AAA

I’ll keep this short. It’s a simple thing. I hope you remember.

This blog’s had two messages for some time. First, residential real estate is a very dangerous asset, at this time, in this country. Whenever average people can’t afford average houses, the die is cast. Were it not for cheap money, an addiction to debt and bad public policy, homes would still be affordable.

But, too late for that. There will be a correction. The two high-risk groups are new buyers with too many hormones, too little equity and unrepayable debt; and real estate-rich Boomers on the cusp of retirement, who in a year may not be able to sell. Or retire.

The second message is liquidity. There’s far less risk in financial assets than in real estate, especially in Canada. Those who think a real estate downturn will collapse the economy are confused. It won’t. It will certainly destroy the financial lives of hundreds of thousands of people, but not a single bank, credit union or major lender will fail.

The Canadian economy will withstand this easily, even when condo towers in Toronto are full of underwater couples, and Calgary’s suburban streets bristle with McMansions their sad owners cannot flog. Banks have done what borrowers have not, and are well prepared for the inevitable. Like all major corporations, they learned in the financial crash. They have less debt, more efficiencies, thinner overhead and wider markets. The economy may barely breath, but the profits of TD, Royal, Scotia and CIBC just surged an average of 43%.

So, here is what’s coming.

As Europe rots and the US staggers to its knees, AAA Canada will beckon. The dollar will continue a jagged ascent. As global demand inches higher and commodities gain, our economy will benefit disproportionately. For all their sub-prime faults and insufferable gall, our banks will continue to be viewed as granite. As America slowly recovers after the 2012 election, rising demand for natural resources will boost exports and restore jobs.

For global investors lusting for certainty and fleeing sovereign debt risk, this country will seduce. Surely you can see it. Wise people will use volatile and uncertain days like these to shed inflated houses, get liquid and debt-free, then acquire a diverse array of financial assets. I’ve devoted many posts to exactly these things – preferred shares, exchange-traded funds, corporate, government and real-return bonds, income trusts, REITs and commercial real estate. A balanced mix will serve you. Acting now will save you.

Of course, there’ll be those who think a stiffening economy will breathe the passion back into housing. Not a chance. The pendulum has swung to excess already. There’s not enough wealth left to push an average Vancouver home from a million to two, without a doubling in incomes. Household debt’s already at critical levels. An aging third of the population is thinking of selling, not buying. And interest rates are likely to swell.

It’s expected Mark Carney will be the only central banker in the industrialized world to raise rates next year, simply because all of the above will fuel inflation. Already increases in the cost of living have topped the Bank of Canada’s targets for almost a year. And while the increase may only be a quarter point initially, it’ll be enough.

So, a turning point. The era of the house ends. The age of liquidity begins.

The hell of it is, you never know the moment, until it’s gone.

190 comments ↓

#1 pathcontrolmonk on 12.05.11 at 10:30 pm

My friend just sold his $1 million house to buy a $1.5 mil house, the logic being that the money made on the last house would cover any losses should the RE market tank. Few are listening, they prefer their own logic.

Which is precisely why this will happen. — Garth

#2 phinny on 12.05.11 at 10:32 pm

Nice to here about a future that isn’t utterly bleak.

Everyone is becoming a bloody doomer these days, and its getting a bit annoying.

#3 TheRealTruth on 12.05.11 at 10:35 pm

I dont know af any aging boomers wanting to sell in Vancouver…they are all content in their ‘mansions’.

This whole notion of boomers selling en masseis overblown. What are they going to do after? rent from whom if they all sell? all while pushing rental rates up?

House-rich, asset-poor. No choice. But it will only take a small fraction selling to make a substantial difference. — Garth

#4 Tired on 12.05.11 at 10:36 pm

Hi Garth,

Wont this foreign money coming out of the eurozone also spill into real estate reducing the possibilities of price reductions?

Rich foreigners didn’t get that way buying inflated assets. — Garth

#5 Synnyrs on 12.05.11 at 10:36 pm

always first…….yeah

#6 TheRealTruth on 12.05.11 at 10:38 pm

Banks are an Oligopoly in Canada…like the Telecoms.

…and you support this and pump them like a true owner indeed!

As opposed to what…? — Garth

#7 Canadian Merchant Accounts on 12.05.11 at 10:38 pm

By far the best post yet.

This summary should make it clear for anyone thinking of buying a home in Van or TO or a variety of other markets to stop and think twice.

Well done Garth!

#8 OMG I'm so not first on 12.05.11 at 10:39 pm

Drool drool, I’m a raving lunatic who loves thinking he’s FIRST.

#9 East Van on 12.05.11 at 10:40 pm

The price of real estate is not the problem. The problem is that the wealth gap is increasing, and the middle class is disappearing. The social unrest to come will make the occupy movement look like, well, a “tea party”

#10 michael francis on 12.05.11 at 10:42 pm

Garth.

When are you coming to Australia to check out our property market. (Same as Canada-different accent.)
Its summer over here, borrowing costs have just been reduced and first timers are getting horny again.

#11 First Place on 12.05.11 at 10:52 pm

first. I need a million dollar van pad.

#12 Jak_of_TO on 12.05.11 at 10:54 pm

Hi Garth,

When is your new book coming ?

#13 grantmi on 12.05.11 at 11:02 pm

It’s obvious there is NO LIMITS to what desperate measures the governments will do to shore up the financial markets.

When you have the US FED and Government lending $7.7 TRILLION dollars to banks during the 08 -09 crisis…. for 0.01% interest rates!!!!

http://bit.ly/u6Fo6H

The game is completely rigged!!!!

“Move along.. nothing to see here!!”

#14 Bottoms_Up on 12.05.11 at 11:04 pm

#185 Mr. Buyer
“…..most of my great personal concerns have simply evaporated now that I have kids. I can hardly remember issues and experiences that held so much of my attention for so many years before I had kids. I would also like to say that I have a greater concern for the future, country, and community now simply because I want my kids to have the best chance possible…..”
———————————————————
I had to repost this for you because it definitely hit home with me, and is a good summary of how probably a lot of parents feel. Having children has also made me acutely aware of how each of us was once a child (well, given some of the recent blog comments there are some children that frequent this website), and that we should all treat others how we would want to be treated.

#15 sam.i.am on 12.05.11 at 11:07 pm

Something about tonight’s blog entry. Is this the work of the ghostwriter?

Boo. — Garth

#16 Tim on 12.05.11 at 11:09 pm

So Canadian banks are a screaming buy now

If you say so. — Garth

#17 Heart of the World on 12.05.11 at 11:10 pm

Eleventh!!!!

I am one of the boomers Garth disses with such annoying regularity. Not a wrinkle in sight on me — and no — I don’t have a flabby arse either. But that’s another story.

My real estate guru is Garth these days, but it used to be Ozzie Jurock. In the early 2000s I started buying rentals in the Penticton area, on Ozzie’s advice (in a general sense). I rode the boom up, sold some, bought some… and recently on Garth’s advice, I sold my lower mainland house for a handsome profit. Now I own a fabulous place overlooking Okanagan Lake — outright. So where will those despised boomers move when they sell out (if they can)? As I write this I am surrounded by boxes full of crap, as I am moving — in my case I will be starting 2012 in my fully owned house in Naramata.

And the moral of the story is? Analyse carefully, take the best advice you can find, and bend like the willow tree before the breeze. This way lies wisdom, little grasshoppers.

#18 grantmi on 12.05.11 at 11:12 pm

#5 Synnyrs on 12.05.11 at 10:36 pm

always first…….yeah

Always a moron!!!!… yeah!!

#19 eddy on 12.05.11 at 11:14 pm

16 year old builds tiny home to guarantee mortgage-free future

http://www.themistsofavalon.net/t3349-16-year-old-builds-tiny-home-to-guarantee-mortgage-free-future

#20 Ralph Cramdown on 12.05.11 at 11:19 pm

When prices drop and speculation and development dry up, what are all the builders, trades, RE agents, mortgage brokers etcetera going to do? If employment in the sector drops from, say, 19% through the long term average of 14-15% and settles at 12% for a while, what replaces that big hole in the economy?

#21 JSS on 12.05.11 at 11:19 pm

Garth, do you think Sun Life is in trouble? Will cut dividend?

Not the preferred. — Garth

#22 George on 12.05.11 at 11:22 pm

Mark Carney and harper are ponzi masters . How much can the Conservative Housing Mortgage Con (CHMC) continue to lend money to people with no money? Right now the ponzi has lent out over 1 Trillion of unpayable debt. what is the limit? People with no money will borrow forever until the ponzi is over. I know many who should never qualify for a mortgage get stupid amounts of money . Since they bought three years ago they got a nice heloc which they borrow to pay the mortgage. Yes he is paying debt with debt and will play that game until he goes bust or sells to a greaterfool.

#23 Theresa on 12.05.11 at 11:26 pm

I’m one of the boomers who after owning in Vancouver for more than 25 years sold this spring to pay off my remaining mortgage, become debt free and invest in something other than real estate. I may buy again sometime in the future, but it will be after the dust settles and it will be smaller and mortgage free.

#24 shanks on 12.05.11 at 11:28 pm

nice ray of sunshine Garth… long live Garth, King of the Doomers!

#25 Mister Obvious on 12.05.11 at 11:30 pm

#1 pathcontrolmonk

“My friend just sold his $1 million house to buy a $1.5 mil house, the logic being that the money made on the last house would cover any losses should the RE market tank.”
—————————-

Anyone who’s brain can contain that kind of ‘logic’ should not be allowed anywhere near the housing market. They are a danger to themselves and others.

#26 vyw on 12.05.11 at 11:41 pm

Van prices up in Nov over October:
http://www.rebgv.org/housing-price-index?region=all&type=all&date=2011-11-01

Exactly my point. — Garth

#27 Mr. Lahey on 12.05.11 at 11:41 pm

I just realized that some of our Australian blog dogs have been left out in the invitation list to the first annual Sunnyvale Trailer Park Greater Fool Blog Dog Xmas party. I know it is quite the trek from Australia to Nova Scotia but you are all welcome to share in this momentous festivity. The bearded has informed me that he is going to tear Flaherty to pieces for creating this massive housing bubble in Canada and the now unfolding meltdown. Sir Garth will also be signing copies of his books and will have plenty on hand for sale. “Barb get that granite countered trailer all spiffed up for Turner”.

#28 Mark on 12.05.11 at 11:41 pm

Foreign investment into Canada fuelling inflation? Hardly. Foreign investment implies that foreigners are sending more to Canada, than Canada receives from the foreigners. This would indicate deflation and lower interest rates, as the BoC needs to expand the money supply in order to soak up the inflows.

I’m a big housing bear, but, IMHO, not a chance that interest rates are going up in the next few years in Canada. May even go down.

Not a chance. — Garth

#29 Mark on 12.05.11 at 11:50 pm

Not a chance. — Garth

Where does the inflation come from (a prerequisite to higher rates) when foreigners are willing to hand over goods and services in exchange for claims on ‘investment’ in Canada?

Usually when a bunch of foreign goods and services wash ashore, prices of domestic goods go down. Does this really support higher interest rates?

#30 Canadian Watchdog on 12.05.11 at 11:58 pm

Only a matter of time before the bond vigilantes and hedge fund hyenas sense Canadian blood spilled. Canadian Sovereign CDS is on sale for the holidays.

#31 Mr. Lahey on 12.06.11 at 12:00 am

#190 Johny Bravo

“Mr. Lahey, I will even bring my own whistle”.

Very kind of you Johny and I know you will make an excellent judge in the ploughing match between Form Man and Westernman. Everyone in the trailer park is really taken aback by the xmas spirit all the blog dogs are exhibiting. To think Form Man and Westernman have set aside differences to engage in a peaceful ploughing match! You guys will love Ricky, Randy, Julian, Bubbles and the rest of the Sunnyvale misfits.

#32 InvestorsFriend (Shawn Allen) on 12.06.11 at 12:01 am

Tired at 4 askes:

Wont this foreign money coming out of the eurozone also spill into real estate reducing the possibilities of price reductions?
+++++++++++++++++++++

Okay what money coming out of Europe? If you mean European bank deposits okay that might be true. But Canadians have very little money in European bank deposits, I am sure. And is they ahve some in Swiss banks, well tath is stills agfe and not likely to come back home. And even if it did it is not going to be used to buy a house. People with Swiss banl accounts alreay own a house or two.

If you mean dollars invested in European bonds coming out that will not and cannot happen.

In order for one investor to sell a European bond and cash out another has to buy it. So no net money will flow out of European bonds.

More likly some European bonds will default and some money will simply dissappear.

I don’t think there is any indication that net dollars will flow from Europe to Canada.

#33 45north on 12.06.11 at 12:01 am

rising demand for natural resources will boost exports and restore jobs.

I just came back from a field trip to Kirkland Lake (ON). The hotels are full – no discounts. They are re-opening the gold mines and hiring miners. Real estate is doing very well but no condos. On the other hand the project to extend the divided Highway 11 from Toronto to North Bay is almost complete. The men who worked on the highway are almost gone too.

#34 Nemesis on 12.06.11 at 12:05 am

“As America slowly recovers after the 2012 election, rising demand for natural resources will boost exports and restore jobs.” – Hon. GT

Perhaps… But just in case, have you considered publishing an illustrated survivalists’ guide to rodent BBQ? (wine pairings would be helpful, too)

#35 OwlEyes on 12.06.11 at 12:07 am

“even when condo towers in Toronto are full of underwater couples”
… LITERALLY!

