Lost

KID

In 2009 the world was falling apart, along with some guy’s marriage. Jim swooped in and vultched the unhappy couple’s $200,000 condo in suburban Vancouver for just $150,000. He felt like a genius, paid some closing costs and took out a 100% mortgage.

“At the time,” he says, “I was a high-income-earner in the finance sector (oh, the irony), however the story changes.”

That’s an understatement. Jim lost his wife, then his business and his job. It took him an entire year to find work (“I recently started working for a ‘fair’ wage”) and now he has $130,000 in unsecured debt and a condo worth less than the $145,000 left on the mortgage. “I have no net worth at all, and it’s only a matter of months before the creditors start hounding me.”

Jim asks me what he should do. “Selling the place is out of the question since it’s a net loss and I’m already up the creek financially anyway. I just wonder how much more it can drop. Add to all this the worry of my job (how stable is my job really?).  The fact it took me a year to find a job also makes me pretty darn paranoid.  Who’d of thought being an expert at something with education and contacts wouldn’t be enough?

“Curious what you would do.  I’m willing to be there are a lot of other people out there in somewhat similar situations.”

Well yesterday this pathetic blog talked about deflation. It’s not here yet, unless you’re Jim. He’s pretty much screwed. But he does offer a nice life lesson on what happens when all your assumptions turn to dust. Apparently love and condo prices don’t last forever, even in horny BC. As the economy softens, disposable income falls, your postie’s fired and the local Best Buy and Sears stores close, things start looking a lot different. Someday you’ll wake up, look back, and say ‘what were we all thinking?’

This week has brought some juicy juxtapositions. For example, here’s Remax with a year-end media release that reporters can conveniently put their bylines on and run as news. “It’s still a hot market,” it says of Toronto. “Move-up buyers continue to represent the lion’s share of activity, driving sales of properties between $600,000 and $1 million.” The company is forecasting that “serious momentum” will cause a surge in sales and prices in 2014.

In Vancouver, more delusion. When the Province newspaper asked Sotheby’s real estate division CEO Ross McCredie where the housing action is, he said the following. Seriously. “West Vancouver is the hottest market in the Lower Mainland with a nine-per-cent jump in the single-family home benchmark this year, to $1.9-million. And while Vancouver’s west side was downin the spring, by November the tony market had rocketed back to gain three per cent year-over-year, at nearly $2.1 million for a single-family property.”

Based on that, the paper ran this headline: “Vancouver-area real estate market looks healthy for 2014, experts say.” Mother of God, forgive them.

And then there’s poor Calgary, which a Globe column warned last week has the potential to become Canada’s Detroit – a one-trick-pony town where people actually believe booms never end. It’s so cute. The real estate board’s economist (everybody should have one) is forecasting 4.3% higher prices in 2014 because of immigration, wage growth and a tight rental market. Adds Don Campbell, the real estate cult leader who is such a perfect Albertan, “With all of the factors lining up as they are, we should be witnessing the Calgary housing market out-perform most others in the country and frankly out-perform its underlying economic fundamentals as the pendulum swings solidly into seller’s market territory later in the year.”

See, Jimbo, there’s absolutely nothing to worry about. The ‘experts’ (who all make their living flogging houses) see only sunshine, ponies and virgins in the economic forecast. Lighten up, already. And whatever you do, stay away from Germans. Volkswagens, strudel, Porsches, bad haircuts – the whole deal. They’re so judgmental.

Here’s Deutsche Bank with the gall to write a report saying Canada’s housing market is overvalued by 60%. The most gaseous airbag in the world, when prices (especially in Vancouver and Toronto) are compared with the rents houses command, or the incomes of people buying them. Based on this, Vancouver (a regional city north of Seattle with 2 million people) is now more expensive than New York (the financial capital of the world, with 8.5 million residents and Bon Jovi).

But it’s not just housing that’s got their lederhosen in a knot. The bank also says the level of debt Canadians have embraced – credit cards, mortgages, lines of credit – compared to earned income, is off the charts. Which brings us back to an underwater condo and unrepayable bills.

People have made a mighty gamble. That they could buy what they cannot actually afford. That rising prices (like Remax says) would make it all okay. And that they’re smarter than everyone else.

How’s that working out for you, Jim?

179 comments ↓

#1 ILoveCharts on 12.11.13 at 8:33 pm

You missed the rest of the article in The Province…

It’s all about the HAM.

“While official data on rates of foreign investment is difficult to track, McCredie believes that in Greater Vancouver foreigners account for about 50 per cent of purchases above the $2-million price range.

McCredie said Vancouver’s market is driven by almost twice the rate of foreign investment as Toronto, the next most popular Canadian market for offshore buyers.

“The reality is that even wealthy Canadians are priced out of Vancouver markets now,” McCredie said. “We see a lot of foreign demand in very specific neighbourhoods like Point Grey. And we think in 2014 you will see continued demand east of Main in Vancouver, and even out to Burnaby.””

No, I read it. More yellow peril realtor tactics. — Garth

#2 CrackHead Crackservatives on 12.11.13 at 8:35 pm

You stupid crack somking crackservatives have ruined Canada and Canadians with the most OVER VALUED HOUSING MARKET in the world. Take a bow you CRACKHEADS.

#3 CrackHead Crackservatives on 12.11.13 at 8:37 pm

Crackservatives who SMOKE CRACK have given away $600,000,000,000.00 is sub-prime mortgages and this does not include genworth. You crack smoking crackservatives are so clueless as mom and pop close down and companies close down. Good job you crackservative harper . Keep smoking crack Harper and F.

I think we get it. Move on. — Garth

#4 totalinvestor.com on 12.11.13 at 8:39 pm

Canadian REITs: Super Buys: Dundee Real Estate Investment Trust (TSX:D-UN),Northern Property Real Estate Investment Trust (TSX:NPR-UN)

http://totalinvestor.blogspot.ca/2013/12/canadian-reits-super-buys-dundee-real.html

#5 mark on 12.11.13 at 8:44 pm

As some dude said in the G&M comments

Poppycock! We’re going to keep selling houses to each other for higher and higher prices, and we’ll all be rich!! The other countries are just upset they didn’t think to do this.

#6 Babblemaster on 12.11.13 at 8:49 pm

As stupidly rosy as Remax’s predictions have been, the fact is they’ve been turned out to be right for quite a number of years running now.

#7 Bob Copeland on 12.11.13 at 8:53 pm

Jim, I feel ya. Remember, life goes on and always gets better! Been there, done that. Now that only I spend my money cash is the problem.

#8 Smoking Man on 12.11.13 at 8:54 pm

#199 45north on 12.11.13 at 7:01 pm
smoking man: Apparently some shrinks, mostly females with perfect nail polish, clip boards and Starbucks Latte got together and invented a new disorder for the DSM.

the school boards have jumped on the anti-bullying bandwagon – I guess they did some focus groups. I heard one 10 year old accused the other girls of bullying her. Whatever.

what’s DSM?
……………………………………….
Dyslexic Smoking Man? Nope see link

http://en.wikipedia.org/wiki/Diagnostic_and_Statistical_Manual_of_Mental_Disorders
……………………………………………………………

I think we get it. Move on. — Garth

Come on Garth that’s LaughingCon’s handy work. Been his fan for 7 years.

Style never evolves

#9 Babblemaster on 12.11.13 at 9:02 pm

A suburban Vancouver condo worth less than $145,000.00? Yeah. Sure. I don’t believe it. Not unless it’s in one of those crack condo buildings next door to the needle exchange clinic. However, if he does have $135,000.00 unsecured credit and is underwater on his condo, then he should just declare bankruptcy.

#10 Kurt on 12.11.13 at 9:03 pm

Jim,

Bankruptcy is expensive. Start now, while you can still afford it. Get used to the idea that you’ll never borrow money again. Sucks, I know, but you are screwed. You need to acknowledge that and take immediate action to stop the bleeding.

Just my opinion, of course, and you generally get what you pay for. Maybe you should shell out a couple of grand to Garth instead of asking for free advice. This will be the second-most important decision of your life.

After you’re discharged, you’ll have something for which the rest of the population will pay even more than you did: wisdom.

#11 Pounding sand in Peachland on 12.11.13 at 9:08 pm

This is more fun than twitter

#12 Bobby on 12.11.13 at 9:14 pm

Apparently all of that wine and roses hasn’t descended on the Victoria market. I guess the realtors here didn’t get the memo.
Lots of expired listings that are just dropping off. Also, cannot believe the number of units, both homes and condos, that are just sitting empty.
What the Remax headline should really be reading is
Bah Humbug!

#13 tigerbaby on 12.11.13 at 9:16 pm

> All deflation is not bad, if one describes it as falling prices.

deflation is better described as falling incomes and available goods and services

#14 Observer on 12.11.13 at 9:18 pm

Home transactions in Hong Kong will probably drop about a third from 2012 to as low as 52,000 this year, the fewest since 1996, according to Knight Frank LLP. The number may fall to 45,000 next year, said the London-based property broker.

“The worst is yet to come,” said Angela Wong, an executive director at Hong Kong-listed Midland Holdings Ltd. (1200) “The pressure on brokers won’t go away as long as deal numbers stay at such low levels. It’s clear the government will impose more measures whenever they see things pick up slightly.”

http://www.bloomberg.com/news/2013-12-08/home-price-curbs-chopping-10-000-hong-kong-agents.html

#15 Slo on 12.11.13 at 9:19 pm

Vancity buzz ran this little article to put things into perspective.

http://www.vancitybuzz.com/2013/12/vancouver-vs-beverly-hills-what-4-89-million-will-buy-in-real-estate/

I want to move to california now?

#16 eastvanner on 12.11.13 at 9:19 pm

I am not an owner, but I wish I was. The Vancouver housing market is not governed by what is occurring in the rest of Canada. Toronto may crash, Calgary may crash, but Vancouver never will.

Here’s why – there’s about 10 million millionaires in China, and China is a horrible play to live – 15 times acceptable air pollution levels type horrible. All you need to move to this country is $800,000 – a drop in the bucket for these wealthy people. Couple that with a thriving asian community here in Vancouver and you see – you’d be crazy not to leave China and come here! The price here depends on what the Asian economies are doing, it has nothing to do with the Canadian economy. As China continues to grow, more and more are going to come here and by real estate. There really is no end in site.

Vancouver is the best place in the world, easy and without question. So no, Vancouver prices will never crash, not in my lifetime and probably not in my kids lifetime. If you didn’t buy when you had the chance, you probably never will.

#17 Marco Polo on 12.11.13 at 9:20 pm

So, Remax says it’ll be a great time to buy a home next year. I’m sure if I checked with my car dealership, furniture store, and boat salesman, they’d be honest with me, and tell me to wait a year of two before jumping in, right?

By the way, here in 2010, 2011, do you recall hearing about a string of layoffs? Do you remember one or two outside RIM? I don’t. Things are slowing down, a much quieter year in the oil patch too.

Houses aren’t selling here in Edmonton, I note areas closer to Saskatchewan seem to be cooling on prices too. I think some of the hysteria is out of this market. Anyone asking a ridiculous price won’t be selling their home anytime soon.

#18 tigerbaby on 12.11.13 at 9:23 pm

> I have children who are 27 and 26 yrs old and I do not see them being able to afford the same standard of living that I do.

back a few decades, a high school diploma in NA put you at ~ 90th percentile in world population. the same put you at ~ 50th percentile today. the standard of living adjust accordingly.

#19 Mocha on 12.11.13 at 9:23 pm

Lol, “bad haircuts”…?

Seriously though, sad to hear about another 8000 jobs going down the sh^tter.

#20 Toon Town Boomer on 12.11.13 at 9:24 pm

Maybe Remax is full of Sh*t

http://www.huffingtonpost.ca/2013/12/11/job-market-canada-2013_n_4421034.html

#21 Okotokian on 12.11.13 at 9:25 pm

RE reminds me of the barn below.

http://tinyurl.com/otyhroq

How’s it still standing?

#22 Shawn on 12.11.13 at 9:25 pm

Gettin’ Rich for Nothing

Speaking of getting rich by selling each other our houses at ever higher prices…

Same applies for Gold, rare stamps, rare coins, collectibles of any kind, paintings.

It does boggle the mind that a such items can fetch higher and higher prices… No value added. Just buy, store and sell later for a higher price.

It works great, until it stops working.

#23 High Net Worth Renter on 12.11.13 at 9:29 pm

As a friend of mine remarked several years ago: “There’s a big difference between being able to buy a Ferrari and being able to afford a Ferrari”.

