Blog dogs west

It’s hard to imagine what else would happen when hundreds of people who read this blog gather in one room. Chaos. Too many bums. Too few chairs. Iconoclasts. Cynics. Doomers. Mouldy basement renters. The doubting. The hostile. Skeptics. Nutbars. Metalheads. Realtors. And, especially, the hopeful.

So last night was one small materialization of our virtual community. Every day we stare into screens together, with the brave 1% of readers flipping off messages they hope will resonate with others, or (even better) tick me off. Somebody punches up this pathetic blog now about six million times a year, but the nature of this medium means every single instance is a one-on-one experience. That’s why it isn’t TV. It’s personal. I sure feel it.

It’s easy every day for some people to try and dominate the blog with smartass comments or an attitude combined with sheer volume. Not so much when you’re one person in a sea of faces in a hotel ballroom. That’s as it should be. We’re all trying to find our way here. The immediate future is as scary as it is inevitable. If you don’t wake up some days cold and wet, you’re not paying attention.

Last night in Vancouver I told people the correction now decimating homeowners’ equity is real, and just starting. The 15% price correction and 30% collapse in sales foreshadows what is yet to come. By the time things trough the average price will likely be forty per cent lower, with a return to 2005 levels. The impact on people who bought in the 28-month delusional period between late-2009 and last March, when I told you what was coming, will be substantial. Maybe life-altering.

Nobody should be surprised. Van prices were wobbling with sales trending lower throughout most of 2007. The GFC shoved that into a ditch, before emergency interest rates and a weird it’s-different-here attitude created the most dangerous two-year period in Canadian real estate history. Local house-pumpers at first insisted BC was immune to a correction because of geography. Then the Olympics. Then because everybody wanted to move here. The crowning achievement was HAM, the largely mythical Asian invasion in which every Chinese-Canadian grabbing a condo was suddenly suspect.

As it turned out, of course, nobody’s immune. When people get maniacal and push asset values to unsustainable levels, telling each other their regional city is just like New York or London, the outcome’s always the same. Prices revert to the mean. And in Vancouver, that’s a 40% haircut.

Maybe more. It all depends on the local economy. BC’s allowed real estate and housing to become as big a part of the provincial GDP as it was in California in 2005, so as housing tanks there’ll be pressure on jobs and incomes. Meanwhile migration into the Lower Mainland is fading, since who the hell wants to move to a place where a shanty costs a million? Boomers from Mississauga and Calgary would be nuts to think they can retire in comfort when 100% of their net worth’s sucked off for a house.

The reasons Van real estate is crashing, and will continue to do so, are easy enough to understand. It’s unaffordable, even before mortgages get more expensive and harder to score, thanks to the feds’ war on the house. When average families can’t afford average houses in average hoods, then they correct, ten times out of ten. Valuations in the region have been built on debt, not rising incomes, with 92% of a typical household’s income now required to service the cost of a house. Nowhere else in North America is this the case. How can anyone be surprised?

Those who think they can tough out the slide are naive. If you bought in the last year, when the average SFH touched $1.2 million, you might die waiting to get your money back. And throughout this entire period, it will be renters who end up with the financial advantage, if they divert the massive amount needed to carry a house into liquid investments. The cost of renting in Vancouver (and approaching this point in Toronto) is half that of owning. So without capital appreciation, as I said yesterday, owners lose.

Most people can’t accept this, and won’t. While some people came out last night to challenge me, most came to find out when they’ll be able to afford a house. The emotional tug is simply too much. People think they need houses when they leave their parents. When they get married. When they get pregnant. When they have babies. When they retire. But they don’t. It’s a want, not a need. And right now, dangerous.

What we all require isn’t a house, but money. And while 70% of families own real estate, half of us have no savings. What the hell are we thinking?

The fact 1,200 people would trudge downtown to listen to me speaks volumes. But not about me.

I wish.


#1 El Padroni on 08.21.12 at 12:05 am

HHHW, is that u front row to right?

#2 Congrats Van! on 08.21.12 at 12:06 am

It’s different here in Calgary, we don’t have Turner.

#3 mark on 08.21.12 at 12:06 am

Audio? I missed you by a week.

#4 Rosebery on 08.21.12 at 12:07 am

I just got home from the big event and you’re already posting. Magnificent! Why not take some time tomorrow to enjoy our city.

#5 earlymidlifecrisis on 08.21.12 at 12:08 am

I’m sorry i missed it but will catch it next time i guess.

#6 Van guy on 08.21.12 at 12:09 am


Thank you so much for coming to Van!! I really enjoyed the show :)

#7 Min in Mission on 08.21.12 at 12:11 am

Wow, wish I had been able to make it!!

Looks like a great time was had by all. Unless you are a real estate agent, gold broker, house flipper, spekker, etc.

#8 David on 08.21.12 at 12:18 am

Nice presentation in Vancouver Garth. I liked it. Knowing the paper assets of things in stocks myself. I like your balanced portfolio of preferred shares/bonds/energy/REITs. Great way to preserve nest egg as you mentioned. Real Estate seems to be a dangerous asset class to invest in next 3-5 years.

I got a Q though with one area though you steered clear from. I remembered you mentioned precious metals, most notable Silver Bullion will not be a good investment. I follow other economists/managers on king world news- such as Peter Schiff, Jim Richards, Marc Faber, Steven Leeb, Rick Rule, John Embry, etc all seriously recommend Precious metals as a core asset in your portfolio. In fact, Basel banking rules now state gold to be a tier 1 asset starting Jan 1, 2013.

I was wondering did you not recommend precious metals from your part because its area that you’re not as familiar with? Or you don’t prefer yourself? With all these other major economists and George Sors investing in Precious metals, along with all the debt created from quantitative easing done, and history of failling fiat currencies, Precious Metals you’d think will need to be readjusted to higher levels as forecasted? History for example has made silver readjust to its traditional 16 to 1 ratio. What’s your take on the history of fiat currencies and the effect it has on precious metals? I include them in my portfolio of REITs/Energy/preferreds/bonds, etc.


#9 JR on 08.21.12 at 12:18 am

Thanks for coming Garth! Excellent presentation..
I noticed your Norton Antivirus is expired and your laptop is at risk –
Hope you enjoy our city!

#10 Leesa on 08.21.12 at 12:19 am

Thank you for coming to Vancouver and putting on this event. Much appreciated!

Thanks for the book too! :)

#11 Jan on 08.21.12 at 12:20 am

Excellent show mr;Turner and yes you look great and much younger in person and should start using your regular photo no earlier than 10-15 years from now,,,,cheers to you and thanks for the education. Chris

#12 Boombust on 08.21.12 at 12:21 am

Nice to meet you in person, Garth!

#13 EastVandal on 08.21.12 at 12:23 am

Thanks for coming Garth it pleasure to listen to you speak, thanks for the book.

#14 Larry on 08.21.12 at 12:23 am

Does Dorothy not like Calgary?

#15 Stuck on the Island on 08.21.12 at 12:24 am

Sorry I missed it. Just couldn’t get off the Island this afternoon, but I really wanted to be there to hear the message in person.

#16 Nodebt on 08.21.12 at 12:24 am

The chick That’s sitting front row to the left, in the black is pretty cute!!!

#17 Loon on 08.21.12 at 12:25 am

Great show and so many wise words with zero sales pitch. All on your dime, no corporate sponsors or shady plugs. Pretty funny to boot.

Much respect, you are the man !!!

#18 HD on 08.21.12 at 12:25 am

Thanks for the presentation. I really enjoyed it.

On top of everything, I won a signed copy of Money Road.

You truly made my night :)


HD (Herby D)

#19 ZRH2YVR on 08.21.12 at 12:27 am

#8. “In fact, Basel banking rules now state gold to be a tier 1 asset starting Jan 1, 2013”

This does not mean that it is an asset they should hold. It just means that if they hold that asset, it will qualify as Tier 1 as if it is cash. This is because Gold is basically a financial asset. It does not mean however that it is not volatile.

On a separate note, was out for dinner last in in Van with a Sr. Exec from an un-named large gold producer based in Van. He really just questions how long the high price of gold can continue and thinks it really does have the same long run fate as YVR real estate. . . . which is . . down by 40%.

Nice presentation tonight Garth. Very seamless delivery.

#20 Smartalox on 08.21.12 at 12:31 am

Garth, thanks for visiting, and for taking my question tonight, about matching asset classes to investment vehicles.

Full disclosure: the financial advisor who asked you a question tonight is the on-air financial advisor for… GLOBAL TV BC!

#21 Nodebt on 08.21.12 at 12:37 am

Hi gartho! I think I got my hot amazon convinced to read ur blog daily! If she lets me I’ll send u a pic of her in her bikini reading your blog!

#22 Monster Zero on 08.21.12 at 12:39 am

Great presentation tonight Garth.
Vancouver is upside down and f*cked in every way.
Your message and logic make complete sense and one would have to be blind not to see what is coming…
Thanks for being a voice of reason in a sea of stupidity…

#23 Controller on 08.21.12 at 12:41 am

I was there. It was GREAT!!
Thank you, Garth, and thanks to your colleagues that helped put on the event!!
Well done!

#24 mattymatt12345 on 08.21.12 at 12:42 am

Yup, was good tonight! Now i know what your up to! Many of the people in the room (including me) are sitting on stacks of cash from selling our houses at the peak and we need a good investor… I will be in touch…

#25 Toronto Market Watcher on 08.21.12 at 12:48 am

Price reduction bonanza in one of Toronto’s best neighborhoods:

January: $1,389,900
April: $1,279,900
June: $1,199,900
August: $1,149,000

#26 GUnit on 08.21.12 at 12:53 am

Great presentation Garth! Thanks for visiting Vancouver.

#27 Nostradamus Le Mad Vlad on 08.21.12 at 12:57 am

Are they all your followers / groupies?!

“Then the Olympics. ” — Pix of Athens Olympics sites (2004) How much did China and London spend? Any why did BC take a bath on the Winter Olympics? Guess this is what will happen at Whistler and the area soon enough.
Short Clip This is a nice musical show of Rita Hayworth and the Bee Gees ‘Staying Alive’.
A new workforce economy Based on service-type jobs (Cdn.); Financial Engineers and Govt. getting bigger, regardless who wins election; Soros Soccer whiz? Lending Spike Who wants to take on a mtge. during these days? Mongolia Like Af’stan, it’s loaded with natural resources; Good home inspections find water problems; Tight (no) Credit stopping consumers spending; Gold In My Sacks Sell stocks soon; Bernanke One person’s opinion; EZone Goofballs hand plate to Asia; Robots Replacing men, not women. We’re not good for anything (unplugging toilets excepted); Greece Fund Manager Boiling time soon; Home Ownership Costs froma US perspective; Robert Reich on R&R; US$11 mln. Ford used to make good products, and this was one of them.
Yaya Canada Bowing out gracefully; Shower Time unless it’s chocolate ice cream; Scott McKenzie pushing up the daisies at 73; Seven Products (probably a lot more) that will be finito soon; Syria and US desperation; Pix Bangkok University; Colombia Nice place to visit, and avoid the drugs.

#28 soho ne on 08.21.12 at 12:58 am

maybe its a sign,the better half is going to start reading this blob. 21ST!

