Eat the rich

tacos

I am 29 years old, and my brother is 33. I was complaining to him that even after a decade of post-secondary certificates, I am not middle-class because I cannot afford a house. The fact that I landed a decent job right out of school shows that I’m lucky as well as good at what I do.  My brother made a great point, saying I am middle-class, but middle-class for my particular generation. The point us pathetic, whining Gen Y are trying to make is that for a relative level of success within one’s cohort, there was a lot more material wealth for the baby boomer generation than there is for Gen Y.

Where would this blog be without whining and moaning? The landlords dis the renters. The doomers lament the bankers. The natives flame the HAM. Everybody slams realtors. And Boomers are dead meat.

Some weeks ago, we just learned, Finance officials prepared a study for their craven deity, F, called “The Economic and Financial Situation of the Canadian Middle Class.” In summary, it sucks. Turns out the Occupy kids were right. Wealth is flowing up at a helluva clip.

The top 1% of Canadians have 26% of the money and pay a third of the taxes. There are about 422,000 people with more than $1 million to invest (not counting real estate) which is 1.2% of the population. Of this group, 28% live in Toronto, 12% in Montreal, 7% in Calgary and just 5.9% in Vancouver – where houses cost the most.

Meanwhile the middle is shrinking, at least in income and net worth. In the last three decades salaries and wages have grown by 0.2% a year, after inflation, or five times less than for the guys at the top. At the same time, median wages have actually declined, meaning more people work for less. Of course, these are better-educated workers, since today only crossing guards and strippers (at least the bad ones) don’t have arts degrees.

Since 2007, median family income in Canada has crawled ahead, from $66,700 to $68,000. At the same time, household debt has grown from just over 100% of income to more than 160%, even as interest rates crashed. The average Toronto house costs 41% more. The average Vancouver house grew 90% more expensive between 2002 and 2007, and has added 60% since.

Today wages and salaries are rising at 1% less than inflation, and credit growth continues to expand – but at the slowest rate since 2009 as families tap out. If interest rates were to normalize – which would double current levels – just imagine the result. This is the nightmare scenario that the Bank of Canada and the elfin deity worry about. It’s exactly why they trashed 30-year mortgages, slapped CMHC around and told banks to stop lending to anyone with a pulse.

So, in summary, the Canadian middle class is in desperate shape. The savings rate has fallen to 3.8% (twas 19% two decades ago). Over 80% of people no longer put money into their RRSPs. Seven in ten don’t have pensions, and a recent survey found a third of us have ‘no wealth’, while a quarter have never saved money. Any. Ever.

And yet 70% have houses. See the problem?

The haters don’t. Being ‘middle class’ is overwhelmingly equated with owning real estate. But if that were the sole measure, we’d have one of the most impressive middle classes in the world. Ironically, it’s this very myopic and destructive house horniness which has helped lead to this mess. Kids covet granite more than financial freedom or mobility. College grads just can’t wait to get mortgaged. Young couples would rather pay double the monthly nut to ‘own’ a condo they don’t actually own at all, than to rent it, and have no debt.

How is this the fault of, say, the Boomers?

It isn’t, of course. Most of the wrinklies are just as screwed as the kids, but with less time to recover. The home ownership rate among Boomers is a staggering 78%, and overwhelmingly they have concentrated most of their net worth in this single asset. In order to get it out and obtain what they really need, which is income, these drugged-up geriatrics in their thirsty underwear will have to bail out of real estate, starting in the next few years.

There’s no choice. Most have little in the way of investment portfolios. CPP pays at best a grand a month and OAS is a measly $537 – nobody can have a decent urban life on that. There’ll be no option but to sell, downsize or rent.

And who will be the buyers? The kids, of course, over-educated, underemployed and asset-poor. They will not be able to afford the prices the Boomers ask, which means those prices will fall. This is one reason the long-term future of real estate is troubled, and a lesson in how economic imbalances are corrected.

Between now and then, expect volatility, confusion and contradiction. The process won’t be quick or clean. Prices will look impenetrable, until suddenly they’re not. Sellers who wait will suffer, to the benefit of buyers doing the same. And in the absence of a healthy and growing middle class, fueled by new investment and stable, lucrative jobs, the speed of change will shock countless Boomers.

They should count on losses. But no pity.

208 comments ↓

#1 TurnerNation on 07.10.13 at 7:29 pm

Life on NS time I guess.

#2 Randy on 07.10.13 at 7:30 pm

Thanx Garth…They don’t give this insight in school…

#3 KG on 07.10.13 at 7:33 pm

Specially when boomers are so asset only rich .

#4 Wizard of Oz on 07.10.13 at 7:39 pm

Dear Garth,

I saw that the US recovery was so well under way that I waited for markets to close and then announced an end to QE. Ha! That’s better than any “knock, knock” joke – gets you everytime.

But seriously, I had to confirm I would keep up the QE. Hope you are okay with that.

Don’t blame me. I had to do it. Those jobs that we told you about – turns out they were part time itinerant fruit picking jobs that we misqualified as “professional” and, ahem, retail. My bad!

But if you are rolling on the floor now, just wait, because there is more. Wait for the GDP revision joke. It is even better.

Good after hours action in the markets though. Stocks up, which would be good for your diversified portfolio. But bonds, precious metals, and oil were also up. You see now It is just QE inflating all assets. Nothing to do with recovery. Just me pulling levers. And that is the best joke of all.

I make a statement and the cowardly lion goes running, the tin man is out of a job and the scarecrow burns in the heat.

I really hope you and Dorothy get back to Kansas.

Yours always,
Ben “Oz” Burr Nank

#5 screwed on 07.10.13 at 7:40 pm

Who cares? Low rates are here to stay. Buy now or be priced out forever. Everything is on sale if you have good credit and leverage. Central banks are in no position to make any moves upward. See Bernanke’s statement today. Taper is almost certainly and officially off the table.

Bernanke said: “Highly accommodative monetary policy for the foreseeable future is what’s needed in the U.S. economy.” That in no way means bond-buying will not start to taper in the months ahead. — Garth

#6 peter s on 07.10.13 at 7:41 pm

ok we r screwed. but america and europe are better?
much of the world is moving to 2 distinct classes.
yes i am a gold bug —forever. u know why
i have history on my side.

#7 Dean Mason on 07.10.13 at 7:48 pm

There is another way the wrinklies or boomers can get cash from their homes.They can get reverse mortgages instead of selling.This will slow down real estate price declines but not stop it.

Any RRSP’s the younger generation had were used for down payments for buying real estate and then they could not save because they had real estate sucking up all their money.Workplace pensions are disappearing for decades like the dodo bird.

People are all living in the land of work,buy the biggest house,paid it off in 25,30 years and sell it for a big capital gain income tax free and retire.It never will work.

Reverse mortgages are a miserable idea. Costly, clumsy, crippling instruments. — Garth

#8 nubbers on 07.10.13 at 7:49 pm

pete @6

‘yes i am a gold bug —forever. u know why
i have history on my side.’

Ur superior education has persuaded me.

#9 Chris on 07.10.13 at 7:49 pm

When I was in my 20’s and 30’s, I struggled with low income, high student loan debt, etc. It wasn’t until my late 40’s that I started to see some savings traction. If someone is in their 40’s and 50’s struggling, I feel for them. But to complain about not having a lot when you’re not even out of your 20’s…isn’t that called a normal life for almost everyone?

#10 The Prophet Elijah on 07.10.13 at 7:50 pm

Bernanke said: “Highly accommodative monetary policy for the foreseeable future is what’s needed in the U.S. economy.” That in no way means bond-buying will not start to taper in the months ahead. — Garth

———————————————————
Could this be a bull trap in gold’s move. Tough call.
Should we hold our gold or sell into the rally?

That’s your problem. This is not a gold strategy blog. — Garth

#11 Smoking Man on 07.10.13 at 7:52 pm

#133 sciencemonkey on 07.10.13 at 1:40 pm

Things are tougher for every Gen, with each graduating class from school the more refined and tuned the machine makes it’s slaves and dogs. Soon Security Guards and sweepers will need a university obedience certificate to get a job.

Today Just as many opportunities to make loot for every Gen, only difference your belief system, Y’s are into collectivism, boomers, individualism, we had Bob Dylan, Pink Floyd, Zep, Moody Blues.

The world is a stage, and you can pretend to be anyone, if you play your role well, it becomes a fulfilling prophecy. I won the Best actor drama award in high school two years in a row. I can where any hat. And I have worn many.

Never in the history of mankind has there been a so emasculated , obedient pool of young fools, who think the certificate makes them smart but settle for poverty wages. They are yours to exploit and enjoy. They will hate me for this post but its more honesty than you will ever see in your life, and from a Diabolical liar.

Never been a better time to own a business, and own slaves.

All you need is a good idea, doesn’t even need to be great, need a partner or investor, go to Bymark, or Ki make friends with the waitress, find out when the movers and shakers come in let them get looped and hit them with your idea. Get funding. Might take a while for the right connection but it’s doable. Hire slaves to do all the work. You do nothing, other than walk around like your shit don’t stink, fire people once in a while to keep the potential alpha’s at bay.

Business is so easy if you do it right. You start getting involved micro managing you will screw thinks up. Profit generation is the slaves job, yours is to fire and replace them when it don’t happen.

That’s how its done.

Very Easy

#12 Wizard of Oz on 07.10.13 at 7:55 pm

DELETED

#13 anon on 07.10.13 at 7:59 pm

This is all mental masturbation ignoring the fact that demographically the middle class is simply going extinct. No babies in middle class millennial houses just cats and dogs.

stop having babies and you go extinct. Simple.

#14 TurnerNation on 07.10.13 at 8:03 pm

Symptom of a down:

(Richer than we think!)

“The Globe and Mail reports in its Wednesday, July 10, edition the Competition Bureau is accusing Leon’s Furniture ($12.35) and its Brick unit of deceptive marketing with their “buy now, pay later” promotions. The Globe’s Jeff Gray writes that such promotions, the watchdog alleges, actually require upfront fees. The allegations carry the possibility of a maximum $10-million fine for each company. In its court documents, the bureau included a sample ad that said customers would pay “absolutely nothing” for up to 21 months. The bureau filed a civil action in Ontario Tuesday alleging the results of an investigation into the companies show that the fine print can require customers to pay various upfront “administrative, processing or membership” fees. For example, the bureau alleged that a customer wanting to buy a $1,500 sofa with no money down could end up paying more than $350 up front. No allegations have been proven in court. In its court filing, the bureau calls the no-money-down pledges “false and misleading” and demands the retailers stop and reimburse “current and former customers” the extra money they paid. Leon’s Furniture acquired The Brick earlier this year.”
© 2013 Canjex Publishing Ltd

#15 Clint on 07.10.13 at 8:07 pm

Hope you ladies took off your shorts (in the metals) like I suggested on Sunday…

#16 T.O. & GTA blinding wars debunked July 10 -in average everything sold under asking on 07.10.13 at 8:10 pm

http://recharts.blogspot.com/2013/07/gta-condo-sales-july-10-average-sold.html
http://recharts.blogspot.com/2013/07/gts-sfh-blinding-wars-july-10-average.html
http://recharts.blogspot.com/2013/07/to-sfh-market-is-going-down-drain-july.html

#17 Shiny on 07.10.13 at 8:10 pm

Here’s a head scratcher! Got a call from [email protected] (TD). She is trying to switch me from my LOC to a locked -in 1 year mortgage. And her motivation is to save me money??? What up? Anyone else getting similar solicitation? Colour me suspicious.

#18 Freedom First on 07.10.13 at 8:11 pm

Garth, the simplicity of your message about having balance, diversity, and liquidity with regular re-balancing is fool-proof. Especially, when throughout your blog you have spelled out the % of the portfolio to have in the different asset classes: : RE, fixed income, equities, cash. Not only that, but you break down each asset class with all the information needed to invest in each asset class with the ultimate conservative, non-speculative investing principles of the truly wealthy.

There will always be the people who are open to learning the truth, as there will always be the fools. The 2,000 year old saying “You can beat a fool half to death, he will still be a fool” is as true today as it was then. I have tried to help my friends and relatives who needed help, and I realize the fools only ask for help after their decisions have bankrupted them. Unfortunately, this truth is being seen world wide today like never before. Hence, the self-pity, selfishness, blame, criticism, and judgmental character flaws of people unable to admit their own foolishness, is running rampant. My advice to the wise, keep a low profile, as the guilty will hate you, and verbally attack you with their envy and jealousy, another one of their negative attributes. Garth points them out here, but he is much more polite than me.

#19 KG on 07.10.13 at 8:16 pm

Garth, Do you want me to teach gold history to #6 ?

#20 Donald Trump on 07.10.13 at 8:21 pm

Of course, these are better-educated workers, since today only crossing guards and strippers (at least the bad ones) don’t have arts degrees. Garth

=====================================

You forgot to mention all the PhD’s driving cabs.

Nothing more enjoyable discussing Quantum Physics vs Maple Leafs as the meter is running. Best way to avoid giving a tip !

#21 Mike T on 07.10.13 at 8:31 pm

This post probably best exemplifies the idea that Earth is a school for us humans. So much deception and mis-direction….

Mr Turner, you hit on all the points the ‘doomers’ use to push their agenda, yet there is nothing doomer-istic about your post.

I am just me (no kids, wife, mortgage) and I am grateful for the experience that is un-folding in front of us. Very happy to have a front row seat.

Once again, Mr Turner, you are the lighthouse in the fog of dis-information. Thank you.

#22 AK on 07.10.13 at 8:35 pm

#10 The Prophet Elijah on 07.10.13 at 7:50 pm
“Could this be a bull trap in gold’s move. Tough call.
Should we hold our gold or sell into the rally?”
——————————————————————–
Hold on to your Gold. It’s heading to $10,000.00. Peter Schiff said so.

#23 Cowpie on 07.10.13 at 8:37 pm

Had this discussion with a financial friend yesterday. He says Boomers are “waiting for their parents to die” in order to cash in on the assets of the “Saver” generation.

He thinks this will allow them to ride out old age and stay in their homes longer, reducing a real estate crash from too many properties dumped on the market at once…

#24 Toronto condo sales -damn lies - July 10 on 07.10.13 at 8:40 pm

http://img849.imageshack.us/img849/4927/9oe3.jpg

#25 saltpony on 07.10.13 at 8:43 pm

#7 Dean Mason

Sure they could get a reverse mortgage to access some of their equity, but their gas-sucking pig of a house will consume it all in maintenance, upkeep, taxes and fuel.

#26 Efficientsense on 07.10.13 at 8:47 pm

I agree with #9 Chris. I struggled, I saved, I started working part time when I was 13 making $3.15 an hour minimum wage. You have to start some where and work hard and smart. Make contacts.. Learn to be financially literate. Be happy with what you have instead of whining about what you don’t have. I hear guys at work complaining they have to spend 15k for an engagement ring and another 30k on a wedding. Then they have to buy a new house because they are not handy and they think they deserve a new house.

