Let them eat soup

chicken strips modified modified

The average house in Independence costs $85,500, which is 5.4% less than last year. The average house in Brampton costs $441,079, or about 5% more than last year. People who work for the Unilever company in Independence and own a home can lock in their mortgage rate for 30 years, as well as write off mortgage interest and property taxes from their taxable incomes.

That’s why households making an average of $42,000 in the Missouri city can easily afford to buy and carry a house costing two times their annual income. Brampton families, on the other hand (average household income, $98,000), must pay four times earnings for a property, take on substantial debt to do so, face repeated mortgage renewals at uncertain rates, and can deduct no real estate carrying costs.

This leads to an obvious conclusion. People cost less in Independence. They cost more in Brampton. And if you can manufacture soup for the North American market anywhere you want, why locate in a place where workers need to earn double the money?

I’m sure the boys at head office had such thoughts when they announced the Brampton soup mix-making plant there would shutter over the coming months, putting about 300 people out of a job, with the work going to its Missouri facility. “The decision to close the Bramalea plant came after a strategic review of the dry mix category in North America,” said the boss. “As more than 80% of the volume produced at Bramalea is shipped to the United States, Unilever made the strategic decision to make its investment closer to where the bulk of the product is consumed.”

Well, it’s only one dinky factory in an urban sprawl of six million people. And that site will probably make a dandy condo. Just like the Mr. Christie’s cookie factory in Toronto, which closed and put 550 people on street last year, to be briefly considered home to 27 new condo buildings.

In Canada, this is progress. Who needs useless, noisy, downscale factories full of people with rough cuticles and bad tats when all we need is to sell real estate to each other at ever-higher prices with ever-larger mortgages? Then everyone benefits. Obviously we’ve found a new economic reality. It’s so good to be different. And smart.

Well, BMO chief economist Doug Porter has come up with some analysis we should heed. After looking at sucky data on our national trade numbers this week, he plotted exports over a few decades, stripping out the volatile energy sector (it accounts for less than 10% of the economy, anyway). In other words, his work shows what’s happening to manufacturing in Canada. The chart below was in the Financial Post. It’s scary.

TRADE CHART modified

This is what happens when a country allows cheapo interest rates and tax incentives to spawn a real estate-based society where surging prices and record debt render it uncompetitive. There’s twice as much of the Canadian GDP now involved in housing and finance as there is manufacturing – which is steadily shrinking. And while the rest of the world is fighting hard to create value-added jobs and increase exports in the face of waning consumer demand, we’re blissfully creating a condo economy.

Realtors think this is great, of course. They argue on this pathetic blog that sustained low rates and eternal house horniness will means years and decades more of the same. A Vancouver forecasting firm made headlines this week saying houses there will sell for an average of $2 million on the downtrodden east side and $7 million in the west within a decade. Why? Because that’s the trend.

The only thing sadder is that people will believe it. Which may bring more debt and higher values. But already there’s ample evidence consumers are hitting their debt ceilings, as retail sales slump and department stores go on the auction block. So, without enough actual jobs making stuff that we sell to the world, what next?

This is why I worry about you. It can all turn on a dime, as over-bought markets usually do. Without real wage growth and tens of thousands of new jobs month after month, without new investment in plants and equipment, without more exports and earned cash coming into the economy, housing is unsustainable. Mortgage rates can go to zero. It just won’t matter.

After all, look at Europe today. The central bank cut its key rate to 0.15% and will start charging for deposits. Yup, negative interest. Why? Because even with the cheapest money in history, consumers aren’t borrowing, aren’t spending. Deflation’s around the corner. And when that happens, the only happy people are the ones with liquid assets and no debt.

Or those who live in $85,000 houses, with jobs.

234 comments ↓

#1 dienekes on 06.05.14 at 6:37 pm

Dr. Pepper tastes way better in Canada than the US.
Would that account for Canadian housing cost 4 times more than the US?
It’s the only difference I can find.

#2 Steve on 06.05.14 at 6:42 pm

That non energy trade balance is telling. My excellent stewardship of the economy since 2005 has used exports of high-cost oil to balance the deterioration of manufacturing,

I will be remembered as the greatest.

#3 recent canadian on 06.05.14 at 6:42 pm

Garth,
This simple example of the soup factory is exactly what is and will continue to happen when the only reason Canadians cost more to employ is because of house horniness. Coming from NYC to live in Montreal has been a shock and nobody believes me when I tell them the same happened in the USA with housing! I try to tell people to read this blog but they are so in love with house prices that they don’t understand companies will eventually just ship out because of the insane salaries that have to be paid just to sustain housing debt.

#4 Smoking Man on 06.05.14 at 6:42 pm

After all, look at Europe today. The central bank cut its key rate to 0.15% and will start charging for deposits. Yup, negative interest. Why? Because even with the cheapest money in history, consumers aren’t borrowing, aren’t spending. Deflation’s around the corner. And when that happens, the only happy people are the ones with liquid assets and no debt.
………

There is one more trick up the sleve… It’s not talked about….

The last move they have…

Fire up the printing press and give the loot to consumers…

Don’t think it’s posable, take it from an Alien, it is and will happen…

#5 Ken Lovegrove on 06.05.14 at 6:50 pm

Hi.

I’m currently in Lagos, Nigeria. Running a course on shipbuilding and ship repair.

Talking to my colleague here who explained tax rate is 5%. People making big money working offshore. Said very few people ever get mortgages. You rent or save and buy outright with a view to keeping it in the familly.

On the BA flight coming over I was sat in economy. Lovely flight with very nice people. I was staggered at what Nigerians were spending on duty free. 300 pounds here. 500 pounds there.

My colleague explained that a Chief Officer working off shore gets about 5000 USD a month. 5% tax rate. People do not have debt over here.

Of course there are many issues in Africa. But it is interesting to see how people here can spend money. There is liquidity. Whereas in my business I rarely get sales in Canada or the UK. People are essentially broke.

Keep up the good work Garth. What is all this new sign in security stuff now? Is that to scare away the trolls?

11.48 pm here. I’m at the bar of the Intercontinental having a beer and enjoying your blog.

Cheers

Ken

#6 Sleepless in Victoria on 06.05.14 at 6:52 pm

The only thing balanced, diversified, and liquid this 20-something’s friends are interested in is the tray of drinks brought over to us at the local pub as they regale me with tales of their newly bought houses.

It’s still good to be musty, Garth. Thanks.

#7 prairie person on 06.05.14 at 6:53 pm

At the moment, I’m in a small town on the prairies. People here fight over minimum wage jobs. There aren’t many of them. Like many small towns nowadays, it has a retirement home, it is lucky because it has the high school and a hospital. These are all service jobs. Medical may be high end but it is still a service job. No one is manufacturing anything. There are local stores: grocery, pharmacy, hardware but a city shopping mall is less t han an hour away. Finding tenants for commercial buildings is difficult. In summer and winter healthy retirees make some money cutting grass and removing snow. More service jobs. A few fortunate people have telecommuting jobs. There are a lot of pensioners. There are farmers, commercial fishermen, and some boat building. Houses generally run between 300k and 500k but there are some over 1M. If wealth comes from goods produced, there isn’t much base. A lot of those 300k to 500k houses are recently new. I’m not sure where the money is going to come in a secondary market. Houses are going up for sale recently because of retiree deaths. It will be interesting to see where the money comes from to buy these houses. If it comes here, it leaves there. I don’t want to be a pessimist but I sure wish there were a couple of small factories paying decent wages and benefits.

#8 Time is up on 06.05.14 at 6:55 pm

Do you think interest rates will decrease here in Canada too Garth?

#9 Kris on 06.05.14 at 6:59 pm

A Vancouver forecasting firm made headlines this week saying houses there will sell for an average of $2 million on the downtrodden east side and $7 million in the west within a decade. Why? Because that’s the trend.

I hear this all the time here in Vancouver.
Its almost like logic does not apply to the damp-city anymore.
There is 3 billion chinese in china dying to move here and this is just the beginning of priced escalating toward the stratosphere.

#10 Jonathan on 06.05.14 at 7:11 pm

Of course, Garth, the quality of life up here is so much better, you must not forget that in your equation. That’s why real estate is worth it here.

In Independence MO, the low cost of housing includes living in areas where delusional gun nuts may be prowling the streets on killing rampages.

That could never happen up here.

We’re so different.

#PrayforMoncton. — Garth

#11 colin on 06.05.14 at 7:13 pm

Didn’t we learn from Greece what happens when nothing of value is produced and everybody in society has government jobs with big pensions?

#12 Smudgekin on 06.05.14 at 7:16 pm

Quality Meat Packers, Toronto – pig abattoir @Tecumseth/Wellington closed some several hundred jobs lost there.

#13 gmp on 06.05.14 at 7:27 pm

May I take a chance and ask why so many new Canadians think that Toronto is the “be all-end all”

there are so many good towns in Ontario. average family income $90000 and ave house price $200000.
No noise, no congestion, no dirty smells or ignorant people or especially pretentious people.

#14 Patient in Richmond on 06.05.14 at 7:33 pm

3 billion chinese that cant even afford buying in china due to low income will hardly buy 7 million dollar houses in vancouver .

http://www.cbsnews.com/videos/chinas-real-estate-bubble/

#15 Happy Renting on 06.05.14 at 7:35 pm

Well, we’ll keep sucking the country dry of its natural resources. So long as prices and demand keep up we should be able to keep the party going for a few more years (at least in some parts of the country. The rest can fall back on equalization payments.) Scared to see just how bad things will get when TSHTF.

Thank you for worrying about us, Garth. I wish more people were worried and acted accordingly.

#16 ILoveCharts on 06.05.14 at 7:40 pm

Does the manufacturing data include stuff like software and films?

#17 Smoking Man on 06.05.14 at 7:40 pm

#8 Time is up on 06.05.14 at 6:55 pm

Will rates drop….. Look at the chart…..

Absofriginlootly…..

#18 Dean Mason on 06.05.14 at 7:43 pm

Yes and their cost to maintain and own a condo will be $10,000, $15,000, $20,000 etc. a month.

Good luck with that concrete box dwellers!

#19 Macrath on 06.05.14 at 7:43 pm

Very interesting, I`ve been thinking about the eventual consequences of this trend since the early eighties recession when they demolished the Massey Ferguson plant acreage and filed it with particle board houses. I wondered , “Gee, no jobs but lots of houses how is this going to work out ? ” This has been going on like forever and the eventual economic debt disaster is likely to be monumental . Canadians in the history books as the dumbest f*&ks on the planet.

#20 Seaforthdoctari on 06.05.14 at 7:52 pm

I used to be in the design business; packaging, promotional material, etc… but left the industry a few years ago as I saw billing rates plummeting across the country. The constantly shrinking selection of clients being chased by an ever increasing number of design firms was having the inevitable effect. Who needs design services in a nation that doesn’t make anything? Our banks certainly aren’t doing anything to help reverse this trend, their focus is on mortgage financing, not business investment. The fact that all of those mortgage slaves also need companies to work at is always another bank’s problem. Canada has lost many of the head offices that it had in the ’90s and in turn has gained a few tech start-ups with no money to spend. Meanwhile, of course, house prices have doubled. This has been the story across Canada for two decades now as we’ve shed corporate head offices and slowly evolved into a developing world economy. We produce commodities without adding any value or work at a foreign owned company’s branch office. Name a major Canadian internet company. A car maker? Beer? Furniture? (a few success stories there perhaps, but small ones).

#21 Mr. Reality on 06.05.14 at 7:52 pm

Deflation

The result of the largest demographic in human history not replacing itself in the developed world.

Its scary thinking about what our medical system will look like in 20 years.

Then think about real estate……then you rent :)

Mr. R.

PS – Japan is our template

#22 Nemesis on 06.05.14 at 7:53 pm

#It’sBetterInBelarus!Really. #NoChickenStripsOnMotoGPSlicks.

“So, without enough actual jobs making stuff that we sell to the world, what next?” – HonGT

Funny you should ask, AuldPol…

[FT] – Belarus plans to bring back serfdom

…”Alexander Lukashenko is living up to his reputation as Europe’s last remaining dictator. The president of Belarus has decided to bring back serfdom on farms in a bid to stop urban migration.

