What does $730,000 buy? In Toronto, not even the average-priced detached house. In Vancouver, a tear-down in a second-rate neighbourhood. In San Francisco, a modest home that used to be $900,000. In all three cities a fat government subsidy keeps prices aloft. But in one, the jig is up.

In both Canada and the US, the government stands behind mortgage insurance. It means banks have most of their lending risk wiped away, which means they hand out fat loans like condoms at the Gay Pride parade (I like the ones with flames). In turn, that means fat prices.

In fact in this country, you can buy a $730,000 house with just 5% down – about the price of a Silverado with balls. The government will insure the $700,000 mortgage, which means BMO or TD will give you a home loan at the same rate as the guy who just bought a $450,000 semi with a $300,000 downpayment. As you can see, the existence of CMHC insurance turns up into down, redefines risk and helps screw affordability.

Apparently the Yanks get this. Washington is about to lop off insurance for high-end houses (which would include all those in Vancouver), ending insurance at the $480,000 mark in pricey places like northern California. The likely result: a price plunge, realtors figure. And with it, far higher interest rates on mortgages above the federal limit.

Hmmm. Could that happen here? It’s being considered, I hear. After all, why are property virgins buying a townhouse in Dartmouth for $125,000 paying the same insurance rate as idiots shelling out $600,000 for a condo in Yaletown? And why are their mortgage rates identical, when any real estate correction would wipe out the Vancouverites first?

It means the feds are subsidizing risk, of course. And there’s nothing conservative about that. If you get my drift.

But here’s Tracy. We’ll let her give you another reason some markets are doomed:


I was telling someone today that my father sold his condo in North Vancouver. They asked me why he would sell, and I explained that the market had been up for a long time and that most likely it would go down in the future. The individual (from Vancouver) looked at me like I was a nut bar, absolutely if insane and told me that the market would never go down here. I stated that Ireland, California, all of these places of had seen a huge market drop.

It is so funny to see people’s reactions when you say the market may go down, it is like you have deeply offended them to their core, and they talk as if they are the expert economist, even though they bought their property at the top of market.

If this vaguely reminds you of Nortel or Bre-X, that’s good. Major markets in Canada are now running on fumes, in the absence of improving economic fundamentals. I mean, does anyone really expect household incomes to start rising in 2011, or for interest rates to take a big drop? What possible reason is there to believe families will rush into more debt to support ever-rising house values?

Except in Calgary. It’s different there. It’s so different, in fact, that the major daily newspaper can run a story under the headline, “Sellers’ market possible by end of year.” No matter that sales have plunged 10% so far this year and the spring market didn’t exist. The Herald quotes verbose LePage spokesguy Ted Zaharko as saying sellers will be back in control of things by Christmas amid rising prices.

Here’s why: “Alberta is a hell of a place to live – mortgage rates are still low and now we have a majority federal government. Things are looking up.”

See what I mean? The last refuge of the desperate is bravado and jingoism. When realtors tell you to buy now because we have the same government and interest rates as two months ago, you can smell the fear. There is no logic. Just emotion.

High real estate values are in nobody’s best interests. They suck off billions in consumer cash flow which migrates to the bank towers in interest payments. This money is certainly not lost to the economy, but it’s hardly creating jobs at the malls, car dealerships, mills or mines. Historically expensive houses have built a mountain of mortgage debt, destined to be reset at higher rates. It’s drained cash from investments and retirement savings plans. And when seven in ten families own houses, and yet four in ten have no savings, we’re headed for the ditch.

Only the naive among us believe this can last. The naive and the indentured. God help them.


#1 S.B. on 05.16.11 at 9:25 pm

First! :) :)

#2 Tim on 05.16.11 at 9:33 pm

I doubt that will happen here, they are doing their best to keep this bubble alive, keeping rates low, the media is totally biased toward real estate, etc.

#3 2deep on 05.16.11 at 9:34 pm

Timely points on the CMHC.

We are looking to get out of our home that we purchased in the fall of 2007 and basically by the time we subtract our closing costs and what we paid into CMHC we are underwater. Even though our home value has stayed completely flat we will lose the down payment we put into it not to mention all the payments we’ve been making over the last three years (all interest).

I don’t know of many other things that you pay all of your insurance fees up front (40 years worth in our case) and if you back out early you don’t see a refund. I guess that’s because most insurance is paid monthly/annually etc. Too bad we can’t just “bank it” until we decide we may want to purchase in a year or two when things have settled down and our finances are better off.

#4 CONservatives hate free markets. WHY? on 05.16.11 at 9:36 pm

The fascist Conservative hate the free markets . Will the fascist Conservative stop their fascist ways and become Conservative as get rid of CHMC? I think we know where the current Fascist Conservative stand on free markets and democracy. Bail outs to corproations and banks = fascist Conservatives.

P.s I called the Communist Conservatives ….Communist but now I think they are more fascist . Tell me what you think the Conservative have become? Fascists or communists?

#5 Mr. Lee on 05.16.11 at 9:37 pm

House Servitutde.

That is what we have, and as things get tighter. The same “Greater Fools” that bought in at an inflated market will spend less and less in the greater economy. Just guess what is going to happen then.

Mr. Turner quotes the esteemed Real Estate Board peddler that our Daily is more that happy to cover in some attempt to shore up sales in a lousy sellers spring market.

Home prices in Canada will again be 3.5 to 1, but first the pain will come.

#6 Canada's housing Market = Nortel on 05.16.11 at 9:39 pm

You know housing is in a bubble when the 7-11 clerk is giving housing tips on what and where to buy. The days are here again only this time it’s in the housing market. Look out below.

#7 Don't know what I'm doing... on 05.16.11 at 9:41 pm

#221 Blobby on 05.15.11 at 11:22 pm:

“WHY ON EARTH would you (or anyone) put 100 big ones into a 3.7% taxed return!?!?!?!

If you had 100k to invest, one would hope it’s because you knew what you were doing with your money.. and buying something which is below inflation after tax would show you dont….”

You’re right. At 40 with my debt of zero, my $600K+ house paid, and my $800K+ of cash in the bank earning about 2.5% on average, I have no idea what I am doing.

But boy do I ever sleep well at night. It’s all relative.

What a waste of eight hundred large. — Garth

#8 Jsan on 05.16.11 at 9:44 pm

This will probably be posted a few times if it hasn’t already but the Real Estate damage control team seems to be trying everything they can in a sliding Australian housing market. They have suffered from the same delusions that we in Canada have suffered.

Pretty soon even the Greater Fools in this country will finally understand that it is “never different here or this time”. That a bubble is a bubble no matter where it happens. Every single bubble inevitably comes crashing back to earth and when bubbles pop, it is usually not obvious until it is painfully obvious and than it’s too late for those last in holding the bag.

“Australia Real Estate Bulls Trot Out Every Cliché Known To Man”

#9 Dazed and Confused on 05.16.11 at 9:44 pm


Know any amazing financial advisors in god forsaken Cowtown?

Been sitting on what I thought would be a down payment for two years and now looking to make that money work for me rather than invest in what should be the worst housing correction of our lifetime.


#10 Weeping in Windsor on 05.16.11 at 9:46 pm

And in the Windsor area this is what you get for $729000

#11 shanks on 05.16.11 at 9:48 pm

Ah debt free life… it doesnt matter if you own or rent, nothing beats being free and clear of debt.

#12 JesseJames on 05.16.11 at 9:49 pm

don’t you folks ever run out of things to talk about?

#13 Chaos on 05.16.11 at 9:49 pm


I almost said it. You know, that word that we all hate.

So I’ll just say…whatever.

#14 ballingsford on 05.16.11 at 9:50 pm

It also sucks that the head of the IMF is now in jail. We are less than sheeple, we are a brainwashed sheeple who believe whatever the almightys tell us. What other lies have we been fed?

First by the way!

#15 Bill Grable on 05.16.11 at 9:51 pm

For the first time in my life, I had a friend tell me to my face that I was a “doom and gloomster” when I ventured that he might be a bit leveraged with three rental homes and a principal residence. In Vancouver.

It was like I had just dropped the F bomb at a Convent.

The air was sucked out of the room.

“You are crazy – totally no clue man, the only way to make money is with RE”. You are stupid to throw away money on rent.”

Well so much for a convivial day at the office tomorrow.

#16 Mr Buyer on 05.16.11 at 9:52 pm

I was shopping around for a house last week in Ottawa and could not find anything under 250k (and that was a dump). I found a little place in Gatineau for 187k (210 asking price) but subsequent inspection indicated 15 to 25k in replacements and repairs, not bad but I can wait so I passed as I prefer to live in Ottawa if I can. I mentioned to the Realtor that I was paying cash but she said it did not matter to her. My home town outside of Ottawa is a ghost of its former self yet the house prices are through the roof there as well. The markets are certainly driven by supply and demand but the supply of money is what is behind this housing crisis. How can I cash in hand ever compete with the bank. CMHC or not, it is in the bank’s interest to drive house prices up (no pun intended). Can I hope for are return to hose prices related to annual salaries in some reasonable way in the foreseeable future in Ottawa? Where are all these 100k a year jobs necessary to support these prices?

#17 realpaul on 05.16.11 at 9:55 pm

You’re right that the fat that is being sucked out of the economy due to record high prices is benefiting the banks. But then…why shouldn’t the banks benefit? It’s the government pandering that has allowed the ZIRP and the CMHC to persist. But……it’s like the Bloc screaming about Vegas Brosseau running in a constituency she’d never visited. In Quebec , it was obvious…the election had been timed to run during the hockey playoffs and no one cared enough to bother to listen. In the ROC the ZIRP and a risk free pandering of free mortgage money was all the Conservatives needed to create a lot of house horny teenagers ( Anyone under 40 is a tennager to me) and the effect was the same…no one paid the least attention.

So….people are stupid…they get what they deserve from sleazy politicains whose only goal is manipulate circumstances for their own gain. How do you win at this game? Buy bank stocks…..TD and NA are in nosebleed territory and raising dividends…both should split and the music will start all over again. Don’t fight it………go with the winning side…it’s easier.

Where we can’t win as citizens of this once great land is the taxes we will have to pay for all the pandering. Yes…the Conservatives have doubled the national debt in 6 short years. But the debt was already sky-freaking-high before the Cons came to office. They were forced to pander to every special interest group in the country in order to stay friends long enough to gain a majority. The fact that the Liberals lost to the NHL was a freebie.

This is a no win game for Canadians who are now the most indebted taxpayers in the G8…and it’s getting worse. As an investor you can hedge against rising costs by buying energy stocks….gold stocks…general commodities that have revenue outside Canada. But other than leave the country…we may as well just buy a case of lube and bend over.

Obvious the charade of ZIRP and ever increasing ‘house values’ can’t go on forever. $400,000 mortgages are unaffordable to anyone who forms the majority of the wage earning class of this country. And….there are only so many immigrants to hide the fact that Canadians are getting poorer vis a vis ‘affordability’ The inflection point will resemble a large volcano….there will lots and lots of flying crap. Pucker up…..the end is nigh.

#18 Peter Pan on 05.16.11 at 9:56 pm

Reason why Vancouverites get so defensive about the *possibility* of real estate prices going down is not because they WANT the value of their house to go up… they NEED it to go up. HELOCs subsidize a lifestyle they can’t afford. Capital Direct is the Money Mart for Vancouverites with home equity.

#19 Frustrated in Vancouver on 05.16.11 at 9:57 pm

I swear I feel I’m literally living inside a bad episode of “The Twilightzone”:

#20 Mister Obvious on 05.16.11 at 10:00 pm

Regarding post #1:

I wish they’d just go back to “First!!”

#21 nonplused on 05.16.11 at 10:00 pm

Nice clean post today Garth.

Calgary just might have a seller’s market by Christmas. Or make that a seller market, as the way listings are dropping there might only be one. But there still won’t be any viewings.

I don’t know if I buy your hint that CMHC may stop insuring jumbo mortgages. I think continuing to inflate the housing bubble might be part of the plan. Otherwise why did they let it run so long? Surely Carney has plenty of bright young analysts writing reports on how the housing bubbles in the US, England, Spain, and Australia worked out? Surely they have better statistics than anyone on how rising rates will affect family disposable income at this point? They must know that we are now trapped at the zero bound, unable to lower rates but also unable to raise them significantly.

#22 Vancouver on 05.16.11 at 10:03 pm

but it truly is different in Vancouver!

#23 Mister Obvious on 05.16.11 at 10:03 pm

The original first post slipped to 4th in the blink of an eye. That rendered my post above confusing and pointless. But maybe it was anyway. I give up.

#24 Mr Buyer on 05.16.11 at 10:08 pm

CMHC has been around a long long time why has this huge price jump occurred relatively recently? You know I am a boomer (but just as I was born in the last year of the boom) and I must say our intense focus upon ourselves is turning out to have not served us very well. The Vietnam war was the high water mark but our extreme self indulgence has not been a fitting example for generations that follow. Now as the ultimate betrayal, we are passing the consequences of our social inaction (as opposed to special interest action) lack of duty and lack of a work ethic on to the next generation. In truth we the boomers would have left the previous generation high and dry (which we did). I say the generations that follow owe us no loyalty whatsoever.

#25 mid-Ontario on 05.16.11 at 10:08 pm

The RE results for this area for April are just in today.
Average price down 5% y/y.
Sales down less but “much improved over the drop of 19% in March”.
Let’s blame the cool wet Spring.

