of cotton used in T-Shirts, the proposed additional gas mileage which is advertised for a vehicle, the increase in computer RAM of the upgraded systems, plastic keyboards, imported widgets etc etc. That is what the government uses to calculate CPI, not food, energy, taxes, fee creep, accomadation, intrest rates etc etc. In other words everything you pay for on a day to day basis.

Why do they do this? Think of the massive amounts they would have to take away from wasteful programs and pork spending if they had to add the REAL INFLATION cost of living in Canada to every senior CPP, GIS, OAP, DPP, indexed government pension plans etc etc. They are cheating you because they can !!!!!

I saw a woman selling cat food on the Home shopping Channel ( it was being manufactured by Elllen Degeneris, the comic) . The saleswoman actually spooned it into her mouth ( hers not ellens) . I got the distinct impression that this was a subtle reminder to the seniors that cat food is yummy and fit for human consumption. The old joke about seniors eating cat food may be more of a reality than we care to think.

#94 Da HK Kid on 04.18.09 at 12:33 am

Garth bought a bunker and filled it with canned goods and generators and a spare road king for parts.

#78 Tony has a good point. Knowing you are being manipulated and accepting it is the best way to invest.

If you want some advise, sit powder dry on the sidelines and spectate this latest bear market rally for the spring to say June and watch the pattern form, it could go 9000 but likely hover around 8500 max then back to retest lows.

The second wave wont be as profitable but there just the same and 3-4-5-6th waves likely to ‘bear’ less fruit but still a great chance to make money but only if you are shorting index’s. You have to be 24/7 with this kids or you could loose your shirt on any panic sell off.

If you want to long products do it with physical items such as commodities OR here’s the real bonus, what the consolidation forming the next 6-8 months on solid cash rich, strong balance sheets blue chips and get in for long 5-7-9 years tours.

I still have a feeling the traditional stocks will have more rallies due to the pure manipulation factor but they will loose their flavor in due time.

Buying right now is likely the most ignoring idea you could have especially if you are a Gen Xer who feels you’ve been cheated by the WORLD of Boomers.

This is your best time to strike and hard given you are renting property and have your saved downpayment or any proceeds from your property just sold (and non ownership monthly savings) to be a smart savvy investor for the first time likely in your life.

I just had a long talk with my father who gave me a history lesson once again about the Great Depression growing up in Guelph and later steel town Hamilton who said to just be patient and watch the game play out.

He still laughs about his 1954 Ranch Bungalow in Burlington which both my mom and him live in since new. $12,000 PP, paid in cash and at peak valued $650K, maybe $500K now. First RRSP investor ever in 1968.

Never had a debt in his life, paid cash for everything including cars, happy healthy at the ripe old age of 81 and still at the top of his realistic long term investment plan. Has lost 3% of his 7 digit net worth.

Not bad for a Hungarian Immigrant with a grade 10 education.

#95 Da HK Kid on 04.18.09 at 12:36 am

I need a better proof read sorry!

Buying right now is likely the most ignoring idea you could have especially if you are a Gen Xer who feels you’ve been cheated by the WORLD of Boomers.

shoud read

Buying RE right now is likely the most ignorent idea you could have especially if you are a Gen Xer who feels you’ve been cheated by the WORLD of Boomers.

#96 marcus aurelius on 04.18.09 at 12:41 am

the Other David (#71) :

Ann Rohmer used to have a brain (and her dad was a fine, fine officer and gentleman). But that show “Hot Properties” is the #1 example of a running Advertorial for the forces of disinformation. I wonder how she can go home to her family after going so far into SillyLand pimping the industry in the midst of the kind of meltdown that is even obvious to the gnat-brained demographic that watches her network. Poor Ann – she was such a promising person before the apparent career demotion to a show that pushes the absolute limits of credibility. What’s next? City presents “The TTC Hour”, where disgruntled Scottish communists debate whether their pay should go from $100 to $200 per hour to drive a bus for a few hours while in a crappy mood?

#97 Roial1 (Al) on 04.18.09 at 1:43 am


This above is an interesting read as it pertains to the economy as seen from Asia.

#98 ralph on 04.18.09 at 1:43 am

Hey! I am thankful that when I wake up each morning I can still wiggle my toes. I have a roof over my head and fairly soft comfy bed and still get three meals a day. And no I am not in jail.

During the Great Depression unemployment was around 30%. What is the unemployment today? It is at present still lower then what it was during ’81,’82. Not to say it won’t drop more but we still are a long ways away from reaching 30%.