#24 Ronaldo on 12.11.13 at 9:33 pm

QE forever?????

http://www.marketwatch.com/story/central-banks-will-move-goal-posts-to-keep-qe-forever-2013-12-11?pagenumber=2

#25 Smoking Man on 12.11.13 at 9:36 pm

Jim asks me what he should do.

Be creative, lie, approch presidents of companies and tell them you can get them sales in Asia. Then do it.

Shoot Aim

Has always worked for me.

#26 Canadian Watchdog on 12.11.13 at 9:38 pm

How ironic is it that the number 60 also happens to be Deutsche Bank's leverage ratio, perhaps the highest in the world, in fact, so bad that the FDIC's vice chairman labeled them as "horribly undercapitalized".

Insolvent banks analyzing inflated housing markets. That's how mad the global economy has become.

#27 Mister Obvious on 12.11.13 at 9:44 pm

#9 Babblemaster

“A suburban Vancouver condo worth less than $145,000.00? Yeah. Sure. I don’t believe it. Not unless it’s in one of those crack condo buildings next door to the needle exchange clinic”
——————————

“Babblemaster” is a most appropriate handle.

Here’s a one bedroom in Surrey listed at $139,800. I’ve actually been in this building. It’s not anywhere near the worst Surrey has to offer. No Rob Fords in there. Just honest, hard working folk.

There’s 6 more similar one bedroom condos in the same building ranging up to $179,900.

http://beta.realtor.ca/propertyDetails.aspx?PropertyId=13671039

#28 Smoking Man on 12.11.13 at 9:45 pm

Continued,

Remember this Jim all presidents of company’s are gamblers they have to be or they would not have the job.

They don’t think like slaves, risk vs reward, that’s how they will evaluate a pitch, if your pitch is good, or the guy likes you. Your home free.

Remember revenue generators make all the loot, crumbs go to the overhead.

What ever you do, never compromise your life style. Just find more creative ways to make loot.

And remember, you could be six feet under in a week.

Enjoy, it’s only money.

#29 aprilNewwest on 12.11.13 at 9:52 pm

Ok Babblemaster #9 – check out MLS for the Lowermainland BC. I know most of these areas with listing well under $150 and they are in respectable areas.
Why do you believe what the RE cartel has to say. It’s their living …you expect them to tell us the real story.

#30 Lex on 12.11.13 at 9:53 pm

The kind of guy interested in a RE license. (See his twitter profile tagline at the bottom)

http://www.bleedingcool.com/2013/12/10/the-man-who-started-a-comic-store-by-stealing-from-a-comic-store/

#31 Meister on 12.11.13 at 9:54 pm

Lederhosen LOL

And the crack guy…

No, really, there’s nothing funnier on TV.

On topic, suburban or not… a condo for the 140-odd grand he owes is pretty good, I’d say servicing that loan at current interest rates is probably cheaper than renting just about anything in that metro area. Not sure what he means by “fair wage”. I assume Garth knows. If he’s grossing at least 40 grand, I’d say he can pay his damn mortgage and live a decent but not decadent life. Unless he has other debt. He didn’t take a home “equity” loan, did he?

#32 X on 12.11.13 at 9:56 pm

Such a shame that RE ‘experts’ can provide such an opinion to the unknowing, all the while lining their own pockets, without warning, repercussion or penalty.

The system is failing us in this regard.

#33 T.O. Bubble Boy on 12.11.13 at 9:58 pm

Fun stat of the day:

Counting transfer payments such as foods stamps, Medicaid, Medicare, and other government welfare, Congressional Budget Office (CBO) analysis shows the top 40% pay 106% of all taxes (more than all of them). In turn the bottom 60% get money back.

http://globaleconomicanalysis.blogspot.ca/2013/12/rich-dont-pay-most-of-taxes-they-pay.html

#34 Smoking Man on 12.11.13 at 10:01 pm

#18 tigerbaby on 12.11.13 at 9:23 pm
> I have children who are 27 and 26 yrs old and I do not see them being able to afford the same standard of living that I do.

back a few decades, a high school diploma in NA put you at ~ 90th percentile in world population. the same put you at ~ 50th percentile today. the standard of living adjust accordingly.
………………………………………………..

Making a living from wages is a dwindling proposition in all industry, competing globally now, we suck.

Can’t be done, make a 1% income trading time of wages less of course your a brain, have good connections. Even the ones with connections are in a shrinking market to help there own kids.

If that’s aint you.

You got to trade, buy and sell shit or business services.

Only way it’s going to happen for the kids today.

But it’s hard for them to think that way.

school training did them in.

#35 Suede on 12.11.13 at 10:10 pm

Actually Garth, New Jersey has Bon Jovi

Now there’s an alpha in the music biz. Has his fingers in so many pie’s making nice coin and atrocious hits lately.

#36 Obvious Truth on 12.11.13 at 10:18 pm

Livin on a Prayer

Maybe jim can work on the docks.

Oh wait. Imports and exports down.

Pick yourself up jim. You are young and can learn to do anything. It’s not meant to be easy. And everyone makes mistakes. I myself vultched in 09 on a property and may end up under for a time. But I love it.

On another topic and in light of volker rule.

Does any one suspect that a decrease in interest on reserves will cause banks to buy treasuries for extra juice thereby keeping yields in check? Is this the new liquidity source? Garth?

#37 Porsche on 12.11.13 at 10:22 pm

Kellogg’s yesterday
Canada Post today

#38 Freedom First on 12.11.13 at 10:22 pm

Poor Jim. I have known so many Jim’s throughout my life. Sad.

Even sadder Garth, I have handed out your Blog address to a bunch of people in Jim’s mindset, and the best feedback over the last few years I have received from your Blog recipients Garth, is: “I read it a couple of times”, and then I was unceremoniously turned away from. Many people have their fixed ideas, like Jim, and are not open to thinking. Ignorance is not bliss, it is devastatingly painful and life ruining. Keep up the good work Garth. You have, and continue to speak the truth, and have helped many people from financial ruin, much to the chagrin of the unethical liars perpetrating this scam. And you have had the steel gonads to expose them publicly by name. I love it! Thank you Garth.

#39 Babblemaster on 12.11.13 at 10:25 pm

#27 Mister Obvious

Doesn’t look too bad, but that’s quite a jaunt from Vancouver. I was thinking more like Burnaby, but I’ve now checked and that little suburb also seems to have a fair share of listings in that price range.

#40 Nemesis on 12.11.13 at 10:31 pm

“No, I read it. More yellow peril realtor tactics.” — HonGarth

I’m struggling to MakeZen this week, AuldPol…

YourBad, GT… if you weren’t such a GoodWriter, I would be in a FarFarBetterMood. Really.

Right, that said… it’s HighTime for for ClairvoyantZen [aka CautionaryTales]… in that vein: this is best that Nem can do tonight, SaltyDogz… &WithApologies.

Oh yes, the juxtaposition is critical to the joke, as it were [by the way, SaltyDogz – I always thought that MaryAnn was – like! – WayHotter! than Ginger. I blame it on CalicoTieUps].

http://img11.imageshack.us/img11/9413/sisland065.jpg

http://www.wiso.uni-hamburg.de/fileadmin/sozialoekonomie/hund/sonst._bilder/bikinibomb.jpg

[NoteToRalph: HamburgUni? Herausragende Frauen!]

#41 Infused with Opiates on 12.11.13 at 10:34 pm

“The most gaseous airbag in the world, when prices (especially in Vancouver and Toronto) are compared with the rents houses command………….now more
expensive than New York (the financial capital of the world…………..”

Interesting. Renting in NYC has been described as unaffordable.

http://blogs.villagevoice.com/runninscared/2012/09/rents_are_reall.php

#42 Patient in Richmond on 12.11.13 at 10:35 pm

Eastvanner
keep believing
its now going to last . the chinese are not coming anymore .
They never did , sure a few but not in the numberyou were lead to believe . Few houses here already dropped by 100.000 in the last few month . its just the beginning ….you watch….

#43 Tri-Guy on 12.11.13 at 10:38 pm

Wont somebody please think of the mailmen.

#44 Devore on 12.11.13 at 10:45 pm

#33 T.O. Bubble Boy

It’s been a well known fact for a while now that the bottom 50% Americans pay no net federal taxes.

#45 Macrath on 12.11.13 at 10:47 pm

“Curious what you would do. I’m willing to bet there are a lot of other people out there in somewhat similar situations.”
——————————
Gosh! advice for an up the creek educated Financial sector expert.

Keep one eye on your job and one eye on the want ads.

Most of the other people out there in somewhat similar situations are learning about food banks and getting advice from the “til debt do us part” jar lady.

#46 DON on 12.11.13 at 10:48 pm

#16 eastvanner on 12.11.13 at 9:19 pm

I am not an owner, but I wish I was. The Vancouver housing market is not governed by what is occurring in the rest of Canada. Toronto may crash, Calgary may crash, but Vancouver never will.

Here’s why – there’s about 10 million millionaires in China, and China is a horrible play to live – 15 times acceptable air pollution levels type horrible. All you need to move to this country is $800,000 – a drop in the bucket for these wealthy people. Couple that with a thriving asian community here in Vancouver and you see – you’d be crazy not to leave China and come here! The price here depends on what the Asian economies are doing, it has nothing to do with the Canadian economy. As China continues to grow, more and more are going to come here and by real estate. There really is no end in site.

Vancouver is the best place in the world, easy and without question. So no, Vancouver prices will never crash, not in my lifetime and probably not in my kids lifetime. If you didn’t buy when you had the chance, you probably never will.
8888888888888888888888888888888888888

In the late 80s early 90s – the Japanese were all supposedly coming to live in Vancouver. Now it is the millionaire Chinese hmm and China is going through their anti corruption phase…looking to put a stop to the money flowing out. Can you imagine the Chinese version of the IRS or CRA coming after you…YIKES

Sounds like you bought a house in east van.

#47 Crazy Caper on 12.11.13 at 10:49 pm

Hey Garth,

I always look forward to your articles, they are always very insightful and luv your comedic genius. Keep them coming big stick.

#48 chickenlittle on 12.11.13 at 10:56 pm

This site attracts some interesting people. Some claim to be raking in the dough, while others are losing their shirts.

I guess predictable times are over!

#49 Herb on 12.11.13 at 11:00 pm

#43 Tri-Guy,

careful what you wish for! Some of the mongrels in this kennel usually blame the victims.

#50 Catalyst on 12.11.13 at 11:01 pm

In other news, the guys at ontario power are giving each other 390K moving expenses and 150% base pay bonuses, and 62% of employees make over 100K. Clearly I can’t afford real estate because I don’t work for government.

Can you hook a brother up Garth?

#51 CantRememberMyName on 12.11.13 at 11:02 pm

I still love this blog. I feel for the Posties being a former Canada Post employee for 20 years through High School, College, etc. Never cracked FTE though. I was classified a Seasonal Part-Time Replacement something or other employee who basically worked summers, holidays, last minute someone called in sick or went on holidays replacement person.

Good people most of them. Down to earth. I always had a different career path however and used CP to get there. Canada Post helped me very much to build my Life when I was younger. I still salute their trucks whenever I see them. I felt sick when I heard the news today O Boy.

But the world is changing and you have to change with it. Gotransit, TTC, Beware! Supposedly cars have already learned to park themselves and apply brakes when something is too close. Also, GPSs work better with other machines than humans. Birds of a Feather I guess. Turn off your phones. :)

Progress eh? The dumber we get as a society, and it is happening, the poorer Quality of Life we will see. iPhones and all. Relate to Garth Turner and be smart with your money.

#52 nonplused on 12.11.13 at 11:05 pm

#16 east vanner

Get yourself a Geiger counter and stick it in the water out there. Nobody is going to be moving to the coast a few years from now.

And “Best Place On Earth”? I guess if you like congestion, high prices, and taxes. Sure, it’s beautiful. But so is the Yukon. It’s no place to live though. Personally, I prefer Denver. Why aren’t all the Asians buying there? It’s a lot cheaper and the quality of life is top notch if you can deal with the health care thing. “Best Place On Earth” – it’s so arrogant. Better than Paris? What about Amsterdam, that place is pretty cool. Don’t get me wrong, I love BC, but it’s not the best place on earth, if there could be such a thing with the world having so much to offer.

Back to Garth’s comments.