For two years, I told my hairdresser of 25 years not to even think of buying based on Garth’s words of wisdom but she did and now it seems that she bought at the peak of the market. All the cliche’s of ownership will be touted as the sinkhole chews up all her equity for who knows how long. I tried but failed.

Any thinking person would look at a 5% drop and say “I wonder if the drop will continue”. A few won’t so the market will be “mixed” in the heads of the RE people but we all know that the melt has begun and it will get worse as the year progresses and the general intelligence of the would be buying public improves.

#26 vreaa on 05.16.11 at 10:14 pm

Vancouver Westside vs Maui –
Momentum Players Choose Half The Property At Twice The Price

#27 American Werewolf on 05.16.11 at 10:17 pm

“You know housing is in a bubble when the 7-11 clerk is giving housing tips on what and where to buy”

That clerk may be as qualified to bullshit on it as anyone else. I recall checking out at the local Rays Food Place in the summer of 2007. The checker was a real estate agent we interviewed who picked up a side-job to make ends meet. From behind the counter, he remarked that we wouldn’t see any action until we lowered our price below $300K. My wife and I laughed a bit, thinking that an agent who is working at a grocery store just may not be in the know.

3 years later our house sold near $200K.

#28 Mr. Reality on 05.16.11 at 10:21 pm

Garth you nailed it man. Redistribution of wealth is the single most dangerous aspect of an economy. Take money away from the consumers and put it in the hands of the banks = economic death.

The problem is this is going to be very slow and painful

Mr. R.

#29 Utopia on 05.16.11 at 10:33 pm

#328 Min in Mission on 05.16.11

Glad to hear you enjoyed my little story about Garth’s contest. I was starting to wonder if anyone else (besides me) got a good laugh out of it.

#316 Live Under Your Means on 05.16.11

“They didn’t have Green in my day”

Thanks, I really enjoyed that piece you sent in. It made perfect sense to me. I could tell it was written by a younger person though because as I recall my Mother and her Mother were even more frugal and conservative in their days.

Home canning, darning socks with the aid of old lightbulbs inside the sock, producing at least half your own food in the back yard, making your own booze and even home growing the tobacco for Gramps pipe.

We shared in the cost of a fall-pig for slaughter with the neighbors and Mom did all the cutting and canning of a side of beef. Nobody thought it was frugality though. It was just normal.

Oddly enough, the dollars they earned then had much more buying power than today. They had less of them of course but they went much further and small change still had a lot of value.

Yes, things have changed. We were much greener then than now and much more self reliant too. I think it will pay dividends in the long run to know how to live better with less over the coming years.

Some very hard times are coming back and almost nobody is prepared anymore. Most of the knowledge has been lost and younger people have only faint memories of the essential skills of daily survival.

I don’t know how most of them will make it to be honest.

#30 Ralph Cramdown on 05.16.11 at 10:40 pm

CMHC premiums are, in some cases, portable. Google cmhc+fees+portable. Of course, you don’t get them back if you take your money off the table.

CMHC has been around a long long time why has this huge price jump occurred relatively recently?

From their FAQ: “I heard that there is an upper limit to the price of a house I can buy with a small down payment?

Not any more. As of September 2003, CMHC removed its price ceiling limitations. For the purposes of qualifying for CMHC Mortgage Loan Insurance, CMHC does not have a limit on the purchase price of a property.”

I agree that CMHC is a BIG part of the problem, but I doubt anyone’s going to try to do anything about it. There’s a difference between cooling the ardour of those not yet in the market and affecting the prospects of those whose home values of those most likely to vote (homeowners) and most likely to vote Conservative (owners of expensive homes). No, I think there will be a lot of whistling past the graveyard in the hopes things don’t go South until the next watch, or the next majority government.

#31 disciple on 05.16.11 at 10:40 pm

M. Buyer…you’ve hit the nail on the head…It is still not too late for the boomers to undo their carnage. They must first begin to understand how they have been hoodwinked by the credit cartel, and simply banish them from their lands. It’s simpler than you think. It would require evaporation of false profits, but you would leave a better country for your children and grand-children. Like a Darth Vader recapitulation moment. A GARTH Vader moment!

#32 Industrial Guy on 05.16.11 at 10:50 pm

The recession is over. You read it here first. Housing prices will skyrocket in this little corner of SW Ontario. 500 minimum wage jobs are coming to Brantford, Ontario! Just imagine the monster house you can buy with the Princely income of $21,840.00 per year! Oh joy!! Happy days are here again.

#33 Hovering on 05.16.11 at 10:54 pm

@ 15 bill

I feel your pain dude

I have become the office RE pariah and have given up trying to discuss RE with any of my friends. “I tried”. I tell myself. I even sent them a link to the greaterfool they all bought anyway or refuse to sell at peak

ah well

#34 Cato on 05.16.11 at 10:56 pm

No escaping the end result of moral hazard. The CMHC, like Fannie and Freddie started with best of intentions but those intentions mask alot of past ugliness, including systemic racism.

The CMHC will be tested, and it won’t be with kid gloves of the auditor general but by the rough hands of the market. In the last 4 years CMHC bureaucrats were given free reign to expand portfolio as they saw fit. Combine that with the 2008 gov’t gift to banks that saw CMHC transfer garbage off bank balance sheets onto backs of taxpayer there is no way taxpayer escapes this unscathed.

The CMHC portfolio grew exponentially after 2006. It took on more and more risk as bubble expanded – bulk of the portfolio are mortgages written during height of housing bubble. Cause and effect – we never would have had housing bubble if the CMHC wasn’t there to feed it. Easy for the CMHC to make market predictions when it was the one fuelling housing demand.

If backlash against CMHC misdeeds are severe enough it’ll be the next generation who pays the price. Even if affordability returns to sane level taxpayer disgust might be such that generation who had nothing to do with the collapse gets screwed out of opportunity for home ownership.

#35 T.O. Bubble Boy on 05.16.11 at 10:59 pm

CMHC = Government intervention gone amok.

Cap the mortgage insurance at $480k (like in the U.S.), and this will be the most expensive property in Toronto that someone could buy with CMHC insurance:

(seems about right?)

#36 BPOE on 05.16.11 at 11:04 pm

Catch the Bloomberg article the other day? America ready to default as it’s reached it’s borrowing capacity. Folks this is great news for Gold and Golden Vancouver. I was driving around the uber elite suburb of Rich man today. Check out the vehicles in this town folks THE BEST. Go down South and drive around Seattle and check out the beaters. Those guys with the exception of drug pusher Gates can’t compete period with our wealth and success. Folks summer is almost upon us and the news release from the Conservative government is imminent. Interest rates are going DOWN! VancouverGoinUp.

The US is not ready to default. You are an idiot. — Garth

#37 Wendy on 05.16.11 at 11:05 pm

Well we’re free as of today! Our house on the east coast sold and we’re on our way to being debt free and instead of sending money down a whole we’re going to start putting away for the future! Seller’s market my ass, it took 3 months to sell our house and it still didn’t sell for asking and it was under the 200 mark!

#38 THE TITANIC on 05.16.11 at 11:05 pm

Garth been reading your blog for sometime now and I appreciate the fact that you have the balls to tell the truth. I wish more informed Canadians would become a little less PC and give it to all the optimists that believe a property in Vancouver will be worth a billion dollars in the future.
For all the renters and people wishing to avoid debt slavery you are not alone…hang in there. This site is like AA for renters and those in touch with reality…and everytime I go back to it, it calms the storm in my brainwashed mind.
For anyone that doesn’t believe this market is sick… well you must be drinking kool-aid on roids. We are in a game of musical chairs where money laundering and Chinese real estate Ponzi schemes rule the market. Everytime a dumb Canadian runs to the bank for more so called cheap money you support the present system.
Think about it. Sure the payments are squat on an $800,000 dollar loan for a DINK couple or Double income family…but thats all your doing. You dummies are borrowing paper money based on a fractional reserve banking system. (look it up you’ll be pissed at what suckers we all are) Think about having a 30 year mortgage beginning at the age of 35…make the standard payment you should have half the mortgage paid down by the time you are 65. Yee Haa freedom 100 plan. The thought is ugly.
In reality, we all would love to own our own homes…it gives a false sense of security. You don’t own it unless its paid for. The bank owns you. bottom line. Those bankers are getting so rich off of peoples desire to keep up to the Jones’ its frightening. I know a lot of Rich Bankers, they drive nice BMW’s and guess what? They rent apartments in places like the Fairmont in Vancouver for 3-5 grand a month. Its cheaper. All the big money guys I know in this city have bailed on their property holdings and blatantly state, “You are an idiot to drop that kind of cash on property right now.” Quote from a very wealty financier friend…when interest rates in Canada go up…Vancouver is going to look like Night of the Living Dead. Another friend works in the forclosure business…he states this is this busiest they have ever been, we are in for a disaster…he also knows someone near the presidents seat at CMHC…that has no answers to his concerns. I think the president of CMHC may at one time been employed by a lender in the past. Just sayin. Do your own due dillegence.
Reality for all the Boomers…back in the 70’s an Iron Worker I know bought their first home in the lower mainland for 20G…I asked how much a year he earned back then…answer 22G. Iron workers do not make 800G a year now…a good year would be around a 100G.
See the problem…enough said.
As For me owned places in kits and southlands…I bailed a year ago. Won the lottery in my mind…any good immigration lawyers that know how to get me the hell out of I’m open to advice. Somewhere warm and cheap where I can surf everyday.
Garth keep up the good work and keep helping us stay grounded

PS China for the most part is poor…PC Canada lets the pimps, and exploiters in for around 800,000-1.6 mill.

#39 Rich in Calgary on 05.16.11 at 11:07 pm

Well, actually it’s true.

In Calgary we have very low mortgage rates and we also have a majority government now.

Too bad the rest of Canada isn’t as fortunate as Alberta.

(Sarcasm off.)

#40 Nostradamus Le Mad Vlad on 05.16.11 at 11:21 pm

“Fossils . . . fat loans like condoms at the Gay Pride parade (I like the ones with flames) . . . of a Silverado with balls.” — Are the loan balls fitted onto a flamed condom? “. . . redefines risk and helps screw affordability.” — Apparently not!

“It means the feds are subsidizing risk, of course.” — And the feds. are subsidized by us, Joe and Jane Taxpayer. As usual, we get the short end of the stick.
#7 Don’t know what I’m doing… — “What a waste of eight hundred large. — Garth”

Hey, gimme! I can do a better job of investing (sorry, wasting) it! That amount should rake in about $60K yr., 80% or more of which is tax free!

#11 shanks — “Ah debt free life…” — Ditto! The banxters hate us, ‘tho. Doesn’t it make one warm and fuzzy all over?!
While we were focusing our attention on other stuff, this arrived, quietly to further mess the economy up which would lead to this — China Headline states the obvious — kickstart for WW3. The west is deadmeat, or thereabouts.

3″16 clip The IMF and World Bank used debt to take over third world countries. How much are America and Canada in debt by? Chart Shows who funds the IMF.

Strausse-Kahn “Strauss-Kahn is the mastermind of the IMF plan to impose a global Federal Reserve system on the nations of the world (and wage war on those that, like Libya, refuse). In that context, the absence of morality required to orally rape and sodomize a hotel maid (not necessarily in that order) seems like a foregone conclusion!” #334 BrianT on 05.16.11 at 9:51 pm — Further to what I posted earlier, but I agree — there are many variables.

Obamanomics Hits the nail on the head. China cuts US holdings for fifth month. Hmmm. Wonder why? Treasury Dept. “The last thing a cancer eats is itself.”

Fukushima pix. Good job one mayor had the right idea, ‘tho he was laughed at at the time.

Honeybee die-off Possible explanation, plus Vaccines do more harm than good.

#41 blase on 05.16.11 at 11:35 pm

Calgary has two daily newspapers, the Herald and the Sun. They are both an embarassment.

#42 Siddelly on 05.16.11 at 11:41 pm

#9 Dazed and Confused

Some free advice-read the disclaimer

TELUS DD 5.05% 04DEC2019

#43 not 1st on 05.16.11 at 11:54 pm

Garth, when are you going to post some insight into the saskatoon and regina markets? Seems like you just keep skipping from VC to TO and back again.

#44 JCH on 05.16.11 at 11:58 pm

Garth, can you please comment on why you think the original CMHC price cap was removed? (in 2003 I think) Thanks, & love your blog!

#45 dave in calgary on 05.17.11 at 12:01 am

What I find crazy is there are still people who think the Herald is actually a newspaper. Around 2006 it started to become a real estate classified, and has never looked back. Verbal diarrhea, day in, day out.

#46 McLovin on 05.17.11 at 12:11 am

The Gov’t will never tinker with CMHC. They have a vested interest in seeing a strong housing market and would not do anything to jeopardize it.

#47 Burnt Norton on 05.17.11 at 12:12 am

#19 Frustrated in Vancouver on 05.16.11 at 9:57 pm


Why be frustrated, man? Just rent a place. Think of it this way:

If you’re an average but broke poker player, you don’t play the $5,000 buy-in tables on house credit unless you’re high or stupid or both.

If you’re a really good but broke poker player, you don’t play the $100,000 buy-in tables on house credit unless you’re a high and stupid Canadian who thinks that it’s ok to declare bankruptcy and walk away, blaming everyone else for your predicament. Only problem is that Vinny and Lenny will be waiting for you at a street corner on the way home. Oh well, at least your Canadian hospital bill will be covered.