So, we still have it pretty damn good in this country.

#99 "Joe Six Pack" North Vancouver Citizen Jr. on 04.18.09 at 3:38 am

“”Brace for U.S. protectionism: federal adviser””


But BC/Vancouver have what the U.S. and Asia desparately want….

Drinking Water


Gateway hub to Asia and Alaska

Inexpensive Vancouver Residential Real Estate
(when compared to New York City and soon replacing the Old Girl)

BC Bud…after its legalized of course

#100 Peter on 04.18.09 at 3:45 am

Dear infernalmachine : Yes, I am sure there are TONS of peer and relative pressures all around you right now because if you are Asian, these Asian people are truly believers of HARD ASSETS and their parents will pull out their hard earned cash in their bank (since their GIC maybe yielding 1.5 or 2 %) so, they thought if I give my son or daughter for the downpayment, he or she will GROW that downpayment for me when they need to trade for a bigger home later on…Secondly, these Asian mentality thoughts are as Stocks and Bonds becomes worthless, why not PLOW (I MEAN PLOW HARD) all of my Cash into buying Homes and FLIP them upside down…Thirdly, MEDIA (I mean EVERY SINGLE TV CHANNEL, RADIO STATION, NEWSPAPER) plus the BANKERS & REAL ESTATE AGENTS has co-ordinated so called “BRAINWASH THOSE FOOLS EVERY SINGLE MINUTE NOW SO EVERYONE OF US GET A PIECE OF THE PIE EVENT!!” Lastly, many of my friends also went out and buy a home (they said it was already cheap enough, I said how cheap ? They said close to 8 % discount)..My friends told me buy now and AVOID the Harmonized Sales Tax, take ad. of the CHEAP interest rate..I greet them with my best wishes (of course) but my heart has been praying for them too with these words here –> (ALLIANCES OF HOME FOOLS, GOOD LUCK WITH YOUR OVERPRICED HOME or CONDO, I TRULY HOPE YOU CAN PAY OFF THE BILLS & MORTGAGES AND NEVER GETS LAID OFF !!!)….

#101 Peter on 04.18.09 at 3:56 am

Dear Toronto C9 Renter : Regarding what you said on the post, you are very right on that but what I can say is Many newlyweds and couples are always in the HYPE of home ownership and thought that a HOME can help them to store “TRUE NET WORTH AND TRUE EQUITY” while renting will just make him or herself to spend it all but not trying to save anything…Especially some parents and ladies truly believes Buying a house will make my husband or my son to put true responsibility of the family on the hubby’s belt and renting is not a true family man..(I would say these people are funny but many of them are like that no matter what ethnic group you are)…Many parents also thought that his son will be lookalike DONALD TRUMP too…..(Buy small and trade BIG and BIGGER….)

#102 confused and a little crazed on 04.18.09 at 4:03 am

canuck 99 post 87

we don’t need the link though it is appreciated. All we need to do is look at our grocery bill and credit card statement and it’s all there.

Govt printing money is causing us more expense while bailing out those who risked high and lost

#103 Peter W on 04.18.09 at 6:20 am

Pay off your debt first before even thinking of investing. John Templeton said it a long time ago.
After your student loan is paid for, then buy a house. After you have paid off your mortgage, then you can look at investing. All those advising you to invest in the face of paying off debt just want to collect fees, commissions and expenses at your expense. You have lots of time, don’t be hard on yourself. Make sure your partner is on side.

#104 Dave on 04.18.09 at 9:36 am

hink about what your bank rental will be worth in 5, 10 ,15, and 25 years from now. Scary thought ! The world has changed ! Change with it!

i agree with renting for now, but having considered what a home would be worth in 15 or 25 years from now, I’d bet every penny I’m worth that homes will be worth more then than they are now.

#105 Bill-Muskoka (NAM) on 04.18.09 at 9:42 am

#88 Dan in Victoria

Hear! Hear! Kids today have no vocabulary that is meaningful.

‘Like…’ Oh? You are presenting a comparative analogy or you are clueless as to what is being said?

‘Dude!’ Ah, watched ‘City Slickers’ too many times did you, or listening to the turtle in ‘Finding Nemo’?

‘Dissed’ Well, as we know from a few days ago it still beats being ‘dished!’

‘Ho!’ It isn’t Christmas, learn to read a calender kid! BTW, you do not look at all like the Jolly Green Giant either, except when you show up for work after boozing it up all night.