#27 Vancouverite on 07.10.13 at 8:47 pm

Garth,

The mayor of Vancouver is selling his house – not a big deal, it’s incorporated and his his wife is the only director.

http://www.vancouversun.com/news/Vancouver+mayor+million+home+sale/8642797/story.html

Can you do a future write up on the benefits/pitfalls of incorporating one’s house.

You do not incorporate a house, you simply buy a house through a small business you own. Many people do so, and are taxed annually on the imputed benefit (rent). — Garth

#28 A Yank in BC on 07.10.13 at 8:47 pm

He’s 29? And bemoaning the fact that he cannot afford to purchase a house? Gimme a break already! When I was his age 31 years ago, mortgages were 18%, inflation was close to 10%, and I couldn’t afford to buy a house either. Hardly anybody could at the time. He should be counting his lucky stars that he was born when he was.

My advice to him is to grow a pair.. and grow-up as well.

#29 TakingResponsibility on 07.10.13 at 8:48 pm

“Being ‘middle class’ is overwhelmingly equated with owning real estate. But if that were the sole measure, we’d have one of the most impressive middle classes in the world.”

*This Myth is key.

Excellent blog post. : )

#30 CrowdedElevatorfartz on 07.10.13 at 8:56 pm

@#18 Shiny

Your statement, “She is trying to switch me from my LOC to a locked -in 1 year mortgage”

Geez man ! How much do you owe on your LOC to have a bank want to roll it into a 1 year mortgage?
Whats the difference in interest payments? Higher? Lower?
Can you pay it all off in 1 year? Or will you renegotiate next July for a higher rate?

Banks dont do anything for your benefit……..

#31 joel Einhorn on 07.10.13 at 9:02 pm

Bought my 30 year old house in the Dufferin and Glend Shields area. I baught it in may for 679000 cash. I rented since 2009 and probably over paid by at least $ 150 000 , listening to Garth. Worst mistake I ever made in my life.

i had the money but was greedy and listened to Garth. You probably won’t post this. But you can contact me through my e mail and ill give you my cell number and all info.
This is a true story and i can back it up with facts.

thank you

#32 Editor on 07.10.13 at 9:02 pm

#24 He says Boomers are “waiting for their parents to die” in order to cash in on the assets of the “Saver” generation.

Maybe they are, but a lot of those savings are going to pay for health care, daily care, and senior housing as needed given the extended life span. People shouldn’t factor that into their plans, but rather consider it a nice bonus should their parents not require their own money for themselves — which, after all, they saved to provide for their own old age.

In other words, it’s not a plan.

#33 CrowdedElevatorfartz on 07.10.13 at 9:03 pm

@#28 Yank in BC.
Total agreement.
When I was 29( late 1980’s) I had no money saved. Living paycheque to paycheck, rented, interest rates were about 13%. High School diploma,No secondary education.
I decided to stop pissing my money away in the bars (sorry Smoking Man)
and actually pay my debts and start saving.

Does Generation “y” stand for “y”ner?
As Garth says, “Grow a pair”

#34 Josef on 07.10.13 at 9:03 pm

Garth, unfortunately I could not be FIRST!!! tonight, but in your last book Money Road on pg. 241, in the first paragraph TFSA is spelled “TSFA”. To account for this error, and since I have been a blog dog for some years, can I have a copy of your next book FREE?

#35 Smoking Man on 07.10.13 at 9:05 pm

My whole point is, not that anyone cares is.

Back in my dad’s day, a sweeper could buy a house, now that our labour market is completing in a global rink.

Those days are over, less of course you wana get all bloody a get a revolution going. Hardly with all the school ed emasculated men. Good luck.

Self employment and slave owner ship is your only salvation.

We evolve and adapt.. Smokey style…

#36 Roy on 07.10.13 at 9:08 pm

Normalize… not particularly a word Canadians might want to hear.

But Blankfein said rates have to “normalize”
http://blogs.marketwatch.com/thetell/2013/06/13/goldman-sachs-ceo-blankfein-its-not-normal-to-have-2-rates-on-10-year-t-bills/

Take a society addicted to cheap money, a 30 year economic cycle of declining interest rates, and where everyone believes the 5 year emergency low rate monetary policy is permanent. Then alter course when household debt levels have never been more maxed. Disaster

#37 Daisy Mae on 07.10.13 at 9:11 pm

“This is the nightmare scenario that the Bank of Canada and the elfin deity worry about. It’s exactly why they trashed 30-year mortgages, slapped CMHC around and told banks to stop lending to anyone with a pulse.”

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

How about that? The ‘elfin deity’ is worried about the mess he created….and is now attempting to correct? Amazing!

#38 Smoking Man on 07.10.13 at 9:12 pm

I hate the term middle class, lower class, upper class.

I don’t see classes, I hang with uppers in maskoka every now and then, toothless lowers in long branch, and middles at the tax farm….

In the company of each group, I put on a different hat. I’m an actor after all. I win then all.

It’s how I roll..

In real life I’m the most interesting person you will ever meet.

Creative, individualistic, ego hidden, charming, always have an interesting story from the days events..

But classes mean nothing, pun intended

#39 Dean Mason on 07.10.13 at 9:15 pm

When people are desperate and they can’t get money from selling the house,they have no other option.Desperate times call for desperate measures.

This is especially true when they want to stay in the home but can also get cash they need without selling.In recent years,they reduced the age of reverse mortgages to 55 from 60 to catch more flies in their spiders’ web.

They are capitalizing big time in the U.S. and Canada is going in the same direction.They know that Americans and Canadians have put most of their money in real estate and are not liquid.I agree it’s not a good thing for the homeowners and their adult children,the inheritors.House rich but cash poor.

#40 Piccaso on 07.10.13 at 9:20 pm

Canada pays absolute shit wages compared to the U.S. in my geek industry.

The amount of work is another mind blower, I’m bombarded by U.S. agencies with Instant/Urgent/Needed/Now geek engineer jobs, all of them 100K plus a year.

In Canada I’d be lucky to find some RJ45 cable pulling grunt job for $28 an hour. It’s pathetic!

Yet it costs us twice the amount to live on this minimum wage in Canada and we don’t complain?

WTF !

#41 45north on 07.10.13 at 9:23 pm

At the same time, household debt has grown from just over 100% of income to more than 160%, even as interest rates crashed. The average Toronto house costs 41% more. The average Vancouver house grew 90% more expensive between 2002 and 2007, and has added 60% since.

yesterday a poster “troublesbrewing” talked about the ARM resets in the States being a major threat to the economy. ARM stands for adjustable rate mortgages. in the States the standard is a fixed rate 30 year mortgage. Mark Hanson points out that Canadian fixed mortgages are like ARMs – they are only 5 years. So if interest rates double the effect will be very much like ARMs.

Wizard of Oz: I had to confirm I would keep up the QE. Hope you are okay with that.

pretty funny

#42 prairie person on 07.10.13 at 9:24 pm

I doubt if the kids are over educated. They may well be over degreed but that is another matter. It comes with over indebted. I used to have a sheet of paper that was the equivalent of a newspaper centre spread. On it was a list of jobs and the salary you could expect if you sought and obtained that job. I went through it with my students. There was shock. Most had never considered, or their parents had never helped them consider, the economic consequences of their choices. We also did an exercise in which someone answered the question, what do you want to have after you graduate. Rent, buy a one bedroom, two bedroom apt., buy car, what kind, or a bicycle, what city, what district. We added up the cost. More shock. A lot of the jobs on the list when we cross matched wouldn’t pay for what they wanted. I believe the exercise helped people make more rational decisions. It took the romantic, I want to sit on the dock and sew sails, out of the picture. You see, some people did get some very practical education their family hadn’t provided.

#43 Dean Mason on 07.10.13 at 9:24 pm

#26 Saltpony

Remember,they didn’t care or think about the future costs of utilities,property taxes,repairs and maintenance,insurance when they bought the house.They would rather stay in the house as long as possible where they are comfortable instead of renting a place they are not to fond of.

When they can’t keep the house then they will move.Most people want to keep their lifestyle as long as possible and don’t want to think about the consequences until later when they have to worry about.It’s human nature for most people.

#44 Daisy Mae on 07.10.13 at 9:25 pm

#7 Dean Mason: “There is another way the wrinklies or boomers can get cash from their homes.They can get reverse mortgages instead of selling.”

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

Worst idea ever. The compounded interest on this ‘loan’ –and that’s what it is — will eat up all remaining equity.

#45 Donald Trump on 07.10.13 at 9:26 pm

#28 Vancouverite on 07.10.13 at 8:47 pm

Interesting..Comrade Roberston(who claims he is a relative of Dr. Norman Bethune..Doctor to the Commies) is acting like George Jefferson…”moving on up” to the FAR West Side…enough of the peasant upper middle class.

Typical Cadillac Socialist.

#46 Efficientsense on 07.10.13 at 9:33 pm

#41 – go move to the USA and earn what you think you are owed.. Btw $28/hour is alot of money to me

#47 dosouth on 07.10.13 at 9:35 pm

My first boss told me, “The problem with you young people today is that you want to start where your parents left off…..washer/dryer, microwave, colour TV, house, car. You don’t want to earn it and expect it to just be there.”

1976 – seems such a short time ago but really, it’s different now so the Gen X,Y, hipsters and millennials say.

#48 Honey I'm home on 07.10.13 at 9:41 pm

“Prices will look impenetrable, until suddenly they’re not.”
———————————————————–
Gartho is a good analogy of this how gold defied gravity for a year and a half then collapsed as fast as Russia? Or am I comparing apples to oranges.

#49 Burnt Norton on 07.10.13 at 9:41 pm

Any gen x, y or millenial in this country without some form of health related disability should be fine as long as they are prepared to work hard and take some risks. Too bad many cannot appreciate that they live in as much of a meritocracy as there is on this planet. Canada does not owe you a living.

#50 45north on 07.10.13 at 9:42 pm

Joel Einhorn: Bought my 30 year old house in the Dufferin and Glen Shields area. I bought it in May for 679000 cash.

cash! next to the 407!

which reminds me of a man who bought a house in Ottawa, it would have been Gloucester before amalgamation. I told him it needs a good bulldozer.

you have to take a loss to cut your losses

#51 detalumis on 07.10.13 at 9:44 pm

#33 Seniors are pretty coddled at least in Ontario. You don’t need to draw down your assets to pay for long-term care. The ones that do are the silly ones who fall for the fancy marketing brochures of the uber expensive homes. In my town the public homes are very affordable and better run than the marble lobby palaces with the marketing people writing the menu. The food is the same but it sounds better on paper “crisp lettuce” as opposed to wilted I guess.

It’s also a myth that people live longer now, if you made it to 65 in 1940 before antibiotics and before treatment for most cancer and heart conditions, you only lived about 4 years less than today – hardly a huge extension I would think.

You don’t need great big gobs of money to have your lawn cut or whatnot. By the time you can’t do housework, cook or change your own diapers it’s time to checkout gracefully, $20 worth of Nembutal should do the trick.

That was inspiring. — Garth

#52 Panhead on 07.10.13 at 9:44 pm

#29 A Yank in BC on 07.10.13 at 8:47 pm
When I was his age 31 years ago, mortgages were 18%, inflation was close to 10%, and I couldn’t afford to buy a house either. Hardly anybody could at the time.

————————————————————
I was in the same boat but a year later because of those rates I bought a house for cash in Burnaby. Could easily happen again but with far lower rates this time …

#53 Daisy Mae on 07.10.13 at 9:45 pm

#27 Efficientsense: “I hear guys at work complaining they have to spend 15k for an engagement ring and another 30k on a wedding….”

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

They should try giving their head a shake. Use a Justice of the Peace. Problem solved.

#54 Honey I'm home on 07.10.13 at 9:47 pm

#41 Piccaso:

The amount of work is another mind blower, I’m bombarded by U.S. agencies with Instant/Urgent/Needed/Now geek engineer jobs, all of them 100K plus a year.
———————————————————-
This doesn’t sound right, it’s hard enough as it is to find work in the US, let alone full time 100K jobs. I know a school teacher with a masters degree in Montana making mid 40K.

#55 Eat the rich — Greater Fool – Authored by Garth Turner – The Troubled Future of Real Estate | The Affluent Boomer on 07.10.13 at 9:48 pm

[…] via Eat the rich — Greater Fool – Authored by Garth Turner – The Troubled Future of Real Estate. […]

#56 george soros on 07.10.13 at 9:50 pm

Let me see if anyone can understand this , all time record corporate profits ,fewest people working that can work in 30 years ,record deficits ,the whole world in shambles (riots,flooding ,bail ins bail outs ,middle east wars ,coup de’etat you name it ,record part time jobs record loss of full time jobs ……..) we either need a modern day Robin hood or i need Garth Turner to tell me i’m a doomer lol

#57 Heather Nova on 07.10.13 at 9:58 pm

In replying, you gratuitously insulted the other visitor three times. It would have been possible to make your point without the invective. This pattern of yours will no longer be tolerated. — Garth

Since when did three insults in one comment become intolerable? Five, six, or seven seems perfectly acceptable if the person being insulted is a mortgage broker, a banker, or a realtor. Garth, I’m surprised at your double standards.

#58 George S on 07.10.13 at 10:00 pm

I really enjoy your blog and read it almost every day. I think you are dead on accurate with your advice. I think that people that disagree with your advice don’t understand mathematics.

I found a book in a drawer yesterday that I put away a while ago. It is a book that should cause people to lie awake all night with horrible abdominal pain, getting up every now and then to throw up. Its title is “Monthly Payment Tables on Mortgage Loans” published in 1986. The rates go from 5% to 30%. Only 27 years ago no one could ever imagine a situation where mortgage rates would be even close to 5%. They did think they may approach 30% though. The rates we have been experiencing have nowhere to go but up and people are going to be screwed. People should not be buying houses right now no matter how much rent is. At least when you rent you have mobility and nothing tying you down. You can wait for interest rates to go up and prices to go down.

#59 Smoking Man on 07.10.13 at 10:02 pm

Obama executive order requires federal government employees to learn to spy on co-workers, to prevent more WikiLeaks-type disclosures
…………………………………………..

Unbelievable. So they are looking for characteristics to ID potential whistle blowers, and if you don’t rat on some one you go to jail.

Ba hahahahahah.

Machine has lost it…………

Read more: http://www.dailymail.co.uk/news/article-2359673/Obama-executive-order-requires-federal-government-employees-learn-spy-workers-prevent-WikiLeaks-type-disclosures.html#ixzz2YhLkXW5m
Follow us: @MailOnline on Twitter | DailyMail on Facebook

#60 gladiator on 07.10.13 at 10:04 pm

Ha! I make over 100k a year and don’t even own real estate! What a low-life renter I am… Not even middle-class…
Sucks to be me, I guess.
On the other hand, it’s pretty cool to have no debt and invest my 20k savings per year in whatever my heart pleases. And all this – having a stay at home wife and 2 school-age kids. Budgeting rules!