Alberta is indeed screwed if we can’t find a way to increase export capacity. The US doesn’t need as much of our gas as they used to mostly due to the Marcellous and associated gas from the Bakken and the Eagleford. Politics, Warren Buffet (rail), and tepees are land locking our oil. It is indeed a rough situation and the squeeze looks to get worse before it gets better.

Encana isn’t the only one laying off. And it looks like the number was more than a 5th. I know many people who are still there and they are really shaken up.

I was at Encana myself, but I’m one of the 20%. A lot of well respected people I knew for years also got let go. I guess the day they did the new grads the lobby was a tear fest but I got to pack up a few days earlier.

Don’t get me wrong, I have every respect for the company and know they are facing some serious challenges. Something had to be done. And so far as I can see they treated everyone well. Hopefully these changes will mean the company can remain a viable part of the economy and continue to generate wealth, albeit in a somewhat scaled back manner. If so, they will be able to make it through these times and perhaps become an engine of growth when things improve.

The truth is though, although Encana might be the most public and maybe most dramatic downsizing, everyone in the oil and gas patch in North America is having the same discussion and in varying stages of taking similar action. Particularly gas weighted companies.

Thank goodness I have been following Garth’s advice (well, sort of mostly) since he started the blog and wrote “Greater Fool” and also was worried about whether my job would go through. My wife is back at work and we have taken steps to eliminate as much debt as we could. When I say “sort of mostly” we didn’t take on debt to invest because I was/am too worried about whether the loans can be self extinguishing in this environment and I saw the Alberta train wreck coming a long time ago. I also could have done a better job with portfolio rebalancing. But all things considered I’ll be ok if I can get back to work within 6 months, hopefully earlier. I’ll be targeting a different sector if I can. Alberta E&P will be down and out until the midstream companies can get the product to better markets.

#53 raisemyrent on 12.11.13 at 11:10 pm

#16 eastvanner on 12.11.13 at 9:19 pm
I am not an owner, but I wish I was. The Vancouver housing market is not governed by what is occurring in the rest of Canada. Toronto may crash, Calgary may crash, but Vancouver never will.
Here’s why – there’s about 10 million millionaires in China, and China is a horrible play to live – 15 times acceptable air pollution levels type horrible. All you need to move to this country is $800,000 – a drop in the bucket for these wealthy people. Couple that with a thriving asian community here in Vancouver and you see – you’d be crazy not to leave China and come here! The price here depends on what the Asian economies are doing, it has nothing to do with the Canadian economy. As China continues to grow, more and more are going to come here and by real estate. There really is no end in site.
Vancouver is the best place in the world, easy and without question. So no, Vancouver prices will never crash, not in my lifetime and probably not in my kids lifetime. If you didn’t buy when you had the chance, you probably never will.

the federal programme that allowed this was turfed in June 2012. btw, you also needed 1 million proven net worth, and the 800,000 was given back to you without interest a few years late (forget how many).
The only province that still allows this is *drum roll* Québec… and apparently they’ve been lax about making people actually live in la belle province but not lax about using their money for a while (free loan).
it also takes a while (like, over a year) to get permanent residence. People seem to imagine Chinese walking in with loads of cash and walking out with a Canadian passport, ink still fresh. haha whatever helps you sleep at night

also, rich foreigners DO NOT, I repeat, DO NOT get mortgages insured by CHMC, especially at the same rates as all good Canadians who have always done as [email protected] has suggested. Some banks outright refuse to give mortgages to foreigners.
“the market” is all your friends, not some wildcard you read about in the news.

p.s. way to generalise; read a book about China, maybe even approach some Chinese people while you’re at it (see how many are millionaires too lol).

#54 LJ on 12.11.13 at 11:11 pm

From the Canada post official release today (p22): “The (pension) plan has a solvency deficit of $6.5 billion.”

That’s the culprit!

And, it explains that your tax dollars will be going to plug the gap.

Full document: http://www.canadapost.ca/cpo/mc/assets/pdf/aboutus/5_en.pdf

#55 Money talks on 12.11.13 at 11:20 pm

The December 2013 Bank Of Canada Financial Review…

http://www.bankofcanada.ca/wp-content/uploads/2013/12/fsr-december2013.pdf

“A number of actions are needed to mitigate the risks and vulnerabilities related to the housing market and household finances.”

“While many households have managed their exposures to future increases in interest rates by shifting into fixed-rate mortgages, approximately one-third of the outstanding stock of mortgage credit has variable rates, and the size or structure of payments would be immediately affected by a rate increase.17 In the case of a sharp interest rate increase, perhaps due to an overshooting in global interest rates as a result of a withdrawal from unconventional monetary stimulus, the effects on these households would be significant.”

#56 Smoking Man on 12.11.13 at 11:25 pm

#37 Porsche on 12.11.13 at 10:22 pm

Kellogg a revenue generator, BAD
Canada Post overhead, GOOD

#57 DJG on 12.11.13 at 11:28 pm

I love these stories… Which “high income earners in the finance sector” live in crappy condos in what I assume from the description is god-awful Surrey or Burnaby? And as others have pointed out, who would struggle to service the approx. $850 / month it would cost to service the mortgage if they’re making a “fair wage”?

I believe that Canadian housing is overvalued, but the comparisons to many other world markets are simply not realistic. In my hood of Rosedale-Moore Park, for example, one of the wealthiest neighbourhoods in Canada, average detached house sales were $1.175 million in 2012. Let’s look at Kensington & Chelsea in London. The average semi-detached price is $8.15 million.

Median household income in Kensington & Chelsea? About $190k. In Rosedale-Moore Park? $175k.

What about the Upper East Side? Average home price is just under $2 million. Median income is $83k.

The income numbers are quite misleading. Multiples of rents similarly so, if you compare the average monthly rent in Chelsea ($6k) to the value of housing. These are some of the many, many pockets in which the asset-rich live. But it does demonstrate how housing is, in many markets where people with lots of assets live, completely disconnected from lots of other indicators.

It’s perfectly plausible that house prices will stay high in Toronto and Vancouver proper.

#58 Mr Happy on 12.11.13 at 11:30 pm

Deflation….huh…..

Sold another toy….another $15000.00 in cash tucked away…

I’ve been tucking cash away while I wait for the next smart move to make. Put 100k into a bond fund a few years ago when Garth hinted that way (thanks buddy).

Paying attention to what the next smart move will be….

wink wink…… :o)

#59 Son of Ponzi on 12.11.13 at 11:30 pm

“Lederhosen im Knotten”
Das ist lustig.

#60 Nomad on 12.11.13 at 11:31 pm

I agree with “eastvanner”. The 5000 employees company I work for actually regularly hires from China. Why? The talent divided by salary is better. When I ask them what they think of house prices, they tell me that they’re willing to make sacrifices, that it’ll be easier for their kids. Anyways, the conditions are so much better here.

I don’t own property. I own stocks and buy more when others are scared (preferred, REITs, international and US indices). If condos don’t get 25% cheaper in Toronto within 2 years, my wife and I will go back to California: their houses are cheaper, their money probably worth more in the future, and you can deduct your mortgage interest and property taxes. Mobility is king.

#61 Smoking Man on 12.11.13 at 11:32 pm

#43 Tri-Guy on 12.11.13 at 10:38 pm

I think about the mail man every time I look at my kids, damn, no resemblance.

#62 Seeing it from both sides on 12.11.13 at 11:38 pm

“Canada’s housing market most overvalued in the world, Deutsche Bank says ”

He’s obviously never been to Singapore or HongKong, where they talk in $thousands per sq.ft vs our $hundreds/sq. ft.
Downtown Vancouver and Abbotsford are not only both in Canada but also in the same province (an hour and a half’s drive apart as a matter of fact) but the prices are day and night. The headline is a useless sweeping generalisation. Vancouver metro has always been expensive, because, believe it or not, it is very desirable to live in the core.

The qualification was clearly stated – expensive relative to rents and incomes. In other words, local delusion. Thanks for illustrating. — Garth

#63 ILoveCharts on 12.11.13 at 11:39 pm

@ #54 LJ.

I’m afraid. What does it mean? Surely with fewer employees coming into the company, the pension plan will fail. Aren’t most pension plans ponzi schemes that rely on constantly increasing company sizes?

Will we be picking up the tab on this one?

#64 Waterloo Resident on 12.11.13 at 11:43 pm

My lady-friend in Toronto bought a $300,000 condo last year, she feels really smart for buying it, even though she has to have her mother pitch in with half of the monthly mortgage payments because she herself cannot afford to pay the whole thing.
Anyways, yesterday she called me and asked me if I would be interested in partnering with her to buy a townhouse in Toronto. I almost choked! My instant thought was; “NOT ON YOUR F-ING LIFE!”
But then I said “but don’t you already have a place to live; your condo?” She said yes, but she plans to rent it out and invest in another real estate investment. I told her ‘no thanks’, I don’t know what the future holds right now and until the economy starts to create jobs in sizable numbers I’m not buying anything but the absolute essentials, and a new Townhouse is not life-and-death for me right now.

#65 Basil Fawlty on 12.11.13 at 11:45 pm

Is there any particular reason that companies like Kellogs and Canada Post announce impending massive downsizing two weeks before Christmas, or am I just old fashioned?

#66 OttawaLuke on 12.11.13 at 11:49 pm

My commute to work is now showing multiple power of sale signs on top of the excessive sunday open house gatherings. Brace yourselves…

#67 jan on 12.11.13 at 11:52 pm

Basil Fawlty on 12.11.13 at 11:45 pm Is there any particular reason that companies like Kellogs and Canada Post announce impending massive downsizing two weeks before Christmas, or am I just old fashioned?

This is Canada man.
They will walk with a million dollar severance packages.

#68 Sockeyemoon on 12.11.13 at 11:54 pm

Remax says “serious momentum” will cause a surge in sales and prices in 2014…
My friend always makes ‘contrarian indicator’ choices.

He buys investment and houses when they’re high and sells them when they’re low. Today he sounds like he’s learned his lesson.

He bought a SFH in TO at the top of the market a year and a half a go. Now he’s asking if I think he should be selling. He says he’s worried about losing his retirement income.

I ask myself, if he’s thinking of selling it probably means it’s too late already. The moment has passed.

Look out below!!!

#69 ILoveCharts on 12.11.13 at 11:58 pm

@65 Basil:

If companies try to avoid every religious holiday by a month, they will have a very short window in which they can do anything!

Besides, if you are going to lose your job wouldn’t you rather know that before you go into the holidays so that you can make your spending decisions accordingly?

And finally, a CEO doesn’t want to carry around the emotional burden of that secret during his holidays. It’s nice to get that stuff off his chest so he can enjoy his vacation.

#70 Smoking Man on 12.11.13 at 11:58 pm

#38 Freedom First on 12.11.13 at 10:22 pm

Poor Jim. I have known so many Jim’s throughout my life. Sad
…………

Bull shit. Every zillionaire I have ever meet has made bad bets, lost it all. Started from scratch. It does something to you, makes you a bit insane. Then boom, next bet pays off huge.

Gambling works…. After you make it(get lucky) then you restrain your impulses, talk to garth pay as you go.

Till then go all in. Life is short.

The worsed one can find themselves in is to be Makin slightly above the average. No incentive. Like being stuck in a whirlpool.

#71 Paul on 12.12.13 at 12:08 am

#65 Basil Fawlty on 12.11.13 at 11:45 pm
Is there any particular reason that companies like Kellogs and Canada Post announce impending massive downsizing two weeks before Christmas, or am I just old fashioned?

Don’t worry about Canada Post. This is Harper’s doing and he’s now toast. Just watch.

#72 Here there on 12.12.13 at 12:15 am

Jim may realize now, that karma is a bitch. Apparently, the finance sector work is not his métier. Perhaps he can move to Toronto and try to find a job on the power corporation and live happily forever. And don’t have to worry that the time of milk and honey will end any time soon. Politicians of every stripe are, apparently, to busy making it or talking about the mayor to deflect the attention and keep the people happy.

#73 Victor V on 12.12.13 at 12:19 am

Kelly McParland: Ontario Liberals extend their record of knowing nothing about appalling spending abuses

http://fullcomment.nationalpost.com/2013/12/11/kelly-mcparland-ontario-liberals-extend-their-record-of-knowing-nothing-about-appalling-spending-abuses/

#74 Bikini Bottom on 12.12.13 at 12:25 am

#67 Sockeyemoon

The top of the market wasn’t a year and a half ago. Nota bene:

http://guava.ca/indicators.html

#75 DR on 12.12.13 at 12:28 am

#70 SM yes I agree with that statement….who said failure is bad?

too many people here scared to fail.

