First, of course, I must apologize to the guns-God-&-gold crowd for my comments yesterday. I had no idea they’d precipitate a global sell-off, dropping bullion 3.5% and crashing silver 7%. But at least there was some good news for the knuckle-dragging, metal-licking Tea Party wannabes with word idol Ron Paul has jumped into second spot in the US Republican nomination race. He’ll lose, of course.

Second, I wrote about precious metals yesterday more to comment on human nature than the asset class. An army of metalheads with their shorts in a twist proved me right. Gold and real estate are the most emotional of assets, which makes them intensely prone to bubbles and busts. Now more than ever.

So, third, events of this week up the odds that housing sales and prices are set to decline. Are you ready?

We’re in the middle of one giant, sucking, deleveraging. Drew knows it:

I have a townhouse in Vancouver and have been trying to sell it since March. I have yet to get any bites.  I admit to being one of those that believed the banks, and fell for the housing dream. I hope it is not too late and someone will buy my townhouse (fingers crossed) as I know see that I am way over my head. My monthly payments are high enough as it is, when rates go up I’ll simply be unable to afford my home. I can’t wait to get out. My question is, do you know any ways to fight paying penalties to the bank? By the time I pay commissions and penalty I will be losing money, something I will happily do rather than hold on and get burnt later when the bubble bursts.

Deleveraging is economist talk for what Drew’s doing. The poor guy’s desperately attempting to reduce his debt by dumping real estate, even knowing he’ll end up losing. This is the mirror opposite of what he did when he bought – which was leveraging up his downpayment with a mess of cheap bank borrowing.

This deleveraging is what’s pushed the US economy into stagnation. Savings are up in America now, and debt is down. Just the opposite of Canada. Deleveraging also goes by the name of austerity, which is what governments are doing in Britain, Spain, France, Greece and Italy. Less spending, often combined with tax hikes, is designed to cut deficits and end excess. It also knocks the crap out of growth, inflation and real estate values.

This week brainy Bay Street economists slashed their estimates for growth next year, for Canada and the world. Meanwhile the Bank of Canada has turned up the volume on its campaign against borrowing. We now have more household debt than the Yanks or Brits. The ratio of debt to personal income has hit a new high of 153%. Says Brother Carney: “Our greatest domestic risk relates to household finances.”

And did you hear about Ed Clark? The CEO of TD Bank is urging F to crop mortgages once again, banning 30-year amortizations and returning to a max of 25 years. Yeah, just like 1966, when people used to get horny for each other instead of bungalows. How quaint.

Then we have swampy financial markets, the collapse in commodity values and the global flight to safety, goosing the US dollar and bond prices. All of this is screaming the same message. Yup. Deleveraging. Which brings more deflation than inflation. Less spending. Restraint. Wearing socks to bed.

As I mentioned yesterday, this is a fundamental reason precious metals are so done. It’s why, as over-leveraged real estate investors like Drew understand how screwed they are carrying heaps of debt, listings will swell and sales won’t. Emotion, hormones and duct tape can sustain markets for a long time, but there’s no defeating economics. As the economy inexorably slows, more people will realize the extreme risk HGTV, Global television and all the banks walked them into. After all, buying a house with 7% down when interest rates are at an all-time low only makes sense if real estate values will rise. If they don’t, then rent. If they fall, disaster.

So keep an open mind. It’s a rare thing here.

Referrals are the Core of my Business from Swinn on Vimeo.


#1 Jimbo on 12.14.11 at 9:35 pm

Garth how confident are you that interest rates will increase in 2012?

#2 First Place on 12.14.11 at 9:36 pm


#3 Josef on 12.14.11 at 9:37 pm

First !!! Oh Yeah Baby!!!

#4 Onemorething on 12.14.11 at 9:38 pm

Two words for Drew “DUMP IT!”

Take the loss as a lesson before you’re enslaved to that debt for a decade – OUCH!

Oh yeah, one positive from doing this is a clear conscience and clear direction going forward. You’ll find renting a blast and may I suggest a short term 1 year rental as rents will be coming down as well.

#5 Spiltbongwater on 12.14.11 at 9:40 pm

When you mentioned Ed Clark I thought of Dick Clark. Only a couple more weeks until he is wheeled onto the stage to give us something to celebrate into the new year.

#6 Victor on 12.14.11 at 9:48 pm

And did you hear about Ed Clark? The CEO of TD Bank is urging F to crop mortgages once again, banning 30-year amortizations and returning to a max of 25 years. Yeah, just like 1966, when people used to get horny for each other instead of bungalows. How quaint.

Tis true, here is the link:

Garth, do you think F will listen and change mortgage rules next year?

#7 Van guy blazin kush on 12.14.11 at 9:48 pm


Drop the price on the townhome before you lose more. I got out of mine and lost money. I’d lose more if I sold today. You’re losing money everyday!!! There are still greater fools right now but they’re slowly fading. Get the f$&@ out now!

#8 LJ on 12.14.11 at 9:50 pm

Leverage Kills.

#9 oslec on 12.14.11 at 9:52 pm

There’s nothing wrong with wearing socks to bed. My house is too cold because i can’t afford to heat it all night!!

#10 jess on 12.14.11 at 9:53 pm

The extractors

With roughly $450bn still owed by the bank only 65b. to disperse (Lehman) 14cents on the dollar…..

9 volumes

Monday 12 December 2011
by: Richard D. Wolff, The Guardian UK | News Analysis

#11 604 on 12.14.11 at 9:54 pm

Great information Garth- for me who knew little about the economy and finances, I am so glad I was able to learn about this blog. It has saved me from making a financial mess- or at least made my life much less stressful in terms of avoiding a heap of debt- like a lot of my friends.
I have to say though most people have chosen to ignore the information and have made some poor choices- so even if the writing is on the wall AND the same situation happened in one of the most powerful countries in the world people still believed that “its different here”.

#12 Smoking Man on 12.14.11 at 9:54 pm

Garth said
I must apologize to the guns-God-&-gold crowd for my comments yesterday. I had no idea they’d precipitate a global sell-off, dropping bullion 3.5% and crashing silver 7%.

Just a bit of glee in that one. Must be the holidays….

Ron Paul’s odd’s have surged with vegas bookies. Did ya make your bet yet…….

#13 WI Boomer on 12.14.11 at 9:55 pm

REAMN-MAXX!!! Just what the world needs is a doper-broker in RE. Enough stupid people on the North American continent, seems that those north of 49 have been even sillier of late. Always time to get your fat butts to safety, but you might get your checks singed at this late date!!
Garth has been saying the incredibly obvious for years, but many must have believed, “It is different HERE”

Yeah, we have a word for that. The word is Bullshit.

Go forth, wise ones sell that ticky-tacky box, before the foreclosure pappers arrive. Your southern neighbors have seen this flick

#14 MarcFromOttawa on 12.14.11 at 9:57 pm


#15 Stinky the Fish on 12.14.11 at 9:57 pm

Here’s the real estate porn you’re talking about

18,000 sqr ft gets most women horny

#16 Smoking Man on 12.14.11 at 9:57 pm

Drew might be on to something, remember earlier this year when my son and I sold our invetment condos.

Well I got top dollar in July since then same unit selling for 9% less.

Talk about luck………..

Bearded one… you might be onto something….

#17 Harlee on 12.14.11 at 10:00 pm

Ha ha ha…What a great video of Smoking Man – and in colour too !

#18 Midas on 12.14.11 at 10:04 pm

Keep up the good work, Garth. I hope the yellow metal drops another hundred or two.

#19 phinny on 12.14.11 at 10:05 pm

Condo Chris is awesome. He really is. And he works for ReMax- wow, that’s just great.


And Remax gets quoted in the news about every second day. Yuppers. Even the FP quotes Remax, ad nauseum.

Scary, Canada. Scary.

#20 mike smith on 12.14.11 at 10:08 pm

There can be down turns in secular bull markets. From 1966 – about 1982 there was a bull market in commodities , but stocks and the economy went nowhere. The US is keeping rates low by printing money(buy there own bonds) I have researched about peak oil and agriculture and given supply crunches on the way I find it hard to believe in deflation in the long run. Gold and silver in particular had big corrections in the 1970’s before going much higher. Asset price deflation(houses) yes,but in general inflation. That’s my 2 cents anyway! Enjoy your blog BTW

#21 The Real Jimbo on 12.14.11 at 10:09 pm

“As I mentioned yesterday, this is a fundamental reason precious metals are so done.”

Well, you certainly choose to ignore history. The great deflationary and deleveraging periods that started in 1720, 1772, 1825, 1873, and 1929 resulted in fear of counterparty risk. Investors asked, “I hold a bond, cash in the bank, or treasuries, but will my counterparties be insolvent and unable to pay me back?”

So investors looked for liquid assets with no counterparty risk… and turned to gold bullion. Gold stocks also did extremely well in these periods as their margins increased dramatically.

If all you anti-gold people are so sure gold is going to crash, why don’t you sell yours? Oh yeah. You don’t have any and missed out on 10 years of a bull market. Maybe that’s the real reason why you are so anti-gold.

Modern deflation is lethal to commodities. As for my own portfolio, I certainly hold PMs and have for decades, in the weighting recommended in several of my books. Spend more time on research and less on criticism. You’ll be better for it. — Garth

#22 Pr on 12.14.11 at 10:10 pm

Now I know where Real estate is going!

#23 martin9999 on 12.14.11 at 10:21 pm

‘As I mentioned yesterday, this is a fundamental reason precious metals are so done’

garth you have been saying that gold is done for a long time. i am not a bull in gold but lets face it gold and oil are not the only one that were down today. same thing you said many months ago in august when gold dropped in the same way. i think you are calling the shots to soon as you have been calling it in real estate. as you say gold its a sentimental asset and because of it i see it well above 2000-2200 to be considered real trouble. in real estate you have been saying the same thing for over 3 years and speculators have made a killing out there. i tell you men you are wayyyyyyy ahead of the game.

#24 X on 12.14.11 at 10:22 pm

I can’t see Carney doing anything until at least mid 2012, the economy sucks….although I do agree that rates need to go up.

Same w F, I can’t see him making any mortgage changes until at least the end of the spring sales…..again, I would completely agree with limiting mortgages to 25 years.

#25 Seven Stars and Orion on 12.14.11 at 10:30 pm

Condo investment aside, the question remains, what IS the meaning of pa rum pum pum pum?

#26 Mel on 12.14.11 at 10:42 pm

Drew does not have to worry. I just read my home paper here in the West Coast, and was told that CMHC is predicting a ‘ balanced’ market in 2012. As a matter of fact, in some areas prices will go up.

Reason you ask, low inventory. These people are in king size bed with our Banks, Bank of Canada Governor, and the rest….

As I have said yesterday, I have no interest listening to the ‘experts’. They think that all of us are stupid. Well, some of us are not!

#27 Uh Oh Canada on 12.14.11 at 10:49 pm

Garth- you didn’t answer Drew’s question. If he doesn’t sell, is foreclosure the answer? Great post by the way.

I will deal with bad-day scenarios shortly. — Garth

#28 wtf????? on 12.14.11 at 10:51 pm

Theres no ‘deleveraging’ for retired civil servants. I saw an ad in the Bangkok Post the other day from an investment firm advertising to expat civil servants with ( get this) pensions of more than $100,000 per year !!!!!!!

Multiply this by the hundreds of thousands of civil servants fanning out around the globe to live in elegance on these outrageous pensions while Canadians shiver in the dark. How many billions are flushed down the crapper ?

Like I said ..real estate talk is just misdirection while the rats are running away with the cheese.

And yes…be happy if your bond fund went sideways or up 2%…….just don’t look at real inflation numbers for consumables and taxation running hot at 20% ++++. Like I said….even cash is losing value in this market.

Hey did I mention opportunity cost? You could be laying in the sun instead of giving the CDN government your money…….or are you just dumb? Happy to cut a cheque for 2 mill to the gov who gives it away to civil servants in paradise while you work? Thats just idiotic.

#29 ss on 12.14.11 at 10:52 pm

Do you have a price for gold that would signify a buy to add 5% to your portfolio?

#30 Van guy blazin kush on 12.14.11 at 10:55 pm

Richmond home sells, finally.

4686 bonavista dr listed in the spring at 1.2. After 4 price reductions, sells for 790k. Owner bought in 2003 for 390k. If you list your home now in Richmond, you might be too late already.