#61 Honey I'm home on 07.10.13 at 10:08 pm

You don’t need great big gobs of money to have your lawn cut or whatnot. By the time you can’t do housework, cook or change your own diapers it’s time to checkout gracefully, $20 worth of Nembutal should do the trick.

That was inspiring. — Garth
———————————————————–
Nevertheless this is a good point, and reminds me of the Denis Leery joke that he won’t quit smoking cause he doesn’t want to live till 90 “no thanks you can keep the kidney dialysis diaper wearing years”. Sad but true.

#62 Victor V on 07.10.13 at 10:14 pm

PRICE DROP #2 – 500 Wellington St W PH1001 – FASHION DISTRICT

http://themashcanada.blogspot.ca/2013/07/price-drop-2-500-wellington-st-w-ph1001.html

The first time I posted this 3 bedroom, 3 bathroom, 6,500 square foot condo with 2,000 square feet of outdoor space was a year ago in July.

It was listed at $7,500,000 with maintenance fees of $2,241/month.

It was clearly way too high, even if you did love the Transformer Poster fireplace…

At some point between then and when I posted it again in September, it had a price drop.

It was then listed at $6,999,900 or for lease at $35,000/month.

So crazy!

Clearly it hasn’t sold because I just saw that the price is down again.

This time, the price is…

$5,999,000.

Not sure that is going to help.

#63 Piccaso on 07.10.13 at 10:16 pm

#47
– go move to the USA and earn what you think you are owed.. Btw $28/hour is alot of money to me

………………………………………………………………

That’s where reality has left this country, we don’t even blink an eye taking on half a mil mortgage with that $28 an hour job.

This is totally stupid is it not?

#64 Craig on 07.10.13 at 10:18 pm

Garth you write a good story that is supported with facts and that make it very compelling but….

I think you’ve looked at previous generations and what they did at age 55 – 60 -65 and applied that logic to our generation (boomers)

They had CPP and OAS and company pensions and savings. Therefore they could retire. We, in general do not, as you’ve stated and there’s the breakdown in your theory versus mine.

You assume Boomers will have to retire and to do so will have to sell their house.

Not true.

We boomers are a resilient bunch and have worked hard all of lives and are not about to throw it away. We think outside the box, we are creative and will not give up.

We have many options not identified in your post that look at the other side of the coin – not selling our homes.

1 – I have absolutely no intention of retiring and going to the mall every day. I fully plan on working until I can no longer get out the door to do so. I also believe that will be how other boomers will continue to survive and manage to keep their homes. Keep in mind “most” will not have a mortgage at the age of 65 +, so costs are minimal.

2 – Boomers will work and as SM said – #11 Smoking Man – (Very good post SM) we can start our own businesses, reap the tax shelters and tax breaks and we will find that we have more skills and experience then those U Grad kids that want instant gratification versus working for it. It will not be that difficult to make up the difference from our career incomes to our old age income requirements. Everything is manageable and doable if we want it to be.

3 – If we really have a tough time making ends meet we can rent out a room or rent out our basements for a $1000 or more a month. Easy tax free money (shhh) enabling us to keep our homes.

4- There have been many articles written by our Gov’t’s and many others concerned about the fact that boomers will continue to work well into to their 70’s and 80’s. I personally know people right now who are doing just that and not for financial reasons but just to keep busy, keep the mind going, etc., etc. The Gov’ts concern is we will be taking jobs from the kids but hey, it’s a tough world out there and we all know we have to take care of number 1 cause the Gov’t sure won’t.

Garth I wouldn’t be so quick to assume us Boomers are dummies and will eventually lose everything.

This statement is so NOT TRUE!

“In order to get it out and obtain what they really need, which is income, these drugged-up geriatrics in their thirsty underwear will have to bail out of real estate, starting in the next few years.”

Maybe you should write an article on what will happen to renters when their savings in the market isn’t where it’s supposed to be at in their drugged-up geriatric age and they get hoofed out of their rental unit.

No roof over their head and no sustainable income.

Then what?

What are their options Garth….lets switch things around here for a change and give us your honest perspective on the “risks” of renting.

Cheers

#65 Smoking Man on 07.10.13 at 10:21 pm

Smokey Doctor-in

I was working on a door deal with a large Japaneses company, and a Canadian Door mfg back in the 90’s.
Free lance agent.

Was at the Can company office putting some stuff together, sitting at the buyers desk, he was off.

Get a call from the president of a large Tampa mfg of aluminum sills, he wants to talk to Tibby the buyer.

I said he’s not in can I help you. They said they want to invite him down to the fun and sun, golf and boating and talk about if there is a possibility to do some business in the future.

Hum. Light bulb goes off, its Nov and Snowing in Toronto.

I said, I’m his boss, give me your contact info and I will pass it on.

Your his BOSS!!!!!!!!

Best trip of my life, Boating, deep see fishing, Golf, Booze, lap dancers and ladies of the night….

I’m a smoking man. They never did sell a thing, price was to high, but I gave it my best shot….

#66 KommyKim on 07.10.13 at 10:22 pm

RE: #10 The Prophet Elijah on 07.10.13 at 7:50 pm
That in no way means bond-buying will not start to taper in the months ahead. — Garth
———————————————————
Could this be a bull trap in gold’s move. Tough call.
Should we hold our gold or sell into the rally?

Sell into the rally of course! The next time the markets (Gold-Bond) hear one whisper that QE is being rolled back, tapered, ended, etc, they will fall further.

RE: #14 anon on 07.10.13 at 7:59 pm
stop having babies and you go extinct. Simple.

Over populate the environment with one species (pick one) and you get the same result. Simple.

#67 Piccaso on 07.10.13 at 10:25 pm

#55 Honey I’m home on 07.10.13 at 9:47 pm
……………………………………………………………..

It is true, the LTE push is on in telecom with the ever growing data usage. Who owns a flip top cell phone and just talks on it now… nobody.

There all out there with their BlackBerry’s and Ipads surfing, snapping, texting, downloading and talking as there walking and driving.

Urgent… Nokia, Ericsson, Alcatel, Lucent, ZTE, Huawei, engineers needed !!!

#68 Godth on 07.10.13 at 10:29 pm

“How is this the fault of, say, the Boomers?”

funny, I’d swear I’ve read terms like “child abuse” thrown around more than once regarding ignorant boomers encouraging their kids to buy into a housing bubble, where did I read that again…

in any case, yes Sherlock, we are screwed. the sun still shining, the birds still singing and humans are still full of_____.

#69 rosie "moving forward" on 07.10.13 at 10:37 pm

#60 smoking man

Your choice of sources is inspired. You might consider pursuing this as a profit maker, ka-ching. http://www.dailymail.co.uk/femail/article-2359590/Would-cast-brass-How-turning-bits-body-art-new-middle-class-trend.html

#70 Devore on 07.10.13 at 10:44 pm

#18 Shiny

The only two reasons, and two reasons only, your bank will call you is because you either didn’t pay your bills, or the bank thinks they can make more money off you than they are making right now.

#71 Canadian Watchdog on 07.10.13 at 10:46 pm

#27 Efficientsense

I started working part time when I was 13 making $3.15 an hour minimum wage. You have to start some where and work hard and smart.

Sometimes I have to explain this in real life terms for people to understand how different it is today. Canada's average minimum wage was $3.12 in 1980 while the average national home price was $73,169. That's 23,427 hours of labour (2.67 years) to purchase an average home. In 2012, minimum wage was $9.57 while the average price was $363,736. That's 38,018 hours of labour (4.33 years) and a real increase of 62% compared to 1980.

This is absolutely unsustainable. As the following chart shows, at the exponential rate of increase for GTA homes, there would no houses, semis or condos available under $500,000 by the end of 2020.

Despite what Garth thinks, Canada's market is heading for a major crash at some point. It's inevitable.

#72 Smoking Man on 07.10.13 at 10:49 pm

#64 Craig on 07.10.13 at 10:18 pm

Nice, very good observation….

#73 Mr. Monday Night on 07.10.13 at 11:00 pm

#58 Heather Nova on 07.10.13 at 9:58 pm

Since when did three insults in one comment become intolerable? Five, six, or seven seems perfectly acceptable if the person being insulted is a mortgage broker, a banker, or a realtor. Garth, I’m surprised at your double standards.

—————————————————————

This rant is in response to something that was posted yesterday. Either have better timing with your responses or learn to let things go.

#74 Devore on 07.10.13 at 11:03 pm

#55 Honey I’m home

This doesn’t sound right, it’s hard enough as it is to find work in the US, let alone full time 100K jobs. I know a school teacher with a masters degree in Montana making mid 40K.

Plenty of work for people with the right skills willing/able to relocate. Most un- or underemployed are neither of those.

#75 EIT on 07.10.13 at 11:20 pm

Only another war will prompt a true recovery for the empire.

#76 Robbie on 07.10.13 at 11:23 pm

#32 Joel Einhorn

Real Estate prices do not rise or fall the same in all areas and Garth has mentioned that many times and as a Realtor I have seen that. Currently I am seeing homes (Greater Victoria area) offered for sale for less than the owners paid for them 8 or 9 years ago. Most assessments have dropped 20 to 30% over the past few years….higher priced homes having the greater % drop. It is all location dependent so don’t blame Garth that he can’t give you a prediction for every location. Even in the Greater Victoria area, some homes have had their assessments rise because the location or acreage is in demand.

#77 Donald Trump on 07.10.13 at 11:35 pm

Old Man:

I got a text from Juan Valdez….

He’s asking you not to hang around Tila’s Taco van looking for a date.

#78 retired WI Boomer on 07.10.13 at 11:35 pm

#122 KC (7/10/13 posted on yesterday’s column).

YES. I saw the Frontline documentary on PBS.
A fairly accurate depiction of life in Milwaukee, WI (and a good part of the manufacturing states here in the mid-west). The circumstances that lead to this were a combination of off-shoring, cost cutting, free trade induced policies. Ad in Bankers gone wild, world competition for the U.S. standards of living -sometimes a dubious aspiration- and you get the next generation doing worse.

The black family is doing ok, they stuck it out, did the best they could do. Their kids fared best overall. The white family dissolved in divorce, the kids doing not as well. 2 of their 3 never finished high school.

Did you notice that the children of these “boomers” were overall doing much worse (for their ages) than their parents were in the early 1990’s?

Did you further notice only ONE child out of the 8 depicted had completed a 4 year college? Did you further notice that only one other child had completed a 2 year technical education. 2 children dropped out of high school. The rest merely high school graduates.

When the “competition” for the available good jobs comes better prepared you are SOL.

None of these kids was “selling” generally a ticket to a higher than average income. Hard work, but a good salesperson generates a lot of open doors, regardless of their academic credentials.

None of these offspring seemed to illustrate the characteristics of a “SMOKING MAN” who generally outperforms. Too bad, losers a dime a dozen regardless of the economy. YOU make 90% of your life through your choices, the other 10% is timing, and luck.

This is NOT a political announcement, I have no agenda.

#79 Snowboid on 07.10.13 at 11:36 pm

#55 Honey I’m home on 07.10.13 at 9:47 pm …

We have met dozens of Canadians working in the Phoenix area making well over $ 100K annually. They all work in IT, many for Canadian companies that moved their HQ to Arizona.

I imagine it’s the same in Texas as Piccaso has suggested.

The bonus is living costs close to 50% of Canada!

#80 Valerie Keefe on 07.10.13 at 11:39 pm

How is this the fault of, say, the Boomers?

Ten years ago, when I was 20, and in college, taking economics and political science (in that order) I worked nights at a gas station. And back then, when gas hit the outrageously high price of seventy cents a litre, I would invariably get hit with the question:

Why’s gas so high now?!

Normally you’re not going to run into someone working the graveyard shift at a gas station who has the perfect education to answer that question, but here I was, and my answer was thus to every boomer and early X-er starting to add some salt to their peppery hair:

Did you vote for Turner in ’84?

And invariably there’d be a moment of confusion, a sputtered no and the look of hurt as I, festooned with crap-eating-grin told them, quite simply, that that was why.

Yeah, it’s the boomers’ fault. Sorry, but they voted wrong. They elected governments more interested in defunding two dimes a year worth of genital reconstruction than in ensuring wages bore any resemblance to productivity.

They gleefully elected governments that put the hammer to welfare recipients instead of employing people to put the hammer to the kinds of public housing projects that helped keep the housing market sane.

They took one of the most beautiful welfare states in the world and chipped away at it, bit by bit, because those policies sounded good to those driven by the haunting fear that someone, somewhere is having a good time.

They gleefully re-elected mayors who presided over 50% increases in the median house price over their terms, demonstrating that the Marxists, if nothing else, at least had a point about Maggie Thatcher making voting clients of would-be homeowners.

They made the hiring decisions that dictated that every hire who had a hope of a middle-class job was going to have to have a post-secondary degree in a world where so few people actually use said degree in their middle-class sinecures. They inflated credentials and cut tuition funding and then sneered at the kids who couldn’t work their way through school with a summer job anymore.

It’s little consolation to us that boomers cut their own throats in cutting ours. At least they enjoyed a productivity-wage ratio we’re only going to dream about.

#81 Snowboid on 07.11.13 at 12:06 am

#64 Craig on 07.10.13 at 10:18 pm…

Sounds like you are rationalizing your future based on decisions you made (or didn’t make) in your younger years. There is nothing wrong with that, but almost everyone I know working past 65 isn’t doing it by choice – they can’t survive otherwise.

If you are over 65 and can still manage the rigours of starting and running a business – good for you – hopefully you would actually make money.

Rent out your ‘basement’ – sounds like easy money but it isn’t – and doing it under the table? May as well try and make your shortfall in Vegas as that would be less risky.

We are renters in Canada and owners in the US and sold our Victoria mini-McMansion in May 2010 – now spend summers in the Okanagan and winters in Arizona.

We will happily sit on the invested proceeds and may never buy again as long as rents are so low in the Okanagan.

We have met many Canadian boomers down south who have done the same, selling and renting in Canada – but buying in AZ.

And we certainly love the freedom of retirement and having the financial ability to pretty well do what we want. Mall visits are few and far between.

I’m sure there are risks to renting, but no more than owning (and the associated costs) in the Okanagan.

By the way, all of the property managers we know in the Okanagan prefer renting to drugged up geriatrics!!

#82 Dean Mason on 07.11.13 at 12:28 am

#45 Daisy Mae

So was people buying the most expensive house possible that the bank,lender would give a mortgage for leaving no money left over for savings,investments,RRSP’s,TFSA’s,RESP’s etc.

They took out 35 to 40 year amortization mortgages,refinancing the house’s equity over and over like an ATM machine,racking up credit card debts,car financing to 96 months,car leasing every 4 years,student loans of $50,000 plus being paid over 20 years,using gas and department credit cards charging them 28.80% yearly interest.