#36 Jane on 12.06.11 at 12:15 am

#3 TheRealTruth on 12.05.11 at 10:35 pm

My parents and my in laws are wanting to sell. There’s two in Van for you.

#37 Makaya on 12.06.11 at 12:15 am

Financial Armageddon anyone?

You have probably heard that already on the news today, but 15 EU countries are about to be downgraded by S&P (http://tinyurl.com/7vqtynr). Even Germany, which until very recently was considered as the safest/most stable country will be impacted. This is surprising because, until a few days ago, only France and Austria seemed to be on the target list of S&P.

This news is significant because it means that the borrowing costs of the EU countries will likely increase following the downgrade, which they can’t really afford. This has the potential to create of a nasty domino effect in Europe. There is now no way Germany, France and a few others will (be able to) bailout Greece, Portugal, Spain, Ireland and Italy. Expect, in the weeks to come, a cascade of public (Greece for sure, a few others certainly) and private (over-leveraged banks in France, Germany, Italy and Spain) defaults coming from Europe that will have a much worse effect on the global economy than the bankruptcy of Lehman.

This little apocalyptic analysis brings me to Jean-Pierre Mustier… Who is this guy? Well, he was the former “boss” of Jerome Kerviel, the rogue trade that managed to lose €4.9 billion, while working for Societe Generale (the french bank that has been on the verge of bankruptcy for a few weeks and is still on life support). He is now the head of the investment banking branch of Unicredit, one of the major Italian banks. He is somebody that surely knows “quite a bit” of the financial markets. And here is what he genuinely said in a talk about bankers and traders bonuses recently (translated from french):

“We should talk about what really matters. It’s fine to talk about bonuses, but you may not realize that in a couple of days or a week, our world could disappear. It’s Armageddon”

“We are on the verge of a great social revolution”

“Banks had ROIs that were too high. It was unsustainable, otherwise, only banks and lawyers would have survived and the rest of the economic actors would have died.”

“It’s either 1789 [the french revolution, when the King Louis XVI got his head cut off], or a major change in our industry.”

“During crisis time, we’re no longer European, it’s every man for himself.”

For those of you who remember a bit of french from school, here is the original article: http://tinyurl.com/6vnlbe6

To paraphrase Kyle Bass, don’t trust our government and don’t trust the news. Get ready ready, the worse is yet to come.

Canada is not immune to what’s happening in Europe and expect tough times ahead for us in general and, especially, for Vancouver RE. Their won’t be enough HAM or interest rate reduction to “save” our butts this time.

S&P downgrade, if it happens, is meaningless. — Garth

#38 mike 72 on 12.06.11 at 12:18 am

I hope they announce a rate hike, this will spook people into buying now. I plan on listing my house in the new year and getting liquid. Vic is slow right now, we need a good spooking.

#39 Nostradamus Le Mad Vlad on 12.06.11 at 12:29 am


“There’s far less risk in financial assets than in real estate. AAA Canada will beckon. The Canadian economy will withstand this, but the profits of TD, Royal, Scotia and CIBC just surged an average of 43% . . . this country will seduce.” — It would be nice if the Okanagan were seducier — to unexpectedly sell and put the net proceeds into a nice, balanced fund returning about 8% a year for the forseeable future would be very creamy!
*
“It’s expected Mark Carney . . .” — This Mark Carney? Congrats. Mark, you’ve made the big time! SAFTA NAmerica not invited to join; Green Energy So much for going green — another fad by TPTB; Irish Austerity Brutal; Spinning “The latest scheme is for countries to trade sovereignty over their budgets in return for more bailout money…” (NWO); HSBC fined What about burning them at the stake? Another Bubble? Keep ’em coming!

Real Unemployment in US far higher than 8.6%, and Future Jobs; As Garth constantly reiterates, Retirements Looms; Europe imitating Japan, Ambrose Evans-Pritchard called to task, Unwinding.
*
Question Of The Day Primarily for science buffs, a hypothetical proposition only, and Electric Sun; It takes all sorts Man does a 360 while water skiing on a table; Children Sexual abuse not a privilege of the clergy; War on Terror Psychological psychobabble hoax; Global Political Reformation Good idea, not sure if it will fly. TPTB are always one step ahead of us; France and GMO’s France is right on this; Diet Coke Gaining weight? GW in UK Faces a rush of steaming, hot weather.

Nome, Alaska GW caused this; Guantanamo for US citizens under Bill S 1879? One ‘cano blows, might waken Toba, and possible Icelandic one ready to blow; Big Pharma The 1% want our vitamins.

#40 lcoacare on 12.06.11 at 12:31 am

Hi Garth
I think you should stick to real estate analysis. Globally, China is already overheating thanks to their own credit bubble. They will take commodities and Canada down with it. The greenback will soar, and deflation will win everywhere but Zimbabwe.

Real estate values just declined in 33 Chinese cities. Some overheating. — Garth

#41 Jon B on 12.06.11 at 12:36 am

I’d buy warm climate US real estate at this point in time in favour of “financial assets” like ETFs and individual stocks.

#42 LJ on 12.06.11 at 12:49 am

Did any of you really read the article?

This was Garth at his most coherent. Read it again – very carefully.

#43 Junius on 12.06.11 at 12:56 am

I hope you are right Garth. I am less optimistic on a recovery. In particular the amount of debt we hold as a society coupled with an economy that is more than 60% driven by consumption. In any event, it was good to hear some optimism.

#44 Luke on 12.06.11 at 12:57 am

Garth, what makes you think Canadian exports are going to thrive in an environment where the U.S. economy is in the tank, and the FED resorts to more QE (Money Printing) and the $CAD spikes to $1.25+ USD?

Natural Resources only account for 11% of our GDP, and 4% of our employment, yet 75% of our exports go to the U.S.

#45 Ammo & Viagra on 12.06.11 at 1:07 am

“nice ray of sunshine Garth… long live Garth, King of the Doomers!”

no no, Garth has been too positive lately. we need a shake up posting..bring on the doom Gman..love those ones the bestest.(the last few postings have been about idiots burying themselves in too much debt..sucks to be them)

#46 not 1st on 12.06.11 at 1:13 am

Cmon Garth, not more than 2 months ago you were signaling the death toll for commodities, now you are calling for renewed strength in them. Why don’t you just admit you called that one wrong. Want me to dig up your old posts?

Sure. Show me the ‘death toll.’ — Garth

#47 EJ on 12.06.11 at 1:15 am

I gots a predilection for prediction!

Rampant deficit spending will continue, AAA will be at risk as a result, just like in every other country that spends more than they take in.

China’s massive bubble is bursting and will collapse commodity demands. This will hit commodity based countries like Canada and Australia.

Carney will not raise rates willingly as low rates are always the Central Banker’s “fix” for a shitty economy, yet it never works because they never address the real problems, which are government-sanctioned, fraud-induced bubbles. Extend and pretend will continue. Rates will spike up dramatically and to the shock of everyone in debt when markets eventually force Carney’s hand. Of course this will happen at the worst possible time and Carney will claim there was nothing he could do about it. It will be everyone’s fault except Canada’s.

CDN banks will get caught with their pants down when European countries eventually default, triggering CDS losses that “nobody could have seen coming” and will require gov’t intervention at taxpayer expense. Naturally, they will attempt to keep this a secret and when people find out about it, they’ll tout it as a “preventative measure”, or some other term that disguises the bailout. Banks will also take losses on the overly rapid expansion via purchases of other country’s banks, a-la Dexia.

Canadian stability is a myth. We’re just better at lying about our situation. Trust the government to do nearly everything wrong for the common person. Governing at random would yield more favourable results.

Interesting times, indeed!

#48 earlymidlifecrisis on 12.06.11 at 1:15 am

@27- With all the spicy comments lately an xmas party like that would be very interesting lol. I’d go.

#49 GregW, Oakville on 12.06.11 at 1:16 am

Hi #173 Nostra, re: Your “Bomb them!” comment.
I don’t believe just cutting taxes automatically leads to being Bombed. But not trading oil in USA dollars will get you a free pass to being put on that axis of evil list for sure! (And then you know what has/may happen…)

I still think this guys entertaining explanation/take of history is interesting to here. It’s about 45min.
“Robert Newmans History of Oil.”
(got a few hits on search engine, here is one.)
http://www.moviesfoundonline.com/robert_newmans_history_of_oil.php

#50 [email protected] on 12.06.11 at 1:21 am

What does the US and Europe in recession do besides pull China into a downward trend because of weak consumers? Wouldn’t this mean Canadian resources and therefore the current economy starts sliding? I have REITs, preferred shares and index ETFs (XIU/XEI) but am I wrong in waiting for an inevitable drop to buy more since there’s going to widespread bloodshed due to the EU finally owning up and global instability causing another credit freeze in the next month?

#51 tmg on 12.06.11 at 1:22 am

I heard on the radio today that Carney may lower interest rates next year. Will that push a correction back?

Get a new radio. — Garth

#52 Mr Inconsistent on 12.06.11 at 1:24 am

Funny thing about Garth. He’s not a real estate agent, so he feels free to tell the truth about the housing market, because his book’s not on the line. But he is a financial advisor, with an apparently big investment in (and possibly trailer fees from) preferred shares and “income funds” of one sort or another. And therein lies the conflict.

I don’t think it takes an extra-ordinary leap of logic to connect the dots between declining home prices and job losses (for real estate agents, mortgage brokers, bankers, tradespeople, service industries, etc). And it doesn’t take a huge subsequent jump in thinking to presume that these large scale employment dislocations will create very significant bankruptcies and credit losses.

Now that the genie is out of the bottle with respect to sovereign credit risk, one wonders whether the supposed AAA rated Canada (whose AAA rating is rather circuitously tied to the strong economy that the housing bubble has brought) will have the financial flexibility to bail out Garth’s mid-tier pieces of the bank capital structure which in a truly free market would be worth zero. To be fair, if I were a sell-side analyst, I would rate Turner’s investment ideas as “Sector Outperform,” but I suspect people who does as he does will still lose money.

Look at the 2008 playbook instead. Stay liquid. Buy undervalued real assets on a market correction and protect against an inevitable inflation.

You have no idea. I do not trade my own assets. I do not collect commissions or trailer fees of any kind from any securities. I present this blog without compensation. There is no conflict. If you had an argument you’d use it, rather than seeking to discredit an opposing view. — Garth

#53 Jody on 12.06.11 at 1:37 am

“As America slowly recovers after the 2012 election, rising demand for natural resources will boost exports and restore jobs.”

Don’t forget to click your heels three times and wish it so.

No, when the US has broken apart into a dozen bits and has been balkanized like the former Yugoslavia they won’t be buying squat from us. And when the 30% in Canada who don’t own a home are told they will be bailing out the other 70% along with the scum bag bankers then look for a revolution in this country as well. Remember, less than 20% of the population fought in the US war for independence, it doesn’t take a lot to make a huge difference.

People who actually contribute to society and work their butts off are sick and tired of being robbed, eventually they will stop paying and stop participating in the current game we have going. What’s the government going to do when people stop using their fiat currency, when people stop paying taxes to the utterly corrupt system? They going to put them all in jail? Well, that’s when the violence begins, let’s hope it never gets to that stage.

The US will not Balkanize. — Garth

#54 Harry in Saskatoon, no bust here, maybe next year, or the year after on 12.06.11 at 1:38 am

“rising demand for natural resources will boost exports and restore jobs.”

…and no bust here.

#55 jonny on 12.06.11 at 1:43 am

my wife and I don’t know how or where to buy preferred. Garth can u tell me?

#56 Upside Down on 12.06.11 at 1:44 am

#14 Bottoms_Up
Having children has also made me acutely aware of how each of us was once a child…
————–
Talking about children, we are leaving them a steaming pile of debt to have fun with for a couple of generations, so no doubt they’ll remember us for our generosity.

#57 The thing in the basement on 12.06.11 at 1:44 am

28 Mark – good point, but I think Mark C is itchin’ to pull
the trigger on rates. Even if it’s just to send a signal to
show he can. He has warned us for months these rates will not last.

Interesting feedback the low rates can give. Though they
are supposed to lessen the effect of debt and encourage investment in capital etc., they also lower the return for holders of that same debt, or require increasing the
amount allocated to saving, both resulting in decreased
income. Thirdly, they send a message that all is not well, lessening confidence even more.

#58 Phil & T on 12.06.11 at 1:50 am

Nothing wrong with being a doomer! Global Nuclear war in March, followed by the End of the World in December next!

Of course, the “Prophets of Doom” might not be quite right!

(which is why we’re sticking to our longterm investment strategies – WELL away from Bricks and Mortar!!)

#59 Van guy smokin now on 12.06.11 at 1:51 am

Garth,

Didn’t you say not too long ago that commodities will be cheaper? Especially oil and gold? And mass unemployment as well? How can our economy weather that kind of problem?

Of course commodities will fluctuate, but prices also rise with economic demand. That will happen with recovery. And, no, I did not forecast ‘mass unemployment.’ — Garth

#60 frank on 12.06.11 at 2:07 am

Weststone properties is running ads here in the lower mainland saying newbs can have a year off of paying a mortgage and everyone else can have a new car if they buy one of their units in Langley.