#29 Surrey Girl on 08.21.12 at 1:07 am

Enjoyed myself tonight. Hubby and I hopped into the electric car and trekked downtown. Thanks for coming. Some questions though. I believe you have said the future price trend of real estate can not be predicted by the price trend of the recent past. If that is the case then your graphs tonight showing the trend of the TSX over the last three years would seem to be a similar argument predicting future prices of the TSX. Q: Are stocks a different asset class and therefore safe to predict based on trends of the immediate past? Q: If trends of the immediate past are not a good predictor of either asset class then what criteria would you suggest? Thanks again.

#30 cj on 08.21.12 at 1:10 am

Thanks Garth for giving a well organized & humorous presentation. You gave us explicit examples of how to create a balanced portfolio.
We can’t run from the charts that make it so obvious that Vancouver/Lower Mainland will correct severely. Good thing you had all those humorous pics to balance the real estate and stocks charts, otherwise we would have had to pass around the kleenex

#31 Yellow Helicopter on 08.21.12 at 1:12 am

@smartalox- thank you for asking that question – my friend and I appreciated it!
Garth, thanks for hosting the evening and for the informative session.

#32 Not 1st on 08.21.12 at 1:17 am

Garth, don’t you feel a little weird going on that Money Week radio show? They always bring on some extreme guests. The last two times you went on there they brought some doomer on after you. First guy said gather your gold and head for the hills. The next one called for end of fiat currency within 5 years.

#33 Poorboy on 08.21.12 at 1:19 am

My favourite part of the event: the self-professed financial advisor in the audience who didn’t get where the downward pressure on prices would come from since he wouldn’t sell his million dollar home for 300,000 less.

I wish he disclosed who he worked for, so we could all avoid dealing with that company for hiring such moronic financial advisors.

#34 Poorboy on 08.21.12 at 1:22 am

Also, not to be creepy (but it’s going to be), Leesa should be one of your Amazons – she qualifies on all counts.

#35 Alberta Ed on 08.21.12 at 1:22 am

Here in sleepy Sidney-by-the-Sea (land of the newly-wed and nearly-dead), I’m told by locals that many people (these would be the nearly-dead) have taken their properties off the market until it ‘recovers’. I suspect they are counting on resurrection.

#36 Ravishing Rick on 08.21.12 at 1:25 am

I lost my soul at Garthapalouza 2012!!!

#37 Mackie on 08.21.12 at 1:35 am

So that’s what all you Greater Fools look like. lol

#38 FTP - First Time Poster on 08.21.12 at 1:36 am

No doubt CSIS has uploaded the audience pic & is running it through their facial recognition software to add names to their “Doomer” dossier.

I jest. Time for Edmonton Garth. Its been over 3 years hasnt it?

#39 Soylent Green is People on 08.21.12 at 1:36 am

Great pic

Hope you warned them about the corporate puppet Stephen Harper


#40 BC Citizen on 08.21.12 at 1:36 am

Garth, you are the freakin’ man. A man of all mans. The greatest man to destroy the greater fools. Your presentation was top notch world class, the best of the best. That presentation would send all the greater fools home crying thinking their home in the best place on earth is just another piece of crap unworthy to be stepped on & looked at, but they are stuck with it falling in price to eternity. What would be great is a depreciation of around 60% & greater for those foos, not just 40%. Let them suffer…

#41 An Cat Dubh on 08.21.12 at 1:49 am

Enjoyed hearing your short radio interview Sunday morning. You also mentioned Penticton as a decling market. I seen a young early 20s realtor there with a reletively new Audi that he has to pay for. If anymore “bad” news comes his way he will have to return it(and buy a crappy Dudge Neon) and maybe get a job as a sandwich artist and possibly get a loan to go to college.

#42 Enlightened on 08.21.12 at 2:07 am

Thanks Garth for the presentation, informative and entertaining as always!
Nice to meet you in person!

#43 Tony on 08.21.12 at 2:08 am

Without a doubt anyone that bought Vancouver real estate last year will die of old age before they ever see last years’ prices again. It could be much longer than a century before those prices return again.

#44 Devore on 08.21.12 at 2:08 am

#20 Smartalox

Full disclosure: the financial advisor who asked you a question tonight is the on-air financial advisor for… GLOBAL TV BC!

It sounded like he did not quite grasp the concept of balance and holding assets that are not correlated, when he asked why anyone would want to buy bonds. Most amateur (and very likely professional) investors do not understand the concept of risk, risk management, hedging, and risk adjusted returns. It’s perfectly fine to shed some portfolio growth to gain some stability and safety, depending on your tolerances.

We see this kind of ignorance on this blog every day when people cheer on their paper gains in a highly leveraged (95%) investment. When the downside hits of course, they will be back here whining about how the rich are fleecing the middle class.

#45 RedCorvette on 08.21.12 at 2:10 am

Hey, that dude….second from the left in the first row……..did you ever work at Shaganappi Chev Olds in Calgary back in the late 80’s, maybe early 90’s? I think you worked on my Vette!

#46 Zoronqueen on 08.21.12 at 2:10 am

Glad to have missed the sweaty blog dogs but sob did miss the “Garth”.

Glad to have seen you in surrey a few years back without the 1200 crowd.

Anyways keeping the house in Edmonton but renting in Vancouver. Hope to see a correction in the next year or so, in the oakridge area….

Keep preaching the housing doom… We all need it….

#47 CoreyMc in Calgary on 08.21.12 at 2:10 am

Now there’s a bunch of pathetic people! In a good way. Being from White Rock and now living in Calgary, I was expecting a lot of metro-hippies. Glad to see everyone had a good time and hope you sold your houses like me;)

#48 Ryan Perich on 08.21.12 at 2:17 am

to David #8.
“History for example has made silver readjust to its traditional 16 to 1 ratio”.
Harold Seagal states this many times on his radio show. it was a 16:1 ratio for a very short period of time measured in months in the last 50 years.
almost other times it’s been about 50:1 – including the early 2000’s. I bought in during the 16:1 hype back in 2011 when silver was $50 an oz with gold at 1900, 38:1 ratio, and as Garth says about the housing market : it always, eventually returns to the long term mean. (and I think a 50 year average is a pretty good mean to live by – you won’t live much longer than that after you turn 18)
in this case, for gold : silver ratio, that number is 50, not 16. going back thousands of years has , I think, little bearing on the next 50. all eggs in one basket = bad, and Garth hasn’ t suggest on his blog holding no precious metals – he just downplays the need for a certain % worth that others boast as needing 10% or more.

#49 Devore on 08.21.12 at 2:22 am

#33 Poorboy

His house question was indeed even worse than his bonds question. He does not seem to understand how a market works.

If your neighbor sells his million dollar house for $700,000, guess how much your comparable million dollar house is worth now?

I sure hope he was joking about being an investment adviser. Probably just shills mutual funds for a bank.

#50 cynically on 08.21.12 at 3:06 am

Congratulations to you and your partner for a knowledgeable delivery in an understandable fashion using the visuals – makes your points clearer and easier to remember. Enjoyed it much.

#51 GTA Girl on 08.21.12 at 3:18 am

Come home Garth.

Ontario needs a seminar too!

#52 Buy? Curious? on 08.21.12 at 3:41 am

Garth, I’m glad you were able to help all those people. With information scarce or worse, bias, it’s important for some people to search out a difference of opinion. Now if you could just assist them with their fashion sense. A mullet? Floral print dresses? Blazer with sandels? Talk about reinforcing the Canadian sterotype. The crowd looks like extras from The Trailer Park Boys.

Nickleback is the best band evah!

#53 Chaddywack on 08.21.12 at 4:03 am

I wonder if BPOE showed up?

#54 TaxHaven on 08.21.12 at 4:06 am

“What we all require isn’t a house, but money.” – Garth

Careful with blanket statements. For that assertion to be entirely accurate, assets other than currency itself or yield(currency)-producing investments won’t cut the mustard. They aren’t “money”.

But nearly anything CAN be a store of value. Depends on the price. Isn’t a Vancouver house purchased years ago for $200,000 or thereabouts “money”? Or stocks purchased in March 2009? Or gold purchased any non-peak time? What about about soybean futures acquired three months ago?

What people need isn’t more currency, but a house – or anthing else – purchased at a reasonable price.

They need investing acumen. Or speculative savvy…

#55 Rob now in Nova Scotia on 08.21.12 at 4:55 am

Garth, I’ve been to 3 of your talks (London, Halifax and Lunenburg) and all 3 events were filled with grey haired old people. The pic shows a decidedly younger crowd. Is that just Vancouver or is this a new paradigm?

#56 Freedom First on 08.21.12 at 5:09 am

Garth, congratulations on you successful show in Van. tonight. I live in a major city in Canada, as you know, and I really look forward to seeing you live:)……Thanks for your work you do Garth, and your great, amusing and always enjoyable humor. You are appreciated:)

#57 P & T S on 08.21.12 at 5:13 am

Seems “The Good News on the Economy” might not be so very good after all –


and particularly

But it seems that “Our Masters” have their own plans . . (which don’t include the rest of us!)

As Nostradamus le Mad Vlad has said in the past, “We sure live in “Interesting Times”!!” Personally we’d be quite happy to live in far less interesting times, but that’s life!

Oh, and remember the EU’s stuffed too! –

It’s getting to stage that a liferaft seems a better “home” than a house right now!

#58 Freedom First on 08.21.12 at 5:13 am

Congrats on your show tonight Garth! Looking forward to seeing you myself when you come to our city. You are much appreciated Garth! Thank you for all you do, and for your one of a kind pathetic humor…….love it:)

#59 I'm stupid on 08.21.12 at 6:10 am

I must be the salt in the pacific that intoxicates west coasters into believing that it’s diffrent there.

On a side note, did the photographer use an 80’s lense to take that picture? Why does it look like the 80’s?

#60 Smoking Man on 08.21.12 at 6:13 am

Looks like a sausage fest. Cute one in the black on the left.
Mind you can’t find my glasses.


If one embarks on getting completely loser wasted just as you hand your car keys to someone, you should also unload all communication devises.

The world after the 3rd glass, can’t even describe what things look like after 15
Been suffering a 3 day hang over from consuming litre and a half of wine, and lost count of the amount Grappa shooters in very short time frame.

Also wear a helmet and avoid walking to close to hotel hallway walls that have protruding light fixtures at approx. head level.

I have absolutely no idea what I said on Garths blog that got me deleted, but thanks Garth.

Unfortunately , not having a censorship board managing my emails, and facebook posts well all I can say is I’m in the dog house yet again with the Fan-damily.

When that third eye comes out broadcasting things that are true that you should never say. Well shit happens.

Pointing out truths is far more dangerous than lying. Remember that kids.

So to all the butt kissing- Gartho- hero worshippers that chirped me on the weekend.

You will never learn the Move.It was going to be my next gift to you cowardly never risk a thing pretend armchair investors.

O and on RE in the GTA look at prices in London England (especially you LaughingCon)

Anyone have a link?

#61 Astute Poverty on 08.21.12 at 6:19 am

Here’s a real life story:

#62 TurnerNation on 08.21.12 at 7:48 am

Who was first/Furst at the Vancouver event?

And who got to annoint his feet? Lucky so-and-so.