#31 Mr. Lee on 12.14.11 at 10:56 pm

Silver to Gold ratio: 17 to 1. Silver is 17 times more abundant in the Earth’s crust than gold. At $35 an OZ for silver, gold should retail at about $600 and OZ. So either gold is over valued or silver is under valued. You decide, never the less real estate is over valued as we Canadians are about to discover..

Have fun folks.

#32 The Dividend Yield Investor on 12.14.11 at 10:56 pm

As an american here in the North Georgia Appalachia (U.S.A) of the lower suburbs of Canada; I would like to go one step further and have mortgages at a maximum of 15 years with a required 20% down payment. It simply amazes me that when it comes to real estate it is always up, up and away in price. However, when the price of consumer goods go up, right along with peoples arms in indignation.

It has always been my contention that the American dream [I can’t speak for Canadians] is for real estate to be of ever increasing quality and with CONSTANTLY LOWER OF PRICES.

Mr. Turner you certainly know your markets.

Best Wishes,
The Dividend Yield Investor

#33 T.O. Bubble Boy on 12.14.11 at 11:00 pm

Can’t wait for the Flaherty “I’m Prudent!” press releases if/when he does make further restrictions on mortgages…

I’d put the odds on him mentioning his 2006 championing of the 0-down/40-yr mortgage programs at about 1,000,000-to-1.

#34 thewhitenight on 12.14.11 at 11:07 pm

Ha hah! Saskatchewan has more than the Roughriders and uranium(those americans are making some pretty nifty nukes, can’t wait to see one up close.) We’ve got potash!!! Poh-tash. Its pink. Tastes like salt. Good for explosives. Apparently there will be more mines in this province than people to staff them. Dump all your properties you fools! Sask is the future. Nuclear isotopes and pink salty stuff. Need I say more?

#35 Scott in Gibsons on 12.14.11 at 11:07 pm

It’s pretty easy to call a falling gold price as the price of gold falls. Well done Garth. All of the reasons for its rise to current levels are still in play. It won’t fade until the worlds economic problems have been resolved. A few weeks of volatility means nothing.

What I don’t understand Garth is how you can be such a critical thinker when it comes to real estate but can’t be bothered to look beyond the mainstream media when it comes to other issues like Ron Paul and the Tea Party. Whenever a politician or movement comes along that advocates lawful ethical behaviour, they are vilified in the MSM. We are all exposed to this day and night and don’t need to hear you parrot it. The reason people come to this “pathetic blog” is to hear a different point of view. If you have the time, do some research on Ron Paul, the Tea Party, FEMA camps, etc; and then comment on them. We don’t need to hear more corporate propaganda mis-information.

Start here; its from the MSM so it won’t be too crazy for you. The US Government can now imprison anyone for reasons only they know, indefinately. Or is this just more crazy conspiracy theory? More to come…..

RP is a whack. There are no FEMA camps. The Tea Party is an economic joke. — Garth

#36 Doug in Victoria on 12.14.11 at 11:08 pm

#25 Seven Stars and Orion

LOL, brilliant question, but I don’t have the answer…

#37 45north on 12.14.11 at 11:08 pm

By the time I pay commissions and penalty I will be losing money, something I will happily do rather than hold on and get burnt later when the bubble bursts.

in the US, 2006 the housing market started to soften, sellers didn’t, they dug in – they said “after the Super Bowl, in the spring” whatever. By the time they realized the market had moved on, it was too late. They had big mortgages, they was a price below which they couldn’t sell.

#38 timmy on 12.14.11 at 11:13 pm

““Of all the pre-budget consultation processes I’ve participated in – and there’s a lot of them over the years – this one was the most disrespectful of Parliament and disrespectful of the witnesses and their organizations in terms of ignoring the legitimate opinions of a lot of Canadians who took the time to meet with us,” Mr. Brison said.

From this government? What a surprise!

#39 a prairie dawg on 12.14.11 at 11:19 pm

#25 Seven Stars and Orion

The song vocalizes the sound of drumming. (badly) lol

#40 By any Means on 12.14.11 at 11:27 pm

In keeping with the theme of the week on Global there seems to be nothing but good things on the horizon for Etown.
It is almost like an infomercial…..would love to hear some comments.

#41 a prairie dawg on 12.14.11 at 11:31 pm

Forgot to add, that the song those lyrics came from is the classic holiday tune, “The Little Drummer Boy”

If it was written in modern times, the kid would have had a drumming app on his iPod. lol

#42 Harold Svenson on 12.14.11 at 11:36 pm

Drew said “I have a townhouse in Vancouver and have been trying to sell it since March. I have yet to get any bites.”

Anything will sell for a price. Obviously the price must be wrong in this instance.

#43 renters rule on 12.14.11 at 11:45 pm

Watched a fascinating housing market juxtaposition last night on the house porn channel. That chatty cathy property virgins realtor woman was taking a Toronto area mid-twenties kid through her paces, as the virgin decided she needed to buy a house in the mid $300s, which would require one of her 2 house-hunting posse to rent the basement of, so that she could afford the payments. Episode ended with chatty cathy scolding said debutante about taking too long to decide on writing a contract (2 weeks in this case) because she would always be left behind by better and faster bids. Girl was shell-shocked and appeared to have been left in tears by the whole experience.

Second of the back to back chatty cathy episodes had a young doctor, currently living in his sister’s basement, looking to buy a house in the neighbourhood he grew up in. Turns out, he could not afford (his determination) what he wanted, in the neighbourhood he wanted, Chatty cathy was of course SHOCKED. But I have shown you completely reno’d granite and stainless dipped palaces in “similar” hoods in your price range, how can you not JUMP?! He went back to his sister’s basement.

Next up: 2 tales from south of the border. :-o One a short sale deal made by a young couple in Baton Rouge (bought a barely finished 3,000 sq ft spec house valued previously at $435K for $285K), the second a very very sad story about a mid-30s texas guy who bought a house to impress the live in (at the time) girlfriend. They didn’t say which happened first, but the recession reduced his income by 80% and the girlfriend dumped him (you do the math).

He was out of money so couldn’t keep current, so had to sell his place to keep the bank from taking it. Could not get a deal done for the money he needed to get out of it and which still would have left him $10,000 in the hole. The realtor (a divorced woman who apparently had experienced her own tough times in the past) actually tearfully waived her entire commission and got the buying agent to accept a flat $1,000 commission to try and get the deal done…. but the deal ended up falling through, and the guy was forceclosed and facing what seemed to be an ominously uncertain future.

Really, really something to watch all that back to back (dates on all programs were listed as 2011). We are in for a massive shitstorm up here………

#44 Paolo on 12.14.11 at 11:46 pm

Train wreck has begun.

Condo Chris? You know everyone has lost their way!

#45 Herb on 12.15.11 at 12:01 am

Barn, meet door.

#46 Smoking Man on 12.15.11 at 12:02 am

Lisa Laflem in the back ground, wife watching news

Somking Man on u tube Crazy dimonds


#47 Barry in Pickering on 12.15.11 at 12:04 am

Hi Garth,
It appears that you censored my last post (which was just stating YTD returns of major asset classes). Why?

Never saw it. — Garth

#48 Smoking Man on 12.15.11 at 12:08 am

Wasted again…………

World is fd…………………………………….

Our masr=sters thinging how to keep heads attached. me I’m on a far away planet with floydians……thinkinging if there is a god his name is rodger waters…….

That chick that got shot in the head giffods….

When she came out of coma she could not put a sentince together, but she could sing…..

different part of brain…………….

Smoking man guru math code risk shit……but fs up spelling his own name…….the brain…..nature//

pretty cool

#49 toroo on 12.15.11 at 12:10 am

Garth are you for real ? Reading your blog taught me one thing . Do the opposite of what you say i wonder how many people you screwed up by convincing them that the housing was a bubble . Know they can never afford a home in gta and all the money they threw out the window by paying rent and when it comes to gold open your eyes gold is the only thing that keeps going up .. STOP RUINING THE INNOCENT FOLKS !

See what I mean? — Garth

#50 Smoking Man on 12.15.11 at 12:12 am

Breath in the air dont be afraid to care……..

wow……………….sample off missisuaga home groen with a bot of 1.5 litter chile white……………………

Im breating the air…………not caring

dont leave me……

couse your own ground


night night

#51 Smoking Man on 12.15.11 at 12:16 am

Real este god just told me me 416 is protected

what the fk,,,,

#52 Smoking Man on 12.15.11 at 12:17 am

Garth wy do u alow my stuoid shittt to get through

Please censor Me when I get like this, I have fans damb it

#53 Canadian Watchdog on 12.15.11 at 12:19 am

Oh yes Mr. Clark…We know why you’d want stricter mortgage lending rules.

Unfortunately for Mr. Clark, The NY Fed doesn’t seem to like TD’s primary dealer application and intention to repo all those soon to be toxic mortgage backed securities onto the Feds balance sheet (through TD Securities NY branch).

TD will be the first to fall.

#54 City Slicker on 12.15.11 at 12:40 am

I didn’t have time to post anything on the gold debate. But Garth forgets some important points about gold.

During reactions in gold, the degree of gold and gold share holders pessimism is EPIC and without cause.
Why Gold?

1. Gold is a currency.
2. Gold is competitive to paper currency.
3. Gold is not a commodity
4. Gold is a barometer of fear.
5. Gold is a barometer of confidence in government.
6. Gold is insurance.
7. Gold is insurance against government gone mad.
8. Insurance is not something you trade.
9. Gold is the financial high ground when global debt problems exist.
10. Gold in your hand eliminates all counter party risk.
11. Every single currency is paper backed by nothing.
Stay the course. Nothing is solved, nor will it be.
Gold will be violent. Gold is nowhere near fully priced.

These aren’t my points, but those of…..THE LEGENDARY JIM SINCLAIR – Gold Guru.

Long and strong on the yellow metal. Peace.

This debate is over for a few days. However, gold will only be currency when I can exchange it for bike gas. Which will be never. — Garth

#55 HolyCow on 12.15.11 at 12:49 am

“7% down”?

People were buying for a couple of years with zero percent down:

“Canadian banks were giving out zero-down, 40 year mortgages to people who were one paycheque away from insolvency. These were Canada’s version of subprime mortgages. These seemed like a conundrum on the surface. Canadian banks are very conservative and risk-averse. Why would they give out so much money to such risky borrowers? I asked TD this question. TD explained that they were not taking any risk. Canadians are, through CMHC, which is owned by the government. CMHC insures these risky mortgages. If the borrower defaults, taxpayers would be on the hook. The banks do not take the risk, but get the reward. CMHC is Canada’s version of Fannie Mae and Freddie Mac. MacLean’s magazine now says the same thing in their article called “The CMHC: Canada’s mortgage monster”.”

Now, they are putting 5% or less down.

#56 disciple on 12.15.11 at 12:49 am

#25…SS&O… pa rum pum pum pum is derived from the much earlier fee fie fo fum, has influenced heavily the wonderful Carribean la-la-la-lum and has recently given birth in Nippon to i-chi-bum.

#57 Humpty Dumpty on 12.15.11 at 12:52 am

Spend more time on research and less on criticism. You’ll be better for it. — Garth.

Proverbs 7 – 10

He who corrects a scoffer gets himself abuse, and he who reproves a wicked man incurs injury. Do not reprove a scoffer, or he will hate you; reprove a wise man, and he will love you. Give instruction to a wise man, and he will be still wiser; teach a righteous man and he will increase in learning.

Be careful where you hop G….

Can you hear the noise? It is not a train headed down the track. It is not Superman flying through the air faster than the speed of sound. It is a printing press, running hard toward ruin.

#58 chubster on 12.15.11 at 1:04 am

laissez faire deleveraging without backstops means whole govts and the banking system going down hard. the political will for that does not exist. there will be money printing until they can’t before that happens.