#61 BPOE on 12.06.11 at 2:17 am

Don’t post the FACTS. The American and Junius hate being proved wrong AGAIN!!!!!!!
&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&
vyw on 12.05.11 at 11:41 pm
Van prices up in Nov over October:
http://www.rebgv.org/housing-price-index?region=all&type=all&date=2011-11-01

Exactly my point. — Garth
.

#62 BPOE on 12.06.11 at 2:18 am

MARK THESE WORDS
____________________________
I’m a big housing bear, but, IMHO, not a chance that interest rates are going up in the next few years in Canada. May even go down.

Not a chance. — Garth

#63 Cristian on 12.06.11 at 2:27 am

“The Canadian economy will withstand this easily,…”

Sounds as if the Canadian economy is composed solely of banks.
I cannot really see how a country of indebted people can afford to consume. And since consumers represent 60-70% of the economy, if the consumers are gone, where is the economy?
The rest of the post is just the superficial “analysis” of the future seen through a crystal globe, without any fundament, without anything to support the rosy view of it. The post, like several others in the past, is a covert peddling of “liquid assets”. Which, in the end, is not less immoral than the peddling of real-estate that real-estate agents do.
I, for one, would be very curious to know what is so special about the 2012 elections that would miraculously boost the US economy, that all their luminaries have not thought of so far? Wasn’t the third year of the presidency supposed to be a great thing for stocks?… If your beloved America, Garth, was so great, why wait until ’12? Why not now? Why wait?
I could go on, but I need to vomit.

#64 Ziggy on 12.06.11 at 2:28 am

There are rumors that Canadian banks are allowing borrowers to borrow more relative to household income than their American counterparts. Just curious if there’s any truth to the rumors and what the real numbers are.

Happy to rent in Vancouver’s crazy housing market.

#65 Pr on 12.06.11 at 3:30 am

Its very amazing what a government can do to its citizen, with the help of a central bank. A house is a place to live and sleep not a part of a casino game!

#66 Dorothy on 12.06.11 at 3:49 am

I am a boomer, as are most of my friends, and I can’t honestly say I’ve seen any evidence that any of them are planning on selling their house any time soon. They worked hard and saved for many years to buy their “dream home” and now they’ve finally got it, they don’t seem inclined to give it up.
While it’s true that many haven’t saved as much as they ought to have done for their upcoming retirement, I still don’t see any sign that they’re planning on selling their houses to get some extra cash. Most of the people I know are planning on working as long as they are able to, and then living very frugally once they finally retire.
Boomers have never accepted aging gracefully, and consequently have never really envisioned living a completely different lifestyle once they turn 65. I think many of them planned to continue working for as long as possible even BEFORE the financial crisis hit. So having to work longer in order to keep paying the bills, isn’t really seen as much of a hardship by many. And if ill health forces them to retire before they’re really ready to, they won’t mind not having the money to pay for fancy holidays, or a luxurious lifestyle, because once you lose your health you lose your desire for such activities.
Even if they lose their jobs due to layoff, and are unable to find another, I still don’t see many of them selling their homes if it means taking a huge financial hit. I think they’re much more likely to stay put and take in lodgers if necessary. Because for many, their house is more than just bricks and mortar, or a financial investment. It represents all the blood, sweat and tears of their entire working lifetime. It’s what they worked so hard for so many years to obtain, and they won’t give it up easily. Unlike their parents, they don’t WANT to sell their large homes and move into retirement communities, because doing so requires admitting they’ve grown old, and boomers will never do that until they’re forced to. So while I agree with Garth that the housing boom is over, partly because Boomers are no longer buying, I don’t agree that Boomers downsizing is going to exacerbate the problem. Because the majority of them are not GOING to downsize.

#67 Betty Danin on 12.06.11 at 4:12 am

Interest rates and government bond yields will not rise because the sure demand for safe investments will outpace the supply.Economist David Rosenberg sees interest rates and bond yields staying low for many years. I am tired of the illusion given by so called experts like you Garth that interest rates will rise for over a long term period. The reason interest rates will not rise is because governments and corporations do not want people with a decent amount of assets say $300,000+ to retire. It is called financial repression. If I listened to you so called experts I would not have government bonds yielding 9.37% to 4.78% over the last 17 years. Even just recently March of 2009, 2010 I bought 5.11% to 4.78% provincial bonds maturing in 2037. The same bonds are now yielding 3.69% in the over the counter secondary market . This is a decline of about 23% to 28% in interest income per year. Almost every week all these bond yields keep falling with no stop insight. I can see now why you like Benny Tal. You guys never fooled me over the years.

It’s a plot. Pass it on. — Garth

#68 martin on 12.06.11 at 4:35 am

finally the old garth days are back, and getting some financial advice about the global markets.

hei garth when are you gonna have a live confrence? i will be more then happy to finance a part of it!!

thanks

#69 big T on 12.06.11 at 4:36 am

hart of the world, gets it, there is, and always was a
time to be on the bus, and a time to jump off, wisdom, or dumb luck will effect the result..

#70 Onemorething on 12.06.11 at 6:18 am

Aint that the truth that hurts Mr. Turner! Bang On!

We are now entering the last phase of triple top triple bottom!

Tops
1999 NASDAQ peak
2007 RE – Commodities – Foreign Currencies
2012 Gold – VLA – DJT Junk Bonds

Bottoms
2002-2003
2009
2013 then flat for 10 years?

Time to pay the Piper!

#71 wtf????? on 12.06.11 at 6:20 am

Perhaps the tax hikes won’t be as severe now that Canada has rejected the biggest farce in history. The 600 billion we were supposed to send the dictators of the trhird world is on hold….whew!!!!!!! dodged a Liberal stake to the heart there.

http://news.nationalpost.com/2011/12/05/canada-wont-renew-kyoto-commitment-kent-confirms/

#72 Longterm on 12.06.11 at 6:35 am

Garth

I read Money Road and as per your advice want to add some bonds to my equity heavy portfolio. Is there any reason not to use bond ETFs as opposed to buying the bonds directly? ETFs seem to offer high liquidity, lots of corporate and government choice and the ability to buy serveral smaller tranches easily via a discount broker. The downside as I think I see it is that as bond ETFs are comprised of a large holding of individual bonds there is no single final maturity date, rather a host of rolling dates. I assume this adds some risk of capital loss as you can’t really hold to maturity to ensure you get your initial capital back? What do you reckon? Any advice or pointing to further reading on bond ETFs versus bonds would be appreciated.

Cheers

#73 Beach Girl on 12.06.11 at 7:06 am

#181 The Patient

Thank you for the compliment.
___

Regarding home ownership, and the awful task of raking leaves. Do what I do. Wait till everyone has gone to work. Pull out your electric leaf blower and scatter those suckers anywhere but your lawn. I will not invest in brown paper bags. I think employed people should do that. On their brief reprieve of Saturday and Sunday.

Miss Daisy and I just sit on the porch. My lawn is immaculate.

Neighbours say, she does manage to keep that property up.

#74 Waterloo Resident on 12.06.11 at 7:09 am

Sorry Garth, you are 100% wrong. The boomers will not be wanting to sell their mansion, they are perfectly happy to live in them and be comfortable in them. It is only when they have a stroke or heart attack will they want to sell because they are either dead or living in a nursing home. It will only be then when the boomers will want to sell.

Boomers today are doing the “STEVE JOBS” thing, they are working until they die of old age or disease, they don’t let up until their bodies literally ‘fail’.

Sad but true.

Sad but untrue. Do some research and you will see how little resources Boomers have. Selling will be the solution of choice. BTW, Jobs was only 56. — Garth

#75 Aussie Roy on 12.06.11 at 7:33 am

Aussie Update

Yep, pretty much the same for Australia but of course with a twist. Our banks are in a slightly different position than yours, but whatever happens, I’m sure fed govt will step in to help, like during the GFC. No govt backed mortgages here just the banks and their private (mainly Aussie) mortgage insurers. Two of the “Four Pillar Banks” have more than 50% of their assets as house mortgages, the others are not far behind.

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

The Aussie experience with a Central banker who is quick to respond to inflation with higher rates has been 12 months of falling debt demand thus falling house prices. A squeezing of disposable incomes, mainly because mortgages here are so high compared to income that a small change in the interest rate is a large slice of income. (90% of all Aussie mortgages are variable).

Whether the now lowering of rates (today the RBA cut again, that’s .5% in 2 months) will spur further house debt demand reinflating house prices, only time will tell. You never can tell how many “greaterfools” there might be left. Regardless the writting is on the wall for Aussie house prices over the next ten or so years, I think the long term trend (down) is now set but there will be somes ups as well.

I suspect long term the AUD/CAD cross will return somewhere near its long term average (80s) from its current record highs (100s) as the Canadian banking system fairs better than the Aussie one in a housing downturn.

The Reserve Bank has delivered an early Christmas gift to borrowers and retailers by cutting its key interest rate for the second month in a row.

http://www.theage.com.au/business/rbas-christmas-rate-cut-20111206-1ogih.html#ixzz1fkicDtBk

PROPERTY pundits are split on whether an interest rate cut this week could provide a late season boost to the softest property market in years.

Based on initial reporting for this weekend’s 656 auctions by the Real Estate Institute of Victoria, the clearance rate reached 55 per cent, a level it has hovered around all spring.

http://www.businessday.com.au/business/property/mixed-signals-in-property-market-20111204-1odcv.html

Australian unemployment rate unchanged at 8.6% 1.04 Million unemployed (highest since 2002) & underemployment also up.

http://www.roymorgan.com/news/polls/2011/4727/

#76 pbrasseur on 12.06.11 at 8:27 am

“AAA Canada will beckon” – Garth

Maybe maybe not. It all depends how long agencies and investors remains stupid enough not to see the reality behind Canadian smoke and mirrors. Here in Québec infrastructures are crumbling and jobs are disappearing fast. Ontario’s a debt monster doing its best to imitate Québec…

AAA? Maybe if Ontario and Québec don’t hint at bankruptcy. If Montreal, the second largest city in the country don’t need a bailout by the federal government (with current rate it pays 17% of its budget to service its debt and pensions costs are growing almost exponentially).

It may take time but in the and the market always gets it right, too bad for Canada’s AAA and parity Dollar.

#77 Kaganovich on 12.06.11 at 8:46 am

Garth wrote “As Europe rots and the US staggers to its knees, AAA Canada will beckon. The dollar will continue a jagged ascent. As global demand inches higher and commodities gain, our economy will benefit disproportionately.”

While I agree that the US dollar (and equivalents) will probably stay strong as a safe haven currency, I just can’t figure out how global demand will inch higher. As far as I can tell, most of the world’s consumers are are over indebted and destined to experience demand destruction. Those countries that have export based economies can’t really decouple, at least they can’t decouple very quickly. Do we really believe that China and India are going to shift from an economy with 30 to 40 percent consumption to one with 60 to 70 percent in the next year? What about their drawing card which is cheap labour. Will Asia continue to increase its demand for oil when their growth rates are projected to fall significantly in the short term? I think China is heading towards its own reckoning in the form of a popped housing bubble that was blown in order to mitigate the effects of a faltering credit based model of consumption in EZ and USA. It was a hail mary pass that bought them time…that was it.

#78 enjc on 12.06.11 at 8:54 am

I’ve got $5000, I’m thinking about RioCan or Sobeys corporate bond. Sensible or is there a better option I haven’t considered?

#79 pbrasseur on 12.06.11 at 8:56 am

@Waterloo Resident #75

20% of canadian workers are in the public sector and retire on (falling) average at 59.

#80 Daystar on 12.06.11 at 8:58 am

The moment Canada’s credit rating sinks (think folks, combine fed, provincial and municipal debt and add this new public debt to GDP ratio and what have you got), guess what, its not AAA.

People need to know that interest rates aren’t going to stay at the bottom forever. Ireland, Portugal, Spain, Italy, Greece… their bonds were once cheap not so long ago. These days, with a spend free undertaxing federal government and a housing bubble just pricked, its tough times ahead for Canada.

Its all… when one thinks reasonably, just a shout away.

http://www.youtube.com/watch?v=rCrbziy20aU

#81 Mr. Lahey on 12.06.11 at 9:07 am

#69 Martin

“hey garth when are you gonna have a live confrence? i will be more then happy to finance a part of it!!”

Martin oh Martin. Have you not been reading my posts on the first annual Sunnyvale Trailer Park Greater Fool Blog Dog Xmas party? The bearded one, former right honourable Garth Turner is going to be addressing all the blog dogs who show up as well as wrangline with Flaherty on how super low interest rates caused the past decade long boom in Canadian real estate and why we are now on the cusp of a market meltdown. Sunnyvale Trailer Park Martin. We will see you there!

#82 Victor on 12.06.11 at 9:09 am

More sunshine from ReMax for 2012!

http://ca.finance.yahoo.com/news/canadian-home-prices-sales-volumes-115106075.html

#83 Mr. Lee on 12.06.11 at 9:12 am

Great Blog, very accurate as to what may come. One should note that job growth will still be sluggish and as the various levels of government in Canada introduce their form of muted austerity, housing will viewed as not so favorable.

