Sold out

It must be terminally boring in Vancouver these days. How else to explain 1,214 people signing up to hear my pathetic speech on August 20th? Don’t you people have cable?

Anyway, we’re sold out. And the hotel is freaking out. Let’s hope the Fire Marshall doesn’t read this blog. The crack Greater Fool Advance Team is currently seeing if there are other venues available, so if you own a stadium or an abandoned Kia dealership, let me know. But for now (and probably for good), the Marriott Pinnacle on West Hastings is the place to be a week from Monday if you like skirmishes with minor public officials.

See? This is good. I’m not even arrived yet and I’m a problem.

So we have more texture on the devastating Toronto condo sales numbers the world first read about here a week ago. As I told you, deals for new units have plunged 50%. There are now 18,123 unsold, newly-built condos with never-peed-in designer washrooms sitting vacant. Several high profile projects have been shelved, but the orgy of building continues as witnessed by the latest building permit stats.

This means the landing will be rock hard. “We have hit the peak and we are on the down side of the roller coaster,” says the president of property tracking company Urbanation. You bet. Hang on. There are 196 condo projects currently in play, containing just under 53,000 units. And despite this obvious oversupply rushing to market, prices have yet to cave in any significant way.

What does this mean? An even harder landing. Builders have created product so expensive (averaging $600 a foot downtown) that investors can never rent out condos and have positive cash flow. Therefore the only possible reason to buy is a good chance at capital appreciation. And now that, too, is off the table.

Just a year ago speckers were still able to count on price gains of up to 20% from pre-sale to the moment they flipped the assignment. In contrast, prices have fallen about 11% since the winter, with more to come. Much, much more.

As bank economist Derek Holt was saying this week, “This is the market going through a correction that I think is needed to hopefully avoid what would have been an even worse outcome.” But he’s a banker. He’s paid to be a dweeb. (In fairness, Derek is one of the better ones, and I always enjoyed visiting his spotless, sad little cubicle.)

Let’s also point out that none of the stats we are hearing from the Toronto condo crash-landing or the VanCity melt reflect the recent effort of F and the federal peckerettes. It’s been less than a month since the 30-year amortization was offed, and typically it takes five times that long for mortgage changes to show up in sales numbers. Yet to come is the demise of the cash-back mortgage, depriving all those horny little couples with no money the ability to buy a condo with nothing down. And coming by Thanksgiving will be more restrictions on both borrowers and appraisals.

Meanwhile, what’s happening out in the world of financial assets (since realtors always like to scare people into buying houses by whispering the word ‘stocks’)? Well, the S&P index is flirting with a five-year high. Over 70% of all companies reporting profits have just trumped analysts’ expectations. The European Central Bank is going all Rambo, doing ‘whatever it takes’ to rescue the Euro. Nobody sane now expects the US to enter recession. Bond prices are starting to thaw and yields swell. Gold’s dead.

How obvious does this have to be? Over the next five years residential real estate will be a horrible investment choice. Expect falling capital values, elusive cash flow, rising property taxes and negative sentiment. In contrast, financial assets are filled with potential, based on sustained earnings, record heaps of corporate cash ($256 billion in Canada alone), rising dividends, protracted US growth, slapped-around Europeans and a torrent of money coming out of cash and houses and into markets when all this becomes obvious.

The return to growth will make the debt vigilantes look like fools, or like Marc.

He sent me an email Tuesday night. “A question before I watch you speak in Vancouver,” it said. Turns out Marc is a precocious little twit.

I had a dream. I was 15 years old and I knew how I was going to make my money. The plan was to get a good job in my early 20s, save up enough for a down payment on a home with a basement apartment, live in the basement and rent out the top floors. I would have the renters pay my mortgage and save enough to do this again and again and again. Eventually I would own a bunch of houses and a swimming pool filled with money a la Scrooge McDuck.

Fast forward 10 years. I’m now 25, I have a better job than I could have dreamed of, I have no debt, I’ve saved about $40K and I’m itching to start my master plan: buy a house and rent it out. However, my mother (who is a victim of real estate disaster) reads your blog religiously and is begging me not to buy anything. Oh, have I mentioned that I live in Vancouver and grew up in Toronto? I guess that’s pretty important to mention.

Well you’ve done it. Your blog, amongst other things including common sense, has convinced me not to buy a condo in Vancouver or a house in Chilliwack (the only place I could stretch my 40K far enough to buy a house). I’m going to stay in my rental and sit on my money.

My question is when (if ever), will I be able to make my dream come true? When will this housing and condo farce end? I want granite! I want stainless! I want a big deck with a huge BBQ that overlooks a pool and a shiny sports car in my 2000 square ft garage. I want a boat dammit! Oh, and I want all of this in Vancouver proper. I’m 25yrs old making 100K a year and I’m horny Garth. I want my fix.

Thank you, Marc. You’re the new poster boy for entitlement. Don’t you dare miss being there. Have big plans for you.

186 comments ↓

#1 petey on 08.07.12 at 9:28 pm

that pic is brilliant

#2 Blair on 08.07.12 at 9:29 pm

When is your tour coming to Ottawa???

Sign me up!

#3 Randy on 08.07.12 at 9:40 pm

How could he wear that colour ?!!

J’adore aubergine. — Garth

#4 T.O. Bubble Boy on 08.07.12 at 9:40 pm

If the RE Cartel was claiming that Toronto’s Land Transfer Tax (in place for 4 years now) was the reason for the slowing of the market this summer, does that mean that Flaherty’s “turn back the clock” CMHC changes (i.e. back to pre-Flaherty rules) will be noticed in 2016?

Looking back at F’s budget in 2006 (http://www.fin.gc.ca/budget06/bp/bpc3b-eng.asp), this whole disaster was completely telegraphed in the various policies he and Harper introduced.

1) All kinds of tax credits and programs for trades — needed to fuel the housing bubble.

2) “Allowing new players to enter the mortgage market” (i.e. AIG) — bringing the U.S. bubble-building know-how to Canada.

3) Increasing the amount of business that can be covered under the Government’s authority from $100 billion to $200 billion. (seems so cute and tiny compared to today’s numbers) — doubling how much the Government insured the bubble.

Add this to all of the government tax credits for producing “Canadian Content” house porn TV shows like Holmes on Homes, Love It Or List It, Property Brothers, Property Virgins, etc… plus the Economic Action Plan (home reno tax credit and other goodies), and this whole story is almost unbelievable. This doesn’t even touch the provincial/municipal tax breaks and debt incentives.

#5 OTR on 08.07.12 at 9:40 pm

Of all the guys who I’ve read regarding debt, this guy makes the most sense.No offense Garth, you’re damn good too.

We’re continuously in the cycle of creating more and debt to the ploint of collapse. Somehow, we’ve got to break the cycle.

http://www.youtube.com/watch?v=zwaS0w9wUF8&feature=related

#6 Samsara on 08.07.12 at 9:41 pm

Livestream it!

#7 T.O. Bubble Boy on 08.07.12 at 9:41 pm

(NOTE: those additional policies were not just from 2006)

#8 Saskatoon-Living on 08.07.12 at 9:42 pm

Here they go again; the realtors in S’toon saying we have a balanced market. Unbelievable.

http://www.thestarphoenix.com/House+Listings+down+slightly/7054930/story.html

#9 Smoking Man on 08.07.12 at 9:42 pm

Mark 100K a year is nothing, it sucks, chicken crap.

They say aim for the stars land on the moon.
I say try an break on threw to the end of the universe and don’t look back.

Start a business 8 hours a day 260 days a year and make just

8 bucks a minute,

getting others to do the work

Your a millionaire on your boat . it’s that simple

But if I said make 3850 per day most would say that’s impossible it’s how you look at shit.

Can you imagine if I head lined with Gartho, we would need stadiums.

But he can’t afford me . I suggest LaughingCon he would work for free.

Gartho what you calling it The Bubble Head happy dance

#10 Jay Currie on 08.07.12 at 9:45 pm

Yo, Marc, one word: rent.

Spend a year in the $800/m basement suite then move to one of the couple of thousand really nice condos with terraces which are going to flood the rental market.

Meanwhile, keep piling up the dollars and pref shares are likely your friend. Do the little challenge of saving 15% of take home. There are going to be a lot of hot little sports cars coming off lease over the next couple of years.

Buy used.

#11 Work & Tumbel on 08.07.12 at 9:45 pm

Garth, Any chance your tour will be coming to Rim land before its to late?

#12 Patz on 08.07.12 at 9:55 pm

US won’t slip into recession? Maybe they’ll tumble. I guess we’ll see. BTW I’m sane–I think.

Every day the possibility grows more remote. — Garth

#13 randman on 08.07.12 at 9:59 pm

Garth

What time will the scheduled bathroom break be?

Just asking…

R

#14 Pr on 08.07.12 at 10:00 pm

…Gold’s dead.
Go tell that to more than1 billion Chinese!
Chinese gold imports near record.
http://www.mining.com/chinese-gold-imports-near-record/

Good for them. Still dead. — Garth

#15 JSS on 08.07.12 at 10:00 pm

Garth, you look good in aubergine.

#16 TurnerNation on 08.07.12 at 10:02 pm

Entitlement? Latest Toronto Life mag hit the stands.

Feature story is of Toronto’s house bidding wars and its combatants. All are around my age group’s range.

I am shocked. The prices paid, the shoddy renos, the sense of entitlement and single-mindedness. None appear particuarly happy in their pictures.

I had a thought. Are they the next wave of casualtities? The walking wounded house poor. Are we looking at mortgage prisoners?
Likely, so.

#17 Grim Reaper/Crypt Speculator on 08.07.12 at 10:03 pm

Doesn’t matter….

Me and my posse’ got the first 1000 tickets…we will be scalping them on E-Bay.

F..H v and C(aka Cooper) get them at usual discount.

Bob Rennie pays 200% premium.

#18 Cory on 08.07.12 at 10:05 pm

I imagine it will be October before the recent changes really start to be noticed since the 90 day preapprovals will expire knocking out those who “rushed” in before it was too late.

The whole thing is mind boggling…it really is. Rents are going up because of the changes already, vacancy is down, layoffs galore, budget cuts in the patch….up is down and black is white.

Just like when I was a teenager….I’m so confused…..!!

#19 TurnerNation on 08.07.12 at 10:05 pm

Oh oh. Could we see rioting, after the Vancouver Greater Fool event? Would not be the first time…

#20 Bigrider on 08.07.12 at 10:08 pm

Did I read correctly? A return to growth? Dies that mean that your position you so adamantly held as little as a day or two ago on asset deflation has at least moderated somewhat?

Do we buy some growth oriented financial assets and sell some of the fixed income? ( dump some of the dividend positions that are so being’ humped’ by all)?

Asset deflation, particularly in residential real estate, has little to do with corporate profitability or rising financial assets. — Garth

#21 Djb on 08.07.12 at 10:09 pm

25 years old and making 100k/year, I call bull crap on that one.

#22 Led on 08.07.12 at 10:09 pm

what is Garth selling at the seminar? Hopefully it’s not AMWAY.