Sitting on fences, years go by. Grow some.

#76 Tony on 12.12.13 at 12:33 am

Calgary and all of Alberta’s real estate will crumble in price as oil falls and property tax hikes of around 22 percent in the last three years tank an entire province. What a brilliant way to decrease revenue. It’ll be a buyers market with no one buying.

#77 45north on 12.12.13 at 12:34 am

People have made a mighty gamble. That they could buy what they cannot actually afford. That rising prices (like Remax says) would make it all okay. And that they’re smarter than everyone else.

they have made a mighty gamble and it looks like somebody’s taking the other side:

Everybody knows interest rates will eventually normalize, and while Massachusetts homeowners are safely ensconced in their lifetime loans, people in Calgary and Etobicoke will be wondering what hit them upon renewal.

I made a list of posters who said that the US will not allow interest rates to rise and gave reasons:

ritchie, heineken, smoking man, pinstripe, retired boomer, strawman and bob

well except for “retired boomer” they are Canadians. What’s wrong with this picture? Canadians explaining US monetary and fiscal policy. It’s sort of like the workings of the interior of the sun – I don’t go there. I mean the sun’s polarity is supposed to reverse pretty soon – how would I know? Yet somehow I get the sense that interest rates are about to go up. Thus Garth’s visitor on the 53 floor.

but quite apart from Garth’s visitor, the banks have the other side. Read the mortgage document. It favours the banks. And not just a little bit.

#78 TheCatFoodLady on 12.12.13 at 12:53 am

Stuck in smaller & smaller condos? Have to downsize & not ready to let go? Self-storage being touted as a solution – interesting article:

http://business.financialpost.com/2013/12/07/a-new-twist-on-the-rent-vs-buy-debate-a-smaller-home-and-a-rental-storage-unit/

From the local trenches…

Some property dogs that have been on the market forever have finally sold – pretty steep price reductions & only 2 have sold. A ton more For Sale signs were simply quietly taken down.

Interestingly, rentals aren’t doing that well either right now. Granted it’s a lousy time to move but our REIT is now listing properties here in town as having price reductions – I’ve never seen that before. Other places – haven’t checked on ‘sale prices’ but I know there’s very little interest being displayed even for the spring moving season. Perhaps many are learning that it can be cheaper to suck up current rent than it is to chase after a $50-100/month reduction. |By the time you pay moving costs & associated expenses, it can several years to recoup that loss.

The work world – my construction buddies are sporting long faces – more days at home, fewer jobs to bid on & razor thin margins. Local nail salons, tattoo parlours, all the really, really optional spending establishments – dead. The mall is busy but more looking than buying right now. More people, especially those with older or no kids at hoe, are prepared to wait for Boxing Week sales. And our employment rate, (Kingston ON), is actually up a bit. But then again, so are a lot of costs.

I grocery shop at a discount grocer & there are some GOOD prices available – an increased number of items on sale weekly & I’m happily stocking up on a lot of staples & other items that will keep. I’ve been allergic to full prices on anything for a long time.

I can’t help feeling for those communities who have suffered or are about to, significant job losses.

Can’t predict the future although it seems a bit grim for too many right now. I’m not a gambler by nature – not with my own future, fiscal well being. It can suck a little at times but I plan to keep on underspending & putting to good use that old saying:

‘Use it up, wear it out, make it do or do without.’

Luckily we don’t have to ‘do without’ anything needed & we can certainly enjoy some wants too.

Could be a whole lot worse.

#79 Boomer21 on 12.12.13 at 12:58 am

#65 Basil Fawlty, I don’t think any postal worker would have been surprised by the announcement today. Almost all of the downsizing will come from attrition, ie: retirements over the next 5 years. No one is losing their job 2 weeks before Christmas. In my condo building there was a time CP delivered to your condo door, all 148 doors, now we have a “community” mailbox in the lobby. Seniors who live in condos or retirement homes also have “community” mailboxes. Rural areas will still receive mail as usual. Kellogg is another story, they will be out of work quickly so I feel for them and RIM, ENCANA etc, etc. they do not have the luxury of a “secure union job for life” like Canada Post.

#80 Andrew Woburn on 12.12.13 at 1:12 am

#44 Devore on 12.11.13 at 10:45 pm

It’s been a well known fact for a while now that the bottom 50% Americans pay no net federal taxes.
===================================

This is true but most pay state taxes and some pay municipal taxes as well. They all pay payroll taxes which are substantial and they pay their own expensive medical plans. The coverage of Romney’s “47%” remark made it sound like they were getting a free ride.

Come to think of it, can you imagine what Canadian house prices would look like if we had a US-style mortgage interest deduction here?

#81 screwed on 12.12.13 at 1:26 am

Nevermind mortgages. That’s all bad news. Has anyone checked finance offers on new cars lately? Between 4 and 6 percent on new trucks? Yeah that will move cars off the lots. Until recently it seemed they were literally giving new vehicles away.

Prices up. Rates up. Incomes down. Have a nice life if you can still afford to participate.

It’s all downhill from here and if you can, move. It was good while it lasted.

#82 saskatoonrealty.com on 12.12.13 at 1:37 am

While the number of listings sits a lot higher in Saskatoon now than it did over the past few years, our average selling price and number of sales continues to increase year-over-year for the most part.

The market has certainly cooled off a bit, but it’s far from over, in my opinion.

#83 Cici on 12.12.13 at 1:42 am

I’m not too worried about Jim, after all he’s an educated professional with marketable skills. He’ll be able to pull through and weather the storm. And, while he did take some risks, I believe they were still pretty modest risks. A high-wage financial-sector earner taking on a $200,000 mortgage debt worries me a lot less than all of the low- to middle-income earners who are piling on massive debts to the tune of half a mill and beyond.

If Jim is in trouble, some two thirds of this nation may be up shit creek :-(

Anyways, my thoughts go out to Jim tonight. Don’t worry Jim, you’ll probably get yourself out of this mess in due course, and if you are worried about the job-security issue, make sure you’ve got sufficient insurance and keep networking, just in case.

#84 raider on 12.12.13 at 1:50 am

@#4 add Cominar (TSX:CUF.UN), Dundee Industrial (TSE:DIR.UN) and for the love of risk Dundee International (TSE:DI.UN) to the list. They are in very jucy territory. The international one is a bit of a gamble, since they more or less only rent to “Deutsche Post” in Germany.

I would be cautious about Northern Properties. In addition to being interest-rate sensitive, they are also highly correlated with resource prices since their target market is a not very diversified… also “just” 6% yield doesn’t turn everyone on.

#85 Shawn on 12.12.13 at 1:52 am

PENSION MISCONCEPTIONS ABOUND

Ilovecharts at 63 asks:

Aren’t most pension plans ponzi schemes that rely on constantly increasing company sizes?

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

That’s a common misconception, but no.

In fact pensions are targeted to have each age cohort cover its own costs.

More people coming into the plan makes it easier to deal with risk but if a pension earns the target return, there is no inter-generational transfer intended.

Right now intergenerational transfer is happening due to unexpected low returns but that is not a normal feature of most pension plans.

I predict 2014 will be the year that we start to see a lot of talk about reduced pension deficits. Markets have done very well in 2013 and interest rates are up a bit. This, combined with massive contribution increases of recent years, will significantly cut the pension deficits.

You heard it here first.

#86 ThatOneGuy on 12.12.13 at 1:54 am

@ILoveCharts

>”If companies try to avoid every religious holiday by a month, they will have a very short window in which they can do anything!”

No, not do “anything”, we’re talking about mass firings. And who said anything about ALL religious holidays? We’re talking about Christmas/New Years, you know, that ONE time of the year that’s kind of special for everybody, regardless of religion.

>”Besides, if you are going to lose your job wouldn’t you rather know that before you go into the holidays so that you can make your spending decisions accordingly?”

I don’t know about you but finding out just before the Christmas holidays would spoil them completely. For me, it would be just about the worst time possible to find out I’m fired. I get your pragmatism, but psychologically it’s a very bad time.

>”And finally, a CEO doesn’t want to carry around the emotional burden of that secret during his holidays. It’s nice to get that stuff off his chest so he can enjoy his vacation.”

Ah, so NOW you stopped being pragmatic and started caring about someone’s emotional well being. I don’t share your concern about CEOs. I don’t think it’s nice to make thousands suffer more than necessary so he can “get that stuff of his chest” and “enjoy his vacation”. What values do you have? I don’t know anybody like you in real life.

#87 Regretful on 12.12.13 at 2:32 am

If prices drop 50% on the West Side of Vancouver to 1.1 million will that make Real Estate affordable based on incomes. The article is not grounded in reality.Just curious Garth at what price point will you fold and admit offshore money from around the world, not just Asia has an influence on price. When the average price on the West Side hits 2.5 million will this still be first time buyers moving the market or is 3 or 4 million more to your liking? How do so called locals afford these prices based on incomes? Double bourbon on tap. I missed out big time. Renting and waiting for Godot

#88 Smartalox on 12.12.13 at 2:45 am

@ #65:

Canada Post announced its layoffs this morning because the federal Parliament left for the holidays last night. Suddenly, nobody in the Government was available to answer questions about the decision, or about how the public mail service has been mismanaged over the past 6 years. Still, an interesting about-face for Canada post – didn’t they just launch a glitzy new ad campaign touting their services in time for Christmas?

As for Kellogg’s, probably just because it was 2 weeks ahead of Christmas eve, and the powers that be decided to give notice in lieu of severance. They probably had lots of contract, casual and temporary workers.

#89 Freedom First on 12.12.13 at 3:11 am

#70 Smoking Man

I hear you, and you are correct. The “zillionaires” as you call them, have usually needed many attempts to finally make it. However, SM, the # who never make it is astronomical compared to the # who do. Also, SM, after years of reading Garth’s free blog, surely you have learned that people who go all in on any 1 thing are insane. And, SM, no bull in what I said, that is your job, as you are the famous “Smoking Man”, the best self-proclaimed liar in the world”. SM, never change, I do like your candid air in this now emasculated world. I know I am glad I kept my balls.

#90 Waterloo Resident on 12.12.13 at 3:46 am

To get an understanding of why the FEDERAL RESERVE has to be abolished and gotten rid of, or else America is utterly doomed, then watch this video, it explains everything in as simple a way as possible, yet does a very good job of it:

How the Rothschilds rule USA ?

http://www.youtube.com/watch?v=hE5Sw8qJ-g0

#91 Observer on 12.12.13 at 4:30 am

That right real estate pumpers. Lets get rid of all our manufacturing industry, or industry as a whole. And tons of jobs and go all out building real estate and selling real estate.

Make sure we keep on pumping the prices up so no industry will be able to afford rent.

We can all live large on social security check printed out of thin air because there will no longer be any working tax payers left.

Of course we can tax the sh%%T out of foreigners who buy real estate here. Since the are gazillion airs and can pay a billion dollars each to support our health and social progrmas

#92 Buy? Curious? on 12.12.13 at 5:46 am

Now is the time to panic! Call centres, corn flakes makers, postmen and women are all being laid off! A thousands jobs here, a thousands there, all disappearing! What’s worse there’s a genarational tsunami of people that are going to be in need of health and services for the next 30 years that will crush the majority of people! I’m scared, Garth. I’ve literally just pooped my pants but my new oatmeal diet in protest of Kellogg’s firing of its employees may have something to do with it. I’m still scared though.

Does anybody have a solution to this crisis? Everybody complains about Harper and his conservatives (He’s actually a nice guy and knows alot about hockey) but it’s too late for that. We need a leader! And that leader can only be……Rob Ford!

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

Rob Ford 2014! Smoking Man for Minister of Education! Beach Girl Minister of Being Sexy!

#93 johnny d on 12.12.13 at 6:55 am

@ #82

Sorry but your name takes any credibility away from what you said. Try your sales pitch elsewhere.

#94 Or best offer on 12.12.13 at 8:23 am

The federal government is taking away a public service and we aren’t fighting for it….crazy.

#95 Smoking Man on 12.12.13 at 8:44 am

Best Smoking Man maneuver of the year goes to:

Asking for forgiveness, the man accused of faking deaf sign interpretation at Nelson Mandela’s memorial service says he saw “angels” whilst on stage

Thamsanqa Jantjie said that he began hallucinating whilst interpreting at the Nelson Mandela memorial, saying that he saw “angels”.