#84 Mr. Lahey on 12.06.11 at 9:14 am

Garth has just told me in an urgent email to tell all the doomer bloggers on this site that the friggin world is not coming to an end. Garth even set me straight on my shithawks and told me they are not going to blanket us and send us back to the stone ages. He is concerned that the doomer sentiment is reaching epic proportions and has announced that his speech to the blog dogs at the first annual Sunnyvale Trailer Park Greater Fool Blog Dog Xmas Party will be, “Why the shithawks aren’t coming and how to thrive in these uncertain times.” He will also be autographing his books past and present and as a real kicker to the whole festive event, the sagacious one will be taking pictures with all blog dogs and the misfit inhabitants of Sunnyvale Trailer Park. Imagine a picture of yourself with Sir Garth and Ricky, or Mr. Turner and Bubbles! Responses are still being accepted.

#85 TurnerNation on 12.06.11 at 9:19 am

Blog dog Carney is making an announcement today at 9am est?

No rate change today. — Garth

#86 Mr. Lahey on 12.06.11 at 9:28 am

Form Man. If you didn’t catch Westernman’s response yesterday I shall bring you up to speed. Westernman has declined the Clydesdale ploughing contest but has enthusiastically embraced the tractor contest (his assertion quite correctly that we are in 2011). So Sunnyvale is sending a rig out to pick up Westernman’s tractor (he is flying out however). Sunnyvale has obtained a John Deere tractor for you Form Man and has hired a local farmer to teach you how to plough a straight furrow to even the playing field as Westernman has years of experience in ploughing. I take it you are still on with the switch back to tractors. Ricky was halfway to bringing the Clydesdales back to the farm when Bubbles hit on the brilliant idea of having the horses haul the blog dogs on a Xmas carol sleigh ride through the Nova Scotian forest! The bearded one (to repeat, Garth not Santa) has agreed to join the sleigh ride and engage in chats with the blog dogs whilst sleighing through the country side. Get your reservations made blog dogs (Aussies as well) and get yourselves out to Sunnyvale!

#87 johnny5z on 12.06.11 at 9:32 am

The trend is your friend until the end of the trend.

#88 Mr. Lahey on 12.06.11 at 9:48 am

Good morning Disciple. A number of the blog dogs want to know the title of your address to them at the first annual Sunnyvale Trailer Park Greater Fool Blog Dog Party. Could you at least give us some kind of hint as to what topic you will be addressing? Ricky and Cyrus are almost fighting over what your topic is going to be. I have to settle the misfits down with an answer. Much appreciated.

#89 SLN on 12.06.11 at 9:56 am

I don’s see any logical reason that the bond vigilantes won’t do their thing in Canada.
We’re under the world radar (at least as far as the MSM goes) for a reason, IMO.
These crises always come ‘out of the blue’ let’s not forget.

Because our sovereign debt is contained. — Garth

#90 Beach Girl on 12.06.11 at 10:12 am

The phone lines are heating up. Xmas in the air.

Apparently the two exs (13 years each) and the two idiots have combined forces. Have all agreed to get along. One even sprang for the turkey.

I said, they are 88 cents a pound a Wal-Mart. Don’t push the boat out.

Anyway, this is not happening, I told them I was volunteering for less delusional people.

I will be happier, with nicer people and Daisy and I will get leftovers.

#91 Guan-Di on 12.06.11 at 10:22 am

#66 Dorothy.

That’s just SO sad! I mean having to work and live frugally past 65 just to hold on to a house? I am certain a dream house you get to collapse and fall asleep in after a long day’s work every day at 70 is much better than cruising around the world for a year at 60 knowing you never have to go back to work again… I just can’t seem to figure out why… can you explain please? Because if you can show me some good reasons I might rethink my whole semi-retired at 55 fully retired at 60 plans…

#92 Ammo & Viagra on 12.06.11 at 10:23 am

#85 Mr.Lahey
No contest..Form Man’s Deere will totally destroy Westerman’s wimpy little ’65 Massey Ferguson..those pieces of crap died years ago !

#93 Mr. Lahey on 12.06.11 at 10:34 am

#93 Ammo and Viagara

Now to be fair Ammo, Westernman has not indicated he will be using a wimpy 65 Massey Ferguson. Westernman will have to indicate to all of us what type of tractor he will be using and how many furrows his plough will have. We cannot jump to conclusions. In any case Ricky is enroute to Westernman’s farm as I
type to pick up the tractor and plough.

#94 disciple on 12.06.11 at 10:57 am

#14 Bottoms up… did you just say that what it took for you to learn the golden rule, was to father children? Buddy, I remember that poster on the wall in my kindergarten class. Well, I guess, better late than NEVER.

#20… Ralph..”what replaces that big hole in the economy?” Answer: a giant timbit at minimum wage.

#33 45north… I am contemplating another trip up north to do some prospecting for gold and quartz, diamonds, and other precious rocks… it’s a lot of fun… I highly recommend it. Kenora has that old haunted mine… I suspect there is an enormous bounty yet to be discovered by our children and grandchildren. Mama earth never fails to provide. Just call her up sometimes, people! Just to say hello, you know?

#66 Dorothy… have you heard of that analogy with the live frog in the water on the stovetop? The wave of momentous change occurs slowly, but the tide strikes the shore with instant ferocity, you won’t see it coming if your eyes are closed.

#86 Mornin’ Mr. L… here’s my hint: I have no freakin’ clue, but here is a great link to expand one’s mind’s eye:
http://apod.nasa.gov/apod/archivepix.html

#95 Ammo & Viagra on 12.06.11 at 11:06 am

OK blog dogs
do you prefer a Garth presenting a more dark dire message,
a Garth presenting a balanced middle of the road safe approach,
or the rose coloured glasses Garth.
My guess is that the majority would choose door#1, even though some folks can’t take it cuz it bursts their little positive bubble..bubble, get it?..people love bubbles,sorry Mr.Lahey, not your Bubbles. They feel more safe in their bubble.
Garth , give us more of what we want. Don’t be afraid to plant yourself solidly in the doomer camp. Whenever you do that this site goes ballistic..in a good way !
I talk to people once in a while who read this blog, but still don’t believe what is going to happen. They continue to go out and sink into greater debt. It’s because the message here is too softy toffee. Let’s get real. when the bubble finally bursts, it will be way too late.
I talked to a young guy on the weekend who is very invested in RE , to be built 3-4 years from now in TO and Milton. He reads this blog. He asked me if I believe that it is going to crash and burn. I said, Weellll, You never know, uh, anything can happen, no one has a crystal ball. I totally lied. It was a christmas party. I didn’t want to burst his bubble. I didn’t have the heart. But I know that this young guy will suffer greatly.
It makes me angry and sad. I’m not afraid because I’ve listened to Garth,but the message needs to be amped up! Thanks Garth.

#96 Mr. Lahey on 12.06.11 at 11:07 am

#93 Ammo and Viagara

I must also clarify that the ploughing contest is not one of speed or power but of accuracy in ploughing a straight line. Johny Bravo is currently brushing up on his ploughing contest rules for this much anticipated contest.

#97 down and out on 12.06.11 at 11:17 am

I did my own reseach before I sold my family home and honestly made a monthly expense list not counting labour of all money spent on maintence from lawn mower gas to fence repair taxes etc.. I was a little conservative about future costs like roof replacement etc. and then added all the updates I had done .Now after a couple of years in the condo even with fees no comparison in insurance ,heating and cooling etc. come near the expense of the house now I am watching assessment rates of old place to new (I know I am a little anal ).Sorry Dorothy#66 this is one Boomer that will not trade the freedom to travel ,not work and enjoy life debt free to being a groundskeeper of a SFH. Be honest with yourself life needs change.

#98 singh on 12.06.11 at 11:31 am

This guy is a moron! How do you know that the USA will recover??!!??!?!

It already is. Be respectful. — Garth

#99 Daisy Mae on 12.06.11 at 11:39 am

DOROTHY: “Unlike their parents, they don’t WANT to sell their large homes and move into retirement communities, because doing so requires admitting they’ve grown old, and boomers will never do that until they’re forced to…”

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

That’s pathetic. And not true. Retirement communities are not for ‘old’ people — they are geared to ‘active seniors’. The homeowners are free to travel knowing their properties are maintained and secure while they’re away.

#100 Macrath on 12.06.11 at 11:42 am

Vanguard ETFs™ begin trading on Toronto Stock Exchange

https://static.vgcontent.info/crp/intl/caw/documents/press-release-12-07-eng.pdf?20111205|114309

#101 eaglebay - Parksville on 12.06.11 at 11:49 am

#66 Dorothy on 12.06.11 at 3:49 am

I cannot imagine anyone working hard all their life so that in the end they get to live in their “dream home”.
What a life. What an ambition. What a waste.
You have one life and this is all you do with it.
What do they do with their “dream home”?
Look at it? Brag about it? Paint it? Fix it?

#102 Daisy Mae on 12.06.11 at 11:56 am

GARTH: “Sad but untrue. Do some research and you will see how little resources Boomers have. Selling will be the solution of choice. BTW, Jobs was only 56. — Garth”

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

I remember overhearing conversations among the employed many years ago bragging that they were spending ALL their money, were not saving…and that the government would look after them when they retired.

Such talk literally took my breath away….wow! So I guess some get what they deserve?

#103 Canadian Watchdog on 12.06.11 at 12:00 pm

Here is your monthly manipulated TREB stats. Actual YoY change is +8.9 while TREB reported it close to 11%. If you didn’t know, since July TREB started reporting year-over-change by comparing 2011 seasonally adjusted sales figures to 2010 unadjusted sales figures. If this was in America, TREB would have been sued already for reporting misinformation.

TREB Stats http://i41.tinypic.com/25q5htl.png

As for sales, detached/semi average home prices continued to rise while the average condo price declined.

http://i40.tinypic.com/ejcky.png

#104 eaglebay - Parksville on 12.06.11 at 12:08 pm

#74 Beach Girl on 12.06.11 at 7:06 am

What is the lawn for?
What do you do with your lawn?
You grow your lawn, you cut it and then what?
People complain about wasting resources and then they grow a lawn. And then, they over consume by buying more house then they need.
To complete the vicious circle, people are against our uses for oil, coal and mining activities.
What happened to common sense.

#105 Mr. Lahey on 12.06.11 at 12:21 pm

As a gesture of appreciation to the sagacious bearded one, Sunnyvale Trailer Park has decided to make him an honorary citizen of our park and will be presenting him the key to the park during the first annual Sunnyvale Trailer Park Greater Fool Blog Dog Christmas Party.

Can I have the key to your Silverado with the balls instead? — Garth

#106 Makaya on 12.06.11 at 12:24 pm

S&P downgrade, if it happens, is meaningless. — Garth

Or maybe it is… Credit rating agencies, whether we like it or not, still have a huge influence. The markets are always ahead of the rating agencies, but a lot of pension funds, for example, are not allowed to invest in a product that doesn’t receive AAA rating. That’s the big problem for the European countries like France and Germany. Unlike in the US where the Fed can buy as many US treasury bonds as necessary, in Europe the ECB is normally not allowed (although it’s doing it for Greece) to buy Eurozone members treasury bonds. And despite the french big push to change that, Germany is fiercely fighting against it. Merkel seems to have won that battle for now.

The big problem is: who’s going to come up with enough money to buy those European bonds now? Nobody unless the interest rate paid on these bonds is much higher, which will worsen their economies, which will in turn lead to further downgrade, etc. It’s a vicious circle that’s just starting and that can bring the world to a mess worse than in 2008.

If it was so meaning less, I would like to know:
– why are the European leaders bitterly criticizing S&P?
– why are all the European Countries rushing to deepen their fiscal integration?
– why are all the European governments announcing one after another austerity measures?

“European policymakers criticized the timing of the announcement, just three days ahead of a make-or-break EU summit on Thursday and Friday, and said the agency hadn’t taken into account proposals for far-reaching reforms of the euro zone’s debt rules agreed by the leaders of France and Germany on Monday.”

“Luxembourg Prime Minister Jean-Claude Juncker said the S&P announcement was “like a knockout blow” to countries that were cutting their budget deficits.”

“The S&P warning piles pressure on the EU leaders to agree on a convincing strategy. On Monday, Merkel and Sarkozy agreed to propose changes to the EU treaty to impose budget discipline across the euro zone through automatic sanctions and balanced-budget legislation in national member states.”

“Bank of France governor Christian Noyer, a member of the governing council of the European Central Bank, said on Tuesday that ratings agencies were in danger of themselves worsening the euro-zone debt crisis.

“The agencies were one of the motors of the crisis in 2008. Are they becoming a motor in the current crisis? That’s a real question we all need to think about,” he told a conference on corporate finance in Paris.””

Meaningless, really?

http://www.spiegel.de/international/europe/0,1518,801973,00.html

Yup. Just like the S&P comedy show regarding US debt. Meaningless. — Garth

#107 eaglebay - Parksville on 12.06.11 at 12:36 pm

Self fulfilling doom and gloom.
Come on people, get to work and live.
We are the economy.
Can’t believe that most contributors on this blog are such losers. Read on.

“There was an older man called Joe who really knew how to cook hamburgers and hot dogs well. In fact, he even had a secret recipe for the relish that he put on the burgers and dogs, which most people really liked. He had inherited the secret recipe from his father who had also sold hamburgers and hot dogs really well. The business was called Rainbow Burgers.

Joe’s father’s business was a very successful takeaway business and it was Joe’s father’s legacy to him.

Joe hoped to pass on this legacy to his son Henry, who was now living in a big city a hundred kilometres away from his hometown. Joe advertised regularly in the local magazines and newspapers of his home town. Rainbow Burgers did not have a sit-down restaurant. People just ordered by phone or queued outside the shop or waited on the few chairs provided. Not having waiters to pay and other overheads like lighting, cleaners’ salaries and crockery and cutlery really kept Joe’s overheads down.

