On the horizon

I’d like to think it’s because I’m a financial rock star. You know. Limo. Bimbos. Biker security. Illicit substances. Leather shirt taut across my rippling six pack. But, sadly, this ad on Criagslist says way more about Vancouver than it does me:

Yes, I am speaking tonight in the city made globally famous by ‘Crack Shack or Mansion,’ when a million dollars buys something people in Winnipeg would park in. Only here would some dinglenuts scalper try to foist a pair of free tickets for $250. I wonder if there was a bidding war, multiple offers and tears. Maybe a realtor is involved, telling clients a Garth Turner event is different in Vancouver because of insatiable Chinese investors, majestic, hulking mountains and the fact they’re not making me anymore.

Well, it should be an interesting evening. I’d say the real estate biz in BC (and the rest of the country) is running scared – not from me, but from the reality of our times. Sadly, and as usual, the pumpers are being supported by an uncritical media which over the last few hours has been in overdrive trying to convince people the great real estate correction of 2010 is already over.

There was CREA, for example, trumpeting the news that home sales across Canada rose by 4.1% in August from the previous month, the first increase in a year. That was enough to make outlets like CTV all creamy. Even more egregious, however, was the effort by the BC Real Estate Association, and its chief comedian Cameron Muir.

August sales in BC were also ahead of those in dismal July, which Mr. Muir attributed in part to lower mortgage rates (actually the Bank of Canada raised short-term rates a half point while long rates fell two-tenths). Adding in a drop in listings since April (five months ago), he reached this stunning conclusion: “this signals that an end to the buyer’s market may be on the horizon.”

And how did the media react? Like Mr. Muir’s personal love slaves.

So much for balance. Lost was the fact residential real estate sales actually crashed 35% in August from last year, making this the fourth consecutive period of a bear housing market. Also unmentioned was the 2.9% drop in average prices in Vancouver since the April peak which does not likely signal the end of a buyer’s market, but the faint beginnings.

And as for CREA’s numbers, most media did not manage to include news that prices across Canada slipped again in August, and are now 6.3% below the peak hit in May. That’s 6.3% less in 90 days. Gulp.

So how do we explain additional buyers in BC last month, paying more for houses? Easy. After all, this is the place where free tickets sell on Craigslist for $250. Where residents think people would choose over London, New York, Paris or San Fran. It’s the bubble, and trying to look through it can be brain fatal.

In fact it’s this loss of perspective which likely explains Cameron Muir’s unique world view. When prices tumble a few percentage points, fear grips Yaletown and Richmond, families start to break asunder and people look up, searching the skies for incoming Asians. Global TV sends out a crack team to report on a devastated woman who might have to sell her condo for, sob..oh the shame..less than she paid a year ago. That night during the newshour intro, the anchor looks misty.

As a result, out come some early vultures, thinking that a SFH selling for $895,000 which used to be 1,025,000 is a steal. And it doesn’t take too long before there’s an impact on real estate statistics in a thin market. Sadly for the vultures, however, they stand a good chance of learning a painful lesson thousands of their feathered Yankee friends encountered four years ago.

You see, Cameron Muir is to BC what David Lereah was to the American housing business, as chief economist for the National Association of Realtors. When the US housing bubble started to pop in early 2006 there was a quick decline of less than 10%. On September 25, 2006, Mr. Lereah told the media (who reported it): “We’ve been anticipating a price correction and now it’s here. The price drop has stopped the bleeding for housing sales. We think the housing market has now hit bottom.”

Any vultures, or trusting young buyers, who acted on that expert opinion bought into a market which would fall precipitously, losing up to 70% of its value in certain cities. And today, four years later, it’s still crashing.

So, like David Lereah before him, is Mr. Muir making an irresponsible statement, saying a buyer’s market may be over before it actually starts? Is this what an industry association opinion leader should be doing? Is it in the public interest? And if not, where are the media checks and balances?

See what I mean? The place is nuts. Delusional.

This is what happens when people pay seven figures for a crack shack, then try to convince everyone else it’s wicked smart. It’s how a fine province goes fetid when it thinks real estate is the economy. It’s what declaws reporters who worry about their condo value first and the news second. It’s how shelter’s rendered  unattainable and average families sink into unrepayable debt reaching for it.

Nobody should be proud of this. Or mistake what’s yet to come.

And to the greater fools who paid $250 to come and hear me tonight, well, suck it up.

The doors will be wide open. I’m in enough trouble already.

185 comments ↓

#1 Foggy on 09.15.10 at 9:07 pm

I look forward to your post-mortem analysis of the evening.

#2 CrowdedElevatorfartz on 09.15.10 at 9:39 pm

Yup, thats Vancouver for you. If its free it cant be worth seeing.
Home of the $5.00 coffee
Home of the $500 K leaky condo
The Be$t place on earth

#3 concessionman on 09.15.10 at 9:41 pm

Be Careful…don’t forget the Kevlar and your Helmet!

#4 Old_is_Gold on 09.15.10 at 9:46 pm

Does this post not prove the fact that the media are in bed with industry who are in bed with the the bankers who are in bed with the government and all out to fleece the very public they profess to serve.

Government through higher taxes and surtaxes (taxes on taxes) and fees of all sorts

Bankers through much higher interest – higher the price of the property, the more the bank will make, and in case they lose, they have nothing to fear for their losses are already covered. No fear in betting big in their case.

RE and related industries all raking in money from the gullible public (who are not entirely innocent greedy but rather Donald Trump wannabees)

And the media lie through their teeth to do all they can to keep the public uninformed, rather misinformed,

And so the game goes on and on, round and round she goes, where she stops – well, we won’t find out for a while yet where the RE wheel is going to stop but BANKRUPT seems like a good bet for its final destination.

#5 Taxpayer like everyone else on 09.15.10 at 9:55 pm

“Where residents think people would choose over
London, New York, Paris or San Fran.” – Garth

While Vancouver now holds the dubious unaffordability championship for the industrialized anglophone world, it is but a speck of 2M compared to the other three cities
for which we have data that comprise maybe 30M people
between them?

Conclusion: Vancouver is NOT preferred by a ratio of 15
to 1 by people who are willing to spend their brains out on housing.

Neither a pump nor a bash. Just a number.

#6 hobbygirl on 09.15.10 at 9:56 pm

Lol! Can’t wait for your next post, will be interesting to say the least.

#7 Boombust on 09.15.10 at 10:00 pm

I watched that puff piece by Cameron Muir on Global News yesterday.

They should be ashamed of themselves. Of course, Global, being the shill-a-vision that it is hadn’t the slighest hesitstion to believe that idiot.

Really quite audacious, to say the least.

#8 april on 09.15.10 at 10:05 pm

I’m still asking the same question because, since I can’t access more then 7 to 10 comments, I don’t know if Garth has posted it or not. Is anyone else having difficulty accessing the comments over the past few days since Garth’s wed site was attacked?

#9 echo on 09.15.10 at 10:06 pm

wow that was the shortest “buyers market” EVA!

Isn’t Global aware that almost every other night in the past two weeks they’ve been talking about a troubled Canadian real estate market, debt etc… do they truly believe that’s changed in one day? really?

#10 Coho on 09.15.10 at 10:06 pm

The only thing corporations understand is money. Perhaps a class action lawsuit by sucked in soon to be underwater property virgins against the broadcasting megalopolies, would reign in their cavalier “fake news”.

Yes, people should be accountable for their actions, which should also include the MSM. Unfortunately too many people still take the sound bite 6 o’clock news as gospel and consider it all the information that they really need to know to manage their lives.

There’s something very wrong with a system that throws every hazard into the path of people as they try to make their way through life. Without a middle class, there cannot be freedom. There can only be “peace” through suppression and tyranny in a country where 2% have the wealth and 98% are the working poor. And that is what may very well be the outcome as the global economy with such a disparity in labour wages between countries reaches equilibrium.

It is a longshot that working class people will truly class jump especially as Canada and other western countries are riding a course from 1rst world to 2nd world status.

#11 echo on 09.15.10 at 10:07 pm

I would definitely chose Vancouver over San Fran though…no question

#12 Chaos on 09.15.10 at 10:14 pm

I find it hard to believe that there are 400 hundred people in all of Vancouver that aren’t suffering from a cranial/rectal inversion(AKA Zombieitis) vis-a-vis the Golden Age of Real Estate Investment and the deflating market value of their property.

G-man, word to the wise, put a shout-out to the Dawgs and position them in the front row with their chairs turned toward the audience. Arm them with wooden stakes and silver crosses.

Keep the car running in the alley and check-in under an assumed name.

Good luck and Big Balls!

#13 Publius Enigma on 09.15.10 at 10:15 pm

You’re going to be a martyr Garth.

Forty virgins await you in paradise.

Property virgins, that is.

#14 Wise Guy on 09.15.10 at 10:16 pm

Moody’s in the US stated today that U.S. home prices will continue their decline for three more years! How is that for psychology!

#15 Coldlazarus on 09.15.10 at 10:17 pm

I go weekly into the left coast, and in fact, Real Estate IS the economy – driven in part by the-also-never-mentioned-in-the-mainstream-media: BC Bud and the cash economy the and collateral damages.
Fishing, mining, forestry -forget it

If Bud was legalized and if Real Estate falls, oooh, well, BC will need those tax revenues from Bud.

#16 JET on 09.15.10 at 10:22 pm

That video was really difficult to watch. The anchor was so giddy when he pronounced the good old buyers better buy sooner rather than later. Optimism is one thing but bending the truth is quite another.

#17 mel on 09.15.10 at 10:25 pm

We should be reminded that all things don’t go down in straight line. There will be months when things are looking up, but, don’t be fooled, the trend over coming years is down.

Even in the States it has been going on for about 5 years, and still more to go. It won’t be finished until everyone who thought this is the bottom will be out of the game, and bought too early. I am planning to be the last one at the feast table. I am waiting!

Has anyone noticed mortgage mutual funds recent semi-annual reports are stating in fine print as to how many mortgages are 3 months or more behind their payments? TD Mortgage fund has reported in January/2010 one mortgage 3 months behind. This June/2010 they reported 7 mortgages behind.

I wonder how the other mortgage mutual funds are doing?

#18 blase on 09.15.10 at 10:27 pm

Re: Yes, I am speaking tonight in the city made globally famous by ‘Crack Shack or Mansion,’ when a million dollars buys something people in Winnipeg would park in. Only here would some dinglenuts scalper try to foist a pair of free tickets for $250. I wonder if there was a bidding war, multiple offers and tears. Maybe a realtor is involved, telling clients a Garth Turner event is different in Vancouver because of insatiable Chinese investors, majestic, hulking mountains and the fact they’re not making me anymore.

This is seriously, one of the funniest things you have ever written.

#19 Eric on 09.15.10 at 10:34 pm

umm,

I signed up so many times for the vancouver event since it was first posted and have not got any emails back?

Can we still go without tickets? I am very confused. I REALLY want to go but never got any email responses.

Just show up. One of my oversexed groupies will assist. — Garth

#20 Patz on 09.15.10 at 10:39 pm

Look at the lovely view but don’t stand too close to the edge—ooops!

No, that’s not a train but if it is it’s going the other way besides a train has never come down this track before; it’ll realize it’s mistake and stop before it hits me—ooops!

The situation here in lovely B.C. by the water surrounded by mountains is beyond comment. As a lapsed journalist I’m appalled by my former colleagues lack of even the slightest balance or rigor in their reporting. They are simply making ads for the RE industry.

And when it tips over they will all make like deer in the headlights and say, “who coulda known? Nobody saw this coming.” No indeed how could they have—all together now everyone: first the Boy Scout salute and (fortissimo voce) IT’S DIFFERENT HERE!!!

#21 Peter Pan on 09.15.10 at 10:41 pm

Garth, hate to break it to you, but scalping is almost a legitimate career choice here in Vancouver. I hear Capilano College will soon offer a first year course in Scalping 101. The credit can be used for the real estate license course…

This is a city which thinks selling things to each other is the preferred way of creating a thriving economy.

#22 EB on 09.15.10 at 10:45 pm

“Does this post not prove the fact that the media are in bed with industry”

I think it’s more likely that most people who work at the local TV station are homeowners too, and are looking for reasons to believe the party won’t ever end, just like everyone else.

#23 Skeptic on 09.15.10 at 10:48 pm

Vancouver is not preferred, perhaps, 15-1 over London, NYC, Paris, or SF. But there clearly are (or have been) enough “fools” here to keep prices in line with those cities.