Lukashenko has announced plans to introduce legislation prohibiting farm labourers from quitting their jobs and moving to the cities. “Yesterday, a decree was put on my table concerning – we are speaking bluntly – serfdom,” the Belarus leader told a meeting on Tuesday to discuss improvements to livestock farming, gazeta.ru reported.”…

http://blogs.ft.com/beyond-brics/2014/05/29/belarus-plans-to-bring-back-serfdom/

#HowtoAvoidChickenStrips? #TheAngleOfTheDangle!

http://youtu.be/J73XRDGPcpE

#23 R Kaputnik on 06.05.14 at 8:01 pm

#13
Home is where the heart is dude.
I am a Christie Pits boy and damn proud of it.
You know not what you speak of.

Thanks for all Garth, keep on preaching…..little by little

#24 Old Man on 06.05.14 at 8:07 pm

This could be a trend of sorts, as have never seen so many old groups (6) all appearing in one place working for peanuts this summer; must have run out of cash. I met the one lady in the fall of 1969 as her business manager robbed the Trust Fund and was playing in a joint on Yonge Street north of Dundas on the east side.
She and her group were at the top for a decade, but her show was the best I have ever seen; stayed for both sets; 12 feet from the stage; and came back the following night. She broke away and sat down with us to have a drink for about an hour between sets and signed lots of stuff for us, as was the lead singer. I see she at 72 years of age will be performing again and might go, as is working for peanuts – sad!

#25 Kris on 06.05.14 at 8:11 pm

Canadians in the history books as the dumbest f*&ks on the planet.

AMEN BROTHER !!!!

#26 Mike T. on 06.05.14 at 8:13 pm

#1 dienekes

I like your thinking. Maybe we should include Ketchup chips. I do not think those are available in the US, sadly.

Good Dr Pepper + ketchup chips = obviously better!!

sadly there may more truth to this than can be reasonably fathomed.

#27 Joe2.0 on 06.05.14 at 8:17 pm

There are only a few places that are relatively safe to live on this planet.
People who have travelled extensively likely know what I mean.

The planet is a mess and many parts of it are very unsafe.
Either because of the criminal element or because of an unhealthy environment.

Have you ever seen the pollution in Parts of China.
It’s mind blowing, they shut whole cities down with millions of workers.
Tools down.

Most of S & Cental America is quite dangerous, it’s safer if you live there then if you have a buisness because people want a cut, but things can go sideways quickly.
You don’t hear about the frequent kidnappings.

Africa’s dangerous.
Phillipines dangerous.
Europes a mess with a rapidly growing radical muslum population and a financial meltdown.
Eastern block nope.
Japan radiation
Australia/ New Zealand good choice hence the housing market spike.
USA also has some good areas.
Iceland – Greenland it’s hard to find work.
Canada low crime, low interest rates, lots of work in areas (oil towns)immigration friendly policies(up to lately)

There are people who will almost pay anything to get here because they know what a s..t hole 8/10 of the planet is.

Can’t blame them.

But the unseen elephant in the room in Canada and in the States /Western Hemisphere is Fukashema radiation there’s a gag order on the press.

The levels over here are high.
Infant stillborn deaths the highest on record in Vancouver and down the California coast.
Fish with high radiation levels being tested off the coast.
Groundwater also with high levels.
It’s deadly.

Do your research it’s being covered up.
It’s a silent killer and its coming to a neighbourhood near you.

#28 Victoria Real Estate Update on 06.05.14 at 8:18 pm

Single Family Home Sales Totals
. . . (January through May). . . . .
. . . . . Greater Victoria. . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . .
2007…********************
2014…*****
2013…**
2012…*****
2011…****
2010…************
2009…*********
2008…*************
2006…*****************
. . . . . . . . . . . . . . . . . . . . . . .
. . . . . -35%. . . . . . . . . . . . .0%

This chart compares single family home sales totals of recent years (January through May) to 2007’s total, which was (at best) average for Greater Victoria.

2014’s SFH sales total (January through May) is well below Greater Victoria’s long term average.

House prices in Victoria have been declining since 2010 in a heavily stimulated environment of historically low interest rates.

Downward price pressure has been the name of the game in Victoria since 2010 and that weakness has continued into 2014.

Let’s take a look at some houses (in above average areas) that have been sitting on the market with no buyer.

* 2738 Foul Bay Road (East Saanich)
Asking price: $438.888 ($84 K below assessed value)

A couple of weeks ago I wrote about this house. It is situated on the boundary that divides East Saanich and Oak Bay. Two weeks ago, this house was priced $63,000 below assessed value. Since then it has undergone a price drop and is now priced $84,000 below assessed value. There is absolutely nothing wrong with this house. It has 3 beds, 2 baths, 1853 sq. ft., hardwood floors, and is situated on a large lot. It is empty and move-in ready. This house hasn’t sold because sales are slow (well below Victoria’s long-term average) and there are too few buyers.

* Grange Road in West Saanich:
Asking price: $549,900 ($82 K below assessed value)
(5 beds, 2 baths, large, private lot, water views, water access nearby)

I wrote about this house last week. It is an above average house in an above average area but it continues to sit on the market at almost $100 K below assessed value. There is absolutely nothing wrong with this house. It hasn’t sold because Victoria’s housing market is extremely weak and prices are falling.

Girls and guy, the size of Victoria’s housing bubble is comparable to the bubbliest housing markets in the US (Los Angeles, San Diego, Phoenix, Las Vegas, Miami, etc. ) at the peak of the 2006 US housing bubble. Economic fundamentals (incomes and rents) do not support house prices in Victoria. History has shown us many times that whenever a housing market becomes extremely overvalued the way Victoria’s is right now, house prices revert to the mean and that always involves a deep, multi-year price correction. Prices in Victoria will fall (much more) to a level where incomes and rents can provide price support. If you buy now you will be forced to deal with the severe economic stress that is associated with buying near the peak of a major (deflating) housing bubble. Millions of US families regret buying near the peak of the 2006 US housing bubble. Don’t make the same mistake they did.

Until next time – Cheers!

#29 Condo Minion on 06.05.14 at 8:23 pm

This is also why in the GTA the 905 area will be so utterly crushed in the coming downward slide.

At least if you live in the city, when the economy stalls you can continue to enjoy all those other amenities of the city and rationalize your tiny condo lifestyle or teetering overpriced SFH. This will uphold some value, since you are IN the city.

In places like Brampton, Ajax or, god forbid, even further out, your property value is completely based upon proximity to the Toronto economic engine. Otherwise, it would be peanuts, just farmland plus the cost of bricks.

As that engine sputters and stalls, what value does your property have? You are nowhere near physically close enough to regularly enjoy any other realities of city life.

But wait, there’s more!

Major road tolls for commuters are a virtual certainty, coming soon. I heard a radio commentator today describing how his regular 80 minute commute including the Gardiner took 3.5 hours every day this week.

Oh, and that’s EACH way.

Yup, it’s really worth it to ‘invest’ in a $400,000 particle board shack in the suburban wasteland.

#30 Freedom First on 06.05.14 at 8:27 pm

Nicely said Garth. This post is nothing but the truth. Our Governments know this is true. Banks know this is true. Manufacturers know this is true. The many many thousands of people recently laid off know this is true. The Real Estate Industry knows this is true. Then who is not aware this is the truth? I think it is the unbalanced, the unliquid, the undiversified, the highly leveraged, and the financially illiterate. I know that you care about people Garth. Your very public whole life history proves that, including this unpathetic free blog.
I care too. I do not have as much ability as you to help people Garth, but I do know that how I live my life has had a positive affect on some people. Unfortunately, many people want the so called “easy” way to financial security which makes them close minded and for many different reasons, simply unable to handle the truth. I really really hope you continue your blog Garth.

#31 Kris on 06.05.14 at 8:27 pm

A Vancouver forecasting firm made headlines this week saying houses there will sell for an average of $2 million on the downtrodden east side and $7 million in the west within a decade. Why? Because that’s the trend.

WHAT IS SCARING THE PANTS OFF OF ME IS THAT I’M ACTUALLY STARTING TO BELIEVE THIS.

#32 Teacher's Ass-istant on 06.05.14 at 8:33 pm

This is all true but started quite some time ago. The reasons are also many. When your manufacting sector is so heavily dominated by branch plants that are U.S. owned free trade is not going to be a great thing for that sector. Couple that with everything that has happened in the states over the last decade and you have many empty industrial buildings. Surrounding those places are unemployed people with the same skillsets as their Canadian counterparts. Cheaper costs, incentives galore from every level of government and topped off by so many states adopting right to work rules.

That’s not even mentioning all of the global events. The cheap cost to build a plant in Mexico. That is where the hemi engines that are installed at the Brampton Chrysler plant come from.

I recall when three major brake manufactuers moved to Missouri years ago. Speaking to the people down there with the new jobs who were quite impressed with themselves that they’d aquired these jobs from Canada I couldn’t help but point some things out. First in Canada they were getting double the hourly pay, the health and safety rules were very much stricter, the same applied to the enviromental rules (many hazardous materials in use). Last thing I told them was it is 1,100 miles from Toronto (where the jobs were previously) to Missouri and it is about 1,100 miles from Missouri to Mexico. Where do you think those jobs will go next?

Two years before the FTA went into effect Caterpillar had built a ten million sqaure foot facility in what at the time was extreme north Brampton. The Fta went into effect and they moved all of those operations to the U.S.A., almost immeadiately, leaving the building empty for a very long time while it was for sale.

There is really no end to these stories since the enactment of the FTA and then NAFTA. We truly didn’t do anything to prepare.

It’s all more complicated than just the cost of housing here but that sure is one majorly big factor in the equaztion. We really do seem to think it’s different here and not just about real estate. If you look back you can find countless examples of where even our governments have watched a policy fail in the U.S. or other countries and then promptly adopted it as if somehow it would work here. Maybe all of this is why we have a reputation for being polite and apologizing.

#33 Flawed on 06.05.14 at 8:34 pm

I wonder what will happen in GTA and Vancouver when the govt finally starts doing it’s job and asking those men (and a few women) who dump the wife and kids in Canada (who get free healthcare and education) while they work tax free overseas to prove income in Canada. Whoops !!

#34 Babblemaster on 06.05.14 at 8:36 pm

Garth, what happened to your prediction that rates would rise? Not for a long, long time, I’m afraid. Rising rates would be the biggest factor in lowering housing prices and it’s just not in the cards.
Regarding Brampton RE prices, massive immigration will continue to work against lower prices. Many, many Brampton houses have multiple families living in them and that helps to cover the carrying costs. Absolutely no comparison to Independence.

#35 AshTO on 06.05.14 at 8:38 pm

I can’t believe I was told I could afford to mortgage a property that costs between 2 and 2.5 times my gross income. What a joke!

The hipsters & the rich can share this city…to the fresh air I go!

Anyone who has been in Toronto (especially recently) knows this is not a world class city.

#36 Flawed on 06.05.14 at 8:40 pm

But the unseen elephant in the room in Canada and in the States /Western Hemisphere is Fukashema radiation there’s a gag order on the press.

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

I would think things like the 600 billion in un-funded Public Sector Union money would be a pretty big animal. Who is going to be the guy that says “Hey we are raising taxes by 10%” so Govt workers can retire in Mexico at 55.

#37 Loon on 06.05.14 at 8:50 pm

I think that hoping for a strong manufacturing base in Canada is antiquated thinking.

As long as Canadian businesses are utilizing the stronger (and cheaper) manufacturing offshore and profiting at the same time, who can blame them ? this is a global economy after all.

This mode of operation does not benefit the environment and climate change, but who cares about that (yet) right ?

#38 Hawk on 06.05.14 at 8:53 pm

#11 colin on 06.05.14 at 7:13 pm

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

We’ll find out soon enough, whether or not we want to be Greece………..Kathline or Tim Hudak :-)

#39 mortgagebrokeron on 06.05.14 at 8:54 pm

This is the same thing I seen last weekend in Pennsylvania and New York State….

Garth is right, there will be deflation in Ontario, count on it… either Hudak shuts the taps on money flowing to the public service, or the bondholders will charge ontario higher interest rates and or stop lending…….

Did you know that approximately 40% of real estate deals that fall apart is because people can’t get financing.

When this deflation starts to hit it is going to hit hard!!!!

I am concerned however I can’t do a thing so I don’t worry…..worrying doesn’t help anyway……. However in 10 yrs Ontario will look alot different…. lack of money for roads pensions etc….. it is coming….

feeling smug about your pension????

#40 OttawaMike on 06.05.14 at 8:55 pm

#27 Joe2.0 on 06.05.14 at 8:17 pm

Complete crap.

Have you ever left your Mom’s suburban basement Joe?

Travel a bit, the world is far from the scary place you fantasize about.

#41 Ole Doberman on 06.05.14 at 8:58 pm

In regards to Garths post from yesterday, gold went up for 13 years before it was done.