Yes,these are not the worse ideas.They are but people still do it over and over.Most of the Canadian population is like this.It’s a sad fact.

#83 It is not insult it is replying to insult on 07.11.13 at 12:29 am

In replying, you gratuitously insulted the other visitor three times. It would have been possible to make your point without the invective. This pattern of yours will no longer be tolerated. — Garth

Since when did three insults in one comment become intolerable? Five, six, or seven seems perfectly acceptable if the person being insulted is a mortgage broker, a banker, or a realtor. Garth, I’m surprised at your double standards.

Actually the Realtors, the mortgage brokers and the bankers insult our intelligence every day with their RE pumping up. I guess it is hard for you guys to accept that there is a site where we can call you on your names without being censored. As for double standards look who is talking

#84 anon on 07.11.13 at 12:32 am

Despite what your social teacher taught you the west is not overpopulated

#85 Mr. Monday Night on 07.11.13 at 12:41 am

#64 Craig on 07.10.13 at 10:18 pm

“Lets switch things around here for a change and give us your honest perspective on the “risks” of renting.”

—————————————————————–

Okay, so let’s discuss.

As a renter, one does not have anything to sell in order to move. Given, there is no risk nor reward of selling a house. I feel that based on the way the economy and market are going currently, financially speaking, renting is a zero-risk, zero-reward option relative to owning. Yes, you could go through life paying some landlord’s mortgage for them, but in the end, you pay what you pay. You get no windfall to set yourself up, but you won’t have to bring a cheque to the closing if you have to sell at a loss.

As a renter, one has the option to move if the rent gets too high, again with no waiting to sell the primary residence. This one gets kicked around a lot, as people suggest that all landlords are collusive scumbags who will band together with their competitors to price their rentals higher and higher as the tenancy goes on. This is a falsehood, as they can only go as high as people are willing to pay. I am currently locked into a three-year lease with the caveat that if my rent increases without substantiation, the landlord has lost a top-notch tenant who always pays the rent on time and takes good care of the house. Maybe I’m replaceable – maybe not. How many landlords are willing to take the chance, as one month of lost rent negates two years worth of rent increases? I have mentioned before a friend who stubbornly let a rental sit dormant for ten months because he did not want to lower the rent and take a hit on the mortgage – resulting in a $30K loss to chase down a renter, and still takes a $500 haircut / month on the mortgage.

You assume that boomers are all sitting on untapped gold mines right now in the form of their homes, which can be sold at any time for massive gain. Again, maybe that’s true and maybe it isn’t – all depends on who’s buying. If the average Canadian household can’t buy the average home, they just won’t. It’ll just be accepted that homes aren’t affordable anymore. You are starting to see this in every major Canadian city as the inventory piles up. People still think that there’s no upper limit to this madness, but the a** is truly falling out. Everyone hits their own personal saturation point for affordability and we’re all likely nearing it, regardless of location. How many of the sellers right now are non-speculative and have a true need to sell, and how long can they hold on before the dam breaks? Don’t sell me on any BS vision of North Americans having multi-generational families living under the same roof either – it just won’t happen. Kids want to move out of their parents’ houses, trust me.

If rents go above the capability of people to pay, they’ll be forced to explore cheaper options. However, don’t tell me that rents will go above the reach of the average household, if that happens who will be the renters?

Inevitably, it boils down to personal choice, and those who want to have stuff are going to have to pay a premium right now or be very patient. On the other hand, people who want to DO stuff can just settle on renting and saving their dough.

#86 Steven on 07.11.13 at 1:11 am

How is this the fault of, say, the Boomers?

Answer: They helped to jack up real estate prices and set a very bad example for younger people to follow when it comes to how much to pay for a house and putting women in the work force to raise more money to pay more for houses. Every time house prices rise home ownership moved further out of reach. Have any of you spoiled twits considered the consequences of your greed? You all are about to find out the hard way.
Your whining about low birth rates and no buyers for your overpriced shacks, I don’t want to hear it. Your economic,sexual, legal and political perversions offend me. Judgement day is coming.

#87 a prairie dawg on 07.11.13 at 2:02 am

Bernanke said: “Highly accommodative monetary policy for the foreseeable future is what’s needed in the U.S. economy.”

– – –

It’s amazing how gullible most people are. They see something in print, and if it approximates their own opinion, they accept it as fact and repeat it as such.

Except they didn’t take the time to analyze the wording that was used. The Bernanke quote is a classic example. “is what’s needed” doesn’t mean the same thing as “is what will happen.” But it makes most people reading it think that it does. Get it? The media and politicians are masters at this. But this example was phrased as a suggestion, not a decree. So it opens the door for them to go either way.

Start analyzing what you read in the news with a healthy skepticism instead. Don’t assume it’s truth. Assume it isn’t. Look at the exact phrasing of the words used. You’ll get to a point where you can start to filter out the bullshit in the everyday world, from the facts.

Use that head for more than holding your toque, eh?

#88 Alberta Guy on 07.11.13 at 2:17 am

i have to agree with #64 Craig. Boomers will just work longer to keep the house.

http://advisorperspectives.com/dshort/commentaries/Aging-Labor-Force.php

#89 Blacksheep on 07.11.13 at 2:19 am

TPE #10,

“That’s your problem. This is not a gold strategy blog. — Garth”
——————————————————-
It’s a little late for that Garth. You’ve been ‘bringing out the Gimp’ on a regular basis lately as you’ve enjoyed it’s predictable decline. Now it shows a bit of strength (before it continues it’s decent) and the topic is taboo again?

#90 WiseGuy on 07.11.13 at 2:21 am

#58 Heather Nova on 07.10.13 at 9:58 pm

With regards to your comment above…I was the one that was insulted yesterday and Mr. Turner so graciously came to my defense. You can read my comments yesterday and I am not a mortgage broker nor a real estate agent.

In fact, yesterday, I pointed out the fact of which Garth has been saying for a long time…too many boomers with all their net worth in their homes and no retirement savings will be forced to sell in the next 5-10 years. In addition to this, there are thousands upon thousands of 20 something year olds that have graduated with degrees, but can’t find jobs and in addition are in serious debt. These young kids would be the natural ones to start buying these homes off of these boomers, but the reality is that they won’t have the money.

So, in effect, prices will have nowhere to go, but down.

Those were the comments that I essentially said yesterday and the an over enthusiastic person on this board insulted me at least 3 times, which I don’t mind in the slightest, because I know I’m right!

P.S. I was one of the last ones to get my power back on here in Toronto this afternoon, but so glad that I don’t live in a flooded condo…..wouldn’t want to have to pay an increase on condo fees in the next couple of years due to water damage would i….

#91 groovin_123 on 07.11.13 at 2:33 am

Oops.

Did the Bernank just show his hand today to Mr.Market? Wow, I’m shocked, just SHOCKED, that the FED is in no position to begin “tapering”….

Seriously, this is all now bordering on a circus.

You have 2 options Mr.Bernank. One is, you print money until your currency is devalued enough to the point where you have no trade imbalance. At that my friend, is a long way down from here. And it takes time – time that continues to tick away while your federal debt builds. Option Two is, you “taper” and cease all market intervention. Interest rates spike to 6-7% like your European pals overseas and your country hits one hell of a recession. I’d say it’d border on depression, but doctored employment headlines would hide that…. participation rate? What, me worry?

Honestly Bernank, option 2 is better in the long run. Tear the Band-Aid off, collapse and rebuild.

It’s all coming to a head here and now, grab your popcorn. Some of the best traders in the world that hedge for Canada’s largest private company (you can figure it out) give it until 2015 and maybe it does push that far. I am thinking at this point, even the sheep are beginning to figure it out although this blog sure hasn’t.

Go long REITS in 2012 was the mantra here. How’d that work out?. Pffffff.

Skip the headlines kids, check out the big picture.

#92 Peter on 07.11.13 at 2:35 am

“And who will be the buyers? The kids, of course, over-educated, underemployed and asset-poor. They will not be able to afford the prices the Boomers ask, which means those prices will fall. This is one reason the long-term future of real estate is troubled, and a lesson in how economic imbalances are corrected.”

Not to mention that there will be a hell of a lot more sellers than buyers just because of demographics!

#93 Buy? Curious? on 07.11.13 at 2:41 am

Gawd damn Baby Boomers!

Here is George Carlin’s take on frickin’ Baby Boomers.

http://www.youtube.com/watch?v=o1Sal6N5OiE

I know I’m going to get old but I’m not turning into someone who was born from 1948 -1970 who have become walking stereotypes.

Read any stories lately about Canadian heroism? Notice Justin Bieber was filmed peeing in a kitchen?

#94 Craig on 07.11.13 at 7:32 am

Blaming Boomers for everything that is wrong today is a hilarious. In fact it’s just the opposite.

We changed the world starting in the 60’s to now. We didn’t sit in the basement playing computer games eating big macs.

What has this generation done except complain they don’t have all the stuff we have.

———————————————————–

Gold has bottomed, time to buy the stocks this summer

Regardless of all the noise QE is coming this year and next and…..

Real estate is dropping not crashing. Dream on renters, no matter how hard you bash home ownership, to convince yourself that renting was the right move, you will always lose. Just ask 78% of us Boomers.

Market correction, in a big way, coming your way in the Fall. Be prepared. Balance into cash… :)

I hope Zimmerman and Hernandez share a cell for the next 20 years. You can’t just kill people, because !

#95 pbrasseur on 07.11.13 at 7:32 am

Nice post today, sums it up pretty well.

The goods new is many boomers will end up working a lot longer than they figured, this should help our ecomomy.

#96 Chickenlittle on 07.11.13 at 7:46 am

Re all of the older and wiser people on this blog:

I am 34 and I have to admit that some of the best times in my life were times where I had no money, had nothing, and it didn’t matter. I had SO much fun!

The more stuff, the more upkeep, the more money spent.

I wish people my own age didn’t care so much about what others think. They say that they don’t, but their actions say otherwise!

#97 ponerology on 07.11.13 at 7:53 am

This line of argument is very interesting and was as an argument against expanding defined contribution pensions since the generation after the boomers will be forced to buy overpriced stocks which have little chance at going up in value, at least those who are lucky enough to have any kind of pension plan. I never thought of applying the same logic to real estate but it actually makes even more sense here.

#98 benf on 07.11.13 at 7:53 am

Lots of typical posts here. Boomers who used to work 14 hour days down mines for 10 cents and paid 18 interest their whole lives. Boomers who only know young people who treat ipads as disposable, buying a new one each day.

How did this generation, who have massively increased the national debt, get to consider their reign a success? We can all “work hard” whilst making our grandchildren pay our bills.

The sense of entitlement coupled with poor maths and a dislike of the “lazy” youth is potent.

#99 Morgan on 07.11.13 at 7:59 am

#81 Valerie Keefe – I agree completely. We were hiring for an admin job this week, over 300 applicants. 95% have university degrees, while 20 years ago all you would have needed was a typing certificate. Industry complains about kids not being workplace-ready, but entry-level jobs have been turned into unpaid internships and basic jobs now need a $50K degree just to get on the short-list. When education doesn’t bring class mobility, that’s the end of the middle-class because yes, reproducing is now a luxury hobby that few can afford anymore. So where did the money go? Everyone can feel it being extracted, but only Occupy finally pointed the finger to the 1% and their government buddies who revise the policies that benefit them. We get the health care we pay for and we get the retirement we pay for – and both of those things are almost impossible to plan for and fund on your own. But we’ve been conned out of pooling our money together to manage risk because we can’t trust the politicians to not just hand over our money to the rich. It all comes down to who you vote for.

Instead of mere venting, let’s have some evidence of ‘politicians handing over our money to the rich.’ And how, exactly, does that relate to young people flocking into arts degrees while plumbers drive Audis? — Garth

#100 jerry on 07.11.13 at 8:43 am

The two asset classes that never ever go away are “emotion” and “greed”.

#101 Spiltbongwater on 07.11.13 at 8:50 am

If it wasn’t for Obama and letting the illegals stay in the USA, they would not have any Mexicans making their tacos and the Americans will have to pick their own fruit and cut their own lawns.

And we care, why? — Garth

#102 Mongia on 07.11.13 at 8:52 am

Garth…you are the saviour..!!!

#103 Smoking Man on 07.11.13 at 9:08 am

#104 Mongia on 07.11.13 at 8:52 am
Garth…you are the saviour..!!!

Seriously…

OK if your a chic, I get it, his greying beard does something for you..

But if your a dude, did you grow up without a father, guys don’t suck up to other guys.. We chirp. It’s a man thing to do.

#104 CrowdedElevatorfartz on 07.11.13 at 9:14 am

@#87 Tony from Cowtown
As I said before “Y”ner

#105 CrowdedElevatorfartz on 07.11.13 at 9:27 am

@#87 Tony the whiner
Your statement: “people of your generation could score a great paying job without university education”
I was born in the early 1960’s so I was stuck at the tail end of the Baby Boom” When I reached working age ( late 1970’s) we were in a rescession, high interst rates, unemployment was brutal. I had zero working skills and a highschool education. I worked minimum wage jobs because thats all there was. None of the Boomers older than me were quitting their jobs sooo every job I got was the lowest.
I did that for almost 10 years until I relized I need to “upgrade’ went to night school and correspondence.
Slowly clawed my way up.
I also kept living within my means, NEVER went into debt for a useless university degree that sont garuntee me a job( why should it? If you have a Bachelor of Whatever and zero job skills why should anyone hire you? Your just like all the rest of the whining fools that got sucked into your parents dreams)

As for the whine about the “ponzi scheme” of the markets.
Gee sorry, but it seems that most graduates today are in economics, law, accounting. All the same scum that have learned “better ” than their parents at how to “school” ( funny how school, has become an insult) the financial system.
I live within my means. I have no debt. Its that simple.
Wants vs Needs
You should try it some time instead of blaming an entire generation for your crappy financial situation No one cares.
Grow up or grow a pair

#106 The American on 07.11.13 at 9:27 am

At #103: Spiltbongwater, wow, you are an amazingly ignorant fool for making such a comment. So, you believe the Obama administration is responsible for letting illegal immigrants remain in the U.S. as if his administration is responsible for the concentration of illegal immigrants in the United States? Racist much? You honestly think Mexicans are the only people responsible for making tacos, picking fruit, and tending to lawns in the U.S.? Or, is this just another one of the false depictions they teach you up there in Canada? That’s hilarious because just this week I went to a Taco truck, and two white women were making my tacos, a guy from the Philippines tends to our lawn, and a white husband and wife team pick the organic fruits they sell me at the farmers market. Un-f&*king-believable comment you made.