Salvation. Praise be. — Garth

#23 MiniMe on 08.07.12 at 10:18 pm

“Meanwhile, what’s happening out in the world of financial assets (since realtors always like to scare people into buying houses by whispering the word ‘stocks’)? Well, the S&P index is flirting with a five-year high. Over 70% of all companies reporting profits have just trumped analysts’ expectations. The European Central Bank is going all Rambo, doing ‘whatever it takes’ to rescue the Euro. Nobody sane now expects the US to enter recession. Bond prices are starting to thaw and yields swell. Gold’s dead.”

While I trust your opinion on RE I don’t trust your opinion on Markets and Stocks. Why? Just because I don’t think that you can explain what changed with the economy in the last week or so that could bring the markets “high” to such a degree.

Financial assets have been on an incremental increase for four years. — Garth

#24 Geelemitti on 08.07.12 at 10:21 pm

Corporate profits r up because of increase in unemployment and decrease in wages

http://www.businessinsider.com/corporate-profits-just-hit-an-all-time-high-wages-just-hit-an-all-time-low-2012-6

More salient is a paying down of corporate debt, technology and widening of markets. But feel free to fee oppressed. — Garth

#25 Country Girl on 08.07.12 at 10:21 pm

Garth, will you be bringing the show to K-W?…Pretty please.

#26 Condo Chris on 08.07.12 at 10:22 pm

Marc is what I like to call a “renter 4 life”.. Hey Marc, why don’t you let your mother tell you how to spend your hard-earned 40gs? Better yet, throw it in the stock market and see how it does for you there.

#27 Aaron - Melbourne on 08.07.12 at 10:25 pm

From the Gold Coast – Queensland Australia

1. Sell apartment to developer for $1.55m
2. Wait it out while developer goes into receivership
3. Buy back exact same apartment for $381k
WIN AT LIFE

*bonus point: name of developer’s company was “Bullish Bear”

http://www.goldcoast.com.au/article/2012/08/07/436190_gold-coast-real-estate.html

#28 TurnerNation on 08.07.12 at 10:26 pm

Bankers in a panic?

My bank sent a letter today. HELOC! Apply now and save $500 in set up fees. They charge set up fees?

“…to finance your goals using the equity you’ve built up in your home”.

WTH? The only way this “equity” will be replaced is using your own income, labour. Or, pension proceeds.
Talk about robbing Peter to pay Paul. Each $10000 borrowed will be translated into months of after-tax labour proceeds. Have fun with Freedom 85.

I though life’s goal was paying a mortgage off?

#29 PoorgEoisie on 08.07.12 at 10:37 pm

Smoking man you only make $480 an hour? Geez no wonder you’re still riding the GO’s

#30 Michael F on 08.07.12 at 10:39 pm

Garth

What’s the chance of posting your seminars on YouTube.
I want to email them to all our Realtors.

#31 PCF vs Orange guy's shorts on 08.07.12 at 10:40 pm

So found out today that PCF “Interest First” savings pays a pathetic 0.5% /year. I call to check my math, surly this can’t be right…

Yup, it’s 0.5% /year but since you asked (there’s a promotion right now) you can get an “Interest First” account with the same rules paying 1.35%… 2% for the next little while. I hate your hidden promotions and stupid games… but I’ll play.

Better than my portfolio, and your house.
:-)

#32 Sm_yyc on 08.07.12 at 10:42 pm

Hi Garth – is there going to be a video or audio recoding available of your talk on Aug 20th?

Calgary will get its chance. — Garth

#33 Palmer on 08.07.12 at 10:44 pm

Seriously why the constant hate for Kia in your posts? Bad experience? I’ve found my Kia to be extremely reliable and affordable compared to former Pontiac, Toyota, and Fords I’ve owned. But then maybe I’ve got the one Kia that works. Did a Kia hurt you in the past?

#34 Rex_b99 on 08.07.12 at 10:45 pm

Great advice, sell your house and put all of your money into the stock market…it only goes up you know. The US is the best country in the world and despite their multi trillion debt and yearly deficit, they are poised to continue with growth, creating millions of high paid jobs and resotoring the American Dream. I love that story.

Where did I say to buy stocks? — Garth

#35 45north on 08.07.12 at 10:45 pm

I want a boat dammit!

you want a girl

best wishes

#36 ryan perich on 08.07.12 at 10:46 pm

LOL @Turner nation

“I though life’s goal was paying a mortgage off?”.

Garth could have a new tag line for next blog.

50 years ago, people asked “what does it cost ?”
today, people ask “can I afford the monthly payments with interest”

50 years ago, people’s life goal was to pay the mortgage off.
today, people ask “how long can I put off paying off the mortgage for ?”

#37 Whattodo on 08.07.12 at 10:48 pm

“with never-peed-in designer washrooms ” hard to believe, construction workers peed first on them.

#38 renters rule on 08.07.12 at 10:48 pm

@ condo Chris:

Good luck with your (over) leverage problems

#39 TRT on 08.07.12 at 10:50 pm

Garth, how about a 1000 seat venue…with security…ample parking…chandeliers?? and a Scotch bar if wanted ;)

I’m in. — Garth

#40 TaxHaven on 08.07.12 at 10:51 pm

“Well, the S&P index is flirting with a five-year high.”

True. But stocks are still where you should be.

This is driven by a craven searching for yield. Dividend payers, REITS and bonds have screamed to absurd heights.

Everyone is desperate for CASH FLOW. They need it, lust for it, MUST have it – they have unitholders, retirees, bondholders, policyholders and investors crying for paper dollars. They can’t afford to speculate, even if they had a speculative bone in their bodies. More the pity…

This is intuitively the time to scoop up the unloved but financially sound NON-dividend payers. The HUI miners’ index has been CRUSHED, even though those companies are among the financially soundest. And the more speculative juniors have been driven into the ground. Sentiment in the sector is dismal – excellent fundamentals notwithstanding.

And…”bond yields ARE starting to thaw”… Watch out, yield seekers: there is a penalty for risk aversion!!!!

Buy when no one wants it. Bernanke wants everyone to speculate, anyway…

#41 NAM not HAM on 08.07.12 at 10:52 pm

When did bonds get cheaper? And how is good dead at $1600 +?

#42 A NightMare on Bay Street on 08.07.12 at 10:55 pm

God, saddened and angry at the greed and hornyness of Canadians pushing house prices to ridiculous heights, send a deluge a new rules to destroy real estate market and everybody went underwater, crying, begging.

Noah, an immigrant, the only renter in the city, lonely and nerdy, saving money and collecting animal DNA samples throught Ebay for years, survived.

It was the fuuurst day of a new era. And Noah told his story to the new young canadian couples impatient to build their own hut and how God spoke to him on a pathetic so shall we not do the same mistake again, ever.

#43 wes coast on 08.07.12 at 10:57 pm

At least Marc can admit he wants all that stuff. Entitlement is acting on that want in spite of logic. Good on ya Marc for the 100k a year, the honesty to admit you’re house horny and the logic to not blow you wad (of cash) on the first MLS listing u see. Good thing come – to those who wait.

#44 A NightMare on Bay Street on 08.07.12 at 11:02 pm

(on a pathetic *blog*. thx Garth)

#45 T.O. Bubble Boy on 08.07.12 at 11:02 pm

@ #16 TurnerNation

Yep – got that same letter for $500 off the setup of a new HELOC… as if the constant stream of ads in every single possible location wasn’t enough of a reminder that the bank is in the business of selling debt products.

I mean, I get ads on ATM screens, in online banking, on the bank’s phone system, on TV, in every newspaper, in every magazine, on bus shelters and other billboards, on the radio, and even in the “comfort zone” at Blue Jays games (http://toronto.bluejays.mlb.com/mlb/sweepstakes/y2012/tor/td_contest_form.jsp).

#46 Ferrari321 on 08.07.12 at 11:05 pm

If VAN gets you 1,200 people – I really hope you have a much bigger venue in Toronto lined up

#47 Smoking Man on 08.07.12 at 11:07 pm

# 29.

I ride the go cause

A writing the best book ever need charaters
B I’m broke and impovershed
C one too many cocktails pulled over
D I like twains
E I’m a perv like to look up dresses on train
F I own 4 cars but have 5 drivers I don’t need to drive
G I’m a lier never take a train
H I’m a tree hugger and its the right thing to do
I I like the homeless people at union give them money
J I don’t like to take out the alpha romaro

You decide

#48 ANONYMOUS on 08.07.12 at 11:09 pm

$100,000 per year for a 25 year old?

I just went to an employment councilor here in Waterloo and she informed me that anyone who has 10 years or more experience in their line of work is living in dreamland if they think they can get a job today earning more than $60,000 per year. And I’m talking about accountants, engineers, and other highly skilled people. This is all from a counselor who knows what she’s talking about.

Frankly, I think Marc really works at a bank and earns $12.25 per hour (or $25,000 per year), to me that would be normal pay for a 25 year old.

Garth, he’s screwing with your mind !

#49 Cristian on 08.07.12 at 11:11 pm

As an addendum comment for the idiot who, a few days ago was stating that Canada has a healthcare system envied by the whole world… maybe he should read this:

http://www.vancouversun.com/business/productiveconversations/Sick+health+care+system+made+Canadians+lose+more+than/7023115/story.html

Here’s your envied healthcare, buddy! Yep, the envy of the whole world…

#50 Mark on 08.07.12 at 11:14 pm

“Nobody sane now expects the US to enter recession.”

I’m sane, recession coming. Nothing has changed in the US, except they’ve piled on more debt since 2008. That’s this magical growth your seeing, it’s debt dressed up as growth.

As for Europe, if it isn’t clear to you by now that they can’t solve their debt crisis, it never will be. How many meetings and solutions does one problem need?

Excess debt has not been cleared from the system Garth, so how can this economy grow? How can the west pile on huge amounts of debt and not face negative consequences? Seriously Garth, explain it to us “Goldbugs.” I know you think we’re nuts, but how does one deal with this debt?

We are. — Garth

#51 John S on 08.07.12 at 11:15 pm

#40TaxHaven on 08.07.12 at 10:51 pm

Well Said!

Increase the weighting for companies that do well and voila you have S&P at 4 year high or whatever.

The whole market is controlled by central banks, partcularly the FED and ECB. Investors have left the building and only speculators are thriving in this high risk, low reward markets.

I missed your refreshing nihilism. — Garth

#52 OwlEyes on 08.07.12 at 11:16 pm

Check this dude out, he’s really funny:
http://transitionvoice.com/2011/08/no-shirt-no-shoes-no-problem-interview-dmitry-orlov/

#53 Scalgary on 08.07.12 at 11:24 pm

#48 Anonymous

Fresh Engineers are making $70k per annum in Calgary.

Don’t know about the knowledge of your counsellor…

#54 nonplused on 08.07.12 at 11:24 pm

The stock market is on a roll? Yet to surpass the 200 highs in inflation adjusted terms. Dead money that goes up and down.

Gold is dead? Well, it had a blow off peak and is now forecasting deflation, trouble ahead no doubt, but dead? No, its just a hedge as always. Gold and other physical assets are a hedge against papper money failures as always. And paper money always fails. But it won’t fail tomorrow.

Your real estate call is looking like its coming to be accurate though.