Idly looking the other night, I found a place on the Upper West Side that’s larger than my Gastown rental, and almost exactly the same number of dollars to buy. It’s a block from Central Park, a walk across which gets you to the Metropolitan Museum of Art. I needn’t go on.

Vancouver is suffering from the “world class city disease” that Toronto experienced in the late 1980s. That stupid, unnecessary new near-billion-dollar roof on BC Place reminds me of nothing so much as little boys playing in their sandbox.

However.

There is no denying that all the bear arguments have been, well, arguably true for years now. Prices, though, stubbornly stay high, defying logical argument. I see nothing in particular to differentiate this moment from any others in the last, say, seven years. Prices aren’t budging, at least in the places I’m looking at, and they are selling. Not as fast as before, but the sell-list ratio is still very comfortably over 50%.

If it doesn’t change soon, and I’m really beginning to doubt that it will, you’ll be able to find me in a jazz bar in Gotham in a year or two.

#24 Jeff Smith on 09.15.10 at 10:52 pm

>And to the greater fools who paid $250 to come and
>hear me tonight, well, suck it up.

>The doors will be wide open. I’m in enough trouble
>already.

Now that’s slick. I could have made myself some money there. Uh, Garth, when are you scheduled to speak in Toronto again?

It’s now Nov. 9. — Garth

#25 Nonplused on 09.15.10 at 10:57 pm

Meanwhile gold hit new nominal highs this week. Also this week our old friend Alan Greenspan, chief bubble inflator of the US housing debacle, described gold as “the ultimate form of payment”, and George Soros described it as “the ultimate bubble”.

I’m not sure what ol’ George means by that, whether he means gold is in a bubble or that it will be, but his funds have nearly a billion dollars in gold related investments all the while he is describing it as “risky”.

What Alan means we know because he described it in detail in a paper in 1968, long before he became Chief Inflator of the Federal Reserve. Central banks might not like your credit, your bonds, or even your freshly printed 10 trillion dollar Zimbabwe dollar bills, but they’ll always take your gold at some price. As the great J.P. Morgan is credited with once saying, “gold is money, and nothing else is.” Although I don’t believe that is true, there have been successful coinage made of silver, copper, nickel, and more recently zinc throughout the ages. Always a non-corroding metal though, and preferably a shiny one because people like shiny.

Why metal? Well, once it’s minted, it’s guaranteed to contain a certain amount of said metal which can then be bartered for other less durable goods and services like milk and eggs. So when you pick those up on the way home from the work what you are really doing is trading 649 small slugs of zinc with a slight copper alloy for the milk and eggs. It seems more complicated but it isn’t.

Paper money is a metal derivative. When you accept paper money for the above transaction, a “bank” (the central bank in the modern example) that issued the paper promises to pay the bearer in coin upon redemption at the bank. It still works today, if you really want to you can go down to the local branch of any bank and trade your $20 bill for 2000 pennies. Not very convenient but you can do it. Now you have the zinc. (And incidentally, the zinc was worth a little bit more than the $20 last time I checked.) US currency used to actually bear text that said the bill was exchangeable for gold, which was a bit weird since the US dollar is defined as 360 grains (a unit of weight) of silver.

But anyway, no central bank “pays” a set amount of gold or silver for a paper bill anymore, but you can still exchange the bills for nickel and zinc. These metals have been “demonetized” along with copper and now trade at large premiums to the paper derivative. (Silver is around 20 paper dollars per ounce whereas the dollar is defined as one ounce, gold is at $1265 whereas it formerly was exchanged at one ounce gold to 20 ounces silver, and I don’t know where copper is but they aren’t going to go back to making pennies out of it I can assure you. You get zinc. With a bit of copper thrown in for looks.)

Some gold bugs like to make charts that show the prices of stocks, etc. in terms of ounces of gold. This is easy to do, you just divide the stock index by the gold price and see what you get. Some of the online charting tools will allow you to do this automatically.

If you do this, the result is striking. Houses, stocks, wages, cars, everything but certain commodities are well off their highs reached around the year 2000. The charts make a similar comparison to the 1929-1939 period. In short, we could already be in a depression, and you can pick your start date at the dotcom crash or the US housing crash or wherever, whatever you see on the chart. This would explain the persistently high unemployment even with trillion dollar stimulus combined with trillion dollar Quantitative Easing programs. All they did was revalue the paper currency to mask the problem.

Oil, when priced in gold, is actually fairly reasonably priced right now, which is what you would expect in a recession/depression.

Industrial production in the developed economy is still down in volume, which is also consistent with a recession/depression, although prices are not off that much. This is because sales are down, also consistent with recession/depression. In fact, sales are down so much, that certain industries like the oil patch are seeing shortages of certain components to the supply chain because the companies that make them won’t restart another shift or plant because demand in other sectors they supply are still slow and there is too much uncertainty. That, my friends, is causing double digit inflation and bidding wars for certain equipment and services that depend on that equipment. If that trend were to continue into the general supply chain, the economic consequences would be quite catastrophic in dollar terms.

Luckily it’s not serious. It’s hopeless, but not serious. Even if the system collapses it doesn’t take long to patch together a new one.

Look at Russia. How long has it been since the Soviet Union utterly collapsed? 20 years? Oh sure, they are a shadow of their former selves, but they are back on the world stage in the revised format. The lights are still on and public transit is still light years ahead of in the US.

Russia is even building pretty sophisticated military equipment again, although more in the missile, aircraft, and air-defense areas than say tanks or aircraft carriers. Although it’s been a long time since the US commissioned a new aircraft carrier either. Sitting ducks they are, these days. Even China can sink them from 2000 miles away, and they have been selling the capacity to do so at a shorter distance for years. Practically anyone who wants to sink an aircraft carrier now can, and that includes Iran.

There is an old wisdom that the last major act of a dying empire is to invade Afghanistan. The US is the strongest there ever was, so they managed to get Iraq in there too. But I say plan for the unraveling. It hasn’t happened yet despite Garth’s “all clear” signal. The system is yet to collapse. And no worries! The system sucks anyway. (Really, it does. It’s killing us financially.) There will be a ton of wealth created after we throw off all the things that are currently pulling us under. Once the US throws off its corporatist-government-public union totalitarian like complex of excessive regulation, taxation, and government interference in the economy, they could well go back to being the growth engine of the world again. The have the resources and the know how.

#26 Taxpayer like everyone else on 09.15.10 at 10:59 pm

1 foggy – re last thread @131. The real estate market on the west coast was on a roll in 1989. I remember
shopping for a house. The BOC raised its rates sometime
about then, causing a recession. I remember it well. I went home early that day. Seriously. A one day recession. Phone started ringing off the hood as rates fell and the market cooked for the next 5 years. Fell off very slowly after 94, bottoming about 99, give or take. Yep, 89-94, those were the days……

#27 islander on 09.15.10 at 10:59 pm

Actually, I believe that stat you are quoting refers only to existing home sales increasing. The implementation of the HST in BC has probably caused some substitution of demand from new houses which are subject to a higher tax rate than existing homes which only pay HST on realtor and legal fees. I say “demand”, but in my mind I am thinking “delusion” .

Also, housing prices never fall in a perfectly straight line down to the trend line and beyond. They bump and bounce between greed and panic. This means that there are some slight upward movements in what is obviously a secular bear market in RE.

Interesting to look at the RE price chart for every location in Canada and see the classic “head and shoulders” forming. We are now on the second shoulder of this pattern and history shows that this is the classic precursor to collapse. Glad to be on the sidelines waiting to vultch in a few years.

Keep up the good fight Garth.

#28 Old_is_Gold on 09.15.10 at 11:05 pm

The trailer for the movie soon coming to Canadian theaters everywhere.

“The trouble with many of the “indicators” we report is that some are pretty current and others are severely lagging. Home sales are generally the former and home prices the latter.

That’s why, given the combination of the expiration of the home buyer tax credit and the increasing number of loans moving to final foreclosure, we knew that home prices overall would take a hit, but it would take a while.

Well we’re here. ”

Full CNBC report: http://www.cnbc.com/id/39192979

#29 JM in London on 09.15.10 at 11:11 pm

172 McSteve from yesterday

Here here on that – I’ve dealt with politicians and beauraucrats all the way from municipal to federal levels and I’ve yet to see evidence of general qualification or ability. It’s why I take the foil hat bunch with a serious grain of salt. I’m even more dubious of the whole conspiracy theory movement as the levels of incompetence at all these levels (even if you grant that the groups – builderburger, Jesuit, masons etc…- domexisit and have an agenda…to which I say MEH) suggest that any cohesive attempt will disintegrate as fast as the plans could roll. Great place to keep the foil hatters busy.

#30 wetcoaster on 09.15.10 at 11:16 pm

Awesome post of all time Garth. Muir’s spineless attempt at swaying mass opinion while ignoring all other stats, along with the assistance of Global TV is the most disgusting example of a bias media I have ever seen.

Toss in the too many Remax ads and the RE agent they have on the weekly noon news pumping her properties and the announcers intentionally implying that you better buy now, but no mention of the TD bank report the same day ?

There’s no doubt now that Global TV is nothing but a sham for the real estate industry. Investigative and fair reporting doesn’t exist unless someone with a lost kitty cat or a bear or two in a grow-op shows up. That video will be one for the history books post crash.

#31 Old_is_Gold on 09.15.10 at 11:16 pm

Shocking CNBC Headline: “Home Price Double Dip Begins”

As our neighbors sink deeper after managing to come up for air for a few brief moments, the Canadian RE Titanic has just begun to hit the iceberg, and there ain’t enough lifeboats to bail everyone out.

http://www.wideawakenews.com/

#32 paulb. on 09.15.10 at 11:19 pm

Damn Muir, I can understand selling your soul to rock like Jimmy Page, shoot hoops like Michael Jordan or nail hotties like Pitt, but shameless pumper of real estate? You got robbed.

#33 Tonguestump on 09.15.10 at 11:24 pm

Garth, Go rock and when they start chanting your name and pull out the bic lighters and hold them up high, lit – eff em! don’t come out for the gratuitous encore – they don’t deserve you. Let em buy a t-shirt from the roadies and pick up a book.

#34 Vlastibor (original) on 09.15.10 at 11:26 pm

I concur with tonguestumpalumpulous.

#35 JM in London on 09.15.10 at 11:31 pm

G – I’m with you on the insanity. The media and investigative journalisum are no longer the norm as the objectivity went away with the tidal wave of corporatisum. Ah well – that to may much like the real estate market, find some balance at some point in the future which will hopefully also supplant (or hopefully at least chase them back to the shadows) polarized opposition now existing in the blogosphere but perhaps I hope for too much – while you’re on the road,nthe wives and I are headin for the guns n ammo bankruptcy sale right next to boat action across in MI – you think we should try and jam in a showing of the dollar a member dawg mansion?? The boat christening of the JMSS Blockade Runner (name is up for suggestion but I think Kid Rock’s Donzi is the likely candidate) but here I go getting all doey eyed
over bunker provisions. I digress – just make sure your need/want list is up to date K??
I guess I do understand

#36 AnotherLowlyRenter on 09.15.10 at 11:33 pm

Spot-on and made me laugh.

Back during the internet bubble, itulip.com helped me keep my sanity. Nowadays, your blog is one of my first stops. I even read the comments.

My story. Recently returned to Canada. Financially astute. I’ve got enough capital to buy a house in Toronto — without a mortgage. But I can’t bring myself to do it because of the valuations. So I rent.

But there is a part of me that’s afraid I’m wrong. And that housing prices will keep going up — that rates will stay low for too long – that Toronto will somehow become Vancouver.

I joke with my girlfriend that I wish I had no money. If I had no money I’d buy a house in a heart beat.

That’s because if I buy an $800k house today and the market corrects 30% – then I’m out $240k.

But if I had no money, I could get a 95% mortgage, and if the market fell, the most I’d lose is my $40k.And if the bank came after me afterwards? I’d just declare bankruptcy and thank the taxpayers & the CMHC for taking care of it.

#37 Nostradamus Le Mad Vlad on 09.16.10 at 12:01 am


One should know by now to look beyond the horizon, not on the horizon. What is on the horizon is merely the outer covering, and beauty is only skin deep.

Look instead for the causes which inevitably lead to effects. People are still borrowing and spending as if there is no tomorrow. Soon there won’t be a tomorrow, as the piper must be paid in full, and he calls the shots when it is least expected.

Ignore what’s on the horizon, as that is no more than seductive outer trappings. “Or mistake what’s yet to come.” The Full Monty is well underway, so enjoy the show!