#63 T.O. Bubble Boy on 08.21.12 at 7:57 am

Ironically enough, Vancouver is likely one of the cities that won’t need presentations to tell it when the RE party is over…. The for sale signs and falling prices are rather obvious.

I’m curious – did anyone reference the HPI frankenumber? It is still going up up up after all.

#64 Gypsy Kid on 08.21.12 at 8:01 am

Garth, you really should start writing fiction…you’re such an entertaining writer.

#65 question on 08.21.12 at 8:07 am

just curious…what is the estimated composition of the audience stratified by age brackets?

25 and under
over 51

#66 Victor on 08.21.12 at 8:12 am

Royal Bank of Canada is raising two of its mortgage rates by one-fifth of a point each, starting Tuesday.

RBC’s posted rate for a three-year, fixed-rate mortgage will go up 0.2 percentage point to 4.05 per cent.

Meanwhile, an RBC special-offer rate for five-year closed mortgages rises to 3.69 per cent.

#67 JL on 08.21.12 at 8:24 am

when will you come to ottawa to share your wisdom?

#68 expat_engineer on 08.21.12 at 8:42 am

#48 Ryan Perich

“almost other times it’s been about 50:1” …

starting since which year?

See below.

#69 Leesa on 08.21.12 at 9:16 am

re #34….creepy

#70 House Horny Housewife on 08.21.12 at 9:20 am


You really hit the nail on the head. Half of us have no savings. I would even venture to add that those who do have savings don’t have enough. It will be interesting to see what happens in the future.

Perhaps the ability to save should enter into the equation when a bank is approving a mortgage loan. I think they mostly look at your capability to pay the mortgage and your general expenses but they do not take into account the fact that you will eventually retire. Of course if you have paid off your mortgage by then, they shouldn’t care, should they ? However, many people will still be paying off their mortgages during retirement so why wouldn’t this enter into the equation ?

Perhaps we need to publicize what percentage of your income should go toward housing and what percentage toward food and expenses and what percentage should be put into savings. Budgeting is never in the spotlight and hasn’t been for quite some time now. It is too boring and “unsexy” for most. Much more exciting to run out and buy that beautiful house or that gorgeous sports car on a whim rather than budgeting for it .. that’s too “passé”.

I forsee an eventual return to what our grandparents taught us (that’s great grandparents to many of you). And when we get fed up with that, we will again return to our hedonistic spending ways, until the pendulum swings too far the other way again. When will we ever learn that everything in moderation is the key to good living ?


#71 Toronto_CA on 08.21.12 at 9:27 am

#60 Smoking Man on 08.21.12 at 6:13 am
“O and on RE in the GTA look at prices in London England ”

Why on earth would anyone compare the GTA to London England? I can’t for the life of me understand that comparison. Chicago, Illinois is an apt comparison (though I like Chicago better in a grass is greener kind of way), and prices in Chicago are quite reasonable.

#72 DonDWest on 08.21.12 at 9:29 am

#33 Poorboy

I wouldn’t expect too much from financial advisors. After all, what does someone who must attend a communist group think gulag, known as a Canadian University, know about finance?

#73 DonDWest on 08.21.12 at 9:42 am

#55 Rob now in Nova Scotia

Don’t know about London, but as for Nova Scotia, that’s because in Nova Scotia you’ll be lucky to see anyone under the age of 50.

We do have the young international students, but they’re not the type that would frequent Canadian financial seminars. Considering the fact most don’t even intend to live in Canada; and plan to move out the moment they receive their education.

#74 Stepen Harper on 08.21.12 at 10:10 am


Nice presentation last night.

ps: you are still fired

#75 eaglebay - Parksville on 08.21.12 at 10:16 am

#71 House Horny Housewife on 08.21.12 at 9:20 am
“Perhaps the ability to save should enter into the equation when a bank is approving a mortgage loan. I think they mostly look at your capability to pay the mortgage and your general expenses but they do not take into account the fact that you will eventually retire. Of course if you have paid off your mortgage by then, they shouldn’t care, should they ? However, many people will still be paying off their mortgages during retirement so why wouldn’t this enter into the equation ?”

We blame the government for our troubles.
Now we want the banks to run our financial lives by telling us how much to spend and how much to save.
What a world.
Maybe our education system is failing us.
Who cares about Shakespeare.
If it’s not too late, we could teach our kids to think for themselves, to do research, to learn on their own, read and not assume that the teachers are always right and know it all.
There’s so much information available nowadays.

#76 Angel on 08.21.12 at 10:27 am

Thanks to you, Garth, and Scott for hosting the event last night. Enjoyed it very much.

#77 torontorocks on 08.21.12 at 10:27 am

#72 I love when people compare us to London or Paris or Moscow even. New York North is another favourite of mine and I fully agree and have referenced it in the past, Chicago is our closest comparison and houses in exceptional areas are extremely reasonable there compared to here. There has to be normalization. Will Rosedale come down to $900,000? I’m not sure if it ever did. You’ll always pay up for quality but runnymede and bloor? South Kingsway? Not likely sustainable.

#78 Peter on 08.21.12 at 10:34 am

#60Smoking Man on 08.21.12 at 6:13 am
“Looks like a sausage fest. Cute one in the black on the left.”

Did you Just came out from prision.?..just a regular chick…

#79 OnlyTheBankersLaugh on 08.21.12 at 10:48 am

#60 Smoking Man on 08.21.12 at 6:13 am
So to all the butt kissing- Gartho- hero worshippers that chirped me on the weekend. You will never learn the Move.It was going to be my next gift to you cowardly never risk a thing pretend armchair investors.

O and on RE in the GTA look at prices in London England (especially you LaughingCon)

Our mythical Smokin’ Man,

On the MOVE, which awesome MOVE is that? Is that the buy the hooker when the wife passes out MOVE? Or the totally drunk know it all arrogant loudmouth MOVE at family party speaking your version of the truth? Tell us, oh mighty Floyd loving, booze swilling, fattie smoking sherpa of Mimico, the ol’ lie, steal and cheat MOVE again to teach our kids? Forget that crap about character, confidence, integrity and skill sets. Please enlighten us poor military industrial complex tax farm slave losers who need your guidance.

Your universe may seem to be shrinking but, just like every universal constant infested equation, it depends on your state and point of reference. High energy, low energy, high mass, low mass, speed, time with a splash of delusion from booze, hookers, strippers, dope and Floyd. Depends on perspective/reference.

Your Smokin’ fantasy blogging must be stopped. You are too popular for your own good. You will have too followers at the Casino and Lake Couchiching. Mimico streets and GO Trains are full of dreamers trying to locate the SmokinMan cache. Please tell us about your fantasy hockey playing and coaching days? I imagine those stories should provide great content and fiction for several book. Can’t wait.

On Toronto vs London, really, Smoker? Mimico with all its GO Train popping charm is not London unless you we’re comparing London, Ontario. If you believe, I hope you are putting your money where your mouth is and you are buying like crazy as the ultimate contrarian. Step up to the plate and let it ride on Mimico, Smokin’. You will be our complete and utter cartoon hero if you’re right! Men will weep, children will twitter every word and women will rip their togas off in lecherous lust.

And relax on Laughing Con/ Realtors in a Panic. It doesn’t look good on you to quibble in these petty fights. You are so much better than that as a fictional 60 year old character.

Your Loving Fan,
Only The Bankers Laugh

#80 Oceanside on 08.21.12 at 10:49 am

Watched Global BC News this morning to see if there was anything about the Vancouver event and wasn’t suprised to see nothing about real estate except “Sales at former Olympic Village are picking up” I am continually amazed at how this station presents “news”

#81 wrong on 08.21.12 at 10:54 am

#61 Astute Poverty on 08.21.12 at 6:19 am

Oh please! Why are they making babies then? Can’t they wait until he is finished, this is poverty by choice. It’s an epidemic of stupid. Go get a life!

#82 Canada Watchdog on 08.21.12 at 10:56 am

GTA New Home Sales Plunge 19.5% y/y. Toronto 416 high rise sales down 17% y/y. BILD Report

#83 Van guy on 08.21.12 at 11:00 am


You said last night that junior companies will lead the way with growth. But you don’t buy stocks. So where do you achieve this exposure with ETF’s? I only know of the bmo junior gold and oil. Those look scary to buy.

There are several ETFs, like XCS, that give exposure to small-caps. — Garth

#84 debtified on 08.21.12 at 11:25 am


JR in #9 said your Norton Anti-Virus has expired. Unistall it and install the free Microsoft Security Essentials:

Fort McMurray RE Average Prices:

Date Single Family Multi Family Duplex
Dec-10 $685,970 $419,422 $443,786
Jan-11 $719,305 $395,488 $489,233
Mar-11 $705,835 $430,461 $503,400
Apr-11 $729,048 $441,075 $534,230
Jun-11 $746,315 $425,503 $530,544
Jul-11 $740,266 $416,630 $508,211

Nov-11 $755,181 $408,005 $512,235
Dec-11 $729,092 $387,244 $550,983
Jan-12 $724,209 $392,261 $618,700
Feb-12 $755,756 $458,089 $543,000
Mar-12 $774,538 $403,590 $543,545
Apr-12 $737,412 $388,512 $526,030
May-12 $771,419 $442,178 $530,929
Jun-12 $759,501 $429,193 $482,625
Jul-12 $758,506 $484,849 $543,488


#85 Keith in Calgary on 08.21.12 at 11:26 am

I am sitting here in YVR right now, got sent here for a week long bizz trip.

Yesterday while walking down West Broadway in search of a place to have lunch, I made the following observation after settling into a chair at Fatburger.

Never before have I seen a city where sooooo many people are on the streets during the middle of the afternoon, they appear to be unemployed and without any visible means of support, yet they can buy a $20 burger and fries. Odd that……..other than RE flipping and drug money, what else has YVR got for an economy ?

Lots of for sale signs out there during my drive around town……WOW.

#86 Randy Fortin on 08.21.12 at 11:32 am

Great discussion last night and a wakeup call for those who have been dreaming of low Mortgage rates and high inflated home values as a panacea for the poor showing in the economy. Even the overly confident need to have their trees shaken from time to time! Thanks for the book, it will be well read by myself and especially my children who were thinking that NOW is the time to buy in Vancouver!

#87 OlderbutWiser on 08.21.12 at 11:43 am

Devore #44 wrote “It sounded like he did not quite grasp the concept of balance and holding assets that are not correlated, when he asked why anyone would want to buy bonds. Most amateur (and very likely professional) investors do not understand the concept of risk, risk management, hedging, and risk adjusted returns. It’s perfectly fine to shed some portfolio growth to gain some stability and safety, depending on your tolerances.”

Devore, there can be a great deal of risk involved in holding bonds if you do not plan to hold to maturity. When interest rates rise the value of the bonds will fall and given where rates are today, there is a strong risk of losses if you plan to sell before maturity. Perhaps this was the point that the individual was trying to convey.

You miss the point. It’s all about weighting within a proper asset allocation. Why do you care if the capital value of a bond holding falls slightly (interest rates will rise very, very slowly) if it is 12% of your portfolio and provides a useful hedge and stabilizer against growth-asset volatility? Any balanced portfolio should have corporate bonds, government bonds, real return bonds, high-yield bonds, REITs, preferreds, trusts and a diversification of ETFs. The point is not to have everything always rising together, but to achieve a balance which frees you from the tyranny of daily market gyrations. — Garth

#88 Just Park It on 08.21.12 at 11:46 am

One of the poster’s in here said they can’t wait for homeowners to get stepped on ? .. WTF are you on – why the hate.

