Fun with Flipper

CREA admits it: house prices likely to 'recede'. Story

Update: Two days ago as the Japanese nuke-quake  crisis unfolded I told you the likely result would be a dump in oil price and stock values and a jump for bonds. This has indeed happened. As of this morning oil has plunged $4 a barrel, gold’s tumbled $20, the dollar is off two full cents, the Nikkei collapsed 10.6% and global markets are following suit. Meanwhile bond yields have dropped sharply and prices surged as investors scramble to find safe haven. Days like this should make you happy you did as I suggested. — Garth

If I were a carpenter...

As if there were not enough misery in the world, HGTV is about to launch its new season. Of course, there’s no better indicator of societal delirium than the house porn channel, where you can get horny 24/7 over SS and G c-tops. Full-frontal curb views are mixed with curvaceous interiors and endlessly erotic appliances. If you can’t afford the real thing, there’s a hot property virgin just a flick away.

Actually, HGTV’s owner, Shaw Media, had this breathless announcement just hours ago: “Beginning the week of April 5 HGTV Canada is swinging into spring with a stellar new schedule of entertaining, inspiring and informative home-related series. Heavy-hitters, Mike Holmes and Scott McGillivray share the small screen together in the competitive series All-American Handyman.”

Ah yes, Scott McGillivray, one of the HGTV hunks who sure knows how to hammer. The veteran of ‘Income Property’ who also had a dalliance with Debbie Travis, is now an authentic house porn star – quite the career for a University of Guelph grad (in marketing) who decided to become a carpenter. Actually, the carpentry thing was overtaken by the marketing thing pretty fast. And as he threw away his Home Deport tool belt, he also seems to have misplaced his moral compass.

But I’ll let the guy speak for himself.

When ‘Income Property’ – a program showing newbie homebuyers how to build an income suite so they could stave off bankruptcy – first aired, this is what Scott told an interviewer:

“When HGTV first approached me about a series they wanted something about flipping properties,” he confides over glasses of San Pellegrino in a downtown Toronto watering hole.

“And I said no way. I’m not a fan of those shows, particularly the U.S. ones. They are made with a false premise –that everyone can become rich just by flipping a few houses. With the housing crash in America we’ve seen just the opposite. It’s not a healthy time to flip.”

Now that’s a healthy Canadian attitude, eh? No foreplay before the offer is signed. No flipping or kinky stuff. No raunchy deals, just straight-up hunky carpenteresque workmanlike delivery.

But that was then (way back in September of 2010). This is now. Mr. McGillivray has since gone hard core house porn on us. He even does it in the US position.

Two weeks from today the Scott McGillivray Real Estate Success Academy makes its next Canadian stop, this time in the gorgeous Saskatoon Inn, conveniently close to the airport, amid that giant atrium full of exotic dusty plastic plants. Billed as “The Insider’s Edge”, the TV host has personally invited the locals to come out and see how ,”smart investors are making millions from tax deed auctions, foreclosure flips and pre-auction events.”

“I am personally inviting you to attend,” he says, to learn how to “buy property for pennies on the dollar… cherry-pick the best properties before the public has access to them… and purchase at rock bottom prices before they are bid up by hundreds of other investors.” And absolutely no attempt has been made to Canadianize this US house lust gig, with main sponsors being Bank of America, Chase and Citibank – companies with an endless supply of US foreclosed homes nobody wants.

Now I’m not out to trash a fine young Canuck TV star, wholesomely married to a school teacher chick and living north of the GTA – where he claims to have 18 properties and 100 tenants. If he needs to be the shill for an ethically-challenged, get-rich-quick, flip-this-house real estate come-on designed to cater to greed and sup on ignorance, that’s his problem. I just feel bad for Saskatoon.

But this also should be held as a handy little symbol of the people we’ve turned into. Shallow. Material. Greedy. Opportunist. Happy to prey. Horny for stuff. Faustian.

Any nation that defines itself by where it lives, or creates heroes of carpetbaggers who used to be carpenters, is seriously messed up.

Did I mention this will end badly?

It just did for Anthony Sayers:

A co-host of two popular home improvement TV shows has been accused by Toronto Police of being a chiseler. Barrington Anthony Sayers, the featured carpenter on all 52 episodes of W Network’s series Me, My House and I, and co- host of The Unsellables show on HGTV, was arrested Saturday by officers from 53 Division.

In a statement Monday, Toronto Police said an investigation was launched after a woman complained about incomplete renovations on her home and accused the owner of Anthony Sayers Custom Builder and Design of doing shoddy work, harassing her and extortion.

Police said the 41-year-old also uses the name Anthony Sayers.

A graduate of George Brown College with 17 years of professional experience in the building trades, he is charged with two counts of criminal harassment, attempted fraud under $5,000 and extortion.

173 comments ↓

#1 Bigboy on 03.14.11 at 10:31 pm

Bring back the cat and dog pictures please, they make me feel soft and cozy, despite the crap that is going on all over the world! Sigh!!

#2 Cyrus on 03.14.11 at 10:40 pm

must see picture .http://upload.wikimedia.org/wikipedia/en/d/d2/Keepoutofdebt.JPG

#3 R on 03.14.11 at 10:41 pm

When the Canadian crash comes, will you entertain offers from HGTV to do housing crash disaster porn… where you swoop in like a financial Gordon Ramsey, ready to whip this poor suckers into shape, cutting up cards, sending back flatscreens and cracking one liners?

It could work.

I have goosebumps. — Garth

#4 Jack on 03.14.11 at 10:41 pm

A colleague told me she’s heard for 10 years that real estate prices are coming down in Toronto. Hasn’t happened. Anyone have any info to the contrary?

#5 eddy on 03.14.11 at 10:46 pm

What angers me about HGTV is so much of the content is highly subsidized by government grants. Its as bad as Harper giving our tax money to CBC to broadcast ‘W heel of Fortune’. Speaking of the DEVIL, in case you missed it:

It’s Official. Stephen Harper is Privatizing Our Water

http://nauresistance.org/2011/03/its-official-stephen-harper-is-privatizing-our-water/

#6 squidly77 on 03.14.11 at 10:46 pm

Real Men have no tolerance for men that bully and intimidate women. He is the true definition of a loser.

#7 Harry on 03.14.11 at 10:53 pm

Saskatoon eh?
Maybe he can put more air into the bubble.
For $hits and giggles I might attend.

#8 Maxamillion on 03.14.11 at 10:57 pm

Anthony Sayers is a respectable guy. Come on it’s only fraud under $5000. It’s not like he spent $26 million of your money to tell you how great he was.

http://www.theglobeandmail.com/news/politics/harper-government-spends-26-million-on-winter-ad-blitz/article1940253/

#9 S.B. on 03.14.11 at 11:02 pm

Follwing yesterday’s comments: Green power sounds great and works..a bit. But it’s not yet practical or affordable for all of our needs. They are using this crisis to remove nuclear reactors and take us back to the technology dark ages. Power costs will then soar. And we’ve be even poorer. That’s the plan.

Stop and think for a sec, there are almot 7,000,000,000 people on the plant. If 10,000 perish in a tragedy, what percentage is this? And then do all 7,000,000,000 of us have to play along and change our lives?
Look, they used 20 alleged arabs with boxcutters to “change the world” and all 7,000,000,000 us were made to suffer via loss of freedoms. Case closed, it was solved by 3pm on Sept 11th, 2001.
Never forget it, the most powerful weapon in the world is the Media. And you have it aimed at your face, in your house, every day.

They throw one “global crisis” at us each day, until be break and go along with everything they ask of us.

We have Repeaters, not reporters. Every news story gushes with emotion, not fact. This is by design, the most brilliant and skillful social change agents control every global story. They have spend decades observing and testing us; the outcomes are assured, with the correct inputs. Not to mention the various world armies’ and intelligence agencies paid forum plants who work daily at manipulating us. Twitter. Facebook.

Witness the controlled chaos we see every day. Do you think it is designed to make us healthier, more free, richer? Don’t kid youself.

#10 nonplused on 03.14.11 at 11:12 pm

Wow, Garth, you watch a lot of….. TV.

#11 HouseBuster on 03.14.11 at 11:22 pm

The Canadian crash will come fast and furious.

It is not long now before Vancouver real estate is going to be averaging 300K.

That’s right, a 70% drop is on the way! And that’s just for starters.

#12 Elmer on 03.14.11 at 11:28 pm

I’m confused why you have a beef with these types of shows. I find them entertaining and sometimes even informative. Surely you’re not suggesting shows such as these are responsible for stupid people getting in over their heads in debt? Or is personal responsibility not something you believe in?

#13 Jsan on 03.14.11 at 11:29 pm

The Real Estate industry is chock full of illusions and scam artists. Unfortunately there are way to many suckers in naive new home buyers and “investors”.

A&E Network “Flip This House” fraud.

http://www.youtube.com/watch?v=3aG5G38GzhU

http://www.youtube.com/watch?v=zM8pXjLyGtE&feature=related

#14 Jsan on 03.14.11 at 11:33 pm

“#9 S.B. on 03.14.11 at 11:02 pm

Follwing yesterday’s comments: Green power sounds great and works..a bit. But it’s not yet practical or affordable for all of our needs. They are using this crisis to remove nuclear reactors and take us back to the technology dark ages. Power costs will then soar. And we’ve be even poorer. That’s the plan.”

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

SB, here’s a different explanation of the Nuclear mess in Japan.

http://www.businessinsider.com/japan-reactors-pose-no-risk-2011-3#ixzz1GZnQnOSj

#15 sue on 03.14.11 at 11:38 pm

I really enjoyed Income Property…esp all that hammering.

#16 BC Bring Cash on 03.14.11 at 11:47 pm

I think most of us following this blog know that the Flipper days are over. An interesting article in March 12th edition of Canadian Business about China’s coming collapse is a a good read. Headline says “Middle Kingdoms prosperity is an illusion. And when China finally falls, we’ll all feel the pain.”
Home prices have in 70 of China’s cities more than tripled in the past 5 years. 65 million urban homes reported zero electricity consumption. In prime markets like Beijing and Shanghai, prices have risen far faster. Apparently its no longer surprising to find taxi drivers and school teachers who claim to own two or even three apartments each. There are enough vacant homes in China to house 200 million people. This will not end well. Perhaps that is why the so called Chinese investors are buying Richmond, Vancouver etc.. because to them they appear to be such a bargain.
In other words China (Communist China) is engaged in an elaborate shell game to hide a mountain of bad debts piling up on the balance sheets of its banks, developers and state owned enterprises. In the case of real estate , its a matter of turning a blind eye to staggering losses. According to Patrick Chovanec.
Canada’s commodity and export driven economy cannot bode well when China finally stops buying our resources. When China tanks so do we and especially RE.

#17 freedom_2008 on 03.14.11 at 11:51 pm

For anyone who are thinking buying a rental or flip property in US, Please listen to the Snowbird Beware show (1,2,3) by David Ingram in the link below.

Basically it is a complicated matter, you can go to US jail for doing any work or rental management on the property. Even if you live there yourself, but rent it out for just one day.

Check it out (you can also find them on Google by searching “David Ingram: Snowbirds Beware”)

http://www.google.com/search?q=David+Ingram%3A+Snowbirds+Beware&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a

#18 Bottoms_Up on 03.14.11 at 11:52 pm

Garth, for over 2 years you’ve been preaching ‘this isn’t going to end well’.

I challenge, no, wait, I triple dog dare anyone with a Canadian real estate horror story to step forward and tell their tale.

Hasn’t happened and won’t happen for some time. This tells me the top is not yet in.

There are gains yet to be had in the Canadian real estate market.

#19 nonplused on 03.14.11 at 11:58 pm

I guess the American experts familiar with the type of BWR’s in trouble in Japan are saying they do not think a sizeable radioactive leak is possible even in the event of a meltdown. So one possible disaster averted. Or so they say. On the other hand the BP Gulf spill was “no big deal” for a long time too. Let’s hope they are right.