For the record, and you can research it on your own. Although President Obama supports setting a path to citizenship for many illegal immigrants, his administration deported a record 1.5 million of them in his first term (or 4.5% of the entire Canadian population, if it’s easier for you to swallow in these terms). No other administration has deported more illegal immigrants in our nation’s history. Do your research, and maybe you won’t sound so stupid next time…
http://www.npr.org/blogs/itsallpolitics/2012/12/24/167970002/obama-administration-deported-record-1-5-million-people

#107 fancy_pants on 07.11.13 at 9:40 am

DELETED

#108 The American on 07.11.13 at 9:42 am

At #10: The Profit Elijah, you’re not much of a profit as you’re wrong nearly 100% of the time. You may want to rethink your strategy a little… or a lot.

At #41: Picasso, in general the U.S. does pay higher wages for similar jobs as in Canada. Yet, we pay lower taxes and lower prices for goods and some services. Clearly expendible income is higher in the U.S. than in Canada. Tell me how again it’s supposed to end in Canada when houses there are double what they cost in the U.S.? Yeah, not too good. The U.S. pays very well for jobs that are working toward a better future, including biotech, IT, technology, infrastructure expansion, etc. The U.S. does not pay extremely well (but still pays competitively) for jobs that are stuck in the past, such as manufacturing roles.

At #55: Honey I’m Home, Picasso is right. Just because you may know of ONE person with a masters earning mid $40Ks/year, that does not paint a broad picture of the U.S. labor force and wages. You should tell your friend to move to another state where he/she can earn that right out of college as a teacher without a Master’s degree. Bottom line is this… The U.S. does pay better for the same job than does Canada.

#109 TnT on 07.11.13 at 9:46 am

#101 Morgan

Instead of mere venting, let’s have some evidence of ‘politicians handing over our money to the rich.’ And how, exactly, does that relate to young people flocking into arts degrees while plumbers drive Audis? — Garth

****

The evidence lies in the countless scandals we read about everyday. Municipal (Toronto computer scandal, Montreal mafia), to Provincial (Gas Plants) to Federal (Sponsorship Scandal) plus many we never find out.

It directly relates to young people as when these politicians hand our money to the rich then there is less for education (especially home economics and the arts which is lacking in our school that provides better child development).

Plumbers driving Audis, well anyone can get credit these days and because of this 10 year housing boom anyone with a heart beat that can hold a hammer and has some drive for success will be OK.

Obvious you never apprenticed to be a plumber or electrician, or spoke to someone who did. You have the whiff of entitlement. — Garth

#110 torontorocks on 07.11.13 at 9:53 am

I don’t know who’s buying houses for $1.9MM at Burnhamthorpe and Mississauga Road, but it would probably costs $20,000 a year to maintain on top of that. I’m not sure who can afford that. maybe some CEO making a few mill a year but they’d likely be in Oakville with the rest of the executive d-bags.

also, for the record, 1/3 of each tax dollar goes towards health care, education and infrastructure. 2/3’s goes towards public sector salaries and pensions. Shafiq Qadri is a practicing doctor and MP for Etobicoke North. He shows up at certain multicultural events wearing the same [email protected] shirt and tie, all the time, b/c he has to. how much does he make? is this not considerd double dipping into the public dole (doctor and MPP). plus he doesn’t even live in the ward. that’s where your goddamn tax dollars go. for buffoons in politics. their pensions (like Flaherty and his wife, two platinum plated pensions, for life). the OPSEU worms. TTC unions. Check the sunshine list and tally that mother up.

What an ill-informed comment. The Ontario budget is $124 billion, of which $75 billion is spent on health and education. Add in social services and environment, and this amounts to 79% of the total budget. Spending on all government services (includes wages, pensions) is 6%. Ever heard of Google, or will a little research shatter your conspiracy theory? — Garth

#111 TnT on 07.11.13 at 10:01 am

#107 CrowdedElevatorfartz

Slowly clawed my way up…. hahahaha – how dramatic, you started at the top and skipped your education when you had the chance. Lived within your means because back then you were never raised on credit. There were no endless mind numbing ads to buy buy buy on “free” credit. It’s a science to get people into debt by playing on their subconscious desires. Ever watch a kids TV program these days? wonder why kids crave sugar then adults crave credit? It’s a billion dollar industry to enslave people these days. And… when you crawled your way back up you only competed against your local neighbors. Try that climb now with debt and against the globe for a better job. The Baby Boomer sent all their high paying jobs over sea.

#112 George on 07.11.13 at 10:05 am

Vancouver may be getting its own bike-gate scandal. Mayor Robertson’s new home is believed to be at Point Grey Road near York Avenue, at the very end of the controversial, proposed bike path on Point Grey Road. This creates a potential conflict of interest for the mayor, as it looks like he was negotiating the sale during the public consultation process on the bike lane. From Village Whisperer:

“What no one told the public was that the dedicated bike path that would lead to the front door of the Mayor’s new house. A house which – at the time of the meetings – Robertson may have already bought (or was under negotiation to buy).”

http://whispersfromtheedgeoftherainforest.blogspot.ca/2013/07/housegate-when-did-mayor-buy-and-when.html

#113 County Living on 07.11.13 at 10:18 am

It drives me crazy when I’m at family gatherings and I hear the boomers complaining about how ‘kids these days won’t take crappy jobs’. Yet most of the boomers in the family, and many others I know, all got jobs, sometimes without high school diplomas, at the Big 3. These were high paying, great benefits, sometimes for life, jobs. Yet they think kids these days should be happy picking tomatoes for minimum wage.

Working on an assembly line for life. Yeah, that’s heaven. — Garth

#114 David Jensen on 07.11.13 at 10:19 am

You have the best pictures Garth.

I had to email today’s to a few friends, thanks.

But speaking of laughs, did you see the panicked back-pedal by Fed Officials, the ECB officials, and everyone else away from the concept of tight monetary policy? That cracks me up.

US interest rates peaked out a few weeks ago, and 10 year T-Bills back down to 2.5% today.

Interest rate panic provided a great buying opportunity for high quality preferreds (thanks to you for that some years ago) and other high dividend stocks like REITS, that were beaten up beyond all reasonability.

#115 Ret on 07.11.13 at 10:23 am

If Detroit defaults on the bondholders there will be serious ructions for US Municipal bonds. Debt is $25,000 per capita. (How did that happen?)

http://www.worldmag.com/2013/06/will_detroit_debt_sink_bonds

We only owe $17,600 per capita in Ontario so we are doing great! Check out your province on the last item of this post. Scroll the pictures.

http://www.huffingtonpost.ca/2012/10/16/provincial-debt-deficits-_n_1970344.html#slide=1637478

Forget the Curly, Larry and Moe political parties. I’m voting Rhino! Party on Canada.

#116 TnT on 07.11.13 at 10:25 am

Obvious you never apprenticed to be a plumber or electrician, or spoke to someone who did. You have the whiff of entitlement. — Garth

***

Actually I know about journeyman routes… I know they are only slightly better off than the academic Arts route because of the latest housing boom. I feel bad for them as they are being priced out by uncertified skilled foreign labor too. It’s tough for them in the best of times, wait until the housing starts dips a little further and will see about Arts degree vs. skilled labor over the next generation.

‘Uncertified skilled labour’ doing electrical and plumbing work? You’re making this up, aren’t you? — Garth

#117 middling on 07.11.13 at 10:32 am

# 101 Morgan

I have a friend who did tons of admin work in her youth. Since then has worked in IT. Recently laid-off and unemployed is having a hard time getting back into IT, since her skills are 5 years out-of-date. So she thought she could go back to admin work and found the same situation. She applies and there are 300 applicants who actually have degrees in admin work.

Garth–In today’s world you have to re-invent yourself every 5 years. Many of the young people I work with are aware of this. And maybe that is why there is an interest in a general arts degree. It is a broad-based education which should allow you to follow any number of paths, since no one knows what the future holds and how fast things change.

If everyone becomes a plumber, then there will be 300 plumbers for every opening.

#118 fancy_pants on 07.11.13 at 10:34 am

‘Uncertified skilled labour’ doing electrical and plumbing work? You’re making this up, aren’t you? — Garth

He isn’t, the only problem is when he flushes the loo, the lights go off.

#119 rosie "moving forward" on 07.11.13 at 10:42 am

For all you boomer haters. You think you got it bad. How about that wacky generation that spent themselves into oblivion, caused the great depression and world war 2. Their kids really got screwed. No wait, didn’t they start the industrial age, allow millions to emigrate to North America, and fight world war 1. What a load of shit today.

#120 Short Arms, Deep Pockets on 07.11.13 at 10:43 am

#68 Piccaso on 07.10.13 at 10:25 pm
#55 Honey I’m home on 07.10.13 at 9:47 pm
……………………………………………………………..

It is true, the LTE push is on in telecom with the ever growing data usage. Who owns a flip top cell phone and just talks on it now… nobody.
————–

I have a cheapo $40 nokia phone with a pay as you go plan – I pay $50 tops per year. Cell is strictly emergency, $3 per month home phone (VOIP), and I prefer interwebbing on my big screen home computer…

There are options to cut those crazy monthly fees. Check out FTA tv and XBMC (with Sickbeard) while you’re at it and you’ll never go back to cable/satellite tv.

#121 TnT on 07.11.13 at 10:46 am

‘Uncertified skilled labour’ doing electrical and plumbing work? You’re making this up, aren’t you? — Garth

****

Excuse my vocabulary – “non-certified” skilled labour e.g. Electricians and Plumbers who are for example, new comers from Poland but have not been certified here in Canada but still offer their services to many scrupulous contractors and home owners looking for discounts on renovations. This pisses a lot of certified Electricians and Plumbers who are getting priced out on bids.

#122 Mister Obvious on 07.11.13 at 10:54 am

#119 middling

“Garth–In today’s world you have to re-invent yourself every 5 years.”
—————————–

I worked in electrical engineering for 25 years. As I recall, things changed so fast you had to ‘reinvent yourself’ every week. That’s just the ongoing nature of daily work in an advanced society.

Today, there is a desperate need for Canadians to reinvent themselves financially but there’s not much happening on that front in spite of the courageous efforts of this pathetic blog.

#123 Doug in London on 07.11.13 at 11:07 am

Here we go again, with Baby Boomers and younger generation blaming each other for what’s wrong with today’s society. As everyone else has put in their 2 cents worth, I might as well put in mine.

It is true that younger people entering the work force now (yes, even the college and university educated) are having more trouble on average than we Boomers did, and often with student loans to pay off. No need to explain why, as other here have done so already.

However, there is a flip side to their difficulties. I have met many of them who, when I explain how I managed money efficiently (and still do) they don’t get it. They look down on someone like me as being inferior when I say I fix things like cars or appliances when they break down, or that I’ve bought used stuff at yard sales or second hand stores like Goodwill, or even fished good usable stuff out of the garbage. They also are, as Chickenlittle said in post #98, more worried about what everyone else thinks and are more into consumption for status than our generation. I overheard one guy, early to mid twenties, say that if in middle age you own an average person’s car like a Ford Focus that somehow you’ve failed in life. When they have such high expectations and think nothing of going into debt (and consequently have no savings) it’s easy to see how their money problems are partly their own fault. I always thought, and still do, that debt is a 4 letter word. Some of these younger people don’t get that idea.

#124 Mister Obvious on 07.11.13 at 11:07 am

#107 CrowdedElevatorfartz

Your history sounds eerily similar to mine, except that mine is shifted back in time by about a dozen years.

#125 Smoking Man on 07.11.13 at 11:14 am

All this talk about jobs..

JOBS SUCK, I REPEAT JOBS SUCK

Ownership with slaves is where it’s at… I can’t get threw to anyone here.

I know why, years and years of schooling, ak(slave making).

But no let’s make fun of the village idiot, I must be the one living in the matrix then.

#126 Justin on 07.11.13 at 11:17 am

I am so sick of the baby boomers trying to argue how hard they had it. Nothing the baby boomers went through compares to what young people today have to go through. Multiple university degrees, staggering student loan debt, and you can’t even get a minimum wage job! My mother was a single mother baby boomer who raised us on minimum wage. Guess what, her minimum wage job was FULL TIME hours! You’re lucky to get 30 hours a week these days. It really sucks when they only schedule you for a two hour shift (that wasn’t even allowed in my mother’s day–min. shift of 4 hours or something like that). So minimum wage in BC is $10.25. I go to my 2 hour-shift and I make $20.50. I pay a 3 zone bus fare to get there, at the full rate (not worth it to buy a bus pass for a part time job), which costs $5.50 each way so I am looking at $11 for my bus fare alone just to get to and from work. But a smart person realizes it’s actually cheaper to buy a day pass for $9.75 than two 3-zone bus fares. I spend more time on transit in the day then I do actually working. I make $20.50 minus $9.75 for my day transit pass that leaves $10.75 “profit” for my work. But I still have to pay for CPP (which will be bankrupt by the time I’m 67) and EI (which I will never use because employers don’t ever lay you off anymore, you just get fired for trumped up reasons). Why even work? You can make more money collecting cans and you don’t have to deal with customers (mainly entitled boomers who complain about the high prices as if you the part time minimum wage lacky had the executive power to set the prices). Then we have to deal with crazy real estate prices on top of that. Baby boomers cannot even begin to fathom a day in the life of a young person trying to make a go of it in this economy.

#127 OnPar on 07.11.13 at 11:24 am

Any Boomer who thinks my generation wants stuff “just handed to them” is delusional. What we want, all we want, is the same opportunity the Boomer’s had. The fact that his does not exist for us sits squarely on their shoulders. They squandered away opportunities for their own kids so that they could enjoy immediate economic benefits, all burdened by massive debt-load to future generations.
Boomers need to accept the fact that THEY are the most spoiled, selfish generation in history.
Here’s my take in standup comedy form:
http://www.youtube.com/watch?v=Th7mQv-jwo8

#128 Rational Optimist on 07.11.13 at 11:28 am

112 torontorocks on 07.11.13 at 9:53 am

I’ve heard about Dr. Qadri from folks in Etobicoke. He’s an MPP, though, not an MP. I agree that, if we are willing to admit that one can be a practicing doctor and an MP simultaneously, we are not expecting enough from our elected officials. MP is a difficult job, and the people doing it well are pulled in many different opposite directions every day. They don’t have much time for anything else.

You should organize a campaign to remove him come next election, either at the nomination meeting or on election day. You seem to feel strongly about it.

#129 Stickler on 07.11.13 at 11:43 am

Great post!

This points to more gov’t programs for low income seniors…paid for by their kids & grand kids

…further lowering the standard of living for gen x & y.

Younger, mobile folks should be getting the proper certificates to qualify for foreign work visas in the US, or Asia.

#130 crowdedelevatorfartz on 07.11.13 at 11:49 am

@#113 TnT

What does “TnT stand for ? ” Totally non Trainable”?