‘My bad’ Your bad what? Upbringing? Education? Attitude? Brain? Are you admitting your SCREWED UP? That normally requires this simple phrase ‘I am sorry!’

And my least favourite of all when I have said ‘Thank you’ to hear back ‘No problem!’ Like, Dude, are you dissing me? Was there a problem to begin with? Did you just arrive from another planet and are trying to master English as your second language? Especially from a sales clerk.

And my response to the ‘Pluck Yew’ sign…’I am sorry, we do not have a table for one!’

Have a nice day? Thanks, why wouldn’t I?

#106 hagbard on 04.18.09 at 9:45 am

#66 Dead Cat Bounce

Not talking about Windsor. Kingsville, Harrow and Leamington. We don’t want to live in Windsor. Soon as you leave Windsor, the options for renting dry up. We’re currently in a nice place at a good price, but its not long term.

#107 Bill-Muskoka (NAM) on 04.18.09 at 9:46 am

I’m not normal. I crash bikes. I get kicked out of political parties. You really want to be like me? — Garth

Well, you have mastered the comb and razor (based on the pic you posted the other day), and now portray a clean cut Rebel! You Rascal you! LOL Either that or you are the Poster Child for ‘Wear A Helmet’? ;-)

#108 hagbard on 04.18.09 at 9:50 am

#63 Kash is King

The video died about two minutes in, but the real risk doesn’t come from other countries but from the Sun. Its expected to give off a blast of plasma in the next few years that will kock out transformers around the globe. They (NASA) estimates it will take years to get the grid back online.

#109 dd on 04.18.09 at 10:56 am

#99 “Joe Six Pack” North Vancouver Citizen Jr.

“4/ Inexpensive Vancouver Residential Real Estate”

You mean after the real estate melt down

#110 enough already! on 04.18.09 at 11:07 am


I have been an avid follower of this blog for some time. While I agree, these are not the best of times, they are certainly not so doom and gloom as everyone who posts on here thinks. People just love to feast on negativity. Yes, unemployment is up, jobs are disappearing and things are bad for many. But life goes on for many of us. 92% of workers are employed. Many of my co-workers have lost their jobs, but most are now employed elsewhere.

Also, not everyone bought a home in the last few years and is over leveraged. I own a summer home in Toronto, and winter home in Boca Raton, Florida, both bought many years ago, well before all this madness that drove prices to crazy levels. I bought within my affordable range and put 25% down with conventional mortgages. I resisted the urge to move up to the monster homes, many of my friends were moving to over the years, with the monster mortgages.

So I find myself with two modest homes, both in great neighborhoods, and with mortgages that will be paid off in the next year or so. I also have a tidy sum in my RSP. Yes, I may not get the price I could have gotten recently, but I am still well above what I paid in both situations.

In 1960, my parents bought their home for $12,500 and had to stretch to do that – they couldn’t even come up with the down payment, so Shell Oil gave them the down payment, so long as they bought your heating oil from them. Things are always relative, aren’t they.

Every now and then a house on my street goes up for sale and is sold within days. The notion of selling my home and renting does not appeal to me. I’ve been an owner and a renter. I remember dealing with Landlords who are horrific and uncaring about their tenants. Trying to get something fixed was usually a complete hassle.

Everyone seems to be forgetting one thing – yes home ownership has its financial ups and downs, but the pride of ownership and not having to deal with evil landlords trumps everything else in my books.

I’ve been in the business world long enough to know that everything moves in cycles. What goes up, must come down. We are most certainly in a down cycle, but also most certainly things will turn around at some point. People will just have to get back to living within their means. The next generation of home buyers will have to learn that. And there will be a next generation, there always is….

#111 Alberta Ed on 04.18.09 at 11:16 am

Geeze, that really hurts about the ‘King… Been riding for 31 years and finally invested in an Electra Glide last year. My rules for riding: 1, You’re invisible; 2, Even though you’re invisible, everyone out there is trying to kill you; 3, Any pavement you can’t clearly see is covered with greased B-B’s. Finally, wear all your PPE.