I still think this disaster, in addition to the now apparent terrible and ongoing human tragedy, is going to roil the markets in unpredictable ways for many months or years to come. The world’s 3rd largest economy has ground to a halt, and won’t be up to speed for a long time. What’s that going to do to global growth?

A lot of what was lost will probably never be rebuilt, including the reactors. It will be some time before the electric grid is operating at 70% of its former capacity. Fresh water is unavailable in large areas. Sewer systems aren’t operating. They got a lot of things to fix before they worry about building gadgets for export. And with that will come bankruptcies, write-offs, and major losses (payouts) for insurance companies. The tax base will be irreparably damaged for a long time just as expenses will be higher than ever.

The ace in the hole that Japan has is $800 billion in US treasuries, which they can tap to rebuild if the Yen doesn’t hold. QE3 in now a certainty, with another major seller on the block (and the loss of a purchaser, as Japan moves from the “buy” to the “sell” column). Jim Sinclair was right, it’s QE to infinity.

Watching the aerial footage of the tsunami coming in is a truly wrenching experience. It looks like an unspeakably large avalanche that just doesn’t stop. Cars are driving by on roads and a few seconds later the roads are totally underwater. The death toll might not reach 240,000 like Malaysia, the Japanese know to head for higher ground after an earthquake, but I would not be surprised.

What does all this mean for Canadian housing? Well, I don’t know. But I think its either higher rates or higher inflation. Both should be negative as both will squeeze Canadian wage earners.

On the other hand, who cares what it means for Canadian housing? We should all donate something to the Red Cross or your preferred humanitarian organization. In the short term, they need help with fresh water and food. Be careful of fraudsters, go with someone you know.

Nature is a very harsh mistress.

And no, global warming did not cause an earthquake. This is one of the risks we live with all the time but ignore because “it hasn’t happened yet!”

Plug for the old Xurbia or other people who think a “bad day box” is a “good idea”. If everyone in Japan had a bad day box they would probably be really thankful right about now, but they don’t. It’s a very cohesive society that is well prepared for earthquakes and tsunamis, so no one probably thought they’d be on their own for a while. This one was a bit bigger than town hall planned for.

#20 S on 03.15.11 at 12:00 am

#11 HouseBuster on 03.14.11 at 11:22 pm

Dude, not even after the big one. The only large Canadian town that doesn’t get buried under several feet of snow each winter (even though this year sucked something spectacular). They’ll be giving houses away in Edmonton and Calgary before you see those kinds of averages. We can only wish…

#21 squidly77 on 03.15.11 at 12:00 am

Japan down 1,000 points plus.
http://e.nikkei.com/e/fr/marketlive.aspx

#22 Kitchener1 on 03.15.11 at 12:00 am

That guy is annoying, cracks me up everytime i see that clown.

best part are the fools he brings in after the basment is staged.

Property Apprasier–umm, this cheap ass reno will add at least 100k to the value of the house, should have gone with real hardwood floor and not laminate, that would have been worth an extra 25k………..yea okay.

Rental agent– this shoebox with no natural light will rent for 1200 a month at least…… too who??? when u can rent new condos for that???

Are those guys paid actors?????

On a sad note, market futures as of right now are in down, like market crash areas… its pretty much confirmed that the nuclear plant in Japan is in full meltdown mode– staff have been told to leave so it looks like there is nothing more that they can do.
and…………… the wind patterns have now shifted to blow inland-possible toward toyko….. and experts are calling for another 8.0 quake for the aftershock. worst then anyone could have ever thought possible. My heart and prayers are with the people of Japan tonight.

My hearts with the people of Japan

#23 Wise Guy on 03.15.11 at 12:01 am

To entertain ourselves, my girlfriend and I went house shopping this weekend in Toronto or more truthfully just walked into open houses to see what crap people are shelling.

Honestly, you can read it all you want here, you can see all the pictures you want, but until you walk into some of these homes and see some of the prices they are asking, it is unreal

We looked at one house in particular asking $799,000, slanted stairs, painting over wallpaper, remnants of “bed bugs” (and the only way my girlfriend new that was because she once lived in an infested home in downtown Toronto).

Anyways, essentially $800,000 for a house that I truly would not pay $400,000 for and I’m being sincerely honest.

Everything takes time and these prices will start their drop this year in Toronto and as Garth says, continue for years to come.

#24 Sargon on 03.15.11 at 12:01 am

C’man….who doesn’t get all warm and fuzzy inside after watching IP participants exchange knowing glances when they find out how much dough their new basement dwellers will be forking over?

It’s as if to say “Now I can almost afford to pay the mortgage we’re trapped in after my wife formed some sort of emotional attachment to this Victorian money pit.”

#25 squidly77 on 03.15.11 at 12:04 am

All hell is breaking loose, now down 1,200 points.

#26 Soylent Green is People on 03.15.11 at 12:23 am

When the housing market crashes and all those virgins lose all their money, I want an intelligent person to be in charge of Canada. Someone who’s not going to disgrace us on the world stage.

……………….

March 11, 2011: The New York Times on our next Prime Minister

“I don’t care what they say about me, that’s not the issue,” Mr. Ignatieff said.

“There came a moment at Harvard when I thought that I had to decide: do I want to be a spectator, or teacher, in someone else’s country? I was frustrated by the fact that you could keep writing these articles and nothing would happen.

It was time to come home and take responsibility. I don’t want to get on my high horse about it but there was something there, existentially.”

http://www.nytimes.com/2011/03/12/world/americas/12canada.html?_r=1&scp=2&sq=Canada&st=cse

.
.
.

#27 Jon B on 03.15.11 at 12:26 am

No doubt greed is alive and well these days. I worry about the future ramifications when greed goes mainstream. I think it already has.

#28 45north on 03.15.11 at 12:28 am

Jsan: linked to an article written by Dr Josef Oehmen:

I mean a level of radiation of more than what you would receive on – say – a long distance flight

Read more: http://www.businessinsider.com/japan-reactors-pose-no-risk-2011-3#ixzz1GdZ5gO5O

well power in Ontario is definitely getting more expensive, the present Liberal Government is paying 10 times the going rate for solar power, Dalton McGuinty and others are trying to spin this as best they can.

Japan has its back to the wall, it has to go nuclear. Has to. God bless the people of Japan and its leaders.

#29 The Original Dave on 03.15.11 at 12:40 am

for the person in the last thread that said “HA” or whatever in regards to buying uranium stocks, first off, that’s weird that you get off on what you presume to be another person’s misfortune…key word presume. I was and still am very bullish on uranium. Bought many stocks in 2008 and 2009 that were .30 cents – $1.00 (check pinetree capital, denison, laramide, paladin,uec, etc.).

By you saying “Ha” in regards to the uranium market is equivalent to me saying “Ha, you sold your real estate property in Vancouver in 2011”. They’re just polar opposite trends. I managed to load up today on more uranium stocks. Many of them down 25% and more. I got some real gems that I neglected in the past and I felt I was priced out of. Today was a gift – investment wise.

The people that are aware of whats happening in the uranium market know where I’m coming from. China and India are building and planning to build hundreds of nuclear power plants. Only 2% of China’s energy comes from nuclear (that’s 2% and not a typo). Currently, the U.S gets 20% from nuclear (that will be increasing too).

This trend is happening all around the world. Uranium is cheap (for now). There are only a handful of mines in the world that are actually producing uranium at the moment, which is why China is stockpiling and a few months ago bought a 2 year supply of uranium. Oh, it gets better….Russia’s deal to supply decommisioned nuclear weapons to the U.S ends in 2013. This is what is called above ground supply. The amount of uranium this deal supplies to the uranium market is: 30% of all uranium fuel (that’s not a typo either).

So, after spending billions of dollars on each nuclear reactor, China, India, Korea, France aren’t going to nickel and dime when buying uranium. If the price is over $100 a pound, so be it. There will be a battle to secure above ground supply of uranium. It takes years for a mine to come into production. There will be pitches made to buy up uranium enriched properties and companies.

I’ve said this before, these are very volatile stocks and not recommended for everyone. What I see as being extremely bullish is the uranium/nuclear industry in general and anyone who has done any bit of research is aware of this. We’re talking about an industry that was completely hated and detested for decades. Nuclear represents an important part of the world’s base load energy mix – love and sunshine will not, unfortunately, provide us with energy abundance.

Haven’t you ever heard anyone say “sell on good news and buy on bad news”? Today was very bad news for nuclear. If your thoughts come to fruition that the nuclear industry is done as a base load energy source, be prepared to shiver in the dark. Japan has already proposed hours in the day in which there won’t be any power. Take a guess why.

What I’m talking about is very aggressive stuff that I’ve learned through the years. Don’t not do what I’ve said. I always keep a significant amount of money on the sideline to purchase because days like today happen and really understanding your emotions and mass fear and mass greed might be tough sometimes.

I’m not preaching about purchasing stocks and uranium etc. It takes A LONG TIME to learn. If you’re not informed enough, you will take a beating. The best investing method is Garth’s method – tax efficient, liquid, stable and so on.

#30 Mr. Reality on 03.15.11 at 12:49 am

There is only one show that is worse than anything on HG. Entertainment Tonight: Canda! I hate Rick the temp!

Mr. R.

Japanese markets dropping 12% as i am typing this. yikes

#31 Timing is Everything on 03.15.11 at 12:57 am

But this also should be held as a handy little symbol of the people we’ve turned into. Shallow. Material. Greedy. Opportunist. Happy to prey. Horny for stuff. Faustian. – Garth

Oh, you mean like the Americans….just before their RE crash.
Well, they are learning, the hard way. Must we repeat the whole sordid affair? Is it too late?
I think I know the answer to both. Sigh.

#32 Roial1 on 03.15.11 at 12:59 am

You know Garth, I can just barely remember when HGTV actually had some garden shows.

There my alheimer’s is not too bad after all. Especially if I can remember that far back.

#33 Reza on 03.15.11 at 1:09 am

I’ve been an spectator of the Toronto Market boom patiently waiting for the prices to normalize for some 9 years but tell you the truth am getting tired of it. How does it make sense to pay north of 600k for a 50 yr old 50*120 bunglow on crappy part of town? If you build a 3500 sqft at $150 a ft, it’s going to cost you $1,050,000.
Who is calling this affordable? Show me some sense. But it seems the rich Asians arriving here have no sense of value whatsoever and pay whatever they are being asked. $500, $600 or $700 sq ft condos are becoming norm. Paying $400k for a 600 ft condo is not unusual. I’m making $120k and these numbers don’t make sense to me? wake me up? Have I gone mad?

#34 EJ on 03.15.11 at 1:09 am

“The Insider’s Edge”, eh?

Well, I guess it sounds better than “How to line your greedy pockets at the expense of a young family who just wants a place to live.”

#35 Nostradamus Le Mad Vlad on 03.15.11 at 1:09 am


Masters of Bullshit Hear no evil, See no evil, Speak no BS about evil. Or thereabouts. Can y’all smell thousands of Bernie Madoff-with-everybody-else’s-loot in the making?

“It’s not a healthy time to flip.” — Sure as hell ain’t a good time to buy either, unless one is planning on doing a RRSP-Mortgage and is fabulously wealthy to begin with.
*
#164 Macrath on 03.14.11 at 10:10 pm — “. . . that earth quakes followed along the fault line in succession. Suggesting the possibility of more large quakes on the pacific rim in the near future.”

Apparently, the entire Ring of Fire, from Alaska down to NZ, back up through Japan then Alaska is seriously damaged and, of course, the West Coast is overdue for one; Haiti, Chile, NZ and Japan have had theirs recently, so the trend continues.

This doesn’t include the New Madrid Fault or Yellowstone (on the surface), but way underground I would surmise there is something connecting them all together. The Ring of Fire and the Juan de Fuca Plate.
*
Chaos — something in this? 2204 was the Boxing Day tsunami – ‘quake.

Aerial pix of burning plant, Fourth reactor on fire, and Will GE be called for shoddy workmanship? Tokyo Store shelves emptied. Should have stocked up with basics sooner. Japan – Canada’s nuke dance. Combined with the SAF, this will be an interesting double-whammy.

Changing Words To propagate the GW garbage.