#55 nonplused on 08.07.12 at 11:24 pm

2000 highs. It’s probably well above the 200 highs.

#56 PoorgEoisie on 08.07.12 at 11:25 pm

I’ll piggy back ya to work for a mere $100/hr

#57 Jon B on 08.07.12 at 11:27 pm

What’s wrong with the usual Northlands golf course in Surrey?
I’m going to show up for the Vancity love-in on the 20th, but I’m starting to wonder if I’m joining a cult.

#58 Jane on 08.07.12 at 11:43 pm

Garth, are you familiar with Peter Schiff and his opinions on the fincial state of the US? Is he a doomer or is there some merit to his beliefs that increases in interest rates to a more normal 5% will bring the US housing market and economy down on its knees? Thanks.

It will take five years for 30-year mortgages to achieve 5%. The US housing market then will survive it. This time he’s wrong. — Garth

#59 TimV on 08.07.12 at 11:44 pm

#41, your employment counsellor is ill-informed. Get a new one.

If Marc were lying, he would have stated that he still lives with his mother, rather than trying to make it sound like he rents from a stranger.

#60 City Slicker on 08.07.12 at 11:55 pm

“Meanwhile, what’s happening out in the world of financial assets (since realtors always like to scare people into buying houses by whispering the word ‘stocks’)? Well, the S&P index is flirting with a five-year high. Over 70% of all companies reporting profits have just trumped analysts’ expectations. The European Central Bank is going all Rambo, doing ‘whatever it takes’ to rescue the Euro. Nobody sane now expects the US to enter recession. Bond prices are starting to thaw and yields swell. Gold’s dead.”

You’re funny Garth, the only tool the ECB has is QE to prop things up until the bond bubble blows, where do you think gold is going from this action.

#61 whibur on 08.08.12 at 12:14 am

Why not post August 20th on You tube!!! Then all your followers can watch… Since you are SOLD OUT!!!

#62 Mark on 08.08.12 at 12:19 am

I have employees in sales that are in their early and mid-20’s that make over $100k. It’s not that much for Toronto.

Believe it or not, but they whine to me about how broke they are.

I guess if you’re buying $400 belts, $700 loafers, and blowing over a grand a night on the weekends on bottle service, $100k doesn’t go very far.

#63 RichieRich on 08.08.12 at 12:20 am

to #53 Scalgary… yes a few new engs are making $70k/yr, but not too many so don’t overstate (I work at a company that hires these green kids). The lucky/brilliant might get on with a producer and see that, but most new eng grads are seeing 20% less in salary (and virtually no benefits)… which is still exceptional in my books compared to when I grad’d ~17yrs ago w/ my eng degree.

Garth… ETA for the next Calgary show? I enjoyed the last couple of presentations. Ever thought of charging a nominal amount for attendance and donating it to several local charities? might help scare off the conspiracy theorists…

#64 SOHO NE on 08.08.12 at 12:23 am

daystar your’e retarded right ? start your own blog or write a novel or something.COMEDY!

#65 Carpe Diem on 08.08.12 at 12:25 am

# 29.

I remember riding the Montreal Metro, in the late 80’s and bumping into P.E. Trudeau during my McGill years. It was an awesome exchange.

Do not discredit public transportation. I don’t use it today since Ottawa had light-rail 100 years ago but today it will costs billions to make it happen today – go figure!

#66 Leesa on 08.08.12 at 12:30 am

Garth, I don’t know how you can say it isn’t the right time to buy real estate in Vancouver. ;)

In the 7 km stretch of Kingsway in Burnaby starting at the west and moving east to New Westminster there are the following in various stages of pre-sales and pre-construction: (Not wanting to promote anyone I won’t name the developers)

1,114 units in 3 – 30 storey towers at Kingsway and Boundary

1 – 37 storey tower and 3 story townhouses at Kingsway and Patterson

202 units in one 45 storey tower at Kingsway and Willingdon (not fair to include as there were line ups in 2011 and it sold out in one day)

1,800 units in 5 towers between 35 – 58 stories at Kingsway and McKay

831 units being built by 3 developers each tower a block off Kingsway above the skytrain station

3 towers proposed 25, 30 and 40 stories at Kingsway and Edmonds

High-rise rezoned parcel at Kingsway and Edmonds

1 high-rise on rezoned industrial land 6 blocks from Kingsway and 16th

42 acres of industrial land rezone for residential 5 blocks from Kingsway and 10th avenue (developer is still trying to sell units in a recently completed building walking distance from this parcel)

That is a 7 km strip out of the entire lower mainland and doesn’t include the smaller 4 storey wood frame construction or hundreds of other developments around the lower mainland.

If that didn’t make you cry, then this will. From the local paper regarding the opening of a new development sales office “ The first 200 condo units sold out in two days despite media reports of a cooling real estate market.” And if you need a laugh…..”It will be the Piccadilly Circus of Burnaby.”

Will the construction ever stop?

#67 Carpe Diem on 08.08.12 at 12:32 am

#47Smoking Man

C :-)

#68 Not 1st on 08.08.12 at 12:33 am

Garth, it would be cool if you could arrive by helicopter after circling the west Van area first. Maybe land on some rich dude’s lawn too.

Lets talk U.S.A for a sec. On December 31st hundreds of billions of gov’t spending and tax cuts will revert unless congress acts. Either way, its a fools errand. Suspend the automatic cuts and the hundreds of billions just gets added to the national debt which is already 100% of GDP. By 2016 it will be $22 trillion and change. If they let the cuts go through, U.S.A goes into a double dip recession, more likely recession. How on earth does this end well?

#69 Roial1 on 08.08.12 at 12:44 am

#49Cristian on 08.07.12 at 11:11 pm

Here’s your envied healthcare, buddy! Yep, the envy of the whole world…

And you should look at WHO is doing the knocking of the health care system.

The “Frazer Institute” is so right wing they could work for an Un-named German chancellor with the first name Adolph. (and not blush)

If you talk to real recipiants of health care you hear a different story.

Just saying.

#70 Derek R on 08.08.12 at 12:54 am

#50 Mark on 08.07.12 at 11:14 pm wrote
Nothing has changed in the US, except they’ve piled on more debt since 2008.

No they haven’t. That’s only true if you’re talking about government debt and ignoring all other forms. If you include all US debt, public and private, the total debt/GDP ratio has dropped more than 16% since 2008. Read this article for details and references to the data.

So the US may not be out of the woods yet but it’s getting there.

#71 Tron on 08.08.12 at 12:58 am

#48 ANONYMOUS

I’ve been in sales management for 20 years and I’ve had some twenty somethings earning $100k + per year. It is rare but possible depending on the individual. Unlike most jobs sales has a very wide income earning opportunity depending on each persons ability and drive.

#72 Nostradamus Le Mad Vlad on 08.08.12 at 1:07 am


“You bet. Hang on. This means the landing will be rock hard. And now that, too, is off the table. An even harder landing. Much, much more with more to come. See? This is good. What does this mean? I’m not even arrived yet and I’m a problem.” — Yep, you’ve become a real pain in the ass for those who can’t see beyond the end of their noses. Rock on!

Marc — Lyrics only with musical accompaniment I decided against Material Girl (Madonna), as Marc isn’t a lady’s name. Enjoy!

#47 Smoking Man — “I ride the go cause — A writing the best book ever need charaters” — That’s how J.K. Rowling wrote the Harry Potter series — going to and fro on the train. Look at her now!
*
Bernanke Fragile recovery, and Open Ended Easing; Rasmussen Poll Telling; Ortega overtakes Buffett Doesn’t matter how bad economies are for the average Joe and Jane, the rich always get richer; Consumer Credit increased less in June, and Consumer Credit Not so good; Family Offices; The Idiot (Cdn.) Millionaire Nothing beats the experience of traveling and learning, esp. with the family in tow; Women CEOs Mebbe this is why the S&P is up; Killing Income Tax Be nice if it worked here; Slowdown in China’s electrical usage; London banxters Might coincide with the end of the ‘limpix; 2008 More job openings. Boom times or election? Xpurt Don’t follow them much, now as they’re generally wrong; Four Fiscal Cliff Scenarios; Top 20 Firms where the wealthy head; Spain’s highs and lows, and Italy faltering; Dumping Equities? Yes. See headline for question.

Globalists Gutting America headed for the hills, and Shell pulls 15 bln. cash out of EZone; More to do with the cycle change; John Mauldin No time for complacency; Beer Battle; The Elite wants everyone to be happily trapped in debt; Cost of Private Prisons; 11:16 clip Beyond BRICS; Debt Jubilees and Steve Keen; UK flatlining; Wealthy Brits? They could always go to Neptune; Euro bests US$?
*
Obomba Bombing Iran in Oct.; Five Things But I have no regrets at all; 25 Jan. 1995 Does anyone recall what they were doing then? I don’t; Mac’s OS Eight useful tweaks; Nice Camper Couple built it; Disarming America with the softly, softly approach; Lost kingdom of Cleopatra Underwater, with pix; 7:48 clip Aurora – Wisc. shootings seven days before opening – closing of Olympics; Pat Robertson A Satanic atheist? Agenda 21 The elite show no mercy for humanity; Seven Toxic Foods, drinks and additives; Iran’s Intranet Replacing the ‘net; Ebola Moving from Uganda to Tanzania. Interesting that the west arrived there only a few months ago.

#73 Superman on 08.08.12 at 1:13 am

Don’t drink the water while you’re here Garth. You’d be well advised to stock up on Fiji water before getting off the plane. No one drinks tap water in Vancouver anymore.

#74 My Head Hurts on 08.08.12 at 1:14 am

DAVID BERMAN
THE GLOBE AND MAIL
Published Tuesday, Aug. 07 2012, 2:24 PM EDT

“The second-quarter earnings season, which is now about 80 per cent done, is disappointing on a couple of fronts. Earnings for companies within the S&P 500 are growing at their weakest pace since 2009.

As well, companies have been relatively unsuccessful at topping analysts’ expectations – pointing to the weakest so-called “beat rate” also since 2009.”

Garth, I enjoy your views on the RE market and I agree with them. I think it stops there for me…but I’m just a dumb ass, not a cocky ass know it all.

Place your bets folks, hindsight will be crystal clear. Then we can come back here and sling shite at the losers…haha told ya so will make me feel so good. If I’m wrong then I just won’t come back.

Good luck folks, wish you all the best…pick your Guru and you won’t have to do any work yourself.

Thanks again Garth for the great RE info

#75 eagle eyes on 08.08.12 at 1:17 am

What’s wrong with GM Place Stadium?

The new draft guidelines on housing finance do not apply to credit unions. BC credit unions may have different practices including:
-less rigorous requirements particularly those to self-employed borrowers, and
-an allowable loan to value ratio of 80% on HELOC’s.
Credit unions are not required to adopt OSFI guidelines.

#76 Blue Monster Lover of Meats and Vegetables on 08.08.12 at 1:25 am

#58 Jane on 08.07.12 at 11:43 pm

Garth, are you familiar with Peter Schiff and his opinions on the fincial state of the US? Is he a doomer or is there some merit to his beliefs that increases in interest rates to a more normal 5% will bring the US housing market and economy down on its knees? Thanks.