I own, because for once in my life I have finally saved for something then spend like a drunken sailor. I bought and now I have this home – and its just that, a home. It took a forced savings for me to finally build on something – renting was neither a good or bad thing – we all need shelter – some understand this concept and others will always try to manipulate it.

70% of Canadians currently own homes – and yes, a percentage of those should not have been homeowners to start with on the finanical aspect of things.

If GDP is fueled by consumer spending – and with the poster hoping that homeowners get stepped on – just try to picture what our entire economy will look like. I work directly in this industry and I will tell you that everyone of my clients will slash all expenses before defaulting on their mortgage payments, even going as far as falling behind on property taxes –

Some people who post such BS are pathetic – we as a nation need others to be successful and we all reap the rewards – if they want people to be hurt financially, then it’s just a matter of time before we blast back to the stone ages and lets see how we are doing then.

Some people here have to grow up – and worry more about themselves and stop blaming the world for their problems. Missed the boat on purchasing – suck it up – the boat always returns.

#89 DonDWest on 08.21.12 at 11:52 am

“#76 eaglebay – Parksville”

“If it’s not too late, we could teach our kids to think for themselves, to do research, to learn on their own, read and not assume that the teachers are always right and know it all. . .”

Corporate capitalism doesn’t pay you to think that way. . .

#90 Wudeva on 08.21.12 at 12:02 pm

Hi Garth,
I traveled an hour and a half to get to see you speak – and it was worth every minute!

Can you PLEASE post some of your presentation slides – especially the ones showing balanced portfolio elements (and the Amazons)?
Thanks much!

#91 Guan-Di on 08.21.12 at 12:15 pm

#82 Wrong:

Nail. Head. BANG!

I would almost feel sympathy if they were both first time parents who were 18 and clueless as to how much kids cost, but they both have kids (one a teenager) from previous relationships… words can not describe the stupid!

#92 VINNY on 08.21.12 at 12:15 pm

REF. #51
Come home Garth.

Ontario needs a seminar too!


#93 bigrider on 08.21.12 at 12:30 pm

A simple observation.

In no way will the next ten years will look the same for real estate as the past ten did.

In no way will the next ten years look the same for financial investments as the last ten did.

#94 JULNICAN on 08.21.12 at 12:34 pm

#86 Keith in Calgary:

Carioca Canuck aka Keith in Calgary: as a car salesman how many folks you have to lie to in order to make a living?

#95 Graham on 08.21.12 at 12:38 pm

#73: “a communist group think gulag, known as a Canadian University”

Oh, seriously. Get a grip. Been in academe for twenty years and never met a single authentic communist yet. Met a few fascists, though. Legit, full-blown, hard-core fascists. Guess which party they vote for?

#96 Mister Obvious on 08.21.12 at 12:42 pm

#89 Just Park It

“Some people here have to grow up”

I wouldn’t hold my breath…

#97 Alex N Calgary on 08.21.12 at 12:45 pm

LOL about all the people wandering around Vancouver who seem to have no jobs, isn’t that the truth? Garth can you put on some specs about when you buy the house for less money after a correction, how much money you save in interest by shortening your amortization on the lower house price? I find thats the real #’s, how much money a 30yr mort costs in interest, and how much you can save @ 15yrs instead, making the same monthly’s on a house that just had a 30% correction.

Vancouver is the first, look forward to you visiting CowTown once things start to head the direction of Vancouver, my guess is that oil (gas is already shot) is going to take a violent turn within the next yr and it’ll be lights out for jobs in this city.

All these damn jobs where people have no education and make 60-100k doing construction, flooring, oil and gas drudgery…all outta work, all with 15k Quads, 80k trucks, 50k trailers and 800k houses

#98 deja view? on 08.21.12 at 12:47 pm

The invasive species where I live isn’t ‘broom’ as many would have you believe. Nevertheless there is a vociferous movement afoot to rid us of this plant that is taking over the SS coast.

As it turns out, broom is really a metaphore for the mass migration of Ontarians and Albertans to my fine neck of the woods.
Never having been much of a green thumb in the past, I now agree.. get rid of the broom!

#99 DM in C on 08.21.12 at 12:52 pm

Just Park It

“I work directly in this industry and I will tell you that everyone of my clients will slash all expenses before defaulting on their mortgage payments, even going as far as falling behind on property taxes – ”

Uh huh. Common myth about Canadians. When the rubber hits the road, the jingle mail will resonate loudly. Fall behind on taxes rather than the mortgage? Right.

But you have a vested interest in keeping the balloon inflated — sounds like you’re a mortgage broker — so your opinion is moot.

#100 Justsayin on 08.21.12 at 12:53 pm

I hope the guy in the front row sitting beside the girl in black didn’t get his Camaro towed while he was at your event. Must have cost quite a bit of gas money to make it all the way in from Maple Ridge. Sad I missed the show Garth. The Victoria Conference Centre is ready when you are.

#101 Mithan on 08.21.12 at 12:58 pm

I don’t understand how REIT’s for commercial property is a good thing when you expect a housing collapse.

Can one not assume that a housing collapse will probably cause a recession, putting pressure on business which leases Commercial property, thus hurting those REIT’s?

No. — Garth

#102 David on 08.21.12 at 12:59 pm

That 1200 people showed up for a discussion on the housing bubble sounds like some type of tectonic plate movement or revolution.
The soft landing and balanced market crowd could barely fill a Toyota Echo these days.
Homes as an investment vehicle promise a very unhappy future and so do ghost condos in the sky.There will not be any emergency interest rates when these mortgages reset and there will not be some principal reduction fairy waving a magical wand when mortgage holders find themselves underwater.

#103 futureexpatriate on 08.21.12 at 1:03 pm

Why aren’t you Prime Minister yet? America’s ditched Cheney and the conservative nutcases long ago, and that party is almost extinct in America. November is a done deal, and after that, 2014, 2016, et al. The 1% have thrown away billions for nothing. Canada needs to catch up.

#104 bill on 08.21.12 at 1:07 pm

#84 Van guy on 08.21.12 at 11:00 am
Thanks for asking the question. And thanks Garth for answering it.

#105 Just Checking on 08.21.12 at 1:07 pm

Smoking Man, welcome back!

#106 truth hammer on 08.21.12 at 1:07 pm

Sorry I missed the dog and pony show G…..the bug lights in the garden were especially active and I couldn’t break away. I’m always surprised that you have decided to take the politically correct stand on HAM and side with the deniers…..good for you….the eveidence we see all around us is not really happening…the reports out of the free global media are incorrect and rascist…..I get it. Sorry…but I gave up sniffing my own bum in infancy…..some never break the habit and go on to become Liberals.

From the look of the crowd you sucked the valley clean….this is the crowd I think is in especially big trouble this time around……they have bought high and don’t have the earning power to stay out of the price trap that has been set for them. A professional has the wherewithal to declare bankruptcy….these fools are screwed to the mat. And BTW…these are the types of people who drive hours for a monster truck rally …’s not as if you faced the cream of the crop by the looks of it.

These are people who are currently underwater and sending their kids to school hungry….grandma’s in the bsmt shivering…….and with two SUV’s in the driveway on lease times are going to be lean come winter.

Food costs are continuing to skyrocket….of course the deniers will refuse to mention ‘hyperinflation’ but the facts on the ground prove it out.

You often posit a marginal increase in carry cost being the 4th horseman of the real estate apocalypse…..what about a 20% rise in food costs…transit costs….gas…etc p/a?

Those who say that my views on inflation are too extreme are either living with Mom, working for the Liberals……or don’t realize that things are even worse than I say………

Must suck to be you. — Garth

#107 Victoria Tea Party on 08.21.12 at 1:13 pm

Into the Valley of Death rode the 1200…!

It wasn’t exactly the a re-do of the Crimean War’s ghastly Charge of the Light Brigade.

INSTEAD it was a moment of sanity in a city that’s been too insane about real estate “that always goes up” for lo’ too many years.

Chickens and Black Swans are fighting for roosts (!) atop greying condo towers as they all begin a winters-long “nest-in” (Vancouver’s hippies used to have “be-ins” in the 1960s! these now-aging Boomers will be calling them Depends-ins!).

Garth, the effect of your chat being held in the Nuttiest Real Estate City in Canada has been akin to a jolly good dose of salts, and a few other medicaments from centuries gone by, for the real estate “elites” there. I hope they took note of the interest, see where this all may lead to, and how they will be affected by their past behaviours especially towards financially-strapped former clients, soon to be real estate road kill.


…OR, maybe some of this berg’s debtors will ACTUALLY up and take notice and then do something about squaring things away before they hand off a simply ghastly tureen of monetary soup to their successors.


…Save the last trick for me, is what is more likely even if they’ve run out of sleeves from which they’d hope to pull out that last trick!

What is it? Why, run to the guvmint, even by those who’ve got whacked by bad real estate investments. Why not? They’re entitled!

Canadians always marvel at why Americans “always” come up with good ideas before we do.

That is why some of our fellow boomers and others must be ecstatic about the latest form of the Yankee Doodle Dandy “new idea”.

It is outlined in this op-ed from a recent issue of Forbes magazine from last week.

In essence more than half the US population is needing some form of government dole.


…to oft-seen comments on this blog that “Americans will be able to work their way out of this current malaise.” I say nonsense, always have, and this is another clear support for my opinion.


“…New research…reveals that…more than 107 million Americans (are) on some form of means-tested government welfare.

Add to that 46 million seniors collecting Medicare…and 22 million government employees at the federal, state, and local level — and suddenly, over 165 million people, a clear majority of the 308 million Americans…are at least partially dependents of the state.

Since President Obama took office in 2009, eligibility for Medicaid, food stamps, the earned income tax credit, the making work pay tax credit, and unemployment benefits has increased by roughly 10 million. …….

But it’s even worse than that. In fact, most voting-age Americans do not pay income taxes — approximately 50.6 percent.

That includes 53.91 million Americans who pay nothing in income taxes, and another 64.7 million who get refunds in excess of what was owed. That’s 118.61 million out of 234.6 million Americans 18 years and older…”

If you check later in this article, about the fall of the Greek Empire eons ago, eventually democracy morphes BACK into tyranny.

So, bless ’em all who showed at Garth’s show-n-show in the Village by the Edge of the Rain Forest.

May those good people escape the Grip of the Zombie Classes and make their own, responsible way through this life.

#108 vic_guy on 08.21.12 at 1:28 pm

@ Smoking Man # 60

Are you this same Smoking Man ? I thought you said you were in IT or something other than real estate ?

“Avoid the coming real estate correction in Canada and diversify your real estate portfolio before it’s too late. These are the lowest prices for real estate in the US in 40 years! Buy value now in the US, like the rich are doing!

We’re seeking 50 cash investors with a minimum of $100,000 and up to invest in this value oriented investment.

If you’re interested send a note to the email address below with your name and phone number; we will contact you.