The US Fed has bought this on themselves; possibly Cdns. should look at doing something similar.

Mt. Fuji — don’t forget about that one, Nikkei drops Tuesday, while US – Saudi tensions increase, 1:14 clip Similar to the US Fed’s protests? Maybe that is why the Saudis have gone into Bahrain and ‘Quake shifts Japan.

Reality sets in for US.

#36 BrianT on 03.15.11 at 1:29 am

If these comet geeks are right, there will be lots of bawgin pwoperties for sale (to paraphrase Tom Vu)-supposedly big dates are tomorrow and Sept 26/11

http://endtimesforecaster.blogspot.com/2011/02/comet-elenin-and-pole-shift-theory.html

#37 Thetruth on 03.15.11 at 1:48 am

Facts:

Anyone that bought a house whenever in the past in the Vancouver area is better off than those that didn’t! Especially those that bought in 2008!

Speculation:

The market is gonna correct and then a melt….

Go with facts or speculation??? your choice.

#38 Whistler Dude on 03.15.11 at 1:48 am

The next headline will be “Japanese fleeing radiation buying up west coast RE” (downwind BTW). The Japanese will save Canadian housing! Trading one earthquake zone for another. You don’t hear much how Richmond and Delta, BC, sit on the same sort of soil as Christchurch, NZ. And how Squamish is down stream from a large lake (Garibaldi), that is held in by a weak barrier (there’s a good reason why the govt bought the properties in the canyon area between Squamish and Whistler. Whistler won’t be much fun should the sea-to-sky hwy slip into the ocean. And few other avenues of escape (especially in winter).

#39 betmax on 03.15.11 at 1:52 am

#4 Jack: “A colleague told me she’s heard for 10 years that real estate prices are coming down in Toronto. Hasn’t happened.”

“10 years” — either fiction or a very bad call.

I know someone who was diagnosed with lung cancer after smoking for 20 years. Till they were diagnosed, they didn’t think cancer was going to happen to them.

Both of you were fooled by randomness: just because something goes on for a long time doesn’t mean it will continue forever.

#40 Brian1 on 03.15.11 at 2:38 am

Regarding Japan: I was startled by economists and Kevin O’leary who pointed towards the good that will come from this tragedy. Much needed stimulus as what was applied after WWII in Europe and Japan will result, they say. This would be some sort of weird karma would it not?
Well, where would this money come from? If Japan has it why were they so depressed in the first place? Can America come up with it as they did with the Marshall plan, in spite of their ongoing problems? Will Canadian and Australian house prices remain strong after all? Is the coming recession stopped before it had a chance to get off the ground.These are questions of which I presently ponder.

#41 March of the Pigs on 03.15.11 at 2:49 am

#14 Jsan

Keep your head in the sand, you read the headlines this morning? The problem with people is that they evolved from stupid greedy monkeys.

#42 bridgepigeon on 03.15.11 at 2:49 am

5 eddy
You remember when they tried to privatize Bolivia’s water?

#43 Crash Callaway on 03.15.11 at 2:55 am

Thanks Garth for keeping the light shining on those morally defunct creepy crawlies.
And as usual done in classic Turner scathing & brilliant fashion.

#44 March of the Pigs on 03.15.11 at 3:06 am

So we short Nuclear and go into a long position in healthcare? Anyone know if Vegas is taking bets on if there is going to be a full meltdown? There has to be a way to make money off one of the largest cities on planet Earth being exposed to a nuclear meltdown…

Kudlow summed it up pretty well on CNBC that at least the economy is not going to be as bad as the human tragedy. Count your blessings…

#45 islander on 03.15.11 at 3:23 am

Nobody forces anybody to watch these shows, or to act on their advice.
The guy is capitalizing on his good looks to earn a lot of money.
People are free to ignore him.

#46 Jas Girn on 03.15.11 at 3:29 am

Belated happy birthday Garth!

#47 betamax on 03.15.11 at 4:55 am

Confirming retirement predictions made here:

http://www.marketwatch.com/story/retirement-savers-confidence-plummets-2011-03-15

#48 Values on 03.15.11 at 5:08 am

It seems Canadians are indeed becoming American’s under a maple leaf mask. Sadly, there isn’t too much difference between the two cultures as there used to be.

Ever watch US Supernanny? American parents are huge consumers of stuff they don’t need, why? Because they think constantly buying stuff makes them happy, when in fact it doesn’t at all.

They have lost their values and because of this fail to pass values onto their children. This in turn makes the kids unhappy as they don’t want stuff, they just want to be loved but the parents do not understand that and instead buy them more stuff.

Real estate is just an extension of stuff, you don’t need to own to be a happy family, renting will work just as fine. In fact, renting will free up time to do more family things together.

#49 SquareNinja on 03.15.11 at 6:29 am

Happy belated birthday, Garth!

#9 S.B.: Are you one of those global warming deniers? Of course when disaster strikes one, the many should react appropriately to avoid repeating the same mistake. It’s how safety is increased.

Moreover, the cost of nuclear reactors per Kwh is actually greater than that of clean energy; such as wind or solar. New nuclear plants usually suffer massive cost overruns, then there’s the cost of storing radioactive waste, and then there’s the cost of decommissioning an old plant. Nuclear power just doesn’t make sense.

By your own equations, why yes, yes I would trade your one life for the many that died in Japan.

#50 Herb on 03.15.11 at 6:52 am

… the people we’ve turned into. Shallow. Material. Greedy. Opportunist. Happy to prey. Horny for stuff. Faustian.

!

#51 Nemesis on 03.15.11 at 7:10 am

“…Full-frontal curb views are mixed with curvaceous interiors and endlessly erotic appliances… But that was then (way back in September of 2010). This is now. Mr. McGillivray has since gone hard core house porn on us. He even does it in the US position.”… – Hon. GT

You have surpassed yourself. It’s time to put aside financial blogging (temporarily), GT and pen a roman à clef on life inside ‘the party’/Ottawa…

In other news…

[FT] – Equities tumble in wake of Japan disaster

http://tinyurl.com/4g3axqh

[Reuters] – S&P futures slide 3 percent, Treasuries soar as radiation rises

http://tinyurl.com/4usq7gt

#52 the real r on 03.15.11 at 7:54 am

here’s a cover image for you garth: http://www.amazon.ca/gp/product/images/0771577214/ref=dp_image_0?ie=UTF8&n=916520&s=books

#53 landlord22 on 03.15.11 at 7:56 am

Garth, I am surprised you are not more enthusiastic about homeowners having an income suite. Sacrifcing a bit of square footage in exchange for reduced mortgage payments and extra tax deductions seems reasonable to me. It may be about staving off bankruptcy in some cases but not everyone is overleveraged and not able to make their mortgage payments.

#54 BPOE on 03.15.11 at 7:58 am

We should have a 24 hour Vancouver channel the rest of these show I have no interest.
Smart money sold all investments on the day of the Japan earthquake announcement. The beauty of being liquid. The investing world changes fast and you need to react.

#55 Form Man on 03.15.11 at 8:18 am

#18 bottoms up

you obviously don’t live in Kelowna, where the horror story is real……

#56 Another Albertan on 03.15.11 at 9:27 am

Macrath:

You were prescient. INES was raised from 4 to 6 in the last 8 hours. This is an extreme deterioration of conditions.

I am still more concerned about the crisis management communications versus the technical details of what’s unfolding.

Everyone else’s mileage may vary.

#57 Live Within Your Means on 03.15.11 at 9:28 am

#32 Roial1 on 03.15.11 at 12:59 am
You know Garth, I can just barely remember when HGTV actually had some garden shows.

There my alheimer’s is not too bad after all. Especially if I can remember that far back.

…………

So true. I don’t know why they continue to call it Home & GARDEN. Really sad. It was the reason I started to watch it. My memory is sadly lacking too.

#58 Ret on 03.15.11 at 9:33 am

I love those shows showing basement income suites. Permits? Inspections? Ceiling heights? Fire code and electrical? Zoning compliance? They never address any of those issues.
So any tenant in one of these suites can walk at a moments notice. All they have to say is that the suite that you have rented to me is not compliant because of a building, fire or an electrical code defect.
Oh, and you can give me back all my post-dated checks and sign off on the lease as well, or shall I call the authorities about my concerns?

#59 Utopia on 03.15.11 at 9:37 am

The end of the artificial wealth-effect?

With the dollar already off two and half cents, Japanese and other Asian markets taking it on the chin this morning and all signs pointing to “healthy” correction in our own stock markets we may well have witnessed the exogenous shock I was warning about to our economy in Japans earthquake.

I can assure you that none of this is real estate positive.

It is not the end of the world as we know it either though and traders will tell you this is one hell of a money making opportunity (bearishly speaking).

So what do I antiipate? A very healthy and overdue bounce in the US dollar over the short term just for starters, an eventual weakening of the Yen and some really good deals on Uranium stocks just for starters.

Gotta go. No time left.

#60 Moneta on 03.15.11 at 9:39 am

Anyways, essentially $800,000 for a house that I truly would not pay $400,000 for and I’m being sincerely honest.
————
I’m in Ottawa but travel to Montreal quite a bit. I was thinking that maybe we should have bought a house closer to the train station.

So to amuse myself, I did some looking. If we moved there, we’d be paying twice the price and often with no garage for a 1950s house. The drive to Montreal would be exactly the same but I’d save 10 minutes on my drive to the train station if I took the train.

I just can’t figure out Ottawa. The traffic is in the core and the core is easily accessible from the burbs. Why would I pay a million when I can get the same lifestyle for a third in the burbs?

#61 cash is king on 03.15.11 at 9:41 am

This cannot be good for HGTV ratings. Then again, everyone loves a good scandal.

http://www.theglobeandmail.com/news/national/toronto/woman-who-sought-hgtv-host-for-help-alleges-extortion/article1941255/

#62 S.B. on 03.15.11 at 9:45 am

Looks like a Black Tuesday underway? Gold, Silver are but cyclical commodities. Ride the bull, then be savaged by the Bear:

http://finviz.com/forex.ashx

#63 Suburban Guy on 03.15.11 at 9:46 am

The housing boom has ended———-in Pickering

#64 prairie gal on 03.15.11 at 9:57 am

#9 SB: that is the dumbest comment I have ever read. Why would the government want to torpedo the economy by forcing energy prices to unaffordable heights?

Governments are acutely aware of peak oil and the immediate need to reduce GHG emissions. This is a classic ‘wicked issue’ in public policy – there will be pain, there is no doubt – its up to the powers that be to decide who bears the brunt of it and what type of pain will be deemed the lesser of the many evils that will befall us in a future of constrained energy choices.

Sorry but you can’t just consume more than what you need and expect no consequences for future generations (or even the future you).

#65 Moneta on 03.15.11 at 10:00 am

Facts:

Anyone that bought a house whenever in the past in the Vancouver area is better off than those that didn’t! Especially those that bought in 2008!

———–
2008: I bought a 600K house, 40 year mortgage, 0 down on a 60K income. My payments are 2500$ per month. I don’t have much money but it’s OK because I have a renter in my basement who pays for my food.

2011: I bought a 600K house which is now worth 1 million. I’m still tight on amonthly basis but now that my house is worth 1 million, the ramen noodles taste really good.

2013: I have to renegotiate my mortgage this year, I think I’ll have to find and extra renter because my mortgage is ballooning to 3200$ per month which represents 80% of my income. I’m pretty sure the existing renter won’t mind living with a new one when he understands my predicament.

#66 Not Fooled By Property Spruikers Hype on 03.15.11 at 10:12 am

1975 in Australia only 24% of average income was needed to service a typical Australian mortgage. This was with a prevailing interest rate of 10.38%

By 1985 it was still steady at 24% of average income needed to service despite interest rates soaring to 13.5%

1990 Interest rates went to 16% plus but you still only had to use 34% of average income to service a mortgage.

By 1995 you needed to use 29% of average income to service a mortgage (10.5% Interest rate)

By 2005 it had soared to 40% (7.3% Interest Rate)

Now in 2010 it takes a staggering 50% of average income to service a typical Australian mortgage despite interest rates being only 7.79%

Despite this REALTORS continue to say Australian property prices will double every 7-10 years???