#112 Just a Carpenter on 04.18.09 at 12:00 pm

The greater fool supports a sports franchise that pays a person tens of millions to play game resulting in no benefit or value beyond entertainment.
Drives a vehicle that costs as much as my house to work and back on salt coated streets
Pays hundreds of dollars for a pair of shoes that can’t even keep your feet warm or dry
The renter who believes that landlords are charitable.
Do you really think that the property tax, interest, insurance and maintenance costs are not passed on to you? Do you also realize that tenant insurance rates are almost double that of homeowner rates? As I said before, there are many reluctant landlords out there settling for whatever income they can muster to save their speculative properties from bankruptcy. Yes there are deals to be had in renting now but how long will it last? You claim it is poor economics to be a homeowner yet you believe those same economics don’t apply to landlords? You want someone else to assume all risk and costs of ownership standing by to serve your every whim?

THE GREATEST FOOL believes in enhancement before charity, material possessions above relationships, and rewards without responsibility.

#113 "Joe Six Pack" North Vancouver Citizen Jr. on 04.18.09 at 12:25 pm

In an earlier post, as it affects Real Estate Values locally, I asked Garth whether the CAW/GM/Chrysler situation in Ontario was a Federal or Provincial issue.

No response

Garth is an excellent journalist/critic regarding Real Estate values across our country, however the only solution to date by him is “get your own bunker w/ generator and stock it w/non perishables.

I for one have also repeatedly posted critiques as well as many solutions…unfortunately w/ many deletions by Garth.

This blog site is becoming stale…..no new fresh ideas.

Garth is depicting himself as a Captain ready to go down with his Ontario Bunker, analagous to a motorcyclist going down in a crash w/ his Harley.

…Looks like I may have to lead as Prime “Ministership” (no pun intended) of the for the “New” 21st Century Party… of whats left of Canada.

#114 Big Picture Guy on 04.18.09 at 12:47 pm

Jesus as I read more and more replies on this blogg over the passage of time, Garth’s message has not sunk through to the wannabe Greater Fools.

Real Estate should not be considered an investment. Long term RE rises only with inflation 4%. If it wasn’t for the non taxable capital gain on, your primary investment your ROI would be -ve. Many of these idiots don’t consider mortgage interests paid, property taxes, maintenance, RE Commissions etc. You need to factor those expenses in your ROI calc.

The average joe just looks at the price purchased and selling price and automatically assumes look folks I made money on my home. When in fact you made less than a savings account rate.

#115 Bill-Muskoka (NAM) on 04.18.09 at 1:23 pm

#95 Da HK Kid

I hate to say this because you’re a good poster, but the word is spelled ‘ignorant’. LOL

All of us, of course, have trouble with ‘ants’, be they the crawling variety or the ‘aunt’ variety.

The worst being the V.I.P. type, aka, Vicious Ignorant Pissants! LOL

#116 @Garth 2 on 04.18.09 at 1:33 pm

The April mid-month numbers are out for TREB:


I’ll just shut up about it, and ask the council here… what’s the deal with Toronto?

#117 DG on 04.18.09 at 2:43 pm

@91 marcus aurelius: I think you mis-read my comment. I was making the same point as you – renting, not buying, is the bargain option in the Toronto and Oakville markets. In fact there is currently a house in Oakville listed for sale for $1.4 million, but also for rent at $2,995 / month. I can’t see any possible argument for buying it rather than renting it right now.

#118 rory on 04.18.09 at 3:04 pm

#93 Grumpydawgs you said:
“The fact is that milk is up 39% in the past 12 months, a loaf of bread at the supermarket is up over 100%, meats are up 40++%, vegetables are all up more than 20%, Fruits -ditto etc etc etc. Inflation for the things we consume is RAGING IN CANADA.”

Best part is that we do not need to consume dairy or any substantial quantities of meat. So if we got rid of the subsidies to the stuff we don’t need to eat like meat and dairy and subsidized the stuff we do need, fruits and veggies, then the inflationary price will be contained.

As to all the ‘greenies’ or climate change types this is exactly what you should be hoping for – dairy and meat unaffordable given the greenhouse gases they create and amount of food & water they consume for the output they produce – very inefficient.

#119 . . . fried eggs and spam . . . on 04.18.09 at 3:38 pm

“I’m not normal. . . .” — Garth

Way to go! Welcome to the World of Not Normal Degenerate Weirdheads, where Nobody Knows What’s Going On, and Nobody Cares Either! Ahhh, ‘tiz a grate playse 2 B!
#108 hagbard at 9:50 am — “. . . They (NASA) estimates it will take years to get the grid back online.”

By which time, all of us will have broken on through to the other side anyway, due to no food and water so we’re only here for a short and great time!