[email protected]

#109 Bob on 08.21.12 at 1:38 pm

Garth, please expand on your Vancouver predictions:
40% average decline from peak does not get us to 2005 levels. (At least, I don’t think so).

So what levels does it take us to?

#110 nufio on 08.21.12 at 1:39 pm

I asked at the event about investment vehicles that will directly benefit from the real estate prices plummeting across canada. You suggested holding REITs which hold apartment complexes or commercial buildings. In the US when the real estate bubble crashed, the REITs were creamed. Why do you think it will be different here? Are there no inverse ETFs that can go up with exposure to real estate? if there isnt, i wonder why no one is creating one.

Get your facts straight. Good US REITs rewarded investors. Besides, this ain’t America and the housing correction will not crash non-residential entities. — Garth

#111 bigrider on 08.21.12 at 1:45 pm

Regarding today’s picture.

You could have cleared the chairs out of the way, turned on some music , had a dance afterward and maybe, just maybe, we would have had some people ‘make friends’ afterwards.

#112 Sollbruchstelle on 08.21.12 at 1:49 pm

Thanks for the event, Mr Turner, classy all around!

I used to have a rabbit-in-the-headlight approach to personal finances, reading your blog has triggered me to get active. I might still suck at personal finances, but I do so … actively.

#73 DonDWest
I wish people like you would stop throwing around words they don’t understand. I suggest living abroad for a bit (and no, crossing the border to the US a few times a year does not count), to get a better grip on politics. But then again, I guess that’s not what you’re after anyway.

#113 Ryan Perich on 08.21.12 at 1:57 pm

to #69 engineer for gold: silver price ratio
from your own link

1930 : 50:1
1940 : 100: 1
1945: 80 : 1
1950 : 40 : 1
1955: 40 : 1
1960 : 30:1
1965: 20 :1
1975: 30:1
1980: 30:1
1985: 40:1
1990: 60:1
1995: 60:1
2000: 70:1
2010: 38:1
2012 : 55: 1

in 1965 it was about 20:1.. that’s about it.
the 16:1 gold:silver hype, even WITH charts, people ignoring it is bad.
if a simple chart going back 80 years proving the opposite of what’s being said….omg what are people thinking without proper charts of housing vs income !

#114 Outtahere on 08.21.12 at 2:07 pm

Can’t believe how rude people are commenting on the people in the photo…you have no idea where these people come from, what they do for a living or how much money they have/don’t have. Post your picture and let us make stupid remarks about your life.

I was there and I can tell you it was an all ages show…everyone from young 20 something’s to retirees. It was nice to see.

Good job Garth…I have been reading you and having a good laugh everyday for years and am glad I saw you in the flesh.

#115 Junius on 08.21.12 at 2:18 pm

#90 DonDWest,

You said, “Corporate capitalism doesn’t pay you to think that way. . .”

Amen. It is so true and so sad. People are not taught to think but to become functionaries and conformists.

I have been asked by a University to provide a series of lectures on a subject that I am an expert in. I did an outline of the topics which included a heavy dose of theory followed by the practical. I was told to scrap the theory portion and just focus on the “practical.”

I objected by saying that without theory and grounding in the history and the principles the application was not nearly as valuable. I was told – very clearly – that “practice ready” was the goal of the institution now.

This is a huge problem in our society and it is accelerating. People know there is a problem but they don’t know how to evaluate the issues never mind come up with the solutions. Increasingly the system – corporate capitalism – pushes out all competing ideas and notions. Dissent is now quickly marginalized and any real political choice a mere fiction. Scary.

#116 The Greater Fool – Live in Vancouver « Harderblog on 08.21.12 at 2:26 pm

[…] 2012 predictions offered back in December here.  His summary of last evening is available here. Share this:TwitterFacebookLinkedInLike this:LikeBe the first to like […]

#117 Keswickian on 08.21.12 at 2:40 pm

#89- just park it

Fall behind on property taxes and the city holds an silent auction to sell your property. Minimum bid starts at what you owe in taxes.

Fall behind in mortgage payments and bank sells your place for fair market value

Either way you no longer live there.

#118 J man on 08.21.12 at 2:46 pm

I would love to hear how a housing crash will not lead to a large scale hit to commercial RE. Retailers would get hammered, mortage/finance people, developers, construction offices all closed (plus more affected by the ripples) driving up vacancy rates and driving down lease rates. Or is there some magic I don’t know about?

You say that won’t have an impact on commercial RE income. How so??? I would think this claim certainly warrants a blog post seeing as you are steering so many people towards this investment. I’d say it certainly warrants more than a simple “no” or “won’t happen” answer. There has already been plenty of time devoted to beating up on residential RE so why not take some time to educate the masses on what insulation commercial RE has from all this?

You are making this up. Look at what major REITs contain as assets. — Garth

#119 Just Park It on 08.21.12 at 2:53 pm

#100 DM in C

Sorry friend – I work as an assistant to a Trustee in Bankruptcy – why is it when someone throws a bone to your average Canadian you must be a villain mortgage broker or real estate agent! I work the front lines unlike most who post in here – many would retract their statements if they saw what I see everyday!

Again, some people here have no clue what they are saying and what they wish for scares me!

Leave hate at the front door – then enter!

#120 eaglebay - Parksville on 08.21.12 at 3:12 pm

#96 Graham on 08.21.12 at 12:38
“Oh, seriously. Get a grip. Been in academe for twenty years and never met a single authentic communist yet. Met a few fascists, though. Legit, full-blown, hard-core fascists. Guess which party they vote for?”

Been in academe too long.
A fascist to you is probably someone that isn’t “liberal”.
By the way what do you teach?
Ever tried a real job?

#121 eaglebay - Parksville on 08.21.12 at 3:19 pm

#99 deja view? on 08.21.12 at 12:47 pm
“As it turns out, broom is really a metaphore for the mass migration of Ontarians and Albertans to my fine neck of the woods.
Never having been much of a green thumb in the past, I now agree.. get rid of the broom!”

You’re too late. We’re a majority now.
Somebody has to overtake the tree huggers. That’s the real broom. It’s called Scotch Broom by the way.
Bring on the pipeline.

#122 J man on 08.21.12 at 3:25 pm

REIT are a varied mix of industrial, large residential and commercial properties all subject to ups and downs including but not limited to the impact of a large scale residential RE crash. Many industries revolve around home/condo building and commercial products so they are hardly immune. Throw in something like a drop in the price of oil and we’ll really see the industrial side hurting. I’ve already mentioned why commercial will feel the pressure. Housing is a huge economic driver of the commercial market. Large residential units will be under pressure if flippers are forced to put their currently unlived in units on the rental market thus saturating the market and driving rates down.

#123 Don on 08.21.12 at 3:25 pm

DonDWest on 08.21.12 at 11:52 am

“#76 eaglebay – Parksville”

“If it’s not too late, we could teach our kids to think for themselves, to do research, to learn on their own, read and not assume that the teachers are always right and know it all. . .”

Corporate capitalism doesn’t pay you to think that way. . .

Wait a minute boys, ‘people not thinking for themselves’…my realtor just informed me that is just a myth. He says it’s ok to buy a million dollar home as it will be worth two million next year, confirmed by the mortgage expert at the bank, who is giving me a cash back down payment and a line of credit. The News guy says prices will only continue to increase, even though around the world they have crashed. After all they are the experts. So confused must hire someone to get my thoughts straight.

IN SHORT I Agree fully with you both. Will have to confirm this with a stranger though. It simply amazes me how so many educated people are so simply stupid. I have been taken some master level courses and I shake my head at the profs, all theory, pie in the sky thinking with little implementation experience. Education is only knowledge, how one applies the knowledge is priceless.

Later dudes’

#124 Djb on 08.21.12 at 3:32 pm

Garth do you advocate signing up for DRIP’s or do you take the cash with ETF’s and REIT’s?

#125 eaglebay - Parksville on 08.21.12 at 3:34 pm

#115 Junius on 08.21.12 at 2:18 pm
“#90 DonDWest,

You said, “Corporate capitalism doesn’t pay you to think that way. . .”

Amen. It is so true and so sad. People are not taught to think but to become functionaries and conformists.”

You’re confusing corporate capitalism with liberal socialism. The education system is loaded with functionaries, union suckers and entitled people.
Most teachers should not be teaching. Fortunately there are exceptions.
Technology may help us in the future.
Problem solving anyone?

#126 Brad in Calgary on 08.21.12 at 3:40 pm

For those frustrated by Garth’s inability to see the significant differences in Alberta – Note that he will probably ignore this post, block it, or refuse to deal with all the facts contained in it. It only hurts his credibility to overlook this information and laugh at Albertans who consistently explain to him why a crash won’t happen here.

#127 Jon B on 08.21.12 at 3:40 pm

Enjoyed your talk last night. I like your fast moving presentation style. Charts and numbers can get boring but you did a wonderful job in conveying the key bits of information that needed highlighting for the delusional audience. I think you need a better opening band than your bond-guy partner. Thanks again GT.

#128 Smoking Man on 08.21.12 at 3:42 pm

#125 Junius

Amen to your post. The globe and mail is running a story about a high mark valadictorian who used hell in her speach has been denied a deploma that she erned.

She can get it if she writes a letter of appology.

In other words. Obey Dog. Sit Dog,

The eduction industrial complex.


#129 John S on 08.21.12 at 3:42 pm

#109Bob on 08.21.12 at 1:38 pm

Home prices Plunge-0-meter:

#130 Blobby on 08.21.12 at 3:52 pm

I arrived a little late thanks to some problems.. i was turned away as the room was already full to capacity.

Any chance you could come back and do a private 1-on-1 show for me?

I dont want to buy a house, quite happy renting, but i find you hilarious.

#131 DM in C on 08.21.12 at 3:53 pm

Just park it.

“I work as an assistant to a Trustee in Bankruptcy ‘

“I work directly in this industry”

Interesting correlation you have going there. So bankruptcies only occur in the mortgage and housing industries? Or is that your specialty? Perhaps we should have the Trustee give opinions rather than the assistant.

And for the record, most people here aren’t pathetic — many were smart enough to recognize a bubble in the making. In my experience they simply want those who were smug and derisive by having the luck of right timing on the way up to feel humbled when it does eventually correct. Schadenfreude.

#132 DonDWest on 08.21.12 at 3:56 pm

#96 Graham

Two faces of the same coin. . .

#133 The American on 08.21.12 at 4:26 pm

Great talk last night, Garth.

And for something fun… Americans embracing an import from Canada. Seriously, we do love her! (a lot of guys will like this one)

Sure the economy went to hell, but we still know how to have fun. Please keep Beiber there, though. Thanks :-)

#134 Danforth on 08.21.12 at 4:33 pm

Who’s the cutie, front row – third from the left ? :)

#135 TRT on 08.21.12 at 4:41 pm

Smoking Man:

Why do you never miss hitting the space bar in your posts. Words spelled incorrectly many times but that space bar is always right. Hmmm… Try to skip hitting it every sentence or so..

#136 bigrider on 08.21.12 at 4:48 pm

Ron Jeremy was in the audience last night.

#137 eagle eyes on 08.21.12 at 5:06 pm

#119 Just Park It

It’s just that CRA has more power than any mortgage company, so as much as Canadians would like to meet their obligations, the tax man comes first. First tax man, then food, then shelter. If it means defaulting on the mortgage to feed the kids and finding a cheaper rental, then jingle mail it is. It wasn’t a hateful comment. People just have an innate sense to survive.