How will anyone pay for it?

http://nfbpsh.blogspot.com/2011/01/home-ownership-getting-tougher.html

#67 Ottawa S on 03.15.11 at 10:21 am

I don’t know where HGTV finds these people. Scott McGillivray’s constantly running his fingers through his hair while he talks about how much cheap renos have added value to houses just outright annoys me.

Then there’s also another, who before his HGTV days was a lousy carpenter with a cocaine problem (don’t ask how I know)

HGTV really knows how to pick ’em…

#68 Thetruth on 03.15.11 at 10:27 am

If Chernobyl x 3 occurs,

Expect a million people from Tokyo to be invited by the Cdn lobby to Vancouver. If you think RE prices are high now, u ain’t seen nothing yet!!

#69 Ottawa S on 03.15.11 at 10:33 am

#12 Elmer on 03.14.11 at 11:28 pm

I’m confused why you have a beef with these types of shows. I find them entertaining and sometimes even informative. Surely you’re not suggesting shows such as these are responsible for stupid people getting in over their heads in debt? Or is personal responsibility not something you believe in?

The problem with these shows is that they a) fuel greed and bring out the worst in us, and b) don’t do anything for quality of workmanship (except maybe Mike Holmes)

They show people how to do things the cheap way, which usually isn’t the right way. I’ve been looking at houses for six months now, and I’ve seen a LOT of bad DIY jobs. 5% nicely professionally done renos, 95% crappy renos (including DIYers and so-called professionals). Everybody thinks they can do it, since they are taught how to do it on HGTV. Want a new tile floor in your kitchen, well, according to an HGTV show I recently saw, why not just lay the tile overtop of your old filthy layers of linoleum? Doesn’t matter that you will stub your toe every time you walk into the kitchen since the kitchen floor is now two inches higher than the hardwood from the dining room leading into it, and who knows what is rotting under the tiles? Who cares? It will look great and you’ve just increased the value of your home $10,000 by having a tile kitchen floor!

Good grief…

#70 S.B. on 03.15.11 at 10:37 am

#49 SquareNinja on 03.15.11 at 6:29 am

Am I a “Global Warming” denier you ask? (I know, I know, it’s tantamount to denying a holocaust).

Do you have a short memory? What about the alleged Ozone Layer hole? Repaired itself?
What about that Acid Rain scare, did it just go away?
The benefits of Oat Bran? Geez.

Or are all of these things a passing media fad designed to bilk our money and time?

You have two choices here: google search for “Climate Change”, or “weather warfare”. Compare the results and get back to me.

I’ll bet in the 90s, too, you were a believer-cum-expert on Ozone Layer and Acid Rain.

#71 Ottawa S on 03.15.11 at 10:39 am

#53 landlord22 on 03.15.11 at 7:56 am

Garth, I am surprised you are not more enthusiastic about homeowners having an income suite. Sacrifcing a bit of square footage in exchange for reduced mortgage payments and extra tax deductions seems reasonable to me. It may be about staving off bankruptcy in some cases but not everyone is overleveraged and not able to make their mortgage payments.

Most people I’ve seen on “Income Property” are short on cash and desperately need the income. So they are being encouraged to borrow another $10,000 to $40,000 to bring in an extra $800 a month. Where is the sense in that? Borrow to generate cash flow? If you are that tight on cash that you can’t afford your house, sell it and rent for a while. And I have not seen the show talk once about tax implications (you have to declare the income to be able to capitalizing the expenses).

#72 Lonely Limey on 03.15.11 at 10:43 am

The best financial advice video ever.

http://vimeo.com/3993848

#73 poco on 03.15.11 at 10:44 am

#18Bottoms_Up–you just wake up from a hangover or have you had your head stuck up your ass for the last year
i take it you don’t bother reading many posts –just scan them do you–don’t take in any information of what’s really happening to the housing market on the west coast–go back and read a few–you’ll see how many owners are in serious trouble
properties sitting for months-price reductions galore —

triple dog dare –what are you, 10

you want horror stories–if you can’t find any then you truly are a bozzo

#74 S.B. on 03.15.11 at 10:52 am

Here’s an example from today. Green House Gas?
Is that like Acid Rain? Ozone Layer Hole? Cold War? Oat Bran? Any other media fads?

I’m telling you, hydro will be for the rich soom. Like in 2nd and 3rd world countries will will have rolling blackouts when “green” power goes offline or a small unregulated operator goes belly up.

See, the local politicians are selling our rights to private corps. all under the guise of “green power”. Remember Enron – human greed knows no bounds.

PEI is a have-not province with the one of the highest hydro rates in the country. Look what they are doing to them:

Charlottetown spends on green power
CBC News Posted: Mar 15, 2011 7:02 AM AT Last Updated: Mar 15, 2011 8:04 AM AT Read 0 comments Bullfrog Power
(Note:CBC does not endorse and is not responsible for the content of external links.)

The City of Charlottetown has signed an agreement with a company called Bullfrog Power to buy electricity from sustainable sources, at a premium of two cents a kilowatt-hour.

Councillors voted unanimously to accept the deal.

“One of the main goals of our plan is to reduce our green house gas emissions so we’re leading by example,” said Coun. Rob Lantz.

#75 Tkid on 03.15.11 at 10:58 am

Would anyone be willing to give the crayon explanation of why the price of gold and silver is falling? I thougt the price should increase during times of crisis?

Many thanks.

#76 HouseBuster on 03.15.11 at 11:05 am

FACT: Canadian real estate is done!

Dump your overpriced shacks while you still can.

#77 dude with cocaine problem? on 03.15.11 at 11:06 am

Is that the guy with the chopper?

I am curious who you’re referring to…..

*************************************
#67 Ottawa S on 03.15.11 at 10:21 am

I don’t know where HGTV finds these people. Scott McGillivray’s constantly running his fingers through his hair while he talks about how much cheap renos have added value to houses just outright annoys me.

Then there’s also another, who before his HGTV days was a lousy carpenter with a cocaine problem (don’t ask how I know)

HGTV really knows how to pick ‘em…

#78 Steven Rowlandson on 03.15.11 at 11:07 am

Hello Garth.
All booms end in a bust and that tends to wake people up out of their dream world and guess what? The criminals that people worshipped and admired are seen as what they are for the first time. It’s a story that old as the hills. The less than ethical who went for the quick buck and lied, cheated and defrauded are going to be exposed as this on going real estate reality check continues and it won’t stop there Garth. The world of government and finance has been in a bull market since the french and english revolutions and yes there has been mini reality checks along the way but the ultimate bear market and judgement day for banksters and politicians has yet to arrive. It should be interesting watch how the public reacts when the sins of their leaders can not be hidden and are made obvious to all.

Steven

#79 Dodged-A-Bullit-in Alberta on 03.15.11 at 11:15 am

Greetings: #49 [SquareNinja]: “Nuclear power just doesn”t make sense.”

I would be appreciative if you would support this statement by listing the alternatives for people living in JAPAN. No oil, no coal, no massive rivers etc.

#80 Utopia on 03.15.11 at 11:18 am

If anyone is not getting that a Canadian election is virtually a guarantee at this point then you really have not been paying attention.

This upcoming budget is probably the very last major event and moment in time that the parties might seek to battle it out on everything and on every topic EXCEPT the economy.

No such luck next year at this time.

Given enough extra time, that confused rabble we know of as the federal opposition parties might actually have real issues prepared and a chance at forming a government. Hell, they might even be prepared by then to mount a credible campaign.

In fact I will hazard to guess that by March of 2012 the economy will be the ONLY issue as Canadian R/E will have finally met its Waterloo and nobody in this sorry country will feel exempt or immune from our debt binge anymore.

For fun, lets just make June 18th election day to coincide with the 196th anniversary of Napoleans bad hair day. Who says we can’t have a debt hangover so bad it makes those Americans look downright sober next to a drunken sailors night-long binge on the town.

#81 Abitibidoug on 03.15.11 at 11:46 am

In response to #18 by Bottom’s Up: There may well be more gains ahead in some markets, but after a big run up in values there is more downside potential than upside, so it’s a higher risk buying now. The only exception would be housing in a depressed market such as a one industry town where the one industry has shut down and prices have already dropped significantly.

#48 by Values: You are so right. With the exception of a small segment of the population, we really are the stuff society. I wonder what happened to the hippies, who supposedly didn’t like all this excess materialism?

#82 Herb on 03.15.11 at 11:47 am

#60 Moneta,

The traffic is in the core and the core is easily accessible from the burbs. Why would I pay a million when I can get the same lifestyle for a third in the burbs?

Because you don’t want to spend an hour each way getting to your job in the core. Have a look at traffic on the 417 or Bronson at 8:30 AM and 3:30 PM on workdays.

I have a modest proposal to solve Ottawa’s traffic problems: make public servants punch time clocks. The afternoon rush hour starts no later than 3:30 PM, which implies people starting work no later than 7:30 AM to put in an eight-hour day. So why is there no traffic jam caused by people rushing to work at 7 AM?

#83 WINNIPEGER on 03.15.11 at 11:54 am

http://www.ctv.ca/generic/generated/static/business/article1941369.html

Comments??????????????

#84 Danforth on 03.15.11 at 11:55 am

The line “this will not end well” has always been mentioned in the spirit of predicting market dynamics.

It seems that Sayers is just a [email protected]$$, and his situation fueled by greed and lack of basic decency could have happened in all economic environments. His situation isn’t a “sign of the times”.

#85 Another Albertan on 03.15.11 at 11:57 am

Macrath:

Interestingly enough, I’m sitting in a meeting and across the table is one of my consultants. He used to work as a control engineer at Crystal River in Florida. Crystal River is a complex of 4 coal and 1 nuclear units.

I’ll try to get some colour commentary out of him, but no guarantees.

Everyone else’s mileage may vary.

#86 Values on 03.15.11 at 11:58 am

“CREA admits it: house prices likely to ‘recede'”

(They) screwed us.

Or that is what the last minute rush of greatest fool buyers will be saying.

Buyers in the last 2 months (even last year) should have known better, they were playing with fire and got burnt.

Sell it before it drops further.

#87 Ottawa S on 03.15.11 at 12:00 pm

#18 Bottoms_Up on 03.14.11 at 11:52 pm

Garth, for over 2 years you’ve been preaching ‘this isn’t going to end well’.
I challenge, no, wait, I triple dog dare anyone with a Canadian real estate horror story to step forward and tell their tale.
Hasn’t happened and won’t happen for some time. This tells me the top is not yet in.
There are gains yet to be had in the Canadian real estate market.

You want a real estate horror story? I got a story – not horror, but not great either.
My in-laws bought a nice lot of land in Oshawa with a shack on it for $155,000 in 2006. Market was booming, and plan was for my engineer-turned-carpenter husband to build his first house on it (he paid the down payment). It was rented for a few years at $650 a month, which is all the shack on it could rent for at the time. My husband paid the difference for a few years (some income property, eh?). In 2008, the market in the GTA tanked, especially in Oshawa. The In-laws tried listing the house last year, couldn’t sell without real losses, so took it off of the market. Early this year, they got a letter saying they would need to put down an additional $17,000 to renew their mortgage, due to the changing CMHC regulations and the fact that the bank probably knew it was worth less, so they were forced to sell. Despite the building boom in Oshawa, they could only sell for $144,000 (to a builder, no less). So in five years of increasing market, this small house on a nice big lot lost $11,000 in value, nevermind the selling fees my in-laws paid, and the money my husband put into it topping up the rent for the first few years and renovating a little. That’s proof that not every house increased in value over the last five years, and I’m sure there are plenty of other stories out there. There are still developers going bankrupt (I know of a project for sale in Ottawa right now). That kind of news just doesn’t make the headlines.