It will take five years for 30-year mortgages to achieve 5%. The US housing market then will survive it. This time he’s wrong. — Garth
—-
It’s not the real estate he’s warning about, which will take a hit also, it’s the US treasury and the banks will default. The sovereign debt bubble at 5% interest is untenable. It’s either rates stay at zero and the currency is destroyed by high inflation or rates go up and everyone is BK’d.

The Game is OVER.

Non winners are losers. Who are you?
Got gold?

#77 Canuck Abroad on 08.08.12 at 1:46 am

48 Anonymous – “…I just went to an employment councilor here in Waterloo and she informed me that anyone who has 10 years or more experience in their line of work is living in dreamland if they think they can get a job today earning more than $60,000 per year. And I’m talking about accountants, engineers, and other highly skilled people…”

Absolute nonsense. Accountants with 10 years experience can make 200-300k a year or more in comp, especially if they are partners. And the average comp for a brand new CA in 2009 was 72k. Survey here (caution, pdf):

http://cica.ems01.com/CA_Profession_Compensation_Survey_2009-En.pdf

Obviously the salaries are comparable in other professions (lawyer, engineer) and even higher in banking. Your employment councillor is out to lunch.

#78 Yaletown Renter on 08.08.12 at 2:01 am

#62 Mark beat me to it. Seriously, $100k isn’t really that much in Vancouver for a professional income. Even if that professional is a 20 something.

As for the Waterloo career councillor, I suspect they are on the take to get cheap skilled labour for a certain tech company. Fell for this myself straight out of Uni.

#79 Tony on 08.08.12 at 2:04 am

Just like today money will be fleeing from stocks as indexes drop some 80 percent after the U.S. election is over no matter who wins the election. Stocks will be one of the few things that tank greater than Canadian real estate. What you’re seeing right now is the “last bastion of bullshit” but the end is nigh. The bear market rally has but a few months to run then it’s all over for the suckers who were roped into buying stocks.

#80 Arthur on 08.08.12 at 2:16 am

#48 ANONYMOUS
$100K for someone who is 25 in Vancouver is very high. $60K for an engineer with 10 years of experience is extremely low. Maybe it is like that in Waterloo but definitely not in BC or Alberta.

#81 The American on 08.08.12 at 2:55 am

The U.S. will not re-enter into recession. Garth’s definitely right on this point. Those who don’t believe, wait and watch. Apparently, Canadian “news” loves to cherry pick data to reflect otherwise. I will tell you this, Americans are better off today than they were only two years ago. The recovery is and has been well under way in the U.S. for a while now. It isn’t instant (as most things are in Canada). It takes time. Actually, come to think of it, I know of no other country on Earth that is more into instant gratification than Canada – believe me, it isn’t the U.S. Also, I know of no other country wanting the demise of the U.S. (economically speaking) than that of the Canadian population. There. That ought to get a couple of responses. Truth hurts I know. And for those looking to the devaluation of the U.S. dollar, I encourage you to review a chart of the value of the USD today compared to only a year ago. Then, I encourage you to review projections of the USD for the next two years Funny, huh? Educate yourselves. ;-) Bottom line is the U.S. is punching its way through. Don’t believe me? Well, believe the American voters when they elect President Obama again. Right-wing fiscal policy has proven disastrous time and time again. The upcoming presidential election is a farce. Polls lie. Obama has it in the bag… again. The public are seeing change (contrary to you yahoo readers, eh hem Ruprecht). An agenda is in place to watch the U.S. fail. It won’t happen, and it’s comical watching people state otherwise. The ignorance of those wishing for this failure to ensue is laughable.

#82 Derek on 08.08.12 at 3:17 am

“gold’s dead”??? the u.s. is going to avoid recession, duh??? europe’s ready to roll? Garth, I LOVE your analysis of Canadian real estate, but when you wander into global macro-economics I wonder if you’re not getting your information for the same MSM that you so disparage re: real estate. (btw europe’s a slow-motion train crash, while the S&P is a HFT-playground elevating on fumes).

#83 The American on 08.08.12 at 3:18 am

Marc could very well be that douche bag you saw the other day on Robson with his Lacoste shirt, collar popped, pink Pinguin shorts, deck shoes with no laces, listening to Flo Rida in his leased Lexus. Please, don’t be a Marc. He is all that is wrong with the universe.

#84 CriticalQ on 08.08.12 at 3:21 am

“Bond prices are starting to thaw and yields swell. Gold’s dead.” I have several issues with this statement, I love the blog, love yer rants, but I have to say that you are wrong on this one. Gold has been traded for the last 5K years or so and treated as money, fiat has come and gone, deflation, hyperinflation, ect.. One of the only things that has always held value over time is physical gold and silver(massive manipulation by banks now days btw) you can take your gold and silver anywhere in the world and you will able to trade it for stuff, or their fiats.

Aristotle defined five reasons why gold is money in the fourth century BC (which may only have been the first time it was put down on paper). Those five reasons are as valid today as they were then. A good form of money must be: durable, divisible, consistent, convenient, and have value in and of itself.

Garth, don’t start putting down gold yet.. that barbaric relic.

#85 Buy? Curious? on 08.08.12 at 3:38 am

I feel sorry for those condo dwellers that actually do own their condos. The poor craftsmanship of those buildings will mean that condo boards will have special assessments levied on them. And if the building isn’t fully occupied the condo fees will be raised every couple of years while the value of their place goes down every month. However, if you own one but are renting it out, you may be in negative cash flow for a little while, but long term, it could be a great investment. Unfortunately, not everyone can be a savvy investor, but patience in real estate can sometimes trump smarts in stocks. Go check out some condos this weekend. See if you can get some of your friends to go in on the investment and spread out the risk. Sitting around trying to time the market is for fools.

m.youtube.com/watch?v=9UMXWp0dcF4

#86 Ryan on 08.08.12 at 4:05 am

The United States is growing because of a rapidly growing money supply and government spending. Their deficit is still massive (10% of GDP). If money supply growth moderates and the US tries to balance their budget, they will be in a depression. How can you be so bullish on the US when their budget looks as bad as Greece?

#87 drydock on 08.08.12 at 4:25 am

Grow up.
Perhaps this will help.

http://www.youtube.com/watch?v=ONaPq2L-MRg&feature=player_detailpage

#88 geelemitti on 08.08.12 at 4:39 am

Corporate profits r up because of increase in unemployment and decrease in wages

http://www.businessinsider.com/corporate-profits-just-hit-an-all-time-high-wages-just-hit-an-all-time-low-2012-6

More salient is a paying down of corporate debt, technology and widening of markets. But feel free to fee oppressed. — Garth

Yup definitely, Corporate debt is what we should pay no matter what it takes

#89 P & T S on 08.08.12 at 5:12 am

Palmer on 08.07.12 at 10:44 pm

Seriously why the constant hate for Kia in your posts? Bad experience? I’ve found my Kia to be extremely reliable and affordable compared to former Pontiac, Toyota, and Fords I’ve owned. But then maybe I’ve got the one Kia that works. Did a Kia hurt you in the past?

Don’t worry, Garth has yet to see the light! Having hired a Kia Carnival (Sedona in the US) in Australia we were more than pleasantly surprised by everything, but most of all the build quality, functionality (= well thought out design) and economy. The Carnival is still the only 8 seater MPV to gain a 5 star safety rating in the US Market, and I note that unlike the Western manufacturers, Kia (and their sister company Hyundai) are expanding production capacity to meet overseas demand.

We still drive a 12 year old F250, but we’d be VERY happy to buy a Carnival (but – they are not exactly cheap – in Australia the model we hired retails at $65,000 which is up there in BMW / Mercedes territory). Dear they may be, but they cannot import enough to meet the market demand (average wait for a new one is 10 weeks . . . . .)

Hey Garth – try one, you might like it!! (Go for the Carnival – the diesel is just amazing and goes like the clappers!)

#90 Buy? Curious? on 08.08.12 at 6:35 am

Sorry about the link post. It was about renting out condos to families that will be occupying and renting out condos from prospective investors in the next few years.

Here’s the correct link.

http://www.youtube.com/watch?v=GDZ4fjZq-H4

#91 Piccaso on 08.08.12 at 6:55 am

Recession Generation Opts to Rent Not Buy Houses

http://finance.yahoo.com/news/recession-generation-opts-rent-not-040001312.html

#92 Toon Town Boomer on 08.08.12 at 6:58 am

#8 Saskatoon Living
Re: The article in the Starphoenix
Garth called this in a previous post when he said:
First sales weaken. Then listings start to swell. Bidding wars are extinguished. Soon price increases are erased. Sales declines gain momentum, and the media starts to notice. Realtors sweat a little, say the market’s balanced. Listings mushroom even as prices stay sticky. New condo projects are cancelled. Sales fall further. Realtors declare a buyer’s market – hurry! Now prices tumble lower, often crashing first in those hoods where they exploded higher just months earlier.

Maybe are Realtors here are starting to sweat a little.

#93 House Horny Housewife on 08.08.12 at 7:17 am

Ha ha ha ha !!

Garth, was that e-mail for real? Or did you make it up? It doesn’t sound like any real person would be so out of touch with reality that he thinks he can get all of that stuff on $100 K a year salary !! And to top it off he is Vancouver !! Is this kid totally insane?

Hey Marc, you can have all of this and more if you wish. Just marry a multi million dollar mogul. Otherwise, keep saving those dollars and aim just a wee bit higher than $40,000.00 before you even consider buying any kind of real estate. 40K won’t even get you a downpayment in MY neck of the woods for heaven’s sake.

Perhaps by the time you turn 30 you will have gained some maturity and substance and you will realize that all of that “stuff” will not make you happy. Houses need maintenance, BBQ’d food gives you cancer, shiny sportscars loose 90% of their value the instant you drive them off the lot .. not to mention they make you look like a loser who needs a big shiny car to make up for … ehrr .. other shortcomings … oh and a boat needs a dock and a place for storage and the gas to run it is insanely expensive. The granite is OK I guess (this is my kitchen counter of choice and I even have it in my shower .. although I prefer the antiqued stone as the shiny stuff is tacky) but the stainless will soon go out of style, just when everyone has it all over their kitchens.

If you think that all of this stuff will make you a happy person, you have a lot, and I mean, A LOT, of growing up to do. Perhaps a well grounded spouse will help you see the light. Go get one !

HHHW

#94 Timbo on 08.08.12 at 7:39 am

http://www.reuters.com/article/2012/08/08/us-banking-libor-change-idUSBRE87702320120808

“Traders developed their own coping mechanisms.

“It was a bit like being behind the bicycle shed at school,” noted one senior trader, who simply hedged Libor-linked positions to protect against any loss. “There was very little to gain by running to tell teacher.”

No tattling when your rigging the rates……

http://www.bloomberg.com/news/2012-08-07/king-seen-cutting-u-k-forecasts-as-boe-stays-open-to-stimulus.html

“The economy shrank 0.7 percent in the second quarter, the most in more than three years. The central bank said one-off factors exaggerated the weakness, adding that the near-term outlook is still likely to be weak. Britain faces a struggle to recover from a double-dip recession as the euro-area debt crisis undermines confidence and curbs demand.