Just because your banker doesn’t carry a Louisville Slugger, doesn’t mean he can’t f*** you up.

#48 Junius on 05.17.11 at 12:23 am

#4 CONservatives hate free markets,

The Cons are closer to fascists than socialists. The Republicans the US are just about there now and the Cons are following closely behind.

The control of the state by corporations is the core definition of fascism if you believe Mussolini who should know. The US state is increasingly controlled by the money pumped into Washington by the major corporations. Look at the Financial lobby, Big Pharma, Big media, Big Oil and Bib Media. All the same.

The Cons are following the same script.

And yes, Big corporations hate free markets because they don’t like to compete. They became big so they didn’t have to compete.

#49 somecatchphrase on 05.17.11 at 12:32 am

Today’s post gets at the true heart of the matter.

When people are forced to spend 30%+ of their income on one of the basic necessities of life, it starves the broader economy of capital that could be put to a better use.

In Canada, with our miniscule population, huge landmass, and abundant supply of trees with which to produce lumber, we should enjoy some of the cheapest real estate prices in the world.

This would leave us all with more money to invest and/or spend at the mall, eat out, take a vacation, or buy a new car.

Worth reiterating –

“High real estate values are in nobody’s best interests. They suck off billions in consumer cash flow which migrates to the bank towers in interest payments. This money is certainly not lost to the economy, but it’s hardly creating jobs at the malls, car dealerships, mills or mines.”

#50 Junius on 05.17.11 at 12:32 am

#24 Mr. Buyer,

The CMHC has been around since just after WWII but the “new and improved” CMHC is a creature of H and F our illustrious leaders.

They changed the CMHC rules and lowered the insurable down payments from 20% down to 0% for a period before raising it to 5%. They also changed the amortization period from 25 years to 40 before pulling it back.

These changes in 2006 and afterwards are the primary cause of the Canadian housing bubble. They jet fuelled our economy and they are the reason we did not have a crash like the US because were still taking effect through 2009 and beyond whereas the US boom started in 2001.

They are also the reason we will now have a crash which will eventually cause significant losses to Canadian tax payers who will have to pay mortgages that should never have been given by banks who are insured.

Money flowed into the bank’s ivory towers and created a nation of debt slaves. See post #4 on Fascism.

#51 Bill Grable on 05.17.11 at 12:49 am

Suggest Maui is to be avoided at all costs. The disaster was depressing when we there – and the fuel costs, soon to be arriving Japanese garbage and well, it’s so bad, Dog the Bounty Hunter is moving to North Dakota. * That’s a lame referral to one of the few flush States of the Union.

#52 Tim on 05.17.11 at 1:16 am

Senator Tommy Banks Warns agains Harper:

Still worth reading to know what we’re in store for…

#53 Boycott on 05.17.11 at 1:20 am

We need to spread the message and boycott home buying.!/pages/Canada-home-buyers-boycott-now/203937936304340

#54 You have my VOTE! on 05.17.11 at 3:08 am

“Washington is about to lop off insurance for high-end houses (which would include all those in Vancouver), ending insurance at the $480,000 mark in pricey places like northern California. The likely result: a price plunge, realtors figure. And with it, far higher interest rates on mortgages above the federal limit.

Hmmm. Could that happen here? It’s being considered, I hear. After all, why are property virgins buying a townhouse in Dartmouth for $125,000 paying the same insurance rate as idiots shelling out $600,000 for a condo in Yaletown?”

I would gladly sign a petition, vote a guy/gal in office or support such a smart move.

Good to see the Americans are learning from experience, getting wiser and preparing themselves for a future. Canadians on the other hand… well, we’re different right?

#55 Andy In Vancouver on 05.17.11 at 4:55 am

Informal RE survey…
In my condo building in New Westminster (Greater Vancouver), there are 5 of 26 units listed this week. Usually, it’s around 1 unit.

So … maybe more listings this spring.

#56 Markey on 05.17.11 at 6:13 am

Garth, thanks to you and your many readers who provide links to interesting news, I have information to validate my gut feeling that we are in a real estate bubble and potentially serious trouble.

A young lady at work (30+ Chinese) told me she was thinking about buying a condo because her money would grow more in real estate than other investments. I told her I believed that she would be having a Nortel moment if she bought now and I told her why.

Well, last week she did buy and so did her parents and her boyfriend — from floor plans to a new development by the CNE that sold out in hours without ever having been made available to the public. She had only a few minutes to decide on the unit that she plans to flip once it is built, or to have a tenant carry the rent.

According to her, foreign investors are buying Canadian real estate because, in this tumultuous world, it is a safe investment. She didn’t want to miss the opportunity.

Now, I understand that a 30-year-old has never seen a real estate plunge, but her parents have. Do people really have such short memories?

#57 Gord In Vancouver on 05.17.11 at 6:48 am

Thanks for the educational post and using examples that make it easier for all to understand.

#58 Gord In Vancouver on 05.17.11 at 6:53 am

#22 Vancouver

“….as China tries to damp property speculation at home.”

….more proof that Vancouver’s housing market has deteriorated into a casino.

“….as a result of Canada’s liberal immigration policy…”

….which was introduced by a majority Liberal govt. Sooner or later the Conservatives will have to appease their right of center base.

“Vancouver was more expensive than San Francisco, London and New York…”

Self explanatory

#59 Love this Blog on 05.17.11 at 7:06 am

# 4

Hi Tim!!! Still chewing on those sour grapes, I see!!

#60 maxx on 05.17.11 at 7:13 am

#16 Mr. Buyer-

It actually used to mean something, before debt turned into no-risk equity for the banks, when someone had a pile of real cash in their back pockets. Realtors don’t care a whit what you have, they care about what you can borrow. Sellers benefit, realtors benefit, banks benefit big-time, insurance companies benefit and local governments get to tax you at the next price-set level….and they’ve produced nothing. You, the buyer, do not benefit.
This Ponzi scheme is the best ever devised to make fiscally responsible people, who have amassed cash, feel poor.
So if you decide to take that risky plunge, make 100% certain that you’ll love the place for a very long time and that you’ll live there long enough not to lose money on it…..and don’t lose your job, let it move, get separated, divorced, become ill, etc.
This areas’ realtors have altogether become spoiled rotten by easy government money. The tide is now beginning to turn and your money IS worth something. I know so many people with lines of credit which they use for essentials….some, in their thirties, hope to have it paid off by the time they are in their fifties.
Real estate pricing power is on the decline.

#61 Marvin II on 05.17.11 at 7:31 am

“Only the naive among us believe this can last. The naive and the indentured.” ~GT

Yes. If not, there is indeed something fundamentally wrong with the universe.

#62 T.O. Bubble Boy on 05.17.11 at 7:34 am

I decided that my previous example of a “max” house if CMHC was a bit too nice… and I forgot about the 5% down! A max $480k mortgage from CMHC could mean a purchase price of up to $505k or so.

In Toronto, something like this beauty:

Or, in Vancouver (ha ha), this 400 sqft “house”?
(looks like a garage by the Hampton Inn?)

Thank you CMHC for making the home ownership dreams of all Canadians come true!

#63 Northern_dirt on 05.17.11 at 7:41 am

#2 Tim on 05.16.11 at 9:33 pm

I doubt that will happen here, they are doing their best to keep this bubble alive, keeping rates low, the media is totally biased toward real estate, etc.

Eventually fundamentals catch up with sentiment..

#64 shanks on 05.17.11 at 7:42 am

#40 Nostradamus Le Mad Vlad on 05.16.11 at 11:21 pm

#11 shanks — “Ah debt free life…” — Ditto! The banxters hate us, ‘tho. Doesn’t it make one warm and fuzzy all over?!

they dont totally hate us, because i for one need to work to remain debt free, so I still play into their system… bank fees, taxes, etc. This is where the idea of home ownership becames very attractive to a lot of people. People beleive that if they can somehow earn their home free and clear, that is it. Unfortunately, that is not the reality and the days of owning a piece of land and being able to live an independent and self sustaining life are long going (what with property taxes and God knows what else they hit you with).

#65 Sid on 05.17.11 at 7:48 am

how about buying into an etf that shorts commodities. ANy ideas or opinions

#66 MikeT on 05.17.11 at 8:10 am

CMHC was build to help with AFFORDABLE housing.
Why is it insuring jumbo mortgages in the first place?
What the US is doing is right, but too late – they should have done that from the start. And the sooner CMHC puts a cap on the amount per mortgage that it insures – the better for us all.
However, since 70% of Canadians own homes, they form the lion’s share of the income tax base, so when (not “if”) the shit hits the fan and CMHC has to step in to pay the banks in lieu of the bankrupt homeslaves, it will not have enough money to cover it all, so it will have to borrow from the banks to pay the banks the difference.
Thus, CMHC will pay the banks the amounts for insured and bankrupt mortgages, then will borrow from the banks to pay the banks the money it owes but does not have, and then it being part of the government, the taxes will rise to cover the interest and principal repayments to the banks for the borrowed money. So, it’s clear who the winners are and it’s crystal clear that da pipl is screwed twice: living with high mortgages in a dropping RE market AND paying higher taxes. To add insult to injury, jingle mail is not an option in Canada.

#67 Mr Buyer on 05.17.11 at 8:17 am

Here in Japan a piece of land decreases in value if there is a house on it and 40 or 50 year old houses are demolished. Our financial strategy is rudimentary. Work long hours and bank as much money as possible. Interest on savings is way way below 1% and interest on mortgages is very low. When I first met my wife I went on a trip to Osaka with her and we stopped by a bank to withdraw some money. The bank teller asked what the money was for. That was nowhere near as surprising as the interest rates on loans which took me 10 minutes to decipher as it was below 2 percent or something. Having been in country for only 2 years at that time I was quick to suggest to my wife that we should borrow money and buy houses. My wife looked at me as if I had suggested we should stomp on bunnies or something. BORROW money she said in disgust. It was almost a deal breaker for our coming marriage. My wife shot back, why would you want to buy an old house? It was then that I realized there were other ways of life not unlike my grandmother’s. I have been thinking and saying much of what is here in this blog since 2002. 70 hour work weeks for 11 years have opened my eyes. My wife’s grandmother is almost 90 and she goes out into the family gardens every day to gather food for the table and for sale. She profits about 3k a year from working her gardens. There are get rich quick schemes here in Japan but most people understand nothing is for free. The bubble economy burst here fifteen years ago and people even in my small town lost 50% of the value of their speculative real estate investments almost overnight and the land price has remained the same since (about 2k per 3.3 sq meters in my neighborhood, with no old house on it).

#68 D from London, ON on 05.17.11 at 8:17 am


You say that we let the “pimps and exploiters” from China in under the “entrepreneur class” of immigrants? Well, I agree with you. Ditto for the same class of immigrants from other countries. But most tellingly, we particularly reward the pimps and exploiters native to our OWN county – that’s what our current economic system is based on.

Why should we have a double-standard for immigrants? What’s good for our home-grown petit-bourgeois class is good for the same class of immigrants! At least that’s what the PC side of my brain says…

The realistic side of my brain tells me to put down my copy of Das Capital and slowly walk backwards towards the door…

#69 Junius on 05.17.11 at 8:37 am

#46 McLovin,

Perhaps you missed the part that the Cons have now tightened the CMHC rules twice in the past 14 months. You also missed the part that they won their majority gov’t and now don’t given a flying Flaherty about homeowners.

How naive.

#70 kilby on 05.17.11 at 8:45 am

Global Vancouver just reported that house prices in Vancouver have eclipsed both London and New York and it seems that people are excited about it. This would be the precursor of the end it would seem. When people realize this they may finally say WTF……this can’t last.

#71 PEI Red on 05.17.11 at 8:54 am

The truly obscene thing about high ratio mortgage insurance is that it’s amortized over the length or your entire mortgage. Do the math, you pay for that insurance 2-3 times over on a 30 year amort. A suckers bet if I’ve ever seen one.

#72 MikeT on 05.17.11 at 8:55 am

sorry, didn’t structure my post very well – wanted to write about too many things, but not enough time. Ignore it. :|

#73 watching on 05.17.11 at 9:02 am

While waiting for prices to return to a place where it makes sense to buy again I’ve been looking for signs of what’s happening in the market.

Yesterday 3 indicators stood out:

A seemingly successful realtor in my area now posts a HUGE message under her Sold sign indicating SOLD FOR OVER ASKING. This to me is a sign of over confidence – translation: market too hot and about to change.

Next I drove by a very fast selling neighborhood and saw my first “Property Guys” real-estate sign. It has been a long time since I saw one of those in these parts – sign seller is very confident indicating market is hot and could be about to change.

Finally, I received a call from a realtor who has called me in the past asking what my RE needs were. I indicated I was waiting to see what occurred in market and looking for prices to come down before acting. I asked him what his opinion was – he said fewer calls were coming in and fewer multiple offers so he senses a change.

Far from conclusive but I’m satisified with our choice to be renting right now.