And here is another. Husband’s friend bought a house in a nice neighbourhood full of million dollar homes in Toronto for $450-500K (don’t remember exactly). Mother provided the down-payment, and he lived in it with roommates. Anyway, early 2008 he decided to gut the place and renovate it, as an investment. He was a carpenter. Summer 2008, market tanked and everybody stopped building, and builders stopped paying their carpenters. As a result, he ran out of cash, and started missing payments. Bank foreclosed on the house, listed it for $389K last fall, and sold it around listing price to a builder who tore it down and is currently building on that lot. Another story from someone that overleveraged to invest in real estate and lost money. That one I’d call a horror story.

#88 Fred on 03.15.11 at 12:08 pm

I see Garth continues to never see a good crisis he didn’t go all Chicken Little over.

I am buying Uranium stocks. Come back in a month and we will see who made the most rational decision.

Where on earth did I say ‘sell’? This is the kind of day when an investor with a balanced portfolio ignores the news. You diminish any valid points with exaggeration. Too bad. — Garth

#89 Paul on 03.15.11 at 12:12 pm

#58 Ret on 03.15.11 at 9:33 am
I love those shows showing basement income suites. Permits? Inspections? Ceiling heights? Fire code and electrical? Zoning compliance? They never address any of those issues.
So any tenant in one of these suites can walk at a moments notice. All they have to say is that the suite that you have rented to me is not compliant because of a building, fire or an electrical code defect.
Oh, and you can give me back all my post-dated checks and sign off on the lease as well, or shall I call the authorities about my concerns?

Wrong. You will lose badly and it will cost you lots if you walk.

#90 wetcoaster on 03.15.11 at 12:19 pm

The biggest misconception/fraud going is that doing renos to your house automatically makes it worth more. I fell for that ruse many years ago. All the splashy magazines told me so.

A couple years after a $10,000 kitchen reno and numerous other major fixups, new deck,carpets, etc, it added absolutley ZERO to my listing price. My house was in a nice neighborhood but the market was “balanced” as the so called experts called it, but the main fact was EVERYONE had done a major kitchen reno in the whole area and you listed at average market price only if you had done a reno. If you hadn’t you were knocked down 10% or so.

So for all you suckers thinking you added 10-20% because of a new kitchen or bathroom, dream on. You have to have added on a complete addition costing you a bundle to raise your price and you will most likely break even.

House porn indeed.

#91 VICTORIA TEA PARTY on 03.15.11 at 12:20 pm

OTHER TECTONIC PLATES ON THE MOVE TOO

While we all look with deep concern about the many issues ongoing in Japan, the world’s sick economy is looking a little more green about the gills this week.

Bloomberg reports:

‘Crude oil fell to a two-week low in New York as concern that damage from Japan’s earthquake may limit crude demand outweighed speculation of supply disruptions in the Middle East.

Oil slipped as much as 4.4 percent as a third explosion and fire struck Tokyo Electric Power Co.’s Fukushima plant. The earthquake on March 11 caused a tsunami that disabled critical cooling systems at the facility….“The unrest in Libya has been pushed to the back burner by the tragedy in Japan,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. “The third fire at the…plant is a sign that we’re looking at a longer-term problem, which will have a considerable impact on the Japanese economy.” ‘

Of interest is that ALL commodities are priced lower in today’s various markets. That is reminiscent of the 2008 market melt debacle.

The question is: how long will the earthquake-caused business disruption in Japan continue and how will it ultimately affect the rest of us? For example, the industrial supply chain has been broken in Japan; Toyota’s production is halted throwing a wrench into the “just in time” production lines that form around the world these days.

MID EAST TECTONIC PLATE

Meanwhile back in the good old Middle East the Saudis “invaded” Bahrain, a day or so ago, after being invited to do so by the Bahrain’s royal rulers.

Street demos in recent weeks, by the dominnant, though “suppressed” Shias living there, have posed a threat to the established order.

The online publication “Business Intelligence — Middle East” has this opinion about the real source of the unrest, Shia-dominated Iran, just across the Persian Gulf:

“…At the moment we suspect the Iranians do not know how they will respond. The first issue will have to be determining whether they can create violent resistance to the Saudis in Bahrain, to both tie them down and increase the cost of occupation.

It is simply unclear whether the Bahrainis are prepared to pay the price.

They do seem to want fundamental change in Bahrain, but it is not clear that they have reached the point where they are prepared to resist and die en masse.

…we expect the Iranians are in intense discussions of their next move. Domestic politics are affecting regional strategy, as would be the case in any country…

For the moment, the Saudis have the upper hand. But the Iranians are clever and tenacious. There are no predictions possible. We doubt even the Iranians know what they will do.”

Combined with the near-cessation of oil exports from Libya to downtown Europe, and all of the ongoing debt crises in the West, this is a most interesting time to be a witness to history.

To think that none of the above will impinge on the real estate biz in Canada is to court personal financial negligence on a huge scale.

Tectonic plates lie beneath the Earth’s surface but also in the Middle East’s politicial/cultural turmoil, and the banks and bourses everywhere else.

For Mr. and Mrs. Little People, getting rid of debt and curtailing “unnecessary” expenses, has probably never been better advice.

An investment in iodine tablets may be a precaution, if there are further nuclear power plant-destroying earthquakes and tsunamis in Japan’s future, followed by major leaks of radiation.

Meanwhile, on the ground in that country the suffering continues and nobody knows what’s next there. Or anywhere else.

#92 Dunand on 03.15.11 at 12:21 pm

Some weeks ago, I learned here about the real return bond ETF (XRB). I used it to rebalance my portfolio a month ago. This thing rocks. This is the perfect weapon against inflation and that thing soars when there is civil war, earthquake and china syndrome.

#93 Macrath on 03.15.11 at 12:21 pm

Danielle Park laments her association with BNN.

“I have not appeared on BNN now since November 2010. The fact is they have not asked me to appear. In December the Producers were asking me for buy ideas on the equity side and I told them I had none as our work suggested that risk assets across pretty much all global markets and sectors were dangerously overbought and at risk of significant price correction. My suggestions were high quality bonds, cash and the US dollar. They advised me that they were not interested in those comments and would like me to let them know when I had buy ideas for equities and commodities. (Nope no bias there; just balanced journalism folks). ”

Here we have yet another reason to boycott these cretins.

#94 S.B. on 03.15.11 at 12:22 pm

Here we go, power costs set to skyrocket. They never let a good crisis go to waste, those Globalists.
The days of cheap hydro and 1st World luxuries will be but a dream for some, soon, as we are relegated back to 2nd World country status and technology.
—–
Germany will shut down all seven of its nuclear power plants that began operating before 1980 at least till June, the government said on Tuesday, leaving open whether they will ever start up again after Japan’s crisis.

Chancellor Angela Merkel announced the closures, which will leave only 10 nuclear stations still generating, under a nuclear policy moratorium imposed as Japan faced a potential catastrophe at its earthquake-crippled Fukushima complex.

#95 landlord22 on 03.15.11 at 12:32 pm

71 Ottawa S on 03.15.11 at 10:39 am
#53 landlord22 on 03.15.11 at 7:56 am

Garth, I am surprised you are not more enthusiastic about homeowners having an income suite. Sacrifcing a bit of square footage in exchange for reduced mortgage payments and extra tax deductions seems reasonable to me. It may be about staving off bankruptcy in some cases but not everyone is overleveraged and not able to make their mortgage payments.

Most people I’ve seen on “Income Property” are short on cash and desperately need the income. So they are being encouraged to borrow another $10,000 to $40,000 to bring in an extra $800 a month. Where is the sense in that? Borrow to generate cash flow? If you are that tight on cash that you can’t afford your house, sell it and rent for a while. And I have not seen the show talk once about tax implications (you have to declare the income to be able to capitalizing the expenses).

I watch the show as well and my impression is a bit different. I don’t think the majority are renting the income suite because they need to or they will be sunk. I think they likley purchased their property knowing the benefits of lower monthly housing expenses. You have to look at the numbers in each particular case of course but some renovation costs up front may be beneficial looking at the big picture. I know in my case, I pay less in housing expenses than I would be able to rent a comparable apartment for and my net worth is better than when I was a renter.

#96 Fred on 03.15.11 at 12:33 pm

Garth,

As per your comment to my previous post.

What part of:
“As of this morning oil has plunged $4 a barrel, gold’s tumbled $20, the dollar is off two full cents, the Nikkei collapsed 10.6% and global markets are following suit.”

Did I not understand? By that “the sky is falling” statement you are implying this is some sort of long term trend. In a month or two it will be seen for what it is. Nothing but a short term blip.

So you can follow the herd and panic or you can do what I am doing which is looking for buying opportunities. In particular check out “UUU”. Down 40% in the past couple days even though there has been no long term change in the companies outlook.

It’s days like this I thank god for herd mentality and the fact I can see beyond it. I also appreciate you doing your part in driving the herd.

Don’t try to validate your previously incorrect statement by being an idiot. My comments on market indicators were utterly factual, and I made but one point: the wisdom of a balanced portfolio. Try again. — Garth

#97 The Original Dave on 03.15.11 at 12:38 pm

I see Garth continues to never see a good crisis he didn’t go all Chicken Little over.

I am buying Uranium stocks. Come back in a month and we will see who made the most rational decision.

Where on earth did I say ‘sell’? This is the kind of day when an investor with a balanced portfolio ignores the news. You diminish any valid points with exaggeration. Too bad. — Garth

————————————————

He didn’t flaunt anything. He is right about the balanced portfolio during days like this and you’re right about uranium stocks – although I wouldn’t give 1 month as a time frame, could be several months.

#98 Macrath on 03.15.11 at 12:43 pm

#85 Another Albertan

The interesting part of that study was that the geologists were able to predict an earthquake, near Istanbul ,to within a couple of weeks using their methodology.

#99 City Slicker on 03.15.11 at 12:47 pm

#75 Tkid on 03.15.11 at 10:58 amWould anyone be willing to give the crayon explanation of why the price of gold and silver is falling? I thougt the price should increase during times of crisis?

Many thanks.
———————————————————
Panic/emotional selling effects everything at first. When markets recalibrate money goes where it should.
Happen in 2008 big time.

#100 GregW, Oakville on 03.15.11 at 12:50 pm

Some links, with links, to more information about the Japan nuclear troubles. (If your interested).
http://spectrum.ieee.org/static/japans-earthquake-and-nuclear-emergency
http://www.aecl.ca/NewsRoom/Articles/Monitoring_the_Situation_in_Japan.htm

#101 pjwlk on 03.15.11 at 12:59 pm

Gains in house prices are likely to “recede” starting next month as shorter mortgage terms keep some buyers out of an already softening market, the Canadian Real Estate Association said Tuesday.

Globe and Mail

#102 The Original Dave on 03.15.11 at 1:00 pm

another point for the person that was ridiculing uranium- that’s likely what the french do when they see some crazed Middle-eastern dictator cutting off oil supplies. France gets roughly 79% of it’s energy from nuclear.

And for the tree hugger that hopes hugs, kisses and sunshine can be a form of base load energy, you don’t seem to appreciate the computer screen you’re reading off of….or your lights, fridge, stove etc. There’s parts of the world that aren’t as fortunate as us to have a great energy grid that people can take for granted. I suppose your solution to their needs is to build millions and millions of windmills (hopefully in a windy area).

Matt Simmonds explained the oil situation perfectly. 85 million barrels a day is what the world has to work with – that’s assuming that the current output out of Ghawar and the 2 other major oil fields in Saudi continue at current output. That is also with China and India at current consumption rate. Do some deducing and realistically tell us how those that demand energy for refrigerators in their home will get some.

For those that are that anti- nuclear, if you live in Ontario, realize that over 50% of our energy comes from nuclear (I believe it’s 65%). It’s been this way for decades. My suggestion is to lead by example, and get off the grid.

Disasters will happen. There’s no perfect energy source. We need a big mix of the big 3 energy sources. Investment wise, I’d choose the one that was neglected and hated for decades.

#103 prairie gal on 03.15.11 at 1:06 pm

#70 SB:
OK now I know you are woefully misinformed.

Re: ozone layer – there is still a large gap in the Southern Hemisphere, where skin cancer is a big problem. However, the Montreal Protocol was successful in almost eliminating CFCs, and there has been a marked increase in atmospheric ozone over the past two decades.