Right about where real estate is now.

Martin Armstrong who is a genius of cycles also shows the 13 year bull cycle as typical and nothing new.

Garth might finally be right…..

#42 Sherwood Park on 06.05.14 at 8:59 pm

Article in The Economist re South Korean personal debt. Worth the read. http://www.economist.com/news/finance-and-economics/21603047-korean-households-are-struggling-under-mounting-debt-hole-won

#43 Smoking Man on 06.05.14 at 8:59 pm

New Brunswick cops asking everyone to turn on the outside lights to help them put a bullet in that phycos brain…

I’m just waiting for the tree huggers to come out chirp the carbon foot print of lights on..

#44 T.O. Bubble Boy on 06.05.14 at 9:03 pm

My question of the day: is anyone still calling for a “soft landing”???

When you have CREA/TREB saying average price is up 8% year-over-year, isn’t anyone saying “hmmm… at that rate, prices would double AGAIN in 9 years”

#45 Sebee on 06.05.14 at 9:04 pm

Nice chart Doug. Picture really does say a thousand words.

#46 Victoria Real Estate Update on 06.05.14 at 9:04 pm

Incomes and rents do not support house prices in Victoria (not even close). Incomes in Canada and the US are approximately the same so house prices should be approximately the same as well. Historically, house prices in Canada and the US were similar until 2006, when the US housing bubble began to deflate while Canada’s housing bubble was given even more housing market stimulus that resulted in even higher prices.

Let’s take a look at house prices in Albuquerque, New Mexico, where incomes and rents support house prices.

House criteria:
* min. 3 bed, 2 bath
* min. 1800 sq. ft. of above ground primary (main) living space
* 2004 or newer
* attached double garage

In Victoria, a house like this would probably cost $700 K or more.

In Albuquerque, the combined value of these 6 houses (that fit the above criteria) is about $782 K.

$ 111 K ( 4 beds, 3 baths, 2,275 sq. ft.)
$ 120 K ( 4 beds, 4 baths, 2,121 sq. ft.)
$ 132 K ( 3 beds, 3 baths, 1,990 sq. ft.)
$ 136 K ( 3 beds, 2.5 baths, 1.900 sq. ft.)
$ 138 K ( 3 beds, 3 baths, 1.988 sq. ft.)
$ 145 K ( 4 beds, 2 baths, 1.896 sq. ft.)

House prices in Victoria will fall a lot further before reaching bottom (where incomes and rents provide price support).

#47 LB on 06.05.14 at 9:06 pm

@Condo Minion

Whatever you say. Not everyone wants to live in a shoebox IN the city. And condo sales are plummeting, so go a head and enjoy what the city offers while your condo continues to lose value.

#48 not 1st on 06.05.14 at 9:08 pm

Garth, your chart looks cherry picked. When you say exports, you are talking about manufactured goods. Add in all the raw resource exports such as timber, potash, uranium, hydro, agriculture etc. and I think the chart goes the other way.

Its been known for a while that Western manufacturing cannot compete with china so there is no use trying, but they need the resources and they don’t have them. Thats where canada’s future lies.

#49 Banjopete on 06.05.14 at 9:12 pm

Blame the media, at least now the concept of balanced reporting is that they’re hedging their bets in both directions. The national (re)post has stories of “what to do if you can’t make your mortgage payments” alongside “RE surges to new highs; don’t worry if you haven’t bought in yet”. That way at least when things go the way they’re going they can at least say we warned as early as….

We’ll believe anything you tell us enough times.

#50 Andrew Woburn on 06.05.14 at 9:13 pm

dosouth

Further to my note of yesterday, here are the most recent sales in my area of North Nanaimo, all of them well over assessment

6306 CORFU DRIVE 374977
6378 LASALLE ROAD 372366
6124 CARMANAH WAY 374543
6272 CAPRICE PLACE 374014
5706 LINLEY VALLEY DR 370436

#51 Tony on 06.05.14 at 9:20 pm

DELETED

#52 Old Man on 06.05.14 at 9:36 pm

While Canada is sleeping under a Caesar nightmare there is virtually nothing being said in the MSM about the oil and gas finds during the past year. $trillions in reserves found in Argentina, Iran, and Australia to name but a few. The big oil companies are there of course with lots of workers.

#53 Condo Minion on 06.05.14 at 9:38 pm

#38 LB

You said:

“Whatever you say. Not everyone wants to live in a shoebox IN the city. And condo sales are plummeting, so go a head and enjoy what the city offers while your condo continues to lose value.”

Nothing personal, man. I do agree condos should come down, quite a bit in fact. But the fundamentals, of being IN a city where there will remain so many opportunities for work, recreation etc.. without the need of a car (or let’s be real, most driveways in Brampton or Ajax have at least two, sometimes three cars) will make it better.

I knew it would touch a nerve with some suburbanites.

But be honest with yourself. So much of the suburban “lifestyle” involves painful rationalizations that people pretend to look away from, thinking that they enjoy lower living costs with higher wages created by involvement in the Toronto economy.

What are those rationalizations?

There’s the horrible commute (if you don’t commute from suburbia, good for you, but that is HIGHLY unusual)

There’s the relative lack of things to do and enjoy. (Costco is not recreation, dude! Lots of city slicker jokes have to do with all you guys going to Costco and the like. You really need to buy all that processed frozen food, in bulk?)

http://www.youtube.com/watch?v=OyNh8BNEXrs

There’s the total dependence on cars. (and the health and weight issues that are much worse in suburban demographics)

There’s the loss of personal and family time due to the above factors. A tragic loss you never get back, trust me.

There’s a feeling of reduced safety compared to the inner city. No “eyes on the street” in suburbia like there are in the city.

There’s no “there, there” in the 905. Been there myself and often visit folks there too.

Still, I would move there myself IF I found a great job there I could walk to. But to be in orbit around the Toronto economy? Forget it. Better to find REAL small town life, which is much, much better. Try it, you’ll like it if you can get a good job. I have.

I visited friends east of Toronto, Whitby area, last weekend. Seriously, it was like there were four cars in every crowded driveway! What is this, the unemployed children of suburbanites coming back to the nest with their own cars?

As that Toronto economy falters, which Garth points to, you will find it much harder to sell property in the 905 because of this lack of real intrinsic value.

Your best bet is to sell to each other.

Maybe Costco has a bulletin board to post the home sales ads on?

(P.S. I sold my shoebox condo, now rent the main floor of a nice house walking distance from a subway. Loving it!)

#54 young &foolish on 06.05.14 at 9:43 pm

Chilling post ….. what determines value? I guess what you can make and sell to others for a profit. Maybe services? Raw materials? Borrowing against inherent value? Or you can engineer circumstances and create a faux economy, like Disneyland. Who gets to say what goes?

#55 walter safety on 06.05.14 at 9:46 pm

Spent some time in Independence most of your readers would be comfortable there especially the readers who like familiar chain restaurants.
There is a range of housing choices you don’t have in most parts of Canada so people can work for less as you pointed out.However in the upper half of the income range you have nice houses in nice areas with house prices approaching 300k – also familiar in style.
All people need to make the move to a lower cost area is a connection now Canadians will have those connections as some of their former workmates will relocate to these areas.

#56 Christopher Mewhort, EA on 06.05.14 at 9:47 pm

Basic US Federal tax facts – A couple living in that inexpensive house gets to deduct from their gross income either the “standard deduction” (currently $12,200 for a couple filing MFJ) or the total from Schedule A which is charitable giving, health costs over 10%, mortgage interest, property tax, and other minor amounts. If they obtain a mortgage of $76,950 (90%) at 4.5%, their payments would be about $389.89 each month or a maximum interest in year 1 of $3,437.34. Add a couple thousand for property tax. Now they get to deduct either about $5,437 or $12,200 from their income. Most will choose the standard deduction, of course. The ability to deduct mortgage interest and property tax is moot for them. I wish more commentators on this blog would understand this basic math.

Christopher Mewhort, EA

#57 Joe2.0 on 06.05.14 at 9:48 pm

#40 Ottawa mike

Yes I’ve travelled a little.

Africa, Philippines, S&C America, USA, Cuba.
South Pacific , Europe, Canada.

I know people who have been kidnapped where I live in Mex 6 months of the year, one was killed the other escaped.

I also know people who were on the US Ronald Reagan
which bugged out of Fukashema after they realized how hot the area was.

Since then most of the divers have died as have a number of the plant workers.
Do your homework, ignorance and sarcasm aren’t an excuse.

#58 shawn on 06.05.14 at 9:52 pm

Nothing to Argue With There

Absolutely agree soup and ketchup and cookies and autos will be made where they are cheapest to make. And that is not likely in Canada

Selling the same houses to each other at ever higher prices does not create wealth.

Unless Canada can survive on raw materials or some kind of high value exports, the economy could be in trouble.

It seem to me that wealth comes from natural resources, the division of labour and the trade that is always associated with the division of labour, capital investments in the form of productive assets, and requires the rule of law and property rights and a degree of economic freedom.

We have those. But no more so than the United States. We will not likely sustain a higher living standard than the Americans.

We don’t necessarily need to manufacture things if our highest value is in producing software and banking and insurance that others value. But it’s hard to see how we have competitive advantages there.

Hopefully our prosperity does not rely too heavily on natural resources. But it is something for those of us in Alberta to ponder certainly.

I can’t predict he future. But I can safely say that it is always wise to save some of your income and invest it mostly in strong growing companies that have competitive advantages. Growing wealth in a reasonably diversified fashion is always a good idea.

None of us can do much about the National Economy but we can at least look out for ourselves and our families.

Meanwhile, pass the popcorn and we shall see how things evolve.

#59 Joe2.0 on 06.05.14 at 10:01 pm

Typo
Some of the divers have died 60 have cancer.

#60 Harbour on 06.05.14 at 10:02 pm

n Canada, this is progress. Who needs useless, noisy, downscale factories full of people with rough cuticles and bad tats when all we need is to sell real estate to each other at ever-higher prices with ever-larger mortgages? Then everyone benefits. Obviously we’ve found a new economic reality. It’s so good to be different. And smart.

———————————————————-

Outside of Canada I believe they call that a “pyramid scheme”

#61 takla on 06.05.14 at 10:08 pm

Just who will take the blame on the chin for this stagflation situation we find ourselves in?Banks,politions,central planners??
Looking back FREE-TRADE seems to me to be a large part of our problem.Off shoreing of manufacturing to keep competitive was the next nail in the coffin.
CMHc and low interest rates help further the extention of debt as jobs disappeared.
Their getting predictable outcomes Bailing out banks and leaveing the middle class consumer to slowly sink and become less and less credit worthy,no wonder the banks aren’t lending and the economy is in a tail spin…..thank god my house sold when it did!

#62 Smoking Man on 06.05.14 at 10:09 pm

I’m in hell, pumping keys on the worced book ever written..

We’re dog sitting wife’s sisters pug. It’s retarded.. It stares at me and makes weird sounds, a cross between fight squirrels, and mating raccoons..

It runs side ways… Stands and spins before it lifts it’s leg..

It’s terrified of my four pound poodle…

And randomly goes into hysterical 5 minute barking and crying episodes.

I don’t think I can give the bastard back… He’s growing on me..

#63 Old Man on 06.05.14 at 10:10 pm

Well isn’t this interesting as Caesar’s front man Mike Duffy during 2009 – 2012 spent 34 nights at a hotel instead of at his declared principal residence in P.E.I. as the RCMP have the records. Or did he stay at his principal residence and the hotel room was used for someone else or for another purpose? Ha Ha

#64 Keith in Calgary on 06.05.14 at 10:17 pm

I just spent 9 days on Vancouver Island. ….5 days of work and 4 days of holidays.

It is truly a beautiful place.

On the coast between Victoria and Nanaimo it has but 1/4 the annual rainfall of Vancouver.

There is no real traffic to speak of on Friday afternoon at rush hour……nor line ups at Tim Horton’s at 700AM.

I want to live here. I could get a great 6 figure job because of my very unique skill set, job experience, and special contacts. In fact, I have been offered a few. But my wife, who is a medical professional with the same qualifications, cannot…..for there is no work in her field. In fact, there are no “real” jobs on the island to speak of……real estate is for sale and rent everywhere you look……commercial buildings are for lease on every street. The economy sucks trucker ass.

Which is why real estate there is 1/2 to 2/3 the price of Calgary property, rent is 35% less, and there is no HAM.

Interesting that………..