#74 disciple on 05.17.11 at 9:13 am

Shanks, baby!
I totally agree with you! That is the heart of the current issue: people believe that when they have a paid off house, that they are then independent, or rich or somehow free from the system. This is what I used to believe, but thanks to people like Garth, I have seen the light. Further research showed me that even if you have paid three four or five or six times the original appraised value of your home over whatever number of years(like a good slave), the deed of the house still sits in the county clerk’s office…you may have legal title but that is all. Totally meaningless and a fraud. Your gov’t (mind-controllers) can come along at any time and confiscate it. That’s the truth, painful, hard to believe, god’s honest truth. You are renting the Queen’s land whether you know it or not.

#75 NotAGreaterFool on 05.17.11 at 9:14 am

The Canadian Real Estate Association blamed new mortgage rules for taking first-time buyers out of the market, as it reported sales slipped 14 per cent in April compared to last year.

#76 AG Sage on 05.17.11 at 9:19 am

>#66 MikeT on 05.17.11 at 8:10 am
CMHC was build to help with AFFORDABLE housing.
Why is it insuring jumbo mortgages in the first place?
What the US is doing is right, but too late – they should have done that from the start.

Aye. Garth, in general, drastically oversimplifies the mortgage markets in the U.S.

The U.S. always had a cap on conforming mortgage amounts. They temporarily lifted it during the crisis. During the crisis all lending was frozen, except that directly funded by government entities (and psuedo government entities). You can imagine that a complete freeze on all lending risked crashing everything, 1930s style. Given that the gov was the only game in town, keeping the cap would create a market distortion of epic proportions. They removed the cap. It was always temporary, and now that banks are lending again, the cap is gone again.

#77 nelsonktown on 05.17.11 at 9:19 am Wow great deals out west huh …yea right

#78 disciple on 05.17.11 at 9:20 am

True capitalism does not require banks. I am not a capitalist, I am a true capitalist. There is world of difference. In one system, there is a third party that can legally counterfeit the currency. In the fraud-less system, there are only buyers and sellers, as it should be. Boomers need to stop electing bank puppets and in so doing, save the world for their children and grand-children. Income tax is extracted ONLY to pay the interest to the bankers. Gasoline taxes pay for roads, property taxes pay for schools, excise/retail/etc…taxes pay for all other social services. Income tax is not necessary and is another fraud. Don’t let stupid people ruin your world, wake up!

#79 BrianT on 05.17.11 at 9:29 am

#66Mike-No-CMHC makes housing LESS affordable, not more afforadable and was never intended to housing more affordable-the simple mandate of CMHC is to increase mortgage debt in Canada. In the USA, these changes are only proposed now after they have literally sucked the country dry.

#80 Tim on 05.17.11 at 9:32 am

Vancouver up 77 percent in 5 years:

Got screwed waiting for the correction…

Does that mean if you bought five years ago you’d be selling today? — Garth

#81 Rocket Boy on 05.17.11 at 9:32 am

So Monday morning I got into my car, thinking .. ah, a new week – and as I looked for a decent radio station for my morning commute – I just caught the last bit’s of a commerical regarding how a townhouse complex (completed last October) had a few remaining units for sale – act quick – lol….

And as I thought of this blog – the radio personality started to talk about a group that claims on May 21st – an earth quake that will hit the Australian area – will be the beginning of the end – quakes will cause massive destruction up until October where man will be completely wiped out … how’s that for your morning commute –

What’s scarier – Real estate or this pending earth quake…

#82 bill C on 05.17.11 at 9:34 am

It will never happen here. I guarantee that our real estate will grow every year and never decrease. maybe a small decrease here and there. But we will average 6% per year. Dont put money in stocks or CIC .s. Buy real estate in canada. Why do you think the Chinese are buying here. Its 100% safe.
Its a sure thing and garth you can take this to the bank.
Also a great time to buy in Florida. I have 2 properties in FLA if anyone interested.

#83 J on 05.17.11 at 9:35 am


Your predictions would be accurate but for one thing which we can never underestimate–the stupidity of government, which is now becoming the shock absorber for corrections around the world. If house prices and what should be a huge correction are the natural results of an over emotional market, the government’s tendency to meddle and become the biggest loan holder in the country is also apparant (just look at them buying mortgages). I suspect when the drop comes the gov will do something stupid (beyond CMHC) and take on huge debt to save the bankers and calm the hordes.

#84 theletterM on 05.17.11 at 9:50 am

Good stuff Garth. Thanks (again!) for the education.

#85 Pat on 05.17.11 at 9:56 am

#316 Live Under Your Means on 05.16.11 wrote
“They didn’t have Green in my day”

Yes, what you’ve written is right, people used to lead simpler lives. But you are overlooking something very important – they used to have many children. Producing extra (more than 2) people is the biggest environmental pollution. They also used to make them at a younger age, this increases the population too.

#86 EX-Cowtown on 05.17.11 at 9:58 am

I get a kick out of people who view the CON government as fiscally irresponsible. Who can forget that in the midst of the finacial crisis, Harper did not want to piss away a single $ on a “Stimulus Package” as he viewed it as a total waste of time and money?

But the Libs, NDP and everyone else screamed for one, then later complained about the deficit it created.

And that is why we needed a majority government; sometimes harsh measures have to be taken for the greater good. And those measures mean saying NO to a bunch of spoiled financially illiterate and irresponsible brats, namely the CDN voters.

So be prepared for some tough love comin’ out of the gate as Harper has five long years for us to forget about it.

#87 Opportunity on 05.17.11 at 10:00 am

Is there a difference between CREA and Bernie Madoff.

Both are putting out information that is not necessarily factual and trapping unsuspecting people.

Can we have CREA charged as their self interest is to fill the pockets of their member brokers as Bernie did for himself and family.

I smell a class action lawsuit coming here.

#88 BrianT on 05.17.11 at 10:02 am

Typical MSM-the headline has little to do with the content-“French outraged by US treatment of Strauss-Kahn”-the French people aren’t outraged-his cronies are-the French people hate this scumball

#89 Daystar on 05.17.11 at 10:18 am

Back from the cooler…. what’d I miss? As I begin to warm up very gradually, (it was a serene, spiritual place of needed reflection, an excellent instrument in Garths tool box) hmmmm…. TSX Ventures, a commodity laden market is below 2000. Home depot has weak sales. Let me put on my shocked look. My oh my, I am so shocked. Who would have ever thought commodities would sell off? Inventories building they say? QE2 over in June? Ugly numbers coming from Japan and other nations in July?

Housing in Canada hits the skids? Oh, I’m so shocked. Maybe things will change as I warm up… not. ;)

#90 Alex on 05.17.11 at 10:24 am

#70, Kilby: I saw that local Global TV news report this morning in a different way. It discussed “sky high” prices in the Vancouver west side, it mentioned that the average home in Vancouver now costs 9.5 times median incomes, it essentially “blamed” offshore Chinese buyers, and it suggested anyone wanting to buy a house will have to wait for some time, presumably for prices to drop.

It did not, thankfully, come across as a “buy now or be priced out forever” pump piece. Indeed, one could quite easily see it as one of the few “realistic” spots Global news has aired in quite some time.

Baby steps…?

#91 mario on 05.17.11 at 10:25 am

Stop giving adivce. You are wrong. A correction will mean nothing. A bubble is a bubble.
You advise people not to buy houses and rent since 2007 and that screw them up. The same house in Toronto that was 700000 in 2007, now sold for 1 milion.
A correction of 30% will mean the house will be back to 700000. Big deal. In the meantime I spent a fortune on rent for 5 years. Is that a good deal?

As opposed to spending it on interest? BTW, I don’t advise. I just comment. If you were too wimpy to buy in 2007, it’s your issue. — Garth

#92 Utopia on 05.17.11 at 10:33 am

#76 AG Sage

“CMHC was build to help with AFFORDABLE housing. Why is it insuring jumbo mortgages in the first place?”

Yes, good question. And why is the whole country in effect subsidizing the insanity of these home purchases?

I am all on board with effective programs that level out the highs and lows of our national economy and keep the wheels greased for the good of all but there is unfairness built into this system too.

Is there an equivalent program in magnitude to offer affordable housing for those on low incomes for example? It is amusing to me how the typical person screeches about all the benefits of the poor while taking some of the biggest handouts ever offered in our countries history.

Yes, CMHC insurance amounts to a taxpayer subsidy for home buyers. There is a near certainty it will not be able to meet its obligations when our real estate markets finally sink.

We do not offer renters subsidies as a matter of public policy like we do buyers, now do we?

#93 BrianT on 05.17.11 at 10:38 am

This guy would be the President of the USA if he had been born in the country-they worship the guy-maids are all over the news,0,1994592.story

#94 JohnnyBGood on 05.17.11 at 10:46 am

Garth said to #80 Tim: “Does that mean if you bought five years ago you’d be selling today?”

How true. Trading assets profitably not only means knowing when to buy. It also means knowing when to sell. Most of us don’t know how to do either.

In any event, treating your home like a tradable asset is stupid, IMO. The wealth effect is a very dangerous thing when assets are overvalued.

#95 Desi on 05.17.11 at 10:51 am

New mortgage rules crimp home sales

#96 Andy In Vancouver on 05.17.11 at 10:59 am

OK, we made Bloomberg – same thing as Financial Post Article:

Title “Chinese Spreading Wealth Make Vancouver Homes Pricier Than NYC”

#97 Cash is King on 05.17.11 at 11:06 am

Technology vs employment fight continues with technology winning again.

I wonder if the touch screen terminal will include a slot for gold coins or silver bars ?

#98 Teddy R on 05.17.11 at 11:06 am

I keep hearing out there HAM is alive and well.
They are relentless and they love Vancouver.
with Australia restricting foreigners buying, Vancouver will just get all this extra HAM comin.
i liken this to a clearance bin in Superstore, all you see are packs of Asian vultures devouring what is left and wanting more.

#99 OttawaMike on 05.17.11 at 11:10 am

#89 Daystar on 05.17.11 at 10:18 am

You’d better repost that one Daystar, it somehow got truncated at 150 words..

#100 Kevin on 05.17.11 at 11:11 am

Mortgage credit growth is still growing at 7% year over year, more than incomes and GDP. More tightening coming in the next budget or fall is possible.

Here is how CMHC has lowered the bar of home ownership over the years.

1954- CMHC introduced Mortgage Loan Insurance, taking on mortgage risks with a 25% down payment, making home ownership more accessible to Canadians.
1954-1990- Somewhere along this time, 10% became minimum down payment.
1990- 5% was introduced as a trial run, then officially accepted in 1999.
2001 – Genworth (GE Capital) enters the Canadian mortgage insurance market
2001 – CIBC offered below-prime mortgages.
Pre-2003 – CMHC: 5% down with price limit depending on area, 25 yr amortizations, no price limit if 10% or more down
Sep 2003 – CMHC: 5% down, 25 yr amortizations, removed all price ceiling limitations. Now any mortgage would be insured regardless of the cost.
Mar 2004 – CMHC: Flex-Down product allows 5% down to be borrowed and 1.5% closing costs to be borrowed (essentially zero down, but 95% insured)
Mar 2006 – AIG enters the Canadian mortgage insurance market
Mar 2006 – CMHC: 0% down, 30 yr amortizations (Genworth anounces 35 yr amortizations)
Jun 2006 – CMHC: 0% down, 35 yr amortizations, interest only payments allowed for 10 years
Nov 2006 – CMHC: 0% down, 40 yr amortizations, interest only payments allowed for 10 years
Oct 2008 – CMHC: 5% down, 35 yr amortizations, investors need 20% down.
April 2010- CMHC did some minor tightening of their guidelines.
Mar 2011- CMHC: 5% down, 30 yr amortizations,

CMHC: A Danger to Canada’s Economy?

#101 Utopia on 05.17.11 at 11:14 am

#65 Sid

Try this Sid. Here is a link of the Horizon Beta Pro funds. Click on the link and then go to “ETF Products” to see a current list of options they offer. Swing traders love these of course and play both sides daily. You make money coming and going as long as you can cover your costs for each trade. Plenty of volatility helps.

As one example (HOD) is an oil short. Think “Horizon Oil Down” to keep the idea in mind. (HOU) on the other hand is an ETF that anticipates rising oil prices. Think “Horizon Oil Up” There are dozens more to check into and they all list on the TSX so no worries over losing money on exchange rate differentials.

You can also lose your shirt if the market turns angry on you unexpectedly. Playing swings is not really for the faint of heart but lots of people think it is even more satisfying than sex.

I think it takes a certain kind of Jungle-boy hunter mentality to stay on top of it and too many guys get glued to their computer screens for hours at a time waiting in anticipation for the expected reversals and bounces to happen.

Lots of fun until one day you get trapped into a trade you are forced to hold over the weekend……..then suspense…..then Monday morning it does not go your way. OH No!!! It can be terrifying.

Just like good sex.

#102 JohnnyBGood on 05.17.11 at 11:25 am

#74 disciple

Point taken, but try to stick to reality. A mortgagor is not going to pay three, four, five, or six times the value of their house in principle and interest, if that’s what you meant. Even if based on the high side of current rates, a 25 year am would cost you just over double the borrowed amount in principle and interest. However, if house prices continue to appreciate at near the average, historical rate of inflation, the value of the home would also double in that time frame. If higher inflation caused higher rates, the property value would also appreciate faster, commensurate with inflation. The fly in the ointment could be if real estate has gotten so overvalued in a secularly stagnant economy that it becomes a generationally reviled asset for socio-economic reasons and single family homes become a long-term non performing asset.