However, this leads to #99 “Joe Six Pack” North Vancouver Citizen Jr. at 3:38 am

If there’s nothing but desolation left after the plasma burst from the sun, I ‘spose Novvrouec will be the Gateway To Hell on (broke) Air Canada Vacations!

#120 Too Old Bob$ on 04.18.09 at 6:08 pm

Sitting in my recliner reading the paper, then all of a sudden something pulls up and blocks my view, plus takes up the whole width of my lot. Holy Earth Day Crap!
The kid (now 28 years old) that I’ve known since he wore diapers just pulled up with a brand new 38 foot Trailer and F350 Ford Truck. His parents live across the street. I fall out of my chair as I proceeded to get up and run outside to admire his Baby. I meet his new girlfriend and asked him what the heck is he going to do with this. He looks at me (as if I’m old and blind) and says: “going camping”. Duh!!

After some small talk I ask if he would be willing to trade straight across for my house. He just laughs and says: “no way man, you’ve got yard work” he he! true.

Eventually I work my way back to the house pondering his answers. I guess he didn’t take in account that one is paid for and the other (which depreciates more) isn’t.
Oh well, they looked happy.

As soon as they leave I’m going over to smack his Dad in the head for allowing him to buy it. lol.

#121 dd on 04.18.09 at 6:12 pm

#113 “Joe Six Pack” North Vancouver Citizen Jr.

“No response”

What is wrong North Van? Nobody taking you seriously?

#122 lgre on 04.18.09 at 6:35 pm

Just a Carpenter – I cant understand why you are trying to justify a purchase over renting in this current market, I am in favour of ownership as in the long run even dumbest of the dumb can have some type of asset and have something saved, but in this current market it’s not worth buying..I dont think you realize one thing very important..when you rent you put down first and last and that’s it..when you buy you put down dp alot larger then that if you want to have the same number at the end.

#123 lgre on 04.18.09 at 6:40 pm

“I’ll just shut up about it, and ask the council here… what’s the deal with Toronto?”

what deal? the market is still down yoy that is the deal..in the 80’s when the bubble burst, it took over 7 years until re hit the bottom..this time is no different..infact, the only thing proping up the market is the cheap rates..once that is over you will see a very quick decline. Hope you’re ready.

#124 Val Mel on 04.18.09 at 7:08 pm


You are quite arogant for a person that is close to being illiterate….

#125 Zoronqueen on 04.18.09 at 7:18 pm

# 2 squiddly –
Yes we were one of the greater fools who bought in Sept. After saying that though… We managed to sell our old house at 280K, mind you 55K below assessed value.

Had a friend who bought a older house in Greenfield, Edmonton at 310K, 10K above asking and I think they are nuts. However same with Ben here, there were itching to buy as their rent was $2200 a month. But it was for 2200sqft bi-level. Right now they have to downsize to a 1200 sqft home and be slaves to the bank for 35 years at $900 a month, what a deal….

#126 . . . fried eggs and spam . . . on 04.18.09 at 7:25 pm

Sucker rally! Ignore the fact this is a gold site, there are three charts on here — http://tinyurl.com/c9bonu which look at three bear markets: 1929 – 1949; 1966-1982 and 2000 – 2007.

Most of the written stuff is partially interesting, but should be taken with salt, pepper and ketchup, or face value.

Leads to a one minute YouTube showing of how to turn a recession into a depression


#127 rory on 04.18.09 at 7:32 pm

#124 Val Mel you said:

“dd, You are quite arogant for a person that is close to being illiterate….”

Yikes …what the heck was that. And you spelled arrogant wrong …ooops.

Your kind of, maybe, supposed to, reply to our esteemed NVC Jr. dd is just taking a kind of, maybe, supposed to special interest.

#128 Sun Yat-sen suit on 04.18.09 at 7:46 pm

Spectacular corporate failures

Anybody care to speculate? intials &/or hints welcome.

#129 Brent on 04.18.09 at 8:37 pm

In Edmonton you still pay two and half times as much for a single wide over looking your neighbours garbage cans then you would for a high rise condo in Windsor overlooking the river and downtown Detroit. I don’t think you can see if the GM tower is boarded up or not from across the river though.

#130 kitchener1 on 04.18.09 at 9:02 pm

RE: #94 The HK KID

Great points, my parents are both from Eastern Europe as well, same mindset as you mention. Growing up, my parents never had any debt(expect the mortgage). Everything was paid for in cash, if the did’nt have they did;nt buy it.