He added that he was once hospitalised in a mental health facility for more than one year and claimed he suffered a schizophrenic episode on stage that left him unable to do his job properly

Mr Jantjie, who stood gesticulating feet away from US President Obama and others who spoke at Tuesday’s ceremony that was broadcast around the world, insisted that he was doing proper sign-language interpretation of the speeches of world leaders.

“What happened that day, I see angels come to the stadium … I start realising that the problem is here. And the problem, I don’t know the attack of this problem, how will it come. Sometimes I get violent on that place. Sometimes I will see things chasing me,” Mr Jantjie said.

#96 Condo Minion on 12.12.13 at 9:09 am

You gotta love this evisceration of right wing loon and convicted criminal Conrad Black last night:

http://www.cbc.ca/asithappens/features/2013/12/11/conrad-black-defends-his-interview-with-toronto-mayor-rob-ford/

Come to think of it, the seemingly low IQ Black, with his straw man defenses, circular reasoning, evasive buck-passing and personal attacks, is kind of like smoking man. With a thesaurus and spell check.

#97 Herb on 12.12.13 at 9:12 am

Smoking Man,

I’ve been trying to follow in the footsteps of your genius, but I can’t figure out how the Ontario Liberals managed to screw up Canada Post. Oh, wait … it’s a Crown Corporation responsible to the Federal Government, which is owned by the Conservatives.

So how do opposite ends of the ideological spectrum achieve the same results?

#98 Toronto_CA on 12.12.13 at 9:19 am

“#85 Shawn on 12.12.13 at 1:52 am
Right now intergenerational transfer is happening due to unexpected low returns but that is not a normal feature of most pension plans.”

Wow, for someone who is trying to correct misconceptions you have made a whopper of one here. What low returns are you talking about? All the pension plans I know are making out very well, you do know there is a massive equity bull run right now? Sure newly issued bonds have low coupon rates but pension plans have a mixture of bond durations and the equity returns have more than made up for the low yields of recent purchases.

It’s not the returns, it’s that low interest rates are not allowing for discounting of future liabilities; and new accounting rules for matching the rate of return on plan assets to the rate of discount on liabilities aren’t helping the balance sheets of companies with DB plans, either.

Otherwise, yes, you’re right.

#99 Steve on 12.12.13 at 9:35 am

#94 Or best offer on 12.12.13 at 8:23 am
The federal government is taking away a public service and we aren’t fighting for it….crazy.
_____________________________________________

You are referring to Canada Post?

Who pays for the mail service?
Who pays for any losses?
Is the mail service provided consistent with the cost paid?
If adequate service can be provided for less cost, is that better?
If the fee charged for the service is increased to overcome any losses, is that better?

Sadly, there are some people who will be disadvantaged by change, but breaking out of the denial that has kept Canada Post in a loss position (the losses covered by taxpayers) is a good step. Whether or not good decisions are made from here forward is another matter altogether.

This is not unlike Jim’s situation. Following a paradigm where you pay for anything and everything that your cash flow can support, will end you up where Jim is – negative net worth, perhaps on the verge of bankruptcy. There is a certain level of denial that leads people to and keeps them in this state.

A new paradigm is needed, where both cash flow AND net worth are considered when making financial decisions. That is best combined with a healthy dose of responsibility. Garth regularly argues that RE is a poor (net worth) decision these days, regardless of how easy it is to commit all your cash to it. Much is said about F making it far too easy for us to make those cash flow only decisons. In the end, we are responsible for our own decisions and their outcomes. Not F, not Mom or Dad once we are adults, not our MIL or BIL, not Garth, just each of us.

TO JIM: Take a look at your situation and project your net worth out for several years. Then look at alternatives (sell condo and rent, get a room mate, whatever it takes) until you find options to climb out of your crippling debt. If you continue just looking at cash flow and ignoring net worth, it will not end well.

#100 };-) aka DA on 12.12.13 at 9:50 am

Skyrocketing rents hit ‘crisis’ levels

Of course it is no different here.

Clearly housing affordability remains an issue. For that to change prices must come down or rents must increase… or the social acceptance of the current high housing prices and low cap. rates. Probably a mix of the three. No matter how you slice it someone gets burnt.

#101 crowdedelevatorfartz on 12.12.13 at 9:54 am

@ #11 pounding sand in peachland

Twitter is fun?

#102 Shawn on 12.12.13 at 9:55 am

JAPAN – Not A Freak Show

For 20 years the financial news has pointed to Japan with horror due its huge and persistent stock market crash from its 1989 highs. And its huge property market crash. And lack of GDP growth.

But wait someone posted here that its unemployment is under 5%.

So let’s see people have jobs and stable prices and can borrow at super low rates. And we FEAR this happening here?

It’s stock market was trading at over 50 times earnings in 1989. People made huge fortunes in stocks and then lost it. Tough. The last in got hurt. Hope they learned a lesson. same applies to house prices.

I’m starting to fail to see the big problem in Japan. If you go there I am pretty sure you will see a place of prosperity.

Growth is over-rated. It’s also unsustainable. At 3% GDP the economy doubles in real terms every 23 years. Does anyone really think that’s sustainable? Let’s see double in 23 years, quadruple in 46 years and the economy needs to be eight time s bigger in REAL terms in 92 years. Yeah it happened during the 1800’s and 1900’s. But it is not sustainable. Nor do we need it to be prosperous.

The consensus view is OFTEN wrong.

#103 Not 1st on 12.12.13 at 10:06 am

#94 Or best offer on 12.12.13 at 8:23 am
The federal government is taking away a public service and we aren’t fighting for it….crazy.
——

Hardly an essential service. All I get in the mail is bills and flyers anyway.

#104 John on 12.12.13 at 10:07 am

71 Paul on 12.12.13 at 12:08 am

#65 Basil Fawlty on 12.11.13 at 11:45 pm
Is there any particular reason that companies like Kellogs and Canada Post announce impending massive downsizing two weeks before Christmas, or am I just old fashioned?

Don’t worry about Canada Post. This is Harper’s doing and he’s now toast. Just watch

*********************************************
Harper’s doing you are joking right?

Not the unions not the electronic age, not the internet, not the cost of a stamp, not people have stopped send greeting card of most sorts, not FedEx, not Purolator,

Oh no its Harper please if you are going to slag the man at least choose something that makes sense!

#105 recharts on 12.12.13 at 10:14 am

Allison Lampert ‏@RealDealMtl

Vacancy rate for rented Toronto condos = 1.8% in Oct. 2013 – up from 1.2% in 2012 – as supply of units grew “faster than demand”: CMHC

#106 Steven on 12.12.13 at 10:37 am

A nation that through its insatiable greed and moral ignorance reduces its people to this is truly lost.

http://www.zerohedge.com/news/2013-12-12/living-steel-box-londoners-live-shipping-containers-due-soaring-rents

#107 Louis on 12.12.13 at 10:38 am

Not sure I understand… he has 130k$ dept + 145k$ left on the mortage ?

If that’s soo the biggest problem is not buying the condo, it’s getting 130k in dept.

He bought the condo 150k$ in 2009 and only paid back 5k$ capital in 4 years ?

Heck even with zero cash and 5% rate, a 150k mortage is less than 1k$/month so unless you have monstrous condo fee, you can even pull this off with a full time Mcjob.

He lost his job and took a year to find another one but he should have gotten unemployment insurance during most part of that year.

Did he try to use his condo as an ATM to pay for lifestyle choice that he couldn’t afford ? You can’t blame 150k$ condo losing 25% of it value over 4 year for behing 130k$ in the red.

#108 heineken on 12.12.13 at 10:44 am

#18 tigerbaby on 12.11.13 at 9:23 pm
> I have children who are 27 and 26 yrs old and I do not see them being able to afford the same standard of living that I do.
back a few decades, a high school diploma in NA put you at ~ 90th percentile in world population. the same put you at ~ 50th percentile today. the standard of living adjust accordingly.
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
Another example of the modern Canadian/American dream: its called SURVIVAL.
#22 Shawn on 12.11.13 at 9:25 pm
Gettin’ Rich for Nothing
Speaking of getting rich by selling each other our houses at ever higher prices…
Same applies for Gold, rare stamps, rare coins, collectibles of any kind, paintings.
It does boggle the mind that a such items can fetch higher and higher prices… No value added. Just buy, store and sell later for a higher price.
It works great, until it stops working.
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
Are you confused? Or just making observations?
Another example of the money shift from financial assests (rrsps, reits, bonds, stocks, gics, etf’s—anything related to paper )to hard assets. Im looking at purchasing a classic 1969 camaro Z28 or a modern Porsche boxster spyder. Just watch these things go to the moon when the inflation really takes off.
32 X on 12.11.13 at 9:56 pm
Such a shame that RE ‘experts’ can provide such an opinion to the unknowing, all the while lining their own pockets, without warning, repercussion or penalty.
The system is failing us in this regard
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
Oh please, get over it. Your not going to hit a sympathy nerve.
The gov’t is the real mafia.

43 Tri-Guy on 12.11.13 at 10:38 pm
Wont somebody please think of the mailmen.
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
Hooray, now my kids wont have to shovel the sidewalks for these guys.
I wonder if the gov’t will reimburse me for my new mail box?

#50 Catalyst on 12.11.13 at 11:01 pm
In other news, the guys at ontario power are giving each other 390K moving expenses and 150% base pay bonuses, and 62% of employees make over 100K. Clearly I can’t afford real estate because I don’t work for government.
Can you hook a brother up Garth?
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
Join the local freemasonic lodge. From there you will be able to have a chose of different gov’t employers ie; fire dept, school boards, city hall’s , opg or hydro on; apparently even ford is top heaven. Selling your soul. There is a price , you will have to give up your family life!

52 nonplused on 12.11.13 at 11:05 pm
#16 east vanner
Get yourself a Geiger counter and stick it in the water out there. Nobody is going to be moving to the coast a few years from now.
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
Don’t forget your potassium iodide pills!
#76 Tony on 12.12.13 at 12:33 am
Calgary and all of Alberta’s real estate will crumble in price as oil falls and property tax hikes of around 22 percent in the last three years tank an entire province. What a brilliant way to decrease revenue. It’ll be a buyers market with no one buying
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$
You are such a big dreamer. Let me know and i will send you a job application for Yuk Yuks. I think you will do well in this field.

And 1 last thing. Remember a few years ago when our beloved mayor david miller put the city on strike during 8-10 weeks in the middle of summer. It smelled like shit and waste everywhere. Rats and more rats everywhere. The city didn’t have enough parks to fill with garbage( but not in forest hill or rosedale) Then at the end of the strike, he ALLOWS his unionized workers and managers to work unlimited overtime to CLEAN up the city. Does anybody remember what the budget was for this cleanup??google it you will be surprised. Well all the workers were at triple time and those lazy, pass- me- a- Kleenex whiner managers (sitting in their ford 250’s burning gas) were raping the city coffers.
Thank god we have Rob Ford.
Everyone has skeletons in their closests!

#109 cjlizzard on 12.12.13 at 10:47 am

http://calgaryrealestatereview.com/2013/12/10/canadas-housing-bubble-blogs-burst/

for some reason this is the only one that has survived…must be the pictures

#110 WesternThinking on 12.12.13 at 11:24 am

#65 Basil Fawlty on 12.11.13 at 11:45 pm
Is there any particular reason that companies like Kellogs and Canada Post announce impending massive downsizing two weeks before Christmas, or am I just old fashioned?

The REAL reason is because they can book it as a one time loss in 2013 and not have to look at it ever again.

Similar to the fact that almost all plants start up in December, prove they are ‘operational’ and then shut down. By doing so they gain 6 months of tax offsetting depreciation by being operational for less than 1 month.

Tax and earnings are the real reason it’s at the end of the year.

#111 sciencemonkey on 12.12.13 at 11:25 am

Smoking Man, I’m a wage slave that does R&D for new products for my company to sell. Am I revenue-generating or overhead? My work directly leads to more revenue for the company, but I am treated like overhead. Perhaps sales are the only workers considered to be true revenue-generators?

#112 Gypsykid on 12.12.13 at 11:37 am

Blog dogs, what are you all investing in these days??
Garth?
Lets talk more investing, less real estate. We all know the state that’s in…
I have cash sitting in my accounts and am a little worried these days. Any thoughts? U.S.? Isnt it too high now? Canada? Too volatile??