Uhhhhh , yeah . Crawling is how I would describe it.
My first full time job was for minimum wage which at the time was $2.85/hour for washing dishes……Did that for a year. Moved to Cowtown, worked minimum wage washing cars at the Airport, worked construction installing draintile, worked construction sandblasting ….. etc., etc., etc.
10 years later I was making the princely sum of $ 12.00/hr washing high rise windows in Vancouver. Couldn’t buy many houses in Vancouver in 1989 earning $12/hr
THEN I decided to make changes. Post secondary , courses after work, lived within my means. Stopped blaming everyone else for my financial stupidity.
And voila! 24 years and two market meltdowns later I’m seeing a light at the end of the work tunnel.
Interestingly enough I listened to the radio on the way into work this am. ( CKNW audio vault at aprox 6:45am if you care to listen.)
A job recruiter was complaining that 40% of all university graduates don’t have basic jobs skills. Reading, writing, conversation, etc. 40%………
NO ONE “owes” you a job Mr. University Grad.
Stop your whining and get out and earn it.

#131 MarcFromOttawa on 07.11.13 at 12:03 pm

Investment ideas for an ageing population:

-Eli Lily & CO (Cialis)
-Kimberly Clark (Depends)

That covers the basics.

#132 Holy Crap Where's The Tylenol on 07.11.13 at 12:05 pm

Back in the day when I graduated from High School you had multiple choices for your life.

1. Drop out from school and get a low paying job, perhaps pension, healthcare and slowly save money then purchase a home and never pay it off before you retired.
2. Get a factory job with good pay, pension, healthcare and slowly save money then purchase a home and pay it off before you retired.
3. Get a post secondary education get a job managing the factory with better pay, pension, healthcare and save money then purchase a home and pay it off in mid life before you retired.
4. Get a post secondary education with a degree running and eventually owning the factory with better pay, pension, healthcare and save money then purchase a home and pay it off quickly and enjoy life before you retired to your cottage up north. The whole time you drove a high-end car, took vacations, ate well, drank well, and had niceties of life.
5. Get a post secondary education with a degree in law, never actually work but get a job in the government or become a politician with insanely good pay, pension, healthcare and save money then purchase a home and pay it off quickly and enjoy life before you retired to your cottage up north. The whole time you drove a high-end car, took vacations, ate well, drank well, and had niceties of life.

Now those choices are limited, as dropouts cannot even find employment! Hell the Military won’t even take uneducated to train.

Those with High school education cannot find employment in factories as they are all in China, Mexico or some god forsaken tin pot nation. Relegated to temp firms, hired hands.

Those with post secondary education are working at McDonalds and the lucky ones at manufacturing facilities are on borrowed time. Some of the savvy ones will become entrepreneurial and succeed.

Those with post secondary education with a degree are working well below their means in positions that others should fill. The companies that higher these employees really benefit in the fact that they are acquiring highly skilled and educated staff with great credentials. Smart, bright and intellectually intelligent people and eventually these people will end up running these companies as they have the skill sets. The problem is however they are way behind in remuneration, and job position coming out of university. Some of the savvy ones will become entrepreneurial and succeed as well.

Those post secondary education with a degree in law, still never actually work but get a job in the government or become a politician and continue to make bad decisions for the rest of us. They are the “Pigs” just as in George Orwell’s Animal Farm! “Life will go on as it has always gone on—that is, badly.”[sic]

Well that’s my take on it. I have the degree and I used it to the max. I now own my on very successful hi-tech corporation and the technology I have created is not easily exportable to third world countries. BTW I do hire even High School dropouts, it is amazing what you can teach these kids through mentoring. Never to late to learn!

#133 tom on 07.11.13 at 12:08 pm

Hi Garth,

Sometime ago you had post regarding what to look for when buying a house. The list included knocking on the neighbours doors, driving around the neighbourhood etc. Can you point me to that post?

I am not buying of course but would like to be prepared for the day.

#134 ozy - Toronto is CHEAP actually on 07.11.13 at 12:17 pm

STOP WHINNIG about real-estate in this huge city with LOTS of CHEAP HOUSING options!

Hundreds of Condo and towns under 300000 in TORONTO.
Just look above and see the whole city. Just hit MLS web site, do a search before you open your mouth.

Toronto has EXPANDED to STEEELS and MORNINGSIDE, Scarborough, North York, and Etobicoke, like York, East York, are proudly under same mayor and city.

So stop whinning that you want to live in Forest Hill (then the rich will have to move where?) shut up and move on Warden & Ellesmere (nice area) or even cheaper on Kennedy Road & Steels, Morningside south of 401, or in the west south of Rexdale. What’s the problem?

THIS CHEAP AFFORDABLE CITY WITH GREAT TRANSPORTATION LINKS It’s all yours to conquer!!!!

And don’t forget Agincourt, the nice destination (forced I think) for immigrants decades ago, now a trendy Walmart throning there.

Stop whinning and waste time online. Your Scarborough barbeque neighbors are all waiting for you!!!!!!!!!

omg, lol

need some replies, hadn’t have so much fun in years!!!

#135 TEMPLE on 07.11.13 at 12:20 pm

#86 Mr. Monday Night on 07.11.13 at 12:41 am

Great comment!

As a renter, one has the option to move if the rent gets too high

This is an important point. Also, you hit the nail on the head regarding collusion or price fixing among landlords. The price to rent ratio in my town is currently about 20, while vacancy rates are approaching 10%. Looks pretty unlikely that rents will be going up in any significant way here. In the meantime, house prices drop and listings sit.

TEMPLE

#136 Macrath on 07.11.13 at 12:26 pm

Residential construction accounts for about 25% of the action in the trades. Most of the Audi money is in the commercial, industrial and infrastructure sectors.

#137 Not bitter on 07.11.13 at 12:36 pm

The situation of Gen Y can be partly left at the feet of the boomers.
At least in Canada, the boomers have owned politics for decades. They made up a huge tax base with few dependants (unemployed parents and children) and a huge middle class. The pushed hard for high union wages, high paying public jobs, expensive and ill conceived social programs and ran constant deficits. And now, making up the biggest voting block, will not retire (cause they squandered their middle class earnings on phones, tvs, and dining out), will not reduce their pensions, and will use their political power to increase medical care for geriatrics (not for their parents but, just in time for them to enjoy.) Then they told their kids to borrow vast amounts of money for an education and to ‘do what you want in life’, hence the generation of pop star wannabes, interior designers, and librarians.
So, we have a generation that made more money than any other in history, had the fewest dependants of any other generation in history, didn’t pay enough tax to support all the programs they demanded, didn’t save any money for retirement and will now pull a grasshopper in winter and ask the ants to pay for their retirement (with jobs they won’t give up.)
In case anyone was wondering, that is why they are called generation greed…
That at least explains the boomers I know… They may have worked hard but, they spent stupid! Teach yourself and your kids to make money tax free and from various sources cause this generation is not done collecting and they are just starting to get to the age where the big bills start coming in. They are broke (and in debt) and in charge of the Gov credit card.

#138 Mister Obvious on 07.11.13 at 12:38 pm

#129 OnPar

That’s the second time you’ve posted that link to your comedy routine on YouTube. The funniest point occurs at 1:04 where you suggest boomers are “scared of the internet”.

How about “they invented the internet”? And the best you young pups can do with that incredible legacy is fill it with self indulgent, retro-culture-eating, narcissistic pap. You must be so proud.

#139 TnT on 07.11.13 at 12:46 pm

#132 crowdedelevatorfartz
What does “TnT stand for ? ” Totally non Trainable”? –
Wow.. you cut me to the core with your wit….

So you admit that you wasted your generational opportunity being a baby boomer by forgoing the academic route and working general jobs at a time when it was smarter and cheaper to get an education. “THEN I (you) decided to make changes” and “Stopped blaming everyone else for my (your) financial stupidity”. I am glad you are happy with your efforts and how you played the hand dealt to you.

A job recruiter was complaining that 40% of all university graduates don’t have basic jobs skills. Reading, writing, conversation, etc. 40% (Yeah, these kids are raised by Baby Boomers…)

NO ONE “owes” you a job Mr. University Grad. (No one can get a job, Baby Boomers sent the jobs overseas and I’m no University Grad… I’m a Gen X’er paying your generational tab)…

Stop your whining and get out and earn it. – Done.. and done.. and still doing it despite the extra burdens of the “can” being kicked down the road by your generation.

Queue sad violin music now and repeat your life in this generation. Forgo the academics and look for a job now being 18 with High School education and have been raised by a generation of self-entitled baby boomer whiners. Work general labor jobs; compete with new comers on wages. Move out on your own, pay rent, own a car, start a family. Then decide at some point to go back to school and see where you stand against a Baby Boomer. Sure many people can “do it” but not without being bitter by all the taxes you have to pay on top of trying to get ahead.

#140 Dupcheck on 07.11.13 at 12:57 pm

What happens when the middle class this buffer class is gone? War of classes. Owners vs. Slaves all over again. Think a bit about this greedy 1%-ters.

Why are successful people ‘greedy’? They donate a larger proportion of their net worth than others, and often create the companies that employ many. What is the basis for this label? — Garth

#141 Dupcheck on 07.11.13 at 1:02 pm

#136 ozy

You call cheap 300 sqf barakas with a toilet in the middle of the room selling for 349,000?

You are pathetic get a real job…

#142 Old Man on 07.11.13 at 1:03 pm

The reason so many youth cannot find employment or careers today is because they are not identifying a future demand for an occupation. They educate themselves or go to trade schools that our traditional, but not realistic in a changing world going forward. The end result is too many cows are eating in the same pasture, and the demand is in another farm field.

#143 Ahead of the Curve on 07.11.13 at 1:14 pm

Great post,

Fact is all generations love to complain on how the others had it easier. For me, this type of discourse is purely a waste of time. How is complaining about your circumstances going to improve them?

Do younger generations have it harder today? The evidence overwhelmingly supports this premise, but the effort should be on how to improve, not pointing fingers.

There are a significant number of young people doing extremely well, with high pay and fulfilling jobs which are much better off than older generations at the same age. Now, if you expect to get an arts degree and be entitled to job because you can read, you are in for a rude awakening.

Not all is your fault, because younger generations often followed the model that worked for their parents. But if you are reading this blog, then accept responsibility for where you are, and if you don’t like where you are, you can change. You are not a TREE.

Good luck!!

#144 dradak1 on 07.11.13 at 1:15 pm

” #75 Devore on 07.10.13 at 11:03 pm
… Plenty of work for people with the right skills willing/able to relocate. Most un- or underemployed are neither of those.”

Completely fault statement – over 2 years out of work – experienced IT with BA willing to relocate.

#145 frank le skank on 07.11.13 at 1:21 pm

Public vs private workers
Boomers vs Gen X,Y,Z
immigrants vs Domestics
Renters vs owners

All illusions that distract us from things that matter.

#146 Sebee on 07.11.13 at 1:34 pm

Am I reading this correctly? Nearly 1/2 of those with 1M+ in liquid wealth don’t care to live in our sprawling traffic infected poluted major cities with overpriced real estate?

Interesting.

#147 Old Man on 07.11.13 at 1:38 pm

Here is a great idea for young or old to make some part-time money if you have basic training. Hit a website the other day using today’s technology for a home service, and hate going to a barbershop sitting around or driving there and back. This person does men’s and women’s hair with the full agenda.

Well districts are booked, and mine is coming up so will phone tonight for a booking, as need a basic haircut for $23.00, and all must be paid in cash. I say this is so cool, as this person is pulling down more than $1,500 a week one way or another using a simple website.

Someone looked at a growing demand and has created a nice little business with very little overhead to compete with fixed store businesses, and is laughing all the way to the bank. This all could be done with basic training; a student; a housewife; or whoever? I will try this service out, as doubt they are certified, but say they have experience. Yes will throw in a tip, and am hoping they are charging the legal tax for a service rendered.

#148 Mark on 07.11.13 at 1:39 pm

“Urgent… Nokia, Ericsson, Alcatel, Lucent, ZTE, Huawei, engineers needed !!!”

Chinese and Indian engineers. Canadian (Electrical/Computer) Engineers don’t even the proverbial “time of day” from these companies. There’s a whole decade of engineering grads in this sector that are either unemployed or underemployed, with even very basic entry-level jobs in the telecoms receiving hundreds of resumes and specialist positions receiving 50+ resumes.

Its been a real disaster. There ought to be a saying, if engineers can’t be universally/fully employed, the economy is running at far less than its potential capacity.

#149 sciencemonkey on 07.11.13 at 1:44 pm

Wow, I’m famous, my comment made it to a blog post!

I find #142 Dupcheck’s complaint, and Garth’s response interesting. It’s obvious that real wealth and jobs are created by small and large scale entrepreneurs, and they deserve to enjoy their success.

The question has more to do with whether the slaves who create wealth through their work deserve a piece of the pie. Or should they be exploited like Smoking Man advises? Of course we don’t have any formal system for this, just the supply and demand of labour, but recent developments like labour arbitrage have worsened the slaves’ prospects.

Meh, it’s not like a middle class has been around forever. In fact I remember reading an argument about how the post-WW2 emergence of a middle class was a concession by the machine to prevent communism from taking root in North America. However, once a few generations had passed and the threat of communism had passed, it would be possible to move society back to a have and have not basis.

#150 Nemesis on 07.11.13 at 1:51 pm

…”…let’s have some evidence of ‘politicians handing over our money to the rich’.” – HonGT

Well then, AuldPol – one might begin here:

http://www.theglobeandmail.com/report-on-business/economy/the-hidden-price-of-public-private-partnerships/article4611798/

Be that as it may, however – the real trouble begins when the ‘funds flow’ is reversed, so to speak…

Here is but one example (don’t you just love GoldenOldies?):

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

It hardly bears mentioning that these ‘ParliamentaryPeccadilloes’ are highly toxic to the body politic… and worse, socially corrosive.

For example, yesterday in British Columbia’s WestKelowna provincial by-election 63% of eligible voters effectively opted for ‘none of the above’.

Now why would they do that, I wonder?

#151 Canadian Watchdog on 07.11.13 at 1:59 pm

Why are successful people ‘greedy’?

Why are corporations sitting on billions of dead cash and not able to deploy it for profit? Or invest it in skilled workers that they keep saying there is a shortage of? Answer: because they can't make profit without state corporate welfare, tax scheme benefits and central bailouts — all backed by taxpayers. 

Is this your idea of success? That's looting, not success.

Profits are good. You’re losing it. — Garth

#152 Holy Crap Where's The Tylenol on 07.11.13 at 2:08 pm

#142 Dupcheck on 07.11.13 at 12:57 pm
What happens when the middle class this buffer class is gone? War of classes. Owners vs. Slaves all over again. Think a bit about this greedy 1%-ters.