#65 gut check on 06.05.14 at 10:21 pm

Could negative interest rates happen here, do you think, Garth? I think they could, just like I think a Cyprus style bail-in could happen here. You’ve already gone OTR to state that those fearing bail ins for Canada are in tin foil hat territory, so your take on the negative interest rates will be enlightening.

The world has gone completely mad what with several nations now including prostitution and cocaine in GDP calculations. So who knows what might happen?

No depositor here will be bailed-in. Ever. — a Garth

#66 shawn on 06.05.14 at 10:28 pm

Young and Foolish Nails it

From 54:

Chilling post ….. what determines value? I guess what you can make and sell to others for a profit. Maybe services? Raw materials? Borrowing against inherent value? Or you can engineer circumstances and create a faux economy, like Disneyland. Who gets to say what goes?

*****************************************
Correct, value and wealth is WHATEVER you can produce and sell to others at a profit, be it cars, peas, soup, ketchup, insurance, hockey, houses, oil and gas, clothing, name brand coffee, sugar water, water, movies, software, books, air, ANYTHING and that includes Disneyland. Nothing faux about it.

Who get to decide what is of value and creates Wealth. The market is the only reasonable judge.

One individual may judge the production of a concert to be much less valuable than the production of soup. But the market gets to decide. If the concert turns a profit, then the market values it. If soup turns a loss then the market does not value it and it will close down.

As individuals we are all spectators to the workings of the market.

We can try to predict it (good luck). We can react to it. We can rail against its excesses and stupidity. But in the end the best most of us can do is live according to our own values and remember to try to save and accumulate wealth (unless we don’t happen to value that). We make our choices in the economy and we see where we get to. There are no certainties. Life is a fun ride. Enjoy.

#67 Retired Boomer - WI on 06.05.14 at 10:30 pm

GREAT!!! I’ve always wanted to own a nice 3 br cabin in the Canadian shield area north of the Sault IF the price was right! Keep up your silly bullshit, and it will be!

CASH HAS AMAZING POWERS!

#68 Flawed on 06.05.14 at 10:31 pm

#48 not 1st on 06.05.14 at 9:08 pm
Garth, your chart looks cherry picked. When you say exports, you are talking about manufactured goods. Add in all the raw resource exports such as timber, potash, uranium, hydro, agriculture etc. and I think the chart goes the other way.

Its been known for a while that Western manufacturing cannot compete with china so there is no use trying, but they need the resources and they don’t have them. Thats where canada’s future lies.

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

Let me play the frog in the pot of water that is slowly rising in heat.

50 plus MPG vehicles.
more adaptation of electric/hybrid cars.
better insulated homes
heat pumps
electronic controlled home system that do not wasted hydro.
concrete houses (not wood)
3D printed houses (not wood)
thin film silicon electronics (not copper PCB)
and more and more and more….

Which means? LESS AND LESS AND LESS resources from the country with the LOWEST productivity in the OECD group of countries.

Houston…..I think Canada has a problem.

#69 AfterTheHouseSold on 06.05.14 at 10:33 pm

“But already there’s ample evidence consumers are hitting their debt ceiling…”

Our short term rental this month is a waterfront cottage at a small mom and pop run resort in central Ontario. We paid $1000 mth for a cottage that usually rents for $600 per week. Bookings must be way down for the season. For some reason the cry of the loon seems particularily melancholy tonight.

#70 Edward_in_TO on 06.05.14 at 10:35 pm

What is happening to Canada is called the”financialization” of the economy. Other countries are giving Canada an exceptionally good credit rating (likely more credit that is warranted) perhaps based on the energy export base in a climate of high energy prices. That good credit rating allows the Canadian economy as a whole to gain financial leverage. The financial leverage expands the economy where goods and services that can only be delivered locally and are difficult to export (real estate and hamburger flippers, manicurists). (Before the height of financialization we were able to export English teachers to South Korea, but we can’t anymore. ). But there is so much leverage that it either inflates asset values (real estate and financial assets) or goes abroad because prices are cheaper to secure goods and services for import and thus causes the trade imbalance. The US went through this in a big way, but now is coming to it is “creditability” limit, so manufacturing is going home.

#71 Smoking Man on 06.05.14 at 10:38 pm

#63 Old Man on 06.05.14 at 10:10 pmWell isn’t this interesting as Caesar’s front man Mike Duffy during 2009 – 2012 spent 34 nights at a hotel instead of at his declared principal residence in P.E.I. as the RCMP have the records. Or did he stay at his principal residence and the hotel room was used for someone else or for another purpose? Ha Ha
………

Seriously old man.. I’m fit, not over weight, mid 50s and have lost complete interest in shenanigans.. I’ve had my fill.

But this dude is over weight, what is he like 80, if I had money on that.

MY speculation is he bought the last run of twinkies, and secretly went to the room to Gorge on them.

#72 Teacher's Ass-sistant on 06.05.14 at 10:45 pm

“In Albuquerque, the combined value of these 6 houses (that fit the above criteria) is about $782 K.”

Yeah and you can get that blue meth!

“I’m just waiting for the tree huggers to come out chirp the carbon foot print of lights on..”

Really? Of all the stupid things you’ve typed, this may be the most moronic.

“When you have CREA/TREB saying average price is up 8% year-over-year, isn’t anyone saying “hmmm… at that rate, prices would double AGAIN in 9 years””

I don’t know, bringing the rule of 72 into this just exhibits way to much common sense. I don’t think the general public will buy it.

“Complete crap.”

Nah, can’t be. He read it on the internet. His mom has a wireless router upstairs.

#73 nonplused on 06.05.14 at 10:46 pm

We don’t need soup factories, we can’t afford soup kitchens and everyone eats at McDonald’s! And why not? Been through the produce isle lately? 2 tomatoes costs as much as a Big Mac! Except at Costco.

#74 Big Brother on 06.05.14 at 10:55 pm

Smoking Man you can’t keep the Pug, you told us before you hated this dog but it was your nices dog. So do tell now it’s the sister in-laws dog? We didn’t program your in laws so they are safe from Big Brother, but you we own!

#75 Mark on 06.05.14 at 10:58 pm

“When you have CREA/TREB saying average price is up 8% year-over-year, isn’t anyone saying “hmmm… at that rate, prices would double AGAIN in 9 years”

Maybe the particular houses their members are selling have gone up, but the sales mix of houses actually being transacted has shifted quite noticeably in the past year or so.

#76 PistolPete on 06.05.14 at 11:00 pm

Don’t worry Garth, the government is bringing back the cavalry! The chinese will save us….

http://www.scmp.com/news/china/article/1453230/chinese-welcome-canadas-new-investor-visa-stricter-rules-apply

#77 Waterloo Resident on 06.05.14 at 11:01 pm

Wow, Canada is losing good manufacturing jobs and replacing them with lower-paying service jobs at such a rapid pace !
It it astonishing to see how Canada is quickly going down the toilet.
And that chart shows it (non-energy trade balance); starting around 2007 it is on a ski-slope trajectory DOWN.

If demand from China ever starts to wane/fall, we are so screwed it’s not funny. With the U.S. producing a lot of their own oil now, they don’t need out oil, and that’s pushing down profits and jobs out West.

China: OH CRAP, watch this video and you will see how China’s real estate is totally insane. And God forbid if their bubble ever pops.

‘CBS: China’s real estate bubble’
https://www.youtube.com/watch?v=2LhRfsisl7w

Imagine what will happen when Billions of Chinese learn that their investments are only worth about 5 cents on the dollar, maybe less? Lets hope their bubble NEVER pops because if it does it will destroy the entire planet’s economy.

#78 Debtfree on 06.05.14 at 11:04 pm

We’re going to be just fine . Steve’s in Europe working on oil , gas and pipelines . All our kids and grand kids are going to drill , pump and pipeline . That’s all Canadian people need . And of coarse the people who make those ads for tv about how many jobs are being created making ads for tv . Also the ads for vets services to reach a few thousand vets . Good thing too that those ads will reach all 35 million Canadians just in case we all become vets all of a sudden . Must be because they have lost all the vets addresses otherwise they could just write, phone or email them . There by letting them know directly what a great job they are doing for them .

#79 devore on 06.05.14 at 11:05 pm

#13 gmp

May I take a chance and ask why so many new Canadians think that Toronto is the “be all-end all”

there are so many good towns in Ontario. average family income $90000 and ave house price $200000.

Good for you. But people go to where the jobs are. An immigrant has an infinitely higher chance of finding a job, and even getting by without one for a while with help of local immigrant community in a big city vs some small town they’ve never heard of.

No noise, no congestion, no dirty smells or ignorant people or especially pretentious people.

No culture, no entertainment, no restaurants, no fun, eh? However, there are plenty of ignorant and pretentious people everywhere. They tend to argue along the lines of “my town is better than your town”, when in reality it’s a question of subjective opinion and personal preferences and needs.

#80 UVZ on 06.05.14 at 11:06 pm

Great post!

Canadian real estate has been disconnected from many economic fundamentals for several years.

But come tomorrow, the property virgins and house horny masses will chug along with no fear just as they did yesterday.

#81 Cici on 06.05.14 at 11:06 pm

#1 dienekes

I think you’re on to something. Coke tastes better here too. I think the key differentiator is the sweeter: we use beet sugar, and they use corn syrup. I know they are big into corn…for sweetening, for energy and for eatin’ (think hominy grits). Apparently we only grow corn to feed livestock (pigs in particular). But where are all of these Canadian beets coming from; which province is the great Canadian beet producer?

#82 **NAKED APE** on 06.05.14 at 11:07 pm

Garth, I understand that you don’t want this blog to go anywhere near politics, but I can’t help myself anymore… Harp0 has preached for years about how the CRAP party has excelled on “jobs and economy”, while spending millions of taxpayer dollars on promoting propaganda to convince us that they are the true economists, the end all keepers to the salvation of this country and will be transparent and accountable. And where has it gotten us? Low paying rat-$hit jobs at Micky Dees and Timmies, with a few TFWs thrown in to mash it up more to bring wages down to those in third world countries… Only doing the bidding for his corporate Oil masters for maximum $$$, and doing quite well at it I might add… Can you speak Cantonese? If not, you’re not mining coal in B.C.

Harp0’s jet-setting in Europe right now, doing a little ‘holier that thou’ chest pounding and poking a stick at Putin, on his “Communist” bandwagon rant to suck in a certain percentage of the voters in this country, while we deal with serious issues at home – ignoring our Veterans needs, stupid prostitution laws that will surely be challenged in the SCC, proposed privacy, surveillance and copyright laws, conflicts with the new Privacy Commissioner appointment, the Sona trial on whether they buggered the last election, conflict with the Northern Gateway proposal as per some notable SCIENTISTS review of the proposal considered not thoroughly thought through by the Committee and where this FIPA agreement will take us with China… But this is how he deals with controversy. He doesn’t have to be in the HOC when the questions from across the floor fly – just leave it to his trained seals/minions to take the heat.

It doesn’t surprise me at all that lots of people are turned off from the politics and are hunkering down – unfortunately in their wee little spaces – like 500K+ mortgages just trying to eek out an existence. I know it’s gonna bite them in the a$$ should interest rates rise, and that we taxpayers are gonna be on the hook to cover them via CMHC. But what do you expect?

I just hope that Canadians finally wake up to this entire mess as it’s not pretty at the moment and won’t get any better soon in my opinion…

#83 West Coast on 06.05.14 at 11:11 pm

http://www.ekathimerini.com/4dcgi/_w_articles_wsite2_1_05/06/2014_540363

Waiting for market bottom….here’s your chance!….only problem is….. this is one place where it’s really hard to get a mortgage!

#84 Paul on 06.05.14 at 11:11 pm

#28 Victoria Real Estate Update on 06.05.14 at 8:18 pm

Thats my neighborhood. What about the other 1/2 dozen that have sold in the past 2 weeks?

#85 drydock on 06.05.14 at 11:31 pm

#4 Smoking Man.

They should have done that in 2008.

#86 Bottoms_Up on 06.05.14 at 11:32 pm

Great post Garth. We have sold our souls to the real estate devil, due to a severe lack of governing with foresight. Now we’re uncompetitive, and amassing massive job losses, especially in Ontario. And jobs are everything.

Recently, high powered lobbyists tried to get the minimum wage in the USA to go up to over $10/hr. Why? Because they finally figured out that to have a roaring economic engine, you need people with jobs, and surplus income from those jobs that filters back into the economy. Did it happen? No — it got blocked in the Senate. But Seattle is phasing in $15/hr:

http://thinkprogress.org/economy/2014/05/01/3433227/seattle-15-dollar-minimum-wage/

#87 tkid on 06.05.14 at 11:34 pm

#40, China’s struggle with pollution is well documented. It’s gotten so bad there that they have this giant screen set up so that if you want to see either the sunrise or the sunset, you can on the screen. It’s too damn polluted to see the sun in the sky.