#59 BPOE on 12.15.11 at 1:12 am

This is an important read from the Wall Street whiz kid.
Like I’ve been saying for along time Vancouver and gold are for the long term. Remember Gartman has one of THEE WORST track records on gold. I agree on Garth’s point on gold only making a portion of your portfolio for Conservative investors. For gold bugs go ALL IN!!! Great tax loss seeling opportunities this year
In almost three decades in and around Wall Street, I’ve never seen such widespread distaste and outright hatred of an investment that for almost a decade has greatly outperformed just about every other investment vehicle:

Use a link. — Garth

#60 BPOE on 12.15.11 at 1:15 am

Garth, here’s your chance to make a cool mill just get your name on the list. Grandich offering Gartman, Christian and Nadler a million dollar payout
I will wager any one of them (or a combination of all three) one million dollars U.S. that gold will hit $2000 before it hits $1,000 on the COMEX. I have arranged for the law firm of Lomurro, Davison, Eastman & Munoz of Freehold, New Jersey to hold the funds in trust. For once, let one or all of the most arrogant and often wrong gold forecasters truly put their money where their mouth is when it comes to gold forecasting. This offer shall be good until midnight, December 31, 2011 (I will donate my winnings to charities).

#61 Nostradamus Le Mad Vlad on 12.15.11 at 1:27 am

“Deleveraging. It’s a rare thing here.” — Kinda sums everything up in a nutshell!

Suggest Drew drop the price by 100K, sell it and run like hell.
Thomas Cook UK travel agents closing 200 branches, and Lloyds as well, which leads to Jobless rate at 17-year high; David Cameron has also got this right; High Oil Prices TPTB are bringing on one obstacle almost every day; MF Global Conspiracy theory; 12:06 clip Banxters are destroying the Euro and the US$.

Risk Assets, 2011 Year End Review; BRICs and Eurozone Clash of the titans; Lower the Euro and everything’s ship-shape; Saudi production puzzle; Blame Someone has to be the fall guy; Titanic; China sinking; Not MPFC Hungarian-English Sketch; 2012 – 15 Oil bull market; EU banks could crash system; Fish ‘n’ Chips Teach a man to fish.
Ron Paul may be in better shape all around; Wasp / Bee stings Different effects; Passed Indefinite detention bill; US – China A love – hate relationship; USDA and Monsanto Partners in crime; 30 miles Russian carrier off Scottish coast; Pyramid Last door to be opened in 2012; Haunting Vision Post-tsunami Japan, and Big Wave off Ireland.

0:33 clip Martial law ad; Electric Sun answers longstanding puzzles; Canada and Kyoto A better look; Slouching Coming US war with Iran, but Iran could make the Straits of Hormuz difficult to pass; Earth Changes ‘Quakes are rising; Alien Invasion Independence Day again.

#62 Expat on 12.15.11 at 1:27 am

Well articulated discussion on deleveraging on Yahoo Finance, nice summary of what Garth has been expressing, although from a US viewpoint. Commodities downturn discussed can’t help but affect us.

#63 DML on 12.15.11 at 1:27 am

Realtors fudging numbers.I’m shocked,shocked!

#64 Aussie Roy on 12.15.11 at 1:35 am

Aussie Update

Prices are falling but are still too expensive

Perth (WAs capital – our largest mining state) house prices have fallen at nearly four times the national rate, according to the latest Market Facts report by the Real Estate Institute of Australia.

Houses in the Western Australian capital have declined 6.3% over the September quarter to be down 8.2% over the past 12 months, with the median sales price declining $40,000 from $490,000 to $450,000 from September 2010 to September 2011.

So not even the worlds largest deposit of Iron ore and 4th largest reserves of nat gas could save the house bubble.

31% of properties forced into sale

Close to a third of all properties coming onto the market over the last two months were from forced sales, a LandMark White sales index has revealed.

Still not over in many places in the USA.

NEW YORK (CNNMoney) — If you thought the U.S. housing market couldn’t get much worse, think again.

Far fewer homes have been sold over the past five years than previously estimated, the National Association of Realtors said Tuesday.

NAR said it plans to downwardly revise sales of previously-owned homes going back to 2007 during the release of its next existing home sales report on Dec. 21.

NAR’s existing home sales numbers, released monthly, are a closely followed gauge of the health of the housing market.

While NAR hasn’t revealed exactly how big the revision to home sales will be, the agency’s chief economist Lawrence Yun said the decrease will be “meaningful.”

#65 Michelle on 12.15.11 at 1:48 am

Well, if my RRSP investments don’t grow enough in the next 5 to 10 years then I may have to deleverage some of my other assets:

It’s nice to have a backup plan for my retirement :)

#66 Jeff in Victoria on 12.15.11 at 1:50 am

So Mr Carney is concerned about Canadians’ rising debt to income ratio at 153%, what on earth would one expect to happen by keeping interest rates so low for so long, it is like offering people cheap crack cocaine and then wonder why so many people are addicted.

I was curious how one arrives at ‘debt to income’ ratio, lots of websites explain it quite thoroughly, this one excerpt gives a person real pause for thought

“If your debt to income ratio is higher than forty percent you are in danger of being unable to pay your bills if you were to incur more debt”

Not sure what can be expected from having 153% other as Garth says, “this does not look like it is going to end well”

#67 Trev16 on 12.15.11 at 1:51 am


You sure had good timing yesterday calling the end of the bubble in gold. Of course I disagree with you on that (gold bubble) as you and I both know the financial world is imploding. I listened to a good interview today with Max Keiser who explained why gold was down so much. Interesting as Max points out that it is tied to the MF bankruptcy. He also points out that in the states ( I’m not sure about Canada) that derivatives get settled first before you can access your trading/bank accounts. Apparently the rules changed in 2000. This should be of importance to investors who think their money is safe.

Part 1

Part 2

Part 3



#68 nonplused on 12.15.11 at 1:51 am

I think the gold crash today had more to do with fallout from the still not MSM worthy collapse of MF Global. As hundreds of thousands of traders, investors, hedgers, and other market participants just discovered, counterparty risk does matter. Gerald Celente is rumoured to have lost $10,000,000 that he had posted as margin on gold contracts, not because the price of gold went down, but because MF Global did. Folks, these were custodial accounts, and the money just disappeared.

The collapse of Lehman Brothers was coincident with the last time gold broke it’s 200 day moving average, and a long slug of bad news then followed for all markets (except bonds). We also got TARP, TALF, the Fannie and Freddie bailouts, the nationalization of the auto industry, and every other crock you can think of. Expect more of the same squared.

Anyway, reading one day below a 200 day moving average does not a bear market make. The 50 day has to cross below the 200 to incite true panic, which it may. But the last time that happened in 2008 it was also a false signal.

I think Gartman might be reading the charts wrong too. Its true gold has not been able to break the high, but that high was silly. It rocketed up like $200 in 2 months! It had to be corrected. I would say it almost looked as if someone was “painting the charts”, but it was probably just irrational exuberance. In any case use the trend channel if you want to use charts, and ignore the $1900 high when you draw your trend (it doesn’t fit anyway, you draw the trend from the lows). The channel is still ok.

That said, I run with higher gearing than Garth’s 5%, but 10% pushing and 20% is speculative. Gold may or may not trade as money in the future, but who cares? It’s an asset not a lifestyle. Stay diversified as Garth suggests.

#69 lookoutbelow on 12.15.11 at 1:58 am

Says Brother Carney: “Our greatest domestic risk relates to household finances.”

So Mr. Carney, exactly who are the two people that got us into this predicament. That’s right, you and Mr. F. Now Brother Carney is ringing the bell on Canadians having become “Champions of Household Debt!”

Haven’t we seen this movie before in the You Nice States in 2008-Present. Exactly what did he expect with “rock bottom interest rates” and 30 year amortizations.

The crash in housing is not going to look too good to all those “wise” people who chose Mr. Carney to lead the newly created “Financial Stability Board”. Well we taxpayers should be able to bail out the CMHC when all those High Ratio Mortgages begin to feel the pressure of pending higher interest rates and that uncomfortable loss of jobs for the last two months. No job = no mortgage = loss of confidence = crash!

#70 Jane on 12.15.11 at 2:07 am

As overheard in a bank lineup yesterday in Van: offer way less than asking. The place we just got was listed 6 months ago at $449. They relisted at $399, we offered $359. They countered with $388 and we got it at $377.

A colleague is trying to move here from Parksville for work, but can’t sell her house so is having to commute from there to Van every week.

Slowly things are changing.

#71 wtf????? on 12.15.11 at 2:12 am

BTW…..heres a thought

Money printing is running hot at 29%….eeeehhaaaaa….we’re all gonna die

A couple of things have become clear in my thinking over the past day, or so. There are two numbers floating about for the price of gold which are fairly important. One is the $1,600 level. This is the level below which, if gold were to keep on sinking, might spell the end (at least for a very short while) of gold’s decline. There’s nothing magical about it…just a sense of things based on looking at charts.

The second number is $1,425 – another chart number – but one I have heard by an acquaintance who used to be in the gold refining business.

Now suppose – just suppose – that the PTB are aware of such numbers, but also let’s suppose that they can read in the most recent Federal Reserve Money Stocks report that M1 is going up at an annualized rate of 29.2 percent for the most recent three-month snapshot.

Wouldn’t it be an interesting opportunity to buy up gold just before it goes to a kind of a moonshot in 2012 and beyond, as it recaptures pricing due to printing up all the paper being bandied about these days?

But that leaves us with a little problem: Where would the money come from?

Enter the missing money from MFG? Maybe run through offshore dark pools? Say, this gets to be a really juicy line of inquiry.

So much so that I’ve developed a little Boolean truth table that reads:

If gold drops under $1,500 then rises sharply, MFG missing money will be found.

If gold stabilizes here, MFG money will remain missing, having been spent on a gold bet.

Looks to me like a “Heads I win, tails you lose” kind of set up, doesn’t it?

#72 TheRealTruth on 12.15.11 at 2:16 am

Can a 60 year old buy a house with 5% down/30 year Amort?

Can a 60 year old buy a house with 21% down/30 year Amort? Who insures the mortgage in case of death due to old age?

#73 Crash Callaway on 12.15.11 at 2:21 am

What could be worse than being a realtor with an I.Q. of six?

Having to share it with your conjoined twin smoking man.

#74 bridgepigeon on 12.15.11 at 2:29 am

It’s not just the tea party wannabees that are interested in Ron Paul. We are following the US in more than just real estate trends. Stephen is deluded into thinking Ohbombya is his buddy. The superpower has no friends, only interests. What’s being legislated across the lake now is indefinite detentions, no legal representation, plus even nonsense like not being able to grow or transport your own vegetables. As they lose all their rights and freedoms, we’re next. A lot of people are fed up with the right vs. left distractions and really want change. Who else is there that isn’t corporate owned?

#75 Blog Dog Carney on 12.15.11 at 2:34 am

Mr L – Perhaps these young people can “sing” at the FASTPGDBDCP!

#76 YR on 12.15.11 at 2:59 am

From your comments, I couldnot understand if you like or dislike Ron Paul’s vision and economic principles. You both being well principled, I am bit curious to know your opinion on Ron Paul….thanks,

#77 new-era on 12.15.11 at 3:01 am

My take on what TD is saying is

– Carney is going to be chicken shit to raise the rates
because it going to crush an already weak economy.
so no rate increase

– So if you can’t raise rates at least you can stop the real estate spec from driving the debt higher.

– This is a scary indicator of actually how weak our economy is. And how unstable the real estate market really is. If a simple raise in interest rates can break the camels back.

Think of our exposure the fail.
1. Raise in mortgage rates
2. Inflation can trigger a raise
3. People will continue buying our debt a the ultra low rates
4.Also if the banks are sounding the alarm, it means they are seeing defon 2 but are only saying we are at defcon 4 (from defcon 5)

#78 Corban on 12.15.11 at 3:47 am

The comments section was garbage yesterday, but I wonder if it wasn’t a prophylactic for you garth, you were out in force! You should stop feeding the PM trolls, it’s too easy.

#79 Jane24 on 12.15.11 at 3:54 am


There is always a buyer at the right price. Find that right price and get rid of it now. The so-called Spring market may not exist next year. You just need to sleep well in life.

get shot for whatever you can.

#80 Jody on 12.15.11 at 6:10 am

Please say why you hate Ron Paul so much? What has he ever done to get you knickers in such a knot Garth? Are you afraid of him for some reason? I mean really, the guy is the ONE politician is DC who isn’t a lying sack of utter shite and you get all pissy about him, why? What great calamity will happen if he happens to win? Personally I think he’s the one person who would really try to turn around the economic situation in the US, mainly by closing the 200 plus military bases the US has overseas and by ending the constant line up of wars the Yanks seem to be getting involved in. I would like to think that’s a good thing. The man has more integrity than all other politicians put together and you get all prissy and pissy about him, wow, I think that’s rather sad. And for your information, most of his supporters are not gold and gun bugs, those morons worship the bought and paid for whore named Michelle Bachman. Ron Paul supporters come from both the so called fictional right and left, conspriacy nuts, average mothers and average fathers, people who are sick and tired of the lying garbage they always get to vote for. An honest man comes along and you have an aneurysm.