One day his son came back to the hometown from the big city. His son told his father, “Hey Dad, the economy in this country is really doing poorly. A lot of people just can’t afford to buy luxuries such as takeaway food like what you make. I think you had better be very careful with your business. Maybe cut down on your advertising costs.”

Old Joe thought, “Hmmm, my son must be right. He is very bright and he has received a good education in the city where I sent him myself to learn. I had better stop spending so much money on pamphlets and advertising in the local magazines and newspapers. It is a lot of money.”

So Joe stopped spending as much money as he did on advertising his wonderful hotdogs and hamburgers. Sure enough, you guessed it, fewer and fewer people bought his hamburgers and hotdogs. And, inevitably, his business got worse and worse until one day he took out the keys for the Rainbow Burgers takeaway shop and locked the door for the last time. “I am closing my shop forever,” Joe said. “My son was right. People cannot afford to buy my hotdogs and hamburgers anymore, so my business has failed.””

#108 Form Man on 12.06.11 at 12:43 pm

#97 Mr. Lahey

I welcome the switch back to tractors. As a builder and former logger, I am supremely confident in my abilities to plough a straighter ( and faster ) furrow than westernman.

I still have my doubts that westernman will show up. Remember, this is someone who is stuck in a cesspool of despair. He strikes out at everyone in his anger and childish hate, whilst hiding behind his online identity. Cowards such as westernman can not bear the humiliation of certain defeat.

#109 Snowboid on 12.06.11 at 12:44 pm

#92 Guan-Di on 12.06.11 at 10:22 am…

Re: Dorothy 66

I second that, I cannot understand the boomers who decide to sit, rotting in their McMansions, eating KD so they can afford to keep the roof on.

Maybe that is a small-town mentality, but as the wise Professor has clearly indicated in his post:

“…real estate-rich Boomers on the cusp of retirement, who in a year may not be able to sell. Or retire.”

How sad, indeed.

#110 Makaya on 12.06.11 at 12:47 pm

Yup. Just like the S&P comedy show regarding US debt. Meaningless. — Garth

You don’t answer the questions. Europe is not the US. The Euro is not the US Dollar.

I did. Meaningless. — Garth

#111 eaglebay - Parksville on 12.06.11 at 12:48 pm

The credit rating agencies, S&P and the like, are just a bunch of people somewhere in an office that try to decide what the world’s credit is worth.
I call BS on that. Aren’t they the ones that rated the subprime mortgage derivatives being sold on the markets as AAA?
Useless and meaningless.

#112 Mr. Lahey on 12.06.11 at 12:58 pm

“Can I have the key to your Silverado with the balls instead? — Garth”

Consider it done Garth. It is the least we can do for your gracious acceptance of coming to the First Annual Sunnyvale Trailer Park Greater Fool Blog Dog Christmas party. The whole park is buzzing with excitement. Ricky just called from the rig and he is somewhere in northern Ontario enroute to picking up Westernman’s tractor for the ploughin contest with Form Man.

#113 Mr. Lahey on 12.06.11 at 1:03 pm

#95 Disciple

“#86 Mornin’ Mr. L… here’s my hint: I have no freakin’ clue, but here is a great link to expand one’s mind’s eye”.

Thank you for the link Disciple. I am sure the universal consciousness that is present in all highly evolved souls will manifest itself through you while you are on the Sunnyvale podium. You I have total confidence in. Smoking Man has been silent on our request that he come and join us. The whole park is brushing up on its enlightened reading so that they can grasp what you will be delivering. The flight ticket is in the mail Disciple. Julian will be picking you up at the Halifax airport.

#114 Duisburg on 12.06.11 at 1:22 pm

Garth,

I have always agreed with your RE thoughts regarding Canada. But not your Gold, Commodities call. which is fine.

With that said…what are your thoughts on U.S. real estate currently (Specifically Florida)??

I am with Jon B #41 above in looking at beaten down sunshine property.

thoughts??

Why would you buy? Rental income (forget it), capital gains (could be 10 years) or personal use (that’s cool, if it’s cheaper than renting). — Garth

#115 Mister Obvious on 12.06.11 at 1:23 pm

#66 Dorothy:

You say that boomers who own empty nest, single family houses are not going to downsize. That all their life’s labours, hopes and dreams are embedded in the shingles, drywall and two by fours surrounding them. Furthermore, you say they will continue to work beyond the usual retirement age, if necessary, to retain their precious maintenance-hungry homes.

I agree wholeheartedly with you that they don’t WANT to sell. I and I agree whole heartedly with Garth that many of them will NEED to sell.

Lack of financial diversification, end-of-life health issues (dementia, osteoporosis, and diabetes), general burnout, ageism, and badly-launched (but still needy) offspring will all apply relentless pressure.

You need to be energetic and resilient to run a house. Like you were when you were, say, forty. It will start to feel quite overwhelming at seventy. When the roof is shot on your overvalued SFH you will need to pony up $20K or more to get it replaced. (Your boys probably won’t be coming over on the weekends to do the job themselves). Next will be the furnace followed by drainage problems. Then steadily increasing taxes.

Meanwhile, the huge gasbag of unrealized equity in your home will begin shrinking back to the value it should have had were it not for decades of pulling forward wealth from the distant future.

All current indicators (endlessly covered in this blog) suggest the residential real estate landscape will be a very dismal place by the time one realizes the towel should have been thrown in several years earlier.

#116 pbrasseur on 12.06.11 at 1:32 pm

Today, after many months of grinding: DOW > TSX

Mark this day, it’s an important sign of what’s to come for Canada…

#117 Trev16 on 12.06.11 at 1:48 pm

Garth,

Hi, I love your optimism in regards to the US recovering after the 2012 election. The US has only 1 hope in 2012 and that is Ron Paul. If he does not win it is game over for the US. They will not be getting up on their knees…..instead they will be preparing to be buried 6′ under.

When this happens we in Canada will be dragged down as well and then we will find out what exposure Canadian Banks have to this financial disaster. I suspect it won’t be all that rosy.

You have to love the US….Bill Clinton receiving $50,000 per month before MF Global goes under. Corzine still not charged. The financial system has so much rot it must be purged.

Maybe one day Garth you can do a blog on the health of the US Banks and their quadrillion worth of derivatives?

Cheers,

Trev16

If RP wins, you’d better have a tent and a rifle. — Garth

#118 Dorothy on 12.06.11 at 1:55 pm

#92 – Guan Di
Not everyone has the same idea of what makes a “good’ retirement, or a “good” life for that matter. When we Boomers were young, home ownership seemed just as unattainable to us as it does to young people today. Many of us felt priced out of the market. Our parents (who today are in their 80’s) bought RE low and sold high when we Boomers began buying and starting families. The sheer demographics of having too many people chasing too few houses pushed the prices sky high. Sure there were a couple of busts when prices fell again, but along with those price drops came job insecurity and the economic fear recessions always generate, so those times were not always seen as good times to buy (sound familiar?). And once the recessions were over, the prices came roaring back again.
Consequently, in order to buy the McMansions many of you blog dogs ridicule Baby Boomers for owning, those Boomers had to work long hours and sacrifice for. And rightly or wrongly, it became a way of life to do without in order to own a house. I know one guy who owns a half million dollar home who hasn’t had a vacation in over 30 years, and has no interest in taking a vacation, even though he can now probably afford to do so. But working long hours and living frugally has become so much an ingrained part of his life that he doesn’t know how to live any differently. His house represents everything that he has worked and sacrificed for since he first entered the workforce, and to give it up would be equivalent to saying his entire life has been a sham. So from a purely emotional point of view (as opposed to a more rational, economic one) selling his home is not an option for him. And there are many Boomers who are just like him. I’m not saying these people are right; I’m just saying it’s the way they are.
My own experience is a little different in the sense that I never desired a “McMansion” and consequently lived a more balanced life and now live in a paid for modest home. But even I would be reluctant to sell my house and move into a condo or a retirement community, because I would see that as a step backwards. It took me a lifetime to get what I have, a nice house in a nice area, and I won’t give it up unless I have absolutely no other choice. Unlike my friend I did have some nice vacations while I was younger, and wouldn’t feel the least deprived if the only vacations I have from this point on are camping trips fairly close to home.
To fund a retirement of world trips etc. requires a lot more money than the average person could ever save in a lifetime, and is an unrealistic goal in my opinion. Besides which, as you get older, travelling becomes less enjoyable (unless you’re rich enough to travel first class). Whereas living in a nice home, in a nice area, surrounded by family and friends, can be very enjoyable and affordable (even if you have to watch the pennies). Because Boomers have become accustomed to working hard and doing without in order to fund home ownership and all that it entails, it will not seem unnatural to them to continue to do so past the age of 65 if necessary. And that fact, combined with the fact that many Boomers link their job with their definition of “who” they are, and where they fit into society, suggests to me that they will not retire and sell their houses unless they have absolutely no other choice. Again, I’m not suggesting that working till you drop is the RIGHT choice, I’m simply saying it’s the lifestyle option many will choose.

#119 Fabrega on 12.06.11 at 2:14 pm

“As Europe rots and the US staggers to its knees…”

“As global demand inches higher and commodities gain, our economy will benefit disproportionately.”

I am trying to understand your logic Garth.
I can’t see where all that demand for commodities will come from. I can see some money coming in as a safe heaven but the world is awash in debt. Wages are stagnant or declining. Consumers are tapped out. Something will have to give.

#120 Form Man on 12.06.11 at 2:18 pm

#110 Snowboid

I am currently completing a SFH gated retirement community in the Okanagan, and I would like to add my two bits regarding boomers retiring:

The Okanagan housing market is very slow right now, due, I think, to the following factors :

1) there are not enough first time buyers coming into the market to ‘get the wheel moving’

2) retirees tend to stay in SFH’s for a short time compared to younger buyers ( due to health or death ), so the market requires a continual new supply ( much larger than for a diverse market )

3) price

the observation I would make is this :

there may not be enough SFH buyers to absorb the boomer’s homes, leading to stagnation and price declines across the board. Because of it’s unique demographic, Kelowna may be an accurate ‘canary in the coalmine’ for the rest of Canada

( sorry for all the cliches )

#121 Dorothy on 12.06.11 at 2:31 pm

#116 – Mr. Obvious
I agree that for all the Boomers who don’t WANT to sell, there will probably come a time when due to ill health they may HAVE to sell. But that time is a long way into the future for most.
The idea that retirees sell the family home and move into retirement communities began with my parent’s generation. Retirees prior to that usually stayed in the family home until they either died or were unable to continue living there for either health or economic reasons. My grandparents stayed in their family home until they were in their mid 80’s, and it was only sold when my grandfather died and my gran moved in with us. My friend’s grandmother lived in her own home until she died at the age of 92. It used to be commonplace to see old people living out their lives in the homes in which they raised their families. So all I’m suggesting is that society may gravitate back to a way of life that used to be the norm.
Back then, whether the real estate market rose of fell wasn’t part of the equation when deciding whether or not to continue living in the family home past retirement. Because homes were not seen as investments; merely as a place to live until you were either called to live with your maker, or unable to live alone any longer. And that is the way real estate will return to being seen; a place to live and make memories in. And it is those memories that many Boomers will be reluctant to give up.
As for having to work past 65 in order to make staying in that home possible, well again working well past that age was not uncommon to those of my grandparent’s generation. My grandfather was self employed, and worked right up to the day he died. He could have afforded to “retire” but chose not to, and there were many more like him. Even amongst those who were employees and forced to officially retire, many continued to work part time or on a contract basis. Because to them, our modern idea of stopping work in order to enjoy a life of leisure, was a totally alien concept.
Most of those you see who are currently living the modern retirement lifestyle are not Boomers, but pre-Boomers. Boomers are only just begining to retire this year, and the majority are still in the workforce. And it is these “true” Boomers that I am referring to when I say most will choose to work past the age of 65 and remain in their homes.

#122 jess on 12.06.11 at 2:42 pm

Nasrallah
He also offered his support to the Syrian government and accused the United States of plotting to destroy Syria…..”We support the reforms in Syria and we stand with the regime against the resistance movement,” he said.
=================

The article says:
“Illicit outflows are not new to Syria. An upcoming report by Global Financial Integrity estimates that from 2000-2009, Syria lost $23.6 billion from corruption, trade mispricing, bribery, and other illicit activity. In a country with a per capita GDP of just US$2,891 in 2010, these outflows represent a loss of US$1,048 for every Syrian citizen. GFI’s study also finds evidence that bribery, kickbacks, and corruption increased dramatically from 2005-2009. It’s no wonder that Syrians are discontent.
An international shadow financial system is enabling wealthy Syrians, including corrupt public officials, terrorist financiers, and tax evaders, to move their money into safe havens offshore. In many countries, including the United States, individuals can form shell (anonymous) corporations to shield their money from the eyes of authorities. It was one of these shell corporations that allowed the government of Iran to own a skyscraper on Fifth Avenue in Manhattan for over 30 years before it was seized in 2009. Iran was able to evade sanctions for years using many layers of anonymous corporations, and it is likely that the regime in Syria uses similar vehicles to circumvent international sanctions.