As to Fukushima, they’ve had several meltdowns. There is no containment. The place is pouring radiation into the Pacific Ocean. So why aren’t world governments freaking out? Because there is nothing they can do about it.

Just because you are no longer reading or hearing about a news story in the media doesn’t not mean the issue is resolved.

#88 Patient in Richmond on 06.05.14 at 11:35 pm

@# 31 Kris
take a reality pill man , houses in Vancouver will not be 7 million .

there is hardly any Chinese buying here anymore . go on MLS.ca , pick some houses and track how long they sit . There are houses here in richmond that have come down over 150.000$ already . Hardly going up ….

#89 Bottoms_Up on 06.05.14 at 11:38 pm

#56 Christopher Mewhort, EA on 06.05.14 at 9:47 pm
————————————————
Thanks for posting, we need posters like yourself to clarify how it all works, and as you can see we are mighty envious of your 30-yr mortgages and (possible) deductibility!

#90 Bottoms_Up on 06.05.14 at 11:51 pm

#27 Joe2.0 on 06.05.14 at 8:17 pm
————————————–
You are exposed to radiation every day — sunlight, uranium, radon gas, cosmic, heck the dust on your tv screen emits dangerous radiation.

If you’re going to worry about radiation from Japan, please post some facts, that is, links to credible sources about these ‘dangerously high’ levels reaching our shores.

#91 Fleabitten Monkey on 06.05.14 at 11:51 pm

#9 and #31 Kris,
Then dive in….this leads to the buy now/or buy never mentality, which is why “locals” are the real culprit of pushing up market prices into the stratosphere in a place like Vancouver. Go ahead and be a debt casualty/or all financial eggs in one basket casualty of the HAM myth. Who else can see this?

#92 KommyKim on 06.05.14 at 11:57 pm

I have to disagree with you on this one Garth. The decline in manufacturing has very little to do with house prices and everything to do with government policy. NAFTA, CKFTA, EFTA, etc have reduced Canadians to hewers of wood, diggers of ore, pumpers of oil, etc. Very little value added today.

#93 Another recent Canadian on 06.05.14 at 11:58 pm

Hey recent canadian, I also recently moved from NYC to Montreal. The rent here is so cheap. I had the exact same thought as you, high real estate prices eventually render labor uncompetitive. Read Michael Hudson, he talks about the ongoing battle between financial capital and industrial capital.

#94 Jeff in Moose Jaw on 06.06.14 at 12:02 am

Well it’s summer vacation time, will be leaving on Friday for Toronto/London – staying for a couple weeks…. so, fellow blog dogs, if you see a red car with a Saskatchewan plate on it – say hi. (taking the CDN route).

#95 drydock on 06.06.14 at 12:03 am

#58 Shawn.

Here here.

#96 Bottoms_Up on 06.06.14 at 12:03 am

#11 colin on 06.05.14 at 7:13 pm
—————————————–
Yes Greece is in bad shape but it’s not the ratio of public service:private employees that is the problem. Check out the stats on Sweden:

“The percentage of public employees in the workforces of these countries ranges from 6.35 percent in Singapore to 33.87 percent in Sweden. Indeed the three lowest countries, and the only ones with fewer than 10 percent public employees, are Japan, Singapore, and Taiwan. The highest countries after Sweden are Denmark (32.3 percent) and Norway (29.25 percent). The remaining Scandinavian country, Finland, is fifth with 26.31 percent. In fourth place, just below Denmark, is Hungary. The other countries with public-employee percentages above 20 percent are Greece (22.3 percent), Canada, and Poland, Greece being the lowest in this group of eight countries, despite all the negative attention its public-employee workforce has received lately.”

http://www.becker-posner-blog.com/2011/09/too-many-government-workersposner.html

#97 drydock on 06.06.14 at 12:06 am

#62 Smoking Man.

Pugs aren’t dogs.
They are genetically modified alien tube worms.
Get a cat.

#98 Oceanside on 06.06.14 at 12:15 am

#64 Keith in Calgary on 06.05.14 at 10:17 pm
I just spent 9 days on Vancouver Island. ….5 days of work and 4 days of holidays.

It is truly a beautiful place.

On the coast between Victoria and Nanaimo it has but 1/4 the annual rainfall of Vancouver.

There is no real traffic to speak of on Friday afternoon at rush hour……nor line ups at Tim Horton’s at 700AM.
____________________________________________

Shhhhhhhhh………

#99 KommyKim on 06.06.14 at 12:26 am

RE: #27 Joe2.0 on 06.05.14 at 8:17 pm
But the unseen elephant in the room in Canada and in the States /Western Hemisphere is Fukashema radiation there’s a gag order on the press.
The levels over here are high.

No they are not. A Geiger counter shows virtually nothing above background here in Victoria BC. A little uranium glass gets it ticking though.

#100 WS on 06.06.14 at 12:29 am

I know you need to come up with daily content for this blog, but I think you should try to be more careful with how you explain to your readers why, for example, businesses like Unilever are pulling out of Ontario. Are bad things really happening to our economy because Brampton real estate prices are spiralling out of control?

A quick Google search shows that in 2009, Brampton house prices averaged $350 000, which is still many times more than the $82000 home in Independence today in 2014. If you live in Toronto, it’s well known that Brampton house values have made some of the smallest gains in the entire GTA since the price run up that began in 2009. Brampton probably offers some of the best value per square foot in the Toronto area and is one of the most affordable places to live if you’re looking for a newer home. And why shouldn’t Brampton have higher house prices than Independence? Brampton is a larger city with a population of 400 000 people, versus Independence which has a population of 100 000 people. Brampton is also a satellite city of Toronto, and Toronto is the fourth largest city in North America. It has a GDP 2.5 times the size of Kansas City, which Independence is a satellite city of. It should not be a surprise that it is much more expensive to live in the Greater Toronto Area than it would be to live in small town Missouri. It is likewise many times more expensive to live in a satellite city linked to San Fransisco, Seattle, Los Angeles or New York (and etcetera) than Independence Missouri.

Consider as well that the US minimum wage is 7$/ hour, compared to the Ontario minimum wage is 11$/hr. We make more than the Americans do but this is not anything new. Ontario’s minimum wage has been $10.25/hr since 2010 and was 9.50$ in 2009, still higher than the American 2014 minimum wage. Minimum wage in Ontario has risen approximately 2% a year which is fairly normal. I don’t see rising wages as any reason why the Americans would suddenly retreat because it’s been like this for awhile. You’ve also said repeatedly that Canadian incomes haven’t been rising in proportion to real estate and that all of this “house horniness” is unsustainable, which is true. Many people I know ranging in age and careers have had only small salary increases or salary freezes since 2009. You can’t just ask your employer to pay you a higher salary just because you bought an expensive house. That’s not how it works…they don’t care…

That aside, if Unilever was truly trying to go after low wages, why not move their manufacturing to Mexico? South America? China?

Unilever said themselves: “As more than 80% of the volume produced at Bramalea is shipped to the United States, Unilever made the strategic decision to make its investment closer to where the bulk of the product is consumed.” And why shouldn’t we believe them or suspect other reasons? Gas prices have skyrocketed in recent years, wouldn’t it make sense to relocate production to the US if that’s where all of the product is going to end up anyway? There are all the residual benefits of moving back the US as well (lower wages, lower taxes, faster delivery times, incentives from the government to bring manufacturing back to the US, etc.). I don’t see the direct correlation between this decision and Brampton’s rising house prices.

“And if you can manufacture soup for the North American market anywhere you want, why locate in a place where workers need to earn double the money?

I’m sure the boys at head office had such thoughts when they announced the Brampton soup mix-making plant there would shutter over the coming months…”

I think this post’s suggestion that rising house prices in Brampton = expensive workers = Unilever retreating to the US is a huge stretch. It is not based on any facts, it is just your opinion, and a very irresponsible one. It’s irresponsible, because after saying that, you insert a large graphic of a downwards sloping graph , showing one person’s prediction that manufacturing in Ontario will decline over the next few years. All of a sudden, it’s supposed to seem so obvious (because there’s a graph!) that real estate has destroyed Ontario’s manufacturing industry and we’re all screwed because the future is set in stone. Instead of informing people, it just fuels more fire into the flames of paranoia and fear.

I do think manufacturing in Ontario is declining because we are not competitive with the US, but there are so many other reasons why we’re not competitive that are not related to real estate.

You should really focus more on personal finance tips and move beyond talking about all the doom and gloom real estate has caused. You probably aren’t trying to encourage it, but from reading the comments (some of them very bitter), it seems as though many of the readers have been sitting on the sidelines and have been attempting to time the market from as early as 2009. Timing the market is such a futile and frustrating effort. Nobody has a magical crystal ball and can know when things will happen. Economies grow, and they eventually correct. Then it happens all over again. It’s cyclical, and it is why it has taken so long for your opinions about real estate to become relevant. On the flip side, advice on smart, careful management of personal finances will always be relevant and productive. It would probably make for a healthier community on this blog.

#101 Happy Renting on 06.06.14 at 12:30 am

#64 Keith in Calgary on 06.05.14 at 10:17 pm

Sounds like retirement paradise. One could move there and start a business catering to seniors (with cashola, not the broke ones.)

#102 Tony on 06.06.14 at 12:37 am

Re: #58 shawn on 06.05.14 at 9:52 pm

Canada’s prosperity depends on the price of natural resources. The future looks bleak as oil and especially palladium are looking to take a huge fall in price.

#103 Setting the Record Straight on 06.06.14 at 12:47 am

“Let’s see, of the 6.9 million employed Ontarians, 1.3 million are public sector. Let’s assume that 2 million people total are either public sector or married to public sector workers. That means that 2 million out of the ~ 8.9 million voting age adults in Ontario benefit from public sector pay. Not a bad voting block to have behind you.”

Public sector workers should not be allowed to vote.

#104 millenial 1982 on 06.06.14 at 12:47 am

If unreal prices and possible rate increases aren’t a big enough threat, how about price hikes in utilities and taxes as a final finishing move for those most vulnerable? How about ongoing maintenance cost, too? Here in northwestern Ontario everything seems to be between a 40-50% increase spread over 4-5 years. Examples? Sewer and water 50% over 5 years to cover the shortfall in reserves to replace aging infrastructure. Hydro 42% over 5 years (probably to ensure their sunshine list remains competitive). Natural gas 40% increase….immediately. MPAC tax assesmemt, and thanks to fools, a 42% increase from 2008 to 2012 to be phased in accordingly (for my property anyway). I also say maintenance because 95% of people or more who buy houses do not realize or think of how they will be paying to re-shingle their roof or replace broken appliances or heating systems. Instead they worry about flooring or granite countertops. Thanks HGTV and DIY sponsored by RBC and Rona. These hikes will be a few hundred per month for some properties and might exceed rate hikes. Well fixed income seniors and over extended virgins….it’s wham, wham, wham, BAM!

#105 bob on 06.06.14 at 1:17 am

just to add some counter points to your argument Garth, did you hear about the how Alibaba is prepping its employees to buy real-estate in safe havens like Vancouver when they IPO?

http://www.theglobeandmail.com/report-on-business/international-business/alibaba-preps-employees-for-40-billion-windfall-after-ipo/article18991738/

#106 North Yorker on 06.06.14 at 1:27 am

According to statcan 43% of homeowners are mortgage free in Canada compare to 30% in the US. If our average home price is more than twice as in the US, how is it possible? I guess we are richer than we think!

#107 whatever on 06.06.14 at 1:31 am

I like these trend analysis.

Ok a shack will cost 2 million (1000sqft). Hum how much will a factory cost , 40000 sqft …. 80 millions just to have a small factory. Humm how much in detroit, 500,000.

OK sell and move detroit and you just made the company 79.5 million. Cheaper labour. So at the end of the day everyone goes on wealthfare but they all have huge loans and a house,,,, Until the banks and repo man comes and take it away

#108 Andrew Woburn on 06.06.14 at 1:41 am

#64 Keith in Calgary on 06.05.14 at 10:17 pm
In fact, there are no “real” jobs on the island to speak of……real estate is for sale and rent everywhere you look……commercial buildings are for lease on every street. The economy sucks trucker ass.
========================

Which is why you would expect a business-oriented government to encourage businesses to move computer-linked back office operations to the Island to take some pressure off Vancouver real estate. But no, they let ferry prices soar so it becomes harder and harder to run any kind of business here except tourism. BC doesn’t have a lot of flat space for development so pricing the Island too high for business is just demented.