#113 heineken on 12.12.13 at 11:41 am

Some interesting observations:

The social engineers have done a great job. Take a look. One is in Canada (Vancouver).

http://seattle.cbslocal.com/2013/12/11/grocery-store-kicks-two-girls-off-property-for-singing-christmas-carols/
http://www.truthrevolt.org/news/espn-drops-christmas-ad-referencing-god-and-jesus

This one is for smoking man!!!

http://www.cnn.com/2013/12/12/us/six-year-old-kissing-girl-suspension/index.html

Looks like i will be vacationing in ny more often.

http://newyork.cbslocal.com/2013/12/11/nys-lawmakers-roll-out-measure-to-tax-legalize-marijuana/

Soon the headlines will read “Canadian” instead of Greek.

http://ca.news.yahoo.com/greek-central-bank-head-sees-084309451.html

Great shots of that anti-Christ Obama trying to get lucky with Danish pm while his wife gets pissed off.

http://nypost.com/2013/12/12/obamas-flirt-with-danish-prime-minister-is-a-disgrace/

#114 bentoverandpayingmytaxes on 12.12.13 at 11:50 am

If Jim is an educated expert at something…and out of work…..he is also a dinosaur whose skill set has no value to the rest of the world. I posted a blurb about the brain drain to places like Texas and why its happening but that was deleted…for reasons that only make sense to Garth. Truth is not always popular.

Let me tell Jim why there are so many jobs in Texas …for example….and its not what you think. A couple of months ago the worlds largest technical manpower company Infosys…got caught fudging its US immigration aplications for IT workers…en masse. They had 174,000 IT workers from India working without proper documentation…..the guys/gals were telling the immi guys they were in the US to attend conferances and the like when they were really working….They should have had HB visas but didn’t….costly and hard to get in a timely fashion. Well…the ranks of every large company was suddenly hollowed out…..leaving TN visa’s up for grabs and the holders suddenly in great demand…they can’t get enough Canadians to fill all the posts left vacant by the outpouring of Indian nationals.

If you haven’t been headhunted by every HR hound on the planet by now……you’re probably deserving of unemployment…or government work.

Oh…and by the way…people who do come across saying its for ‘conferances’…and the like…..get caught and you’ll be banned from entering the US for up to twenty years. If you’re employer suggests that you fudge your crossing motives….think twice about your next career move.

#115 Blacksheep on 12.12.13 at 11:51 am

“Smoking Man,

I’ve been trying to follow in the footsteps of your genius, but I can’t figure out how the Ontario Liberals managed to screw up Canada Post. Oh, wait … it’s a Crown Corporation responsible to the Federal Government, which is owned by the Conservatives.”

“So how do opposite ends of the ideological spectrum achieve the same results?”
———————————————-
Herb, this is easily explained. I ‘chirped’ Smoking Man with this recently, but he ‘missed’ it. Here’s a repost just for him.
———————————————-
SM,
Your USC collector thingy is giving you bad Intel again.

Your (and others) getting sucked in with this whole left / right / other / distraction.
I mean you gotta know, the ornament on the hood may change every few years, but the fundamental direction of the vehicle (dictated by the ‘system’) remains the same.
We will get: National carbon taxes, when the Cattle have been sufficiently marinated, with the appropriate propaganda, regardless of the leanings of whomever is in power.
Do you NOT believe this long planned ‘Green Taxation’ will be applied to all first world nations? No hablo, central banking? You can run, but you can’t hide.

To escape one tax farm, you must enter another.

#116 ozy - Jim, stay if rental is more expensive, sell if not on 12.12.13 at 12:25 pm

Jim, stay if rental is more expensive, sell if not

put it on paper
Jim1- mortgage, property taxes, insurance, maintenance fees (strata) etc

Jim 2- rental of same unit in same building from an owner

then u decide which one u want to be

#117 Ralph Cramdown on 12.12.13 at 12:48 pm

SHAWN, what happened to you? Your comments used to be so informative and sensible, now we get two clangers in one day?

You can’t analyze corporate pensions from the point of view that “if they were fully funded and the discount rates were appropriate.” They aren’t, and they aren’t. I’m surprised you’d take this position, because Uncle Warren has written a lot about private pension funds, and I think he’s right. Running unfunded DB pensions and treating pensioners as unsecured creditors (behind BK trustees and DIP financiers, e.g.g) is one of capitalism’s grossest failures in my opinion. Switching to DC and allowing amateurs to get raped by fees isn’t helping.

Japan’s not so bad? Same problem as an unfunded pension plan/unrealistic discount rate with layoffs (i.e. decreasing workforce participation rate and birthrate), but on a national scale. Acres of blue tarps sheltering homeless men who weren’t willing to commit suicide, camped next to the cemeteries full of those who were.

I understand a Malthusian outlook on growth when it meant ever-longer cars built of heavier steel driven by engines with more cubic inches consuming more petroleum. We’re now in an era where a greater percentage of GDP goes to art, services, experiences and entertainment. Building apps for tiny smartphones looks a lot more sustainable than building gas-guzzling rustbuckets.

#118 TEMPLE on 12.12.13 at 12:58 pm

#6 Babblemaster on 12.11.13 at 8:49 pm

As stupidly rosy as Remax’s predictions have been, the fact is they’ve been turned out to be right for quite a number of years running now.

I see this kind of comment popping up here quite often and it’s faulty logic. Remax hasn’t been right at all. Markets have moved higher but it is impossible to prove that any of the ridiculous explanations/predictions provided by Remax are correct. Remax offers mostly untestable hypotheses that, by chance, correlate to a fluffy market. Remax likes to imply causation, but Remax is really only “right” until it is not. The same sort of useless commentary is all over the place in stock market reporting.

TEMPLE

#119 TEMPLE on 12.12.13 at 1:04 pm

#103 Not 1st on 12.12.13 at 10:06 am

Hardly an essential service. All I get in the mail is bills and flyers anyway.

I know, right? If only those damn bills weren’t delivered, we wouldn’t have to pay them.

Anyhow, I like your approach of extrapolating your personal experience to an overall evaluation of what makes an essential service. I feel the same way about healthcare. I’m super-healthy so it is pretty clear to me that the healthcare system is not essential.

TEMPLE

#120 ILoveCharts on 12.12.13 at 1:07 pm

@86 ThatOneGuy:
says:

“Ah, so NOW you stopped being pragmatic and started caring about someone’s emotional well being. I don’t share your concern about CEOs. I don’t think it’s nice to make thousands suffer more than necessary so he can “get that stuff of his chest” and “enjoy his vacation”. What values do you have? I don’t know anybody like you in real life.”

I was exercising sarcasm.

#121 60% Overvalued ??? on 12.12.13 at 1:09 pm

Wow….a bit of a stretch but tells you what the world thinks of us…

http://www.canadianrealestatemagazine.ca/news/item/1827-report-canadian-real-estate-60-overvalued

#122 Canadian Watchdog on 12.12.13 at 1:16 pm

Years of Minimum Wage Labour To Purchase Average Home In Canada – Chart

#123 Mixed Bag on 12.12.13 at 1:17 pm

#44 Devore on 12.11.13 at 10:45 pm

It’s been a well known fact for a while now that the bottom 50% Americans pay no net federal taxes.

—————–

Sure they do, they pay plenty. They buy lottery tickets in the $ Billions, which appears to contribute greatly to the school system down there, sometimes more than the federal contribution.

http://www.cpjustice.org/stories/storyReader$912
(Old article, has anything changed?)

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

Similarly, OLG contributes a few $ billion to OHIP. Although the poorer may officially pay less in taxes, they are in actuality paying more than they are given credit for.

#124 Spank You very much on 12.12.13 at 1:28 pm

DELETED.

#125 not 1st on 12.12.13 at 2:09 pm

#118 TEMPLE on 12.12.13 at 1:04 pm

Anyhow, I like your approach of extrapolating your personal experience to an overall evaluation of what makes an essential service.

You must have been spoiled where you live because out west most cities haven’t had home delivery in a long time and they seem to have managed. In the rural, people have to drive 15 minutes to the post office in town to get the mail.

What are you getting in the mail that is so important it has to be immediately hand delivered to you at a net loss to Canadian tax payers?

#126 Ret on 12.12.13 at 2:16 pm

Re: #110

“Is there any particular reason that companies like Kellogs and Canada Post announce impending massive downsizing two weeks before Christmas, or am I just old fashioned?”

From our Ontario Liberal appointees on Metrolinx,

http://toronto.ctvnews.ca/panel-recommends-up-to-10-cents-per-litre-gas-tax-to-help-fund-public-transit-1.1586383

How about asking the people who use the service to fully pay for it? That would be a new concept worth exploring.

The wind turbine hugging, car hating Fiberals are at it again. Maybe a Liars Tax at Queen’s Park would generate more $. They have never met a tax that they didn’t like. The new Pinocchio tax!

#127 Smoking Man on 12.12.13 at 2:36 pm

#97 Herb on 12.12.13 at 9:12 am

Should have been a bit more specific, forgot lots of 2 dementional thinkers here.

Kellogg paid taxes, they are gone that’s BAD

Canada Post consumed taxes they are cutting that’s GOOD

Concervatives are GOOD
Liberals are BAD

#128 broadway skytrain on 12.12.13 at 2:42 pm

comparisons to many other world markets are simply not realistic. In my hood of Rosedale-Moore Park, for example, one of the wealthiest neighbourhoods in Canada, average detached house sales were $1.175 million in 2012. Let’s look at Kensington & Chelsea in London. The average semi-detached price is $8.15 million.

Median household income in Kensington & Chelsea? About $190k. In Rosedale-Moore Park? $175k.

What about the Upper East Side? Average home price is just under $2 million. Median income is $83k.

The income numbers are quite misleading.
————————————–

The qualification was clearly stated – expensive relative to rents and incomes. In other words, local delusion. Thanks for illustrating. — Garth
————————–
but delusion is what drives the upper end of most all personal product markets, it seems. walking at burrard and robson last night i thought i was on rodeo drive, there seems to be an abundance of folks willing to spend 10-100x the costco price for any particular item.

the westside and other premium areas are where the asset rich like to live. ASSET rich means income is irrelevant. if you were left 50m from grandad, you can buy a 10m house and pay for a family with zero lifetime income.

i have never been to kensington in london but i’d bet it’s full of asset rich folks too.

they can have their corporations pay them whatever they want and they dont need to rent out the basement. but here’s a premium smallish house for rent in for 25k/mo , heck you can walk to the Royal Van Yacht Club! http://vancouver.en.craigslist.ca/van/apa/4239685333.html
whomever rents it will surely have very low ‘income’ according to the CRA.

#129 Rational Optimist on 12.12.13 at 2:47 pm

http://www.cbc.ca/news/canada/edmonton/edmonton-car-dealer-sold-luxury-suv-to-psychiatric-patient-1.2458393

‘Edmonton car dealer sold luxury SUV to psychiatric patient’

I figured someone here would have already posted this: apparently this fellow was on a day pass from a psychiatric hospital, told the dealership that he was a millionaire businessman (as he sometimes has delusions of), and they lent him $60,000 for a brand-new jeep. He told them he would put four thousand down, but didn’t have it all on him, so they figured it would be okay if he paid it later.

My favourite part is that the salesman drove down to the psychiatric ward to pick up the dealer plates, after telling the fellow’s psychologist that the deal would not be called off.

#130 Old Man on 12.12.13 at 3:15 pm

What we are witnessing today is globalization, and Canada is taking a hit as there was a time that the unions decades ago had an agenda for the working class and all was good. No more negotiations, but closures, as the companies going down in Canada are but branch corporations based in USA that can no longer compete with earnings and benefit packages that are too high; not to mention other factors. So this amounts to kicking the unions under the bus, and repatriating business back to USA where workers will work for $13.00 an hour with a limited benefit package to increase capacity of production to import into Canada. Its called fueling the bottom line with profits with a reality check, as there will be no free lunch in Canada anymore.

Now we come to Caesar with the Canada Post scenario, as this too was a move to break the unions. This could have been done a different way, whereby, mail only needs to be home delivered 3 times a week, and all would be well, as know the inside. Lets take city X with a modest population of 25,000 anywhere in Canada, as the mail is sorted; the postman takes a taxi to the box in the neighbourhood; walks two hours in his district door to door; and cells a taxi to take him back somewhere to do what? Well he is a union man with a huge salary and a benefit package with a few hours of work on the job. Hey, I say the party is over; need I say more.

#131 Victoria - the Original on 12.12.13 at 3:32 pm

Thank God.

House prices are going to double in the next 25 years.

http://www.huffingtonpost.ca/2013/12/12/house-prices-canada_n_4434051.html

#132 Ogopogo on 12.12.13 at 3:34 pm

Garth, thou prophet, thou!