Inflation is a “little more likely to be below” the target for “much of the second half of the forecast period,” the central bank said in its quarterly Inflation Report published in London today. U.K. inflation slowed to 2.4 percent in June. The central bank said the risk to inflation around its target are judged to be “broadly balanced by the end of the forecast period.”

Welcome to Japan, England. Hope you like the tepid growth and falling r/e prices………

#95 pbrasseur on 08.08.12 at 7:52 am

The American

I think you’re right about the US recovery, I’m just back from Florida and this time I could clearly see the difference with only a year ago, still a bit slow but activity is picking up, things are beginning to move again, it’s pretty oubvious.

As for Canada don’t be too hard on us children of the CBC (…), many years to come will be difficult, but we are still better off than Europe!

#96 Bottoms_Up on 08.08.12 at 7:53 am

Over 1200? Wow, you’ve now just surpassed enrolment to “Bio 101” at major universities across Canada.

Except your tuition is free.

Will there be a pop quiz after “GF 101”?

#97 Bottoms_Up on 08.08.12 at 7:58 am

#81 The American on 08.08.12 at 2:55 am
——————————————
What’s good for the US is generally good for us. A US economic slump/crash/catastrophe is NOT what we desire. Most intelligent Canadians get that (hello….biggest trading partner). Why make such asinine comments?

Congrats btw on Curiosity landing on Mars, I hope it is able to find evidence of past life there.

#98 Herb on 08.08.12 at 8:00 am

… so Garth grew a beard so no one would recognize him should that picture surface on the internet.

#99 Bottoms_Up on 08.08.12 at 8:02 am

#69 Roial1 on 08.08.12 at 12:44 am
—————————————
lol, talk to real recipients of our healthcare? As in, those that can’t find family doctors (I’m one of them and I live in Ottawa), those that get treatment on gurneys in hallways and shots in bathrooms? Those that wait 8 hours in emergency just to see a doctor? Those that can’t find a walk-in clinic over the long weekend because they’re all closed?

Yes, there are some great things, and great people, that work in our healthcare system. But there are also some horribly wrong, broken things too.

#100 lord lucan on 08.08.12 at 8:10 am

From Bloomberg:

The Recession Generation

http://www.bloomberg.com/news/2012-08-08/recession-generation-opts-to-rent-not-buy-houses-to-cars.html

#101 fancy_pants on 08.08.12 at 8:24 am

why’d you pick Vancouver? hehehe
unfortunately too late for my cousin who bought a fix-er-up semi in last year in Langley for way too much

#102 Nemesis on 08.08.12 at 8:45 am

I know you’re not going to be believe this, OldPol… but I once dated an heiress whose father, a Ghurka Colonel… had… well… similar tastes in fashion to your leader illustration. Funny Old World.

#103 Kitchenerite on 08.08.12 at 8:59 am

Jesus, Marc makes $100,000 a year but has only managed to save $40,000 so far? Not amazingly impressive.

#104 John S on 08.08.12 at 9:01 am

Garth, if the markets are based on fundamentals then why would they react to statements such as these?

http://www.bloomberg.com/news/2012-08-08/u-s-stock-index-futures-drop-amid-economic-concern.html

The market is run on hopes of stimulus. US Company earnings have taken a beating in Q2 of 2012 when compared to Q2 of 2011. That is a reality, not sure if it is a trend.

Drought and oil prices are eating profits in almost all industries.

Obsess over daily fluctuations and you will be wiped away. — Garth

#105 ANONYMOUS on 08.08.12 at 9:01 am

I know 6 Financial Planners in the GTA (Toronto). The lowest one is currently earning $23,700 per year and even though she has been searching for a better job now for the past 3 years and networks like mad trying to get ahead she cannot find anything that pays more. The highest paid one earned $47,100 last year and for him that was a ‘GOOD’ year, normally he earns far less than $38,000 per year.

I have 3 friends who work as accountants for the federal government in Toronto, one earns $54,600 per year, my lady friend earns $58,300 per year, and only ONE of them earns over $60K at $61,000. They ALL have over 5 years experience.

So please, don’t feed me no Bull-Sh!t about high pay, if you do then we all know you are on drugs.

You need better friends. — Garth

#106 Joe Bloggs on 08.08.12 at 9:02 am

So, Garth, you are pumping socks here, eh? And after all that crap you are trying to show yourself up as “a lone sane voice”?
Stop it man, it is time for you to wise up. BTW that dead gold is going up big time (just to let you on a secret). But … likely you do not get it anyway, just beyond your comprehension…

That’s me. A sock-pumper. Argyles or solid? — Garth

#107 Joe Bloggs on 08.08.12 at 9:15 am

#69 Roial1
Before “Just saying” you should have been “Just thinking” but not your case, you are just saying nonsense. Canadian healthcare system is just what it is – shitty at best. I have a lot of experience, but mostly watching other unfortunate folks in GTA. It cannot be anything else by definition because it’s a closed shop with no competition. And guess who is paying?

#108 TorontoBull on 08.08.12 at 9:19 am

oh Garth,
how about TSX, NIKKEI, DAX, HANG SENG?
and speaking of S&P earnings and revenue growth:
http://www.zerohedge.com/news/pace-us-downward-revisions-picking
the trend is undeniable!

The two greatest afflictions on this blog: myopia and recency. — Garth

#109 cramar on 08.08.12 at 9:55 am

See? This is good. I’m not even arrived yet and I’m a problem.

—————
Problem now! PROBLEM later!!

All you need to talk about is three things:

A) Your ridiculous hi-priced Vancouver RE is history!

2) Gold is DEAD! Forget it! Needs to be buried since you cannot eat it and it is not money anyway.

3) The U.S. has nowhere to go but UP!

Just cover those three things and I’m sure you will get the dander up of just about EVERYONE in the audience. Then prepare to leave town fast!

#110 disciple on 08.08.12 at 10:06 am

#40 Tax Haven… Bernanke is an actor, I’m just finishing off my investigation into his real identity… will keep you posted…

#111 detalumis on 08.08.12 at 10:18 am

#99 not having a family doctor is no biggie, I am a lot healthier not having one, in fact I left my last one because she was incompetent, she couldn’t even diagnose an inguinal hernia, I had to do that myself and now I do my own health care using google and walk-ins.

It’s a myth that having a family doctor makes you healthier, it generally means you are overtested for things you won’t get and put on lots of meds as well. The people I know that use them regularly are not healthier than I am, most of them are overweight, never exercise and take big piles of drugs but they are all considered model patients – i.e. they make a lot of $$ for the doctor.

#112 disciple on 08.08.12 at 10:18 am

#58 Jane… Peter Schiff is Pee Wee Herman. For absolutely undeniable proof, see my blog. Your world is a carefully crafted illusion.

#113 disciple on 08.08.12 at 10:24 am

#69 Roial… You’re right, and they do, except the last name is Ruse-a-velt. Adolf and Walt Disney were Kermit Roosevelt. History is a Disney/Hollywood production.

#114 Toronto_CA on 08.08.12 at 10:26 am

#105 ANONYMOUS on 08.08.12 at 9:01 am
“I have 3 friends who work as accountants for the federal government in Toronto, one earns $54,600 per year, my lady friend earns $58,300 per year, and only ONE of them earns over $60K at $61,000. They ALL have over 5 years experience.”

Those salaries seem very low for designated accountants, are your friends working on their designations or do they have them already?

I know I pump the CA profession here a lot, but hey, someone has to. My starting salary post UFE bump at Deloitte head office was higher than all those people back in 2000 when I was fresh out of university. And I’m pretty sure that despite slow wage gains, wages are higher now than they were 12 years ago.

For this 25 year old, it’s certiainly possible he is earning $100k, sales being the most likely position he’s in (if he’s handsome and charming and has a good product, why not?). But he could also have his CFA and be in banking, or have connections/nepotism that landed him a cushy job. 25 is a bit young to make that much in law, medicine, accounting, or engineering since all the schooling/articling required wouldn’t be finished yet or would have just ended.

As to the person who said that $40k saved at $100k/year isn’t impressive at 25, are you being sarcastic? That’s fantastic. $100k only takes home about ~$72k (less if he contributes to an RRSP from his pay); assume he’s been working what? A year or two? Probably saving more than 25% of his net take home (~$20k a year if he’s been working since he was 23).

#115 Jek on 08.08.12 at 10:33 am

Coming to Kelowna???

#116 disciple on 08.08.12 at 10:34 am

#99 BottomsUp… the only thing horribly broken is your understanding of health care. Do you ever get as sick of your lies as I do?

#117 disciple on 08.08.12 at 10:39 am

#107 Joe Bloggs – If you took more responsibility for the healthcare of yourself and your loved ones, your view of the system would change, but unfortunately, your ambivalence remains just as “shitty” as your opinion. You are the system, idiot.

#118 Chris Sitkowski on 08.08.12 at 10:53 am

Mr Turner,

Please explain to me why gold is dead during a time of crony capitalism (please refer to William Black) and government lies (john williwams @ shadow stats). Sounds to me like people are loosing faith in our world reserve currency.

Thanks, Chris S.

#119 NAM not HAM on 08.08.12 at 10:55 am

#66 Leesa on 08.08.12 at 12:30 am

presale condos for the public usually leaves these people with a very limited selection. Why? Because there are many investment groups making deals with the developer before the presale. It’s the presale of presales. Meaning, these groups gather up money to buy as many units as possible at a wholesale discount. This minimizes the risk on the developers and puts the risk to the buyers. By the time the presale starts, the public has little to choose from. So they buy on pressure because they’ve camped all night. So this is called speculation. Ir brainwashing. Whatever you wanna call it. You my friend, are caught in this.

#120 Hoof-Hearted on 08.08.12 at 11:13 am

What do you get when you hire (2) Chartered Accountants?

CACA

Not sure why many professionals pat themselves on the back…..many have simply bought into a system that is built on added paperwork that really accomplishes nothing .

#121 Rainclouds on 08.08.12 at 11:21 am

I’m with Samsara

Livestream Van Aug 20

#122 truth hammer on 08.08.12 at 11:21 am

$175,000 to clear a driveway…thats the greedy civic servant for you

http://fullcomment.nationalpost.com/2012/08/08/kelly-mcparland-a-snowy-driveway-in-iroquois-falls-explains-government-economics-101/

how much more abuse will the taxpayers take from these cretins?

#123 John S on 08.08.12 at 11:32 am

http://www.cbc.ca/news/canada/story/2012/08/08/scotiabank-housing-report.html

woohoo! 10% drop over 3 years. hahaha.

I would say multiply the 10% with 3 and may be that is a realistic estimate of the decline.

#124 Bottoms_Up on 08.08.12 at 11:37 am

#118 Chris Sitkowski on 08.08.12 at 10:53 am
————————————————
“Crony capitalism” and “government lies” have been around for many, many years. During which time gold was indeed dead. Much like real estate, take a look at gold prices circa 2000. Bubbles blow up.