Countries like the United States can make it more difficult for corrupt public officials like al-Asad to smuggle stolen assets out of their countries by eliminating anonymous corporations and strengthening anti-money laundering laws.”
http://www.financialtaskforce.org/2011/11/30/after-years-of-leakages-syrian-capital-flight-likely-intensifying/

…. “The collapse of the Gaddafi regime in Libya revealed billions of dollars hidden offshore, representing proceeds from four decades of corrupt rule. In October, The Los Angeles Times reported that Moammar Gaddafi and his family hid more than US$200 billion in assets—more than US$30,000 for every Libyan citizen—across the globe. While U.S. and European authorities were able to freeze over US$67 billion in assets, the remainder is still hidden.

#123 GregW, Oakville on 12.06.11 at 2:48 pm

Hi Nostra, You might recall that Canadian beef was temporally stopped by Japan, when the mad-cow issue started. I wonder if anybody in Canada is actually checking the produce from Japan for contamination??
And fish from the Pacific.
I wonder if MP Harper’s family food is getting checked?
I wonder if the “Harper Government” will be open and transparent with info and/or test results?

This article doesn’t sound at all good for people living in Japan. IMO.

“Post-Fukushima Radiation Mapped
Cesium in soil a problem for agriculture”
http://spectrum.ieee.org/energy/environment/postfukushima-radiation-mapped

“New Leaks at Fukushima Nuclear Plant.” Dec 5
http://spectrum.ieee.org/tech-talk/energy/nuclear/new-leaks-at-fukushima-nuclear-plant

You might also be interested in this Dec 6 article too?
“Qbo Robot Passes Mirror Test, Is Therefore Self-Aware”
http

#124 rana on 12.06.11 at 2:54 pm

I think people are missing the point about WHY boomers selling their homes. I highly doubt people want to sell their Mcmansions just to downsize. First people bought RE for an “investment” meaning some peoples retirement income is solely based on selling their home for a lot more than they paid for. However many people borrowed against their mortgages thinking the price of their house will always be $600,000 and increase forever more. But we all know and I guess speculate that when poo hits the fan and prices drop and they owe money they will inevitable HAVE to sell because they got into debt and realize they have much less money and “equity” in their homes. This goes for ALL people- not just baby boomers- many people were roped into thinking that the value of houses will forever increase and borrowed lots of $$$ against their homes.
You see baby boomers just like the rest of the world are human and accumulated much more debt than their homes can save them from.

#125 Victoria on 12.06.11 at 2:59 pm

Many people can’t work past 65. After 60 cancer is on an upswing. It is not if you get it but when. Chemo can totally destory an otherwise healthy person.
People start dropping like flies. 1/4 of people 65 have the start of Alzheimer and it moves pretty fast.

Do companies really want old people to be working there – other than Walmart greeters. If people could sell the house to afford a nice retirement I think most would sell.

I know this sucks but I think people are afraid to face facts about aging.

#126 GTA Girl on 12.06.11 at 3:00 pm

Stupid girl on CTV news channel, giddy at today’s sales numbers and Remax’s crystal ball prediction of 12% more increase in next years home values.

“My condo is making me so much money!”

She needs a slap.

#127 Timing is Everything on 12.06.11 at 3:11 pm

#100 Daisy Mae – Retirement communities are not for ‘old’ people — they are geared to ‘active seniors’

Like the Rolling Stones.

#128 T.J. BONES on 12.06.11 at 3:19 pm

pbrasseur 12/06/11 @ 1:32 pm Sir Garth. months ago I brought this to Garth’s attention. He said I should get a hobbie. It tells us that the USA is starting to awaken and start a powerful recovery. He has been hinting at this for a while. The USA is ready for a restructuring of the financial sector, the people want it only a fool would try to stop it. The us was born out of revolution, it’s in their DNA. Also when is the Sunnydale Trailer park blog dogs party ? The date ?

#129 TheRealTruth on 12.06.11 at 3:30 pm

Turnergate??

c’mon Garth, who’s responding to our comments?? The responses are too nice but signed by you!

Bug off. — Garth

#130 oxymoron on 12.06.11 at 3:33 pm

CREA’s Code of Ethics and Standards

http://www.realtor.ca/StaticPage.aspx?f=RealtorCodeOfEthics

#131 Two-thirds on 12.06.11 at 3:39 pm

“As Europe rots and the US staggers to its knees, AAA Canada will beckon. The dollar will continue a jagged ascent.”

Fully agree – the downside is: a weak US is a weak customer (our main customer, incidentally), so the high CAD (I assume that is that you meant by “dollar”) would be negative to our trade balance.

“As global demand inches higher and commodities gain, our economy will benefit disproportionately.”

So, Europe and the US will be on the ropes, but global demand will somehow increase? If the BRICs are to provide this demand, they would have to find markets other than the above two – how can emerging countries grow with a decimated global customer base?

This may or may not happen – I would change “As” for “If” in Garth’s statement.

“For all their sub-prime faults and insufferable gall, our banks will continue to be viewed as granite.”

Agree – in the land of the blind…

“As America slowly recovers after the 2012 election, rising demand for natural resources will boost exports and restore jobs.”

If true (again, “If” may be a better word to use than “As”), then this would mean provinces with natural resource-based economies “are different this time” – ergo – go buy a house in the Prairies (sarcasm).

This may or may not happen – there is a glut of natural gas in North America. Nuclear energy may have fallen out of favour in the post-Fukushima world. Coal is a dirty word, and oil sands are no better. Keystone is uncertain. Lumber demand is unlikely to rise, unless housing starts rise in the US. So perhaps potash will fit the bill.

“For global investors lusting for certainty and fleeing sovereign debt risk, this country will seduce. Surely you can see it.”

Agree – perception will win the day. The question is, what happens when Canada goes into recession too?

All in all, Canada will be one of the best places to weather the storm – if one is liquid and debt-free. But a storm will happen and all of us (prudent and fool alike) are going to get soaked.

#132 Timing is Everything on 12.06.11 at 3:39 pm

#105 eaglebay – Parksville – What do you do with your lawn?

It’s her lawn. Who cares?

#133 Cato on 12.06.11 at 3:53 pm

Recently ran into a hedge fund manager at a startup launch party in San Francisco. Dull event so talk meandered from the insanity of Silicon Valley to Canada. He had some chilling insights into where we are likely headed and I frankly couldn’t find fault with his logic.

Canada will suffer the most from the collapse of the US credit bubble, the long term effects will be far worse for Canada than the US itself. When our consumer spending is driven by their consumer spending Canada becomes the one with the larger long term problem. It doesn’t matter how prudent we think we are (we aren’t) its simply a case of large social spending commitments coupled with a small population base and too much reliance on single trading partner. Layer a housing/credit bubble ontop of that and the picture becomes downright grim. Canada’s one saving grace is its resource base. This asymmetry is likely to result in a long term economic boom for some while others suffer under what feels like a long term economic depression. Not everyone gets to work in the oil patch (or wants to).

The US is slowly recovering but this nascent recovery will not be exported to its allies as it was in the past. It will use its competitive advantage over its allies to rebuild a shattered labour market, jobs lost to Canada over the last 50 years will be repatriated and there isn’t much we can do about it.

The long term societal picture becomes even bleaker where we see an actual class structure develop that resembles the structure emerging in the US. We will see generational poverty emerge, children born in poverty cannot escape it through work ethic or education like they can today. Maintaining social class structure will suddenly become important for those who have to protect themselves from those who have not.

The conclusion is Canada is now entering a long term downward trend it cannot escape. The theme is the Canadian entrepreneur is far better off immigrating to the US to pursue opportunities and merge with US capitalism for everyone’s benefit. I hate to admit it but after seeing and experiencing the hostility exhibited by federal and provincial governments towards entrepreneurship I think the argument might be correct. Since I’m now essentially retired I’ll decide to stay put for lifestyle reasons but I often point young hopefuls to greener pastures in the US and into the waiting arms of american venture capital. Canada deserves none of our efforts.

#134 Harlee on 12.06.11 at 3:58 pm

For me, I can’t wait until Garth’s “End of the Year” posting (or will that be a 2012 New Years posting..?).I am hoping it will sum up all that has happened in this past year : The good,the bad and the ugly…(not to be confused with the classic movie). Just 25 more days to go !

#135 Daisy Mae on 12.06.11 at 4:02 pm

EAGLEBAY: “What is the lawn for? What do you do with your lawn? You grow your lawn, you cut it and then what?

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

Good questions. I proposed xeroscaping to our council and received a flat ‘no’. As it is we pay over $100,000 per season to cut and water grass…ludicrous. Such a waste of water! And the monies saved could go into the Contingency Fund and put to GOOD use such as eventual roof replacement. Can’t teach old dogs….

#136 Death by News on 12.06.11 at 4:03 pm

Hi Garth,

I would love to hear your take on this article from todays Edmonton Journal:

http://www.edmontonjournal.com/business/Lamphier+Welcome+Edmonton+city+that+works/5815068/story.html

Hell, maybe even a topic for a blog entry?

I am still bearish on housing in Edmonton (a quick look on MLS shows way to many overpriced dots), but even I must admit that I don’t know anyone employable who is looking for work these days.

#137 Coho on 12.06.11 at 4:17 pm

So, a turning point. The era of the house ends. The age of liquidity begins.

The hell of it is, you never know the moment, until it’s gone.

Well put. Massaged just a little:

“So, a turning point. The era of liberty ends. The age of Martial Law begins”

“The hell of it is, the slumbering masses never knew what hit them, until it was too late”.

The above would be great sub-headings for a potentially best selling book titled, “How To Thrive Under Martial Law”.

http://www.youtube.com/watch?v=rN-6Bmw_UIA&feature=channel_video_title

And of course, Canada will follow suit.

#138 disciple on 12.06.11 at 4:21 pm

At any of the major retailers, I see many near-to-be-seniors that are not looking too happy to be there still working for the man. At the large unionized outfits in this country, there has been a silent war raging against benefits, perks, privileges, pensions, and now social security is the next target for the slow but steady acrimonious barrage of the debt collectors (banksters and their buddies).

An entire generation who’ve been schooled and fooled into the belief in the myth of the social contract. But you know what? I don’t think they give a rat sass about their own dire situation. I don’t blame ’em. As long as the booze is flowing and the weed is growing, as long as the kids don’t bother them anymore, and as long as the Feds keep the illusion going “just one more year” as they tell me over and over, wouldn’t you do the same?

While we were trying different things
And we were smoking funny things
Making love out by the lake to our favorite song
Sipping whiskey out the bottle, not thinking ’bout tomorrow
Singing Sweet Home Alabama all summer long

Which is a tribute to the old mind control gem:

In Birmingham they love the governor
Now we all did what we could do
Now Watergate does not bother me
Does your conscience bother you?
Tell the truth

Why do you suppose modern artists like to “borrow” the music from the past decades? Because the copyright expired? NO! Because they are instructed to do so. These audible potions of beat and rhythm interlaced with alluring melodic yet repetitive chants about nothing at all, based on the 440 MHz frequencies as opposed to the natural and divine 432 MHz frequencies are designed to induce an altered conscious state. And damn it dougie, does it ever work like a charm…

They do the same with the movies, the sports (I told you the Leafs would be doing great this year) and of course they do it with the NEWS. Reichstag fire anyone? How about a latest yet mind-numbing Terra-ist attack in Afpak? Oh, look, Tiger Woods is back, yay! Because I was really worried there…

Once you step back and escape the illusion that is your culture, the primitive construct that is your life, step away from those creature comforts which you take for granted and do not give thanks for every moment in your words, deeds and attitudes… you will see nothing. Nothing at all. Some have called it the blackness, but what I would say is that there is nothing there but a silent fractal. In other words, no less challenging, if there were no YOU, there would be nothing else either. YOU are no less or more important than the entire universe itself. For those who understand: Welcome to eternity.

#139 Mr. Lahey on 12.06.11 at 4:25 pm

Just finished chatting with Garth and the doomer sentiment is reaching epic proportions it seems. If Garth could help me see that the shithawk storm is not going to be as bad as some of you envision then there is hope for all of you. Hey Form Man, have you been practising your ploughing in a straight line? Westernman, have that tractor ready for pick up tomorrow. Ricky is making good time on reaching your prairie spread. Wonderful thing this GPS is although Ricky has been confused by it and keeps calling back to the trailer park for reassurance he is heading west. Bubbles is taking good care of the Clydesdales in preparation for our sleigh ride with the sagacious host of this blog. All is proceeding according to plan for the first annual Sunnyvale Trailer Park Greater Fool Blog Dog Christmas Party. The misfits in the park can’t wait to hear Garth trounce Flaherty in their debate, although in keeping with the Xmas good spirit of it all they will toast each other afterwards.

#140 Ronaldo on 12.06.11 at 4:34 pm

Glimpse from the past.

http://www.cbc.ca/news/business/story/2008/12/09/bankofcanada.html

And here we are, three years later. What’s next? Another rate drop? Jeannie Lee seems to think so. At least that’s what I thought she said on CNN this morning talking about the fact that the BOC rate had been at .25 and thre was still .75 of wiggle room left. What to believe?