Hmmm. Trillions, Yillions, Dillions. Anything else?

SDR’s and the Euro Oui ou non?

China is rapping the US’s wrists a little harder.

Stagnanation and foreclosures. No Double Dip, just a Single Plunge.

A thank you for acting as go-between Iran and Brazil for Iran’s nuke enrichment to 20%?

Oooohh The Pain “CFO Survey: Optimism Tumbles, Employment Picture Bleak” (Duke University)”.

Downturn? Wot downturn!

Audio Garth — You’ve made it to The Big Leagues!

CC Debts increasing slightly in US.

#38 Slats on 09.16.10 at 12:02 am

Hey Garth, is there any room for an inebriated wheelchair guest and a drunken caregiver??

Front row, dude. — Garth

#39 Timing is Everything on 09.16.10 at 12:13 am

Garth said – “The place is nuts. Delusional.”

‘Vital Lies, Simple Truths’, Daniel Goleman….

“People, organizations, governments or whole societies are presented with information that is too disturbing, threatening or anomalous to be fully absorbed or openly acknowledged. The information is therefore somehow repressed, disavowed, pushed aside or reinterpreted. Or else the information ‘registers’ well enough, but its implications — cognitive, emotional or moral — are evaded, neutralized or rationalized away.”(p. 1)

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

#40 US Investor on 09.16.10 at 12:21 am

Wow, that video link is shocking. The media is actually attempting to stir a bit of panic “better buy now!” but it is all made to look ridiculous when you see all the “For Sale” signs in the background. Incredible.

Good thing there is such a strong non-housing related job market in Vancouver!

#41 Sea Wave on 09.16.10 at 12:27 am

Check out the 2006 report from the BCREA welcoming Mr. Muir:

http://tinyurl.com/32qrdnx

Interesting snippets:

“BCREA has a reputation for reliable, credible and . . .” (ahem) ” . . . UNBIASED information, and I’m thrilled to be able to contribute to this tradition of service,” (said Muir)

“Muir began his career in 1986 as a REALTOR® with the Fraser Valley Real Estate Board.”

Said Muir, “There’s no better way to learn about housing market information and how economic conditions impact your neighbourhood than from your local REALTOR®.”

Yeah, riiiiiiggghhhtttt . . . I should get all my “economic conditions” information from . . . realtors.

Methinks Mr. Muir knows which side of his bread is buttered, and by whom. Too bad the mainstream media is so gullible.

But perhaps “one gets the mainstream media one deserves” . . . ‘probably just a reflection of the populace, rationalizing, not rational . . . the ostrich theory abounds.

#42 Timing is Everything on 09.16.10 at 12:53 am

From 1987 Daniel Goleman…Vital lies, Simple Truths vid…

http://www.archive.org/details/openmind_ep574

#43 Tom on 09.16.10 at 12:58 am

Garth,
Will you be talking about the fact that the Lower Mainland has the highest number of leaky condos in Canada? Even recently-built units leak. There was a new high rise building built about two years ago downtown where the windows were actually falling out of the building! Even if that 30% correction ever comes, would it make sense to buy a condo in the Lower Mainland, when the monthly maintenance fees are $250-$400 per month and the quality of the building materials are low and the workmanship is questionable? Will Yaletown (legoland) be the new inner city slum?

#44 The Original Dave on 09.16.10 at 1:00 am

I’m going to say this loud and proud, I LOVE WATCHING BUBBLES BURST….sorry for that. I have a thing for mass behaviour and am always listening to try and grasp public sentiment.

Like the G man is saying, soon the early vultures come out, lol. If you’re bubble trained, you know how this ends up. Anyhow, they’re salivating thinking they’re getting a deal real soon and they got to jump in before the next price rally….wrong! The little uptick happens if they’re lucky, but then the descent comes again. These vultures are left questioning things. They wait a bit. They see prices keep falling. They still are excited because the home they just bought will be more valuable in 2 years than when they purchased and now they’re going to dig in, muster up as much money as they can, and buy something else! It’s a buying opportunity of a lifetime (to them). They go in and they buy again. But wait, prices aren’t stable, they’re still falling. They fall and fall and listings are up everywhere. People are losing interest. They all must be crazy.

Eventually the descent stops. You know what’s even more painful than the descent after an asset bubble bursts? Is watching that asset stay the same value for years after it declined so much. Then for a month or two you think things are picking up again, but the next 2 months you see that that was a fake rally. The asset trades in a small range. Not even close to the amount of attention as a few years earlier. The price rally takes forever. Life has to go on and all a persons money can’t be tied into these assets waiting for them to appreciate. People get sick of waiting.

Finally, when the most die-hard bull who loved that asset at the height of the bubble says ” F*ck This! I’m not investing in this SH*T or anything else ever again!” the bottom is in, price declines are unlikely and you can expect to see prices creep up (not fly up…it would have to be an asset that is scarce or high demand for a popped bubble asset to pop and then fly. Something like fertilizers or grains after severe weather problems).

I hope those of you unfamiliar with how bubbles unfold liked the above. That is how they work.

The asset is always different but human behaviour is always the same.

#45 jane54 on 09.16.10 at 1:00 am

Garth I am also looking forward to a blow by blow account of your Van gig!

#46 rentin on 09.16.10 at 1:15 am

Rags to riches makes for better headlines than riches to rags.

It happens less often and makes a better story.

#47 The Original Dave on 09.16.10 at 1:34 am

I have realtors on my facebook account. Yes, these ones are annoying too. However, I don’t think they’re deceptive – they simply don’t understand markets and economics (these ones in particular).

According to them, business is picking up for some of them. They all comment as they feel they have to stick together because the media is against the real estate industry, blah blah. From what I grasp from their comments they’re expecting some huge surge again like in 2009.

These people aren’t trying to fool anyone, they just don’t understand. I feel like telling them that lending standards were loosened at the end of 2008. Interest rates were dropped at the same time. Our country has been playing buy these rules ever since and the market has priced those terms in already. There’s nothing that bring buying to manic levels again. It would be pointless though, I’d be just another negative person to them. They have to learn for themselves I guess.

Here’s another bubble spotting tip!!! If an asset is constantly in the media and there’s two sides disputing whether it’s a bubble or not, it’s a bubble. Something that gets that much attention from people asking whether it is over priced or not is……. over priced. If headlines aren’t dominated by the asset anymore but dominated by disputes of the valuation, you have to be worried about that asset. The asset price can only get that much media attention and consideration if tons and tons of people are in it already and have a vested interest in price rises.

I’m guessing in a few years time, the talk will be: “is gold a bubble”. By that time, it might be. If that’s what you’re hearing, if it gets mainstream attention, and the public is interested in knowing, head for the exits and leave that asset behind.

#48 The Original Dave on 09.16.10 at 1:41 am

just another comment, sorry.

Both sides of the real estate market in Canada, the bulls and the bears feel that the media is against them. Whatever, I don’t care who’s side the media is on. But this should tell us all something. There’s way too much attention in the media on Canadian real estate. Too many people with a vested interest, too many people have gone all in. A lot of fingers are crossed.

The majority (the herd) always loses. The public is right with the trends but wrong at both ends.

#49 dark sad person on 09.16.10 at 2:10 am

#4 Old_is_Gold on 09.15.10 at 9:46 pm

*******************
Most of the time i think-your explanation is right-especially when C speaks-

Other times-in fact-every time-i hear hear F & H speak
i think G is right-because-how could anyone-that f–ken stupid orchestrate any devious plan?
In fact-
I would bet-10 guys on acid-could get their shit together better than those pair of asshats-
C writes the main script-
You know it–

http://www.youtube.com/watch?v=r5U2ZbOESmY

#50 tkid on 09.16.10 at 2:12 am

Dude, please find some kevlar, and let us know you are all right after the speech is over and you’ve safely made it back to the hotel.

#51 Jody on 09.16.10 at 2:55 am

I work with people who seem to be in a buying frenzy out here in Cowtown, even the most “educated,” seem to think housing can only go up. The looks I get and the faces that twist into some kind of look that would scare Freddy or Jason when I put some facts out there is funnier than hell. I can’t wait until the feds double my income taxes to pay for all the defaults, thanks CMHC, pricks.

#52 Stright shooter on 09.16.10 at 4:07 am

How can CTV report this crap. Oh wait, the media isn’t reporters anymore they are parrots reading press releases and looking at ad sales numbers.

How can realtors say this stuff with a straight face? Man, will they say anything and sell out their morals to make a buck?

If anyone buys now without waiting then “A fool and his/her money are soon parted”. Anyone looking on the MLS each week will notice one HUGE trend. What is a “deal” today isn’t as good as the “deal” next week. Sure buy now and month there will be a better house, newer, cheaper and in a nicer area for the same price, and next month will be even better…..

Just ask the Americans.

#53 TaxHaven on 09.16.10 at 4:36 am

And that woman is in a rush to find financing for more than a half-million dollars and to pay who-knows-how-much in interest over the life of the mortgage?

For what? Surrey, for God’s sake…a distant and characterless working-class bedroom suburb of Vancouver, a 40-minute traffic jam away, on a small lot, made of particleboard, aluminum siding and vinyl and requiring insurance, taxes, water, electricity, maintenance and all the usual suburban expenses…

HALF A MILLION DOLLARS!

Cheaper to quit her job, buy in Terrace or Trail and live for YEARS on the savings….

#54 Craig on 09.16.10 at 4:53 am

“When prices tumble a few percentage points, fear grips Yaletown and Richmond, families start to break asunder and people look up, searching the skies for incoming Asians.”

LOL…. LLOOLL!

#55 Brian on 09.16.10 at 5:12 am

Well it looks as though all the $600’000 house buying fools are gone in Vancouver. Now they are chasing the remaining $500,000 fools who think they have a deal. Next they go after the $400,000, then$300,000, $200,000, $100,000. Or perhaps when prices drop 20% then panic will set in and quickly fall another 20% to 30%. I have faith that one of these scenarios wll take place. I cannot rule out a possible 70% drop over 5 years but it is not going to be a depression.
I don’t know exactly why my teachers are against gold. That is why I knock it, to try and find out exactly why. I suppose you have to believe in end times to give it credability. O’leary explained why gold rose earlier this week, but I forgot them partly because he did not consider the reasons enough to get excited about.

#56 Franco Mazzuca on 09.16.10 at 5:17 am

The video sounds like a typical infomercial.

Tugs at all the emotional strings.

Greed, scaricity, act know because this opportunity will be gone soon.

I think a blog article on emotional selling is in order.

It will take time for prices to adjust. People are still not focusing on reality. But what is reality. Garth says that the fundamentals are out of whack but the market keeps acting differently. It takes conviction to hold out to the belief that we will revert to the statistical mean.

#57 Mike Turner on 09.16.10 at 5:59 am

“And as for CREA’s numbers, most media did not manage to include news that prices across Canada slipped again in August, and are now 6.3% below the peak hit in May. That’s 6.3% less in 90 days. Gulp.”

So if you went in with 5% down you’re now in negative equity. Double Gulp.

#58 David B on 09.16.10 at 6:07 am

And this morning polls puts Canada’s Greatest Prime Minister Ever on top in the polls proving taxing BC and Ontario and spending this countries children and grandchildren’s money wins votes and respect. The West is in so buy into the west lock stock and barrow, y’all can not loose. Western Real Eastate is a 100% sure winner just like it’s leader King Steve. Soon we all will have more taxation and our homes will double in value and all will be fine ……. Harper Economics 101 a winner for all seasons! Really?

#59 captlou on 09.16.10 at 6:08 am

Good luck for tonight. I wonder if Mr Muir will be found skulking around the corners?!

#60 bigrider on 09.16.10 at 6:14 am

Garth will tonights event be posted on youtube for the benefit of those in T.O et all who cannot attend ?

If not, will the recording be made available?

Would Lady Gaga do that? — Garth

#61 OnlyTheBankersLaugh on 09.16.10 at 6:31 am

Good luck tonight, Garth.

You’ve entered into fundamentalist territory where real estate is the religion.

It’s you against the media and entire real estate industry. The flea on their butt has just morphed into a small yet nasty dog. It’s still a tough climb from here as government, banks and realtors are a fairly slick group out there.

I suggest the 3124 Spectra… http://www51.honeywell.com/sm/afc/products-details/shield-details/Spectra-Shield.html?c=32

#62 Mike Turner on 09.16.10 at 7:02 am

Would Lady Gaga do that? — Garth

No but the Greatful Dead would.