Re: Acid Rain –
There is a very effective bilateral agreement between Canada and the US regarding acid rain in the Toronto-Detroit area from manufacturing plants. Measures were taken to reduce SOx and NOx emissions from these facilities and the rain pH improved.

Acid rain is a growing issue in areas where SOx is unregulated, as in the oilsands development. There has been a gradual acidification in Northern Sask due to oilsands emissions. The respective governments are aware of the situation.

#104 Utopia on 03.15.11 at 1:13 pm

#50 Brian1 from yesterdays post (Balance) wrote..

“Utopia: I know you sincerely feel for the Libyans and that is a good thing. I am going read your blogs again but I think that we should not be without genuine Muslim participation”

———————————————————-

Thanks Brian, I am not a Muslim but appreciate the consideration and the offer of inclusion on this site. The fools of the past few days who raised objections to my comments are for the most part people who have no real knowledge or connection to the Middle East or North Africa. I know that intuitively from the comments they left.

I do have some experience though. I have lived there extensively and am intimately familiar with the conflicts. I have taken the trouble to gain fluency in three semetic languages of Arabic, Hebrew and Amharic.

I survived a Katyusha Rocket attack in Metulla, witnessed first-hand dog-fights over the Golan, have had tea with the Bedouin in nondescript Dead Sea villages of Jordan and lived full time in Gaza. I almost got blown up walking through a field of land-mines in Lebanon too before the military intervened (which is what prompted me to learn to read Arabic in the first place!)

I do not come to this site speaking out of both sides of my mouth and I have always endeavored to speak the truth honestly. I seriously considered dropping out after reading the ignorant comments of two days ago though.

I was accused of pumping the mainstream message which was astonishing to me. I don’t watch it. Ever. I don’t even own a TV for crying out loud (by choice). I rarely listen to radio and in fact live in almost a complete media vacuum other than my laptops.

What this tells me is that when my message matches the media on a major issue like this is that I am on track with others who have also lived a lot of their life in the Mid-East. So I am in tune with what is taking place there, not a news re-hasher.

My detractors can reflect on their own deficiencies first before calling me to account. I will bet none of them have any first-hand knowledge of the region nor have they ever travelled there except through the benefit of a TV screen.

Instead, they have allowed the public misconceptions of the Muslim world as presented by CNN cloud their thinking to the extent that they actually believe they know the world when in fact they do not.

What they probably need is a trip to a real war-zone to start opening their eyes to the reality and the seriousness of the situation over “there” in Libya, Bahrain, Egypt, Jordan, Israel, Gaza and many of the other storied places that only exist in their imaginations as short clips on the Six-O-Clock News.

So I have not therefore come by my observations of the world casually and I do feel confident of my ideas to help resolve the Libyan crisis. I believe very strongly that if the West does not act decisively and proactively now that we will ultimately become embroiled in a land war there and that is just not acceptable.

OK. That is out of my system. Back to the markets for me.

#105 March of the Pigs on 03.15.11 at 1:47 pm

#79 Dodged-A-Bullit-in Alberta

Tidal power, they’re surrounded by ocean. A Strange time to talk about tidal power but there it is.

#106 March of the Pigs on 03.15.11 at 1:48 pm

and don’t tell me they can’t do it. I have a phone in my pocket a million times more powerful than my first computer.

#107 Roial1 on 03.15.11 at 1:49 pm

#70 S.B. on 03.15.11 at 10:37 am

“Do you have a short memory? What about the alleged Ozone Layer hole? Repaired itself?”

I don ‘t know just where you are getting the idea that the ozone layer is repairing itself.
Ever watch the weather channel???

That UV index is to show just how bad it is EACH DAY!

It is NOT gone away.

It is getting worse and will for many years. So, P-L-E-A-S-E go out in the sun and get skin cancer.

Then deny that.

Garth, Why do you let the insane post “ad nauseum” here. This guy will be back to “Flat Earth”in no time.

#108 March of the Pigs on 03.15.11 at 1:53 pm

#70 S.B.

do you thunk that maybe all the melting ice caps are causing the tectonic plates to move? I’ve been on this planet 32 years but I don’t remember this many “natural” disasters happening so frequently

#109 March of the Pigs on 03.15.11 at 2:00 pm

#38 Whistler Dude

I think they’ll head for the east coast…

#110 Edmontonian on 03.15.11 at 2:05 pm

Interesting posts here:
As far as Nuclear goes in Alberta, they talked about doing a plant in Peace River Area. It turned out I believe coal interests won out and the Government gave tens of millions toward “clean coal” patents for private interests rather than give money to “private Interests” for the Nuclear as the People of Peace River didn’t want the power plants-they Gov’t would lose votes!
Maybe our government will give massive subsides to the RE market, both builders & construction to keep it from plunging here in Alberta. This way there would be no money left for Health Care & they could privatize ahead as they conservative government tried in the 1990s in Alberta but was fined by Cretiene Government for breaking the Healthcare act. I believe if the Harper Governemnt won a majority changes to the Healthcare Act would allow it to be completely privatizied quickly.
A private healthcare system being brought in would send houses prices isn the crapper further do to tthe lack of disposible income from families. Services would probably quickly be delisted, forces us to pay private clinics as public ones wouldn’t provide certain servicea anymore.

#111 Moneta on 03.15.11 at 2:15 pm

Because you don’t want to spend an hour each way getting to your job in the core. Have a look at traffic on the 417 or Bronson at 8:30 AM and 3:30 PM on workdays
——-
People complain about traffic in Ottawa but it’s a farce. It does not take 1 hour. Much less.

#112 Kitchener1 on 03.15.11 at 2:31 pm

Garth– hope you were wearing your helmet today. tough day in the markets.

Japan has seen the light and have finally suspended trading on the nikki for the rest of the week. Ill be suprised if they honour all trades that happened yesterday.

To the guys in the FX markets today– dont forget to tip your barber for that nice mr. clean hairdo that you got.

What happens next remains to be seen. Fallout will be big- Japan will no longer be buying US bonds for the foreseeable future.

remeber folks, stay diversified, during the market last night and today, even bonds were selling off. For the gold/silver bugs, some serious flash crashes took out support. In a down market, trader will sell whatever they can to cover margins.

#113 Gregor Samsa on 03.15.11 at 2:56 pm

#12 Elmer wrote: Surely you’re not suggesting shows such as these are responsible for stupid people getting in over their heads in debt?

I have some essential “deprogramming” for you, courtesy of Charlie Brooker. As he points out in a hilarious manner, networks like HGTV promote an “aspirational culture” where everybody is programmed to want crap they don’t need. That includes the suburban McMansion (under renovation).

http://www.youtube.com/watch?v=CP6L5S14ygY

#114 Article on 03.15.11 at 3:27 pm

Is it just me or does it seem that the wording below in brackets was not meant to make it to the printing press.

I’m refering to this “(don’t worry, a list of reasons why not to worry follows)”. It’s seems like these are the reporters notes and they were suppose to be removed from the article. I could be wrong but it seems this way to me especially since the reasons not to worry are above that section.

If so, that’s pretty funny. It seems the reporter has to communicate “don’t worry” before printing the article like he is not suppose to be negative on the real estate market.

Any comments?

http://www.ctv.ca/generic/generated/static/business/article1941369.html

The report also outlined reasons Canadians should be concerned about rising prices (don’t worry, a list of reasons why not to worry follows):

Canadian home valuations look stretched, with “the average estimated asking rental yield at all time lows. Housing affordability looks relatively good, but will likely to decline as mortgage rates are set to rise and lending rules are tightening.”
Canadian home ownership rates are near record highs of close to 70 per cent, and real estate assets are near a record 38 per cent of household assets.
Canadian mortgage-debt-to-disposable-income reached a record high of 93 per cent (similar to the U.S.).

#115 TheBigLebowski on 03.15.11 at 3:29 pm

QE3 is on its way, the quake will be blamed for its need, not the fact that the Fed has been completely incompetent since its inception a century ago. The liquidation in the markets of all things tangible is nothing more than the Hedge Fund Algorithm black box tradings being triggered. The long term trend in U.S treasuries to the downside will resume and the upside in tangibles.

#116 BAD on 03.15.11 at 3:35 pm


#107 March of the Pigs on 03.15.11 at 1:53 pm wrote
#70 S.B.

do you thunk that maybe all the melting ice caps are causing the tectonic plates to move? I’ve been on this planet 32 years but I don’t remember this many “natural” disasters happening so frequently.

In Geologic time scale 32 years is a negligible time indistinguishable from say a picosecond.

In the geologic time scale the plates are constantly moving and colliding creating mountains and rift valleys including the Great Rift Valley where human species originated.

BTW, the earth has gone through much hotter and much colder periods than the current one. It seems to me that this planet and its life will survive long after the human species goes the way of the dinosaur. And that’s regardless of what triggers our demise: global warming, tectonics, asteroid/comet collision, disease, housing crash or something else.

#117 Dodged-A-Bullit-in Alberta on 03.15.11 at 3:50 pm

Greetings: #104 [March of The Pigs]

Re: tidal power

There is no known economical method of storing electricity at this time. If you have ever been in a huge industrial complex [which I doubt] you would recognize the vast amounts of current drawn by the machines. There are electric motors bigger than my pick-up truck. The AC on a residence draws huge amounts of amps in comparison to the flat screen TV. The electric motors on one elevator system would use more power than your whole house, as would a series of irrigation pumps watering a field. Walk into an aircraft maintenance hangar, or a city bus maintenance building and see the amount of electricity being consumed. Watch an electric railway system and imagine the volume of power required. Tidal system my arse!!!!

#118 BrianT on 03.15.11 at 3:59 pm

What isn’t mentioned much with this Japan story is how expensive energy is sucking the life out of the global economy. A lot of the costs are not being directly expensed, a lot of the liabilities are “off balance sheet”. Both this disaster and the gulf oil spill bear huge costs for the overall economy that are not included in energy costs by economists.

#119 househunter on 03.15.11 at 4:02 pm

#76 HouseBuster – Dude, who are you kidding? BoC will have to grow a set before that happens. This train aint slowing down until the rates start speeding up. Look at the world today. Rates are not going anywhere. Vancouver’s market is off the charts and will remain so until rates rise.

#120 Abitibidoug on 03.15.11 at 4:02 pm

Response to #112 by Gregor Samsa:
Although I didn’t watch the entire video, it was entertaining and some measure of truth to it. However, it’s up to YOU the consumer whether you want to believe all the trash you see and hear on TV. Myself I press the mute button as a reflex when the ads come on, before even realizing what I’ve done.

#121 jess on 03.15.11 at 4:09 pm

“Instead of addressing the fragile nature of Canada’s job market, we have a federal government fixated on high-priced security purchases such as fighter jets and new jails, along with maintaining expensive corporate tax cuts with questionable job creation benefits,” said David Macdonald, coordinator of the report for the CCPA, at a news conference in Ottawa.(cbc)

…lock em up and throw away the key ….
invest in the prisons for profit model . Out source the out sourced and why not the executioners too hell…..that compassionate killing drug is in short supply and very expensive. Bring back the noose.

Afterall, jails who employ prisoners who then make the “parts” for the missles and planes at 23 cents /hr.
defense market = private contractors + private prisons = shareholder value $$$$$$$$$$ right ?

mr. market will fix anything.

#122 JJ on 03.15.11 at 4:09 pm

http://www.donrcampbell.com/this-past-weekend-changed-my-thinking-about-alberta-real-estate

Now he’s an economist. — Garth

#123 xindai shan on 03.15.11 at 4:12 pm

Gregor,

THANKS very much for posting the link. It is very on topic, thought provoking and funny.

#124 Vancouver_Bear on 03.15.11 at 4:27 pm

“What you are seeing in Japan today is what you will also see in our future. Except they are better prepared than we are,” added Yeats, of Oregon State University.