#109 BillyBob on 06.06.14 at 3:10 am

@Joe,

What fear-mongering nonsense. I’ve been living in the Middle East for years, and traveling to all these dangerous places you mention. According to most people you talk to in Canada, I live in a compound, cowering in fear of a bomb going off, while all the women wander around in burkas. Which is nothing remotely true. Such ignorance.

Ask the good people of Moncton how “safe” they feel today in their “civilized” country.

@Ken Lovegrove,

My employer flies to 142 destinations worldwide, and by far, the most duty-free sold is on the Dubai-Lagos sector. Of ANY flight, anywhere. There is a tremendous amount of money in Nigeria – it’s just not in the hands of very many. And I wouldn’t want to live there, can’t even leave the hotel on layover and have an armed escort to/from the hotel (insurance requirement). But the idea that Africa is poor and pitiful is only one side of the story.

#110 Freedom First on 06.06.14 at 4:09 am

#62 Smoking Man

That’s hilarious! Thanks for the laugh!

#111 Hillbilly on 06.06.14 at 4:10 am

Kris – comment # 9

Patient in Richmond – comment # 14

There are 1.351 billion Chinese as of the 2012 census, not 3 billion.

Ever heard of Google or a web search?

Simpletons !

#112 Fortune500 on 06.06.14 at 4:34 am

I have over 50 countries under my belt, some of which I have spent considerable time in. What I have noticed, especially in the last 10 years, is how much Canadians tend to undervalue the quality of life in other countries, and overestimate it in their own.

Canada is a beautiful country with a lot going for it, but to believe that people will be coming on-mass no matter how expensive housing gets is just ignorant. Turn off Fox and HGTV and go explore.

#113 Alicia on 06.06.14 at 6:29 am

Manufacturing is a male dominate job. Good riddance men are losing their jobs. They deserve to lose their jobs for exploiting women all over the years.

Toronto is the BEST place for young women like myself. I have no sympathy for any misogynist who lost his job because he is of no use to the workplace.

The blogger and his minions complain that they can’t afford a house in Brampton.

I have one suggestion- MAN UP and face reality- men with no education in the manufacturing sector have little to offer to the Canadian economy.

Many of my female colleagues in their 30s already have Masters and Doctorate degrees. All of them already own a home and a condo with their jobs.

Men dominate these doom and gloom blogs because these old fashioned obsolete men are bitter that the modern women in Canada and USA are empowered, more educated and beautiful than the oppressed women of past generations.

No different than a Muslim cleric who preaches hate against women who dress without the authoritarian regime of male patriarchy.

Who are men to judge on the way a woman dresses, or complain that they are jobless while educated women like myself already own a townhouse in Toronto.

#114 saskatoon on 06.06.14 at 6:53 am

#91 Alicia

yikes.

#115 TheCatFoodLady on 06.06.14 at 7:01 am

#91 – Alicia:

If you have to hold up greater ‘beauty’ as a bragging point for Canadian & American women – you’re not ‘free’.

If you have to hate on men for sins of the past – you’re bitter & twisted, not empowered.

Empowered women or men for that matter, don’t need to engage in gender wars or use the whine of exploitation by the other sex.

Get over it & worry about what you as an individual are doing, not what the other sex may or may not be doing. Unless you’re still happy to give the other sex that power over your life.

#116 eddy on 06.06.14 at 7:33 am

#43 Smoking Man on 06.05.14 at 8:59 pm

New Brunswick cops asking everyone to turn on the outside lights to help them put a bullet in that phycos brain…


he’s not a psyco he’s a cop playing the role of a psyco,

what’s the point? if you want a hunting rifle, you will need a psychological clearance, hopefully you’ve never been prescribe anything, ever. perhaps a review of everything you’ve ever typed online

because

‘everyone saw that psyco on TV”

turn it off

#117 Carly in Cabbagetown on 06.06.14 at 7:35 am

#112 Alicia

Thank you so much for telling it straight, Alicia!

Most of my women friends are not so direct, but you are completely correct.

I don’t hate men, but way too many are letting themselves become dinosaurs, not adapting to a new paradigm.

My university classes were all at least 65% female, and of those the top performers included hardly any men. The workplace of the future, the best jobs will soon all be going to the best people, who are mostly women, not “the old boys club” which is what we still have. Most senior executive males still get there without any merit, just by connections and patting each other on the back. Women are changing that.

It’s especially sad to see how the most loser-men try to create competing mythology about how “education is bad” and such nonsense, a desperate attempt to protect their unearned positions of privilege. When women show they are superior at a given standard, these cowards don’t work harder, they just try to change the standards!

At least they are not doing what that disaffected young male Justin Bourque did, but they are really not far from him on the continuum of behaviour. The escape into radicalism and doomer conspiracy is a growing problem for males.

Men have also attempted to medicalize their inability to adapt -witness the explosion of “ADHD” diagnoses, again blamed on the school system and primarily a male problem. “ADHD”, does it really even exist? Use your common sense, see who profits from this kind of overdiagnosis: males wanting to cling to power and have their school marks bumped up, and males profiting from big pharma.

http://www.amazon.com/ADHD-Does-Exist-Richard-Saul/dp/006226673X

I’ll bet the readership of this blog is about 80-90% white male, for sure.

Men, if you can’t hack it, look in the mirror before you come up with your stupid conspiracy theories or pick on the success of women who are buying their own homes, thank you very much, with no need for you.

#118 Realtor # 1 GTA on 06.06.14 at 7:45 am

A few points I have noticed we haven’t discussed that may explain why we haven’t had a correction “yet”

1.

The Great Transfer of Wealth

History’s largest transfer of wealth between generations is under way, with Canada’s baby boomers expected to inherit $1 trillion over the next two decades.

http://www.tonictoronto.com/February-2014/The-Great-Wealth-Transfer/

2. Debt service ratio

5 years and counting……

#119 Smoking Man on 06.06.14 at 7:46 am

#112 Alicia on 06.06.14 at 6:29 am

Oh man, you know a big ass rebuttal coming soon..

Job numbers coming out, bit tied up…

You’re inspirational….

#120 OREA is your friend on 06.06.14 at 7:50 am

if you live in Ontario this may be of interest

Many large urban mayors are lobbying Queen’s Park for new revenue tools and an Municipal Land Transfer Tax MLTT is one they desperately want.

http://www.donttaxmydream.ca/helpstop.html

#121 pbrasseur on 06.06.14 at 7:52 am

Stock ownership currently at 50 year low

http://www.marketwatch.com/story/not-even-a-bull-market-can-interest-people-in-stocks-2014-06-05?dist=beforebell

In other words, the herd is missing the boat, yet again!

#122 T.O. Bubble Boy on 06.06.14 at 7:55 am

@ #74 Mark on 06.05.14 at 10:58 pm
“When you have CREA/TREB saying average price is up 8% year-over-year, isn’t anyone saying “hmmm… at that rate, prices would double AGAIN in 9 years”

Maybe the particular houses their members are selling have gone up, but the sales mix of houses actually being transacted has shifted quite noticeably in the past year or so.
———————————

Correct – more high-end homes in the mix is the main driver of price growth (and, from my observation, a huge number of houses with massive 6-figure renos or complete re-builds).

My point was simply: do the sheeple listening/reading the news not question these tulip-eqsue stats?

I hear far more people saying “wow, I made $100,000 on my house in the last year!” than “wow, 8% annual growth — 6% above inflation — is unsustainable, and it seems like something is wrong”.

And I’m not just talking about average joe on the street… bank economists and financial media don’t even call this out!

#123 Bottoms_Up on 06.06.14 at 8:07 am

#112 Alicia on 06.06.14 at 6:29 am
—————————————
It’s great to see misandry is alive and well on this blog. Thanks for participating, your contribution is very enlightening: you have a sick moral compass.

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

#124 Bottoms_Up on 06.06.14 at 8:09 am

#102 Setting the Record Straight on 06.06.14 at 12:47 am
————————————————————
By using the rationale behind your argument, private sector workers shouldn’t vote either.

#125 wex19 on 06.06.14 at 8:10 am

My weekly hockey game has been bringing out some different topics lately. Most people are talking about money and housing but not in the way they use to. One guy is a salesman and says no one has money. Claims that 3 of 5 Rona stores he deals with are quietly for sale with no takers. Says all five stores are broke due to construction and renos tanking.

Another guy was telling us about his wife wanting to buy a house now that baby arrived. Found a house they want and heard that the previous deal fell through on the house at 60k less than asking. Big house that was empty due to separation so why not low ball right? Well their agent said she wouldn’t put in offer 60k less due to her reputation. Since hockey buddy signed a agreement with agent to buy, he is stuck for the moment. Agent has agreed to terminate agreement but is stalling on paperwork. New agent has no problem putting offer in at 60k less.

Several houses south of Ottawa are not selling like they used to. Same old story. There are several houses over 400k that are not moving and have not moved for a year or more. Most are not budging on their price either. When you look in the back yard of several new construction houses, you see the signs of no money. Seems like home owners managed to buy the big house, but can afford to put a real deck on. They still have the builders 4 foot by 4 foot deck on. You see the cheap white plastic chairs and a bbq out in the back yard in the middle of the lawn. No deck, interlock, planters, etc. Want to bet that the basement is not finished either?

#126 Smoking Man on 06.06.14 at 8:10 am

#109 Freedom First on 06.06.14 at 4:09 am

#62 Smoking Man

That’s hilarious! Thanks for the laugh!
………….

That’s nothing, this morning I took the beast out side to do its business.

It spun on a spot no less than twenty times, lifted it’s back leg, them keeled over.. Bahahaha..

It made it self dizzy.. Then it tried to run, 45 degrees side ways then ran into the barbecue..

I laughed so hard, my mussels on the right side of my torso cramped up, I though I was having a heart attack.

It’s a full blown mental case.. Can’t wait to go home and see what it does next.

#127 Almontage on 06.06.14 at 8:16 am

I worked in R&D for Unilever for 20 years – a lot of that time I was located in the Bramalea Plant.
Bramalea got many jobs in the 90s and early 2000s when Unilever closed two US plants. At that time the Canadian Dollar was at historic lows versus the US Dollar. No longer the case.
Also Unilever has hollowed out its Canadian management structure and most supply chain decisions are made in the US now. Branch plants like Bramalea don’t have a lot of traction under a North American model of management.
Bramalea is a 50 year old plant that nees a lot of asset improvements – Unilever chose to make that investment in Independence instead.

#128 maxx on 06.06.14 at 8:32 am

I honestly don’t know what we’d do without you Garth. Thanks.

We all hear snippets of plant closings here and there, but this graph is an excellent snapshot. Wow. The end result for me is that I feel sad for the many who simply want to get on with life and cannot. This macroeconomic disaster is extremely long-winded.

People are now hedging for government risk and are not spending in many parts of the world because they have begun to wake up.

Forcing money velocity on the globe is the most destructive force ever, and not simply from an economic standpoint. Global wealth now has the worst distribution ever. Instead of a varied and healthy economy with many moving parts which could compensate for various influences, good and bad, we have excess shrinking in manufacturing, increasing job losses, therefore increasing debt and causing social instability, with our youth having the lowest optimism in history.

And still, central banks want to cheapen money. They punish responsible savers and hand pallets of cash to banks on silver platters. Practically supplicating.

But- banks and business are sitting on their cash too, and not spending. They’re doing the very same thing as savers. They’re not stupid. Their risk analysis tells them that spending is risky. Prices are too damned high and in the case of banks, the prognosis for repayment is melting each and every time another job is lost.

Vicious circle- and a fiscal black hole.

Protect yourselves.

#129 Ben on 06.06.14 at 8:32 am

Also in Montreal, here 12 months. Renting, recently saw a 5 bed renting at $1.5k/month, same road 5 bed for sale, mortgage would be (at best) $3k per month, not including property taxes!!!

It’s a market for people with severe learning difficulties who will learn a severe lesson.

#130 Ben on 06.06.14 at 8:34 am

> Many of my female colleagues in their 30s already have Masters and Doctorate degrees. All of them already own a home and a condo with their jobs.

Ok, having a mortgage and not having paid back your school debt isn’t good. But thanks for the rest of the male (sic).