#63 Brian on 09.16.10 at 7:07 am

April; I had only 7 comments up to 7.00 this morning in Toronto.

#64 Moneta on 09.16.10 at 7:10 am

People get sick of waiting.
———–
The 7-year itch isn’t a joke.

I went to my daughter’s grade 4 meet the creature evening. Not even half the parents showed up. This compares with grade 2 where both Moms and Dads showed up.

I guess parents run out of steam or just realize their kids is not Einstein.

Same thing with everything in life. Most people don’t know how to pace themselves and focus on what’s important in life.

#65 bigrider on 09.16.10 at 7:15 am

Garth-would lady Gaga do that

OK then Nov 9th in T.O. I’ll wait.

Is location known yet?

#66 Grandpa Grinch on 09.16.10 at 7:27 am

Wish I could attend the Vancouver event. Bet there will be a lot of ladies in the 60+ crowd whippin off the ole granny panties to throw on stage…..

I know that turns you on. — Garth

#67 Moneta on 09.16.10 at 7:49 am

Since we got 0 to 5% down payment mortgages out there, we know that it won’t take much to push many owners into negative equity territory.

Negative equity is the best predictor of foreclosure and plays a nasty role in the resale market. Why? Try selling your house and buying another with negative equity.

Whether homeowners with negative equity can sustain the payments or not will become irrelevant. The reality is that once negative equity starts to hit, sales will drop like a rock and sellers will be forced to take HUGE cuts. Then watch the snowball effect.

HELOCs will be called in and/or rates increased and force even more to sell making home prices drop even more. And all you’ll hear is the sound of money being sucked out of the markets and the econopmy.

Get your popcorn.

#68 T.O. Bubble Boy on 09.16.10 at 7:55 am

Would Lady Gaga do that? — Garth

whoa there — this seems to imply that you and Lady Gaga have the same standards for what you will and won’t do?

I hope you know how to iron a “meat dress”!

#69 T.O. Bubble Boy on 09.16.10 at 8:02 am

Given the level of integrity required to be a RE Association “economist” vs. a scalper, I wouldn’t be surprised if this ad was actually from Mr. Muir!

Although, I just noticed that this scalper got the website wrong (“thegreaterfool.ca” doesn’t exist)! I would think that RE public figures all have Garth bookmarked, so they would get this right.

#70 Tripp on 09.16.10 at 8:04 am

“Where residents think people would choose over
London, New York, Paris or San Fran.” – Garth

This reminds me of a reader’s letter in an Ottawa newspaper a couple of years ago stating that Sussex Drive is “our Champs-Élysées”. Quite a stretch…

For a comprehensive study regarding purchasing power check:

http://www.ubs.com/1/e/media_overview/media_global/releases.html?newsId=184058

#71 T.O. Bubble Boy on 09.16.10 at 8:08 am

Last post of the morning:

Listings are UP UP UP!

My usual realtor.ca search is now returning 2733 results… up from approximately 2350 at the end of August (+16.3% in 2 weeks).

Also, the YatterMatters daily stats for Vancouver must be concerning to Mr. Muir and friends:

Vancouver East & West
New Listings – 80
Back On Market Listings – 0
Price Changes -33
Sold Listings – 21

Vancouver All Areas
New Listings – 272
Back On Market Listings – 2
Price Changes – 131
Sold Listings – 63

A 4-to-1 new listings to sales ratio is not a good thing.

#72 Carruthers on 09.16.10 at 8:13 am

“There was CREA, for example, trumpeting the news that home sales across Canada rose by 4.1% in August from the previous month, the first increase in a year.”

Right. So a single data point is a trend to these people? I understand the media ankle-biters not understanding basic stats but CREA should know better? Ooops, rhetorical question.

A 4.1% increase is nothing but month-over-month statistical noise. See CREA’s own charts for a better perspective.

http://creastats.crea.ca/natl/

Telling as well is that CREA’s consumer confidence indicator from the Conference Board of Canada is in a downward trend. Hey, that supports a higher sales and price trend right?

#73 Consider This on 09.16.10 at 8:41 am

AT #36: And your comments are precisely why the Canadian system has been a complete farce and WILL fail. I do NOT disagree with you one bit. Understand that others, unfortunately, will be doing exactly what you stated. Therefore, banks are not responsible for their own lending standards, buyers don’t have to give a rat’s ass if it fails, and the taxpayers eat it all. Probably the worst system of any in the G20. Just wait and watch.

#74 Bill ( Peterborough) on 09.16.10 at 8:43 am

Re # 194 Soylent Green Is People

Thanks.

Witnessed myself how big business runs the show behind close doors. Regardless who you vote in they all cater to the same masters.

Corruption/politics have been join at the hip since both of their inceptions.

http://www.iamthewitness.com/books/Andrew.Carrington.Hitchcock/The.History.of.the.Money.Changers.htm

#75 prairie gal on 09.16.10 at 9:03 am

#4 Old_is_Gold on 09.15.10 at 9:46 pm
Does this post not prove the fact that the media are in bed with industry who are in bed with the the bankers who are in bed with the government and all out to fleece the very public they profess to serve.
——-

Old is Gold, you see maliciousness where there is only ignorance and a self-serving bias.

People who think there is an evil conspiracy lurking around every corner are merely projecting their own darkness onto others.

#76 Old_is_Gold on 09.16.10 at 9:09 am

Does this next leg of the RE collapse in the US a forewarning of systemic failure that was delayed back in 2008? Never say never in finance; there is nothing too big to fail, not even Uncle Sam.

15 Bone Chilling Signs That Part Two Of The Double Dip Housing Crash Has Begun – http://endoftheamericandream.com/archives/15-bone-chilling-signs-that-part-two-of-the-double-dip-housing-crash-has-begun

# 74 Bill (Peterborough)

“Corruption/politics have been join at the hip since both of their inceptions.”

Someone said that politics is the second oldest profession in the world. These guys (and gals) must sell their souls, whereas the ones in the oldest profession only have to sell their bodies.

#77 pezzazz on 09.16.10 at 9:17 am

Garth I want to see you crank it to “11” tonight!!!

#78 Sherri on 09.16.10 at 9:23 am

Garth: Right on RE. Wrong on Gold.

#79 Vic_guy on 09.16.10 at 9:29 am

Balanced news for Victoria in the mass media : http://m.youtube.com/#/watch?xl=xl_blazer&v=wwzX7gm2GPI

Year over year September sales are running at 25% of 2009.

#80 Soylent Green is People on 09.16.10 at 9:48 am

Is this thing on?

testing, testing

#81 Northern Dirt on 09.16.10 at 9:48 am

Do preferreds offer DRiP Plans? Or is that only available on Common Shares?

#82 Kenny on 09.16.10 at 9:56 am

RE: #36 AnotherLowlyRenter
>>But if I had no money, I could get a 95% mortgage, and if the market fell, the most I’d lose is my $40k.And if the bank came after me afterwards? I’d just declare bankruptcy and thank the taxpayers & the CMHC for taking care of it.

You brilliantly put into two sentences why emergency rates and government backed mortgages create bubbles. It’s like going to a casino and being allowed to bet more money than you have without any consequences if you lose.

#83 Tony on 09.16.10 at 9:59 am

#26 Taxpayer like everyone else

Interest rates peaked in the fall of 1987 in Canada. The real estate market also peaked around the same time the third week of September of 1987. Interest rates fell onward.

#84 Karlheinze = Mulroney on 09.16.10 at 9:59 am

Hm. I am struggling with your comment from yesterday “I have personally witnessed no corruption in politics. Bad judgment, of course. Expediency, naturally. But no malicious intent. Upon what do you base your beliefs, other than a movie? — Garth”

Saying that you personally witnessed no corruption is not the same thing as saying corruption does not exist. I get it that you served in government and all of us bloggers have not…but that doesn’t mean you’re the only person who gets to comment on whether corruption exists in government.

Are you telling me Mulroney was innocent? Envelopes of cash and “oops I forgot to pay tax on it”. One of the biggest and most blatant of his shenanigans. Still makes me throw up in my mouth all these years later.

Sheesh.

Throw up all you want, this was not corruption, and did not take place when he held office. BTW ever paid cash to a tradesguy? — Garth

#85 Zaza on 09.16.10 at 10:02 am

GTA REALTORS® Report Mid-Month Resale Housing Figures

September 16, 2010 — Greater Toronto REALTORS® reported 2,623 sales through the Multiple Listing Service® (MLS®) during the first two weeks of September 2010. This represented a 22 per cent decrease compared to the 3,361 sales recorded during the same period in 2009. Year-to-date sales amounted to 65,455, representing a six per cent increase compared to 2009.

#86 the commenter formerly known as... on 09.16.10 at 10:08 am

Hi Garth.

Signed up for the Surrey speak. Haven’t heard a thing. Is it full? Or do we just crash the place? lol

#87 Rock077 on 09.16.10 at 10:09 am

Garth, will you be stopping in Calgary anytime in the future?

#88 BrianT on 09.16.10 at 10:11 am

UBS ranks Toronto as the 8th most expensive city in the world http://www.thestar.com/business/article/861702–toronto-montreal-among-most-expensive-cities?bn=1

#89 David B on 09.16.10 at 10:13 am

Only in America eh!

Fr. the G&M

U.S. foreclosures up 25% over year

Yup …. ride em cowboys ….. buy one buy two homes now the West is in and King Steve is top cat world wide, He and Flaherty are just that smart eh keeping cheap money on the market. They just print it and Greater Fools spend it …. so what’s a tax increase anyway …just borrow more.

OMG …. it’s not eve funny anymore.

#90 AnotherLowlyRenter on 09.16.10 at 10:17 am

At #73 “consider this”
—-

It makes me very angry. Particularly with all the global press about how Canada’s banks are such incredible risk managers. Of course they are – they pass it forward.

It’s made me adopt a little of the ‘if you can’t beat ’em join them’ mantra. So I’ve picked up some bank stocks and REITs. That way I’m protected if the crazy bull market continues.

Of course I’m hoping that when it all cracks (and maybe it is cracking now), I’ll be nimble enough to get out before I lose any capital.

It’s a very fine line I’m walking. Because while I do believe that CDN banks are cushioned by the CMHC on res mortgages, they are still exposed to the economy on all other levels of lending. And if we do get a full-fledged property bear market, I would expect considerable downside to the economy and hence my bank stocks/REITs.

So thank you Flaherty & Carney for forcing me to seek out yield and chase your bull market.

#91 Bailing in BC on 09.16.10 at 10:18 am

#60 bigrider

Garth will tonights event be posted on youtube for the benefit of those in T.O et all who cannot attend ?

If not, will the recording be made available?

Would Lady Gaga do that? — Garth

No she would not Garth.

But she would however, appear on the front cover of a magazine, apparently naked, except for a handful of strategically place bubbles.

I for one would like to see you in a recreation of said magazine cover. I believe it would be tasteful and topical.

#92 Joe Q. on 09.16.10 at 10:25 am

Garth — TREB sales numbers for the first half of September came out today. Sales down 22% vs. the same period last year. Unfortunately, no listings or active inventory numbers were provided.

#93 dark sad person on 09.16.10 at 10:31 am

#75 prairie gal on 09.16.10 at 9:03 am

People who think there is an evil conspiracy lurking around every corner are merely projecting their own darkness onto others.

************************

Why do you see only black or white?
Why does the word conspiracy have to be brought into this?
There is no conspiracy-they robbed us and our kids-in broad daylight-
Do you think the transfer of wealth from us-to the bankers via CMHC/FNM/TARP/Level 3 was just some sort of innocent-whocouldanode blunder?

#94 canadian on 09.16.10 at 10:33 am

Guys watch the price of gold, if it maintains this level or shoots up from here, something big is in the pipeline regarding equity markets soon.

that something is not good.

Gold is a great barometer of what the “smart money” crowd knows or perceives to happen. Im not pushing gold but the recent uptick has we somewhat cautious about the coming 2-4 weeks, if it breaks $1300, im going to go short on the markets.

#95 Joe Larue on 09.16.10 at 10:41 am

It has been said that the truth goes through 3 stages. In the first stage, it is ridiculed, in the second, it is resisted and fought, and in the third stage, the truth is accepted as always having been common wisdom.

#96 Dave in Victoria on 09.16.10 at 10:44 am

#8 april on 09.15.10 at 10:05 pm

I use a Mac, and have had no problems…

Maybe Michael Levy will make a surprise appearance tonight, and he can tell everyone how the economy is fine a Asia will save us.