#138 nufio on 08.21.12 at 5:07 pm

Do you have any recommendations for good canadian REITs or ETFs that track the good ones?

#139 Investx on 08.21.12 at 5:10 pm

#124 Djb:
Garth do you advocate signing up for DRIP’s or do you take the cash with ETF’s and REIT’s?

I don’t so, as I think you can only DRIP individual equities, and Garth does not recommend investing in individual equities.

#140 bigrider on 08.21.12 at 5:17 pm

Real Estate-The riskiest of all investment classes.


1) Has the greatest amount of emotional appeal thereby clouding judgement

2) Has greatest amount of leverage thereby magnifying losses

3) Has greatest illiquidity thereby entrapping investors.

4) Has least amount of healthy skeptism among its proponents

#141 An Cat Dubh on 08.21.12 at 5:20 pm

Why aren’t you Prime Minister yet? America’s ditched Cheney and the conservative nutcases long ago, and that party is almost extinct in America. November is a done deal, and after that, 2014, 2016, et al. The 1% have thrown away billions for nothing. Canada needs to catch up.
George Bush and co. were not conservative. He tripled the size of govt and increased the debt. He was a fiscal socialist. Obama is a naked communist.

#142 Vancouver Thunder on 08.21.12 at 5:21 pm

My wife likes you Garth and enjoyed your talk. I am glad you came and enjoy your blog.
You mentioned that interest rates are going up….thats a given. You stated why would anyone invest in a house when you know the prices are going down.
At the end someone asked if interest rates are going up why invest in bonds?…..everyone knows that there is an inverse relationship and bond values will down with few exceptions. You instead put the question over to your colleague with 20 years experience in the bond market. He couldn’t answer the question and instead mumbled about diversification. I found that to be a bit lame.
None the less I believe you genuinely want to help the little guy and respect you for that.

#143 Superman on 08.21.12 at 5:23 pm

Garth, you are being far too conservative with your estimate of a 40% drop in prices. Why not be a little more liberal with your estimates? I know you have it in you… OHHHH, BURN!!!!!

Seriously though, Vancouver is going to drop far more than 40%, especially when inflation is factored in.

#144 Smoking Man on 08.21.12 at 5:28 pm


Spelling correctly would mean I endorece the obidiance making educational complex.

Its a rebelious act. I guess

#145 TRT on 08.21.12 at 5:34 pm

Canada’s Major Newspapers are banding together to charge for content. May backfire as the sheep they keep trying to brainwash will not pay for content. The only ones paying will be the ones that can see thru the bs.

Good move..

#146 jess on 08.21.12 at 5:40 pm

john and junius
see previous post re:commodity derivatives
II. Today’s Markets and the Impact of MiFID 1
20 of 67

#147 luke8929 on 08.21.12 at 5:57 pm

Still the occasional place selling in Vancouver, usually demolished shortly afterwards. Builders have no choice but to build, flippers still flipping, hey when your in debt that far whats another $500K or more its not like even in bankruptcy they are going to see much of it payed back, just some speed bumps on the way down.

Lots of commercial property for lease down on Kent Ave. in Vancouver and other commercial areas, not sure how that affects REIT’s but it wouldn’t seem to be a positive sign for cash flow.

Its not just houses that are in the stratosphere, a single taxi cab in Vancouver sells for around $600K for a full share (day and night voting share) cab driver tells me the last yellow cab sold for over $800K. Hows that easy credit working out for you?

No worries though central bankers going to keep making more easy money available because its worked out so well this far, how can you lose with quality assets like condos and taxis on the balance sheet.

#148 DonDWest on 08.21.12 at 6:01 pm

“You’re confusing corporate capitalism with liberal socialism.”

Have you ever delt with/seen HR departments in giant corporations? They’re conformity checklists. Corporations want to make us nothing but robots, and make no mistake, there’s a reason why they value that “socialist education.” It’s a method of screening out non-conformists from the hiring process.

#149 cynically on 08.21.12 at 6:13 pm

#89 Just Park It —- I’m sure you did the right things to own your home but many, many people haven’t and therefore don’t own the home yet and it isn’t just “a percentage” but a very high percentage. You sound like there is a little guilt-trip going on in your head as you seem to downplay the hard and fast selling that at least has taken place in Vancouver. That is where the guilt lies as many of these people hadn’t the financials to carry a large, expensive purchase such as a home and those in the RE business would or should have known this, after all they are supposed to be the professionals, so maybe a little greed took over their thinking. As for your clients, they will do what they have to do and it may not be what you seem sure they will do but you must give them the best advice you can. I feel sorry for them because somewhere along the line they were sold the proverbial “bill of goods” that they were not properly prepared to buy. Good luck!

#150 jess on 08.21.12 at 6:18 pm

anonymity vs anonymous

Secret Libor Committee Clings to Anonymity Following Scandal
By Liam Vaughan – Aug 21, 2012 8:53 AM ET
…” the body that governs the benchmark for more than $300 trillion of securities worldwide, is a secret. No minutes are published. The BBA won’t identify any members, saying it wants to protect them from being lobbied, and declined to make the chairman available for interview.

#151 Uh Oh Canada on 08.21.12 at 6:24 pm


How do we get you to come to Montreal? What’s the best bribe?

#152 Mithan on 08.21.12 at 6:32 pm

#89 Just Park It:
I am not “hoping” for a crash. However, I think the facts are there that there will be a crash at some point (Now).

Prices can’t go up forever, especially when it is induced by euphoria or fear.

What I find comical is that we are WAY past US levels in terms of build up here.

We’ve been told for 4 years that a crash was coming by the egg heads that lived in theory land and they based these calls on data and information. I don’t know what Garth was predicting because I have come here recently, but I remember the Merrill Lynch report in 2008 calling home prices to be over valued by as much as 40% based on historical norms in many places in Canada. That was in 2008 and since then, we have seen dozens of analysts repeat the same thing. I think homes have increased 30-50% since then. Incomes have not.

They were wrong obviously as prices only increased, which means when they are finally “right”, it will be devastating.

Hell, in Regina here, if prices were to mean revert and then just add inflation, it would be a 50-60% crash. Markets are local though as seen in the US when some areas crashed 60% and other areas only crashed a few % points.

Either way, reality will come back and it will be harsh. The future is going to be filled with increased cost and something has to give and that which will most likely give is home prices.

#153 Ronaldo on 08.21.12 at 7:08 pm

Garth, re: #106 truth hammer. I’m surprised that you put up with the verbal diarrhea from this poster. How can someone make comments about people in your audience that he knows sweet bugger all about. Disgusting to say the least. Think its about time you switched him/her off.

#154 cynically on 08.21.12 at 7:09 pm

#103 futureexpatriate ——– I don’t know your political stripe in Canada or the US but you are wrong about the Republican Party. Sure Cheney is gone (thank God) but the real nutcases have taken over and they are even more dangerous for US democracy than the Cheney neocons. I’m talking TEAPARTIERS, Sarah Palin, the lunatic fringe which took over the House in 2010 and now are after the Senate and the Presidency, although I don’t believe Romney is one of them. However they can handle him as has been shown by his ever-changing positions during the primaries and the runup to the Presidency. He’ll say anything to get elected. He’s their puppet as he knows he needs their vote.

#155 Devore on 08.21.12 at 7:21 pm

#88 OlderbutWiser

It’s diversification, and risk management, as Garth says.

Think of it this way. When someone shorts a stock, they will often buy options on the other side of the deal. You might say, why would someone do that, they’re GUARANTEED to lose money. Yes they are. That’s the point. They are limiting their risk. If they’re right, their hedge will take a small bite out of the profits. If they’re wrong, the hedge will limit the extent of the losses, especially if they are catastrophically wrong.

Everything has risk. You hold anything, it has risk. But there is risk, and then there is risk. It’s not a binary proposition, risk, or no risk. It’s a spectrum.

The basic goal of investing is having more winners than losers. You WILL lose money. That’s a guarantee. Every investor loses money. The good ones know how to cut their losses, limit risk, and analyze opportunities to increase chances of having a winner. Whether you’re buying individual stocks or indexes, the same concept applies. And holding uncorrelated assets (ie, things that don’t all move in the same direction together) is the easiest way to limit risk, while increasing diversification.

(When I say winning and losing I won’t mean to make this sound like a sport or a game, it’s just an analogy. Investing is serious business, and if you don’t know what you’re doing, don’t do it. Pay some money for someone else to do it. Think of it as a premium you pay to limit your risk.)

#156 Daisy Mae on 08.21.12 at 7:43 pm

#127 JonB: “I think you need a better opening band than your bond-guy partner…”


Hmmm…this has been mentioned a couple of times. WAS Scott there with you, Garth?

#157 yeg_guy on 08.21.12 at 7:43 pm

#126 Brad in Calgary

I can’t agree with you more. Alberta is different. With it’s economic engine driving Canada and the influx of new residents moving for opportunity, it won’t crash and burn. Unless another version of the NEP enters the equation.

Nobody said ‘crash and burn.’ But a correction of just 15% would wipe out the equity of most new buyers in the last three years. Life is not lived in extremes. Even in Calgary. — Garth

#158 Private vs. Public on 08.21.12 at 7:47 pm

#152 Mithan


I happen to think that Garth downplays the eventual percentage drop, so as not appear too alarmist.

However, privately, he must know that the numbers will be much, much bigger, and that the coming real estate crash will be even more catastrophic than he publicly admits.

This is why he toils away, writing on this pathetic blog–trying to save the willing.

#159 Steven Rowlandson on 08.21.12 at 7:56 pm

Even if the down payment was waived and the interest rate equal to or less than zero canadian real estate is unaffordable and costs too damned much relative to a working mans annual pay. And don’t give me any communist crap about the virtues of putting the wife out to work so that you can offer and pay more for a house. Women are women and not men. Keep them at home and quit trying to make the realtors and banksters rich. For the good of the species real estate prices and social progress must crash and burn. If you want profits run a productive business and quit trying to financially bugger the working man or any one else for that matter.

#160 Mat on 08.21.12 at 8:13 pm

Any thoughts on that?

#161 Another Albertan on 08.21.12 at 8:14 pm

Keith – forget the Fatburger clientele…

I was blown away by the absence of white-collar professionals in downtown Vancouver. Tourists on every street, but few obvious office workers, and even fewer in anything even resembling business attire! (I’m not even looking for a suit… even a shirt with a collar will do…)

My decade-old autobahn car looked totally pedestrian in the underground lot… it was surrounded by new, high-end vehicles. Jag. M5. S5. 911. 911. 911. Most appeared to be driven by males in their 50s and 60s.

The stylish restaurants on Alberni and its ilk were packed with all age groups from 5pm onward. It’s nothing to drop $150 on a good (but far from outstanding) meal for two.

And most of the time when I talked with people, I couldn’t get a straight answer about what they did for a living. They clearly have jobs, but few were really open about admitting anything. What I do know is that most people don’t work for a major national law firm or a bank or a mining company. It’s like it’s a big secret and you’re only allowed to say that you do “stuff”.

I don’t get it.

Everyone else’s mileage may vary.