I don’t hate him. He’s just, luckily, irrelevant. — Garth

#81 Mr. Lahey on 12.15.11 at 6:18 am

Good morning blog dogs. We are a mere 48 hours away from the FASTPGFBDCParty and it is quite the treat to have breakfast with the all knowing, all wise, all understanding mystic reader of financial tea leaves and bearded oracle, the former right honourable Garth Turner. We are going over yesterday`s battle royale with all the gold lovers on the blog. Ron Paul was up all night trying to make Ricky understand the gold standard but poor Grade 10 dropout Ricky now thinks there are standard transmission Fiat cars with gold stick shifts! The Clydesdales have been fed and hitched to the wagons for our picking up of Mark Carney in Halifax. We have loaded the pooper scooper for his act of contrition. The bearded oracle who writes this blog is in fine spirits and gave the misfits in the park a sample of his Scottish tartan jig dance last night in the mess hall. Barb joined him for a rousing jig and it brought the house down. Captain Garth has informed everyone in the park that he is going to let Bubbles answer some of the blogger posts today under the pseudonym of Garth. He won`t say which and you bloggers won`t know! Only 48 hours until the FASTPGFBDCParty begins!

#82 Dragonslayer on 12.15.11 at 7:04 am

Anti gold sentiment is what you want to see as an investor in PM. It makes up that “wall of worry” that gold will keep climbing. So recent price dips represent an excellent buying opportunity.
And I know the backers of PM have laid out the reasons ad nauseum on this site to support it so I will only add that 5,000 years of history prove that when times are hard people go back to gold. And Europe and the US are so screwed that times are about to get hard.
Do agree with Garth though in that it should only be only a small percentage of your overall portfolio. Better to look it as an insurance policy in case things do go south.

#83 R2D2 on 12.15.11 at 7:16 am

Dyshlexycs Untie!

#84 Montrealer on 12.15.11 at 7:42 am

condo Chris’ website is ridiculous! I thought it was a joke, but the guy’s real! With a dozen videos all more ridiculous than each other.

#85 NOBODY on 12.15.11 at 7:42 am

Condo Chris, a few years ago, was on “Man Tracker”.
That guy was fat, out of shape and he was bad mouthing man Tracker on how great he was & that he wouldn’t get caught.
Of course he got caught, did really bad, he couldn’t run, climb, etc. But his big mouth was in a terrific shape!

#86 Devil's Advocate on 12.15.11 at 8:21 am


You may not like his method of delivery but if you review his videos this guy is telling it like it is.

But then as I’ve always believed of the blog dog, pups, poodles and hounds – “You can’t handle the truth”

#87 Luc on 12.15.11 at 8:23 am

I don’t understand the debt ratio to income stat.

Does the 153% mean that on average if someone makes $100 he spends $253 dollars? If so some people are in deep trouble!

Also what % is real estate mortgage debt?

It means the average Canadian who earns $50,000 has debts 153% higher. This includes mortgage debt, but because it is an average number, the typical debt of homeowners is vastly higher than those of renters. Also remember because this is an average, you double it for a couple, regardless if only one person is employed. — Garth

#88 Kevin on 12.15.11 at 9:02 am

To answer Drew’s question:

“My question is, do you know any ways to fight paying penalties to the bank?”

The only real tool he has is to make use of any prepayment allowance he has available to him. If he makes a big lump-sum payment, it reduces the principal amount against which any early-payoff penalty is calculated. He can even do this with borrowed money (line of credit, a family member, whatever), then pay it back right after the mortgage is settled, although that requires that there be equity in the home.

#89 Mr. Lahey on 12.15.11 at 9:16 am

#75 Blog Dog Carney

“Mr L – Perhaps these young people can “sing” at the FASTPGDBDCP”

Alas, these should have been suggested weeks ago Mark. We are less than 48 hours away from the FASTPGFBDCParty and there is no room for last minute additions. Please get them for next’s years bash. The bearded oracle, mystic reader of financial tea leaves, sagacious debunker of all the gold standard lovers, the former right honourable parliamentarian and national minister of revenue for the Queen’s land of Canada, Captain Garth Turner has just finished his breakfast and is having a preparatory debate with the eye patched Ron Paul. The whole park is listening to them as I type. I just overheard Garth say, “listen Ronnie you are never going to win the Republican nomination and as for your return to a gold standard well Ricky has a better chance of getting past Grade 10 than that ever happening”. Bubbles is rolling on the ground laughing at the retorts of the bearded oracle that runs this blog. Folks we are less than 48 hours away from the start of the FASTPGFBDCParty so get yourselves over to Sunnyvale because the fun has already started!! We leave for Halifax to pick up Carney in 20 minutes. Randy has the Cyldesdales all hitched up and the pooper scooper ready to do duty.

#90 jess on 12.15.11 at 9:42 am

The inquiries began almost two years ago when a group of whistle-blowers made up of plaintiffs’ lawyers and Harry M. Markopolos

Markopolos reveals the multitude of other cases he’s working on, some of which involve health care fraud (he says the health care industry “makes Wall Street look honest
U.S. and New York Sue Bank of New York Mellon Over Foreign Exchange Fees
Published: October 4, 2011

#91 Kevin on 12.15.11 at 9:45 am

Drew wrote:

“I will be losing money, something I will happily do rather than hold on and get burnt later when the bubble bursts.”

Drew, I’m sorry to tell you, but the bubble is already bursting. You’re selling for a loss. That’s precisely what a “bubble bursting” looks like. If you wanted to get out before the bubble burst, you should have sold a long time ago. You’re in the thick of it now. You can still minimize the damage, but don’t kid yourself into thinking you’re getting out before any kind of bubble bursting.

In 2001, I sold a bunch of Nortel stock for $23/share. I bought it for over $100/share. It later went to $0. Did I get out before the “bubble burst?” Of course not. Selling at $120 would have been getting out before the “bubble burst.” Same thing here, my friend.

#92 Waterloo Resident on 12.15.11 at 9:49 am

I like RON PAUL, I don’t know why, but I trust him. I feel that he’s a loony, but I know that the won’t lie and cheat and steal the way the other politicians will, so if I was an American I would vote for him 100% of the way, and try to avoid the lying scum that the other politicians are these days.

Simplistic solutions are usually exactly that. — Garth

#93 fancy_pants on 12.15.11 at 9:50 am

#89 Mr. Lahey on 12.15.11 at 9:16 am

Remember, don’t let Ollie see the logo on the side of the float when he pulls it… being an ostrich and he may panic.

Please keep Ollie away from the former goldman-sach’s golden boy, he gets very nervous around criminals. Oh, and of course, holiday greetings to all the misfits.

#94 Daisy Mae on 12.15.11 at 9:56 am

“The CEO of TD Bank is urging F to crop mortgages once again, banning 30-year amortizations and returning to a max of 25 years…”


No kidding?! If the arrogant, stupid and incompetent Conservative government had just listened to YOU a few years ago and resisted tampering with mortgage amortizations and interest rates we wouldn’t be in this damn mess!

F would rather eat bugs than listen to me. — Garth

#95 Bewildered on 12.15.11 at 10:03 am

I can’t believe the what junk sells for in the GTA

check the link below MLS sold listings.

#96 Daisy Mae on 12.15.11 at 10:12 am

VICTOR: “Garth, do you think F will listen and change mortgage rules next year?”


And, admit he was wrong tampering with them in the first place? This will be interesting….

#97 Daisy Mae on 12.15.11 at 10:17 am

“F would rather eat bugs than listen to me. — Garth”


PRIDE will get in the way? His pride comes before the wellbeing of the country? I wouldn’t be at all surprised.

#98 disciple on 12.15.11 at 10:31 am

#54 Canadian Watchdog… I agree with you… Now, which of the remaining financial institutions do you recommend people store their cash accounts?

#99 Daisy Mae on 12.15.11 at 10:31 am

T.O. Bubble Boy on 12.14.11 at 11:00 pm
Can’t wait for the Flaherty “I’m Prudent!” press releases if/when he does make further restrictions on mortgages…

I’d put the odds on him mentioning his 2006 championing of the 0-down/40-yr mortgage programs at about 1,000,000-to-1.


You’re right — he’ll gloss it over. I’d love to see that little twerp eat crow.

#100 jamaican_gal on 12.15.11 at 10:33 am

Garth, you devil you! Thanks for posting that video of “Condo Chris”….:) All of a sudden I feel like a plate of ackee and saltfish with some sorrel to wash it down, while listening to Bob Marley wailing in the background.

Is that really Smoking Man? We gotta link, iyah…:)

One love!!

#101 Junius on 12.15.11 at 10:36 am

It is different here. Vancouver does not need to worry about deleveraging. We have a new buyers program brought to you by “BPOE and The Professionals”.

The new program is called, “Canadian relax, Asians pay” or “CRAP” for short. Just leverage yourself up on gold and housing and let the CRAP do its thing. No work, no worry.

Politicians love CRAP as well. Says Finance Minister Jim Flaherty, “We love this program. We will keep stimulating it until we are completely filled with CRAP”.

New BC Premier Christie Clark say, “we want to get right behind our residents so we can give them the CRAP they deserve.”

But wait. That is not all. Act today and you can purchase gold bars stamped with “I won at the Apocalpsye Game” at hugely inflated prices. These bars will serve as a reminder of how much smarter you are then everyone else and how much CRAP you can take.

But that is not

#102 City Slicker on 12.15.11 at 10:37 am

I remember when things got crazy in Calgary with RE, house prices were going up $500/day.
Can’t wait to see the reverse of that, as panic ensues.

#103 Junius on 12.15.11 at 10:39 am

#94 Daisy Mae,

We wouldn’t be in this mess and the Cons would not have a majority government. Their decision was all about power.

#104 Daisy Mae on 12.15.11 at 10:51 am


“The stated purpose of FEMA is to “reduce the loss of life and property and protect the Nation from all hazards, including natural disasters, acts of terrorism, and other man-made disasters, by leading and supporting the nation in a risk-based, comprehensive emergency management system of preparedness, protection, response, recovery, and mitigation.”


What does this have to do with imprisonment and conspiracy?

#105 Daisy Mae on 12.15.11 at 10:57 am

SCOTT IN GIBSONS: “The government can now imprison anyone…”


FEMA doesn’t have anything to do with imprisonment or conspiracy.

“The stated purpose of FEMA is to “reduce the loss of life and property and protect the Nation from all hazards, including natural disasters, acts of terrorism, and other man-made disasters, by leading and supporting the nation in a risk-based, comprehensive emergency management system of preparedness, protection, response, recovery, and mitigation.”

#106 Junius on 12.15.11 at 11:01 am

Looks like BPOE and the Professionals are going to have their hands full in China. Apparently it is not different there either as Real Estate prices crumble.

“In truth, China faces an epic deleveraging hangover, like the rest of us.”

#107 eaglebay - Parksville on 12.15.11 at 11:06 am

#70 Jane on 12.15.11 at 2:07 am

Tell your colleague to price it right and give me a call.

#108 Junius on 12.15.11 at 11:06 am

#54 Canadian Watchdog,

Thanks for posting this. It should serve as a reminder to people that Canadian banks are only in better shape because of Canadian regulations. Many of them have US arms that are just as bad if not worse than many of the US banks.

Again, they were not more prudent. They are better regulated.

#109 not 1st on 12.15.11 at 11:10 am

Why is it so hard for the posters to understand why Garth hates Ron Paul? Its because in Garths world everything is all A-OK in the U.S. and there is no need for Ron Paul. Just elect another cookie cutter dem or rep and let her fly. Salute the flag, set up some more bases, cut the wall street regs, off shore the jobs, run the debt up, bail out insolvency and hammer the middle class sheep.

Anyone who thinks those fools south of us are going to usher in the next economic revolution might as well go to vegas and put her all on black.

Don’t hate any politician. But Tea Party economics poses a massive threat to global recovery. A win by Ron Paul or his ilk would usher in many dark years. — Garth

#110 Usuk on 12.15.11 at 11:13 am

#2 First Place on 12.14.11 at 9:36 pm

#3 Josef on 12.14.11 at 9:37 pm
First !!! Oh Yeah Baby!!!