#125 John on 08.08.12 at 11:48 am

Meanwhile, what’s happening out in the world of financial assets (since realtors always like to scare people into buying houses by whispering the word ‘stocks’)? Well, the S&P index is flirting with a five-year high. Over 70% of all companies reporting profits have just trumped analysts’ expectations. The European Central Bank is going all Rambo, doing ‘whatever it takes’ to rescue the Euro. Nobody sane now expects the US to enter recession. Bond prices are starting to thaw and yields swell. Gold’s dead.
——
You have chosen a really narrow view. The thing now is that these points are no longer arguable. The best way to have a more realistic viewpoint is drawing “discussion”. What’s off the table is the core dynamic in functioning representative democracies: Value. At all levels…and in all ways.

Yes…it’s a balance. In 1963 human nature existed. And there was a lot more denial than today. But an argument could be made that recieving and offering value had some space.

Your picture imagines a functioning society based on “positioning” with a throroughly posionous merger of capital-state-family. Forget perfection…but what about humanizing those three points? What’s your plan? Do you think you can’t have one? Do you believe there is a tangible consequence of removing value from a society? What advice would you give in a school assembly hall? Are they excluded? Yet you bristle at “un-Canadian” discrimination. Your entire proposition is stuck in discrimination….which is human. But at least some space. You are putting something forward quite “un-Canadian”. Where’s the evolution? At least begin to lay the ground for introspection. I mean…what the hell.

Casting all that aside, your arguments on corporate earnings and the US “entering” a recession are not defendable. Remember “consequences”? Include that for a real view. It’s impossible to maintain our paradigm without the illusions we had…now seriously undermined. Talk about that. It’s a foundation for suggesting good decision making once the real estate lie is busted up.

The bond market is in risk of a bubble too…

A lot of holes in your presentation.

As much as you despise capitalism, it works. There will be no US recession, hyper-inflation, currency collapse or debt-infused apocalyptic cleansing. Sorry. — Garth

#126 Gob Bluth on 08.08.12 at 11:49 am

Hey Garth!
Any plans to come to Halifax? We could use a good dose of bearded wisdom on the Atlantic coast.

Also, you state gold is dead, but do you advocate allocating a small portion (5%-10%) of a diversified portfolio to precious metals as part of a long-term strategic asset allocation? Or would an investor be better off investing in real-return bonds instead?

My books have indicated a consistent PM holding of about 5%, rebalanced as prices fluctuate. — Garth

#127 In The Doghouse on 08.08.12 at 11:52 am

Love those RE quotes :
Better move fast – Wont last long – Great fixer-uper.
Yup , I’m in my Kia , heading over to Abbotsford ( pedal to the metal – 60 Kmh ) as I ponder ” I wonder what kind of BS those Re agents will feed me this time ” probably the same as last time . Oh well , It’s a re-run of Gilligan that I’m missing and I’m in the mood to watch them squirm . Love their expression when I tellem… uuuuhhhh , I have to think about it . I’m in the market next year for a new car , hope to bump into the RE agent there flogging his speal. Better move fast , Wont last long , Great Fixer-uper……. uuuuuhhh I’ll have to think about it ………

#128 Gary on 08.08.12 at 12:13 pm

Hi Garth,

I have recently discovered your blog and been enjoying it ever since. My question is really when will the pain come? For example a house horny couple that put 20% down on a home and closed in April (the market highpoint). Despite anticipating making their payments for the next 5 years and in the face of declining property values, will they feel the pinch on refinance?
Assume that their property in Brampton (ground zero) drops 20% in value over the next 5 years. Will the bank really take that into account when refinancing, by telling the couple that they can only borrow upto 65% of the depreciated value? If that is the case then God help a lot of these Bramptonians.

#129 mingeford on 08.08.12 at 12:27 pm

” As much as you despise capitalism, it works. There will be no US recession, hyper-inflation, currency collapse or debt-infused apocalyptic cleansing. Sorry. — Garth ”

I was a firm believer in your first sentence Garth. However it took a knock following the financial bailouts to the “too big to fail” institutions during the GFC. Also the multiple government handouts to the auto sector over the years.

#130 Ex-Edmonton Mortgage Broker on 08.08.12 at 12:58 pm

#77 Canuck Abroad on 08.08.12 at 1:46 am

Accountants (i’m assuming you’re referring to CAs) making $200-300k with 10 years experience? hahahaha. maybe where you are, but definitely not in Canada. i know plenty of CAs (friends, associates and clients) with 10 plus years experience and although none of them have made partner, they’re just hitting $100k plus. I’ve seen the T4s and the NOAs so i’ve got hard facts. but who knows, maybe i’m hanging around all the underachievers….

#131 Alex N Calgary on 08.08.12 at 1:23 pm

Sometimes I wish you’d post different letters then the same formula time and time again. #1 Hey I’m 40yrs old and made a million dollars from real-estate (except its dangerous, but this guy made a million anyways) I want to buy a house or invest it, which is better?

#2 Hi Garth, i’m mid 20’s, my wife and I make 200k combined, or, I’m 25 and somehow make 100k, selling pot in Vancouver, errr I mean, I’m an engineer, oh wait that doesn’t make sense, i’m a….well don’t you ask questions that demand logic, i’ve saved 40k living in my parents basement, and should I get a first house or rent?

Maybe letters from real people who fit into the median income we read so much about.

Also keep up the good work, looking forward to when Calgary starts to decline then you can come to visit here too! Got a potential job at stepper homes, LOL thats job security for you right? far away as I can….

#132 snotglue on 08.08.12 at 1:28 pm

Contrarian investor = Garth
Contrarian fiat = precious metals

http://dailyreckoning.com/big-bazooka-theory-and-practice/

#133 cramar on 08.08.12 at 1:40 pm

Marc says:

“My question is when (if ever), will I be able to make my dream come true? When will this housing and condo farce end? I want granite! I want stainless! I want a big deck with a huge BBQ that overlooks a pool and a shiny sports car in my 2000 square ft garage. I want a boat dammit! Oh, and I want all of this in Vancouver proper. I’m 25yrs old making 100K a year and I’m horny Garth. I want my fix.”

————————

Marc, I hope that with more decades in your life you will come to the realization that material possessions are not the most important thing in life. What you want now is so superficial. That is unless you look to Smoking Man as your hero and roll model. Ask any addict if getting their ‘fix’ is of any lasting benefit.

#134 Derek Speed on 08.08.12 at 1:42 pm

Condo

– Condo sales dropped 10 per cent in July from a year earlier to 1,753 units
– Prices have fallen 11 per cent since February
– Howard Youhanan of Condoman Realty Inc., said some investors “will never see a return” because “the builders overpriced the units in the first place.”
– Urbanation also reported Aug. 2 that new condo sales plunged 50 per cent in the second quarter to 4,769, from a record high a year earlier, while there were a record 18,123 unsold new units.

http://www.moneyville.ca/article/1238289–toronto-s-housing-market-cools-following-flaherty-s-tougher-lending-rules

#135 truth hammer on 08.08.12 at 1:52 pm

Just a thought……I’m reading through the comments…..and it seems that ‘everyone’ is ‘making’ $100,000 p/a or $200,000 p/a……and these are everything from bag boys, skytrain cops, teachers, garbage men etc etc etc …….doesn’t anyone else think that this is all ‘hyperinflation’? The idea that a teacher or accountant/garbageman should be paid six figures is delusional……….mental masturabtion.

What does a liter of milk cost in Zimbabwe when ‘everybody’ makes a billion dollars a week? Is the farmer with the cow suddenly a trillionaire industrialist?

I think a lot of people are being misled by their own greed by thinking they are making 1970’s money in 2012. The numbers mean nothing if you don’t understand what goes into the calculation.

A million dollars ayear is nothing in a hyperinflated economy….we are seeing that in Canada where houses are a million….cars are financed for 8 years and food is so expensive that postmen are having to use multiple credit cards to pay for one weeks groceries.

These ‘accountants’ making $200,000 should know the differance by remembering the ‘six functions of a dollar’ . Are you a millionaire if bannana’s cost $10? What if a house bought in 1980 for $125,000 now costs $750,000 …do you really think you have ‘made money?

You fools are forgetting that the only money being made in this hyperinflationary age is being printed by the government.

You people are you’re own worst enemies.

#136 Victor on 08.08.12 at 2:04 pm

http://www.moneyville.ca/article/1238813–canadian-housing-market-headed-for-10-per-cent-downturn-scotia-economics

Canadian home prices are likely to decline 10 per cent over the next two to three years, before facing a period of “prolonged” softness in both prices and sales, says a new report from Scotia Economics.

“The correction will be concentrated in the Toronto and Vancouver markets, where supply risks and affordability pressures have the potential to trigger larger price adjustments,” says the report by Scotia bank’s Global Economic Research Group.

Pent-up demand for housing has been “effectively exhausted” by the decade-long housing boom which has seen home ownership reach record levels, the report notes.

#137 BradJLambofGod on 08.08.12 at 2:09 pm

Just want to add a +1 to the requests for letters from people in more ordinary circumstances … I work in downtown Toronto, I get it, every 20-something waterloo grad is rolling in dough, owning real estate, six figures in the bank and driving a convertible… for them the market works, the banks are perfect, and Toronto is the new Manhattan/Singapore/Hong Kong/Paris/Rome.

Write something for the rest of us. Those of us who might have (gasp) foregone earnings to earn a graduate degree or raise kids, or aren’t sitting on a 7-figure windfall for doing nothing but showing up 8 years ago when everything was LOL-cheap. Those of us who know lawyers who make <60k a year – yes they actually exist, and no I'm not a lawyer.

I'm sure these are real letters but it does strain credibility that EVERY single person has six figure income and/or real estate lottery winnings already cashed in.

Look forward to the roadshow in Toronto, let's invite my namesake, I'd love to hear his balanced viewpoint on things!

#138 disciple on 08.08.12 at 2:16 pm

The real reason for high gasoline prices. Finally, some truth in the media…

http://www.wheels.ca/news/generation-y-threatens-auto-demand/

#139 Chris Sitkowski on 08.08.12 at 2:17 pm

How can I find smoking man, i think i need his card… sigh

#140 syfon on 08.08.12 at 2:21 pm

Gold’s Dead
It is called base building

#141 Tony on 08.08.12 at 2:23 pm

DELETED

#142 Steven Rowlandson on 08.08.12 at 2:51 pm

Garth you might need a rad suit if your going to Ottawa.
It gets clicking hot there thanks to fukushima.
A geiger counter might be adviseable also.
http://www.soeks.co.uk/

#143 John on 08.08.12 at 2:55 pm

Garth wrote:

“As much as you despise capitalism, it works. There will be no US recession, hyper-inflation, currency collapse or debt-infused apocalyptic cleansing. Sorry. — Garth”
——-

I hope you are right about a softer landing and an evolution that doesn’t cause some kind of destruction. Keep in mind that the best aspect of capitalism is where value is offered…and an optimistic view of the future is shared by the society. Keeping it simple, a working model of Capital-State-Family. Each adding it’s role to evolve the whole society towards greater individual and collective wealth. Capitalism is the very best we’ve ever had…despite some glaring inadequacies.

Crony capitalism can emerge in a destructive dominant way when state and capital merge…where power groups decide value isn’t the main event. A free market stops deciding that to the same level it might have earlier.

Unmasking crony capitalism and the important changes it has brought to Canadian society doesn’t always have to be chained to an apocalypse. Looking more freely at true drivers ( including the individual…not seeing him as a victim) opens a space for the return of value.