Why are successful people ‘greedy’? They donate a larger proportion of their net worth than others, and often create the companies that employ many. What is the basis for this label? — Garth

I have to agree here with Garth, I am successful! I am an Owner and my employees are not Slaves “as quite a few bloggers refer to them.” Without my employees my corporation would not be where it is today. I come up with the initial ideas and technological know-how but it is my employees that carry out the execution of the designs and in turn enhance the product. I have no exculpatory provisions built into my work contracts with employees. The bright, intelligent hard workers get rewarded accordingly. Some of my staff have gone on to found their own companies after tenure with me. I always say to them if your not happy here just let me know and we will work together to see if you fit better in another division or until you find employment elsewhere and we hire a replacement in-which I expect them to train. I do not consider myself “greedy” In fact as I mentioned earlier my technology is not easily moved offshore, however I could do it and instantly we would loose good paying positions that allow many families to be gainfully employed and to pursue their personal aspirations.
So for all of you whom derogatorily call employees slaves please note I take offense at your lack luster vocabulary on behalf of the hard working honest people out there who aspire to become someone better.

#153 neo on 07.11.13 at 2:27 pm

Why are successful people ‘greedy’? They donate a larger proportion of their net worth than others, and often create the companies that employ many. What is the basis for this label? — Garth

http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2013/07/20130710_santelli.jpg

You were saying?

Garth, there is a fine line between a 1st world country and a 3rd world one. A third world country doesn’t have a large middle class. Every country was very rich and very poor people.

You chart bears no relation to the subject at hand. Without profits there are not jobs. — Garth

#154 TurnerNation on 07.11.13 at 2:31 pm

Serious buy program lifted TSX while everyone was eating lunch. Outta the way this computer-summer rally is legit.
Even Watchdog’s boffo Gofa model has hit paydirt.

#155 TakingResponsibility on 07.11.13 at 2:37 pm

RE: #95 Buy? Curious? on 07.11.13 at 2:41 am
And #129 OnPar on 07.11.13 at 11:24 am

Love those links! That was Freaking Good Comedy!!!
Good Comedians are the best truth tellers ever!
LMAO…..Thanks for the links!

#156 Rational Optimist on 07.11.13 at 2:37 pm

# 128 Justin on 07.11.13 at 11:17 am

Step 1) Understand that you have the ability to influence much of what happens to you, and all of how you respond to it. See post #132. Stop complaining.

Step 2) Call College of the Rockies or Selkirk College and other institutes like that. Ask them about financial assistance and the like- they will have some for you, probably very generous. Right now, making minimum wage and working such few hours, you are not paying tax. You are getting credits for tax you don’t pay, and your transit is subsidized. You may as well get the taxpayers to subsidize an education for you. It’s useful for everyone.

Step 3) Do a bit of reading, and figure out what skills are in demand- register for a trade program, NOT communications or early childhood education or anything like that.

Step 4) GET OUT OF VANCOUVER.

#157 Julie on 07.11.13 at 2:39 pm

What an ill-informed comment. The Ontario budget is $124 billion, of which $75 billion is spent on health and education. Add in social services and environment, and this amounts to 79% of the total budget. Spending on all government services (includes wages, pensions) is 6%. Ever heard of Google, or will a little research shatter your conspiracy theory? — Garth
—————————————

I think its you who is ill-imformed Garth. Out of that 75 million you have VERY PISS POOR MANAGED people that WASTE money like no tomorrow. Everyone knows there are more “Health Managers pushing paper” than there are health care workers. WE ALL have heard those stories from insiders in the govt. That 75 Million should be allot less.

I give up. Too many people have their ears welded shut. — Garth

#158 zeeman1 on 07.11.13 at 2:39 pm

Garth, much as I appreciate your views and service running this blog, you must now acknowledge that Burnake’s indefinite continuation of QE (announced today) means the economy isn’t recovering, and is at best on wobbly legs.

If things are looking so good why not scale back or turn it off altogether?

The comment was yesterday, not today. It was not an announcement. And QE will end. — Garth

#159 Mike T on 07.11.13 at 2:47 pm

I just wanted to take a swing at the idea that politicians take ‘our’ (taxpayer) money and hand it over to the rich (corporations).

http://www.cbc.ca/news/offbeat/story/2011/11/18/pizza-school.html

This is a story about lawyers representing large frozen and processed food companies arguing that pizza is a vegetable, or equivalent. The reason is the US introduced (gastly) minimum standards when it comes to the food served at schools during lunch. Seems every meal has to have a minimum vegetable serving size. Clearly pizza is NOT A VEGETABLE DUH, and neither is 2 tablespoons of tomato paste.

But the corporations would lose out on untold fortunes if frozen pizza was removed from school lunch programs, so they hire lawyers and yada yada….pizza is a vegetable.

Yes this is the US, no Canada is not the same…..but still. Clearly the system favours ‘not us’.

#160 Not bitter on 07.11.13 at 2:48 pm

So, I blame a bit of the trouble on the Boomers, with good reason I think. Public debt is causing many of the problems and they are the ones who authorized and spent it.
Now lets talk about how the kids have it good today. First, very few boomers where allowed to stay at home in their twenties and thirties. The ones I know got kicked out in their teens (not moved out with good jobs, kicked out with no jobs.) That is great for saving money in your youth. The opportunities are everywhere and easier then ever to take advantage of. Make a website. I know a guy who’s son was a millionaire before he was twenty cause he made a website that listed the lyrics of songs and sold ad space! Another guy bought and sold used goods online (all tax free) but, never actually touched the goods!Just had them shipped around from vendor to buyer! (possible because of the internet and excellent and cheap shipping, also a new development) Add to that the ease and low cost of investing online and cheap/available credit.
So, the y’s etc have access to the cheapest credit known to man (at a young age), excellent saving opportunities, abundant entreprenuerial opportunities, excellent safety nets, easy investing options, ultra cheap technology and consumer goods and a wealth of information that make university libraries look like a book store in a coffe shop (most of it free) and access to very cheap student loans (like or not kids, Government Student Loans are a great deal in this country.)
So no, you don’t get to be a drone on a production line making a good wage, but, you do get a easy life if you choose poverty and an exciting life full of opportunity if you choose. Max that credit card buying something you can get cheap and sell it to people who will pay a premium (it is very easy to get trinkets shipped from Asia and there are an abundance of Boomers willing to pay stupid high prices for the stuff.)
Instead, the Y’s I know spend at least 10000 hours infront of a game console before they were 20 and would rather stay with mom then live in poverty. Myself, I borrowed, got a worthwhile degree, an underpaid/overqualified job, saved, invested, lived cheap (and took the ridicule), demanded raises, took risks. My friends: played games, no risks, no education, asked mom for beer money, refused to live in poverty and spent their pay cheques on ‘I earned it/rewarding myself’ steaks dinners and car payments.

#161 Canadian Watchdog on 07.11.13 at 2:52 pm

Without profits there are not jobs. — Garth

LOL… Look at the chart and say that again.

Gladly. Without profits there are not jobs. — Garth

#162 zeeman1 on 07.11.13 at 2:54 pm

#81 Valerie Keefe.

That was absolutely the dumbest post of the day.

Looks like that education you bragged about didn’t make you smart.

After reading through the dribble you posted I gather your solution for your lot in life would be government wage/price controls?

“beautiful welfare state”?

Ugh.

#163 OnPar on 07.11.13 at 3:14 pm

#140 Mister Obvious
Notice how people laugh and applaud – that happens when you connect with the truth. And yes, let’s get into an argument about the origins of the Internet. I’m sure you won’t be in over your head. When its original protocols were released to the public, the technology was embraced by young culture which developed what we now know as the Internet. Of course, the Boomers did find a way to manipulate the economy with the tech-bubble though (if that’s what you mean). Get your head out of your old ass and take some responsibility. By the way, we are far too educated and pissed off to win arguments against. I look forward to when people like you are eating cat food and begging us to bail you out. If you’re lucky, maybe we’ll give you a bowl of milk and a flea collar too, pussycat.

#164 Old Man on 07.11.13 at 3:18 pm

The younger generation are computer smart, but fail to put up a website selling something with all the bells and whistles for payment and delivery details to fill an order, and forget the Ebay gig, as that is all over. Now, am talking about an array of products, so look around as to what others are doing, and start to make some deals at a wholesale level to sell retail, or on a consignment basis for a commission.

See what is selling with a demand, and look around in your immediate area for goods which could be a farming enterprise; a small manufacturer; a tiny food processing operation; or someone making unique items without a market. You make the deals to make them money at a wholesale level, and sell on the net with a big mark up for retail. How about making a deal in the radio market as an agent to sell in Canada with stuff that you cannot buy here?

The sky is the limit for a part-time business being run out of your home with a website on the net, so stop all the doom and gloom, and get cracking using smarts, technology, and a website that is appropriate to sell into the retail market in Canada and USA.

#165 Smoking Man on 07.11.13 at 3:18 pm

#153 Holy Crap Where’s The Tylenol on 07.11.13 at 2:08 pm

So for all of you whom derogatorily call employees slaves please note I take offense at your lack luster vocabulary on behalf of the hard working honest people out there who aspire to become someone better.

So Richard Branson of you

Nice, see in real life I say the same thing to dogs. I play the same actor, but inside my head, logic rules.

Why would anyone slave like dogs for me, when it easier to set up shop. I have no real respect for them…

I m not sorry I offended you cause you’re lying… And if your not and that naive, a smoking man in you origination will steel your business..

#166 johnnny on 07.11.13 at 3:25 pm

#149-old man: that is a great idea.
A while back you also,said something about taking videos of a certain neighbourhood where people were thinking of buying ,to show them the good,the bad,and the ugly.Now THAT would be an interesting web-site.
Good luck with the local representatives though,if they got a bad review.

#167 NorthOf49 on 07.11.13 at 3:26 pm

I wish we could get back to discussing real estate. For instance, does anyone know why the Realtors Association for Hamilton-Burlington has not posted their monthly June figures yet on either their website:

http://www.rahb.ca/

or their Facebook page:

http://www.facebook.com/RAHBNews

I’m wondering if its because their own stats show a May ’13 to June ’13 monthly average sales price decline (-2.6%). This is the first I’ve seen that average sales price has actually declined in the Ham-Burl market with shrinking inventory. Did we actually see a May peak as Garth foretold a few posts ago?

See here for figures. There is currently no link to this report from the RAHB site or the Facebook page.

http://www.rahb.ca/press/2013/130708statsreleaseJune.pdf

There’s no mention of a declining monthly average sales price in the The Spectator article, only the average yearly increase.

http://www.thespec.com/news-story/3883487-june-real-estate-sales-up-over-last-year/

#168 Onthesidelines on 07.11.13 at 3:37 pm

“Profits are good. You’re losing it. — Garth”

Good for whom? Same old, tired job creators argument I suppose, except where’s the jobs?

Greed rules, pure and simple. That is the achiles heel of an economic system driven by profit over and above all else.

#169 Donald Trump on 07.11.13 at 3:40 pm

The comment was yesterday, not today. It was not an announcement. And QE will end. — Garth

======================================

And the sooner the better good riddance to the monarchy !

#170 happy renter on 07.11.13 at 3:49 pm

Qe forever.Bernake knows if he takes backs 85 billion to pump the market it will collapse.

Of course it won’t. — Garth

#171 crowdedelevatorfartz on 07.11.13 at 3:53 pm

@#161 Not Bitter
Well said.
Its a shame that TnT cant see past his hatred of all things Boomer to realize that everyone ( Boomers included) only have their “easy credit” and lack of fiscal discipline to blame their current financial woes on.
Look in the mirror TnT . The problems start with the person you’re staring at…….. And whining about everyone else wont fix the problem.

#172 neo on 07.11.13 at 4:00 pm

You chart bears no relation to the subject at hand. Without profits there are not jobs. — Garth

Actually, the chart says it all and is 100% related to your blog subject today. Even with RECORD ALL TIME profits the chart is telling you jobs as a percentage of the population are going in the opposite direction. The rich aren’t being eaten, the middle class is.

#173 em on 07.11.13 at 4:19 pm

garth when are you coming out with another book?

#174 crowdedelevatorfartz on 07.11.13 at 4:32 pm

@#141 TnT ( Try not Talking)
In the immortal words of the Ultimate Boomer ….Frank Zappa, ” Why does it hurt when I pee?”

#175 Nemesis on 07.11.13 at 4:50 pm

“Without profits there are not jobs.” — HonGarth

Well, strictly speaking… there are plenty of recent examples of ‘no profits but lots of jobs’.

http://en.wikipedia.org/wiki/Dot-com_bubble#Free_spending

I would, of course, be the first to concede that they ultimately proved ephemeral, to say the least.

#176 Basil Fawlty on 07.11.13 at 4:56 pm

“Qe forever.Bernake knows if he takes backs 85 billion to pump the market it will collapse.

Of course it won’t. — Garth”

Okay, what will happen if QE ends? Interest rates will rise and the stock market will fall. We know that from a couple weeks ago. Jim Sinclair suggests it will end when the US dollar hits .70 on the USDX.

#177 julie on 07.11.13 at 4:59 pm

Smoking Man, (1) what is your analysis on the impact laundered money has on the real estate in Canada? (2) what connections does an individual need to get a long term contract with the government?

(2) Yes because using tax dollars to get a golden salary which makes taxes go up for private workers really makes the country richer……..

Your Pin is Tripe……

#178 JimH on 07.11.13 at 5:01 pm

95F here in the shade and the Missouri humidity is incredible. Knocking back a Samuel Adams Summer Ale with the hay all baled and the boys stacking it. Feeling my age at last!

The cross-generational sparring tells me some of you folks don’t get out enough! At every stage and in every occupation in my life (on both sides of the 49th), I’ve rubbed shoulders with men and women older and younger than myself. Any “generation gap” was superficial and inconsequential.

Some of the people whose lives melded with mine were genuine horses’ asses. Some were simply out of their depth and drifting. The overwhelming majority were people of sound character with a strong sense of fair play and a desire to contribute everything their talents and abilities would produce for the benefit of their loved ones and the common good of society.

Age and generation had nothing whatsoever to do with it.

The young’uns of today face lots of problems that I’m very thankful I don’t have to struggle with. I and the other wrinklies of my age group have our own issues to deal with. It has always been so.

Just remember; if you’re breathing, you’re one hell of a lot better off than your great-great grandad!

Who said life was supposed to be easy?

#179 Whinepegger on 07.11.13 at 5:03 pm

Love your blog, Garth. As to an example of governments giving cash to the rich you need look no farther than David Thompson and the Winnipeg Jets. Not only is our NDP government giving True North (David Thompson’s co. that owns the Jets) a license to print money via one-armed bandits (read slot-machine revenues), we the people are subsidizing True North to the tune of $8.75 per ticket per game to stay in Winnipeg. And that’s not including some of the steepest ticket prices in the league. There’s a lot more but I won’t bore you with the details. You get the drift.

The NDP does their yada-yada about the economic benefits of handing money directly to the richest man in Canada but a look at Manitoba’s bottom line says otherwise. Not to mention the death of other entertainment industries, mostly the little local guys, in Manitoba that are being strangled as a result of lower funding and fewer entertainment dollars coming their way.