BWAHAHAHAHA you both suck so bad.. I wish I was so simply amused that being the first poster made my day. Instead, I have to resort to ridiculing the losers that care about their post standing so much. Oh well.


#111 RL on 12.15.11 at 11:18 am

I wonder if F and C have a link to this Web Site on their computer and if they do are they “clenching” right now?

#112 Daisy Mae on 12.15.11 at 11:23 am

92.WATERLOO RESIDENT: “….so if I was an American I would vote for him 100% of the way, and try to avoid the lying scum that the other politicians are these days.”


Yeah, but you state he’s a ‘loony’. A loony running the country isn’t a good thing, either….

#113 RL on 12.15.11 at 11:23 am

A Web Site here in Victoria is reporting it has been uncovered that Real Estate Firms in the US may be double counting sales so the sales numbers reported may be even worse than reported.

That could never happen here in Canada…

#114 Daisy Mae on 12.15.11 at 11:33 am

Junius on 12.15.11 at 10:39 am
#94 Daisy Mae,

“We wouldn’t be in this mess and the Cons would not have a majority government. Their decision was all about power.”


Some ‘majority’ — 38% is nothing to be proud of.

#115 Blog Dog Carney on 12.15.11 at 11:37 am

67 Jeff – the two ratios are not comparable

69 lookout – I dont set mortgage regs. I do wish Canadians could control their spending. I bet they all own cars that will go 160 kph too. Doesnt mean that they should.

#116 City Slicker on 12.15.11 at 11:44 am

The gold bull will be back with a vengence.

Garth needs to repent and return to God.

#117 eaglebay - Parksville on 12.15.11 at 11:46 am

The majority of the people here blamed the government for the RE situation and the mortgage extravaguance that has accured. The people want the government to change the rules. It’s all government and more government. Nobody makes their own decisions.

I personally never used CMHC. Wrote my own deals.
Wether 20% or 50% down and 10 or 40 years amortization. Made my own conditions and paid a fair interest rates with always an easy short term way out.

It’s the people that must decide for themselves and do what’s right for their financial situations.
The government sure didn’t help but it’s the people that signs the contracts.
Emotions and financial illiteracy rule.
It doesn’t matter if the government changes the rules or not. People, pay attention and be informed.
Don’t give your financial responsibilities and well being to the government.
It wouldn’t matter wether the government is conservative, liberal or NDP. They’re all socialists to different degrees.

#118 blase on 12.15.11 at 11:46 am

People who keep calling Ron Paul “looney”, isn’t it looney to keep choosing leaders who just keep perpetuating the same failed policies?

#119 Long gold on 12.15.11 at 11:48 am

during all that panic selling yesterday of gold and gold stock, some idiots were buying, who were they??? They are called the banksters, not the banks themselves, but the elite banking families. While the worlds richest “idiots” were sopping up anthing gold and gold releated, they also loaned money to the fundsters and leveraged morons to SHORT GOLD and gold stock– dont you see the game being played!!, the banksters are going to fry their clients who are piling into paper and gold shorts, while the banksters accumulate more and more gold ounces/shares…the fools are only focused on the fiat currency price of gold-which is irrelevant!!!!!- get that through your thick skull garth- its ounces that matter in this crisis, not couloured credit coupons that pretend to be money.

And like real estate, this game is not decided in a few days of trading, these scams take place over years, decades, and centuries. gold always wins…it has a perfect record–including yesterday.

#120 Kevin on 12.15.11 at 11:59 am

Garth wrote:

“A win by Ron Paul or his ilk would usher in many dark years.”

You’re right, but a lot of people believe that we need that short-term pain in order to return to long-term prosperity. All these bailouts, TARP programs, barrel-bottom interest rates, and quantitative easing are just postponing the inevitable and dragging this ugly mess out far longer than it should be. This all started 4 years ago. If we’d simply bitten the bullet, allowed people/corporations/banks/automakers to experience the full consequences of their profligacy, then sure it would have hurt, but it’d be history by now. Instead, we have politicians desperate to look like they’re “doing something”, and rampant moral hazard as formerly honest folks seriously consider “strategically defaulting” on their homes in droves, because the consequences have been removed and spread among all taxpayers.

I’m not saying I agree, I’m just saying there’s a nontrivial subset of society who strongly believes we should just get the pain overwith in one fell swoop, and move on.

#121 PG on 12.15.11 at 12:00 pm

Ron Paul is a whack job. His platform states that he will achieve a balanced budget by eliminating 5 cabinet departments (including education) and stopping foreign aid. It is the kind of mentality that we should be ashamed of. It would be nice if we stopped thinking about ourselves all the time and started voting for what would make our country and the world better.

#122 Sue on 12.15.11 at 12:01 pm

I’m a little confused about this ratio as well. I thought that 153% of 50K would be 76, 500…or does it mean 153% higher than 50K in which case you would add 76,500 to 50K? It’s been 20 yrs since Pharmacy school and I better get this straight before I go to work tomorrow…

#123 Sky on 12.15.11 at 12:01 pm

@ # 97 – fancy_pants

Stunningly bad math !

Please, Garth, do your readers a service and consider doing a post on how to calculate basic percentages. It is obvious many are utterly lost and wandering naked, parched and delusional in the desert of Mathland.

#124 Kilby on 12.15.11 at 12:04 pm

#28. WTF.
Very few civil servants would ever see a $100K pension. A good friend of mine has just retired after 28 years as a Director with the Province Of BC. He has a master’s degree in his area of expertise. He has a good government pension and clears $3,200 per month or $38,400 per year. I think possibly MLA’s, MP’s and very few high senior civil servants would ever see that kind of money.

#125 Realitybytes on 12.15.11 at 12:08 pm

Sorry, none of the debt ratio math mentioned here works. Tell me what I’m missing…. but here’s how I see it…

100% of 50K is 50K.
Wouldn’t a debt to income ratio of 153% be income times 1.53? (50,000 * 1.53 = 76,500)

to get 126,500 you have to multiply by 2.53, and that’s not how I was taught ratios. You are assuming a starting point of 1:1 ratio and adding 153% to that.

#126 Kevin on 12.15.11 at 12:09 pm

The numbers still don’t make sense to me. If I have an income of $50,000, and a debt/income ratio of 100%, then doesn’t that mean I have debt equal to my income? That is, I have $50,000 in debt?

Thus, doesn’t it follow that a 153% debt/income ratio means my debts exceed my income by 53%? So my total debt would be $76,500, right?

How the heck did you get $153,000? Or even fancy_pants’ $126,500?

A somewhat meaningless waste of time. Most people have more debt than they can repay. The consequences are obvious. — Garth

#127 Bottoms_Up on 12.15.11 at 12:12 pm

With global and Canadian deleveraging comes realtor hurt and pain.

Thus we need new names.

ReMax will now be ‘ReMaxed’

Royal LePage will now be ‘Le Royal Pain’

Century21 will now be ’20th Century’

Property Guys will now be ‘Poverty Guys’

Grapevine will now be ‘Sour Grapes’

MLS will stand for ‘multiple losers service’

‘The Greaterfool’ will refer to sellers with sticky prices.

#128 Ret on 12.15.11 at 12:12 pm

100% of $100 is $100.
153% of $100 is $153.
I wonder what 153% of $50 is?

Now add the zeros to find 153% of $50,000 class.

Time for recess Grade 6.

#129 Stevenson on 12.15.11 at 12:14 pm

RE prices are NOT decreasing. Not full steam s head but still obvious growth.

But of course you guys will find an excuse to make yourselves feeling better paying rent.

Btw carney warns but after this many years? By the time he’s gone he will still be playing both sides of the game. This is an unrestricted RE market. Those who can’t afford or unwilling to take risk move to low demand areas. Your rent may not cover someone’s mortgage, but hey I don’t think that’s not what they are ultimately after.

#130 Mr. Lahey on 12.15.11 at 12:29 pm

#93 Fancy Pants

“Remember, don’t let Ollie see the logo on the side of the float when he pulls it… being an ostrich and he may panic.”

Fancy Pants, poor ol Ollie, recipient of Ricky’s coffee throwing incident is going to be riding on the float, not pulling it! That’s why we have our sturdy Clydesdales! We are on our way back to the park from te airport with Carney. He seems suitably nervous and the bearded, all knowing, all wise, mystic sage from the east that runs this blog, former parliamentarian and minister of national revenues and debunker of all gold huggers, Captain Garth Turner is blistering him with real zingers as we trot back to Sunnyvale in the Clydesdale pulled wagons. Carney has been given the pooper scooper and has had to use it twice already!! Bubbles almost fell out of the cart as he watched Carney scooping Clydesdale poop!! I fear for Carney’s safety as about 100 blog dogs have arrived in the park. Ricky still can’t grasp the gold standard and he thinks we should adopt an aluminum standard because there is more aluminum in the world than gold and in Ricky’s words, “I don’t see why we can’t just substitute aluminum for gold. Same shit as far as I can see and I only have my grade 10”. Anyhoots folks all is going well for the FASTPGFBDCParty. Keep on coming in blog dogs!

#131 City Slicker on 12.15.11 at 12:31 pm

You’re going to love this one:

“Data on sales of previously owned U.S. homes from 2007 through October this year will be revised down next week because of double counting, indicating a much weaker housing market than previously thought.”

#132 Ret on 12.15.11 at 12:39 pm

My computer time is now 11:38 am. as I post this. The last blog post was at 12:19 pm.

Is Hamilton in the wrong time zone? I thought so.

#133 disciple on 12.15.11 at 12:39 pm

#127… Expression of ratios depend on the original comparison, what are you using as the original starting point? A lot of people on here who criticize others’ math don’t realize that math is a language and every language has conventions, but not all agree on those conventions. I teach my kids that if you cannot translate those numbers into plain English, then you don’t understand what you’re calculating, and neither will anyone else.

#134 Canadian Watchdog on 12.15.11 at 12:40 pm

#99 disciple

That would depend on how active you are in regards to allocating your savings and your trust in the system. A bank holiday is highly unlikely for the time being.

#135 Trev16 on 12.15.11 at 12:41 pm


It’s nice to see that many of the comments are positive for Ron Paul. He is the only hope for the US. If any other politician gets in next November…..there will be absolutely no change despite their rhetoric as they are backed by the usual corporate interests……more debt, more corruption,more wars.

I see also yesterday Obama signed off on detention of Americans without a trial. Isn’t that nice……one day we will wake up and read that people that believe in gold as money will be considered a domestic terrorist. As a result off you go to the FEMA camps without a trial. It’s all good. Can you say……….Germany?

I know you are in denial of Fema camps despite the overwhelming evidence, but that’s OK. For people who want to be enlightened there is mountain of info online.

Also do you think you will be able to do a blog on derivatives? I heard yesterday there are more than 750 trillion outstanding derivatives. That is more than the worlds GDP. What happens when they go belly up?
Do the private Central Banks print or do they confiscate your pensions, etc?



I will devote a column to tin foil futures. — Garth

#136 realestatemob on 12.15.11 at 12:44 pm

I thought this whole drop in gold prices was gold investors taking profits before the year end so that they can invest elsewhere (bonds, stocks, etc).

I don’t think that this commodity is done. I think ppl just want their profits so they can add more stuff to their xmas list!

#137 God on 12.15.11 at 12:47 pm

Good morning , Smoking Man

this is your creator talking..I get back quick, eh?
well you know, I’m god after all.
anyhoo, I read your concerns last evening, and it troubled me, my son.
First of all, you can give me a piece of your mind anytime. I have an open door policy.
Those conditions that you mentioned, ie dyslexia, learning disabil, well, I didn’t “give” them to you. You also said that you adapted to those conditions..and you’re stronger because of that, right?
I gave you free will to do as you wish. There is also such a thing as Nature. It’s something those dummies that wrote the “good book”, sort of left out. They didn’t want to acknowledge it. They also were not listening to me. They just wanted to put their own little biased opinion in there and then label it as my work. I was mad as hell for along time, but I think I’m over it now.

My point is that nature also had a big hand in how you turned out as well as your own street smarts as it were.
I have a lot of faith in you, my son. Don’t get frustrated and keep trying to help others.