As to your “renting the Queen’s land” comment. You’re almost correct in that in Canada land owners hold their land in fee simple. But that’s not the same as renting. Renters have no ownership rights. True allodial ownership, where you have no obligations to a superior (e.g. government) is very rare. In the US, they have something similar to fee simple called eminent domain. In any case, don’t conflate fee simple with renting. It’s not the same thing at all.

#103 GregW, Oakville on 05.17.11 at 11:26 am

Hi #40 Nostra, Thanks for the last few links.
Have you seen this story yet, May 17?

TSA backscatter radiation safety tests were rigged

#104 kilby on 05.17.11 at 11:28 am

#90 Alex. I see what you mean about affixing the “blame” on the Chinese buyers. It does send a signal to other Canadians that they should not bother about moving here as they can’t afford to. Lots of potential there, if I had been dreaming of selling my mid-Canada home for a temperate climate retirement I would probably be thinking of staying where I was and maybe taking a bit more time vacationing down south.

#105 GregW, Oakville on 05.17.11 at 11:39 am

Hi Nostra, Here’s an article/interview(May 17) with the former Fukushima nuclear plant manager 1997 to 2000.

“The Scale of the Accident Was Beyond My Imagination”

#106 HouseBuster on 05.17.11 at 11:47 am

Let’s get real here. Housing in Canada is imploding as we speak.

#107 realpaul on 05.17.11 at 11:48 am

So….who was saying what about the Mainland Chinese ( Foriegn national non Canadian Chinese for all the left over PC Liberals who want to kneee jerk and bark every time a referance is made to any non white and start screaming rasist,bigot…bad man……in unison…on cue). The fact is that this wave of foriegn nationals has created aa severe problem for local buyers. The tax and currency regime of the two countries make it so uneven a playing field that Canadians are disadvantaged from the get go. It was the same when the Liberals had driven the Canadian dollar down to peso status and attracted scads of Americans to the local market. Because these people pay far less in personal direct and indirect taxes…it makes for a losing proposition for Canadians to try and compete.

I seem to recall we’ve had a Conservative government for the past five years. — Garth

#108 BPOE on 05.17.11 at 11:53 am

The truth hurts sometimes Garth
The US is not ready to default. You are an idiot. — Garth
In Geithners own words
“Failing to raise the $14.29 trillion debt ceiling would “force the United States to default” on obligations such as payments to service members, citizens, investors and businesses, Geithner wrote.

The debt ceiling will be raised, of course. You are still an idiot. — Garth

#109 Derek on 05.17.11 at 11:56 am

#90 Alex on 05.17.11 at 10:24 am

Baby steps…?

Baby steps, alright. Meanwhile on Global’s Calgary morning news, there was a report on the Mayor’s drive to reduce the amount by which Calgary taxpayers subsidize developers of new housing on the city outskirts.

Currently when a new development is created, developers only pay for the construction of the houses themselves. The infrastructure is paid for by existing Calgary taxpayers. The city charges developers a levy to recoup this subsidy but it is currently only half the true cost, so developers are currently getting a massive handout from city taxpayers.

Imagine my surprise when, rather than reporting this as a reduction in subsidy, Global chose to report it as a an increase in taxation on the developers! Yeah? Well what about my taxes! If these “developers” can’t pay for their developments, why do they expect me to pick up the bill?

So if Global’s spots are changing, it’s happening pretty slowly.

#110 BPOE on 05.17.11 at 12:01 pm

You see folks The American and his drones are not going to stop the REAL estate crazy train in VanHatten. Folks, I agree totally with Garth’s assessment on Canadians and debt load. I do not agree with his assessment on Vancouver. The amount of wealth coming in is incredible. No where in the world is money flowing in at such an incredible rate. Folks a dumpy house in Arbutus is worth double a house in Maui! Think about that? It’s not about a bubble. It’s about PERCEIVED value. It’s what everyone wants and what The American will never understand as he furiously pumps in numbers into his calculator and drinks second rate US coffee while stuck on the I-5 with it’s wonderful freeway system.
Want to find out who’s telling the truth. Look at the FACTS. Look at the prices of Vancouver over the last 10 years. If they have gone down then The American is right. If they have gone up then make no mistake in your mind The American is no less than fool Shiller. Shiller is truly The Biggest Fool in his assesment on Vancouver. Doesn’t even have the class to state he has been dead wrong on Vancouver. Look at the chart and now you know who is telling the truth about BPOE
97 Andy In Vancouver on 05.17.11 at 10:59 am
OK, we made Bloomberg – same thing as Financial Post Article:

Title “Chinese Spreading Wealth Make Vancouver Homes Pricier Than NYC”

#111 Junius on 05.17.11 at 12:05 pm

#108 realpaul,

You confuse small “l” liberal immigration policy with big “L” Liberal party. In any event, they are all too blame but the Cons should be held accountable if they don’t fix it.

#112 Junius on 05.17.11 at 12:08 pm

#101 Kevin,

Thanks for laying it out there. The Cons move was in 2006. I believe Garth has a previous post on these events as he was in the cabinet at the time.

These were the moves where F and H sold out our future for short term gain when they knew what the ramifications were.

#113 grantmi on 05.17.11 at 12:09 pm

Chinese Spreading Wealth Make Vancouver Homes Pricier Than NYC

By Hui-yong Yu and Christopher Donville

May 17 (Bloomberg) — Vancouver’s Royal Pacific Realty had such a surge of business during the first two weeks of February that agents and assistants worked day and night shifts to find homes for Chinese buyers visiting during the Lunar New Year.

“It was unprecedented,” said Royal Pacific Chief Executive Officer David Choi. “I called them sleepwalkers.”

Ouch! We’re getting close to the top boys and girls! Bloomberg covering Vancouver in a piece! All the planets are lining up!!!!

#114 Junius on 05.17.11 at 12:09 pm

#111 BPOE,

You said, “Folks a dumpy house in Arbutus is worth double a house in Maui! Think about that?”

Yes, we have. We think it is completely nuts and will not last. Just like you.

#115 Utopia on 05.17.11 at 12:12 pm

#65 Sid

Sorry Buddy. I did not put the link in that I was mentioning before hitting the submit button. Old age, senility and all that crap must be getting my mind confused…..

Here it is:

Keep in mind that the Beta-Pro funds are not actively managed by anyone but you. It is your own coin and time that counts. These ETF funds are leveraged and are not meant to be held long-term but are rather useful at taking advantage of market volatility as it arises. Buyer beware of course. Read the prospectus before using them and get some professional advice. It is as easy to lose money as make it if you don’t pay attention.

#116 Michael De Young on 05.17.11 at 12:16 pm

It would be a whole lot easier listening to you Garth if you weren’t so God damned arrogant. You talk about people paying insane prices in Vancouver, as if they have an attractive alternative. Try renting in Vancouver.

I have lived in many places across this country and the life style, weather and attitude may not justify the expense, but you could give me a home in certain parts of Canada and the cost would still be too high.

It’s fine for you, with your knowledge of investments, to talk alternatives, but for many of us, it’s a throw of the dice. Which, shyster should a person trust?

I’m all for truth, in whatever form it comes, but your insulting attack on people who are at a loss for how to deal with the insanity gets to be a bit much sometimes.


Suck it up. Be a man. Move. — Garth

#117 Junius on 05.17.11 at 12:17 pm

#110 Derek,

You commented, “Currently when a new development is created, developers only pay for the construction of the houses themselves.”

This has been the pattern for 40 years and why we have Suburbia and now Exurbia. We don’t measure the externalities involved in any of the costs which not only include roads and services but schools, police, etc.

Look at a City like Edmonton where they are building their new Anthony Henday ring road around the city. If you travel up the Western portion you will already notice that the City has jumped West of the Highway. It is not a ring road before it is even completed. It will be jammed by the time it is done and everyone will want more lanes, etc. Ever been to LA?

Meanwhile inside the city are large portions of serviced areas near the downtown that are empty and run down because the costs of re-development are “too high”. However if you factored in the fact that the services already exist they are actually much, much cheaper.

You can find examples like this in every Canadian city. If the developers are running the system then it will always be “cheaper” to build on farm land in West Flamboro, Spruce Grove, Airdrie or Abbotsford.

#118 realpaul on 05.17.11 at 12:21 pm

But G-Man……it would do to recall that we’ve had a ‘minority’ Conservative government for five years. It has been a hamstrung parliament that has had this countries wheels stuck in the mud because of the nessesity of pandering to all the special interests.

Now…for all the left over PC lapdogs….heres a national story of fact and forensic analysis that is bound to have the brainwashed generation slapping their flippers together in unison.

The fact is that we are not only subsidizing the takeover of local neighbourhoods by non Canadian foriegn nationals…we are also subsidizing the new entrants who have crushed the economies ability to provide basic services to the the host country….thats us by the way. Its one thing to feel guilty that you were born in the once great country …but to piss it all away in give aways to goriegn nations because you have been taught that it is the PC thing to do is the height of Liberal lunacy. Go ahead …bark and slap thinking that the screaming will make the opposition will go away.

The fact is that the Liberal Party dictatorship and the tyranny of the loonie left has pushed this country’s face into the mud. Until all the Liberal policy is reversed this country will have a very hard time getting to its knees. The turn over in the Liberal dominated SCOC and Senate is a start…but it may take decades to reverse the damage that has been done.

“Pandering to special interests” = democracy. You are why only 24% of the country voted for S. Harper. — Garth

#119 realpaul on 05.17.11 at 12:24 pm

Whoops..heres the story

#120 Junius on 05.17.11 at 12:33 pm


Your developer peeps in China are having a tough time of it. Looks like you and their days are numbered. Better start working on Plan B.

This from MarketWatch:

“The debt carried by China’s real-estate developers jumped 41% in the March-ended year from the same period 12 months earlier, according to a report by Chinese state media.

The value of unsold houses was up 40.2% to CNY903.5 billion, the Xinhua report said. Average profit was down 4.9% to CNY54.65 billion yuan.

Chinese government measures designed to cool the housing market have made it harder for real-estate companies to replenish their working capital by quickly selling apartments.”

#121 bigrider on 05.17.11 at 12:37 pm

#91 Mario and Bill C at #82

A couple of brick licking, lumber humping Italians for sure.

#122 confused and a little crazed on 05.17.11 at 12:37 pm

111 US Defaults???

are u kidding?
if they default the whole economic world would crash…talk about squirrel soup and “guns R Us” scenario. their consumption is more than 10 x Canada and that’s at our consumption debt level of 1.47x our income.

most of the Fortune 500 companies are there….so US will raise the debt ceilining to another trillion and investors will buy their debt in the form of bonds and/ our the govt will print more money and buy it themselves like how they bought the mortgages from FAnnie/ freddie

#123 grantmi on 05.17.11 at 12:41 pm

Here’s a comment from the Victoria Agent from the last post about my comments on WHY there were so many empty homes for sale in THE LAND OF THE DEAD! (or nearly)

#1 written by Grantmi
about 1 day ago
Reply Quote

More info. Fergus! WHY are the homes empty! Please give us more detail on this. You must know why. New homes, Absentee asian owners bailing, reno developers buying up beaters fixing them up, but can’t sell them now. etc. etc.

#2 written by Fergus Kyne, Re/Max Alliance Victoria, 250 386-8875
about 1 day ago
Reply Quote

Well there are a lot or reasons why homes are vacant, and as far as I can see, it’s a combination of all those things you’ve suggested here as I’ve seen examples of each one of the type of situations you describe. Dev. your reno developers are not selling as quickly as before or for as much profit.

#124 Dontcallmeshirley on 05.17.11 at 12:43 pm

Of course domestic house trading is neither efficient nor an optimal use of capital; but clearly Mark Carney is un-concerned that Canadians have been doing so for about 10 years now.

Plenty of capital floods into Canada because of commodities.

Plenty of capital begets plenty of real estate transactions.

Figure out when the commodity rush ends and you’ll also know when Canadian real estate stumbles.

Until then, there is time to trade.

#125 bystander on 05.17.11 at 12:44 pm

CMHC is not at risk. The government is, hence the whole country. Wait and see, when reality bites.
And as long as foreigners keep buying Canada government debt, things will continue on. And they have been, thanks to F & C massive marketing campaign codenamed “Envy of the world”. That campaign worked well, and if you’re smart enough, the time to exit is now. Well the door for exit has been quite crowded since March. The best hedge is to sell $CDN, REduce exposure to commodities. Park your money in the emerging economies. Whatever your investment plan is, find opportunities that meet your goals. Russia is amazingly cheap, and attractive. Their currency has been a steady performer for the past 6 months. The upside potential is multiples of what we are facing here in Canada. At the same time here in Canada, we are facing a massive downside, whether you’re in commodities, cash, or stocks. Higher CDN is killing us, sliding commodities, maxed out borrowers. Boomers heading for exits, and reducing spending in their late years. Who is going to consume? Immigrants?
Why would anyone on earth think that Canada will be able to attract as many immigrants as before when quality of living deteriorate? Think again.

#126 bigrider on 05.17.11 at 12:44 pm

An update on condo project at yonge and eglington soon to open for sale, sept/oct2011

630 sq. ft units start at 380,000 and a parking space is $45,000. Building will be above store front(a negative) and premium south facing units below the 22nd floor will have the wonderful view of a tall nursing home building soon to be built as well,behind it as an attraction.

4 people I know are buying a unit each as an “investment”.