See full article: http://news.nationalgeographic.com/news/2011/03/110311-tsunami-us-nation-earthquake-japan-hawaii-science-california-waves/

Ppl paying millions for houses here are simply idiots and retards, when the big one hits (my prediction it will hit in 5-7 years) they will quickly learn how it was hard to live in the Stone Age (if they are lucky to survive). We are not prepared for the big one, 95% of buldings here will not withstand magnitude 9 and collapse. Richmond’s soil will simply liquefy and slide into the ocean. Loss of lives unfortunately, will be in hundereds thousands. I am getting the hell outta this delusional pot smoking city.

#125 March of the Pigs on 03.15.11 at 4:35 pm

#115 BAD on 03.15.11 at 3:35 pm


#107 March of the Pigs on 03.15.11 at 1:53 pm wrote
#70 S.B.

do you thunk that maybe all the melting ice caps are causing the tectonic plates to move? I’ve been on this planet 32 years but I don’t remember this many “natural” disasters happening so frequently.

In Geologic time scale 32 years is a negligible time indistinguishable from say a picosecond.

In the geologic time scale the plates are constantly moving and colliding creating mountains and rift valleys including the Great Rift Valley where human species originated.

BTW, the earth has gone through much hotter and much colder periods than the current one. It seems to me that this planet and its life will survive long after the human species goes the way of the dinosaur. And that’s regardless of what triggers our demise: global warming, tectonics, asteroid/comet collision, disease, housing crash or something else.

I’m not sure about you but I can only account for the actual time I have been on this planet. I guess you have some other lives you need to account for

#126 March of the Pigs on 03.15.11 at 4:38 pm

#116 Dodged-A-Bullit-in Alberta on 03.15.11 at 3:50 pm

Greetings: #104 [March of The Pigs]

Re: tidal power

There is no known economical method of storing electricity at this time. If you have ever been in a huge industrial complex [which I doubt] you would recognize the vast amounts of current drawn by the machines. There are electric motors bigger than my pick-up truck. The AC on a residence draws huge amounts of amps in comparison to the flat screen TV. The electric motors on one elevator system would use more power than your whole house, as would a series of irrigation pumps watering a field. Walk into an aircraft maintenance hangar, or a city bus maintenance building and see the amount of electricity being consumed. Watch an electric railway system and imagine the volume of power required. Tidal system my arse!!!!

Computer systems used to be the size of a room!!!

I guess there was profit in those…

#127 Devore on 03.15.11 at 4:40 pm

#75 Tkid

Would anyone be willing to give the crayon explanation of why the price of gold and silver is falling? I thougt the price should increase during times of crisis?

When volatility is up, and investors are looking for safety, why would gold be up?

#128 March of the Pigs on 03.15.11 at 4:43 pm

Da Vinci was drawing planes 400 years before they were able to fly, the technology existed back then only we didn’t know how to use it. Now technology changes so fast 400 years is nothing. Just say YES!!!

It’s like the Reagan years only the opposite you remeber those don’t you…

#129 March of the Pigs on 03.15.11 at 4:44 pm

“remember” sorry got a bit excited… YES!!!

#130 March of the Pigs on 03.15.11 at 4:45 pm

You old fossils have done enough, we’ll take it from here…

#131 BrianT on 03.15.11 at 5:06 pm

#115BAD-IMO the average person is slowly (very slowly) starting to realize the limits to our tech prowess and the inability of the “experts” or “leaders” to actually deliver on the endless promises. I don’t know how many readers are old enough to remember when humans were going to explore the universe and technology was going to bring a brave new world, but that party is finished-now we are left with just the hangover. Earth is becoming a Planet of Slums-it isn’t surprising that rich Chinese would feel Vancouver is beautiful-China is a huge polluted toxic waste dump (and this is one of the most important economies to our vaunted global system).

#132 Hoof - Hearted on 03.15.11 at 5:12 pm

#17 freedom_2008

Hey dude thanks…..awesome clip

David Ingram tax exposes’ are great.

Our in-laws had a small weekend place in the US, 20 minutes across the border. Sold it, didn’t pocket much after owning it for 25+ years , a US citizen bought it.

What Ingram exposes is simply Big Brother raping and pillaging to squeeze any/every nickel it can. Sign of things to come.

Everyone should watch these videos.

One mind blower is simply being in the US for a certain combined total of day over a few years can force one to pay income tax on global income even if you didn’t make a penny in the US.

#133 Hoof - Hearted on 03.15.11 at 5:21 pm

#90 wetcoaster

Exactly

I don’t know how many renovated homes I have seen that easily invested $100,000 + but ended up demolished.

In Vancouver, the Sun newspaper this week had a photo of a house that spent $500,000 in renos, sold and is scheduled to be demolished.

I still chuckle at a builder I know…who insisted a used rose coloured bidet from a renovation was worth several hundred dollars

It’s imply mind candy for the masses

#134 Increasing that 1% on 03.15.11 at 5:31 pm

These are charges made against Anthony Sayers, – made by a woman that could be doing to him some of what she’s accusing him of, who knows–he’s had no trial- he’s not been convicted.
His livelihood currently is linked to his reputation in the public eye yet that’s been smeared already

Lesson: Placate unhappy customers before they call the cops. — Garth

#135 two sides to every story on 03.15.11 at 6:09 pm

re #133 Increasing that 1%…..there are lots of demanding and psychotic clients out there….you could be an awesome contractor, skilled and honest, and end up in the weirdest disputes.

I’ve seen it happen to others and it’s happened to me.

Garth’s advice to “placate unhappy customers before they call the cops” is sound….but sometimes you just can’t placate them :(

I have never even heard of Anthony Sayers so I am not commenting at all on this incident. Just pointing out that it can get weird out there.

#136 March of the Pigs on 03.15.11 at 6:21 pm

We can only do better by the look of things these days. Time to hit the oxygen tank and zone out, puff puff pass

#137 dd on 03.15.11 at 6:27 pm

Update:

…Meanwhile bond yields have dropped sharply and prices surged as investors scramble to find safe haven…

Wow gold is off $20? Next time why don’t you mention when it sky rockets to be fair.

Because it makes a lie of the oft-repeated statement that gold supercedes US Treasuries in times of turmoil. It does not. Gold is a pure speculative play. — Garth

#138 poco on 03.15.11 at 6:29 pm

#123 Vancouver_Bear–re earthquake zone and the liquefaction of Richmond
i understand that the Municipality of Richmond has recently purchased new numbered door plaques in the event of such an incident –all highrise condo suites numbered 900 and up, will now get a new plaque for their door numbered 100 and up

#139 Hoof-Hearted on 03.15.11 at 6:30 pm

Two weeks from today the Scott McGillivray Real Estate Success Academy makes its next Canadian stop, this time in the gorgeous Saskatoon Inn, conveniently close to the airport, amid that giant atrium full of exotic dusty plastic plants. Billed as “The Insider’s Edge”, the TV host has personally invited the locals to come out and see how ,”smart investors are making millions from tax deed auctions, foreclosure flips and pre-auction events.”

“I am personally inviting you to attend,” he says, to learn how to “buy property for pennies on the dollar… cherry-pick the best properties before the public has access to them… and purchase at rock bottom prices before they are bid up by hundreds of other investors.” And absolutely no attempt has been made to Canadianize this US house lust gig, with main sponsors being Bank of America, Chase and Citibank – companies with an endless supply of US foreclosed homes nobody wants.

============
OK…save your $$$$

Same scam simply warned over….

What they do is give a free seminar……throw out enough bait…use a few examples….then get you to line up for the weekend seminar say $250…..but a special deal if you sign now…only $145 !

If you sign a list ( like I did, but walked out), they will call you….claim it was sold out but they have a few openings or they are putting on another seminar due to popular demand.

Again….ignore them and their snake oil pitch.

#140 Chaos on 03.15.11 at 6:30 pm

Vlad…

google: endoftime2012.com

It’s definitely way above my pay grade…

But if you can sift through the whole of it you will find some nuggets in plain english that will scare the crap out of you.

Niburu, the Brawn Dwarf, as in brawny. Apparently arriving in 646 days.

#141 AACI Home-dog on 03.15.11 at 6:31 pm

# 90: Wetcoaster
#130: Hoof Hearted

Of course it is true that renos only add value to a property by only a fraction of their cost….consider that kitchen reno….what is the first thing done ? You remove the old (still functional) kitchen. So, you have immediately dropped some value right there.
Also, you are assuming the reno you have selected is suitable to the buyers taste…which may well be an error.

#142 bigrider on 03.15.11 at 6:31 pm

I swear on my life I am not making this up.

Just talked to a guy. Wants to take a leverage loan out to purchase some financial assets of which he has very little, on his fully paid house valued at 800k, amount he wishes to borrow is 100k. He has various concerns about the direction of stock markets, silver and gold etc etc and is terrified of losing 20 to 30% on his investment and hence his reluctance to deal with the fee only planner he is dealing with.

Here is the rub. He owns 7 rental properties all with minimal down ,3 of them CMHC insured, all cash flow positive so he says and he “sleeps soundly as a baby” doing so ,his exact words after I alerted him to the various risks that he is under. Yes he is Italian.

Infuriating perception to say the least.

Real estate is a religion.

#143 dd on 03.15.11 at 6:38 pm

Massive money printing coming from Japan, US, and Europe. QE to infinity.

Ultimately backed by taxes. — Garth

#144 Hoof-Hearted on 03.15.11 at 6:41 pm

#134 poco

No…you got it wrong…anything higher than that gets a sign ” SOL “…

BTW…check your insurance.
You would be surprised how bad it could get depending on your circumstances .

#145 dd on 03.15.11 at 6:55 pm

#137 dd

…Because it makes a lie of the oft-repeated statement that gold supercedes US Treasuries in times of turmoil. It does not. Gold is a pure speculative play. — Garth…

The dollar has barely bounced with this latest turmoil. Your arguments are based short term movements. Nothing more.

Based on the long-term trends –
Fact: long-term depreciation of the US dollar continues.
Fact: Worldwide deficits are at historic highs.
Fact: Massive money printing continue to cover deficits.
Fact: long-term appreciation of gold continues.

These are facts. Look at the graphs of deficts, debt, M3, and gold to prove it.

#146 Hoof-Hearted on 03.15.11 at 7:01 pm

#126 March of the Pigs on 03.15.11 at 4:38 pm#116 Dodged-A-Bullit-in Alberta on 03.15.11 at 3:50 pm

Greetings: #104 [March of The Pigs]

Re: tidal power

There is no known economical method of storing electricity at this time.
_===========

Just via trivia there is.

Excess capacity can be “stored” via generation facilities such as dams that may have low useage time but can’t shut down.

The surplus power is used to compress air in a deep cavern. This compressed air can then be released to run a turbine.

#147 Canada housing market CRASH on 03.15.11 at 7:15 pm

The housing market is crashing harder then the realtors are letting on. Sales DOWN AGAIN for the 10th month in a ROW. Yup sales were down every month since June and prices are also down. How? Well you see homes that sold for 600K now sell for 500K but the average is up since more 500K homes where sold since people thought they got a steal paying 500K for a $600K house. To think February was the last remaining month for greater fools to rush into their slaughter. Realtors can spin and lie but the fact is CREA is now giving hints that “Gains in house prices are likely to “recede” starting next month as shorter mortgage terms keep some buyers out of an already softening market, the Canadian Real Estate Association said Tuesday” . How nice of them to tell the masses three days before the deadline. Those who bought with the realtor with the fear of “buy now or be priced out forever” will suffer great losses before they walk into their new economic prison. What realtors should be saying if they were honest or had an education in economics is wait now and pay less later. The housing crash is only going to get worse.

POP……………….

Realtors………………..buy now or………What??? Gains in house prices are likely to “recede” starting next month. I don’t understand??? remember i don’t have a real education.

Greaterfools………….I will be losing money every month I “own”? I will lose money before I walk into my home?

Mortgage brokers………..I just pooped my pants.

#148 Bruce on 03.15.11 at 7:24 pm

I had to laugh at the sign hanging on the window at Scotiabank today: “Borrow to Get Ahead”… What a paradox!