#97 fancy_pants on 09.16.10 at 10:45 am

why doesn’t the media just bend over and blow some sunshine? – it requires less hot air with the same effect. get me a shovel and a fan please.

#98 Dan on 09.16.10 at 10:45 am

AnotherLowlyRenter “I joke with my girlfriend that I wish I had no money. If I had no money I’d buy a house in a heart beat.

That’s because if I buy an $800k house today and the market corrects 30% – then I’m out $240k.

But if I had no money, I could get a 95% mortgage, and if the market fell, the most I’d lose is my $40k.And if the bank came after me afterwards? I’d just declare bankruptcy and thank the taxpayers & the CMHC for taking care of it.”

Like you I have alot of money to lose by buying an overvauled house where people with NO MONEY can go and buy with little to no down and go bankrupt if things go bad. My plan B is to hide the money and then borrow borrow borrow until I go bankrupt and then leave Canada in financial ruin. I have skills which i can take to the US where I can buy a home for pennies on the dollar. The only thing stopping me now is family. If this crazy housing ponzi continues then it would be time to steal as much as I can and then leave Canada. What kind of a stupid country allows people with NO MONEY to out bid other people who have money? NO MONEY is out bidding people with money! Canada has the biggest housing ponzi in the world and it’s backed by the government , media and other self interest groups. Keep it up BoC and CHMC I am thinking of a way to go BANKRUPT. I dream of the day you need 25% down and 10% interst rates. That would sure drop home prices back down to 2-3 times income. In the US people with NO MONEY just walked away while people who put 25% lost everything. I remember peter shiff was telling buyers NOT TO PUT ANY money down(if they wanted to buy) back in 2006 since he said they would lose their downpayment and I think we are at the same situation here but worse. Sorry long rant.

#99 Bill ( Peterborough) on 09.16.10 at 10:48 am

# 76 Old_is_Gold

Interesting, informative, as usual.

Personally I cannot see any real recovery for a very long time over here. We will have the typical dog and pony show thrown at us by our governments, by way of more money thrown into stimulus’. Only benefitting the larger corporations, not smaller business’/ blue collar workers.

Further forcing the middle class into oblivion through taxation, under the pretence of trying to pay down a deficit, which has been orchestrated to never be payed off in the first place.

We can thank the vipers who run the Banking Cabals, along with their master for this, as well as the political weasals who sold us out , while lining their pockets .

Next steps will be pre-planned wars, more engineered famines, man made plagues, to down size the global population. Lock up the free thinkers/protesters under this new ‘Patriot Act”, with their final push of trying to bring in the NWO. ( Rmember the slogan “Order out of Chaos” )

Alot of people will disagree, however; if you read your history it’s always been the same game from get go. Just with different variations.

But it is written so. We cannot change the outcome. At the same token I will not be anybodies fool.

#100 Nemesis on 09.16.10 at 10:48 am

“Would Lady Gaga do that?” — Garth

http://tinyurl.com/3xhcnqd

;)

#101 TGS on 09.16.10 at 11:12 am

US home seizures reach record level for third time in five months…..

http://www.bloomberg.com/news/2010-09-16/bank-seizures-of-u-s-homes-reach-record-for-the-third-time-in-five-months.html

#102 F on 09.16.10 at 11:20 am

Ottawa plans three new measures to bolster economy
I hope one is not a measure to bolster housing. Garth, what do you think the odds are that there will be something regarding housing in here?

Read more: http://www.financialpost.com/news/Ottawa+plans+three+measures+bolster+economy/3533560/story.html#ixzz0zi0pUHeY

A chart showing Canadian housing is 79K above it’s long term trend.

http://www.ritholtz.com/blog/wp-content/uploads/2010/09/UUAC-Home-Price-Family-Income-Ratio.png

Toronto Mid-month figures out. Sales down 22% YOY, prices up 5% YOY.

http://www.torontorealestateboard.com/consumer_info/market_news/index.htm

#103 tjmikey on 09.16.10 at 11:24 am

#11 Echo

I would NEVER choose Vancouver over San Fran.

The reason…..the coming economy, never forget that regardless of the location within Canada we are the USA’s Bitch and it is only going to get worse.

I firmly believe that the USA is going to force Canada back to being a 100% supplier of raw material and bit by bit further devastate what is left of our mafg sector.

We are just starting on our way down and they are ALMOST coming back up for air.

The USA will let every other nation in the world go down before them….given the chance I would be in the States conducting biz in a nano-second.

#104 garthfan on 09.16.10 at 11:28 am

Isn’t tin foil is just another name for dissident?

A good conspiracy read, is Mr. Noam Chomsky’s Hegemony or Survival . What he writes about the Cuban Missile Crisis from documents declassified in 2003 is truly disturbing. I know when I got to that part, I had to walk over and hug my kids in a life-affirming sort of way. That guy is a rock star for sure.

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

#105 Patz on 09.16.10 at 11:38 am

If you’re a regular on this site you’ve already taken enough steps to realize that it ain’t all peaches and cream in the Great White North, and not even so in the Lotus Land subdivision, aka B.C. And further since this post you know the gummint and MSM lies—Hell, I know you knew that before.

But all of this is just symptoms. What’s really going on is the unsteady platform of energy availability now and in the near future—really near.

It is well past time to educate yourself on this. A good place to start is here: http://tiny.cc/yl7d0

That’s an interview with Bob Hirsch. Look him up on Wikipedia; he’s a highly regarded energy expert and consultant who has done work for the U.S. Dept of Energy among others. He paints a frightening picture of the likely dystopia we’re headed for in 2 to 5 years.

The toughest conceptual leap anyone in the world today has to make is to realize that it is never going to be the way it was. Jobs aren’t coming back; mass poverty is on the agenda and political turmoil will follow as sure as God made little green apples—well I’m not actually sure he did that, so more sure!!!

#106 T2 on 09.16.10 at 11:44 am

Dear Garth, thank you for shedding light on what the “Real” state (cheesy I know, couldn’t resist) of the Canadian real estate market is. I would like to ask one thing of you though, could you please keep quiet until my home in B.C. sells, you’re scarring off the greater fools!

#107 CrowdedElevatorfartz on 09.16.10 at 12:09 pm

#4 Old_is_Gold
I somewhat agree with your statement that the media, politicians and corporations are in bed together.
However I dont think that it is a conscious conspiracy.
The Corporations donate huge scads of money to political parties to push their corperate agenda. They also spend huge amounts of money in the media for advertising.
Thanks to the”new media” a la “The Internet” Public cynisism is at an all time high for Politics( anyone notice how many “minority” govts there are world wide). The media( tv, newspaper, radio are all losing their audiences). And , last but not least, Corporations,
Yes , Corporations, Big Business, How we love to hate thee. As millions of people are forced to sit though another HR “employee engagement seminar” at work that reminders you how valuable you are to the company, Head office wacks another 50 jobs. Drink the Kool Aid and everything will be better.

The Majority have Zero trust for ANY of these organizations. When they all spiral down into insolvancy, the rats that run them will scurry to the next best job.
The next 5-10 years will be very interesting

#108 Property Virgin Apprentice on 09.16.10 at 12:14 pm

I like how the realtors are creating panic amongst buyers to get them off of the fence. Buy, buy or bye, bye!!!

#109 Herb on 09.16.10 at 12:18 pm

Nemesis @ #101,

thanks for the link to Lady Gaga.

Don’t try it, Garth, unles you can get the same drill instructor.

#110 The Original Dave on 09.16.10 at 12:26 pm

Guys watch the price of gold, if it maintains this level or shoots up from here, something big is in the pipeline regarding equity markets soon.

that something is not good.

Gold is a great barometer of what the “smart money” crowd knows or perceives to happen. Im not pushing gold but the recent uptick has we somewhat cautious about the coming 2-4 weeks, if it breaks $1300, im going to go short on the markets.
—————————————————–

wrong bet, but have fun with that. Just because gold is rising, doesn’t mean other assets can’t. It could be a simple indication of what’s happening in the credit markets. Loose credit and there’s buying everywhere – including gold.

Maybe you should consider using commodity price ratios to determine what’s happening with credit markets.

#111 Bill ( Peterborough) on 09.16.10 at 12:29 pm

Re #94 dark sad person

Why do you see only black or white?
Why does the word conspiracy have to be brought into this?
There is no conspiracy-they robbed us and our kids-in broad daylight-
Do you think the transfer of wealth from us-to the bankers via CMHC/FNM/TARP/Level 3 was just some sort of innocent-whocouldanode blunder?
——————————————————————-

Interestly correct; ( many roads to MECA)

Here’s a different spin, getting to the same result:

They conspired to rewrite the laws so as to legally rob us and our kids , in broad daylight.

Therefore being able to sleep at night knowing they did not break the law.

Job Classifieds: political position available.

Looking to enter political field, apply within. Morals and principles frowned upon.

Unfortunatley justice and the law are no longer the same in alot of circumstances.

http://www.youtube.com/watch?v=Y4y7qzuQ2H4&feature=fvsr

#112 Calgary Rip Off on 09.16.10 at 12:32 pm

Yawn. The latest from the Herald. http://www.calgaryherald.com/business/real-estate/Calgary+sales+third+highest+drop+country/3529421/story.html

Houses are still PRICED DOUBLE their real values.

#113 char on 09.16.10 at 12:39 pm

Yes, it’s sarcasm.

http://globaleconomicanalysis.blogspot.com/2010/09/canadian-banks-are-more-prudent-on.html

#114 Kevin in Winnipeg on 09.16.10 at 12:40 pm

“- MODERATION IS A GOOD THING – – – August MLS® Active Listings Up 4%; Sales Down 12%”, WinnipegREALTORS

http://www.winnipegrealtors.ca/press/sept10pr/sept10pr.pdf

If a real corporation came out with this type of report, their stock would plummet. People are delusional, even in moderate Winnipeg.

#115 CrowdedElevatorfartz on 09.16.10 at 12:44 pm

#169 Rory (yesterday)
Hmmmmmm Because Im “anti nuclear” I must automatically support Wind and Solar. There’s a jump.
I never though wind power was realistic ( too unpredictable). Solar is still a bit too expensive but it’s getting there.
There’s a new invention called Hydro been around in one form or another for 1000’s of years(Grist Mills).
Also this weeks Economist has a multipage article on Thermal energy ( look down at your feet, unlimited power down there.) Cost a bit to tap it but I truly think it will be the Green Energy that takes hold.
Nuclear Power? Never. Too expensive, too toxic, too much waste.
I live in BC. If you want it in your back yard, go for it.

#116 GrimWeeper on 09.16.10 at 12:58 pm

Here’s a Calgary Coach Hill home that’s just been reduced from $975,000. to $915,000. Heard the owners are a long-time real estate sales couple who’ve chosen to list their property with a fellow traveller. Are three real estate bubble heads better than none?

http://www.bobnobes.com/data/remax/realtors/bnobes/agentlist.asp?Source=CREB&Rltr=CNOBESRO&win=0

#117 Sultan on 09.16.10 at 1:01 pm

Any one who plans to attend today’s event at Vancouver (whether you are registered or not) should know that the doors will open at 6.15 pm and will close at 6.45 pm so better get there early to get in..

That’s news to me. — Garth

#118 TheBigLebowski on 09.16.10 at 1:09 pm

.#112 Bill ( Peterborough)
Being able to sleep at night is not a problem for most high level politicians, since the majority of them actually have sociopathic personalities. I don’t mean like Jeffrey Dahmer-type profiles. I mean the can be caught red handed in the middle of a massive scandal and feel absolutely no remorse or guilt. They can stand in front of media and actually lie with no anxious feelings about it. They are unable to feel empathy or remorse. These are the types of personalities that sniff the wind like rats and suck their way to positions of power. A control freak sociopathic personality with no scruples is what it takes to make it to the top in this profession. For Garth to say he has never seen corruption in politics is baffling. I guess two staged world wars and the invasion of the middle east doesn’t count among dozens of other events.

#119 R on 09.16.10 at 1:09 pm

# 99 Dan…Excellent..If there was a prize for best comment of the day….You would win……

#120 dark sad person on 09.16.10 at 1:14 pm

#112 Bill ( Peterborough) on 09.16.10 at 12:29 pm

Interestly correct; ( many roads to MECA)

Here’s a different spin, getting to the same result:

They conspired to rewrite the laws so as to legally rob us and our kids , in broad daylight.