Yes, all four Italian.

#127 45north on 05.17.11 at 12:59 pm

BPOE: here you go:

Sales of detached homes, townhouses and condominiums in metropolitan Vancouver jumped 70 percent in February from January, to 3,097 units from 1,819, and were up 25 percent from a year earlier

so how do sales in April 2011 compare to sales in April 2010?

In 2010, Vancouver had the third-highest housing costs among English-speaking cities worldwide, according to Canada’s Frontier Centre for Public Policy. Only Hong Kong and Sydney, another magnet of Asian immigration, were more expensive. Vancouver’s median home price of C$602,000 ($618,000) was 9.5 times the annual median household income

9.5 times the annual median household income! lets call it 10 times. This means the Vancouver market has decoupled from the economy.

Mr. Buyer: I was shopping around for a house last week in Ottawa

Here in Japan

is this the same My Buyer?

Garth when two people can post with the same name it is confusing. Worse some posts are just anonymous rants – chaotic, random and disassociated.

#128 disciple on 05.17.11 at 1:03 pm

Economics they don’t teach you in school, lesson #9:
Unequal reciprocity: buying low, selling high – where does the increased value originate? Answer: nowhere. It is a figment of the imagination imposed upon the buyer through monopoly of resource acquisition. That figment of the imagination is called “currency” and those that have swindled the “right” to create it out of nothing perpetuate the dream. If that figment of the imagination is tied to actual labour performed and not on the promise of future labour, then that currency acts as a medium of exchange ONLY, and serves to enrich ALL. Jesus was crucified because he got angry with the moneychangers. Please make the connection in your minds and understand these truths…

#129 new_era on 05.17.11 at 1:12 pm

Garth – Vancouver keeps trucking along

Friend of mine just listed a house on the border of east and west vancouver. Asking for about 700,000.

There were multiple offers and now a bidding wat the thing is up to 900,000 right now and people are still bidding.

Freakin insane.

#130 disciple on 05.17.11 at 1:17 pm

Economics they don’t teach you in school, lesson #8:
Technology does not take away jobs, rather it raises the standard of living for ALL. Technology will eventually save us from ourselves, once we understand that everyTHING is rightfully FREE. This is why knowledge is held so sacredly esoteric (hidden) by the elite because knowledge is what will break the chains of bondage that they have held on us for so long. Jesus (and his twin brother) were trying to give us some of this knowledge. All those throughout our wretched history that have attempted this have all been attacked. It will continue to happen unless these brave souls are supported by the educated masses.

#131 BrianT on 05.17.11 at 1:28 pm

#120Real-It is the definition of a Ponzi scheme-the actual cost to the economic well being of the country is irrelevant to those running the scheme-what is interesting is why they are choosing to inform the sheeple at this point.

#132 Burnt Norton on 05.17.11 at 1:35 pm

#117 Michael De Young on 05.17.11 at 12:16 pm


As someone who has been involved in the Vancouver residential rental market (both tenant and landlord) for years, I can tell you that if you can’t find a nice place to rent in Vancouver you’re not looking hard enough.

#133 Abitibidoug on 05.17.11 at 1:39 pm

Garth said: It means the feds are subsidizing risk, of course. And there’s nothing conservative about that. If you get my drift.

Yes, we do get your drift. It appears, contrary to the propaganda we’ve been told, that the communists really won the cold war. During my stay in Ottawa I never bothered to visit the CMHC headquarters, it’s not on the tourist’s list of what to see and do. Tell me, is there a statue of Karl Marx in front of the place?

#134 Jamie Groulx on 05.17.11 at 1:40 pm

@#24 Mr.Buyer. I agree completely.

The Boomer generation is the true definition of self entitlement. The damage is flooding not only into the generations to come, but has managed to creep into the one prior. Thanks to said self entitlement and HELOCS on property owned by boomer spawning golden-agers.

Christopher Dodd wasn’t kidding when he said that “Our Nations Children are our most precious treasure”

#135 Sail1 on 05.17.11 at 1:41 pm

Seems like it makes no difference in cost if sales are down.

OTTAWA—The national average home price rose by eight per cent last month even as housing sales fell by 14.7 per cent from the year before, according to data released Tuesday.–home-prices-climb-8-despite-drop-in-resales

#136 cash on 05.17.11 at 1:47 pm

We keep seeing the same thing over and over and nobody learns. It’s “different” this time. Yes, I suppose each one is “different”. But it always ends the same. We had a housing bubble and crash in Toronto in the late 1980s which took until the mid to late ’90s to deflate. Did we learn from it? Nope. We had a vicious crash in Calgary in the 1980s. Did we learn from that? Nope. And now another calamity in the US. Did we learn from that? No chance. Ten years after this bubble pops the grinning real estate chimps will be back at it touting the same old stuff. Will we have learned? Not a bit.

#137 Mr. Reality on 05.17.11 at 1:53 pm

BPOE – 73% of our exports go to the US. They run our economy. If they defaulted and they won’t, we would be destroyed. Your unfounded arguments prove you know nothing about what you are talking about.

Wake up

Mr. R.

#138 Alex on 05.17.11 at 2:01 pm

#115, Junius: Nicely worded, dude. :-)

#100, Derek: Absolutely agree. Yet I can’t help but think that the spot on Global Vancouver this morning could easily have been slanted in another direction. I mean, this is Global we’re talking about here, the home of “This segment sponsored by ReMax.”

I was at least moderately heartened that it didn’t come across like another BNOBPOF pump job.

#139 Steven Rowlandson on 05.17.11 at 2:20 pm

Hello Garth.
You wrote: “In both Canada and the US, the government stands behind mortgage insurance.”

I think this is some thing that can be cut from the Federal Budgets north and south of the border to help cut deficits and impose a bit of sanity on the banks and the real estate market.


#140 The American on 05.17.11 at 2:42 pm

BPOE, again you spew lies. Its okay, though. We recognize you for what you are; You are a lying, lowlife realturd. That’s it. :-)

BPOE, you clearly do not understand the debt ceiling and how it is managed within the U.S. No default whatsoever. Debt ceiling will be raised just as it has time and time again in the past. Get used to it.

As for Vancouver, well the correction has begun and you know it! You wouldn’t have the time to sit on this blog all day, every day and type away if you were so busy. You try too hard, which is very telling. The Chinese are stopping the madness as their economy begins to implode (just as I said it would) and the funds are coming in at a glacial pace compared with only a year ago in Vancouver. Areas in greater Vancouver are now showing signs of significant strain and property values are dropping, including significant price drops on new construction and resales. Also, permitting for new construction is on a MAJOR downward swing in Vancouver and throughout Canada in general. Yep, looks like the party is over for you, BPOE :-) Garth is right and you lose.

One last thing, you continually make shit up and insult people’s intelligence by making claim that Vancouver’s market has gone up in the past 10 years. I’ve got news for you, liar, property values have gone up in EVERY market in Canada, Europe, Australia, Asia, and the U.S. (yes, even in our downtown of prices) from today to only 10 years ago. Just because they’ve gone up in Vancouver in the past 10 years, just like they have everywhere else on the globe, does not mean they won’t be coming down, just like they have everywhere else on the globe. If we want to apply your “logic” then it is a GUARANTEE Vancouver will have a 40%+ market collapse in values. The problem with you, BPOE, is you want to use cherry-picked information that will support you on the upside, but you don’t/fail to recognize the same “logic” applies on the downside. Every market went up, every market has come down (including the beginning of it in Australia). Vancouver is next. Can you say, “Would you like fries with that? Apple pies are now only 2 for $1!”

Yes, yes, I think that would probably be a fitting position with someone of your failed ability to comprehend and insistence on lying to the consumer base. Face it, you know I am right. Ciao for now, mother f**ker!

#141 The American on 05.17.11 at 2:46 pm

At #140: Steven Rowlandson, you are spot-on!

#142 BPOE on 05.17.11 at 2:48 pm

The American will spread lies that these stories ar fake. But there not fake folks. This is REAL and it’s BIG TIME. Life changing for the better being an owner while The American, Junius and Co made a UFD Unrecoverable Financial Decision. Keep those stories rolling folks. No stories have emerged how renting was better than buying over the last decade
130 new_era on 05.17.11 at 1:12 pm
Garth – Vancouver keeps trucking along

Friend of mine just listed a house on the border of east and west vancouver. Asking for about 700,000.

There were multiple offers and now a bidding wat the thing is up to 900,000 right now and people are still bidding.

Freakin insane.

#143 The American on 05.17.11 at 2:51 pm

At #36: BPOE, by the way, Seattle has SIGNIFICANTLY wealthier people than Vancouver. Van has a little money, but nothing like Seattle. More millionaires per capita BY FAR in Seattle than Vancouver, and Seattle has one of the largest concentrations of billionaires anywhere in the world. Get used to it. It will only worsen for you as your market goes down. I’m not going to let you get away with your bullshit any longer. :-) Ciao for now, mother f**ker!

#144 BPOE on 05.17.11 at 2:51 pm

Mr. Reality you need a wake up call. This is Geithner talking not fool Shiller. Very good chance the ceiling will not be raised. AS IS U.S IS GOING TO DEFAULT PERIOD.
Mr. Reality on 05.17.11 at 1:53 pm
BPOE – 73% of our exports go to the US. They run our economy. If they defaulted and they won’t, we would be destroyed. Your unfounded arguments prove you know nothing about what you are talking about.

Wake up

Mr. R.

#145 Jamie Groulx on 05.17.11 at 2:55 pm

P.S. The end of times is on a Sat this year, come Friday I’m going to party like it’s Y2K! See you all on the dark side!

#146 Brad in Van on 05.17.11 at 2:57 pm

BPOE: Did you know you couldn’t be more wrong? Did you know Seattle is one of the wealthiest places on Earth? Did you know Vancouver has amassed only less than half the wealth of Seattle? Vancouver is almost a poor place compared with SeaTown.

#147 Brad in Van on 05.17.11 at 3:02 pm

They may have beaters, but they’re secure in their wealth. As I’ve said numerous times, that’s why I love Seattle. They don’t give a damn what people think because they don’t HAVE to give a damn. They have real money and when you have real money everything else doesn’t really matter. We like to put on airs around here. Everyone driving around in their fancy car here is doing it on borrowed time and money from the lines of credit they’ve taken out on their overpriced homes. They aren’t using THEIR money to buy these fanciful items. They’re using the bank’s money from lines of credit, using their houses like a piggy bank. Watch how many people lose not only their homes but also their cars too when the values plummet.

#148 no guts on 05.17.11 at 3:12 pm

#49 somecatchphrase on 05.17.11 at 12:32 am
Today’s post gets at the true heart of the matter.

When people are forced to spend 30%+ of their income on one of the basic necessities of life, it starves the broader economy of capital that could be put to a better use.

My thoughts exactly. Well put. High housing prices destroy the general economy.

#149 jess on 05.17.11 at 3:27 pm

Indian village district some of these sold for over a million at peak

$349,000 – 1470 Iroquois St, Detroit, MI
2481 Seminole Detroit, MI 48214 $132,000
1410 Iroquois St Detroit, MI 48214

#150 Utopia on 05.17.11 at 3:28 pm

#136 Sail1 remarked on the following from an article published today in where the average of prices have increased concurrent with a decline in the number of sales.

“Seems like it makes no difference in cost if sales are down”.

Actually, Sail1 it does make a difference. What we are seeing now is a classic market top where prices rise on declining sales. It is an ominous sign for real estate exactly as it is for the stock market when similar overbought conditions occur.

You know all about the fact that more than 70% of Canadian families already own a home, no doubt. You will also be familiar with the idea that too many owners is equivalent to very few new buyers.

So who is buying?

Money is buying of course. It has no boundaries. Cash does not care what typical market prices are when it seeks to satisfy its own demand. So prices rise on average despite the fact that the bulk of buyers in the median of income ranges have already exited the market.

You are correct though if you are only looking at average prices. The market is very skewed right now in some postal-codes by the sale of high-end homes. This in fact was implicit in the article you mentioned where the author wrote…

“The national average home price has been skewed upward in recent months due to a surge in sales of multi-million dollar properties in the Greater Vancouver area”.

That says it all.

Think this through for a moment. High end homes are keeping the average price high. Not just for Vancouver. For the whole country for cripes sakes

This is both the beauty and the bitterness of statistical rationalizations in a fantasy land of numbers for Real-turds who can thus promote the figure to show the market rising when in fact for most it is actually in decline! Go figure. Real-tards are actually pretty smart when it comes to earning commissions from the last of the virgins and those who can’t read or understand numbers.

The profession is really despicable. Not a profession at all.

We all need to get our heads screwed back on straight. Property sales are in decline all across the country. That is a fact. Ten months running now.

Prices are in outright decline in many markets. It is a rout, a disaster for many already. The fact that overheated places like Vancouver and Toronto can distort national numbers by virtue of “averages” is no consolation prize at all.

That is just a manipulation of data that only serves the Real-tard class of real estate pumpers. Guys like Cam Muir for example who are paid by the lobby and have a vested interest.

Guys like the home-pushers who distract us by playing games with statistics too. The soul-less sellers and data managers we despise because of what we perceive to be their complete lack of honest candor and professional ethics.

The rest of us should be very, very wary about buying now as the debt bomb is close to going off in this country. The dreams of countless newbie buyers and millions of elderly sellers is about to go up in smoke.