Now if you don’t mind, I have a lunch date with Mother Nature, and she gets really pissed if I’m late !
(ps, I will try to convince her to be not so cruel)

#138 disciple on 12.15.11 at 12:48 pm

#132 Stevenson… I don’t rent because I can’t afford the mortgage. and I suspect the same for many others on this blog who rent. There are various other reasons, so kindly refrain from constantly erecting that false logic. Thanks.

#139 Form Man on 12.15.11 at 12:57 pm

#119 eagle bay

You miss the point. If CMHC is going to use taxpayers money to insure mortgages, then I as a taxpayer want some rules. If people are going to take risks with their own money, that is fine by me. If they are going to take risks with my money, that is something different. What I don’t like seeing is private sector losses transferred to taxpayers via CMHC, which is undoubtedly going to happen.

#140 on 12.15.11 at 1:00 pm

#123 PG re RP position on Education dept… In the US, Education is supposed to be a state responsibility, not federal. RP’s position is right on that one.

Read the history and notice how the dept’s role expanded over time:

This creeping centrism is typical of the US federal government. The RP phenomenon is a backlash against expansion into unmandated areas. Education is but one example. It is important to understand where RP and the like are coming from to make sense of it.

For the record I live in a state with no income or sales tax. The public schools my kids go to are funded by local taxes, and from my point of view are just fine.

#141 Ammo & Viagra on 12.15.11 at 1:00 pm

I guess Mr.L’s party will settle this whole Ron Paul thing….or not.

#142 chubster on 12.15.11 at 1:01 pm

i really like this blog because it’s trying to help and it’s quite entertaining. very respectfully, i’d like to point out that it appears to hold a couple of irreconcilable views and i think this is due to misplaced optimism. deleveraging is not the dominant feature of today’s economic, financial and political landscape. instead, this is people, govts, social institutions living beyond their means, unwilling to accept the consequences of what has already passed, and deal with them in the present – so as not to make the ultimate outcome worse. it’s why no country for old men is my favorite movie and good therapy. i can see that some households and parts of the private sector (the non-crony parts) have voluntarily corrected their course. however, there is no sign whatsoever of anyone else that matters acting responsibly. s&l, ltcm, dotcom, 2008 – each time the solution is kick the can, buy time, delay the outcome. why would eurozone sovereign debts blowing up be any different? if they can’t get it together to print euros (and that was what corzine was betting on), the emu will break up and they’ll just each print in their own currencies. the us is in no better shape but it can print so liquidity is not an issue. and this is why usd can be a temporary port in the storm. still, the us cannot evade a reckoning with solvency. for those who believe the pms have topped out, it means a belief in voluntarily confronting the consequences of the accumulated recklessness now. Somewhat perversely for this blog, it means someone like ron paul getting elected – because he’s the only one that has putting a stop to bernanke on his platform. paraphrasing a bit of recent commentary from kyle bass, the pms are not only the object of pessimists, they are also the refuge of realists.

#143 Bill Gable on 12.15.11 at 1:01 pm

Quick anecdote – retailers must be having a fit – crickets in many stores at one of the big Malls. The Apple store was busy, but boy, the other stores were wastelands.
There are going to be sale prices that we haven’t seen in along time.
Car dealer near me is one of Canada’s best known. I walk by a couple of times a week.
Empty and full of nervous sales people.
The great deleveraging is most evident on Craigslist – boats, ski doos and other toys – pages of people trying to raise cash.
My old Boss – just dumped 22 staff. That’s another trend that makes me skittish – p/t work or minimum wage jobs, can’t support Home prices like this.

It has begun.

Be diversified. Pay attention. Get ready for a rate rise, and get out of debt!

#144 Kevin on 12.15.11 at 1:01 pm

Home sales, prices climb in November

While there is concern that on average, house prices across the country are rising, the bigger concern is that mortgage credit growth is continually outpacing GDP and income growth. Mortgage credit growth is growing at 7.5% year over year in Oct 2011 but at 9.0% from the month before.
The Bank of Canada shows that total household debt stands at $1.579 trillion as of October 2011. Residential mortgage debt stands at $1.095 trillion.

If the housing and credit bubbles are not stopped by either popping on their own will ( which is what Flaherty wants) or more credit curbs( Flaherty does not want to be that guy, but he may have to be), Canada will soon hit a household debt to GDP ratio of over 100%. Canada is now at 94%. At the peak the Americans hit 98%. Now they are deleveraging at 89% and trending lower.

According to the Bank for International Settlements
the household debt to GDP threshold is 84%. Canada is clearly on the wrong side of this number and is slipping farther away. The longer that the bubble continues, the harder the deleveraging process becomes to manage.

#145 Trev16 on 12.15.11 at 1:04 pm

I will devote a column to tin foil futures. — Garth

I look forward to it as I know you won’t take the usual cheap shots at the people that deliver that point of view….but will base the column on facts (H.R. 645).



#146 Ammo & Viagra on 12.15.11 at 1:08 pm

Garth, after reading your post today, I get a sinking feeling that you are probably right about everything. It almost seems like it’s starting to gel.
Austerity is coming, deleveraging is arriving, right on schedule. ( the long slow melt that you have been proclaiming.) It was hard to believe fully a year or two ago, because things still seemed A-ok.
It could have easily gone the other way, if governments didn’t take away the punchbowl. Europe is giving out some punch, but just a taste. then taking it away and let the austerity begin.
But I think Mr.L is correct, you are a tea leaf reading oracle. We are not worthy.

#147 Ammo & Viagra on 12.15.11 at 1:10 pm

Mr. Lahey, can you please use more adjectives/adverbs to describe our fearless leader?

#148 Kip the tower crane operator on 12.15.11 at 1:13 pm

Condos in GTA will not tank in 2012 even if sales stall. The high rise industry is flat out now and it will take all of 2012 just to clear the backlog of presold units.

If it does stall for 2013 I can only say one thing. It’s been a good run, best I’ve ever seen in 36 years of construction.

#149 Ammo & Viagra on 12.15.11 at 1:15 pm

I stopped believing in Santa Claus and the Easter Bunny a long time ago, but I am going to the FASTPGFBDCParty !

#150 Dad on 12.15.11 at 1:24 pm

Wifey doesn’t care about silly things like debt loads, amortization periods, and whatever a….like “down-payment” means. She just like….wants that trip to Hawaii and the granite counter top and if you don’t give it to her….well like….I bet the nights out with the girls will start to increase. Don’t get all….like controlling…you know?

#151 Sky on 12.15.11 at 1:24 pm

Mr. Turner, your reply to Kevin (# 128 ) was a cop out. You called Kevin’s attempt at correcting the fuzzy math of others – “A somewhat meaningless waste of time.” Strange, because your own blog deals in basic math.

Cashiers can’t make change anymore without their electronics spitting out a number and the peoples can’t calculate the deadly consequences of compound interest on their debts.

Personal debt levels are bad enough but they PALE in comparison to the debt that govt has piled onto the backs of its citizens. But how many can calculate per capita debt once you start talking about trillions ? Not many. Just the way govt intended. A population of dumbed down and apathetic citizens provides the necessary swamp that the corrupt and greedy breed in.

For those still lost in the vortex : 150% is just another way of saying – One and a half times as much.

#152 John M on 12.15.11 at 1:26 pm

Folks, before you let anyone tell you PMs are “dead”, I encourage you to do some research. Don’t listen to me. Don’t listen to traditional financial advisors (like Mr. Turner) either.

Go to youtube and watch some of the videos. Why not search “why gold will fall” and “why gold will rise” and make up your own mind?
I think you will quickly find out the smart money knows PMs are just getting started on their ascent to much higher levels, although resting and correcting at the moment.

#153 Daisy Mae on 12.15.11 at 1:29 pm

PG: “Ron Paul is a whack job. His platform states that he will achieve a balanced budget by eliminating 5 cabinet departments (including education) and stopping foreign aid…..”


So this is what Garth means by “simplistic solutions”…

#154 Sky on 12.15.11 at 1:46 pm


When the people can’t pay their personal debts the punishment is called bankrupcy.

When the govt can’t pay its debts the punishment for the civil servants who ran up this debt is called gold-plated pensions.

#155 Alistair McLaughlin on 12.15.11 at 1:46 pm

Flahtety has already tightened mortgage rules twice in the past two years, completely reversing their earlier loosening. I wouldn’t be surprised to see the rules tightened once more. Minimum 10% – even for first time homebuyers – and maximum 25 year amort.

#156 disciple on 12.15.11 at 2:01 pm

Toronto the good. Yuuuuuuup! Even the street people are polite when snubbed. We keep the cold on the outside, far away from our hearts. Never once have I ever been cheated by a fellow Torontonian. If you have faith in others, they will repay in kind. Trust is everything, you lose that, you have lost your humanity. You become a dead person walking. It’s no accident that zombies are prevalent in the entertainment zeitgeist of movies and video games. They want you to think that’s how the world is. But the message really is that this is how your real rulers view YOU. Are you a zombie?

#157 bridgepigeon on 12.15.11 at 2:12 pm

123 pg
Have you looked at US foreign aid? The top three countries of US aid are Israel, Egypt, and Columbia. This isn’t food to Africa, it’s all military. Billions spent annually, given to US weapons manufacturers to oppress people. Trillions of dollars can be saved by eliminating illegal wars, millions of lives spared from these atrocities. This is helping people and ensuring generations of Americans aren’t enslaved to pay for it all.

#158 disciple on 12.15.11 at 2:14 pm

Trev16… you are correct, there are countless “FEMA” camps set up at all major railroad stations and central hubs in North America. But who cares? The real news is that these have always existed. By always, I mean it literally. Since the beginning of cities way back when. Detention centres are the backup protocol when the mass mind control fails. Those “FEMA” camps will simply not ever be needed until the cultural programming fails… at that time, shiny yellow metal won’t help anyone.

You are ALREADY in a prison. The most effective kind. It is invisible, yet its shadow can be discerned through the illumination of a liberated mind.

#159 jess on 12.15.11 at 2:25 pm

“The 27 U.S. multinationals surveyed by the Subcommittee reported holding a total of $538 billion in tax-deferred foreign earnings at the end of FY2010. By comparison, in mid-2011, all U.S. corporations held tax-deferred foreign earnings totaling an estimated $1.4 trillion.

Those tax-deferred foreign earnings are in addition to the overall domestic cash holdings of U.S. corporations, which the Federal Reserve has recently estimated at $2 trillion. “U.S. multinationals, as a whole, have record amounts of domestic and offshore cash,” said Levin. “American companies who say their funds are ‘trapped’ abroad ought to be investing their domestic funds to get the economy rolling, instead of pushing for still more tax breaks.”

New Data Show Corporate Offshore Funds Not “Trapped” Abroad: Nearly Half of So-Called “Offshore” Funds Already in the United States U.S. Senate Permanent Subcommittee on Investigations
Dec 14 – Press Release: New data released today by Sen. Carl Levin, D-Mich., chairman of the U.S. Senate Permanent Subcommittee on Investigations, show that large multinational U.S. corporations with substantial offshore funds have already placed nearly half of those funds in U.S. bank accounts and U.S. investments without paying any U.S. tax on those foreign earnings.

#160 Okanagan Renter on 12.15.11 at 2:36 pm

#143 disciple.

Amen to that brother! Real estate shills like Stevenson love to throw up the red herring that renters can’t afford to buy. I guess it must help them to feel less insecure about their doomed livelihood. Granted, it must be tough to be in a “profession” that commands as much respect as a prostitute or Minister of the Environment.

#161 Victoria on 12.15.11 at 2:42 pm

RE price are not decreasing … okay

We were going to the bank to get our Master Bathroom done (it was ripped apart and the crack addict designer stole $40,000 and is now living on the street bankrupt long story – I won’t bore you with it).

Well our house has already decreased 8 %. We are in Broadmead in Victoria if anyone knows it. We put in an Urbana Kitchen, re-did one bathroom put down hardwood floors etc. etc. Gas Fireplace – Well … the long and the short of it is the bank won’t lend us the money because our home has decreased. This is TD. They will only lend us 1/2 of what we asked for. We can’t sell without a master bathroom and living in the place with 1 bathroom and 4 kids is doable but not fun. I want to sell before we end up under water. Bought the house for $920,000 put in $75,000 and now it is worth $940,000. Mature neighbourhood, Mature trees 1/2 acre. I am sick to my stomach.

#162 fancy_pants on 12.15.11 at 2:48 pm

#109 Junius on 12.15.11 at 11:06 am
Canadian banks are only in better shape because of Canadian regulations.

exactly. Just ask the goldman-sachs golden boy all about deregulation. Guarantee his hands are dirty.