For the older boomer generation from Europe anyway, debt was really looked down on, almost like a curse. Unlike todays generation were it is looked upon like a right.

After this recession, I thing people will be a lot more debt adverse then before

#131 dd on 04.18.09 at 9:20 pm

#124 Val Mel

Hey illiterate boy the word is arrogant not arogant.

So you are in favour of North Vans racist rants? If he has something useful say that is one thing. But he can leave the racist remarks out.

#132 Truth Be Told on 04.18.09 at 11:43 pm

Garth, what is your take on the latest pressure on the Canadian Autoworkers?
My take is that if the powers that be push too hard and far, there will not be an auto manufacturing industry left in Ontario. If GM, Ford, and Chryco are allowed to fail, then there are a massive number of people with out pensions, plus most of them will be headed for the welfare rolls.
What the media has not understood is that the auto industry pensions are not funded like the normal pension plans.
Harper, Flarhety, et al are playing with TNT not fire!

Once the mfgs are down, so goes their dealers, and parts distribution, then 2 or 3 of our banks that are carrying all that inventory on their loans.
These pensions were allowed to stay outside of the pension reforms enacted earlier in Ontario simply because it was thought that the big three would never fail. If they go so will the parts mfg, then the Oriental mfgs will retreat to Asia. The worst case scenerio is that this can bankrupt the Provinces and the Federal Gov’t. Just how many retirees can we afford on welfare?
Then where will your real estate go? Back to weeds and brush?
Do you see any sanity in this current round of demands?
As my laid off auto worker son says it is wrong that he was making more than double what a fully trained, licensed mechanic in a repair garage makes, but the Autoworkers Union did not think of that nor the practice of other unions to require the employers to deposit the pension funding with the union’s financial trustees for investment and management each quarter year!
Do you disagree?

#133 Just a Carpenter on 04.19.09 at 1:38 am

Sorry to mislead you, I do not advise purchasing in this market, just can’t understand why anyone would want to be a landlord unless there is fair return on investment. If it doesn’t make economic sense to be a homeowner is it not as senseless to be a landlord?

Also we are a society of foolish spenders on alot of big ticket items, not just on housing.

#134 Da HK Kid on 04.19.09 at 3:06 am

#115 Muskie Bill yes one negative about living in Asia is your spelling hits the bricks and everything moves at light speed. Hoping to slow down in another country. cheers.

#135 grandeprairiegirl on 04.19.09 at 11:32 am

#63, #108 & #119

2012 is about more than the sun and MCE & EMP’s.
That’s Electro Magnetic Pulses and Mass Corona Ejections.
Every 26,000 years or so there is also a planetary alignment and I think a polar shift. Something about the earth’s rotation reversing and some other not so wonderful things. You can google these things for yourselves.
On the bright side, if the above really does come to pass there are estimates of tsunami waves with a potential height of up to 7000 feet. Sayonara to North Vancouver Citizen Jr. He’s living at the wrong elevation.

#136 grandeprairiegirl on 04.19.09 at 11:39 am

To my prior post. This was also predicted as a similar scenario in 1982.

#137 Glenn on 04.19.09 at 9:43 pm

Hawaii foreclosures soar 503 percent

By Allison Schaefers

POSTED: 06:29 p.m. HST, Apr 15, 2009

Hawaii’s foreclosure activity rose a staggering 503 percent in March, the ninth consecutive month of double-digit increases for the state, according to RealtyTrac.

One out of every 700 households in Hawaii, or 724 homeowners, experienced a foreclosure filing last month. March was such an active month for foreclosures that it represented 47 percent of Hawaii’s quarterly foreclosure activity.

“Hawaii has always been behind the mainland a little bit and we are seeing signs that it is starting to catch up in regard to foreclosures,” said Blomquist.

As foreclosures in the state have ramped up, so has the state’s ranking . A year ago, Hawaii ranked No. 26 among all states for foreclosure activity. Now, it’s 44th, Blomquist said.

“Hawaii’s foreclosure activity is getting more serious,” he said.


#138 Midget Porker on 04.21.09 at 9:55 am

I had a Kelowna RE agent tell me that, “Yes, the market is down, but on the bright side it is so much cheaper for Americans to buy now. Which will bring the market up.” My reply? “Americans? You mean those neighbors to the south that are in a worst position than us? The position we may rightfully be in, in a years time?”

I swear they never see the entire picture.