Too bad. They would not listen or heed the call to sell when the message was crystal. They will hear it when it is like a nasty shot to side of the head though.

A shot to the gut too. Hearing aid anyone?

#151 jess on 05.17.11 at 3:43 pm

lesson #8:
Technology does not take away jobs, rather it raises the standard of living for ALL.

… patents for humanity?

the uk published a report saying the pay gap is at a par with victorian times…

Defenders of high pay talk about executives being poached by international competitors if they don’t pay well enough but only one FTSE 100 company has had its CEO poached by a rival in the last five years – and it was by a rival British firm.
Defenders of high pay talk about executives being poached by international competitors if they don’t pay well enough but only one FTSE 100 company has had its CEO poached by a rival in the last five years – and it was by a rival British firm.
“In 2010, chief executives of FTSE 100 companies were paid on average 145 times the average salary. Back in 1999 the multiple was 69. On current trends it will be 214 by 2020, or around £8m a year.”

Joseph Rowntree Charitable Trust, funder of the High Pay Commission (and of TJN) for supporting this important work.

#152 BrianT on 05.17.11 at 3:47 pm

#141Moron-Why don’t you just pick up your toys and go home-why waste your time on a foreign blog.

#153 Havingagoodtime on 05.17.11 at 3:47 pm

Has anyone noticed that no one writes in anymore that Garth is crazy for suggesting home values will drop? Iv been reading this blog for a couple of months and reading the comments the number of people writing in disagreeing with are are less and less every day. Now their are none. Garth be careful no ones going to read this anymore when your right.

On a side not why aren’t the treb numbers in for mid may yet? Usually their out by now. I guess their having a hard time spinning poor sales for may.

#154 John on 05.17.11 at 3:56 pm

Hey Garth… can you send me the link to the Vancouver tear-down for $730k? That’s a bargoon!

#155 Junius on 05.17.11 at 3:59 pm

#144 The American,

It is not even about the millionaires. Seattle has real companies from Microsoft to Amazon. Vancouver, not so much. Just try and get any of these pumpers to try and understand that Real Estate is a derivative industry that only raises in value if people have money from the primary economy.

He is totally delusional but once again if he wasn’t here spewing it I would have to explain to people how many BPOEs live in this crazy town.

#156 Thirty something on 05.17.11 at 4:03 pm

So much hilarious news on CBC radio today:

First they are talking about Carney being a candidate for head of the IMF. Get in there quick Carney, before the jig is up!

Then a piece on how the address # (8 being lucky, 4 being unlucky in chinese culture) can effect the value of real estate. Something else to panic the masses!

#157 The American on 05.17.11 at 4:03 pm

BPOE, let’s make a deal. When the U.S. does raise the debt ceiling, you agree to leave the blog for good and wear a t-shirt that says, “BPOE IS A DELUSIONAL LIAR!” If the U.S. does not raise the debt ceiling, I agree to leave the blog and wear a t-shirt that says, “BPOE IS A DELUSIONAL LIAR!” Deal? Let me know, okay? Ciao for now, mother f**ker! :-)

#158 Junius on 05.17.11 at 4:03 pm

#131 disciple,

You said, “Technology does not take away jobs, rather it raises the standard of living for ALL.”

Simply not true.

In economic textbooks perhaps but that is predicated on the companies that become more efficient from technology either paying more salaries or more taxes into the system. Neither has been the case for decades. Add in outsourcing, offshoring and paying taxes in other jurisdictions and the benefits end up accruing to the lucky few who got in early.

Technology is neutral in itself. It is about how we use it and share the benefits.

#159 Utopia on 05.17.11 at 4:06 pm

#146 Jamie Groulx on 05.17.11 at 2:55 pm

“P.S. The end of times is on a Sat this year, come Friday I’m going to party like it’s Y2K! See you all on the dark side”!

Could you be more specific? I have family plans. Which Saturday, pray tell, are you referring to? I could use a date so then I might adjust my busy social calendar.

Oops sorry….are you just another of the nuts on this site?

#160 Devore on 05.17.11 at 4:06 pm

#16 Mr Buyer

I mentioned to the Realtor that I was paying cash but she said it did not matter to her.

Irrelevant. Today, anyone with a pulse can get a 30 year mortgage instantly with 5% or less down. Cash purchase only matters when offers are conditional on financing, and financing is tight, like in the US, then cash offer is preferred.

#161 Live Under Your Means on 05.17.11 at 4:15 pm

#98 Cash is King on 05.17.11 at 11:06 am
Technology vs employment fight continues with technology winning again.

I wonder if the touch screen terminal will include a slot for gold coins or silver bars ?


So customers save 3 or 4 seconds, but can’t pay cash. I’ve only been in a McDo 2X in the last 25 yrs – more out of necessity. I never use those scan your own at Loblaws – even for a few items. I’d rather support people working, even if the job is low wage. And, you can’t chat about the weather, or whatever, with a machine.

#162 realpaul on 05.17.11 at 4:22 pm

G-Man…you can’t call the one sided tyranny and dogma of Liberal Party ideologues a democracy either. If percentages spoke about democracy then the Liberal Party would have never enjoyed a single majority government. Pierrre Trudeau and Marc LaLonde carved up the city of Toronto into enough newly created seats to form a ‘majority government’ and never held any ‘majority’ .

During the ‘occupation of ottawa’ by the leftists and special interests the rest of Canada ( particularily the west) was told to go to hell and that our progressive convervative values didn’t matter. We saw the wealth of the nation pissed away and whenever anyone spoke out they were shouted down by the rabid ideologues of the Liberal Left.

The decades of Liberal tyranny were hardly ‘democracy’. It was ‘my way or the highway’ and the Cunab style autocrats of the Liberal left wrought havoc to the country by way of inporting flaky policy…which by the way has now been strongly objected to ny the very countries that introduced the idiotic programs in the first place. Stuck in a time warp of their own arrogance the Liberal Left refused to admit its mistakes and dragged Canada further into a morass.

Liberal leftists have once again proven themselves to poor managers of the public trust…..and sore losers to boot. Without the Canadian people voting the bums out we would still be swirling down the Liberal toilet.

The ‘poor managers of the public trust’ were the last ones to achieve a balanced budget, leaving S. Harper with a surplus in 2005. By 2010 it had turned into the nation’s worst deficit. So much for ideology. — Garth

#163 Brad in Van on 05.17.11 at 4:34 pm

BPOE, chew on this for a while:

#164 April Showers on 05.17.11 at 4:45 pm

@152: BrianT –

Who pooped in your oatmeal this morning? You didn’t like what The American had to say? His analysis is always interesting and accurate and he’s been right so far with everything he’s been predicting. Maybe you should stop being so snide and proud and take a little caution. Do you not like him because he is American? Or? My husband and I actually enjoy reading a perspective from someone who isn’t so close to the forrest that he can see what’s coming our way. I have to admit you are pretty anti American in everything you post. Remember we’d be little to nothing and wouldn’t enjoy our current quality of life without them. Food for thought.

#165 poco on 05.17.11 at 4:54 pm

#156 Thirty something
Then a piece on how the address # (8 being lucky, 4 being unlucky in chinese culture) can effect the value of real estate. Something else to panic the masses!
lots of properties listed with the “8” factor

this one must be real lucky –4×8 in the mls#

#166 Bruce on 05.17.11 at 5:02 pm

Implosion begins this fall…

#167 Vancouver_Bear on 05.17.11 at 5:09 pm

My sincere congrats to moron investors who paid $1 mil for houses in the city of Dicthmond….I bet they never saw this map, which is available to everybody on BC government website…..most of Ditchmond land is prone to severe liquefaction –
My sincere congrats, you are the greatest fools of all times!

#168 Vancouver_Bear on 05.17.11 at 5:15 pm

For Ditchmond investors who is not familiar with Soil liquefaction, please visit –… has some nice pics showing the future of your investments.

#169 Devore on 05.17.11 at 5:23 pm

#106 GregW, Oakville

Now they’re saying one, possibly 3 reactors melted down just hours after the earthquake/tsunami. They’re probably a couple hundred meters underground now, poisoning the water table and on their way through the crust. What’s on the other side of the China Syndrome?

#170 Coho on 05.17.11 at 5:40 pm

Technology does not take away jobs, rather it raises the standard of living for ALL. Technology will eventually save us from ourselves, once we understand that everyTHING is rightfully FREE. This is why knowledge is held so sacredly esoteric (hidden) by the elite because knowledge is what will break the chains of bondage that they have held on us for so long…

Disciple, I enjoy reading your posts and agree with much of what you write, but not with your view of technology. It is truth that is important. So is the intent behind things. Truth and enlightenment are of the Divine. It may appear that truth is the basis of the recent advancement of technology, but this is not necessarily the case. And I highly doubt that at the highest levels, the intentions behind the advancement of technology are for the good of the people.

I think you and I agree that very dark forces are in control of this world. We are paying a very heavy price for the convenience technology provides. There is always the dark side to technology, which ultimately shows its ugly face. Technology won’t save us. In fact the opposite is happening. It is putting this planet on a quicker path to its demise. With respect to its effects on humanity, it serves to monitor, enslave, poison, and kill us through planned and unplanned events.

Ask yourself, on an esoteric level, and considering human frailties and shortcomings, from what origin does this “technology” come? Who or what is feeding us with these insights. Having come by this technology is like a toddler happening upon a loaded gun. Would this be sponsored by good or evil? I’d guess evil. And as long as evil is in control of this planet, whose interests will technology be serving?

I don’t feel technology or even money for that matter are in themselves evil. They are, however, tools of conquest and control. Anything can be used to perpetrate wrongful acts. Snippets of truth attract people and are then twisted and mixed with untruths to misdirect, indoctrinate, and control people. Religions are a good example. The technology behind computer electronics and nuclear power can be used to create devastating weapons of mass destruction and their delivery systems. It always boils down to intent.

#171 Debtfree on 05.17.11 at 5:45 pm

Read the history part in the link and you will see why victoria and the whole of vanisle is and will always be a basket case .
If Ottawa would stop screwing B.C and live up to it’s promise we would have the biggest boom in our province that we have ever seen .
Sadly we have a B.C government with it head up harpers ass.

#172 Debtfree on 05.17.11 at 5:51 pm

Cristy if you read this blog stand up for bc . You’d be the first one in 137 years .

#173 squidly77 on 05.17.11 at 5:54 pm

Are Watermelons mimicking the coming Canadian real estate crash.

The overuse of a chemical that helps fruit grow faster was blamed in one report by China Central Television.

But agriculture experts were unable to explain why chemical-free melons were exploding. They cited the weather and abnormal size of the melon as factors.

China Central Television said farmers were overspraying their crops with the growth promoter, hoping they could get their fruit to market ahead of the peak season and increase their profits.Link

#174 Pr on 05.17.11 at 6:08 pm

Garth, can you please send, to all the Main stream media journalist of real estate, how to understand, the average sale prices and the drop in numbers of sales. They dont get it!

#175 disciple on 05.17.11 at 6:15 pm

Junius, buddy, I understand your vantage point. BUT, technology is not neutral at all. Just compare a western nation with a third world nation. It is simply technology that makes one more efficient than the other. But your definition of “efficient” is based on the belief in scarcity, the absurdity of which I will expound upon in lesson #7.

#176 Junius on 05.17.11 at 6:26 pm

#155 Thirty Something,

You noted, “First they are talking about Carney being a candidate for head of the IMF. Get in there quick Carney, before the jig is up!”

Why would he not be considered? He has the only qualification necessary. He worked at Goldman Sachs and therefore knows the secret handshake.

#177 Junius on 05.17.11 at 6:28 pm

#161 realpaul,

Need we point out to you that the banking regulations that saved the Canadian banks and the Cons butts were brought in by the Liberals. The Cons would have dismantled them if they had got a majority a decade ago.

You are a becoming a narrower and narrower polemic by the day…….assuming that is possible.

#178 poco on 05.17.11 at 6:32 pm

One of my favorite RE economist on BNN today–more spin

check out the projected sales for the remainder of 2011 and for 2012—me thinks the bars on the right side of the graph may end up equal to the bars on the left side

#179 Utopia on 05.17.11 at 6:45 pm

#165 Bruce on 05.17.11 at 5:02 pm

“Implosion begins this fall…”

Oh stop it Bruce. Market correction (yes), End of the world (No).

#180 The American on 05.17.11 at 6:45 pm

At #167: Vancouver Bear, do Brokers in Canada not have the obligatory duty and legal obligation to their clients to fully disclose the potential for extreme danger or damage/destruction in areas where liquifaction is more predominant?

#181 American Werewolf on 05.17.11 at 6:50 pm

@ Abitibidoug

I am sorry, but having the people subsidize risk for private gain has nothing to do with communism. The role the CMHC plays is much closer to corporatism–the government is actively facilitating the transfer of wealth (both private and public) to the few and elite that it serves (all under the guise of helping people).

In the end, everyone will be broke while the bankers laugh their way to the bank.

#182 ottawan on 05.17.11 at 6:52 pm

What is wrong with buyers?

How many buyers know what a fair price is, given the current market? Do you know which houses are selling and which are not? It is an expensive investment and if you simply do the following you will have a good idea.