Deregulation essentially caused the financial collapse in 2008. Then to boot they try and sell the mortgage security crap as AAA. They are all crooks. Couple that with absolutely ridiculous bonus payouts. Organized crime really. The White house is in bed with them. They are puppets for the Wall street banksters.

Yet guys like that still have the audacity to wag a finger at personal greed and debt. F* you Carnage. Hell was designed for guys like you.

#163 888realtor on 12.15.11 at 3:10 pm

Again, can this be trustworthy–toronto-house-prices-hit-new-record?bn=1

#164 fancy_pants on 12.15.11 at 3:24 pm

#125 Sky on 12.15.11 at 12:01 pm

hey, I was closer than Garth. He initially had $153k as the answer. See what great persuasion he has – even my math follows him

#165 jess on 12.15.11 at 3:27 pm

Bernie Madoff scandal: tax haven Luxembourg in the frame
Posted by: Nick Shaxson in: Thoughts This searing letter on to Luxembourg Finance Minister Luc Frieden, on behalf of 2,500 ripped-off Madoff investors kind of speaks for itself. Three years on, and:

“none of these institutions has been held accountable to date.”

Note that the defrauded investors have fought battles in courtrooms around the world – but keep getting directed to Luxembourg. And in Luxembourg, the..

#166 triplenet on 12.15.11 at 3:29 pm

Mr. Lahey

Im sure the paparazzi caught Form Man and DA getting on a WestJet flight to NS. I was at YVR this morning and saw Form Man showing DA how to use his construction laser sights and programming for ploughing in a straight line. BPOE was also with them teaching DA how to co-ordinate GPS settings and waypoints. I think Form Man has hired these two as advisors as they know where things have been and where the Formster is going.
I think these 3 are up to something.

#167 TheRealTruth on 12.15.11 at 3:34 pm

Oh…that quote…Sherlock Holmes/Spock

Some of the readers may be wise to remember it the few days before Feb 14, 2012 ;)

#168 Pr on 12.15.11 at 3:35 pm

I had no idea they’d precipitate a global sell-off, dropping bullion 3.5% and crashing silver 7%
– Of all the people that I know, none of them is a seller all of them are buyers. I call that a coordinated crash-manipulation from behind the scene.

Of course. Conspiracy. — Garth

#169 live within your means on 12.15.11 at 3:48 pm

Just dug out a Xmas CD to listen and laugh to in the car. Twisted Radio – I am Santa Claus. Hilarious

#170 Blacksheep on 12.15.11 at 3:51 pm

Jody # 80,

“Please say why you hate Ron Paul so much?”

Jody, This is my respectful opinion.

Garth’s views on real-estate and diversification are well known to all.

Garth comes from and thrives in the current “system”.
He knows it well and as he often reminds us, is doing
just fine.

He tries to pass on his knowledge and insight to the unwashed masses, but do to very different life experiences, view points, collide.

Gold bullion is the anti “system” play, a pure vote of non confidence, if you will.

Ron Paul is the anti “System” spokesmen, believing, radical change needs to take place. (not the Obama kind)

I, like many on this blog, and in the US, according to the latest polls, tend to agree with Ron Paul views.

Long story short, Ron Paul’s or gold’s success are not good for the current “system”.

take care,

#171 poco on 12.15.11 at 3:52 pm

#143 disciple on 12.15.11 at 12:48 pm

#132 Stevenson… I don’t rent because I can’t afford the mortgage. and I suspect the same for many others on this blog who rent. There are various other reasons, so kindly refrain from constantly erecting that false logic. Thanks.

so right — and as long as i keep finding price drops like these –why would anyone in their right mind buy !!!!!

mls 914461–416 Blue mountain Rd–Coq
listed Aug 2011–548k——sold for 475k

mls 920480—1820 Langan Pt Coq.
listed Nov 2011-369.9——sold for 295k

mls 91107—2617 Henry–Pt Moody
listed May 2011 –928k—-sold for 857k
—–and then there’s beautiful only “goes up” Anmore
mls896442—-3460 Bedwell Bay Rd
listed Jan 2011–1.499m—sold for 1.015m

lots like the above –owners seeing the light and wanting out at any cost

#172 Long gold on 12.15.11 at 4:02 pm

Lets look at some snipets of what bank of canada’s, Mark ‘GOLDMAN SACHS” Carney has to say…

-Growth in the Age of Deleveraging- dec 12 201

-As a result of deleveraging, the global economy risks entering a prolonged period of deficient demand. If mishandled, it could lead to debt deflation and disorderly defaults, potentially triggering large transfers of wealth and social unrest.
(another tin foil doomer huh Garth, oh and how do you think this transfer of wealth is going to happen, do you suppose it might be by devaluing the currency that everyone has flocked into, the fiat currency instruments of debt)

-those in the commodity sector can expect relatively elevated prices for some time.
(Thanks Mark for stating the obvious…hard assets rule during the deleveraging of the debt super cycle, and paper is burned to keep warm)

#173 vyw on 12.15.11 at 4:10 pm

Toronto house prices hit new record–toronto-house-prices-hit-new-record?bn=1

Toronto and Vancouver prices may not have topped yet….

#174 D on 12.15.11 at 4:15 pm

Gold is for…. not much and never will be.

-1 to Gold and RE.

There, I said it.

#175 CTO on 12.15.11 at 4:28 pm

Lets put this debt ratio to rest!!! 153% is just a number. A number of the AVERAGE debt of Canadians as a whole. Some have no debt (0%) and some have 400% debt.

The fact is, is this number has been rising substancially in recent years coupled with mortgages. This means that a heck of a lot more Canadians have 400% debt than a few years ago…end of story!

#176 Lookinin on 12.15.11 at 4:29 pm

Not related to this post, but still real estate-related…
I just got this in my Inbox from Don Campbell at R.E.I.N.

Perhaps I should be paying for the same advice that Garth offers us for free? I don’t know, but here is a piece of the sales pitch. Sheesh.

Your Exclusive Opportunity
For One-On-One
Real Estate Coaching

And 20% of the Final Auction Price is Donated
Directly to Habitat For Humanity


Live Auction On NOW – Click Here! So here it is… our first live auction ever, our first offering of one-on-one real estate coaching, and a great opportunity to participate in a little holiday fund raising.

One of the biggest obstacles facing real estate investors is lack of capital to buy your properties… let’s face it, 99.9% of investors simply run out cash. For many this obstacle is debilitating… and it’s a shame because it derails so many potentially great investors at exactly the wrong time.
It continued:

And that’s not all, we’re throwing in powerful bonuses to ensure your success. Here’s everything you get:

A total of six one-on-one coaching calls (3 hours total) with real estate expert, Russell Westcott

One complimentary copy of the REIN™ Joint Venture Secrets Program ($997 value)
etc. etc. Now, does this seem completely out of whack with reality? I mean, c’mon, look at the state of things out there. If someone buys into this speel I worry about their sanity. Too crazy for words.

#177 jess on 12.15.11 at 4:40 pm

BBC News – China protest in Guangdong’s Wukan ‘vanishes from web’
You +1’d this publicly. Undo1 hour ago – China’s internet censors have blocked searches relating to an ongoing protest in the village of Wukan, web users say. Users of Sina Weibo, the

Guangdong: Wukan village under siege, more factories occupied

Submitted by WW4 Report on Thu, 12/15/2011 – 02:50.

Security forces have since Dec. 11 blocked roads leading to the village of Wukan, in China’s Guangdong province, after residents chased out police. Residents have gathered in the center of the village, the scene of a peasant protest movement over a land grab by local officials. They are demanding negotiations with the central government to resolve the dispute. Chinese authorities have again resorted to pre-emptive electronic action, blocking Internet searches for “Wukan.” Users of micro-blogging site Sina Weibo say searches for “Wukan” returns a message reading: “According to relevant law, regulations and policies, search results for Wukan cannot be displayed.”
Security forces have used tear-gas and water cannons in clashes with Wukan protesters, who are armed with bamboo sticks. Several villagers have been detained—some being held incommunicado and without charge; at least one has died in police custody. With the police drive from the town and the roads cut off, the situation is fast escalating after steady of protests since September. (BBC News, BBC News, BBC World Service, Dec. 14)
Villagers say that they have enough supplies to hold out for 10 more days. No food or water is allowed in, and no villagers allowed out. But the villagers remain intransigent. Village leader Chen Liangshu told a reporter, referring to the legendary aggression of the Wukanese and their neighbors: “We have an old saying here. In heaven there is the Thunder God, on earth there is Lufeng and Wukan.” (The Telegraph, Dec. 14)
Industrial actions in Guangdong also continue. On Dec. 3, over 2,000 workers at a Japanese hard-disk factory in Shenzhen began a strike over severance pay. The strikers have staged a sit-in to block the entrance of Hailiang Storage Products Co, a subsidiary of Hitachi, accusing Japanese bosses of bullying Chinese workers. Another issue is Hitachi’s imminent sale of its stake in the Shenzhen subsidiary to US-based Western Digital Corp. The deal fails to stipulate workers’ compensation, and workers fear they will be treated as new employees when the American bosses take over. (China Workers, Dec. 10)
See our last posts on China, the struggle in Guangdong and the politics of cyberspace

#178 VICTORIA TEA PARTY on 12.15.11 at 4:40 pm


There is a special place in Hell for organizations like CREA.

Once again, this conniving group of codswollop purveyors is going back to the “well” so to speak; the well where dwelleth the poor people with marble countertop dreams backed by impoverished-scale rental incomes.

CREA has announced that housing prices are going up just fine and that 2012 will see even grander, higher prices.

Oh, wonderful.

The piffle is borderline criminal, nay psychotic, behaviour. CREA has no idea how much economic damage is caused by such crap.

Every time CREA cranks out the PR bull another poor, stars-in-the-eyes, family loads up on low interest rate debt to “buy” a home they cannot afford with money they don’t got. This action ONLY drives another nail into Canada’s declining economic outlook.

EVERYONE is affected and therefore damaged, because such action pressures the “independent” Bank of Canada to hold off on interest rate hikes. AND it forces chartered banks to hold the line on longer-dated paper hikes.

This results in lower yields for old folks needing retirement income but are afraid to invest in the stock market because of its own psychotic behaviour.

Censorship is dead wrong.

But yelling “fire” in a crowded place will result in a fatal stampede. And that’s what’s still happening in our real estate market.

The real shocker of such CREA BS is the stunning realization that the only viable economic activity we’ve got going here is real estate and related home building/renos and the like.

In other words, as commodity prices also become unhinged, we are dependent on an unstable sector of the service industry that will blow up the second the BoC cranks up rates.

And you say squirrel recipes are so yesterday, Garth? Some of Canada’s new so-called homeowners will be able to afford ONLY the meat from those rats with trails for this Christmas!

May the clappers of Hell rain down upon the dolts at CREA.

#179 live within your means on 12.15.11 at 5:03 pm

F would rather eat bugs than listen to me. — Garth

Too bad he had not eaten one of these.

#180 Victoria on 12.15.11 at 5:08 pm


Could you please post the link to this. I went to send it to TD. They say property is going down. CREA says it is going up. They said our property has gone down since last year even though we did considerable renovations. Someone is not telling the truth and I think it is the CREA. I am going to call the CREA on this – not that it will do anything. We paid $200 to have an evaulation of our property and it went down 5 percent last year and now 5 percent this year.

Please send me the link. I am tired of the pumping.

Thanks so much.

#181 Two-thirds on 12.15.11 at 5:14 pm

And so it has begun…

“China imposes tariff on US car imports

Additional duties will be charged on larger-engined American cars with General Motors, Chrysler and BMW all affected”

Echoes of 80 years ago?

#182 on 12.15.11 at 5:18 pm

That evil fractional reserve ‘money creation’ system everyone loves to hate, also works in reverse. Just watch.

#183 PG on 12.15.11 at 5:24 pm

If you don’t believe me that RP is a whack job, google it.

@ Sam.I.Am what state are you from?