#162 Smoking Man on 08.21.12 at 8:15 pm

#108 vic_guy on 08.21.12 at 1:28 pm#108 vic_guy on 08.21.12 at 1:28 pm


I like your drive, and you probably have a good product.

But there is going to be a 150 to 350% worth of loot to be made when Europe tanks, then 200% on the way back up.All in the next 18 months.

Good chunk of my loot is sitting idle in 7 trading accounts waiting for Batman. Govt/bank only guaranties 100k. Loot in Trading accounts is covered up to a Million in each.

So although your pitch may be a good one, not enough of a return for a spoiled, entitled, genus, greedy gambler.

Investor I am not

#163 Nostradamus Le Mad Vlad on 08.21.12 at 8:16 pm

Garth, owzaboud Smoking Man opening up a gig for you here in the ChokedUpangan? SM can entertain the hordes of fans with a mixture of Floyd, Hendrix, Doors, BTO, Zep and others while the Amazons can take care of all the small stuff!
#158 Private vs. Public — “I happen to think that Garth downplays the eventual percentage drop, so as not appear too alarmist.” — Interesting perspective. see first link — Three of the elite are betting on fiscal catastrophe and TPTB’s Hidden Agenda Carbon Tax is ruining Oz’s economy; Debt Jubilee What if some are debt free? Debt is Contagious like chicken pox; Equity Markets and Bernanke; 3:26 clip New greenback? On-line Price Fixing Whoda thunkd it? Economic Collapse Govts. removing civilian militias; ECB takiing control of smaller banks; Buffett makes cuts; Casino sues winners for winning; Wall St. bailout Champagne corks were popping everywhere; Volcker on Build Yer Burgers A strange religious cult; Groupon, FB and Twitter Chopped liver; US economics Mitt Romney’s running mate, Paul Ryan, ‘is no less than the reincarnation of a free marketeer who wants to recreate the circumstances that brought us all 33 major economic downturns crowned by the Great Depression. How quickly people forget’.”
Warmongers of the 1930s and today. Different people, same goals; Small Farmers Monsanto up to its dirty tricks again, and Walmart selling Monsanto; Republicans imploding “Obama just won his second term.” and 0:40 clip Romney hiring neanderthals as politicos; Silencing Dissent Obey, sheeple; Interrogation Tactics for letting kids play outside; End Times Yes, the end of the west’s cycle is drawing ever closer, but the west doesn’t want to hand over power yet, and US govt. developing new cyber weapon; Good QuestionMaybe it’s because the ‘authorities’ knew all along that 9-11 was an inside job.

#164 Smoking Man on 08.21.12 at 8:19 pm

#145 TRT on 08.21.12 at 5:34 pm

Not going to fly with the CDN herd

I give it 3 months before one of them breaks rank and offer it up free again.

Nothing like a competition bureau to look after us.

#165 The American on 08.21.12 at 8:19 pm

At #152: Mithan, BINGO! You win the prize. Figures for the price fall in Canada are ridiculously conservative right now. Canada hans’t seen anything yet. ALL THINGS RETURN TO THE MEAN. That means there is going to be a nationwide correction of, eh hem, I dare not even say then percentage number.

#166 The American on 08.21.12 at 8:23 pm

At #154: Clynically, have you picked up a newspaper lately? Teabaggers were nothing but a passing fad in the U.S. Palin is caput. She’s not even invited to the Republican national convention.

You are correct, though, about Romney. He’ll say anything. And I mean ANYTHING to get elected. He’s a douche bag that doesn’t stand a chance in the upcoming election. Even conservatives believe this. Polls lie today to show the election neck and neck. A heated election campaign results in sales of papers :-) So, the papers create fake polls to establish “data” that shows them in a near dead heat. In reality, talk to any American, and he/she will tell you its all but over for the Republicans (who ruined this country) for the most part.

#167 Barry in Pickering on 08.21.12 at 8:49 pm

))) Any balanced portfolio should have corporate bonds, government bonds, real return bonds, high-yield bonds, REITs, preferreds, trusts and a diversification of ETFs.

Unfortunately that list is highly correlated (not “balanced”) and so they all move together. You will likely learn that the hard way.

#168 salonist on 08.21.12 at 9:14 pm

mr trt
you dogging god.
you wouldn’t sit back and watch the show.
you’re like the fencepost, one space bar short of an iq.

#169 truth hammer on 08.21.12 at 9:28 pm

In an investment arena as small as Canada I can say that I welcome even the anticipation of a 40% drop in RE prices……not just because such an event will skewer millions of greedy pigs and leave the streets flowing with blood and tears….but that such an event will let fly the pendulum back towards the financial markets when fear of real estate grows a crown and horns because then golden greed will again be represented in the the prospect of massive profits to be had the equity markets.

The demise of real estate is the moment equity investors have been waiting for…….the recycling of greed from asset to equity. There are only two aspects to human nature when it comes to investing…fear and greed……when fear becomes ubiquitous in the property markets…then the greed that held court there will shift to the worship of a new infatuation…the stock market.

There is more money sitting in cash on the sidelines both by commercials and private interest than ever before in history…….it has been five years of anxiety and pain for equity markets as we have seen the focus go to the less fungible property market.

My guess is that when the dam bursts….and the bulls break past the wall because there is nowhere else to go except to run past the bloated corpse of the real estate balloon…..then we will see a flood of capital and a stock market boom the likes of which has never happened before…..conditions for a boom are unique historically…..and would serve to rebalance the natural markets after the government(s) have misinterpreted the essentail message of 300 years of capitalism….that human nature is unstoppable……ask the Chinese and Russians that question…..that fear and greed are a cosmic force that will never be undone by morons like Trudeau and Keynes.

Real estate is dead….long live the specualative markets. Governments have a good deal less influence in equity markets…….let them try to ‘fix’ their mistakes while the adults come back out to play.

I am well positioned….having caught the first 10% I feel good……and yes… sucks to be me. Bwahahahahahahahahahahahahaaaa !!!!! There’ll be no snow tires for me.

#170 disciple on 08.21.12 at 9:34 pm

#139 Investx… You can DRIP most ETF’s if the option is available, the only difference being that you can only do so by accumulating whole shares rather than fractional as with individual equities…

Jack Ruby was played by Rockefeller Sr., and Oswald was the same actor that played Jim Reeves who had two Top Ten posthumous duet hits with with Patsy Cline… Get it? Patsy? The joke has always been on us…

#171 GeoKall on 08.21.12 at 9:46 pm

Garth I am looking for 10 % cap rate on income properties is that reasonable in todays market? If not what is?

#172 aggie on 08.21.12 at 10:02 pm

Well, we drove in from Maple Ridge/Pitt Meadows… my friend was convinced that it’s different out here, and I think you managed to somewhat adjust his perspective.

He was never quite convinced that I should sell at what is turning out to be about an 8% ‘correction’ price and be willing to shoulder some closing-costs debt. He’s starting to see the point, especially as I need to be more flexible in both my living and financial situations. I am starting to peddle hard down the yellow line — and no, it’s not made of gold bricks!

We had a good brainstorm afterwards, with a fellow who suggested another type of visual, one that shows the correction’s epicentre(s) and the reach and intensity of the waves as they spread across the burbs, meadows, and mountains.

It was a very interesting crowd. We were curious about what sort of demographics would be represented, and it was surely right across the board, a complete cross-section, almost, of west coasters. I even recognized a few blog dogs, was bang on on one, I know because I asked ;-)) And I think Bigrider was one of the early birds…?

Ach, but that would be saying I was too. Which I was. Till I went for a coffee.

Saying Ach reminds me that I had to look something up, after nodding my head in agreement to what #112 Sollbruchstelle had to say…

Sollbruchstelle: this German engineering term translates as “part that is supposed to break down”. It stands for that part of a machine that is deliberately designed to be weaker, and less costly, than other parts of the machine so that it, rather than the more expensive parts, takes the hit when the machine comes under stress. A breakdown thus comes with little collateral damage and is fixed quickly and at low cost.

#173 GT Fan on 08.21.12 at 10:04 pm

Hi Garth, would you please consider coming to Ottawa? You have LOTS of fans here!! :)

#174 aggie on 08.21.12 at 10:05 pm

Wow, that was a long comment I just wrote. Here’s the part I deleted off the end… but what the hey, I’ll paste it back in. It may seem like fluff, just saying. But sincere… just share it with your team if you like, and don’t bother putting it on the wall. Up to you.

Garth. Are you quite aware of how very special you are? Please, I don’t mean to flatter, just acknowledge and thank you for sharing your intelligence, common sense, ability to absorb and share boundless information in not just the incredibly well-written word, with wit, but also the spoken, with wit.

Last night, I realized that you are also an amazing teacher. It was the very first time I could actually focus on and quickly grasp graphs and charts about money and markets. The pace was perfect!

Your support team must be very much in sync with you, because I’m sure that more than a few hands and heads had to help pull it all together… especially all those great visuals! I still shake my head, because you didn’t charge a penny nor even extract a promise from your pathetic (not really) attendees. A big thank you to you and your gang.

Oh my, but that black suit bothered me at first, wanted to quietly sidle up and help you out of the jacket. That’s the Ontario way, right, to wear the mandatory suit when discussing monetary matters? I grew up there… must say I prefer the west coast way.

Well, must sign off now. Home inspection tomorrow, subjects hopefully come off on Friday… and then I will be researching rentals and… RVs! Why the heck not live like a turtle? Or is that a bad investment idea too…

Oh, and I also appreciated your answer to #88.

And Derek R’s ongoing kind words of support :))

#175 Djb on 08.21.12 at 10:23 pm

#139 Investx

I own which is the iShares monthly income fund, which is the BMO covered call utilities ETF and
Which is True North Apartment REIT all of which offer DRIP’s

True north offers a 3% discount to the average 5days trading price before going ex dividend.

#176 Junius on 08.21.12 at 10:39 pm

#125 eagle-parksville,

Technology may help us? To do what – stop having to think all together? Yeah, right. And who teaches the technology? Who programs it? Try again.

Your comment about Liberal Socialism is typical. When I went to school we read Ayn Rand and Karl Marx, Adam Smith and Hayek, Plato and Hobbes. It wasnt about ehat we read but how we learned to think critically about what we read.

The problem with you Neocons is that you are so sure that you have all the answers you stopped thinking long ago and just started shouting. A claasical liberal education teaches humility and the limitations on each individuals hold on the truth. You should get one. Take Hammerhead with you.

#177 45north on 08.21.12 at 10:45 pm

Mithan: Markets are local though as seen in the US when some areas crashed 60% and other areas only crashed a few % points.

they aren’t all that local, here the charts on 20 US cities

San Francisco dropped 42% from market peak, smallest drop was Dallas 10%

if the GTA (Greater Toronto Area) were to drop 30% Dalton McGuinty would have to run. I see a convoy of stretch limos and trucks moving Dalton to a secret hideout in Algonquin Park. Somewhere between PeeWee and Provoking Lake.

#178 Linda on 08.21.12 at 10:46 pm

Hi Garth,

Interesting presentation yesterday!

Couple of weeks ago, you wrote about a good investment (better then condo) like multi family in Windsor, Medecine Hat, Moncton, etc… and as for example, you put a link showing a multi family (300K down payment, revenue $74K).
I though it was a good idea to invest in something like that. I am planning to buy a multi family in couple of years.
But, you say it is not good to have renting income for taxes purpose if someone works.