Copy to a word document listings from mls in an area you are interested in. (this takes a bit of time, but you will be glad you did this later.) In Ottawa’s case you have to open the picture and do another copy paste. Now you have the total in that area TODAY. Write a summary at the top… something like May 17, 86 listings. Check back tomorrow and if two houses have been added add them to your list and note this in your summary. If two houses have sold, colour the word SOLD in yellow and copy this to the summary. Very quickly you know what asking prices are being sold quickly and what prices are just sitting.

In Ottawa I have been doing this for the past month. Last month it was mainly houses in the $345 and under group that sold. (Many of these homes were in less desirable areas, and I think they sold because there are few listings in desirable areas.)This month, more are selling in the $350’s, but the total is small.
Hardly anything has sold over $450,000, even in Westboro which I have been tracking.

Buyers need to empower themselves, and perhaps if they realize that prices are stabilizing, and interest rates may rise, sellers will be forced to lower their price.

#183 kilby on 05.17.11 at 6:55 pm

#110 BPOE Maui is really hurting, people can’t even find renters in the winter anymore and with water problems and diesel electricity it getting easier to cost more than Maui….

#184 Mr Buyer on 05.17.11 at 6:58 pm

Dear 45 north #127. Through the magic of planes, trains and automobiles coupled with a 1 week national holiday in Japan I was able to be in Ottawa (same Buyer).

#185 Ronaldo on 05.17.11 at 7:02 pm

Here is what the real estate bust in Moscow looks like and what can be expected to happen all over the world including China according to Mike Maloney…

#186 rocko on 05.17.11 at 7:04 pm


I presume you saw the new $8000 levy placed on all new home purchases in Cowtown today…

How do you predict this will affect the local market? More first time buyers heading out to Airdrie? Okotoks? How about purchases on ‘used’ homes?

#187 Ronaldo on 05.17.11 at 7:08 pm And here is the boom and bust of real estate in Vegas…watch

#188 jess on 05.17.11 at 7:08 pm

160 Live Under Your Means

N’ how … with all these machines /robots and lights out factories.

gm brazil
GM Brazil Puts 900 Workers on Paid Furlough

SAO PAULO – General Motors said on Thursday that it put 900 workers at two of its Brazilian plants on paid month-long furlough to “adjust production” in the face of slumping sales.

will not renew the contracts of 1,633 temporary workers at the Sao Caetano do Sul plant that start to expire in late March.

Fearing layoffs, unions representing autoworkers in Sao Paulo state, Brazil’s industrial heartland, agreed to pay cuts in exchange for employers’ promise to preserve 16,300 jobs in the auto sector”.


State-run Banco do Brasil, Latin America’s largest financial institution by assets, announced Monday a deal to purchase Florida-based EuroBank for $6 million.

Brazil’s official unemployment rate rose to 8.2 percent in January as some 340,000 workers lost their jobs, the IBGE statistics agency said last week.

The total number of people out of work reached 1.9 million, according to the IBGE’s monthly report on unemployment, which is based on figures from the country’s six major metropolitan areas: Sao Paulo, Rio de Janeiro, Belo Horizonte, Recife, Porto Alegre and Salvador.

Construction of Belo Monte on the Xingu River – within the limits of the Amazonian municipality of Altamira – began earlier this year and the dam is scheduled to come online in 2015 as the world’s third-biggest hydroelectric complex after China’s Three Gorges and Itaipu, which is jointly operated by Brazil and Paraguay.

and Vale just bought a piece of the dam.
Mercosur – Argentina, Brazil, Paraguay and Uruguay – stand out as the five economies in Latin America that grew the most last year.

#189 kilby on 05.17.11 at 7:09 pm

At a friends place in East Vancouver this afternoon, he is getting ready to list it in the next 3 weeks or so. Last weekend he was disappointed to see another 100 year old 900 sq. ft home across the street listed for “only” $699k. He thought it was worth $800K and was hoping for the same………It sold on the weekend it was listed for $795K. $96,000 over asking price….unbelievable.

#190 Peter on 05.17.11 at 7:13 pm

It is interesting that you mention Ted Zaharko I saw his for sale sign in front of this property through at least 3 seasons. This spring someone abandoned a smashed up car in front of it which stayed put for a few weeks before it was towed away.

When it was first listed I checked out the price on the internet and is was $250,000. Now the asking price is $227700. Wait a few more seasons and you probably be able to buy if for an even lower price.

Note: If you need to hide a smashed up car for a few weeks you can park right in front of this building. Nobody will notice but me and I don’t care!

You can view his ad here.

#191 tim toddler on 05.17.11 at 7:16 pm

#167 vancouver_bear
The wikipedia link is a virus. Dont click

#192 Hoof - Hearted on 05.17.11 at 7:24 pm

#160 Live Under Your Means

Good scoop.

I look at this McDonalds initiative as a sign of the world armageddon ( economic WW III ).

I am sure we recall Henry Fords mantra of who will but his cars if the wage is too low.

I thought McDonalds was a reasonably good corporate citizen…employed youth and gave them good training.

What next Mc Donald’s ….teleporting food from some central location run by robots and one human shareholder?

Or J.V. with big pharma to produce a drug that makes us think we got our fast food fix.

I recall a Steve Martin skit whereby everything at Rotten Ronnies wasmade out of the same basic ingredients Hamburger pfftttt….fries…pfffftttt …..even your change pffttttt.

Onto the small Ma and Pa restaurantes

#193 Desi on 05.17.11 at 7:47 pm

I called a friend who just bought $800K+ home. According to him, a house is the best hedge against inflation and, despite increasing inflation, govt cannot afford to raise interest rate as that would boost already above parity dollar and any further boost to dollar would ruin manufacturing and export which govt would not like to see so the prices are set to stay where they are or event can go up and he was quite happy quoting me the following link:–home-prices-climb-8-despite-drop-in-resales

Garth, what do you say???

Get a new friend. This one’s about to be pissed. — Garth

#194 Junius on 05.17.11 at 7:53 pm

#174 disciple,

You missed my point. I don’t reject technology and it is clear that it can and does improve the quality of life in many ways.

What I reject is the notion that it is always positive as you assert. It often has consequences as negative as positive.

Do I need to make a list for you of all the ways it is also hurting us from environmental to food to energy and so on. Your opinion is too narrow and lacks nuance on this complicated issue.

#195 Daisy Mae on 05.17.11 at 7:54 pm

Junius on 05.17.11 at 8:37 am#46 McLovin,

“Perhaps you missed the part that the Cons have now tightened the CMHC rules twice in the past 14 months. You also missed the part that they won their majority gov’t and now don’t given a flying Flaherty about homeowners. How naive.”

Re “tightening the CMHC rules twice”….all the CONS actually did was correct their past mistakes.

#196 S.B. on 05.17.11 at 8:03 pm

No child left behind! In debt… :(

Bloomberg) — Higher education fails to provide students “good value” for the money they and their families spend, more than half of U.S. adults said in a survey.

The debate over higher education’s value “has been triggered not just by rising costs but also by hard economic times,” according to a report released yesterday by the Washington-based Pew Research Center. The organization, an independent research group funded by Philadelphia-based Pew Charitable Trusts, surveyed 2,142 adults, aged 18 and older, from March 15 through March 29.

The survey follows a call by President Barack Obama for the U.S. to achieve the highest college graduation rate in the world by 2020. The U.S. now ranks 12th among 36 developed nations, according to a report last year by the College Board.

In the poll, 75 percent of U.S. adults said college was unaffordable for most Americans, and almost half said that student loans had made it harder to pay other bills.

At the same time, 86 percent of college graduates said that it had been a good investment for them personally. College graduates said they earned an average $20,000 a year more because of their degrees, a figure that closely matches U.S. Census Bureau data, the survey found.

#197 Nostradamus Le Mad Vlad on 05.17.11 at 8:06 pm

#103 and #105 GregW, Oakville — Hi Greg, and thanks for the lins. Situation there is still deteriorating.
3:35 clip The NOsama Song, complete with news anchors!

4:24 clip Seems to have become a raging inferno in Fukushima, and this.

7:52 clip IMF — All the wrong reasons, but at the right time.

US$58K per second is what the US borrows. Links in. The US Treasury is about to steal citizens’ pensions. Watch for the CPC to follow suit. Financial Repression “Help help! I’m being repressed!”

Coincidence? Plenty of disasters are hitting food baskets around the world.

Syria Might be in co-operation with the ‘quake next week! But Atheism is sure looking like a solid bet!

CC Wasn’t too hard for this scientist to figure this scam out.

Destroying Monsanto Not such a bad idea. What goes up must come down, and this is an excellent reason why.

Sanctions “The United States froze the assets Tuesday of an Iranian state-owned bank for its alleged help with Tehran’s suspected nuclear weapons program.” Note the word ‘alleged’. Nothing is proven, except Dimona.

#198 eddy on 05.17.11 at 8:15 pm

I would like to see the federal government get out of the business of insuring unqualified home buyers. Banks can do that.

Eric Sprott Discusses Silver’s Prospects And Last Week’s Raid With Max Keiser (Video)

#199 kilby on 05.17.11 at 8:24 pm

#185 Rocko.

Was in Calgary on the weekend and took a shuttle from town to Spruce Meadows for dinner dance. All on the bus commented on the endless sprawl of homes jammed in together for miles in little separate groups with nothing in between, the worst urban planning anybody had seen, if I was a taxpayer supporting 1/2 of these developer’s costs I would be pretty angry….And they look very uninviting, jammed in together, no trees or anything suggesting “neighborhood”

#200 Lisa on 05.17.11 at 8:47 pm

In Toronto prices are SICK! A crummy crabshack will cost you $500k. Same place a few years ago would’ve been less than half the price. Want to live in a decent ‘hood? Crummiest, smallest place will cost you at least $600k. No fundamentals there, just greed.

#201 disciple on 05.17.11 at 8:47 pm

Junius and Coho- Thank you for your responses.
Rest assured, I did not miss your point at all. Obviously technology can and is being used for nefarious purposes. But that is also my point. The technology that is being employed for this purpose is secretive, and secrets are based on the erroneous notion of profit. You see it all ties together…I would suggest the both of you are missing the bigger picture. You probably do not realize that human beings have been on this planet for hundreds of millions of years in peace and harmony, and that a recent cataclysm has resulted in the loss of much of our heritage, and the opportunity for the 5% of our psychopathic members to exert covert control by keeping this lost knowledge to themselves.

Here’s the shocker for you to get a grasp of what I am delineating by my seemingly heretical idea that technology does not take away jobs: I do not refer to technology in the narrow fields of electromagnetism and mineral sciences. Technology encompasses the scientific as well as spiritual as well as human psychology. Anything that elevates our understanding and knowledge of our universe is in fact technology. We will again come back to the wisdom that profits and ownership in the modern definitions are totally meaningless.

#202 American Werewolf on 05.17.11 at 9:37 pm

@ disciple

“You probably do not realize that human beings have been on this planet for hundreds of millions of years in peace and harmony”

Did they use to ride dinosaurs to work?

You are off your rocker.

#203 Timing is Everything on 05.17.11 at 9:40 pm

#180 The American

Buyer beware. Full stop.

#204 Abitibidoug on 05.17.11 at 10:45 pm

Response to #181 American Werewolf: Good point you make. I think what you are talking about is also called corporate welfare.

#205 disciple on 05.17.11 at 11:13 pm

Werewolf – Dinosaurs never existed, at least as they are portrayed to the naive public. You and others like you have much, much to learn. Let me be your guide. I’m non-profit :)

#206 jess on 05.18.11 at 12:28 pm

194 Junius

don’t forget to include :
algorithmic traders (computers) unwinding positions

As IRS crusades against Americans hiding money offshore, Latin American tax cheats flock to U.S. banks iwatch
May 18 –

The safe and secret side: the SSS
billions of dollars in covert accounts for Americans trying to avoid U.S. taxes. (but not just americans needs a pronoun change…

IRS event today on plan to force banks to report foreign nationals’ accounts
By Michael Hudson
10 hours, 48 minutes ago


State-run Banco do Brasil, Latin America’s largest financial institution by assets, announced Monday a deal to purchase Florida-based EuroBank for $6 million.

U.S. banks hold an estimated $3.6 trillion in foreign deposits
but the ass. says the reason is their countries leaders are corrupt and hence why they prefer american banks for “safety”

U.S. bankers began a concerted push in the 1970s to lure so-called hot money from a wide range of well-off Latin Americans seeking to avoid taxes in their home countries, according to James S. Henry, a former chief economist for McKinsey & Co. and author of books and papers on offshore money.

By the mid-1980s, Henry says, his research revealed Citibank was taking more money out of developing nations than it was lending to them, and its private banking group had become its most profitable unit.

Citibank, Henry wrote, “resorted to skullduggery and the flouting of local laws all over the planet.” It sent private bankers undercover to Argentina, Venezuela and other destinations, helping to spawn thousands of shell companies and “concealing vast sums of flight capital from Third World tax authorities” while lobbying Congress to maintain “near-Swiss secrecy” for foreign depositors, Henry claims.

A Citigroup spokesman declined to comment on its private banking unit’s history in Latin America and other regions.

Dirty money moving from Latin America to the United States isn’t a problem that has gone away. Last year, Wachovia Bank agreed to pay $160 million to settle charges that it had helped Mexican

#207 earlymidlifecrisis on 05.18.11 at 3:28 pm

Does anyone have any knowledge of what, if any, affect this has had on real estate in areas where it has been implemented?