#180 craig on 07.11.13 at 5:05 pm

The Dow and S&P finished at record highs as investors hoped the Federal Reserve will continue stimulus.

The Dow added about 170 points, and the S&P was up 1.4%.

Follow complete coverage of breaking news on CNN TV

#181 crowdedelevatorfartz on 07.11.13 at 5:12 pm

More TnT acronyms.

Totally nonsensical Tirades
Trust no Taxpayers
Talking near Tears
Talking not Trustful
Theme not Transparent
Treat none Truthfully
Twelve not Thirty
Tirade nears Termination

There are TONS more but this is a “family “G” rated blog and I don’t want the hammer coming down from the Garth on high……..

#182 TnT on 07.11.13 at 5:15 pm

#172 crowdedelevatorfartz
Look in the mirror TnT . The problems start with the person you’re staring at…….. And whining about everyone else wont fix the problem.

****

How cliché… you are getting comical…

First I look at my pay cheque and see I am being taxed at 50 %

Then I look at my bonus cheque and there goes 51 %
I look at my receipts for everything I buy and I see 13 % vaporized

Then I look at my income tax return after I add in my T5, well there goes any 50 %

I don’t even see the hidden taxes in Gas and various other transactions and hidden costs

Does this not bother you?

Stop taking this personally for a minute and think about your generation. Be honest with yourself and ask if your generation are takers or givers?

As the voting block in our country why would you allow this to continue?

Do you even care about the world you are leaving behind?

Nobody in Canada is taxed at 50%. If you earn $300,000 the average tax rate is 39.5% and your marginal rate is 46.4%. — Garth

#183 Old Man on 07.11.13 at 5:16 pm

I was just surfing the liquidation sales in Toronto and so many are going down, as one can furnish a home for peanuts or the poor guy with the huge men’s retail store with highend stock selling soon for 90% off to hoop a new wardrobe. There are bargains everywhere, and there is a huge warehouse in St. Catherines to buy certain stock to flog on the net too.

#184 Smoking Man on 07.11.13 at 5:20 pm

#178 julie on 07.11.13 at 4:59 pm
Your pin is tripe?

Washed loot, no idea, everything I don’t is legit, way harder to do crook bus.. Can’t sue, got to shoot people to get paid.. Far to much work. Easier to have the schooled give you almost free labour.

Govt contracts very easy

Get a partner, you go with the libs, partner with pc’s

Donate 1000 bucks to each party. Help campaign next election, shmozz the candidate.

Whom ever wins next election, call in your mark, get the low down on the tender contracts. Bid. If you can’t compete approach a rival and play middle man.
That shits easy…

#185 lee on 07.11.13 at 5:40 pm

Let me try again.

For those of you who believe the stock market is an unreliable store of wealth, remember these facts:

1. In 1929, pensions did not exist.
2. In 1929, RRSPs and ETFs and Mutual Funds did not exist (I don’t think they did).
3. In 1929, the majority of investors in the stock market were people, not institutional investors and pensions.
4. In 1929, the government was not dependant in the western world on revenues being pumped out of pensions plans, RRSPs, 401Ks, etc. each year at tax filing time.

Everyone is not going to pull out of the stock market on mass because today, everyone in the stock market is largely made up of pensions funds, long-term RRSP investors, trust companies preserving the wealth of the elderly and the estates of deceased, charities, and the like. I do not know the actual percentage, but all of the above make up the vast majority of investment in the market. In fact, I would not be surprised if pension funds and institutional investors make up more than half.

Everyone is not going to run out of the market long term.

As long as the companies issuing the stock keep making stuff we need and want, the stock market will continue to store value long term and grow.

Personally, we should all be wishing for a hand full of 20% pull backs in the market over our investing life.

#186 Captain Critical on 07.11.13 at 5:41 pm

#39 Smoking Man – In real life I’m the most interesting person you will ever meet.

Impossible! The most interesting man in the world is the Dos Equis guy!

http://www.youtube.com/watch?v=U18VkI0uDxE

#187 brainsail on 07.11.13 at 5:53 pm

“WASHINGTON (Reuters) – House Republicans on Thursday unveiled draft legislation that would wind down housing finance companies Fannie Mae and Freddie Mac over a five-year period and sharply reduce the government’s role in the mortgage market.”

http://news.yahoo.com/house-republicans-eye-closing-fannie-mae-freddie-mac-144636881.html

#188 Craig on 07.11.13 at 6:05 pm

Nobody in Canada is taxed at 50%. — Garth

===================================

#183 TnT

First I look at my pay cheque and see I am being taxed at 50 %

====================================

Let me help you;

Your paycheque of $75 a week minus $25 = $50 not 50%

Now go have a nap, Mom will be home soon

#189 TnT on 07.11.13 at 6:06 pm

#182 crowdedelevatorfartz

Your replies speak volumes of your nom de plume choice…

Thanks for representing your generation… “Baby” Boomer…

#190 TnT on 07.11.13 at 6:07 pm

Nobody in Canada is taxed at 50%. If you earn $300,000 the average tax rate is 39.5% and your marginal rate is 46.4%. — Garth

***

My bad… 50 % is typo – should have read 30 % (but actually it’s 28.8 %)

#191 crowdedelevatorfartz on 07.11.13 at 6:13 pm

@#183 TnT

Your comment….”Be honest with yourself and ask if your generation are takers or givers?

As the voting block in our country why would you allow this to continue?

Do you even care about the world you are leaving behind?”

Geez, Didnt know little old me had such an effect on the country……..

As for “my generation” Would that be the generation that voted in the govts responsible for equal rights, desegregation, nuclear disarmament, recycling, Canada pension, Universal medicare, etc etc etc……….

Global Warming, Climate change, bankrupt pension plans . All were not on the radar 20 – 30 years ago and if they were evident. No one gave a rats ass about it.
They still don’t . Boomers do vote, Gen X’ and Y ‘ers don’t….. Who’s fault is that? Mine? I recycle.
Cry me a river because the govt in power that your generation cant be bothered to get out and vote out of office wont do what YOU want. My heart pumps purple pee for you
Before you blame Boomers for everything
Take a look at your Gen X and Gen Y conspicuous consumers. The tv doesn’t work , to hell with repairing it….buy a bigger one! The local WalMart has Brazilian Beef on sale (cheaper than it costs to grow Alberta beef) don’t stand in the way of “bargain hunters” you’ll be crushed.
Obese Gen X adults and their equally fat children that will eventually become diabetic burdens to the healthcare system. Cant blame that on me either.
I exercise. So thank me for not tying up a hospital bed for a sick Gen x’er.

Fiscal and environmental ticking time bombs that todays average voter/ consumer and politician are finally NOW waking up to are todays “buzzword”
Wait until the third world gives birth to another Billion people in the next 7 years, and then another Billion 5 years after that. I did my part on the worlds overpopulation I don’t have any kids. No need to thank me for all I have done.
I’ll sleep very well tonight.

#192 jess on 07.11.13 at 6:14 pm

without a list i don’t exist or with a list i don’t exist?

(Reuters) – France tax evasion, according to a parliamentary report on a probe into HSBC (HSBA.L) that revealed $5 billion of undeclared assets in thousands of Swiss bank accounts.

The report, published on Wednesday, looked at why it took French authorities more than four years to begin an investigation after a former HSBC employee gave them a list of people who held money at the global bank’s Swiss arm.

http://uk.reuters.com/article/2013/07/10/uk-france-tax-hsbc-idUKBRE9690FY20130710

==========
what middle class
Since 1992, Bill Moyers has been following the story of these two middle-class families — one black, one white — as they battle to keep from sliding into poverty. He first met the Stanleys and Neumanns when they were featured in his 1990 documentary Minimum Wages: The New Economy. The families were revisited in 1995 for Living on the Edge, and again in 2000 for Surviving the Good Times.

Bill Moyers revisited his reports on the Stanleys and Neumanns and talked about issues raised with authors Barbara Miner and Barbara Garson on the July 5 episode of Moyers & Company, “Surviving the New American Economy.”

http://billmoyers.com/2013/07/10/two-american-families/

#193 Craig on 07.11.13 at 6:36 pm

tnt – My bad… 50 % is typo – should have read 30 % (but actually it’s 28.8 %)

I guess your bonus cheque taxed at 51% was another typo or do you simple not know what you’re talking about and in need of some attention…I’m bettin the latter.

“Then I look at my bonus cheque and there goes 51 %”

#194 Evangeline on 07.11.13 at 6:37 pm

#186
“Everyone is not going to pull out of the stock market on mass because today…”

not to play spelling poiice, but I think you might mean the French expression “en masse”

#195 TnT on 07.11.13 at 6:39 pm

#188 crowdedelevatorfartz

Learn your history – everything you listed is a problem your generation created and never fixed.

Your generation are bad stewards of our planet and you refuse to admit it, that’s why it will not be your generation that fixes it.

#196 Stupesing in Cabbagetown on 07.11.13 at 7:04 pm

Someone attempted a “Garth” with this graphic, but I’m not sure it worked: Business Week.

Too graphic for me. — Garth

#197 intuition on 07.11.13 at 7:09 pm

#166 Smoking Man on 07.11.13 at 3:18 pm
#153 Holy Crap Where’s The Tylenol on 07.11.13 at 2:08 pm

So for all of you whom derogatorily call employees slaves please note I take offense at your lack luster vocabulary on behalf of the hard working honest people out there who aspire to become someone better.

So Richard Branson of you

Nice, see in real life I say the same thing to dogs. I play the same actor, but inside my head, logic rules.

Why would anyone slave like dogs for me, when it easier to set up shop. I have no real respect for them…

I m not sorry I offended you cause you’re lying… And if your not and that naive, a smoking man in you origination will steel your business..
———————————————

You talk a big game, but I gather you are a VB code monkey working for a large company – perhaps a bank.

#198 TnT on 07.11.13 at 7:18 pm

#194 Craig

That is not a typo… I guess you never got paid a bonus?

Slightly more than half is taxed up front, when I see the payment stub.

#199 Valerie Keefe on 07.11.13 at 7:53 pm

@zeeman1 #163

What, the chest-pounding proto-Hayekian hasn’t ever heard of a per-capita GDP indexed Basic Income? Yet another fundie who only reads the parts of the book he likes, I imagine.

And yes, entitlements are better, more human, more economically efficient, than income-and-worthiness-tested patchwork supports. Though I suppose you’re against it all… not your fault though. That visceral disgust at the thought that someone, somewhere, might have it better than you is hard-wired.

http://stumblingandmumbling.typepad.com/stumbling_and_mumbling/2013/04/benefits-biases.html

#200 Jeremy on 07.11.13 at 8:09 pm

Sadly, the top marginal tax rate in Ontario is 49.53% … on income over 509,000

#201 Holy Crap Where"s The Tylenol on 07.11.13 at 8:50 pm

#166 Smoking Man on 07.11.13 at 3:18 pm
#153 Holy Crap Where’s The Tylenol on 07.11.13 at 2:08 pm

So for all of you whom derogatorily call employees slaves please note I take offense at your lack luster vocabulary on behalf of the hard working honest people out there who aspire to become someone better.

So Richard Branson of you

Nice, see in real life I say the same thing to dogs. I play the same actor, but inside my head, logic rules.

Why would anyone slave like dogs for me, when it easier to set up shop. I have no real respect for them…

I m not sorry I offended you cause you’re lying… And if your not and that naive, a smoking man in you origination will steel your business..

Dear Smoking Man, last time I recalled my corporation employed 93 people, I will not divulge the corporations gross revenue however it it has eight figures. I employ people, you however work for someone somewhere on Bay Street. See I may be old but I recall your blogs. Lesson number one my friend we all work for someone else and don’t forget it! I work for my customers and report directly to them. Call me when you contribute 93 positions to the local economy!

#202 Holy Crap Where"s The Tylenol on 07.11.13 at 8:58 pm

#199 intuition on 07.11.13 at 7:09 pm
You talk a big game, but I gather you are a VB code monkey working for a large company – perhaps a bank.

Intuition you are probably as close as anything on Smoking Man, I had a senior moment and recall he had some hookup with a company called Alga3. I think he is a programmer or something close.

#203 espressobob on 07.11.13 at 9:27 pm

#166 & #153

Sorry dudes, you got nothing on me! The difference between us is I abuse people in a constructive nature! I’ll kick anyones ass off the the wall if benefits them!

Bringing out the best others have to offer is the win! Slaves? Get real!!!!!

#204 lee on 07.11.13 at 9:33 pm

#196

No. I actually did mean they would pull out of the stock market while attending a mass. But your choice of words probably makes more sense.

(Now don’t tell me I shouldn’t start a sentence with “But”.)

#205 KindaDifferent on 07.12.13 at 1:03 am

#128 Justin, I can totally empathize with your frustration…$9.75 for a day pass to ride the Vancouver transit is too much and not getting a minimum of a four hour shift is immoral. You’re a good writer and I hope you can affect change as the economic situation is really dire and leaves the young people feeling hopeless.

#206 Mal on 07.12.13 at 2:36 pm

My spouse and I decided to buy a new 2 bdrm condo last year rather than rent. In five years, we will have paid ~$70,000 in mortgage payments and built $35,000 in equity before we turn 30. Rent would have cost us anywhere between $60,000-$75,000 in Victoria for a mere roof over our heads and a modicum of privacy!

We save what we can and I like to think of our mortgage as forced savings. We will always need a place to live. I’d rather spend 25 years paying a mortgage and have an ASSET than spend that time paying rent for NOTHING.

My parents and in-laws both, after years of bad decisions, have barely any equity and zero savings. This is the reality for many of my friends’ parents as well. Every bad decision, move and separation of the household cuts into your savings. Stop trying to flip houses. Stop moving. Stop getting divorced. Stop being stupid.

And cut down on the Kool-Aid, kid. There’s more to being in your 20s than paying a mortgage. — Garth

#207 antiflakflak on 07.13.13 at 2:03 am

Gregor Robertson is the face of Agenda 21, yet no one puts those facts together, hoping you have never even heard of Agenda 21. (This whole province (BC bring cash) is on the Agenda 21 bandwagon, hence the carbon tax, and the land’s most expensive gas.)
Yes they want you trapped in urbanity, with your bicycle, unable to escape when the big one hits. We shouldn’t drive cars because they are so bad for the environment, Well that is not my fault, nor many others, unfortunately am held hostage to bad technology design/ers– Gregor Robertson is a kook and Agenda 21 sell out BEWARE
Gregor Robertsons wife looks like she needs to eat some real food, or attend the St Pauls anorexia nervosa clinic.

#208 George on 07.13.13 at 9:45 am

Boomers still think the news is news, the right are conservative, the left are a bunch of commies and that it’s still 1981. I really hope your scenario occurs Garth. Keeping the faith is hard.

Boomers in Australia had houses for about $200k-$500k in real terms. Now they’re all worth about $1m+. They had it ridiculously easy.