#184 live within your means on 12.15.11 at 5:27 pm

To help get everyone in the mood:

T-Mobile’s Home For The Holidays

#185 Harlee on 12.15.11 at 5:32 pm

#34 thewhiteknight.
When I was in Vancouver in Sept. I tried selling a chunk of Sask. souvenir potash to the “Pawn Stars” who were appearing at the PNE racetrack.I was hoping to get Chumley,as I would have had fun telling him that it is used as fertilizer,but was directed to Rick instead. He was nice,got on his lap-top and started searching for…”how do you spell that again? P-o-t-a-s-h…?” After awhile he politely declined the pink rock,but the crowd was amused anyway. One lady watching asked me:”So he didn’t buy it?Ah,what do those Americans know anyway..?”,she said it with a grin on her face. Maybe I should have told Rick to check the TSX listings…Paw-tash,it’s stronger than dirt!
#102 Junius
A post that made me truly laugh today. Thank you for the CRAP!
#142 God
All the best to Mother Nature when you see her. She’s been sending us some really nice Winter weather here in Saskatchewan lately.Oh,and please keep an eye or two (or three) on Smoking Man.He’s a gem,and we all want the best for him.

#186 on 12.15.11 at 5:37 pm

2/3 re tariffs… more like echoes of 28 years ago.

#187 brainsail on 12.15.11 at 5:38 pm

Have you ever kept watching a movie thinking it would get better untill the credits started rolling and then you found yourself utterly disappointed?

#188 eaglebay - Parksville on 12.15.11 at 5:55 pm

#144 Form Man on 12.15.11 at 12:57 pm

You… missed the point.
As a taxpayer, I’m on the hook like everybody else.
CMHC is only involved in loser mortgages.
CMHC should not exist and should be shut down.
It should be up to the people to make their own deals.
Reading comprehension means that you should be able to read between the lines.
I cannot, and would not write a book, on this blog.

#189 eaglebay - Parksville on 12.15.11 at 6:16 pm

#167 fancy_pants on 12.15.11 at 2:48 pm

You must be a member of the “Occupy Something” movement.
Careful or you’ll give yourself a heart attack.

#190 eaglebay - Parksville on 12.15.11 at 6:20 pm

#173 Pr on 12.15.11 at 3:35 pm

Hedge funds meeting their margin calls.
They deal in big numbers. Bargain to the small retail buyer.

#191 Canadian Watchdog on 12.15.11 at 6:24 pm

Hello Canada.


#192 jess on 12.15.11 at 6:33 pm

influence and UBS private bankers
‘Pleuri Cell E’

largest home 27 stories high
9 elevators

#193 eaglebay - Parksville on 12.15.11 at 6:36 pm

#186 Two-thirds on 12.15.11 at 5:14 pm

Fair is fair.
The US will have tariffs on Chinese cars coming to America and and so will Canada.

#194 Form Man on 12.15.11 at 6:45 pm

#193 eagle bay

I think with logic. I don’t engage in games. Sorry to spoil your day.

#195 eddy on 12.15.11 at 6:53 pm

the only way I’ve heard of to the beat the bank discharge fee – port the mortgage, but that requires that you stay in the market

#196 tkid on 12.15.11 at 6:56 pm

Dude, that’s 76 seconds I’m never going to get back …

#197 The InvestorsFriend on 12.15.11 at 6:57 pm


I am with eaglebay at 119.

I have bought 3 houses in my life and avoided CMHC (with extreme prejudice) each time. I scrounged up the “down payment” in all three cases. That is, I borrowed part of the down payment. (In full knowledge of the bank in at least the first case, I paid 10% down, borrowed 15% on a co-signed loan from the same bank and the mortgage was 75%)

I just always figured a CMHC fee was a waste of money. Never paid it, never will.

#198 Rich Renter on 12.15.11 at 7:01 pm

Thank god that Alberta is on the verge of another boom.

#199 Kevin on 12.15.11 at 7:07 pm

Moody’s revises Ontario’s outlook to negative from stable on Aa1 rating–PR_233278

#200 Kilby on 12.15.11 at 7:07 pm

#147 Chubster.

Paragraphs can be your friends!

#166 Victoria.

Good luck, Broadmead homes all need renos as a good many were built in the late 60’s and 70’s. Find a good carpenter, finish and be the first to list in the spring. Lot of people won’t buy in there as there is not a lot of sun on most sites.

#201 brainsail on 12.15.11 at 7:08 pm

#186 Two-thirds on 12.15.11 at 5:14 pm

“And so it has begun…”

Not really the beginning. China has a policy that if you want to market your product in China you must manufacture that product in China or get hit with tariffs. You might be suprised with the following article. There are more Buicks sold in China than the US and the majority of those are made in China. Keep in mind that China does not have anywhere the emission or safety standards that the US has.

“In 2010, Buick sold over 550,000 cars in China, more than triple its sales in the United States.”

#202 gladiator on 12.15.11 at 7:22 pm

the worst part of this 153% ratio is that it’s calculated using pre-tax incomes, but people have to pay it with after-tax money! since the average tax in Canada is about 30-35% (I just need to be in the ballpark), then the average Joe has a 153% / 0.7 = 218% of debt to after-tax income ratio in the best case scenario (using 30% taxes) or 235% in the second case (using 35% taxes).
Now this is freaky…

#203 Mr. Lahey on 12.15.11 at 7:28 pm

#146 Ammo and Viagara

“I guess Mr.L’s party will settle this whole Ron Paul thing….or not”

#152 Ammo and Viagara

“Mr. Lahey, can you please use more adjectives/adverbs to describe our fearless leader”.

Yes the whole Ron Paul thingee will be settled when our fearless and intrepid leader, reader of financial tea leaves, mystic oracle, all knowing, all seeing, financial prognosticator, former right honourable parliamentarian, minister of national revenue and all round good fellow, Sir Garth Turner, completely destroys Ronnie in the debate Saturday morning. Garth just came over for our evening walk to the mess hall. He told me the debate will unfold right after his tartan Scottish jig. He wants to work up a sweat prior to taking both Ronnie Paul and Markie Carney on in the debate. The all knowing bearded one is so confident in his abilities he is allowing his two opponents to combine their forces in an effort to outwit our fearless and intrepid leader. Today as we came back from the airport in the Clydesdale led wagons we had to stop at a manure pile to dump the dale’s poop. Garth ran to the top of the pile and boldly exclaimed, “I am standing on Ron Paul’s election platform!” Bubbles laughed so hard he fell out of the cart once again. We are having a friggin blast at the FASTPGFBDCParty!! Get down here asap blog dogs!!!

#204 Mr. Lahey on 12.15.11 at 7:31 pm

#154 Ammo and Viagara

“I stopped believing in Santa Claus and the Easter Bunny a long time ago, but I am going to the FASTPGFBDCParty.”

We are really looking forward to having you Ammo!

#205 Onemorething on 12.15.11 at 7:38 pm

Protectionism – Trade Wars – Currency Wars!

who needs traditional wars these days!

#206 Spiltbongwater on 12.15.11 at 7:38 pm

Fair is fair.
The US will have tariffs on Chinese cars coming to America and and so will Canada.

#198 eaglebay – Parksville on 12.15.11 at 6:36 pm

How many Chinese made cars are currently on the road in Canada or U.S.A.? I am guessing somewhere close to the zero number.

#207 Mr. Lahey on 12.15.11 at 7:38 pm

#171 Triplenet

Mr. Lahey

“Im sure the paparazzi caught Form Man and DA getting on a WestJet flight to NS. I was at YVR this morning and saw Form Man showing DA how to use his construction laser sights and programming for ploughing in a straight line. BPOE was also with them teaching DA how to co-ordinate GPS settings and waypoints. I think Form Man has hired these two as advisors as they know where things have been and where the Formster is going.
I think these 3 are up to something”

Thanks for the heads up Triplenet! Yes blog dogs are arriving in droves as I type. The Clydesdales have been going non stop all day. The tractors are sitting majestically in the weed field at the starting line for the ploughing match. Westernman arrived today and took taken a few sample runs down the field. He said the Nova Scotian soil is plum perfect for this type of contest. He will be having dinner with Bubbles and then joining us for the preFASTPGFBDCParty square dance later this evening. He seems in a jolly mood and says he loves the east coast air. He is very confident in his ploughing prowess and says he can’t wait to get his Rolex from Carney. It is really shaping up better than I had anticipated Triplenet. We are down to 36 hours so I suggest you grab a flight out tomorrow so as to not miss all the festivities this weekend!

#208 eaglebay - Parksville on 12.15.11 at 8:15 pm

#211 Spiltbongwater on 12.15.11 at 7:38 pm

My post says “coming to Canada”.
Reading comprehension.

#209 eaglebay - Parksville on 12.15.11 at 8:17 pm

#199 Form Man on 12.15.11 at 6:45 pm

Your post is a game.
Don’t be insulted “big man”.

#210 wheredideverybodygo? on 12.15.11 at 8:36 pm

Just saw a CTV news report. In the GTA listings are down by 4%, prices are up 9%. Okay. It’s now a “sellers” market? When was it ever a buyers market? I thought prices only edged up if I followed all the news reports? This “up-sell” at this time of year which implies this is a good time to list is a little suspicious. Are they trying to slowly and quietly get people out of the theatre before the credits roll so that there will be less damage when everyone rushes the exits when they realize the theatre’s on fire? Or are they merely try

#211 ballingsford on 12.15.11 at 8:47 pm

Post today with CREA stats about increase in home prices and Calgary stats are at a 0 percent increase since Nov 2010. It would suck to be a speculator in that city.

I saw the article earlier today with the CREA stats, but I can’t find it now. I guess someone hid it.

Anyway, the downturn is happening and the powers to be are in camouflage mode.

Good night Irene!

#212 Westernman on 12.15.11 at 9:02 pm

Form Man @ #199
” I think with logic ” Nothing could be further from the truth…
” I don’t play games ” Hilarious… you must be near the bottom of your nightly bottle of scotch…

#213 on 12.15.11 at 10:39 pm

Harley Davidson successfully lobbied for a tariff on Japanese motorcycles over 700cc in 1983.

For anyone not old enough (or too old) to remember, this is the reason why 750cc models sold in Canada were 700’s in the US.

Things seem to have worked out ok for HOG since then.

Fast forward to present times. Japanese and other foreign makers now build motor vehicles in North America, thereby insulating themselves from the threat of duties, and currency shocks.

#214 Steady Eddie on 12.15.11 at 11:03 pm

Gold will go down some more at least $1400 USD. It’s tempting to buy more now though… everything will go down in nominal terms as de-leveraging occurs.. If you are a short term trader it will hurt. Long term gold is still a good trade.

No country will default with maybe just Greece. Gov’t will inflate currencies or they will reroll all this debt into SDR world currency and suck the value of your paper investments. Who knows… At the end of the day the 99.9% mean nothing to the TPTB.

QE will come… however the world will have to beg the FED this time. In the meantime put on your big girl panties and suck it up.

Possession is nine tenths of the law. It always good to keep a physical asset out of the banking system in these times.

I would argue the physical worth of gold is unknown because paper gold is leveraged like anything else.

If you want to be happy:

#215 Future Expatriate on 12.16.11 at 2:52 am

#120 In the US it will take a lot longer than 4 years to undo 30 years of failed conservative policies that created the largest wealth disparity between rich and poor since the Great Depression. People who want and demand quick fixes are the problem. The US political system was setup to work at a crawl.

#216 TurnerNation on 12.16.11 at 9:42 am

#161disciple on 12.15.11 at 2:01 pm

Yup I’ve noticed the zombie effect. Watch the morning commute – at least a third of people are wearing earbuds, completely cut off from the world and outside interaction. Another 50% are heads down thumbing away on Blackberry/iphone. Perfectly distracted. Someone could pull anything and nobody would notice.

As they are doing. One by one governments are being taken down (aka “transational provisonial government”) unelected or wiped out (Polish airplane crash), Egypt/Iceland/Syria/Iraq/Afghan/Libya/Greece/Italy/Poland/Spain/Turkey/Iran soon. But I’m just thinking too much…it’s all a string of perfect coincidences.

Look into the eyes of NATO’s head (He of “He’s killing his own people” fame). Scary stuff:

#217 pjwlk on 12.16.11 at 2:23 pm

#32 The Dividend Yield Investor: “I would like to go one step further and have mortgages at a maximum of 15 years with a required 20% down payment.”
Never going to happen. Housing is one of the few ever dwindling number of products that are still built in Canada and one that can’t be taken away by the Chinese.

Our love affair with the house ensures that we spend money in local retail stores and for trades people to renovate.

I think our society needs affordable housing for the majority of people and your suggestion of 15 year ams would preclude that.