#141 disciple on 12.06.11 at 4:38 pm

#134 Cato…”The conclusion is Canada is now entering a long term downward trend it cannot escape.”
———————————————-
My friend, you wear your heart on your sleeve, I like that. But listen. Get a grip on reality. Canada has resources up the ying yang. If our exporters do not continue to engage China, then it’s India, if not India, then it’s Thailand, if not Thailand, then Vietnam, if not Vietnam, then it’s Brazil, if not Brazil, then it’s Chile, if not Chile, then it’s Georgia, if it’s not Georgia, then it’s Turkey, if not Turkey, then it’s … you get the picture. The world needs what we have, namely 25% of the world’s fresh water to start.

And I don’t agree with the class structure thesis. Technology will see to it the trend towards abolition of the class structure will continue along just fine as long as we don’t continue to get mind-controlled into doing a lot of NOTHING; for example, by hiring leaders who really only work for bankers, and who can only see one trading partner ramming them one way, if you know what I mean.

Get invested in Canada or get out. Only losers try to “escape” and then justify it by blaming their leaders. It isn’t poverty we should be escaping, it is the very tyranny you are afraid to face. When was the last time you spoke out in public about the Harper Government? You have got it all backwards, unfortunately. Black is white, and white is black, the checker-board pattern of Freemasonic Lodges and popstar divas springs to my mind.

#142 Form Man on 12.06.11 at 4:38 pm

OMREB ( Kelowna )

real estate stats for November 2011 just out

total sales = 258
total listings = 4475
MOI = 17.34

DA’s unmotivated sellers are still sticking with their listings……amazing determination in these folks……

#143 HolyCow on 12.06.11 at 4:44 pm

Read:

Housing: After the Bubble Bursts

http://www.newworldparty.org/2011/11/housing-after-bubble-bursts.html

“Many Canadians believe that when this housing bubble bursts, they will have a soft landing, unlike the American’s. They say that the outcome for Canada will not end in a disaster like it did for the U.S. economy, because Canada did not have AAA rated CDOs (Collateralized Debt Obligations), NINJA loans, etc.

True, Canada did not have these, but neither did Spain, Ireland or Japan. Nevertheless, Spain and Ireland are now worse off than the U.S. Here is a comparison:”

#144 Luke on 12.06.11 at 5:03 pm

Remax has proven you wrong!

/sarcasm

http://ca.reuters.com/article/businessNews/idCATRE7B51YX20111206

Well at least they admit that the price gains this year are defying conventional logic! I guess you can’t ask for more than that from the RE industry…

#145 Snowboid on 12.06.11 at 5:06 pm

#121 Form Man on 12.06.11 at 2:18 pm…

I agree.

We have watched interesting properties gradually drop, or taken off the market. It’s tough to decide when to get back in, especially since we have seen what happened in the Phoenix area.

Initially, we thought 2012 – but it may be 2013 – we are patient, have a gracious and generous landlord in the Okanagan, and are more than happy with our investment returns.

BTW, I tried to find a comparable property in Kelowna to what we paid down here for a SFH in a great neighbourhood on 1/4 acre lot. Nearest pricing is trailers in West Kelowna, on leased land.

We may rent in the Okanagan ’till we die!!!

#146 jess on 12.06.11 at 5:14 pm

How Big Banks Finance Billions In Predatory Payday
About 120 million payday loans are made annually in the U.S., with an average interest rate of 455 percent

– Major banks provide over $1.5 Billion in credit available to fund major payday lending companies.

and these lenders received TARP bailout funds !
About 120 million payday loans are made annually in the U.S., with an average interest rate of 455 percent

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On Friday, Rep. Ed Markey joined Sen. Al Franken in demanding answers from Carrier IQ, the company that has worked with mobile carriers to install a hidden application that has the ability to secretly track nearly everything users do — including the keys they press, the numbers they dial and the websites they visit — on more than 140 million cellphones. Researcher Trevor Eckhart uncovered the secret app
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Millions hit by $2billion in mystery phone charges hidden on their …www.dailymail.co.uk/…/Millions-hit-2billion-mystery-phone-charges…You +1’d this publicly. Undo
14 Jul 2011 – The investigation found there is a loophole in the law which allows for third party billing on cell phone bills from companies which provide …
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FCC cracking down on phone-bill cramming – Business – Consumer …www.msnbc.msn.com/…/fcc-proposes-crackdown-phon… – United StatesCached
You +1’d this publicly. Undo
ConsumerMan – msnbc.com contributor

The problem is especially thorny for cell-phone users, because many bill legitimate third-party services (such as ringtones and downloads) to their wireless bills.

=
A study that lasted for a year was published by the Commerce, Science, and Transportation Committee and found that Americans were charged about $2 billion in so-called mystery fees in a single year which is called “cramming”. The charges show up on the often confusing bills for landline phone services and typically the customer billed never receives the services charged for. A hearing was held in Washington to ask major telecom companies what the charges are about.

Senator Jay Rockefeller, a Democrat from West Virginia, asked an industry rep why major telecom firms like AT&T hadn’t stopped the unauthorized charges on phone bills by third parties. Rockefeller said, “It’s illegal, it’s wrong, it’s scamming. Why haven’t you cleaned up your act?”

The industry representative the question was posed to is Walter McCormick, president and CEO of the U.S. Telecom Association. McCormick said, “The industry has taken significant steps. Even the report that you issued today indicates that there has been improvement, but it remains a very, very significant, very pervasive problem.”

The report also points out that the phone companies receive a fee of a few dollars from the third-party billers and these fees can add up to a significant amount over time with the number of customers the phone companies have. AT&T, Verizon, and Qwest made about $650 million over the last five years from these fees alone.
Report: Unauthorized Third-party Charges to Landline Phone Bills Cost Americans $2 billion a year
Shane McGlaun (Blog) – July 14, 2011 1:28 PM
http://www.cnn.com/2011/US/07/13/phone.charges/
Carriers Admit to Installing Hidden App
Friday 2 December 2011
http://www.truth-out.org/carriers-admit-installing-hidden-app/1323187523

#147 Tony on 12.06.11 at 5:15 pm

We finally see the start of major selling in the Canadian bank stocks today. The most overvalued of any class of assets on planet Earth. As the housing market erodes and goes into a freefall credit in this country will dry up drier than dustbowl Oklahoma. If you have any long position in any of the Canadian banks unload while you still can.

Your comments are among the least well-informed on this site. At least you are consistent. — Garth

#148 Van guy smokin now on 12.06.11 at 5:26 pm

#130 TheRealTruth on 12.06.11 at 3:30 pm
Turnergate??

c’mon Garth, who’s responding to our comments?? The responses are too nice but signed by you!

Bug off. — Garth

C’mon dude. Garth is having a good day. Now you just pissed him off again. Garth has never answered nicely to so many comments.

#149 Bill Gable on 12.06.11 at 5:31 pm

Allow a sidebar: GENEROSITY and the spirit of giving – after all, why are we here?

“BC anesthesiologists could have given themselves bonuses, but they decided to give it back instead. They’re putting $3 million of their own funding into efforts to hire extra staff to help high risk pregnant mothers and their babies.”

> That’s the kind of stuff that makes me want to jump up and yell the “BETTER self will win every time” – hope it makes you feel good too.

Now back to the topic – apologies, Mr. Turner.

http://tinyurl.com/77dcmtm

#150 triplenet on 12.06.11 at 5:37 pm

Mr. Lahey:

I am in deed interested in joining the Sunnyvale party – however I hope there will be sufficient security detail in case there is a punch-up or other rowdy behaviour.
I have been to NS a few times over the past year or two. The last time I hooked up with Lucy (while Ricky was in jail) and as you probably know – that little kid is mine (I think). Lucy and I met at the local university/college and consequently we both got fired from our teaching positions (no pun intended) as a result of us knowing the “goings-on” at Suunyvale.
In case Lucy and I have to sleep in the car this time – will I have some “protection” and will you have a supply of empty plastic milk jugs to go with the offsales?
Will there be a cheeseburger barbeque as there should be no shortage of bbq’s? Do we have to make sure our vehicles are insured, even if we are just driving around the park?
Probably not too many other rules I guess.
Is this party on Boxing Day?

#151 Tony on 12.06.11 at 5:37 pm

Re: #71 Onemorething on 12.06.11 at 6:18 am

You forgot the top for stocks on the first few days of January of 2012. Should get at least a 50 percent pullback and then a sideways to down market for the next 15 years.

More idiocy. — Garth

#152 Westernman on 12.06.11 at 5:52 pm

Mr. Lahey,
Ammo&Viagra is right about the Massey ferguson part but I’ll be bringing a 6280 to the party which should be more than enough ooomph to bury Form Man…who buy the way should change his name to Mr. Cliche.

#153 jas on 12.06.11 at 6:00 pm

#63 Cristian
Garth I think the above comment deserves a fair reply and you ought to give it with supporting numbers, if you have them.
thanks

How does a guy who says “I could go on, but I need to vomit,” deserve more of my time? — Garth

#154 Form Man on 12.06.11 at 6:11 pm

#140 Mr. Lahey

No need for practice. I have the latest gps guidance system on the John Deere 9620 I am bringing ( which will absolutely destroy the MF 6280). Ploughs lines as straight as the unibrow on westernman’s forehead. In any case it doesn’t really matter as I have heard that the only thing westernman can drive is himself into the poorhouse………

#155 Ammo & Viagra on 12.06.11 at 6:13 pm

#105 eaglebay – Parksville – What do you do with your lawn?

It’s her lawn. Who cares?
—————————————
She uses one of those most annoying leaf blowers..can’t stand those noisy pieces of %$#@@
Raking is much faster and quiet and good exercise..

#156 Ammo & Viagra on 12.06.11 at 6:22 pm

#134 Cato,
No, you’ll just start collecting your free health care..it’s all downhill from here.
1st knee and hip replacement $32k
2nd double bypass…$35 K
3rd chemo therapy 2 months 20K
By the time you kick the bucket , you’ll cost the system 10’s of 1000’s, maybe over 100K, ka-ching

#157 Form Man on 12.06.11 at 6:24 pm

#153 westernman

‘buy’ the way ? spell much ?

#158 Westernman on 12.06.11 at 6:33 pm

Form Man,
I think you will show up with a lawn chair and a bottle of scotch, and a king-sized barrage of bullshit.

#159 Mr. Lahey on 12.06.11 at 6:46 pm

#151 Triplenet

There is no need to worry about security at the park Triplenet. As I have indicated, all the misfits in the park are doing a stellar job of cleaning up their act for this first annual Sunnyvale Trailer Park Greater Fool Blog Dog Christmas Party. Ricky and Cyrus have had their guns sent away in case they have a relapse. Now what kind of Christmas party would it be if it was held on Boxing Day? It will be held prior to Christmas, the date will soon be finalized. As to sleeping in a car, you have not read my prior posts as I have made it clear that trailers are being made available for all blog dogs (the granite counter top one is reserved for the bearded sage who authors this blog) and the food will not be burgers but only the very best money can buy as Ricky has had a stellar year shorting everything under the sun with the Sunnyvale slush fund. Speaking of Ricky he just called and said he is stopping for a quick bite enroute to Westernman’s farm. I assured him he is indeed heading west and that the GPS is working fine. (Poor Ricky never made it past Grade 10). Bubbles, Julian and the rest of the gang are excited to have you coming to the party Triplenet.

#160 Form Man on 12.06.11 at 6:49 pm

oh dear, I must have really touched a sore spot with westernman. he has resorted to profanity. I wonder what it was that set him off ?
perhaps the realization that the majority of commenters here firmly agree with me was the final straw.
perhaps the long time without a mate, and the sad fact that there may never be one………
perhaps he has once again cast his memory back to his childhood and the unspeakable hurt that he endured in silence, only to end up a bitter,angry, msogynistic denier.
get help westernman, for the sake of all who have had the misfortune to encounter you……..

#161 Mr. Lahey on 12.06.11 at 6:50 pm

#153 Westernman

“Mr. Lahey, Ammo&Viagra is right about the Massey ferguson part but I’ll be bringing a 6280 to the party which should be more than enough ooomph to bury Form Man…”

Glad to hear you are confident Westernman and once again I thank you for accepting this challenge. Ricky will call you when he is within a hour of your farm. I promise you Ricky will safely haul your 6280 to Sunnyvale where it will await you for your competition. Your may want to give Ricky a warm thermos of coffee to keep him awake on this return trip and make sure he is heading east (check his GPS please, the poor soul only has a Grade 10 education). Your plane ticket will be mailed out to the addressed you indicated. Thanks again Westernman.

#162 Mr. Lahey on 12.06.11 at 6:56 pm

#155 Form Man
“Mr. Lahey,
No need for practice. I have the latest gps guidance system on the John Deere 9620 I am bringing ( which will absolutely destroy the MF 6280).”

Well I have to say you are brimming with confidence over this challenge Form Man and I commend your positive outlook. Westernman is also very confident and this should be a real showdown. The inhabitants of the trailer park are looking forward to this contest almost as much as the bearded sage’s address, his debate with Flaherty and the presentation by Disciple. Seems like Smoking Man is a no show as he has not responded (much to the chagrin of Randy and Ricky who really wanted to meet him). In any case your plane ticket has been mailed as well Form Man and I hope after the ploughing contest is complete you can bury the hatchet with Westernman and join Garth and the rest of the blog dogs and the Sunnyvale misfits on our Clydesdale sleigh ride through the Nova Scotian forest.