***************

yep-
and that came into being-because people screamed for more government “protection” and cheered-as more power was granted-to these imbeciles

f-kemall

************
Meanwhile-the brilliant Austrian and daily asskicker of all hyper-inflationists-
makes a call–on this very subject–

************

Thursday, September 16, 2010

Canadian Banks are More Prudent on Mortgage Lending than US Banks; I Can Prove It

Canadian reader Vince sent me a tongue-in-cheek email: “When it comes to lending, we are much more prudent than you Americans”.

Vince offered this CIBC Up to 7% Cash Back Offer advertisement as proof.

CIBC Up to 7% Cash Back Offer could be for you if you:

* Want to renovate, furnish or decorate your home
* Would like to take a dream vacation
* Want to prepare for any unexpected moving expenses
* Want to make an additional lump sum payment on your mortgage
* Need money for a special upcoming event such as an anniversary, wedding or child on the way
* Want to renew an existing mortgage early, or transfer your mortgage from another financial institution and have prepayment costs to pay
* Want to purchase investments, open an RESP or make an RRSP contribution

CIBC Up to 7% Cash Back Offer Key Benefits:

* You get up to 7% cash back based on your mortgage amount and term1, to spend however you choose
* This cash back amount is completely tax-free **
* There are no cash maximums – the larger your mortgage, the more cash back you receive

What the hell can possibly go wrong with that?

* For CIBC, not much, at least that I can tell right now. The reason is the Canadian Central Bank is on the hook if the buyer defaults.
* For the idiots who pay too much, take cash out and blow it on a vacation in the Bahamas, quite a bit.
* For the innocent bystanders unwilling to pay bubble prices, content on the sidelines until they have to bail out the above idiots with tax hikes or debased currency, also quite a bit.

On the whole, this looks pretty prudent to me, for CIBC, not for anyone else, until of course the whole mess blows sky high and most lending screeches to a halt with defaults running rampant.

In the meantime, party on CIBC executives. Just remember to take your bonuses for huge profits in cash, not shares. It’s the American way.

Mike “Mish” Shedlock

http://globaleconomicanalysis.blogspot.com/2010/09/canadian-banks-are-more-prudent-on.html

****************

while you’re waiting for a bite-

http://www.youtube.com/watch?v=HIil8k5QnFU

#121 T.O. Bubble Boy on 09.16.10 at 1:20 pm

On those GTA mid-month numbers:

September 2009 had a total of 8035 sales, with 3361 at the mid-month mark.

September 2010 has 2623 mid-month, which would be 6271 for the full month…

Since 2004, the lowest September sales total was 6424 in 2008… so 2010 would be the worst September in at least 6 years.

Gee – I wonder if that will make it into the press releases?

(answer: no, they will focus on the month-over-month stats and/or the year-to-date stats)

#122 grantmi on 09.16.10 at 1:21 pm

Garth..

how come you’re not on the Bill Good Show today or tomorrow.

He had his resident cheerleader, Michael Levey on today…

the Skies are not falling folks.

“I spoke to two real estate agents this week… and they say BUY, BUY, BUY!!!!!!!”

Baaaaahhhhhhhhh!!!!

#123 Grandpa Grinch on 09.16.10 at 1:29 pm

From David Rosenberg’s “Breakfast w. Dave”

Another reality note comes down to the housing market — denial on what a house is supposed to accomplish in our lives is giving way to acknowledgment that it is really only a place to live. It is not an investment. A new survey by Fannie Mae (see page A4 of the FT) showed that:

The share of the public who believe housing is a “safe” investment has declined to 67% from 83% as the boom was turning to bubble (but before it turned to rubble) in 2003.

Even though 70% believe home prices will soon bottom out, the share of households who say they would rather rent than buy rose to 33% from 30% at the beginning of this year. This attests to the aversion to take on debt … the fabled liquidity trap.

More than 50% of renters do not believe they would be eligible for a mortgage (maybe this is why mortgage purchase applications have plunged 40% in the past year).
• Fully 20% of renters say they have decided to delay whatever home purchase plan they previously believed they would undertake.

Based on these results, it would be foolhardy to be looking for a revival in home sales any time soon. With so much excess inventory, a renewed down-leg in home prices cannot be that far down the road.

#124 dradak1 on 09.16.10 at 1:33 pm

#84 Karlheinze = Mulroney on 09.16.10 at 9:59 am

“Throw up all you want, this was not corruption, and did not take place when he held office. BTW ever paid cash to a tradesguy? — Garth”

Garth – are you trying to say that Mulroney become unethical just few days before he left the office. ?!?

#125 Crash Callaway on 09.16.10 at 1:37 pm

Wifey and I were shown a couple of properties by
Ms. Newhouse who appeared to be overeager to sell us a property.
A few days passed and we gave our heads a shake and decided buying a house now was equivalent to suicide.
The realtor however had other ideas and it got to the point where her phone calls bordered on harassment.

As I answered the phone one evening trying to conceal the fear on my face, the wife shouted over at me:
“Is that Hortense?”

Well… I said: “she does sound a little edgy”

#126 Evangeline on 09.16.10 at 1:50 pm

#8
I’m not having any problems with the site … everything is displaying as it always has. Sounds to me like you might need to refresh your cache.

#127 Bill ( Peterborough) on 09.16.10 at 2:09 pm

Re # 77 Old_is_ Gold

#60 Bill ( Peterborough) – You are very well informed and are not afraid to connect the dots, but it appears that most of the readers here have different goals. If you are in Peterborough, please send me an e-mail from my link and we can have a chat sometimes about the Jesuits, Vatican etc. I ride up towards Lindsay / Peterborough from time to time and always look forward to speaking to the rare person who gets the bigger picture.

——————————————————————-

Please forgive my persistance. Yesterday I asked you if Old is Gold / deshpal sandhu are the same . ( why would a man of God have 2 monikers. ( Curious)

No reply as of yet.

Checked your site/ ministry. Found no physical address or phone numbers, just how to get of you through rogers e-mail….

Did all kinds of other searches, still cannot find out enough.

Yet you except donations for your ministry.

I usually have a pretty good idea when I been basted up.

I sort of have the mentality of a bull dogge. Once I’m on top something I usually don’t let go till it smells/ looks right to me.

Greatly appreciated if you could enlighten me.

#128 Cynical on 09.16.10 at 2:27 pm

And here’s some more gasoline for the fire!

CIBC Up to 7% Cash Back Offer: https://www.cibc.com/ca/mortgages/article-tools/up-to-7prct-csh-bck.html

And here’s Mish’s take on said “offer”: http://globaleconomicanalysis.blogspot.com/2010/09/canadian-banks-are-more-prudent-on.html

More “risk free” financing for us taxpayers to guarantee. :(

#129 Herbie on 09.16.10 at 2:31 pm

I will second the query on Calgary, any plans to speak in our fair city??

#130 bruce corell on 09.16.10 at 2:32 pm

Sorry to say September sales (1st 2 weeks) are down 22% from Last year. Also down 20% from August which is terrible. We are looking a correction of biblical proportions….Hold onto your hats or houses becuse its ugly……

#131 Moneta on 09.16.10 at 2:32 pm

What kind of a stupid country allows people with NO MONEY to out bid other people who have money? NO MONEY is out bidding people with money!
—————–
Funny how people WITH MONEY weren’t complaining when markets were returning 10%+

NO MONEY = WITH MONEY = GREEDY = FUBAR

#132 goldenfox on 09.16.10 at 2:34 pm

Speaking of Mulroney. It is speculated that Barrick gold was originally setup as a device to launder gold into the market to manipulate the price down. Interesting JP Morgan is a majority shareholder. Mulroney & the elder Bush sit on the board of directors. What do they know about mining?

#133 Old_is_Gold on 09.16.10 at 2:48 pm

#108 CrowdedElevatorfartz

However I dont think that it is a conscious conspiracy.
The Corporations donate huge scads of money to political parties to push their corperate agenda. They also spend huge amounts of money in the media for advertising.

I think what your are describing above would perfectly fit the definition of a conspiracy. The corporations through their donations buy government and media; I am sure no one donates a million dollars or even a 100K or even 10K for a black tie dinner unconsciously. It is a deliberate conscious decision to invest money to buy favors, favorable legislation from the politicians and favorable press from the media. The politicians are not unaware of what they are doing. And neither are editors who consciously choose to run fraudulent stories. Whenever money is changing hands, throw all altruisms out the window, it is a pure and simple business transaction, made very consciously.

It is high time that people stop giving these people a free pass by accepting the lame excuse that they don’t know what they’re doing. They know exactly what they do. I am not a GB Shaw fan but he summed it up rather well in this quote:

“As people get their opinions so largely from the newspapers they read, the corruption of the schools would not matter so much if the Press were free. But the Press is not free. As it costs at least a quarter of a million of money to establish a daily newspaper in London, the newspapers are owned by rich men. And they depend on the advertisements of other rich men. Editors and journalists who express opinions in print that are opposed to the interests of the rich are dismissed and replaced by subservient ones.”

– George Bernard Shaw, The Intelligent Woman’s Guide to Socialism, Capitalism, Sovietism and Fascism (1949)

#134 Dodged-A-Bullit-in Alberta on 09.16.10 at 2:59 pm

Greetings: “BTW,ever paid cash to a tradesguy:- Garth

I have held a number of elected positions where I had access to and spent other peoples’ money. One of the reasons politicians are held in such low esteem, is that they like to forget the phrase “other peoples’ money”. Many do not seem to realize that they are held to a higher standard of conduct by reason of their elected position as a paid employee of the Canadian public. It matters not if they actually break any law, the end result is the same, credibility, trust, is lost and society suffers. I may pay a tradesman under the table, but if so, I use my own money, huge difference!!!

#135 jess on 09.16.10 at 3:01 pm

How to make an informed educated decision.
Case Study: How Open data saved Canada $3.2 Billion
14 April 2010 | David Eaves | 9 Comments
charity tax fraud
http://eaves.ca/2010/04/14/case-study-open-data-and-the-public-purse/
=
TARP is set to expire Oct. 3.
Dodd-Frank Act signed in July reduced to $475 billion.

7.1 million homeowners received a foreclosure notice, home prices have dropped 28% from its pre-crisis peak, and stock indices have fallen 30%, according to COP, a panel designed by Congress to oversee the spending and determine its effect on the crisis.

=
Contol Fraud
The Two Documents Everyone Should Read to Better Understand the Crisis
William K. BlackAssoc. Professor, Univ. of Missouri, Kansas City; Sr. regulator during S&L debacle
Posted: February 25, 2009 10:31 AM
http://www.huffingtonpost.com/william-k-black/the-two-documents-everyon_b_169813.html

http://www.nakedcapitalism.com/2010/08/nyt-muffs-merrillmagnetar-piece-and-why-is-no-one-investigating-the-related-bonus-fraud.html

#136 Wes Masterson on 09.16.10 at 3:13 pm

Craigslist, possible publicity stunt?

It’s quite a weak example of what Garth is trying to point out about the population of Vancouver. I expected a little more. That is, if it wasn’t Garth himself that posted it. In that case, good promotion work Garth.

Wes

#137 Bottoms_Up on 09.16.10 at 3:42 pm

#117 Mister Obvious:

Pardon me for laughing out loud but that sounds a lot like the BS my Dad used to make up about how destitute his family was as a child. The poor fellow had to walk 5 miles to school in a blizzard every day. Uphill, both ways. All they could afford for breakfast was a bowl of steam.
——————————————————–
Well, you’ve got a lot to learn. There are many people that are suffering out there, and many that are making due with less.

To add to my ‘Christmas tree story’ (which is true by the way), there was a time when the only food my family had in the house was a can of beans, and it was a fabulous week when my parents had extra money to buy a 6-pack.

Imagine living in a run-down apartment in Mississauga, having to feed your children, and only having a single can of food in the house? Or crying at the sight of 6 beers?

Anyway, life got better because my boomer parents worked their butts off, and now I would consider them upper middle class, and their 3 university-educated sons are definitely middle class.

But the stories of my childhood are true. And my experiences have made me a better person, and I would not change them for the world.