#149 jess on 03.15.11 at 7:41 pm

Hoard of cash lets Qaddafi extend fight against rebels New York Times
Mar 15 – U.S. Justice Department documents show that Libya had worked with Swiss banks to launder international banking transactions for years, with “hundreds” of senior Libyan officials allowed to surreptitiously move money.
===========
Dear Mr Voser,

RE:DISCLOSURE OF PAYMENTS BY EXTRACTIVE COMPANIES ON A COUNTRY-BY-COUNTRY BASIS

I write to you in my capacity as a Member of Parliament in Uganda and Chair of the Ugandan Parliamentary forum on Oil and Gas.

I was disturbed to hear of comments attributed to you at the Extractive Industry Transparency Initiative conference held recently in Paris. You appeared to suggest that mandatory reporting requirements ensuring oil, gas and mining companies disclose the payments they make in each country of operation would in some way breach the sovereignty of producer countries. Let me assure you as a citizen and representative of Uganda this is not the case. In fact we celebrated the passing of the Dodd-Frank Act in July and are actively looking forward to counterpart legislation in the European Union, not least because the companies in operation here are not New York listed. As a non-EITI candidate country the need is even more pronounced.

I’m sure you will know that our country has recently discovered large quantities of oil. It has the potential to significantly accelerate economic and social development. This oil belongs to the people, not to political and business elites. Sovereignty can only be enhanced by empowering people with the type of information which the Dodd-Frank Act will provide – information that citizens of many countries take for granted….”

=
http://www.taxjustice.net/cms/front_content.php?idcat=140
http://www.hindustantimes.com/Rs-1L-cr-unaccounted-wealth-brought-under-tax-net-FM/Article1-673373.aspx

#150 morry on 03.15.11 at 7:41 pm

@#65 Moneta:
You need to get a life and get out in the world.

#151 canadian down under on 03.15.11 at 7:46 pm

#18 – here is my story:

Bought home in Calgary, November 2006 for $710K. Sold in May 2010 for $680 (to take a 2 to 4 year transfer to Brisbane). Add r/e fees, plus sinking $10K into the house and we lost around $65K. Sucks – but fortunately we can recover fairly quickly.

Here is the real kicker – a comparable (except that they did not have a triple garage) listed at the same time for approx $675 and for whatever reason, did not sell. Relisted recently (I follow the Calgary market for when we return) at $599 – and it is still sitting there.

Yes – there has been some real estate pain in Canada!!!

Must say – this is the first time we have ever rented (early 40’s) – and I am really enjoying all the extra family time we have!! Depending on how the numbers look when we return – I will very seriously consider renting back home. The lifestyle is fabulous!

#152 morry on 03.15.11 at 7:50 pm

@#124 Vancouver_Bear

if you need me to pay for your bus ticket let me know. otherwise leave already.

#153 Nostradamus Le Mad Vlad on 03.15.11 at 7:57 pm


#116 BAD — Good post. Melting ice caps causing tectonic plates, etc.? I’m not that intelligent, but with tectonic plates usually a few floors below sea level, it would be strange to see melting ice caps (which they are not) causing ‘quakes.

Then again, I’m a man so I don’t know very much!

#140 Chaos — “Niburu, the Brawn Dwarf, as in brawny. Apparently arriving in 646 days.”

The karmic speed of time is in overdrive now, so it’s a little less than two years.

2012 — fuggedaboudid. Dec. 24, 2011 is the end of the Mayan age, with the Incas and Aztecs a little later. The Causasian race is finishing up and the cycle is changing to the Yellow / Red races, the Roman Catholic Church is almost gone (one more pope after the present one), so there are a basketful of changes coming.

Whoa baby, things are sure heating up down here!

#115 TheBigLebowski — “QE3 is on its way . . .” and #143 dd — See Chart Japan only has to cash in on its US treasuries to rebuild itself. What would happen to the States then, with all the wars they are perpetuating?

#154 morry on 03.15.11 at 7:58 pm

#142 bigrider

I know at least ten italians with at least 4 houses each. A majority of them have no mortgages left on their properties. I see them laughing and going on vacation a lot.

Most of them have no big pensions and no investments. They don’t pay any fees to anyone.

the irony: mostly skilled labours and self-employed.

MILLIONAIRES they are MANY times over.

#155 Alex on 03.15.11 at 8:12 pm

This has probably already been posted, but DAMN – an inkling of truth from the CREA? Did the world end and did I miss it?

http://www.theglobeandmail.com/report-on-business/economy/housing/house-price-gains-likely-to-recede/article1942385/

#156 Daisy Mae on 03.15.11 at 8:15 pm

“Of course it is true that renos only add value to a property by only a fraction of their cost….consider that kitchen reno….what is the first thing done ? You remove the old (still functional) kitchen. So, you have immediately dropped some value right there.
Also, you are assuming the reno you have selected is suitable to the buyers taste…which may well be an error.”

I read years ago that a ‘faucet is a faucet’. It does not matter if it’s chrome or gold….it’s just a faucet.

#157 dd on 03.15.11 at 8:15 pm

#143 dd on 03.15.11 at 6:38 pm

…Massive money printing coming from Japan, US, and Europe. QE to infinity. …Ultimately backed by taxes. — Garth..

Ultimately backed by inflation. The “hidden” tax and the greatest wealth transfer.

#158 cynic with a long view on 03.15.11 at 8:32 pm

#143

Massive money printing coming from Japan, US, and Europe. QE to infinity.

Ultimately backed by taxes. — Garth

You have GOT to be kidding me?!?!

#159 dd on 03.15.11 at 8:50 pm

#154 Nostradamus Le Mad Vlad

“QE3 is on its way . . .” and #143 dd

Interesting. I bet the Japanese bill will be a least a trillion when this is through. If they are lucky. Let hope they are.

#160 Utopia on 03.15.11 at 8:53 pm

#75 Tkid asked….

“Would anyone be willing to give the crayon explanation of why the price of gold and silver is falling? I thought the price should increase during times of crisis”?
———————————————————

Precious metals are still commodities. Silver in particular is vulnerable to commodity weakness due to its position as an industrial material. The crisis you mention is not one leading to severe inflation let alone hyperinflation that might propel an alternative currency like gold forward. On the contrary, deflation fears are rising again. Further, the US dollar is widely anticipated to rally which will scuttle Gold for the time being. That is only the beginning of an explanation. Hope it helps.

#161 poco on 03.15.11 at 8:53 pm

#144RE 4 Eva–“Lets talk about real facts.”–RE prices have been going up. Sorry. That info has been documented.
Just another pumper with nothing to back it up
-here’s a fact for you –tri-cities–of all price changes from my e-mails today–27% of these properties are selling for less than the seller paid –you figure it out
stick that in your pipe and smoke it–down -down -down
don’t you love how stats can screw things up

#162 Devore on 03.15.11 at 9:00 pm

#157 Daisy Mae

A lot of economic activity in the last couple of decades has been driven by this kind of “churn”. Throwing out perfectly good appliances, electronics, TVs, clothes, furniture, cars, even houses, to replace with the new shiny and trendy. People doing this are probably the same ones crying about recycling paper and going into hysterics over global warming.

#163 Nostradamus Le Mad Vlad on 03.15.11 at 9:05 pm


Lotsa links plus chart at end comparing Dow and Nikkei.

Not a great day for stocks in Asia, and Hawaii — First state with US$4 gal. gas.

13:59 clip Radiation detected in Russia, and Fourth plant has exploded, killing two at least, and Chernobyl Part Two.

Just as those nuke plants are melting, so are we. Everything follows on.

Chaos — goes somewhat with what I mentioned earlier. US Fifth Fleet and “Sen. Al Franken claimed Monday that big corporations are “hoping to destroy” the Internet and issued a call to arms to several hundred tech-savvy South by Southwest attendees to preserve net neutrality.”

Rule 48 Invoked Crash? “Rule 48 halts the requirement for market makers to send pre-opening indications, or bid and ask prices created in auctions used to determine a stock’s opening price. The regulation is used only when the “potential for extremely high market-wide volatility would likely impair floor-wide operations at the exchange,” NYSE Euronext said.”

Communist Manifesto Sweeping and cleaning streets builds good habits. It is certainly better than sitting on one’s ass collecting pogey, and Jobs Which Pay.

WI Unions “With the Japan reactor scare being the straw that broke the already-weak Wall Street back, who will notice?” wrh.com.

Homeless in Hawaii When one doesn’t live in a permanent abode, how can that person be evicted from something that doesn’t exist?

3:41 clip New energy sources from somewhere. Thinking caps on.

#164 HouseBuster on 03.15.11 at 9:07 pm

161 Utopia – “the US dollar is widely anticipated to rally which will scuttle ”

—————————————————–
If it is widely anticipated then it is not going to happen. BTW, the USDX was not up much today at all.

#165 Boombust on 03.15.11 at 9:26 pm

“…here’s a fact for you –tri-cities–of all price changes from my e-mails today–27% of these properties are selling for less than the seller paid –you figure it out. -PoCo

Hi Poco.

I live in the Tri-Cities area, too. I agree. Prices are definitely softening. The smart ones are starting to UNDERprice the competition.

It’ll be getting really ugly. For them.

#166 Macrath on 03.15.11 at 9:51 pm

Nikkei 9,157.50 +552.35 +6.42%

Nikkei Surges As BOJ Injects Another ¥3.5 Trillion: Just Add It To The Existing ¥23 Trillion Plunge Protection Tab.

This is direct evidence of rigged market madness. Every day this week they have been pumping the DOW with Bernanke bucks. Its so obvious its ridiculous. I`m taking my marbles and going home !

How does this end complete collapse or hyperinflation ?

#167 dd on 03.15.11 at 9:56 pm

.#161 Utopia on 03.15.11 at 8:53 pm

…Precious metals are still commodities…

Wrong. Look at the long term US$ and compare to gold chart. Direct opposites. Gold has increased 15% a year. The dollar has depreciated every year since 2000.

…On the contrary, deflation fears are rising again…
1/2 correct. Deflation in assets. However money printing is inflation (by definition). So deflation and inflation can and will happen at the same time.

…Further, the US dollar is widely anticipated to rally…

Maybe but not over long-term. With excess money printing investors and bond holders are getting more nervous. Actually if the $ is so great why is the main holder of current bonds the Federal Reserve?

#168 An Cat Dubh on 03.15.11 at 10:21 pm

The only “good” that may come out of the tragedy, that people will smarten up with their spending and realise what really is important. Another good thing about the coming crash, is hopefully smaller more attractive homes

PS:Charlettown must have a bunch of morons. Greenhouse gas. CO2 is NOT a greenhouse gas, it is one of the basic elements of life. The sun is the major changer of weather here. I do not belong to the Global Warming Cult.

#169 The American on 03.15.11 at 10:34 pm

At #168: dd, actually Utopia is correct. The long-term (even near-term) projection of the value for the $USD is anticipated to increasing sharply and rapidly. I’d post the links to show it, but I’m too lazy. If you really must see it, let me know.

#170 Kits on 03.15.11 at 10:35 pm

68 the truth

When I use the term “stupid” to describe you, it is a gross understatement.

Read the article referenced in #28 (thanks 45north). Eductate yourself before you post.

http://www.businessinsider.com/japan-reactors-pose-no-risk-2011-3#ixzz1GdZ5gO5O

#171 Thetruth on 03.16.11 at 2:40 am

#171Kits

You can be precisely described by the term “dumb***”

If there was no risk of a meltdown 24 hours ago, would the Tokyo stock market been down 14% intraday??

#172 dd on 03.16.11 at 8:38 am

#170 The American

…Actually Utopia is correct. The long-term (even near-term) projection of the value for the $USD is anticipated to increasing sharply and rapidly…

Look at the long term chart of the USD. Down. 8 head and shoulders patterns all the way down. Believe what you want. However when the supply of dollars are expected to keep increase at a rate of $1 Trillion a year mathematically it has to go down. These are facts.

#173 Vancouver_Bear on 03.16.11 at 1:54 pm

#153 morry on 03.15.11 at 7:50 pm

I will pay for my airfare myself cause I can afford it; unlike you who can only afford greyhound bus with weirdo ppl….who may also decide to decapitate you.

http://www.cbc.ca/news/canada/story/2008/07/31/greyhound-transcanada.html