#163 Timing is Everything on 12.06.11 at 6:58 pm

#155 Ammo & Viagra

Ya but, those leaf blowers are multifunctional…

http://tinyurl.com/cegemao
http://tinyurl.com/bm7llp5
http://tinyurl.com/cf43nl2

#164 Kevin on 12.06.11 at 7:12 pm

Remax is out with their X-Mas puff piece for 2012.
http://www.remax.ca/miscellaneous/REMAX%20Outlook%20Report%202012/REPORT%20REMAX%20Housing%20Market%20Outlook%20Rpt%202012.FNL.pdf

I was a little miffed that they did not use my new debt graph.
http://tinyurl.com/82pcrmg

#165 Kevin on 12.06.11 at 7:13 pm

No doubt has household credit exploded in the past decade.
Remax should have noted this in their report.

Total household debt has exploded by 135% between 2000 to 2010.
Mortgage debt has exploded by 131% between 2000 to 2010.
Consumer debt has exploded by 146% between 2000 to 2010.
This is at a time when the average weekly wage increased by 30%.

#166 kilby on 12.06.11 at 7:20 pm

# 143. Form Man

The OMREB stats for November, what areas did they cover? According to the OMREB realtor site, from Oyama to Peachland inclusive there were 4,053 residential listings and 427 sales for the 30 days of November

#167 Devore on 12.06.11 at 7:24 pm

#1 pathcontrolmonk

The trouble is when house prices are well outpacing inflation and incomes, the property ladder does NOT work. Instead of trading up for nicer house with more equity, move up buyer just end up with a much bigger mortgage. Sure their current house is worth more, but their next house has appreciated even more.

In Canada the property ladder is broken anyways, with stagnating condo prices for years, disappearance of the “starter house”, and runaway prices for family-sized houses.

#168 Susan on 12.06.11 at 7:41 pm

Love your blog Garth. Not only have I learned a lot but I have had a good laugh too!

I was wondering, is it possible to have inflation when real wages are on the decrease? Can we have inflation without wage increases? If so why?

Thanks!

#169 Westernman on 12.06.11 at 7:41 pm

Form Man,
Bullshit? Profanity? You need to get out more if you think thats profane.
I’m not really concerned who agrees with who – you may think your running for a high school popularity contest but I’m not.
As far as Mates go – I have all I want – I’m just not stupid enough to marry them…as you’ll find out someday in divorce court…that rumbling sound you’ll hear will be the bailiff rolling in the scrotum strecher and poof! there’s goes your concrete empire and Ol’ Form Man will be the one one the way to the poorhouse.
Enjoy your alimony and child support payments.

#170 Smoking Man on 12.06.11 at 7:42 pm

#163 Mr. Lahey on 12.06.11 at 6:56 pm

I’ll be staying at the delta barrington next to the casio

#171 Onemorething on 12.06.11 at 7:45 pm

#152 Tony on 12.06.11 at 5:37 pm

Re: #71 Onemorething on 12.06.11 at 6:18 am

You forgot the top for stocks on the first few days of January of 2012. Should get at least a 50 percent pullback and then a sideways to down market for the next 15 years.

More idiocy. — Garth

I’m not sure we are at the top of stocks nor a major pullback in Jan 2012 will occur. I am only thinking of the direction of RE as per G’s Blog.

RE will retrace 50% in some areas, 25% avg. in Canada and likely AUS. This will not occur in a short period but over 10 years starting from the top.

If you looking to sell that was so April-May 2011 but if looking to buy it will be 2015-2017 likely to get exactly what you want about 10% before bottom. Then go long home not house!

Boomers will be selling, jobless already selling, the correction is only natural given affordability based on low rates wont matter – like the USA.

I dont for a second think any plan to prop up US RE prices now will work. The only reason the US is looking for foreign ownership is have them take the last 15% tumble nationwide and have a new tax base so they can help salvage what the middle class cant contribute anymore.

The only play in commodities is to the downside. The only way Canada/Aus can succeed in the future is a strong dollar and weakness in these currencies back to the historical .80 CAD/.75 AUD.

I’m sticking with this and waiting to use my USD denominated liquidity to make my final plays.

If you do sell your RE in Canada, at least start by stuffing it into the USD and then looking immediately for investement options.

I like the preferred shares in banks and some nice one’s may be on offer especially when nobody has funds left to play.

#172 Form Man on 12.06.11 at 7:52 pm

#163 Mr. Lahey

I welcome your commendable efforts as a peace broker between myself and westernman. In a gesture of goodwill toward westernman I propose we do bury the hatchet after I bury him in the contest. Not only will we all be on the sleighride through the Nova Scotian forest, but I propose that westernman and myself ride side by side on the clydes as we lead the sleigh of merrymakers !

#173 Nostradamus Le Mad Vlad on 12.06.11 at 7:56 pm

#124 GregW, Oakville — G’day Greg. Thanks for the links.

I remember all too well when various countries began to shut up shop when mad cow came. Now the shoe is on the other foot, with Japan’s contamiinated beef and whatever still being exported.

The operators of Fukushima are daily still dumping radioactive water into the Pacific — what else can they do with it? Chances are this ain’t over by a longshot. Cheers!

#132 Two-thirds — “But a storm will happen and all of us (prudent and fool alike) are going to get soaked.”

Agreed there will be a storm, and most will get clobbered, but the severity is dependent as to how individuals react to things.

Prudent people didn’t get that way by making rash choices in life, whereas the young ‘uns of today, most of whom didn’t bother to listen to their parents, will feel the effects more.

The main point is how bad will the downturn be? No one is able to predict the future, only take care of themselves. In this respect, to each their own.

#138 Coho — Exc. post, and right on the money.
*
The slow protracted melt we’re currently undergoing reminds me of Airport!, esp. the landing. Still, all things must end one way or the other.

#174 bridgepigeon on 12.06.11 at 8:26 pm

118 Trev16,
You and Garth are both correct. There will be wholesale change if Paul gets in, desperately needed. I too think he’s the only hope currently for the US. The whole system is setting up for: Operation
Iranian
Liberation
which could easily go global and nuclear. He’s the only one who is able to put an end to all the millions being killed, maimed, displaced by the US military, who as you probably know, support his campaign the most (the troops that is). Interesting times are upon us.

RP is a nut. And unelectable, thank goodness. — Garth

#175 Bottoms_Up on 12.06.11 at 8:47 pm

#122 Dorothy on 12.06.11 at 2:31 pm
———————————————-
I don’t know many boomers, but I do know a few.

Of these, most couples (3/4) are likely going to stay in the homes in which they raised their families. The other couple is on the fence.

It’s like they say: ‘you gotta live somewhere’. And what better place to live than the place that you know best (with amenities, roads, neighbours, friends, local schedules that you have always known)?!

A lot of people are afraid of change. And why change if you don’t HAVE to change?

#176 Westernman on 12.06.11 at 9:09 pm

Form Man,
In regards to your reference to ” bury the hatchet” ( you are SO full of cliche’s) I refer you to my last post indexed at position # 170.

#177 Van guy smokin now on 12.06.11 at 9:10 pm

#143 Form Man on 12.06.11 at 4:38 pm
OMREB ( Kelowna )

real estate stats for November 2011 just out

total sales = 258
total listings = 4475
MOI = 17.34

DA’s unmotivated sellers are still sticking with their listings……amazing determination in these folks……

Can you provide a link for these stats? I can’t see what you do from my sources.

#178 Nostradamus Le Mad Vlad on 12.06.11 at 9:13 pm


Simple Chart The truth will set us free! Bank of France debts jump tenfold; Seizing Control with a pen. The pen is mightier than the sword; 4:24 clip Sanctions on Iran hurts the US; Tomato Bubble Never heard of it, but apparently there is one; Norway “The Norwegian Bilderberger Scam” (oil); Greeks emptying bank accounts; Sacrifice Occupy our homes may change this; US Rich See the head; EU Treaty More votes and referendums;
*
Reinventing Canada Get rid of the politicos and lobbyists first; South China Sea Military build-up; US Army OWS seems to have won, if the govt. decides to send in the troops, and Troops vs. OWS, troops on streets in Moscow; 4:31 clip Anti NATO worker returns from Libya; Washington doesn’t seem to have enjoyed Iran’s downing of their spy drone. Iran probably doesn’t like Iran spying on them; Iran Seems Iran is not a threat after all (couldn’t get sound on the clip); 5:05 clip Civil Liberties gutted; Herman Cain supporters move to Ron Paul, and Ron Paul leads Gingrich.

Red Cross bans xmas; BP and Halliburton Passing the buck between friends; Soccer There was a ‘decency’ between the UK and Germany and WW1; Documentary Failed 1934 coup against FDR.

#179 Stinky the Fish on 12.06.11 at 9:19 pm

@Kevin

Exactly right. This bubble has been fueled by debt. How come that is never mentioned in any Remax reports?

#180 Mr. Lahey on 12.06.11 at 9:35 pm

#171 Smoking Man

“I’ll be staying at the delta barrington next to the casino.”

A cheer has gone up throughout Sunnyvale as I announced over the loudspeaker that you will be attending the first annual Sunnyvale Trailer Park Greater Fool Blog Dog Christmas Party. Ricky and Randy have been wanting to meet you for some time so this will be a real treat. See you in Sunnyvale Smoking Man!

#181 Mr. Lahey on 12.06.11 at 9:40 pm

#173 Form Man

“Not only will we all be on the sleighride through the Nova Scotian forest, but I propose that westernman and myself ride side by side on the clydes as we lead the sleigh of merrymakers.”

Now that’s the spirit of the season Form Man! You and Westernman can absolutely lead the Clydes through the forest whilst the bearded sage waxes eloquent on the housing bubble and why the shithawks will not attack. Flaherty said if government matters are not too pressing he will also jump on one of the sleighs and join the blog dog Christmas revelers. A merry time will indeed be had this Yuletide season in Sunnyvale!

#182 Smoking Man on 12.06.11 at 9:43 pm

RP is a nut. And unelectable, thank goodness. — Garth

Insperation for my next post

#183 eaglebay - Parksville on 12.06.11 at 9:45 pm

#142 disciple on 12.06.11 at 4:38 pm

The first post that I agree with you.
I guess you’re not that plugged up.
Go Canada Go. Let’s get to work. Of course we can do it.

#184 Trev16 on 12.06.11 at 9:52 pm

RP is a nut. And unelectable, thank goodness. — Garth

Garth,

Perhaps you should actually look into his record and what he stands for than just doing the typical mainstream media spin.

Ron Paul is the only candidate that stands for something different than all of the other candidates including Obama who have been compromised by special interests.

Ron Paul has a record which no other politician can touch in terms of not flip flopping and not being bought off by special interests (Wall Street, etc).

If the Republican voters actually educated themselves on Ron Paul…… rather than listening to sound bites from mainstream media telling them what to think….Ron Paul would have a real chance. He is already polling ahead of Obama when it comes to a head to head race.

He has been proven right over the last 10 years and his prediction of this financial mess not ending well is 100% accurate……he actually downplays it because he does not want to scare Americans to how bad it really will be.

For my American friends and family……I sure hope he gets in so he can turn this sinking ship around before all hell breaks loose.

Garth I know you don’t want to admit to Fema Camps but here is the latest as they are starting to staff them:

http://www.infowars.com/exclusive-government-activating-fema-camps-across-u-s/

It’s all good.

Cheers,

Trev16

You and RP deserve each other. — Garth

#185 DonDWest on 12.06.11 at 10:01 pm

“As global demand inches higher and commodities gain, our economy will benefit disproportionately.”

Does this mean silver will shoot back up to over 100$ an oz?

No. — Garth

#186 Devore on 12.06.11 at 10:02 pm

#169 Susan

I was wondering, is it possible to have inflation when real wages are on the decrease? Can we have inflation without wage increases? If so why?

Wage increases above rate of inflation imply a rising standard of living. What makes you believe that is economic destiny?

It is very possible for inflation to be above rate of income growth, or for incomes to even be negative nominally. This signifies a lowering standard of living, which many economists believe we are likely to see in the future, as the world overall moves towards income parity: some people will see decreased standard of living, while majority will see increases and become more affluent. Chinese, South Americans, Africans will become wealthier, westerners will become a little poorer. It is physically impossible for everyone in the world to live like we do.

#187 comfortably numb on 12.06.11 at 10:05 pm

Form Man

Seems to me another reason for the dying Okanagan market is the lack of Alberta buyers. For years they were buying up the Okanagan and are now either buying the US or have no money to spend. Also, when I was with the government you needed years of seniority to get a transfer to the OK…now many OK jobs get posted externally because no one wants to more up there anymore.
Just my two bits….

#188 robert james on 12.06.11 at 11:27 pm

You will find the November numbers here for the Okanagan.. The Central Okanagan would be Kelowna. http://www.omreb.com/files/11%20-%20CO%20Statistics%20November%202011.pdf

#189 Rick on 12.06.11 at 11:43 pm

Ron Paul in no nut. US would not of had a housing bubble if they listened to Ron Paul.

The Amazingly Accurate Predictions of Ron Paul

Doesn’t Ron Paul advocate a return to the grammar standard? — Garth

#190 Rick on 12.07.11 at 7:36 am

“Doesn’t Ron Paul advocate a return to the grammar standard? — Garth”

Why did you replace my link to the video “The Amazingly Accurate Predictions of Ron Paul ” with that comment? I don’t mind the comment but I REALLY don’t like that the link was removed.

Old news. Been posted previously and if RP wants to use this site, tell him to buy an ad (which I don’t allow). Besides, he’s a nut. — Garth