Once value starts to drop away, things can get speculative…and the “something for nothing” entitlement culture is spawned. As well as all the dehumanizing character traits that go with it. Most importantly empathy. People become reptilian and isolated. More speculative and cynical. Less community-based.

Where to start? With oneself…not “the system”. What’s my value…what am I offering…what do I deserve. How can I “selfishly” serve ( value-based…the real capitalism).

Nothing perfect…but the real estate nonsense and world drama right now might mean some big social problems.

Getting away from debt and trying to stay “solvent” is important…but still…it’s not the message of what’s up in Canada.

People want value-based transactions and living. This is the issue in my opinion. Happiness.

#144 getreal-tor on 08.08.12 at 3:13 pm

@House Horny Housewife

If you think that all of this stuff will make you a happy person, you have a lot, and I mean, A LOT, of growing up to do. Perhaps a well grounded spouse will help you see the light. Go get one !

If Marc is smart he’d go for the sports car as he is better of losing 90% of the car value than 50% of his assets.

#145 getreal-tor on 08.08.12 at 3:19 pm

#138 disciple on 08.08.12 at 2:16 pm

I think high gas prices are directly related to greed and not because GenY shuns the automobile. Many GenY prefer to live in the urban core where a car is not a must especially when you consider the going rate for a parking spot with the condo… Factor in insurance, gas, maintenance and, yeah, a bike, bus pass, or even a car sharing service makes more sense.

#146 Realtors don't like realtors either.... on 08.08.12 at 3:49 pm

Old news…
http://www.readersdigest.ca/home-garden/money/one-one-mark-carney
Mark Carney is the MOST TRUSTED CANADIAN…. ROTFL!!!!!

Translation services available…
http://www.theeconomicanalyst.com/content/vancouver-housing-full-correction-mode-implications-canadian-banks

“Vancouver West-side realtor Marty Pospischil…specializes in selling single-family homes owned by long-term residents”
Means, he is “a listing agent for white people.”
Too bad he doesn’t speak Mandarin like the other Shills, get it, Pospischill, he’s a Shill…..hee hee….

Ok, seriously, BPOE – this is why we need realtors.
Can’t even sell a stolen Iphone without getting pepper sprayed at a public place. Geezz, should have gotten a REaltor for this job
http://www.cknw.com/Channels/Reg/NewsLocal/Story.aspx?ID=1751722

#147 Smoking Man on 08.08.12 at 3:58 pm

Bubble heads. The [email protected] Financial Post, CTV and all the other MSM outlets are calling for a 10 precent reduction and a stagnent market. Amazing how the stories hit the wire at the exact same time.

Translation. That’s what the machine wants well condos are going to get hammerd say 20p. But SFH in 416 will be up another 5p come next year this time. Next thing you will see is Iventory disapear, those who missed getting a greater fool will wait for the next up tic. C and F want to make sure that the soften up the market

Before the pigs force our rates to the basment

#148 cramar on 08.08.12 at 4:03 pm

Have #2 son from Chicago visiting for a few days. He says a 1BR condo in his nice north Chicago location on the lake is now going for $80,000. A 2BR for $140,000. What was the price again for downtown Toronto condos?

#149 Aussie Roy on 08.08.12 at 4:29 pm

Aussie Headlines

Aussie “No subprime here”, heats up in court

Over the past few months we have heard numerous stories of home loans being extinguished by the Supreme Court on the basis they were fraudulently provided to people who couldn’t afford them. In some cases, lenders provided loans to individuals that had been unemployed for some time, and almost always overstated the borrower’s income. Despite reassurances our banking system was best practice, hundreds of emails from lenders and brokers has surfaced demonstrating predatory lending practices.

http://www.whocrashedtheeconomy.com/blog/2012/08/senate-briefed-on-subprime-crisis/

It was different here, until it wasn’t

We have seen the figures, now we are hearing it first hand from the industry. It’s reporting season and Matthew Quinn, managing director of property developer Stocklands has said the property market is the worst in 20 years.

“The market, 20 years ago, was 20 per cent stronger than now. We believe the structural change will be with us for some time to come,” said Mr Quinn.

It appears to be an honest and frank assessment of the market with his mention of structural change.

http://www.whocrashedtheeconomy.com/blog/2012/08/residential-property-sector-worst-in-20-years-stockland/

#150 Canadian Watchdog on 08.08.12 at 4:35 pm

Here comes Genworth to save BC foreclosures by paying their mortgages free for a year or so http://postimage.org/image/b2eqflp5r/

#151 BradJLambofGod on 08.08.12 at 4:35 pm

OK I have finally come around, after months of reading this site I have to admit that Smoking Man sounds pretty reasonable.

“That’s what the machine wants well condos are going to get hammerd say 20p. But SFH in 416 will be up another 5p come next year this time. Next thing you will see is Iventory disapear, those who missed getting a greater fool will wait for the next up tic.”

I’m fairly sure that’s true, and the area I live in (few condos, lots of SFH) fits the bill perfectly. The few condos are empty, unsold or rented out, and the SFH still go for $40k+ over asking in bidding wars. Given how insane prices are, $40k is probably about 5% of the overall “value.” Some of the condos have been waiting a year+ to get enough pre-sales to start building and still can’t make it happen, I suspect they never will and developers will just shrug and pack a bag for the Cayman Islands.

#152 Westernman on 08.08.12 at 4:42 pm

Truth hammer @ # 122,
How much more abuse will Canadians take from our beloved public service cretins?
The answer is INFINITE! Canadians just adore paying the highest tax rates in the world to support any worthless scheme or government agency, focus group or any number of other publicly funded parasites and/or boondoggles.
The average Canadian has such a gigantic guilt load that they just can’t get enough of being taxed into oblivion…
You know… save the world and spread socialism and so forth and so on…

#153 House Horny Housewife on 08.08.12 at 4:57 pm

#144

Might you be making a rather sexist assumption perhaps ?

Who says that Marc will bring in most of the family income ? Perhaps his spouse will be the main bread winner and perhaps the spouse will come into the marriage with more assets (even liquid ones rather than granite and stainless).

In this case it is Marc who would stand to gain with your marriage sharing 50-50 scenario.

Besides, if neither person wants to become entangled financially, there is something called a prenup.

The shiny penis replacement on wheels .. still a bad idea, financially or otherwise.

HHHW

#154 truth hammer on 08.08.12 at 5:17 pm

This one for the ‘STOP THE HYPOCRISY’ file

-this morning on Radio 98 CKNW…it was reported that the elite unionists….these outrageously paid nouveux wealthy civil servant class ……have been secretly using the city’s private health care clinics and paying cash….cue jumping just like they accuse the ‘rich’ of doing………holy stalinism batman….is there moral corruption in the ranks of the rich civil service elite?

-among these elitist fobs included high ranking members of the nurses union…..the very richest and overpaid civil service class who are currrently taking 100% of the tax revenue collected by the health ministry….wages so high that there isn’t a thin dime to provide health care to the citizen……and yet they want the rest of us poor people to stand in line……and today the BCGEU is threatening us again with job action if we don’t give in to higher wage demands……..will the hypocrisy never stop????????

Will Canadians ever wake up to the fact that a new elite class of pathetic bourgeoise has emerged to scream “Let them eat cake’ while grannies and heart patient die in the hallways of BC hospitals.

#155 jess on 08.08.12 at 5:28 pm

48 ANONYMOUS

unless you are one of the trading quants
or star traders

#156 jess on 08.08.12 at 5:36 pm

Canadian Watchdog on 08.08.12 at 4:35 pm
Here comes Genworth to save BC foreclosures by paying their mortgages free for a year or so

oxymoron – banks do loan mods while at the same time start foreclosure proceedings and sponsor Habitat for Humanity?

The Top 5 Most Hypocritical Corporate Sponsors | Alternetwww.alternet.org/…/top-5-most-hypocritical-corporate-sponsors?pagi…Cached
You +1’d this publicly. Undo
30 Jul 2012 – Foreclosure giant Wells Fargo sponsors Habitat for Humanity? … But it does matter if the organizations accept money from corporations that …. in an attempt to take down Democrats who supported the Affordable Care Act.

#157 emotionsruinthefinestplans on 08.08.12 at 5:40 pm

#153 House Horny Housewife

Your every post makes me more and more pleased and grateful to be gay.

25 years old, 100k / year, 40k savings, single. Compare that to the last 5 or 10 of Garth’s email posts; “my wife will leave me if I don’t buy a house”.

Our boy from this morning seems to be doing fine.

Stick to making sandwiches and leave the financial advice to Garth, imo.

#158 Investx on 08.08.12 at 5:51 pm

88 geelemitt:
Corporate profits r up because of increase in unemployment and decrease in wages

http://www.businessinsider.com/corporate-profits-just-hit-an-all-time-high-wages-just-hit-an-all-time-low-2012-6

More salient is a paying down of corporate debt, technology and widening of markets. But feel free to fee oppressed. — Garth
—————————————————
Yeah, why would people feel oppressed when corporations make record profits while jobs and wages shrink.

#159 Dan from Richmond Hill on 08.08.12 at 6:07 pm

Where did I say to buy stocks? — Garth

Garth, but all the financial products you recommend, are not related to stocks, one way or another ?

So is your salary. — Garth

#160 Jim of North York on 08.08.12 at 6:12 pm

First time posting and from what I see north york has been selling but for well below asking and this even after price drops. Right now nothing is selling and the only sold signs are from two months ago. I’ve also noticed many realtors posting on here and with the slowdown in the RE market I now understand why. It seems many people are openly talking about the RE market being overvalued and looking to fall. I think a 35-45% drop over the next three years seems like a sure thing. I know the many realtors on this blog will disagree but then again you are realtors. If the market was doing well you realtors wouldn’t be here.

#161 Marc on 08.08.12 at 6:33 pm

Thank you for publishing my letter Garth. I’m really looking forward to the speaking event and will be down for whatever big plans you have for me. I don’t mind learning from a public lashing.

I thought I might set the record straight on all of the comments about me but then I realized that speculation is much more fun.

See you on the 20th!

#162 Kim on 08.08.12 at 6:35 pm

Smokingman you are an idiot realtor. You have no education in economics and thus couldn’t see the housing crash even though it is slapping you in the face right now. The RE market is crashing and will crash . As the RE economy slows down all those people who earned a living in RE will have no job. Those who do find a job will be making much less then their welling paying construction/RE related jobs. These people will be spending less money and thus will slow other sectors of the economy which is already happening. When they default the economy will slow even further. Why couldn’t the lol “machine” stop the US housing crash? Maybe the machine wants to crash the Canadian housing market just the the US . I guess it’s just different in Canada smokingman.

#163 Hoof-Hearted on 08.08.12 at 6:38 pm

Bankrupt California cities slash public services to fund six-figure pensions

http://rt.com/usa/news/california-bankrupt-taxpayers-pensions-874/

As some California cities face bankruptcy, public services are being slashed so unusually high pensions can stay on the books. Stockton’s former police chief rakes in a pension of more than $200,000 a year, while also working another job.