But if the “someone” doesn’t work and it is her revenue (I am not trusting Canada Pension Plan when it will be my turn!) is it a good thing to do, buying multi family? If taxes are going up is it a good move? That was my question…

Tk’s and keep on your interesting work!

#179 six-figure-renter on 08.21.12 at 10:47 pm

Garth Turner ended my relationship….THANK YOU :)

#180 Elmer on 08.21.12 at 10:58 pm


Mullets are cool!

#181 Skip Breakfast on 08.21.12 at 11:13 pm


No, houses are not money. An asset like a house CAN be a store of wealth, but that is not the same thing as “money”. While there is some grey area in the definitions for both “wealth” and “money”, they are not the same thing. For example, “wealth” can include a rock-solid marriage to your very passable transsexual wife, or a really strong, healthy heart that will see you through to the age of 100. You cannot trade either of those wealth-contributors for food at the grocery store, though they make you infinitely more “wealthy” in terms of happiness in life. To cut through through the confusion about such definitions, I prefer the Tesco Test (or in North America I guess it would be the Wal-Mart test, since I don’t think there are any Tesco’s in Canada). That is, if you can trade it for goods at Tesco, it’s money. That leaves us with currency and credit. That is money, and that’s about all that is money. Wealth can often be CONVERTED to money, which makes it a good way to preserve your money, but that does not make them the same thing. And the definition is also helpful to me in thinking about gold too. Because I’ve read in many-a-blog comment the sad lament of the gold bug who would love to buy more gold…if only he had more MONEY. So you need money to buy gold–yet the gold-bug insists fiat is worthless and gold is the only real money. Try spending your gold at Tesco/Wal-Mart. Try spending it ANYWHERE. You need money to buy gold, and you need money after you sell your gold. One day that may change, but it’s a long while away yet. Until you can spend your house and your gold at Tesco, neither are money.

#182 Astute Poverty on 08.21.12 at 11:22 pm

#82 wrong on 08.21.12 at 10:54 am

I totally agree, my nick doesn’t refer to them, I’m guessing you don’t know what it means either

#183 Astute Poverty on 08.21.12 at 11:24 pm

People always question Garth’s case studies so he’s a good one to make you scratch your head.

#184 Astute Poverty on 08.21.12 at 11:28 pm

these people feel entitled to a house but yet they can’t save up enough for a damage deposit.

#185 Oceanside on 08.22.12 at 12:05 am

Rosebery….Have you or do you live in Rosebery?

#186 Observer on 08.22.12 at 12:37 am

Garth if you can draw like that on the coast, you’re officially a one man cult. I was happy though, to see only a laptop in lieu of burning coals. :-)

#187 renters rule on 08.22.12 at 12:38 am


Alberta is different. With it’s economic engine driving Canada

You are an idiot.

Enjoy taking it up the *ss, as I have no doubt you are overleveraged and over-exposed in an asset class that need not be named.

Why are Albertans so r*tarded?

#188 Gunboat Denier on 08.22.12 at 12:43 am

181 Skip:

“That leaves us with currency and credit. That is money,
and that’s about all that is money.”

Say I have a $100K LOC. Or maybe $100K in a bank
account. I can write a cheque on either and it will
gladly be accepted by numerous legal entities as
payment. Are they both money?

#189 Derek R on 08.22.12 at 12:44 am

#181 Skip Breakfast on 08.21.12 at 11:13 pm wrote a lot of sensible stuff about money.

SB, I liked what you said on the topic of money but for future reference Tesco in the UK is more like LobLaws/Superstore in Canada. Asda in the UK is (unsurprisingly) more like Walmart in Canada.


#190 Nostradamus Le Mad Vlad on 08.22.12 at 12:58 am

It’s 10 PST and no new post, so I’ll tack it on to the present one.
#169 truth hammer on 08.21.12 at 9:28 pm — “There is more money sitting in cash on the sidelines both by commercials and private interest than ever before in history . . .” — Correct. There are trillions just waiting to be invested, but why wait? Sure there is money movement going on from west – east – west again, but what are the big investors waiting for? There has to be something happening behind the scenes.
China bubble in danger zone; Borrowing soars Right after the Olympics, but no matter — Super fast mobile ‘net service almost here; San Onofre nuke plant 1/3 of workers laid off; Hello Sailor! and UK airlines cutting costs by cutting safety. Subs can pick up survivors in the sea; Barclays in Africa; Lindt Chocolate Bunnies have fallen to The Evil Dark Side; Best Buy 91% drop in profits, but Afren (UK energy) enjoys surge in profits; Nightmare on Suburbia Street; Pre-war Germany has a solution to EZone fuddle-duddle; UK pension system, like the US tax system is incomprehensible; Global business leaders are paid too much (they say it); Venezuela #! for cheap gas )Top Ten list); What does the fear index say? Youth unemployment soars in northern England.

More than 50% of Americans are dependent on their fed. govt.; John Mauldin Germany headed into stormy waters? Psychology and stuff; The Golden Years can kiss my ass; ?$1 million A slightly easier path (no lottery tickets); GD1 Worst still; US Pensions Sinking like a sunseet; 8:07 clip The future isn’t fair; 12:39 clip You can’t give it away; Spain Tax more, get less so the ECB prints until the end of time; Buy Coal! Better than land; USS auto job losses coming, says Ford; Bull Market for Commodities? Bubble Guts Market; Oz Mining Companies need workers ASAP; Zombie Companies from China, and Africa is one of China’s new oil sources; Triple Top Strike three, yer out; Polar shift in markets?
Neon Sea Either that or I’ve gove nuts; 800 pounds for fish ‘n’ chips (chips are free); Sweet (new) Broccoli From the country that invented mushy peas; Ron and Rand Paul There wasn’t much they could have done had they been elected; Anonymous How to fool facial recognition; US Teen invents new test for cancer. He will go far (probably east); Unaligned states meeting in Tehran; Russian and American militaries busy building; 1973 Philadelphia pix.
disciple — Remember, the mind is nothing more than an adequate to good servant, no more than that. Each has their own box of toys, each is guaranteed the freedom of choice to rearrange their toys any which way they want. The mind is only for the lower psychic regions, not the higher spiritual ones.

#191 TRT on 08.22.12 at 1:27 am

#168 Salonist

Shaddup! Shouldn’t u be cutting hair??

#192 new canadian on 08.22.12 at 1:30 am

#89 Just Park It
It will crash, because it should. There is no way avg home is around 350K. Canada is the 2nd largest country with tiny 33M people, a number doesn’t increase btw over decades.

As a European immigrant, I hate these houses. Wood, decorative bricks and glue. Heating is by blowing hot air from floor upwards with all dust and dirt. I live in a brand new condo and really enjoy whole thing shaking when washing machine is on.

I am not planning to buy so I didn’t miss anything, just it hurts I pay 1500/month for this poor quality of life. So let’s say 60% downturn in prices, it will push rents down in long run. I am willing to pay up to 300/month for shelter at this quality.

#193 Fist Full of Dollar$ on 08.22.12 at 2:14 am

Looks like you had a good event in Van City, Mr. Turner. Any plans on coming to Kelowna and breaking the bad news there??

#194 cynically on 08.22.12 at 2:43 am

#166 The American — I think you’re wrong about Palin. To her great disappointment she hasn’t been asked to speak at the convention but she will be there unless you’ve heard something in the last two days or she’s off in a huff with a hurt ego (I hope). You definitely underestimate the power of the moron teabaggers because they are a large, closed group backing Romney along with the evangelicals and remember what they were able to do in the House in 2010. They are being criticised by some of the old intellectual conservatives for their religious and material inanities which shouldn’t hurt Obama. Any Republican discord helps him. We’ll get a better read after the conventions when the two go head to head on tv and my money is on the President.

#195 Tony on 08.22.12 at 3:27 am

Re: #169 truth hammer on 08.21.12 at 9:28 pm

The opposite will happen to stocks. The U.S. market should drop around 80 percent while the German market should fall about 90 percent.

#196 Harlee on 08.22.12 at 4:48 am

All this talk about (and it’s going to be more than talk soon) about 40% drops in this ..or that…Panic ? I think it will be a good thing. Get people back to basics rather than BS about crap. Thinking died out sometime in the ’80s but maybe (dare I hope?) that it will make a come back. When I was grade school ,all those moons ago, we took “economics” and it was based on real things – “buy” a box of corn flakes, then caculate how much value we’d get from that box. If today the kids get the same lessons it would be : “How do you FEEL about the corn flakes ?” There’s been a dumbing down all over but maybe (hopefully) it will turn around ? Don’t mock me for being an optimist.I’m getting older and I need to believe in something.

#197 Skip Breakfast on 08.22.12 at 4:52 am

@Gunboat Denier

Uh, yes? They’re credit and cash, aren’t they?

#198 Skip Breakfast on 08.22.12 at 4:58 am

@Derek R.

Thank you. The only Tesco I’ve been in has been in Thailand. I think the Tesco Test originated in the UK though (I didn’t invent it! I just think it’s very helpful.)

#199 futureexpatriate on 08.22.12 at 7:11 am


ROFLMFAO. Thanks, Harper, for weighing in.

Mene, mene, tekel, upharsin.

#200 ralph tieleman on 08.22.12 at 10:16 am

Prices in Tofino have dropped by 20% or more.My assessment was down by 100k on a 5-600k property.Sales here are very slow.Some foreclosures aren’t finding buyers.

#201 Gunboat Denier on 08.22.12 at 10:26 am

197 Skip – so from Garth’s post referenced by Taxhaven:

“What we all require isn’t a house, but money”

is the equivalent of

“What we all require isn’t a house, but ….’currency and credit’…”.

Seems like a bit of a disconnect. Is there something else that could be money?

#202 Derek R on 08.22.12 at 11:01 am

#201 Gunboat Denier on 08.22.12 at 10:26 am wrote
“What we all require isn’t a house, but ….’currency and credit’…”.

Seems like a bit of a disconnect. Is there something else that could be money?

There’s no disconnect. Currency is what goes in my wallet and credit is where other people owe me (as opposed to debt where I owe other people).

Sounds like money to me!

#203 Rosebery on 08.22.12 at 6:05 pm

#185 Oceanside.

Never lived in Rosebery but its a very beautiful place to
visit in the Slocan. Probably friendly and affordable too!

I’ve lived on Rosebery which is a lovely street in West Vancouver, named after a famous British lord.

I visit Oceanside frequently and would like to live there
or San Pareil.

#204 Vangirl on 08.22.12 at 6:51 pm

Ingenious marketing. A book tour that was not a book tour. Put on a talk for FREE, pack 1200 people in the room of a xi xi frou frou hotel ballroom, scare the bejeebus out of them with the impending financial doom with slides, charts and amazons (for comic relief) then casually mention that the book offers insight and solutions. Giving out 15 books to the lucky few just stokes the unlucky one’s fire to want it all the more. Sneaky, but ingenious.
“But we don’t sell anything” the card reads, but they offer advice , for a fee. Sounds like selling of a service.

Actually there were no books for sale. But nice try. Are you always this ungracious when you’re given something? — Garth