#131 MikeM on 06.06.14 at 8:39 am

This is an interesting article about Home Prices:

http://www.daveramsey.com/blog/60-years-of-home-prices

#132 Ray Skunk on 06.06.14 at 8:40 am

#91 Alicia

2/10 – May get a couple of bites.

The best wind-ups on here are usually a bit more subtle. Next time, try claiming to be 26, making $250k+ and “worrying” about being given half a mil by your mommy & daddy to drop on a SFH.

#133 Smartalox on 06.06.14 at 8:45 am

@Alicia #112:

“many of my female collegues in their 20s and 30s already own townhouses and condos…”

And cats? How many own cats?

The loss of manufacturing sector jobs affects both men AND women. In my 20+ years in manufactring, probably 40% of the staff I’ve known were women, especially in comppanies that produce packaged foods, cosmetics, pharmaceuticals, but also microelectronics, and car parts.

Industries with a need for physical strength, like construction, have a lower proportion of women directly involved in production, but women do work as equipment operators, in the skilled trades, or in supervisory positions.

#134 Big Al (New) on 06.06.14 at 8:45 am

So Alicia,I’m guessing your single.

#135 takla on 06.06.14 at 8:45 am

re Alicia #112

Really,,,,your expressed opinion is wrong on SO many points…but you know what they say about opinions and A-ho;es…everyone has them
signed a proud male
Takla

#136 OttawaMike on 06.06.14 at 8:46 am

#112 Alicia on 06.06.14 at 6:29 am

Hi Alicia, Have you been trolling internet blogs for long or is this your first time?

#137 OttawaMike on 06.06.14 at 9:04 am

#99 WS on 06.06.14 at 12:29 am

Good retort. Yes you are correct, it is a complex problem as to why manufacturing has declined in Ontario and the assertion of the blog post about high RE prices is part of the problem. SW Ont has been particularly hard hit in manufacturing losses and no, high RE prices are not likely the cause there.

The fact is that the US took a huge hit under the GFC of 08 and left many workers hungry for jobs, this made their economy competitive enough to repatriate jobs. Fracking has provided cheap electricity and cheap petro chemical feed stock for manufacturing components.

The reality is that our children do not have the opportunity that was once available in Ontario. Migration west is becoming a fact of life for our young to kick start a successful career.

#138 Bubblicious on 06.06.14 at 9:10 am

Why? Because even with the cheapest money in history, consumers aren’t borrowing, aren’t spending.-Garth on Europe

But we as Canadians are borrowing and spending this cheap available money.
So, seriously, how can both be bad??

Confused

#139 Bubblicious on 06.06.14 at 9:12 am

And when that happens, the only happy people are the ones with liquid assets and no debt.-Garth

Liquid assets? You mean booze right.

#140 OttawaMike on 06.06.14 at 9:12 am

#95 Bottoms_Up on 06.06.14 at 12:03 am

US of A also has a healthy bureaucracy of public workers but hides it under the guise of military and all the other dedicated industrial complex that is dedicated to all things military and homeland security.

#141 Smoking Man on 06.06.14 at 9:14 am

#12 I hear you Roar Alicia.

 

However, you like many in the matrix are confusing the collection of obedience certificates with brains. I congratulate you and your GF on your ability to work a yellow highlighter to its full potential.

 

Modern females false sense of empowerment was programmed into to your heads by really bad Smoking Men in the back rooms of power.

 

40 years ago one man could provide for a stay at home wife, several children, easily buy a house, car, cottage. That elusive white picket fence that only millionaires can have today.

 

The Immoral Smoking Men wanting to squeeze as much juice out of the grape fruit as possible came up with a brilliant idea.  We will get two units of labour for the price of one.

 

Hence, the birth of the woman’s movement, the woman hit the job market.  Then slowly but surly wages came down, many families now work two jobs. The Smoking Men no get 4 units of labour for the price of one. The bounce was, The Smoking Men now had an abundance of fresh meat just down the hall for a little fun on the side.

 

But it get’s better.  Because Mom and Dad are to busy trying to survive, the kids are handed over to the state for their programming at age 4 now.

 

Look at them come out now. All the rage and frustration aiming their blank pistols at  big oil.

 

While the Smoking Men feast in behind the curtains…..

A toast to your  great  success Alicia….

#142 Rational Optimist on 06.06.14 at 9:16 am

Most manufacturing in this country is in Ontario. The trend in your graph of job losses accelerated around 2003. We know what happened in Ontario in 2003.

Government plays only a part, but Ontario’s provincial government the last decade inspires confidence in no one, and has done a lot to drive out business. A lot of the reason states like Missouri is more attractive to business than we are is because their governments weigh competing goals- a very big one of which is economic prosperity. In Ontario, our government seems to take for granted that we are special and everyone wants to be here, and forgets that every unnecessary piece of regulation and intrusion makes this jurisdiction less attractive for business.

Health and safety regulations are important. Environmental protection is important. Good wages are important. So is the ability to continue to make things of value. We just have to find a new balance.

All this to say, there are a lot of reasons why the choices in Ontario are not good right now, but there may be the possibility of a turn-around if the government changes.

By the way, I love the Alicia character. She’s my favourite I think since the Smoking Man character. Keep up the good work, very funny stuff.

#143 frank le skank on 06.06.14 at 9:18 am

#112 Alicia on 06.06.14 at 6:29 am

DELETED

#144 sotiri on 06.06.14 at 9:20 am

“In the U.S., the Labour Department reported that employers hired a net 217,000 people in May, more than the 215,000 that economists had forecast in a Bloomberg survey. The world’s largest economy created a revised 282,000 new jobs in April. The release also showed that the unemployment rate unexpectedly stayed at 6.3 percent last month.”

Canadian unemployment rate 7.0% and climbing…

Garth these numbers prove exactly what you are saying…everything is becoming so extremely expensive in Canada that workers will not be able to survive with the same income US workers can. Higher labour cost for businesses is pushing companies to relocate to US as a result our unemployment rate is steadily climbing.

#145 frank le skank on 06.06.14 at 9:27 am

#129 frank le skank on 06.06.14 at 9:18 am
#112 Alicia on 06.06.14 at 6:29 am

DELETED
——————————-

Oh shyte, now I’m on the list!

#146 Bottoms_Up on 06.06.14 at 9:34 am

#116 Carly in Cabbagetown on 06.06.14 at 7:35 am
—————————————————
Another misandronist. Sickening. The attack on men is alive and well.

#147 Smoking Man on 06.06.14 at 9:37 am

#144 frank le skank on 06.06.14 at 9:27 am

#129 frank le skank on 06.06.14 at 9:18 am
#112 Alicia on 06.06.14 at 6:29 am

DELETED
——————————-

Oh shyte, now I’m on the list.
……………

Don’t worry you’re in good company…

#148 OttawaMike on 06.06.14 at 9:41 am

#125 Smoking Man on 06.06.14 at 8:10 am

I have recently been considering acquiring a wiener dog or poodle but now you’ve got me researching Pugs.

#149 MEANWHILE IN FRANCE on 06.06.14 at 9:48 am

The non/marginal interest bearing savings accounts in Europe are adding up to staggering amounts.
In Austria alone, a small country with barely 8 million citizens, banks are sitting on 150 BILLION Euros without having to pay much interest, if any.

I am sure some “Investment advisers” are just itching to get their hands on that loot, one way or the other.

People live differently over here, hard to explain, you have to experience it.

http://theceliachusband.blogspot.fr/2014/06/jarnac-market.html

#150 Ralph Cramdown on 06.06.14 at 9:55 am

#141 Rational Optimist — “A lot of the reason states like Missouri is more attractive to business than we are is because their governments weigh competing goals- a very big one of which is economic prosperity.”

Well, whatever they’re doing, it isn’t working. Missouri ranks 36 out of 51 states+DC in median household income.

en.wikipedia.org/wiki/List_of_U.S._states_by_income#States_ranked_by_median_household_income

Meanwhile, Statscan says we’ve created net zero full time jobs in this country in the last year, but lots of part time jobs. Another year like that and somebody’s going to have trouble getting re-elected.

#151 Bottoms_Up on 06.06.14 at 10:14 am

#147 OttawaMike on 06.06.14 at 9:41 am
—————————————–
Pugs are actually quite an intelligent breed, the few I’ve known have been great dogs. Watch out for their anal gland though….

#152 Old Man on 06.06.14 at 10:20 am

I am sorry girls but my dance card is all filled up for now. No need to wait in line for me, and you will be sorry what you have missed.

#153 Smoking Man on 06.06.14 at 10:21 am

#149 Bottoms_Up on 06.06.14 at 10:14 amPugs are actually quite an intelligent breed, the few I’ve known have been great dogs. Watch out for their anal gland though….
………..

Poodles are best, they don’t shead.

Get a female what ever bread. They are easy to train, well behaved, you don’t feel weird giving it affection..

Plus who what’s the see that lip stick trick boy dogs are famous for.

I suggest poodle female…

Name it Alicia….

#154 maxx on 06.06.14 at 10:27 am

#20 Seaforthdoctari on 06.05.14 at 7:52 pm

“I used to be in the design business; packaging, promotional material, etc… but left the industry a few years ago as I saw billing rates plummeting across the country.”

Smart.

“The constantly shrinking selection of clients being chased by an ever increasing number of design firms was having the inevitable effect.”

Yes…..and now creditors of all stripes are eating each others’ lunches. The low-hanging fruit is (for now) mortgage debt, but even that is becoming thin on the ground.

#155 sciencemonkey on 06.06.14 at 10:27 am

@99 WS
True, if an employee goes to their boss and says, “look, I’m doing a good job, but my salary does not compare well to the cost of living,” the boss will not care, especially if there are plenty of people willing to fill that job at that pay.

Nevertheless, the worker eventually forgets the fear of job loss. Cognizant of the low pay and of the zero chance for good raises, she slips into the completely rational decision to do just enough half-assed work to keep her job.

http://www.balloon-juice.com/2013/06/24/they-pretend-to-pay-us-and-we-pretend-to-work/

Productivity goes down, business is not competitive, and the Ontario economy suffers as it deserves.

#156 Joe2.0 on 06.06.14 at 10:29 am

108 Billy BoB

My point is regarding the immigration of Chinese and other ethic groups to Vancouver and certain parts of the USA, Australia and the decision making process.

#157 NorthOf45 on 06.06.14 at 10:29 am

Blam!

http://www.theglobeandmail.com/report-on-business/economy/housing/cmhc-drops-mortgage-insurance-for-condo-developers/article19040448/

#158 Adriana Lima on 06.06.14 at 10:36 am

Carly & Alicia!

What’s wrong with you both?
Why so much hate towards men? I love them!!!
They are fun, they leave their socks all over the place, they cannot multitask, they don’t listen to us, they say what they really think and they like sex! So what?
C’mon, there are lots of good men out there, get out of your “townhouse” and go have some fun!
Now I know why Canadian men like so much to marry us, (Latinas) Yes, we are educated, we know how to cook, we know how to take care of our children, we know how to take care of our home, we are feminine and we respect them. Stop trying to feminizing our boys, I don’t want to live in a society that suffocates all the good aspects of masculinity! VIVE LA DIFFERENCE!!!

#159 drooski on 06.06.14 at 10:36 am

this reminds me of the conversation i had a few months ago with my brother in law. he looked at me at said that in 20 years his 1.8 million or whatever it is house near the cricket club in TO will be worth $30 million. He said that was based on trends.

I did a spit take.

#160 Mr Buyer on 06.06.14 at 10:37 am

On another note….
I am in the market for a new or good condition used scintillator so I can carryout in house monitoring of the cesium 137 levels in the kids milk here in Japan as well as other contaminants in other food items. If there is anybody out there with a unit lying around I am willing to depart with a certain amount of cash but not too much because I am cheap. I am looking for a person that used to use it but it is just lying around not doing anything. I am willing to sell it back to you in the future for the same price if the need arises again to have it( provided of course I haven’t destroyed it trying to figure out how to used it or my kids haven’t re-purposed it or I haven’t fried it with unexpectedly blazing hot samples).

#161 Happity on 06.06.14 at 10:50 am

“And if you can manufacture soup for the North American market anywhere you want, why locate in a place where workers need to earn double the money?”

That has been the line since western governments changed the rules for to open Asia, or Mexico with nafta, eventually everyone in the world is ground into serfs.

#162 Stickler on 06.06.14 at 10:53 am

So, stop exporting raw resources. Do the processing in Canada, add value, boost jobs, GDP & export $

Problem solved.

Next?