#138 Dan of the sound on 09.16.10 at 3:59 pm

#81 Northern Dirt

Some preferred issuers allow you to reinvest dividends into commons (at a discount) via a DRIP. See http://www.prefblog.com/?cat=39

#139 Timing is Everything on 09.16.10 at 4:02 pm

Garth, I guess your in Vancouver for a good time, not a long time….So have a good time, the sun can’t shine everyday. ;)

http://www.youtube.com/watch?v=ywfiwSaJwKo

#140 Dawn in Calgary on 09.16.10 at 4:30 pm

New ad all over the Calgary Herald’s online site

Invest in RE in Fort Mac! up to 17.5% return! Sign me up!

http://fort.lucidgroupofcompanies.com/index.php/site/investment/

#141 Foggy on 09.16.10 at 4:53 pm

At 26 taxpayer re 1989 house peak:

I guess I’m too Toronto-centric. The previous peak in the GTA was a big run-up in prices from 85–>July 89. Then a straight down decline, bottoming out in 96. Then the crawl up to where we are today. I don’t have Vancouver stats, but that would be pretty odd that they would be increasing from 89–>94 while the rest of the country was declining.

#142 Hovering on 09.16.10 at 4:55 pm

I love all you gold bugs

“gold at all time high” !!

people running around claiming “money isn’t money”

tinfoil hats etc..

Ha !

dbl short gold.

DZZ is the stock symbol for one of them

nutbars..

#143 dark sad person on 09.16.10 at 5:47 pm

Gotta love those Icelandic Vikings–
Wish we had more of them in Canada-
People who can see through the spoon-fed MSM BS–
People who do not believe-that their Politicians had no malicious or self enriching intent-when they allowed Bankers to set up a Ponzi scheme and in the end-destroy the economy–

These fiercely brave people do not swallow MSM BS and roll over and watch their kids future-being turned into a lifetime of debt slavery–like Canadians do-

H-F-C–are you paying attention?

***********************

france24.com
12 September 2010

AFP – Iceland’s former prime minister Geir Haarde and three ministers should be tried for negligence that led to the country’s 2008 banking and financial meltdown, a parliamentary commission said Saturday.

The ad hoc Special Investigation Commission (SIC) blamed extreme negligence of the former conservative government for the fall of three Icelandic banks in October 2008 that led the country’s unprecedented financial crisis.

Its findings confirmed the preliminary findings of its “Truth Report” released in April.

In a 274-page report published Saturday, the SIC said Haarde, former finance minister Arni M. Mathiessen, ex-commerce minister Bjoergvin G. Sigurdsson and former foreign minister Solrun Gisladottir should face trial.

The commission was set up by lawmakers at the end of 2008, shortly after Iceland’s three major banks went bust, dragging down its once-booming financial sector and sending the Icelandic krona plunging.

The commission’s report said the former ministers “showed themselves to be negligent” and said they should be “tried and punished by the Landsdomur” court. Read more…

http://info-wars.org/2010/09/13/icelands-former-pm-should-be-tried-for-2008-banking-collapse-parliamentary-report/

#144 jess on 09.16.10 at 5:54 pm

300 Economists Warn Obama: Grave Danger Ahead » New Deal 2.016 Sep 2010 … Three hundred economists released a letter to President Obama today with one message: focus on jobs, not on the deficit.
http://www.newdeal20.org/…/300-economists-warn-obama-grave-danger-ahead-20341/ – United States

#145 Sam on 09.16.10 at 5:56 pm

iTulip’s still going strong.

Eric originally kept me out of the bubble in late 1999, when I was DYING to get in, and later other members on the boards kept me out of real estate.

Eric re-activated iTulip as a discussion/forum/news site in late 2005. I’ve been a posting member since 2006.
_________________________
#36 AnotherLowlyRenter on 09.15.10 at 11:33 pm

Spot-on and made me laugh.

Back during the internet bubble, itulip.com helped me keep my sanity. Nowadays, your blog is one of my first stops. I even read the comments.

#146 4SlicesofCheese on 09.16.10 at 6:06 pm

Hey Garth,

Are there any plans to tape any of the talks and release them online? Even audio would be greatly appreciated.

#147 Nostradamus Le Mad Vlad on 09.16.10 at 6:24 pm

#8 april — I don’t seem to be having any trouble.

#10 Coho — “. . . Canada and other western countries are riding a course from 1rst world to 2nd world status.”

Along with #100 Bill (Peterborough)’s comments, that is very accurate.

#95 canadian — Good point. If gold does shoot three to five g’s north, equities tank big time, that will be the time to unload the metals and move back into the markets.

#100 Bill (Peterborough) — “. . . under the pretence of trying to pay down a deficit, which has been orchestrated to never be payed off in the first place. . . . pre-planned wars, more engineered famines, man made plagues, to down size the global population.”

Nicely summed up, Bill and a Merry Easter to you and yours! (That’s if we’re still here!).

Global Warming / Cooling. It’s still cool here, but whadda I know?

#148 X on 09.16.10 at 6:46 pm

re #81 – only able to drip common shares.

#149 Calgary Rip Off on 09.16.10 at 6:52 pm

In Calgary….

Pop! What was that?

No money?

No equity? On mac and cheese?

Buyer beware?

Yes. All of the above and more.

#150 Old_is_Gold on 09.16.10 at 6:53 pm

#121 Bill (Peterborough) Please forgive my persistance. Yesterday I asked you if Old is Gold / deshpal sandhu are the same . ( why would a man of God have 2 monikers. ( Curious)

Sorry Bill, I must have missed your request yesterday. I generally skim through the comments but do not read all of them everyday.

Old_Is_Gold / Deshpal (Paul) Sandhu are one and the same. The reason I changed my ‘moniker’ was that Garth was rather disturbed by my stance on conspiracy and gold a few posts ago and basically told me to take a hike when I was commenting as Paul Sandhu.

Since I enjoy the site (being that there is no other really Canadian site that deals with Canadian issues), I decided to change my moniker tongue in cheek to Old_Is_Gold. (I’m not that young anymore but hopefully wiser as a result of my experiences.)

I run my websites not for profit, if someone feels it worthwhile and wants to help I receive it with thanksgiving. If filthy lucre was my goal I would be on Benny Hinn or have a nice big church with lots of ‘members’ tithing faithfully, and I would bless their tithes so that they would receive a hundredfold. If you want to know what I think of these ‘men of god’ read the 100 fold return articles on my website

I also have dozens of radio shows that archived on there, listen to as many as you please and see if I ask for money or donations even once. So if you think that my intention was to fleece you in some way, I am truly sorry to hear that. On this blog, other than yourself there are a handful of people like Nostradamus Le Mad Vlad and dark sad person that actually lay the axe to the root beyond the subject of the price of real estate.

Being that you may be in my neck of the woods, I was just desirous of speaking to someone who actually gets it, a rare breed indeed.

I have a short bio on myself on my sites, I am no expert, have no church or ministry per se, neither do I desire to set up shop somewhere, thus do not feel the need to share my home address or phone # on the sites. Anyone that communicates with me by e-mail I respond to, and have developed a friendship with many across the world, mostly in the US and a very few in the GTA. I hope I have answered your questions and whether we meet or not I enjoy reading your insights.

#151 tjmikey on 09.16.10 at 6:55 pm

#131 Bottom up

My Mom told me a story a long time ago that I never thought was true. She grew up in Winnipeg (Saint Bonafice) during tough times….the kids were full of glee when Santa left them coal in their stockings because they would have some heat.

It’s true.

#152 WatchedBubbleNeverPops on 09.16.10 at 6:58 pm

Individuals paying $250 for nothing make me laugh – especially when they’re complaining about other individuals overpaying for other things.

#153 Onemorething on 09.16.10 at 7:09 pm

#99…Dan…smart Canadians have sold. Smart Canadians are looking to leave family obligations or not.

Only AUS can rival our country!

I left Canada 10 years ago pre high tech bubble. The problem is credit expansion over the last 30 years has property overvalued everywhere, so renting and putting away the extra is the best option ever!

And be ready for the eventual affordable home you speak of with tight credit conditions down the road.

#154 Northern_dirt on 09.16.10 at 7:25 pm

#132 Dan of the sound

I see they purchase common shares though for you in their drips.

Im already dripping a lot of these companies, just wanted to know if preferred’s would purchase more preferred’s.

No biggie, Ill just buy a whack of them, and personally reinvest the dividends.

#155 DaBull on 09.16.10 at 7:39 pm

#122 Cynical

More “risk free” financing for us taxpayers to guarantee. :(

Where the hell does it say that only CMHC insured mortgage holders need apply. Jeeze, quit assuming.

For starters, to get this you have to take the posted rate of CIBC posted 6.6% for 10 years.

These products are really geared toward the fixed term mortgage re-newel financial simpletons that don’t know it’s actually just a loan of $7,000 per $100,000 mortgage amount at 6.6% for 10 years. The CMHC insured crowd is not the intended audience, hence the disclaimer*

* Applicants must meet standard lending criteria.

Phone them and ask them what this means.

#156 Off the Leash on 09.16.10 at 7:41 pm

“All we really know for sure right now is that there appears to be a bubble building in the amount of commentators available to talk about bubbles.”

http://tinyurl.com/2cmph5b

Garth is mentioned

#157 ralph on 09.16.10 at 7:46 pm

Looks like the gremlins are at work again. The comments section won’t load. Only shows first five comments.

#158 Nostradamus Le Mad Vlad on 09.16.10 at 7:47 pm


#153 Onemorething — Good to see you here again!

If accurate, this would be a pre-cursor to another ice age, with the sun drifting away and sunspots (which is the engine behind CC) taking a time-out. Plus Junk science.

Poverty Headline and chart shows the true story.

The First of many? Vaccinations suck and hardly ever work.

9:29 clip What could we do with nearly $5 T of free money?

The US is using the controlled m$m to up the anti against Huge Chavez and Venezuela. This is one of the reasons why. More wars — aren’t we lucky!

The US$6 Tr. Pension Grab. Well Clinton looted a very healthy SS system to pay the deficit down, and people are losing retirement nest-eggs, to be replaced by US T-Bills which will almost certainly be worthless. SS Here. “The last official act of any government is to loot the nation!” wrh.com.

7:03 clip Gold — The next bubble to burst? No, not yet. Vested interests, you know (Soros)!

Blue Collar workers beginning to get really angry, which is what the elite want — sheeple fighting among themselves. Europe too. Massive unemployment?

Is the UK a third-world country? That’s the way the west (including us) is headed.

#159 ralph on 09.16.10 at 7:53 pm

I jumped the gun. All the comments loaded now. Sorry for the false alarm.

#160 Gord In Vancouver on 09.16.10 at 8:14 pm

Enjoy your stay in Vancouver, Garth.

If you can, please video tape one of your Vancouver shows and post it on Youtube. The sight of a Vancouver real estate bull desperately trying to defend his recent purchase will be priceless.

No one should be surprised that a Vancouverite tried to scalp tickets to one of Garth’s shows. Vancouver is an expensive city to live in but offers, at best, average salaries. Locals are; therefore, basically forced to do anything (scalp tickets, flip presales, gamble, sell drugs, prostitute) to pay their bills.

#161 Bill ( Peterborough) on 09.16.10 at 8:20 pm

Re # 147 Nostradamus le Mad Vlad

All the best to you and you family as well, truly enjoy your insightful comments , links as well as a few others on here( you all know who you are)

I try to learn something new every day, again appreciatte your blogs/comments guys.
__________________________________________

Re # 150 Old_is _Gold

Thank you for your clarification, really appreciate it. I believe you are a sincere person trying to expose the world for what it is at this stage. Enjoy your blogs as well. Glad your not a Benny Hinn. As stated earlier I like transparent people( no hidden agendas).

As farth as Garth is concerned , he’s not a bad guy, allows alot of topics on this blog.

He’s already kicked me out twice, done my time , in pugatory.( hit some sore spots with a certain group of people, OY VEY.) But alas I am back to further educated the masses on really the big picture .

The greatest fear of the conspirators is exposure. Little by liitle we must work together to bring these cunning vipers into the light so that the world can see them for what they truly are.

Will be in contact soon. Again thank you for clarification.