Bank of Canada’s Poloz warns of risk of deflation

“Of course, when we are already below target, as we are today, we care more about downside risks than upside ones.”

Someone should tell the roses-and-unicorns realtors that.

#133 Herb on 12.12.13 at 3:38 pm

#126 SM,

that line of “thinking” doesn’t even make it all the way from “A” to “B”. Have you been unhooked from the Universal BS Generator too?

#134 jess on 12.12.13 at 3:45 pm

Chateaubriand says of history:-

“There are,” he says, “two consequences in history; an immediate one, which is instantly recognized, and one in the distance, which is not at first perceived. These consequences often contradict each other; the former are the results of our own limited wisdom, the latter, those of that wisdom which endures. The providential event appears after the human event. God rises up behind men. Deny, if you will, the supreme counsel; disown its action; dispute about words; designate, by the term, force of circumstances, or reason, what the vulgar call Providence; but look to the end of an accomplished fact, and you will see that it has always produced the contrary of what was expected from it, if it was not established at first upon morality and justice.”

– Chateaubriand’s Posthumous Memoirs.
Chateaubriand had originally intended to have the work published at least fifty years after his death, but his financial troubles forced him, in his words,
“to mortgage his tomb.” wiki

our children’s children’s tomb?
budget balance is superstition /an old time religion = samuelson
http://www.youtube.com/watch?v=pCrn4lfwQLc

#135 Old Man on 12.12.13 at 3:46 pm

Now will tell you another story about Ford Canada in Windsor during the 1980’s which involved the union. This will blow you away, as any employee with a minor disability was giving a deal not to make any claim with workers compensation, as the rates would go up. They set up a private club with snacks, tv, and a pool table to check into once a day for full salary and benefits not to work.

#136 Ogopogo on 12.12.13 at 3:49 pm

Say, whatever happened to all the goldbugs that used to infest the blog?

I guess it’s hard to type angry rants when you’re in a Prozac vegetative state? ;-)

#137 Castaway on 12.12.13 at 3:53 pm

#102 Shawn on 12.12.13 at 9:55 am
JAPAN – Not A Freak Show

For 20 years the financial news has pointed to Japan with horror due its huge and persistent stock market crash from its 1989 highs. And its huge property market crash. And lack of GDP growth…………..

Great post Shawn. Finally someone capable of some abstract thought on this site. Last time I looked Japan was still major economy. Canada, not so much!

#138 heineken on 12.12.13 at 4:01 pm

RE 133 Ogopogo on 12.12.13 at 3:49 pm
Say, whatever happened to all the goldbugs that used to infest the blog?

I guess it’s hard to type angry rants when you’re in a Prozac vegetative state? ;-)
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$

I’m STILL buying with both hands.

#139 recharts on 12.12.13 at 4:21 pm

I’m starting to fail to see the big problem in Japan. If you go there I am pretty sure you will see a place of prosperity.

Growth is over-rated. It’s also unsustainable. At 3% GDP the economy doubles in real terms every 23 years. Does anyone really think that’s sustainable? Let’s see double in 23 years, quadruple in 46 years and the economy needs to be eight time s bigger in REAL terms in 92 years. Yeah it happened during the 1800′s and 1900′s. But it is not sustainable. Nor do we need it to be prosperous.

buddy you just whistled in the church !
the preacher that we have here is saying that 8% is normal.
From now on you will have your posts deleted or subject to a two tiers approval.

What you poster at #102 is common sense and I have been calling for that for a long time. There is not 8% return with a global or local economy in the dump.

#140 Rapier Wit on 12.12.13 at 4:22 pm

Garth! Say it isn’t so!!!!

http://business.financialpost.com/2013/12/12/toronto-housing-prices-to-double-over-next-25-years-study-predicts/

Meaningless. — Garth

#141 Nemesis on 12.12.13 at 4:27 pm

TeeHee! SomeDaze, ya gets Nada… and others? Hah! Chock’oBlock with Zen.

Well, maybe not ZenZen [as it were] – but Zen of a sort… like today’s, SaltyDogz.

It’s not often the Telegraph MucksItUpRoyally, especially since Baron Black of Crossharbour took a ‘sabbatical’, but today they really stuck their foot in it, SaltyDogz… Here we go:

[UK Telegraph] – Canada’s politicians think Santa is Canadian. Sorry, buddeh, he’s obviously a Brit

…”Santa is not only British but he’s decent, down-to-Earth British trash. Why? Because he’s chronically obese, only works one day a year, and if he drinks just half the sherry left out for him on a Christmas Eve then he obviously doesn’t think twice about drinking and driving. And if he is British then he probably lives in the Shetlands and comes under the protection of NATO and the Royal Navy’s last remaining armoured pedalo. Debate over. The world’s children can relax.”…

http://blogs.telegraph.co.uk/news/timstanley/100250363/canadias-politicians-think-santa-is-canadian-sorry-buddeh-hes-obviously-a-brit/

…Freakishingly SelfDeprecating… but as it will become abundantly clear by the end of this post, it’s not Santa who’s British…

It’s TheGrinchWotStoleChristmas!:

[UK Independent] – 2.5m people will have to take out a loan just to afford central heating this Christmas

http://www.independent.co.uk/news/uk/home-news/25m-people-will-have-to-take-out-a-loan-just-to-afford-central-heating-this-christmas-8994083.html

… Talk about HardTimes! And they’re the LuckyOnes, as…

[UK Independent] – Housing double whammy: A whole generation ‘won’t be able to buy or rent a home’

…”A generation of Britons faces a housing “double whammy” as a growing number of people cannot afford to buy or rent a home, according to a report published today.

The study warns that house prices are set to rocket by 35 per cent by 2020 and that private sector rents are likely to soar by 39 per cent over the same period. It said that the “two broken housing markets” mean an extra 310 working people a day – one every five minutes – turn to the Government for housing benefit.”…

http://www.independent.co.uk/news/uk/home-news/housing-double-whammy-a-whole-generation-wont-be-able-to-buy-or-rent-a-home-8994229.html

…Oh yes, speaking of GrinchianAusterity, PublicHousing and “We’re All In This Together!” and DoubleWhammys… well, let’s just say that the best HashTag for what follows is, #YouCan’tMakeThisS**tUp:

[UK Independent] – ‘I’m experiencing austerity as well’, says Princess Michael of Kent

…”The Princess, who is an interior designer and author, told The Times in an interview to promote her debut novel: “I am in very austere economic times too, thank you very much!”

“We’ve cut back dramatically. I mean we never go out to dinner unless we go to somebody’s house. We never go to restaurants. That’s too extravagant.”

The Princess, who lives with her husband at Kensington Palace, added: “We invite people here [Kensington Palace]. I cook. Well, if I’m giving a dinner party I get in help.”

She also told the interviewer of her love for budget carrier easyJet saying: “it’s the only direct route to Biarritz.”…

http://www.independent.co.uk/news/uk/home-news/im-experiencing-austerity-as-well-says-princess-michael-of-kent-8993437.html

… TheHorror! FlyingCommercial to Biarritz?… What would the neighbours say? Still, CouldBeWorse….

[UK Telegraph] – Queen angry at police officers eating her Bombay mix, court hears: Royal protection officers were warned to stop eating snacks meant for the Queen according to News of the World memos

…”The Queen was “furious” after royal protection officers helped themselves to Bombay mix and nuts left out for her around Buckingham Palace, a court heard today.

Palace officials sent a memo to royal protection officers warning them to “keep their sticky fingers out”, after Her Majesty noticed the snacks were disappearing, jurors at the Old Bailey were told.

The Queen became so incensed that she even began marking the bowls to check if the levels were dropping, it was suggested.”…

http://www.telegraph.co.uk/news/uknews/phone-hacking/10513920/Queen-angry-at-police-officers-eating-her-Bombay-mix-court-hears.html

The VeryNerve ‘o that RottenLot’oCoppers! Pinching Her Majesty’s Cashews, as it were… Have they NoManners!

One would almost be tempted to think that RoyaltyProtectionBranch had cancelled the HobbyBobbies’ subscription to MarthaStewartLiving!

Oh, wait…

[AdWeek] – Martha Stewart Living Hit By Holiday Layoffs
Up to 100 staffers will be fired, per report By Emma Bazilian

http://www.adweek.com/news/press/martha-stewart-living-hit-holiday-layoffs-154461

[NoteToBillGable: It’s WorseInPrint, you know.]

#142 Shawn on 12.12.13 at 4:35 pm

APPLES AND GROWTH

buddy you just whistled in the church !
the preacher that we have here is saying that 8% is normal.

***************************************
Real GDP at 2% plus inflation at 2% plus dividends at 4% gives 8%.

8% nominal return is not impossible in a 2% real GDP world. GDP does not include inflation or dividends.

#143 Smoking Man on 12.12.13 at 4:56 pm

#111 sciencemonkey on 12.12.13 at 11:25 amSmoking Man, I’m a wage slave that does R&D for new products for my company to sell. Am I revenue-generating or overhead? My work directly leads to more revenue for the company, but I am treated like overhead. Perhaps sales are the only workers considered to be true revenue-generators?

………

Your over head. I’m in the business of creating enhanced productivity tools. If an app save a company 50million it’s not rewarded much, If I was a brain dead monkey sales guy that brought in 50million. I would get a nice chuck of that.

Mind you that’s Canada, in the states they can do math, productivity solutions are rewarded well.

#144 Mike on 12.12.13 at 4:59 pm

#139 Rapier Wit on 12.12.13 at 4:22 pm
Garth! Say it isn’t so!!!!

http://business.financialpost.com/2013/12/12/toronto-housing-prices-to-double-over-next-25-years-study-predicts/

………………………….
Great, that’s it !!! we officially hit the top :)
It uber-bullish predictions like these that always come out at the VERY TOP ! Watch out bellow …

#145 Basil Fawlty on 12.12.13 at 5:03 pm

“Say, whatever happened to all the goldbugs that used to infest the blog?”

Talking about gold gives Garth bunions.

#146 Paul on 12.12.13 at 5:24 pm

144 Basil Fawlty on 12.12.13 at 5:03 pm

“Say, whatever happened to all the goldbugs that used to infest the blog?”

Talking about gold gives Garth bunions.
————————————————————
Wait till inflation really kicks in.
Fixed the power window switch on my car $715
1/2 oz Gold $700 would soon have the gold!

Inflation? You’ll be waiting a long time. Gold is dead money. — Garth

#147 Onthesidelines on 12.12.13 at 5:24 pm

Shawn #102 ” I’m starting to fail to see the big problem in Japan. If you go there I am pretty sure you will see a place of prosperity.”

____________________________________________

And you’d be wrong. I spent a couple decades in Japan going back to the bubble years. The changes, especially from 2004 on, have been brutal. Prosperity is not a word I would use to describe Japan today.

#148 Paul on 12.12.13 at 5:29 pm

#131 Ogopogo on 12.12.13 at 3:34 pm

Garth, thou prophet, thou!

Bank of Canada’s Poloz warns of risk of deflation

“Of course, when we are already below target, as we are today, we care more about downside risks than upside ones.”

Someone should tell the roses-and-unicorns realtors that
———————————————————-
That’s funny we get them going in and going out.
Like mutual fund sellers only it’s your money at risk

#149 jess on 12.12.13 at 5:32 pm

Lurid Subprime Scams Unveiled in Long-Running Fraud Trial
By Matt Taibbi
POSTED: December 12, 4:20 PM ET

Read more: http://www.rollingstone.com/politics/blogs/taibblog/lurid-subprime-scams-unveiled-in-long-running-fraud-trial-20131212#ixzz2nIZgpZ

#150 Paul on 12.12.13 at 5:32 pm

#145 Paul on 12.12.13 at 5:24 pm

144 Basil Fawlty on 12.12.13 at 5:03 pm

“Say, whatever happened to all the goldbugs that used to infest the blog?”

Talking about gold gives Garth bunions.
————————————————————
Wait till inflation really kicks in.
Fixed the power window switch on my car $715
1/2 oz Gold $700 would soon have the gold!

Inflation? You’ll be waiting a long time. Gold is dead money. — Garth
———————————————————-
Personally I hope it is dead money if not there would be big trouble a little is like house or car insurance you don’t want to collect on either

#151 Sleepless in Victoria on 12.12.13 at 5:34 pm

@ #143 Mike

doubling in value over 25 years works out to roughly 2.75% a year, is that uber-bullish now? Sounds more like uber bullsh* to me!