­Former Stockton Police Chief Tom Morris retired with a $204,000 pension after just eight months on the job. While his California city became the largest in the US to file for bankruptcy, he moved to another city and makes an additional $76,066 salary at a new job.

The former police chief retired at age 52, and was among four of the city’s chiefs who held the job for less than three years, while retiring with an average of 92 per cent of their final salaries.

But Morris’ unusually high pension is not an isolated incident. City councils across California have allowed public safety employees to retire after working for 30 years and collect 90 per cent of their top salaries. But while raking in a sizable pension, they often take jobs elsewhere, while still in their early 50’s.

Two former police chiefs in San Bernardino receive similarly high pensions. Keith Kilmer receives $216,581 annually, while working another job.

His predecessor, Michael Billdt, who has no college degree and was accused of trying to bribe an officer to withdraw a union grievance in exchange for a dropped investigation, receives $205,014.

“We have some safety retirees that are actually earning more in retirement than they earned when they were working, because they were able to manipulate the system enough in that last year that they could crank that last year’s income and then get 3 per cent times their 25 to 30 years,” said Kathy Miller, the city’s vice mayor, in an interview with Bloomberg News.

And these pensions are significantly higher than normal – an average annual payout from the California Public Employees’ Retirement System is $36,780.

While Stockton decided on Morris’ exceedingly high pension before going bankrupt, at a time when its finances seemed promising, it is now struggling to confront rising pension costs while also dealing with increasing unemployment and declining property and sales tax revenue.

etc etc.

#164 Mark W on 08.08.12 at 7:11 pm

Do you mean there are even 1214 people in Greater Vancouver who read this “pathetic blog” … amazing.

http://www.realtor.ca/propertyDetails.aspx?propertyId=12265230&PidKey=1238428646

I remember when you told people that you lived in East Vancouver that was the bad part of town.

“That guy’s named Johnny, and you don’t wanna mess with him cause he’s from EAST Vancouver.” (circ: 1957).

“East is East and West is West, and never the twain shall meet..” (Kipling)

#165 ANONYMOUS on 08.08.12 at 7:17 pm

to #160 North York: I sure hope you are correct about that. If you are correct then that’s good news !

Garth Talks about buying “PREFERRED SHARES”. Well, if interest rates don’t go up then sure getting 6% on a bank’s preferred shares is great, but if rates go up then the value of those preferred shares will fall similarly to the way that bonds will fall under the same situation. Frankly, I don’t think rates will be going up anytime soon, so buying Garth’s preferred shares is a good idea (for now).

#135 Truth Hammer: = yes, you are totally correct !

#166 TurnerNation on 08.08.12 at 7:33 pm

The Fire Marshall will probaly later become a Senate patonage appointee by the CPC, if he shuts the Pathetic Tour down.

Hey what happened to our uber democratic, grass roots CPC? No longer. Power is absolute. Fool me once…loser hammer.

#167 prairie gal on 08.08.12 at 7:46 pm

truth hammer:

Holy hyperbole. So what if nurses and other public servants want to pay out of pocket for private health care services? Its not queue-jumping if they are paying for it. Maybe if you asked them they would tell you they agree with a mix of public and private delivery of health care.

Oh, and how does that have anything to do with grannies dying? Old people die. They’re old. Get over it. What – you thought they would live forever?

Granny and the other heart patients are welcome to pay for private health care also. Their money is as good as anyone’s. It won’t help them live forever, though.

#168 Nostradamus Le Mad Vlad on 08.08.12 at 7:51 pm


#102 Nemesis — “. . . whose father, a Ghurka Colonel… had… well… similar tastes in fashion to your leader illustration.” — Would this be more appealing?! (Sound up.)
*
War on Iran destabilizes everything, esp. the world economy; 2:16 clip Paul Volcker is embarrassed by a reporter’s Bilderberg question; Misleading The BBC is consistent, at least. Remember WTC7? Speaking of Wells Fargo plus other links; Designed to Fail Morgan Stanley sued; Banxters or Parasites Choose wisely; Congress forces USPS into default, but here is the other side of the story; Plummeted Median wages since ’69; SKorea Resumes importing Iran’s oil; BoE Zero growth, or stagnation.
*
Journalist None of the rebels are Syrian and Russia helps Syria if US supports rebels. Fair exchange; 4:37 clip Forced vaccination, now autistic; Eco-Tyrants The True Useless Eaters; Cloud isn’t safe Not from this person’s experience; CC sudden increase in BS, and this — 97% of the world to be destroyed tomorrow! Sheep Texting or Shexting, as it is better known as; Romney What’s the difference between Sikh and Sheik? Trudeau’s ‘fuddle-duddle’; Europe Govt. snooping well underway; Drones Air drones, sea drones, clown drones; Egypt “Morsi appears to be purging his administration of anyone sympathetic to or aiding Israel’s false-flag attacks in the Sinai.” wrh.com.

#169 Mithan on 08.08.12 at 8:12 pm

This just in:
Canada to see 10% housing drop.
http://business.financialpost.com/2012/08/08/canadian-housing-prices-to-fall-10-over-next-few-years-scotiabank/

I don’t know, but I am only 36 and while certainly not an expert in finances, I know one thing from studying economic trends over the last 100 years and that is that prices tend to drop a LOT after a huge run up (and vice versa).

Happens with pretty much every asset class.

#170 Herb on 08.08.12 at 8:24 pm

Westernmoron and Truth Hammerer,

your problem is that most Canadians know more than you two. They know enough public servants and union members to realize that most of these are neither rich nor leeches, and they have enough contact with reality to know that their work is necessary. And they know the exceptions that confirm the rule.

Unless you start producing facts that would support your jeremiads (and your opinions are not facts), your ranting and raving will remain an abuse of electrons. Poor electrons!

#171 AprilNewwest on 08.08.12 at 9:38 pm

#169 Mithan. We all know these people are just trying to play is down. It will be much worse than a mere 10%.
Apparently,it’s already down 16% in the Lowermainland of BC and more likely another 30% on the way. As some of you have suggested housing in many parts of Canada needs a 50% at least correction. Vancouver and Toronto for sure.

#172 KG on 08.08.12 at 9:53 pm

Why is my fix late today.

#173 Calgary Car Guy on 08.08.12 at 9:53 pm

getreal-tor said:
@House Horny Housewife

If you think that all of this stuff will make you a happy person, you have a lot, and I mean, A LOT, of growing up to do. Perhaps a well grounded spouse will help you see the light. Go get one !

If Marc is smart he’d go for the sports car as he is better of losing 90% of the car value than 50% of his assets.
——————————————————————
As someone who works in the car biz and also pays big alimony/support payments I couldn’t agree more! Lol! I’ve come to believe many (most?) women marry for money (stability) and many (most?) guys marry for sex. Trouble is the women start playing with the availability of sex after marriage to get what they want but if the guy wants to break the “contract” because of it he still has to pay her the money! I’m half-way through my alimony prison term next month. Only 3 years 9 months to go! Woo-hoo! OMG!

#174 a prairie dawg on 08.08.12 at 9:54 pm

#97 Bottoms_Up

Congrats btw on Curiosity landing on Mars, I hope it is able to find evidence of past life there.

– — –

A Canadian team built the device to analyze the samples they collect.

But Canada and the US will always be that big brother/little brother fight.

The never ending story… lol

#175 Mr Buyer on 08.08.12 at 10:04 pm

The bashers of big guvment are looking for freedom. For some that means the freedom to cheat as much as they wish with as little oversite as possible. Police, they do not need no stinking police.

#176 Smoking Man on 08.08.12 at 10:08 pm

DELETED

#177 Calgary Car Guy on 08.08.12 at 10:12 pm

Re/ my previous post–No I didn’t marry for sex per se, but I did marry for the the wrong reasons. Thus I pay. Do NOT marry anyone for any reason other than TRUE LOVE. Otherwise you’re a fool and will end up losing big time. Also, if your marriage is an unhappy one GET OUT! Don’t waste your life staying with someone for material reasons. It just isn’t worth it.

#178 Mark W on 08.08.12 at 10:31 pm

http://connecticut.cbslocal.com/2012/08/08/study-almost-half-of-americans-die-with-less-than-10000-in-assets/

http://www.weeklystandard.com/blogs/over-100-million-now-receiving-federal-welfare_649589.html

These two news stories speak for themselves.

#179 Steven Rowlandson on 08.09.12 at 12:10 am

I agree with #48 , ten to fifteen an hour is pretty much an iron ceiling for skilled and unskilled labor in canada and variable hours is part of the deal. People in that position might be alive in canada but thanks to the real estate market and a no real pay raise policy such people have no way of ever living in canada. Canada as Garth knows it is for the FIRE economy, corperate leadership and government people only and that is a fact. Those that disagree are living in a dream world.

#180 getreal-tor on 08.09.12 at 1:46 am

#153 House Horny Housewife on 08.08.12 at 4:57 pm

Might you be making a rather sexist assumption perhaps ?

The shiny penis replacement on wheels .. still a bad idea, financially or otherwise.

You assume that a sports car is a shiny penis replacement on wheels and yet I was making a sexist assumption?

HHHW, perhaps you have penis envy ’cause that would explain some of your statements.

#181 truth hammer on 08.09.12 at 2:19 am

#167……PG….you missed the point…it is the nurses using the private sytem that are adamant that the clinics shouldn’t exist……ergo the hypocrisy of the elitist unions…..

Herb……blame CKNW for bringing out the facts as you so desperatley need….find them on the CKNW archives.

#182 Samour on 08.09.12 at 2:28 am

I’m another Marc :) except with maybe 30% more in savings and I make 10% more a year at 25. And yes I know it’s not nice to brag… but I want my fix too :p

#183 Nariman on 08.09.12 at 10:46 am

Garth, you’ve got a great spirit, but man I wish you would stop mentioning metals! It does nothing for your credibility. Gold, Silver, Corn, Brent are the top performers since the 5 year anniversary of the great crisis – if anything, this will accelerate in the next 5:

http://www.zerohedge.com/news/gold-silvercorn-brent-are-best-performers-5-year-anniversary-great-financial-crisis

Of course, silly me. Past performance is a guaranteed indicator of future returns. — Garth

#184 Ross K on 08.09.12 at 11:08 am

`that investors can never rent out condos and have positive cash flow. Therefore the only possible reason to buy is a good chance at capital appreciation. And now that, too, is off the table.

Just a year ago speckers were still able to count on price gains`

As in 1989 speckers out numbered investors certainly over 50 to 1 and I would argue the condo market is probably over to 100 to 1 today, with almost NO purchases made for a 25 year investment.

Regular home buyers in the last 5 years were probably speckers themselves where up until 2007 almost all were investors with a 25 year or more ownership goal.

The quote above from Garth`s post today, is something that most `so called experts`, ( it`s amazing economists claim to be expert enough in real estate to make any kind of prediction ) need to review before talking about a slow cool down.

Want to get a real wake up call, just talk to a specker.

#185 Herb on 08.09.12 at 11:57 am

#181 Truth Hammerer,

Talk Radio as your source does explain a lot.

#186 Jonno on 08.09.12 at 5:16 pm

#48 we pay engineers 60k starting wage right out of school with a masters no need for ten years experience…