#162 Taxpayer like everyone else on 09.16.10 at 8:27 pm

83 Tony – once again you’ve proven you know SFA

http://www.bankofcanada.ca/pdf/annual_page57_page58.pdf

#163 Spiro on 09.16.10 at 8:32 pm

Let’s not forget that there aren’t that many vultures left. About 70% of the households are owned by the people who live in them. The majority of the remaining 30% don’t have the means to buy or they simply don’t care to own a house. For a short period of time we will see some vultures but it won’t be for long. No one would want to touch RE for a while. My opinion is that this will normalize in about 10 years. This is how I see things in the future. Forget that you have a credit card and line of credit or you can borrow money for a house. Then look at how much you are making and based on that, decide what is a fair price for a house. But also don’t think of your house as something you can make money of. When everyone starts thinking like this, then you will see things normalizing. Forget about the age of the easy credit we are about to end. It will never come back! I don’t think it should. Everything inflated so much because of this madness. I don’t think a house should be more than $150K – $200K under the future conditions I am talking about. We have lost our ability to give appropriate values to things. Some rich people suffer from that. You would look at a rich guy and say “He paid how much for that?!”
Yes! We suffer from the same thing and we don’t even have the money! The rich guy has the money and he can afford to be idiotic about buying things for more than what they are valued. Cheap credit did this to us and we cooperated so well.
This idiotic game that was played on us, will not go away easy. It won’t be like you got drunk, took the next day off and then went back to work. It will be more like you got drunk, run over someone with your car and next day you are looking for a lawyer. The mortgages are insured, right? The government will have to get the money from somewhere to cover them. Watch your taxes then people…THAT IS IF YOU HAVE ANY INCOME IN THE FUTURE! My advice to you is not to freak out. Refuse to cooperate. They can’t take from you what you don’t have.

#164 Bill ( Peterborough) on 09.16.10 at 8:33 pm

Garth is there a glitch happening again, comment won’t load

#165 robert in london on 09.16.10 at 8:33 pm

Does this mean the wheels are coming off and I’m catching it in groin? Ouch!

#166 Bill ( Peterborough) on 09.16.10 at 8:35 pm

Re # 147 Nostradamus le Mad Vlad

All the best to you and you family as well, truly enjoy your insightful comments , links as well as a few others on here.
__________________________________________

Re # 150 Old_is _Gold

Thank you for your clarification, really appreciate it. I believe you are a sincere person trying to expose the world for what it is at this stage. Enjoy your blogs as well. Glad your not a Benny Hinn. As stated earlier I like transparent people( no hidden agendas).

As farth as Garth is concerned , he’s not a bad guy, allows alot of topics on this blog.

He’s already kicked me out twice, done my time , in pugatory.( hit some sore spots with a certain group of people, OY VEY.) But alas I am back to further educated the masses on really the big picture .

The greatest fear of the conspirators is exposure. Little by liitle we must work together to bring these cunning vipers into the light so that the world can see them for what they truly are.

Will be in contact soon. Again thank you for clarification.

#167 Taxpayer like everyone else on 09.16.10 at 8:43 pm

141 Foggy – What can I say? It’s differnt here!

http://www.yattermatters.com/2008/07/vancouver-real-estate-average-price/

Check out that “one day” recession in 1990.

#168 S.B. on 09.16.10 at 8:44 pm

This month’s Toronto Life magazine has a scary feature about 2 people who spent 1/2 million on a 2 bedroom downtown Toronto condo. Add to this the land transfer taxes + at least $500/mo condo fees. :?

p.s. Is a $16 billion no-bid , no-vote, fighter jet & maintainence contract during a recession considered corruption?

#169 mab on 09.16.10 at 9:21 pm

Census: 1 in 7 Americans lives in poverty
Number of Americans in poverty jumps to 43.6M; working-age poor at highest level since 1960s

http://finance.yahoo.com/news/Census-1-in-7-Americans-lives-apf-466851241.html?x=0&sec=topStories&pos=main&asset=&ccode=

#170 Behavioral Finance on 09.16.10 at 9:26 pm

Very interesting chart.

http://www.ritholtz.com/blog/wp-content/uploads/2010/09/UUAC-Home-Price-Family-Income-Ratio.png

#171 dark sad person on 09.16.10 at 9:57 pm

#132 goldenfox on 09.16.10 at 2:34 pm

Speaking of Mulroney.

************************

You may have read this-if not-be sure to open-link-
“when Irish eyes are smiling”

http://www.safehaven.com/article/2437/moscow-on-the-hudson

#172 Off the Leash on 09.16.10 at 10:10 pm

Gold Bugs pump it up, Garth and his DAWGS pound it down. Everyones got an agenda, some maybe more deliberate than others, but we all do to some degree that we at least take side if not try convince another to join our club. But when opportunity presents itself as gold peaks or real estate tanks, who then sells or buys contrary to that which they today say.

#173 Ben on 09.16.10 at 10:12 pm

New ad all over the Calgary Herald’s online site

Invest in RE in Fort Mac! up to 17.5% return! Sign me up!

———————————————————

That place is the ahole of the earth and it’s already snowing.

#174 Old_is_Gold on 09.16.10 at 11:02 pm

Greenspan’s Warning on Gold /

Alan Greenspan spoke at the Council on Foreign Relations earlier today, and what was his advice? That central bankers should be doing what these columns, among others, have been rattling on about, namely that they should be paying attention to gold. “Fiat money has no place to go but gold,”

http://www.nysun.com/editorials/greenspans-warning-on-gold/87080

Say it ain’t so – a central banker turned goldbug!

#175 Eddy on 09.16.10 at 11:19 pm

media lies about buyers market? at least they are consistent! They lie about everything! Friends, TV is an alternate reality (and dramatic irony- the audience knows something the actors don’t, or pretend not to know), do yourself a favor and cancel your cable. They lie about the extent of the Gulf oil spill, (watch out Louisiana corexit laced produce) the real reasons for Harper’s wars, the amount of damage that can be done with box cutters, and of course their unwavering embrace of the official 911 fairy tale. for that reason alone they are guilty of accessory to treason.

#176 Weeee! on 09.16.10 at 11:21 pm

That photo happened to me once too! Only they didn’t photoshop out the back tire, the lower frame, the part of the front shocks below the clamps, and the bolt that holds the front tire on too. And I was on a bicycle and 11 years old. The landing wasn’t pleasant.

#177 pezzazz on 09.16.10 at 11:26 pm

Thanks again for tonight Garth. The only disappointment was that you didn’t wear the patented yellow tie.

#178 Randman on 09.16.10 at 11:41 pm

Say it ain’t so – a central banker turned goldbug!

He always was…..just sold out to Keynes for a while

#179 nonplused on 09.16.10 at 11:56 pm

Well, Garth’s not going to post tonight so I may as well throw up another one.

Today I sat in on 2 presentations by banksters with their economic “outlooks”. “Outlooking” is my job. Our team does most of it’s own number crunching but we engage in a fair dollar value of swaps as a result so the banks that want our business are always happy to come share their own research. The first guys were actually quite modest on some points knowing we do our own research. We think they got it right skipping immaterial variations.

The first presentation was mostly about North American energy, and not to go in to all the details, but one of his point was that Natural Gas prices look to be low due to shale gas for the foreseeable future, and at present they are so low banks are going to stop lending in that sector. The supply cost is lower than the forward curve, so drilling is a loosing proposition. Now, be that as it may, my thought was “gas at $4.00 NYMEX is too cheap to drill???” When I started in this business 20 years ago gas at $0.80 was common. If you want your inflation rate look no further and it isn’t 1.5%.

The second presentation was from one of the merged too big to fail New York banks. Surprisingly, I thought they had a pretty good global macro understanding, so I was somewhat surprised to hear it coming from a bailed out New York firm. But of course their analytic departments don’t carry much stroke they just publish reports much like my group does.

Anyway, his conversation was very interesting and I can’t go into all the details. To sum up, low rates in the US are driving capital investment in developing countries (a new carry trade), non OECD countries are increasing demand such that OPEC should have no spare capacity in 3 to 4 years, and Tim Geitner’s efforts to get China to develop more internal demand are nonsensical for 2 reasons, the first being internal demand means more oil use and the second that if US exports to China increase, it’ll be Boeing 787’s and Hummers which all use oil, compounding problems. He was very critical of the low interest rate policy of the Fed.

Incidentally, he showed a chart that correlated gold and oil going back 100 years, basically arguing that OPEC prices oil in gold and always has, although he didn’t state that explicitly, it was my take away.

Even more bad news? His forecast was a slow grind that saw oil rise over 3-4 years to $100 a barrel, and then another financial group would collapse, maybe a country or maybe a group of banks, oil back down, and then a slow rise to $100 and another series of failures. As he put it, if energy rise to a certain level people cannot afford to pay their mortgages.

#142 Hovering

Money isn’t money, gold is money and nothing else is. And other durable commodities. Paper money is just that, paper, a derivative, and dependant on the issuing agency to remain solvent and honor the currency with tangible goods and services. Paper money is a promise to pay, not actual payment. So long as the promise is good, the paper is good. If the paper printer cannot honor the promise, the paper is worthless.

Where we are no in the cycle I do not know, but I suspect the US can still pay a lot. Maybe not all they have promised, but a lot. So paper is worth something. But not 100 cents (slugs of zinc) on the dollar. The market already bears this out. Which is why the penny will soon go out of circulation and the nickel will be the lowest denominated coin, immediately converted to zinc instead of nickel because it’s a money looser too at current prices, and that will buy us another 5 years before the dime becomes the lowliest of the lowly. That will represent a 10 for 1 reduction in the value of the currency, since a dime is sized as if it was made of silver and now is made of zinc and nickel. Yes, 10 for 1. You read it here first folks, that’s why they want to stop coining metal in small denominations. And no your house isn’t going up even in “new dollars”, but it might stop declining against your loan balance.

#180 VanRenter on 09.17.10 at 12:01 am

I am hoping that the bubble bursts as much as the next person here, but to say people wouldn’t select Vancouver over London, New York, Paris or San Francisco I don’t think is entirely correct. I’m in London at this moment and have been for quite a while now with the exception of some time in Paris during this same trip across the pond. Pretty much universally when discussing home with the locals I am told that they would love to live in Vancouver. The possibility exists for me to relocate here to my companies London office and when discussing the thought with both fellow employees based here in London and outsiders, I am told that I’d be crazy and regret the decision.

I also spent time in San Franciso last year and found the overwhelming opinion to be the same as I am finding here in London.

New York I can’t comment on as I’ve only spent about a week there in the recent past.

So, as much as I personally wish Vancouver was not a premium destination (I really wish prices were reasonable so I could buy something), it really is and is most certainly on the global list of preferred cities to live in.

#181 dark sad person on 09.17.10 at 12:17 am

#172 Old_is_Gold on 09.16.10 at 11:02 pm

Greenspan’s Warning on Gold /

Alan Greenspan spoke at the Council on Foreign Relations earlier today, and what was his advice? That central bankers should be doing what these columns, among others, have been rattling on about, namely that they should be paying attention to gold. “Fiat money has no place to go but gold,”

*************************

I take that as a contrary indicator–
Mainly because-have you ever seen Mr Magoo “ever” make an accurate call-ever?
Gawd-it used to be painful trying to understand wtf he was saying-
Now we know why-he had to talk in tongues about-the “new economy” he was directing-the so called
“special financial instruments”
What we now know as-
“unregulated-unaccountable-unknown-knowns”
Namely-the OTC derivative market-where yield was all that mattered and while every Bank on the planet loaded their balance sheets with these-and when price discovery was called upon-by a fierce market unwind-Bankers deciding to hit the exits-all at once-discovered-
Collateral consisted of–
OMFG–we forgot to look at value-before we bought-
OMFG–they’re so complicated in their structure-we can’t understand the makeup-
OMFG-the market will price 300 trillion dollars at ZERO!
OMFG-Open the bad banks and hide them-then-transfer the losses onto those worthless eaters-

http://www.youtube.com/watch?v=TNyTGpnexic&feature=related

#182 Patz on 09.17.10 at 12:21 am

Got there early; got a seat 3rd row center; didn’t win a book; learned that Garth has really spiffy cowboy boots (didn’t reveal my blog name so didn’t get a pointy boot toe in the butt) and had a really enjoyable, entertaining, edifying time. Thank you Garth and your hosts.

#183 vreaa on 09.17.10 at 12:44 am

Thanks for the Vancouver appearance, Garth.
Much appreciated.

#184 Calgary Rip off on 09.17.10 at 9:17 am

http://www.calgaryherald.com/business/real-estate/Finance+Minister+Flaherty+worried+about+slumping+markets+tougher/3538641/story.html

Flaherty wont repeal the new mortgage rules. Good bring the whole mess to its knees.

#185 X-ray-Delta-One on 09.17.10 at 2:23 pm

Coldlazarus, you’re right. The economy is hollowing out here. An active real estate market does not take the place of a diverse economy! Vancouver is becoming like a larger version of Whistler: a resort for the rich. Lots of low-paying service jobs and an unstable economy. Better be a lawyer or a university prof is you want security and a decent income.

The Campbell government’s policies are promoting that hollowing out by focusing on real estate (through bridges and roads), and to a lesser degree, making BC Hydro buy power from independent producers.