#152 Blacksheep on 12.12.13 at 5:40 pm

“Say, whatever happened to all the goldbugs that used to infest the blog?”
———————————————–
Liquid and lurking in the shadows. Just need some downside momentum and we will see how close we can get to single digit silver : )

#153 rosie "moving forward" in the knowledge that, "this won't end well" on 12.12.13 at 5:55 pm

Interesting interview.

http://www.pbs.org/newshour/businessdesk/2013/12/nobel-laureate-bob-shiller-on.html

#154 recharts on 12.12.13 at 5:59 pm

.

#141 Shawn on 12.12.13 at 4:35 pm
APPLES AND GROWTH

buddy you just whistled in the church !
the preacher that we have here is saying that 8% is normal.

***************************************
Real GDP at 2% plus inflation at 2% plus dividends at 4% gives 8%.

8% nominal return is not impossible in a 2% real GDP world. GDP does not include inflation or dividends

Then the trumpeters should say 4% real return not 8%.

A diversified 60/40 balanced portfolio should be ahead more than 9% this year. — Garth

#155 CJ on 12.12.13 at 6:04 pm

A question for all of you real estate naysayers: what should houses cost in this country?
The fact is my parents’ generation had to scrimp and save to pump money into their mortgage just the same as I’m doing with my family. People complain about high housing prices. But this is supposed to be a 25-year proposition. For some reason, we have become a bunch of whiners. Suck it up, don’t go on 3 vacations a year, don’t eat out five days a week and you will find your mortgage payment isn’t that bad.
Or, don’t do the above, pay exhorbitant rent rates and face higher housing costs in five years.

#156 Babblemaster on 12.12.13 at 6:05 pm

#117 TEMPLE

“I see this kind of comment popping up here quite often and it’s faulty logic. Remax hasn’t been right at all.”

—————————————————

No logic involved. It’s a simple observation. Their prediction, regardless of their faulty, absurd arguments, has turned out to be correct. Grath’s prediction, regardless of the soundness of his arguments, has not. It serves to illustrate that it’s impossible to predict the future.

Untrue, actually. Many housing markets are in decline, or neutral. Mortgage rates have risen, gold cratered, the US economy recovered while ours weakened and a balanced, diversified portfolio has behaved as expected. I think this blog is doing just fine in the prediction dept. — Garth

#157 recharts on 12.12.13 at 6:05 pm

I had no idea that GDP does not include dividends.
In other words you are saying that our GDP can be zero and we can all be rich by investing and have a personal growth of 4%.
If that is not counted in GDP where the heck is that counted. After all we might be seeing some progress but we are obsessed with GDP when in reality the growth that is going to get us out of trouble is somewhere else.
I wonder where would that be and why is not made public since it is to easy to succeed.

#158 Babblemaster on 12.12.13 at 6:09 pm

#117 TEMPLE

Remax likes to imply causation, but Remax is really only “right” until it is not. The same sort of useless commentary is all over the place in stock market reporting.

———————————————————

Talk about a useless commentary, everyone is “right” until they’re not. And you’re right, there is a lot of noise in stock market reporting, and in this blog as well.

Regarding causation, I did not imply it, you inferred it.

#159 Canadian Watchdog on 12.12.13 at 6:14 pm

A diversified 60/40 balanced portfolio should be ahead more than 9% this year. — Garth

That puts the 60/40 investor crowd right about here.

Likely the most meaningless chart you have ever cooked. — Garth

#160 X on 12.12.13 at 6:15 pm

#108 heineken – my point being that were another investment adviser to advise similarily, they would find themselves with legal ramifications for their expert opinion. The RE industry faces no such repercussions.

When most Canadians have most of their net worth in RE, this makes for dangerous self serving advice.

Not looking for any sympathy whatsoever, it would be nice if the RE industry had more oversight or regulation to keep them honest.

#161 Ralph Cramdown on 12.12.13 at 6:30 pm

#145 Paul — “Fixed the power window switch on my car $715”

If you can’t figure out how to fix stuff like that for less than that, having gold isn’t going to save you when the apocalypse comes. You’d be better off investing in a Chilton’s, or a more reliable car. Maybe something with am OM617 under the hood?

#162 willworkforpickles on 12.12.13 at 6:38 pm

All the starry eyed newcomers and even the long time holdouts with dollar signs gleaming in their eyes have a plan – big big plans in fact – right up until the bottom falls out that is……

#163 World Traveller on 12.12.13 at 6:38 pm

#154 CJ on 12.12.13 at 6:04 pm

Sure sure, buy now or be priced out forever.
Your parents generation did not have the CHMC system pumping housing prices to new highs. Who decided that this should be a 25 year proposition? Not the feds, as they had previously allowed 40 year amortizations until they realized their mistake. Unusually low rates have given people the comfort level that they should take 25 years to pay down a mortgage and thanks to high housing costs the chance of paying off a mortgage in 10-15 years is a fairy tale.

#164 Smoking Man on 12.12.13 at 6:43 pm

http://www.zerohedge.com/news/2013-12-12/global-house-price-index-surges-record-high

Hey LaughingCon seams you missed the boat everywhere.

Ha

#165 Shawn on 12.12.13 at 6:51 pm

GDP (Growth Rate) Does not include dividends

Buffett explained years ago how GDP related to a reasonable return expectation.

http://money.cnn.com/magazines/fortune/fortune_archive/1999/11/22/269071/

This is from 1999 when he correctly warnded that return expectations were far too high.

GDP growth is about the real growth of the economy in real dollars before inflation.

Dividends can be produced by the existing level of GDP , we don’t need any growth to sustain dividends we GDP growth to get dividend growth.

A Farm producing 500 bushels per acre does not need growth or productivity improvement to keep dividending out 500 bushels.

A reasonable return expectation over the long run is

GDP growth plus dividends yield plus inflation. So sayeth Buffett.

#166 Nemesis on 12.12.13 at 7:04 pm

#140… Addendum: BonusZen! ItWozTheDukeWonDoneIt!

Egads! How could ‘Nem’ have forgotten?… TheShame!

Your first name doesn’t have to be Sherlock, SaltyDogz to figure out that the only ‘Nutter’ stalking Buckingham’sCorridors was more than likely someone with… how to put this delicately?…

AnAgenda… and a RegalEgo to StokeThatGrudge.

Yes, I’m talking “You”, AirMilesAndy…

BestOfAll, SaltyDogz? We get a RightRoyale Quote ‘O TheDay:

“Do you know who I am!” [Spluttering… as CascadingFlecks of Saliva SpewForth in SlowMo.]

[UK DailyMailOnline] – Don’t you know who I am? Prince Andrew’s blast at armed police who mistook him for an intruder at Buckingham Palace 48 hours after security scare

…”Prince Andrew reacted with fury at gun-wielding officers who mistook him for an intruder at Buckingham Palace and asked him to ‘verify his identity.’

Two heavily-armed policemen confronted him as he walked in broad daylight through the grounds, sources revealed last night.

The fifth-in-line to the throne stood his ground asking the officers ‘Don’t you know who I am?’ and was said to have ‘made his thoughts plain’ during the highly-charged confrontation that followed.

A royal source said: ‘He was incredibly, incredibly angry. It was very much a case of guns being pointed at him and “halt who goes there”.’

Yesterday police issued a humiliating apology to the Duke of York over the extraordinary error.

According to the Daily Mirror, a source said that the Duke was red faced as he shouted at officers like a school teacher.

They said: ‘It got pretty heated because he just kept repeating himself “Don’t you know who I am?”.”….

http://www.dailymail.co.uk/news/article-2415374/Prince-Andrews-rage-Palace-police-Duke-angry-officers-mistook-intruder.html

[NoteToSaltyDogz: Motive? Check. Capability? Check. Opportunity? Check.]

#167 Bottoms_Up on 12.12.13 at 7:08 pm

#156 recharts on 12.12.13 at 6:05 pm
——————————————-
Wouldn’t dividends have already been counted in GDP through company revenues/profits/EBITDA?

#168 Bill Gable on 12.12.13 at 7:43 pm

#16 – EastVaner

“Vancouver is the best place in the world, easy and without question. So no, Vancouver prices will never crash, not in my lifetime”.

> Advice – put down the bong and realize that Vancouver is nothing but a second tier City, at best.

Do you ever pay attention to what Mr. Turner says, or do you sit in your basement suite and think this rainy, backwater is really “heaven”? If you do….I suggest you try travelling and getting an education.

Vancouver retreated 40% in the early 80’s, in a nonce and believe me, what’s coming is going to make that look like a tea party.

D I S A S T E R straight ahead. Oh, wait a second, you probably have trouble understanding economics.

Did you get past grade 6?

#169 aprilNewwest on 12.12.13 at 7:53 pm

#139 – Rapier Wit– “Meaninglesss” Exactly what Garth says.

#170 aprilNewwest on 12.12.13 at 7:56 pm

#130 Victoria – What else do you expect from Helmut Pastrick.

#171 aprilNewwest on 12.12.13 at 8:00 pm

#127 broadway skytrain. The rich have always bought whatever they want. The majority of us are not in that ballpark. Today is no different than it has always been.

#172 wallflower on 12.12.13 at 8:14 pm

“Toronto housing prices to double over next 25 years” study predicts.
Young people are so illiterate, they simply will not understand that this headline is a statement of exceptionally low returns.
Next 25 years = 2X
Last 25 years = 10X
based on my ex neighbourhood
Avenue Road / Wilson area home 1983 to 2013 = 30 years
$132,000 >> $1.6M – which means in 30 years multiple exceeding 12 so estimate 25 years a multiple of 10X

#173 kilby on 12.12.13 at 8:16 pm

#146 Onthesidelines on 12.12.13 at 5:24 pm
Shawn #102 ” I’m starting to fail to see the big problem in Japan. If you go there I am pretty sure you will see a place of prosperity.”

____________________________________________

And you’d be wrong. I spent a couple decades in Japan going back to the bubble years. The changes, especially from 2004 on, have been brutal. Prosperity is not a word I would use to describe Japan today.
*********************************************
The Japanese are pumping 77 billion a month in their “Quantitative Easing” nearly as much as the states, Shinzo Abe’s big gamble

#174 Paul on 12.12.13 at 9:21 pm

#160 Ralph Cramdown on 12.12.13 at 6:30 pm

#145 Paul — “Fixed the power window switch on my car $715″

If you can’t figure out how to fix stuff like that for less than that, having gold isn’t going to save you when the apocalypse comes. You’d be better off investing in a Chilton’s, or a more reliable car. Maybe something with am OM617 under the hood?
———————————————————-
Not everyone drives a Kia or an old bucket of bolts
I’m sure you could have fixed it even thou you don’t have a clue what kind a car I drive lol

#175 Exurban on 12.12.13 at 10:48 pm

#113 heineken

… one is in Canada (Vancouver) …

No. That story is from Vancouver, Washington, where you can buy a SFH for $200k.

#176 Pulp Faction on 12.13.13 at 3:47 am

People have to be allowed to live with decisions they have made. People have to be left to fail.

#177 Waterloo Resident on 12.13.13 at 4:36 am

I’m here trying to figure out how to overthrow the Federal Reserve. My thinking is to help Northern States follow the example of the Bank of North Dakota and help them to create their OWN mini central bank. The next logical steps will be to have South Dakota and Wyoming follow with the ‘Central Bank of South Dakota’ and the ‘Central Bank of Wyoming’. Each year one additional local state will join in and create their own. Once 33% to 50% of the individual States have their own state central bank, then they can work together to create a more powerful Federally controlled BUT 100% publicly owned Federal Central Bank, not the public/private hybrid that now exists and is currently making a select few private individuals insanely rich.

#178 raj on 12.13.13 at 12:22 pm

nowadays media takes no responsibility for accuracy of reporting. atleast media should clearly and visibly mark what was verified and what is just an unverified ad.
prices are falling slowly in Calgary (10-15k on 400k house in last quarter) though it seems to be a result of rise in interest/mortgage rate rather than prudency on part of buyers. most buyers do not read and think, and would buy if they can meet the monthly payment.
sad state of affairs. that is what happens when you build your economy on FIRE rather than on things that really add value.

#179 Still here on 12.13.13 at 2:19 pm

@ Waterloo Resident what would you gain other then crisis after crisis, why do you think the system is the way it is.

As Garth is wont to say, spend less time on those doomer sites and more time learning to invest and budget

PS Garth excited about tomorrows post, been sitting some quite a bit of cash while I weigh various investing options