#163 Lurcher on 06.06.14 at 10:54 am

I was talking with a family acquaintance over the weekend and he said 20% of the workforce at his Richmond BC office was just laid off (100 people). He and wife have just bought a house in W.Van and he was very worried. I think he is still worried. We often never hear about these layoffs at small to middle sized cos. but I suspect it happens quite regularly.

#164 Rational Optimist on 06.06.14 at 10:54 am

150 Ralph Cramdown on 06.06.14 at 9:55 am: “Well, whatever they’re doing, it isn’t working. Missouri ranks 36 out of 51 states+DC in median household income.”

At 6.6% and on a downward trend, their unemployment rate is better than every province east of Manitoba.

“Meanwhile, Statscan says we’ve created net zero full time jobs in this country in the last year, but lots of part time jobs. Another year like that and somebody’s going to have trouble getting re-elected.”

I expect you’re right about that. Unfortunately, here in Ontario we’ve been shedding good quality jobs for over a decade now, but next week’s election might be too soon for voters to figure that out.

#165 not 1st on 06.06.14 at 10:55 am

Garth might as well move over to facebook cause his posters are just all talking to each other now.

Anyway, to #113 Alicia, you have some valid points about the workforce and its ugly past and present.

BUT, don’t get too complacent because manufacturing is just the canary in the coal mine and it happens to be hitting men more than women. A masters and a doctorate mean nothing today. Technology and automation are coming for your jobs too no matter how highly skilled you think you are.

#166 Nemesis on 06.06.14 at 10:58 am

#YouCanLearnALotFrom’OlLydia’ #JustCheckOutHer’Encyclopedia’

http://youtu.be/n4zRe_wvJw8

#AlwaysLetThePugDrive[OrHe’llSing]

http://youtu.be/YYr_iVitR-4

#167 Angus on 06.06.14 at 10:59 am

Central bank of mexico cut rates from 3.50% to 3.00%due to worse than expected economy blamed it on the weather due to unusually hot weather

#168 Dean Mason on 06.06.14 at 11:02 am

To #144 sotiri

If the U.S. economy is getting better and the U.S. job numbers are so good then why are U.S. bond yields much lower in 2014.

There is no U.S. 30 year 3.92% bond yield or 3.01% 10 year U.S. bond yield. today.

They are down to 3.41% and 2.57% respectively, 13.01%, 14.61% less annual interest yield.

Wait until there is a 25% to 35% drop in equities in the next 6 months to 12 months.

#169 Joe2.0 on 06.06.14 at 11:03 am

89 Bottoms_Up

Check out USS Ronald Reagan radiation sickness.

Or type in radiation plume Fukushima, and go from there.
Make up your own mind.
By ignoring it it won’t go away.

Do some research.

#170 TO Renter on 06.06.14 at 11:06 am

#149 Bottoms_Up on 06.06.14 at 10:14 am Pugs are actually quite an intelligent breed, the few I’ve known have been great dogs. Watch out for their anal gland though….
——–
Actually they are way down at #87 on the dog intelligence list (Border Collie at #1). I wouldn’t call ours smart. He won’t fetch. He doesn’t come when called. He chases cars. He backs out of harnesses because he has no neck. But he’s an amusing clown with a great head tilt and snores like a trucker. Only plastic surgery in the family (ingrowing eye lashes). Much loved.

#171 Aggregator on 06.06.14 at 11:12 am

#157 NorthOf45

Blam what? lol Developer insurance is 0.1% of CMHC's insurance portfolio. Nothing to see here other then another PR stunt to look prudent to the pubic while the next biggest scheme is underway.

#172 TO Renter on 06.06.14 at 11:20 am

For SM (You wanna move to Long Branch? You wanna go to Vegas?):
http://www.youtube.com/watch?v=sVMhuiHm50I

#173 saskatoon on 06.06.14 at 11:34 am

#157 NorthOf45

the article you posted says:

“CMHC also said that it is tightening up its standards for homeowners who have a down-payment of more than 20 per cent. Mortgage insurance is only mandatory when a federally-regulated lender sells a mortgage to someone who has a down-payment of less than 20 per cent.”

how and why is it “tightening up” for those who have 20%+?

#174 Nemesis on 06.06.14 at 11:39 am

#PugAddendum #TheyMakeGreatLibrarians,Too

http://www.pentictonherald.ca/news/article_cf83b9c8-ed39-11e3-b0e1-0017a43b2370.html?mode=image&photo=0

#175 Tony on 06.06.14 at 11:41 am

Re: #144 sotiri on 06.06.14 at 9:20 am

More people were entering the workforce in Canada last month.

#176 Dean Mason on 06.06.14 at 11:47 am

CMHC is ending the financing of new condos to condo developers. Just now from BNN.

#177 kommykim on 06.06.14 at 11:50 am

RE:#125 wex19 on 06.06.14 at 8:10 am
Big house that was empty due to separation so why not low ball right? Well their agent said she wouldn’t put in offer 60k less due to her reputation.

Realtors are required to present ALL offers to the seller. They should insist (record the conversation) and threaten to report her if she fails to comply.

#178 Gregor Samsa on 06.06.14 at 12:03 pm

Excellent post Garth. I think we agree that in the end, it doesn’t really matter what happens to interest rates. If rates rise, the correction comes sooner and faster. If rates stay low, the correction comes a bit later and slower.

Canada has long been due for it’s day of economic reckoning. I predicted 5 years ago that Harper’s economic policies would lead us to ruin, but where I was wrong was how long he would be able to keep the game going. I think you were also predicting things would be in correction mode by now.

Now, I think think there is enough momentum to take us through 2015. You have to look at the factors that are keeping things going right now, and none of those indicators are changing:

1) People still lust for homes. People that don’t have them want them. People that have them want bigger and better ones.

2) Debt is still cheap, and looks like it will be for the foreseeable future.

3) Resource industry is still chugging along.

4) Immigration policy is keeping lots of people coming into the country. Very low rental vacancy in many cities.

#179 -=jwk=- on 06.06.14 at 12:09 pm

@ #34 you have obviously never been to Missouri. Multi family residences are the norm, and the definition of ‘family’ is open to interpretation.

#180 Cici on 06.06.14 at 12:09 pm

Canada employment numbers continue on their downwards projectory, deviating from economists’ more optimistic projections:

http://www.vancouversun.com/business/Unemployment+rates+Canada+rise/9914113/story.html

#181 pinstripe on 06.06.14 at 12:17 pm

Many small business owners are not hiring due to the work ethic demanded by potential job candidates.

The job candidate demands a work balance, but the definition means that an 8 hour day includes 4 hours of work and 4 hours of leisure to do personal stuff of the candidates choice. The work/leisure must be random, that is if a friend tweets the tweet has priority. Also, flex hours mean that an 0800 am start to a job may include showing up at 1200. No show days are very common. I hear many stories that this type of work ethic is very common amongst civil servant jobs and no one can be dismissed for either poor performance or no performance.

These small business are willing to take on whatever jobs they do but do the job by themselves as the business owner.

#182 Paul on 06.06.14 at 12:18 pm

#92 Another recent Canadian on 06.05.14 at 11:58 pm

Hey recent canadian, I also recently moved from NYC to Montreal. The rent here is so cheap. I had the exact same thought as you, high real estate prices eventually render labor uncompetitive. Read Michael Hudson, he talks about the ongoing battle between financial capital and industrial capital.

———————————————————

I’m adding Michael Hudson to my list of authors I need to read. Agreed on cheap renting opportunities in Montreal. In Brooklyn a two family home going for 800k would allow you to rent the 2nd floor at $2500, here a 800k duplex will yield $1000 for the 2nd floor apartment (in Rosemont on Beaubien), plus higher property taxes and no income tax deductions. The quality and quantity of places to go out to in Montreal pales in comparison to most areas in NYC, why the premium?

#183 Nobbo the Neutral on 06.06.14 at 12:21 pm

Ref Post 141 – Smokin’ Man

To add to your polemic, you might want to consider too how, by increasing the candidate pool by 100 percent, you could effectively skim right off the top the best and the brightest of both groups. Simply put, you can hire the smart males and the smart females although Alicia may think “smart males” is an oxymoron.

Where your argument could be flawed though is as follows: did more women start working and as a result, inflation occurred or did inflation occur and this prompted more women to enter the work force? Did they cause the change or did they respond to a need? Perhaps the answer could be found in studying productivity changes but that is beyond my knowledge and skill.

Until you establish which of the two factors explains the increase, your argument is just a series of disconnected statements that cannot logically prove your thesis.

#184 BillyBob on 06.06.14 at 12:24 pm

“108 Billy BoB

My point is regarding the immigration of Chinese and other ethic groups to Vancouver and certain parts of the USA, Australia and the decision making process.”

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

My point is that the world is not quite the scary place that you and Fox News try to make it out to be. Not everyone is dying to move to Canada or the good ol’ USA. Life isn’t an after-school tv movie.

The fem-trolls are amusing! I almost laughed out loud at the earnest attempt to equate worth with a post-grad degree or a condo in Toronto! Well, if they’re interested in taking over a man’s world, I say they can have it. Enjoy your shorter, more violent lives.

#185 Nemesis on 06.06.14 at 12:33 pm

#YouGetASoupKitchen #TheyGetABanquet #Here’sHowItWorks #Privatization:ATimelyThinkPiece

[Salon] – One percent’s twisted new heist: What’s really behind privatization

“As most experts and layman enthusiasts will tell you, there’s no one, single explanation for the past 30-plus years of growing economic inequality. Its drivers are multiple and separating one from the other is often quite complicated. Low taxes on wealthy individuals and corporations, the gutting of labor unions, the increased mobility of capital, technological gains, overly protective intellectual property law; the list goes on.

In fact, here’s another one to add to the list: privatization. According to “Race to the Bottom: How Outsourcing Public Services Rewards Corporations and Punishes the Middle Class,” a new study from In the Public Interest, a think tank focused on how privatization affects the economy, the routine practice of outsourcing government functions is another important reason why the middle class is shrinking as those at the very top reap more and more of the fruits of our economy. To explain how that is — and why it’s important that people committed to economic justice push back against the practice — Salon recently spoke with ITPI research and policy director Shar Habibi. Our conversation is below and has been edited for length and clarity.”…

http://www.salon.com/2014/06/06/one_percents_twisted_new_heist_whats_really_behind_privatization/

#186 Mark on 06.06.14 at 12:41 pm

“Many small business owners are not hiring due to the work ethic demanded by potential job candidates.”

Just because a business is ‘small’ doesn’t mean that a small business owner has an inherent right to pay less than a large business, or demand more from his/her employees. The proprietary advantage of small business should be through flexibility and providing a unique good or service. Not by merely being a bottom-feeder on the labour pool, expecting someone to do 8 solid hours of work and only be paid the equivalent of 4.

Too many small business owners, IMHO, have their heads in their asses, and now many of them are complaining bitterly that the last bastion of slavery, the TFW program, is under attack and at serious risk of being severely curtailed.

#187 Old Man on 06.06.14 at 12:47 pm

The Liberation Movement For Women – This was a project of social engineering and in the words from the Rockman, it was executed to get women into the workforce in order for them to become tax slaves. I liked it myself because us men had a field day, bravo for free love!

#188 DM in C on 06.06.14 at 12:53 pm

Just went to do some online banking and noticed the banner on the landing page at Scotia — 5yr term mortgages at 2.47%. I thought we had a good 4 yr term @ 2.99%

Virgins to the altar……

And realtors, not everyone here are basement dwelling renters — we are just aware of what’s going on around us. We took the red pill.

#189 Nemesis on 06.06.14 at 12:54 pm

#ComicRelief #WhenHarryMetSally #ICan’tBelieveTheyAteTheWholeThing

“My point is that the world is not quite the scary place that you and Fox News try to make it out to be.” – [email protected]#184

Just between the two of us, CaptainBillyBob… TruthIsFrequently, if not quite always, StrangerThanFiction…

[CBS] – Indiana Couple Adopts Pugs Who Ate Previous Owner

OMAHA, Neb. (CBS/AP) Harry and Sally, two small pugs, didn’t just eat the homework, they ate their owner.

http://www.cbsnews.com/news/indiana-couple-adopts-dogs-who-ate-previous-owner/

#BonusZen #OrWhyYourPug’sVetRecommendsAlkaSelzter

http://youtu.be/VFKifpMtlNs

#190 sciencemonkey on 06.06.14 at 12:59 pm

@181 pinstripe

Please see my post at @155 for an explanation.

#191 Nemesis on 06.06.14 at 1:13 pm

#HowOutSourcingWorksInBC’sForests #HumanTrafficking&SlaveryOnYourDime

[CBC] – 55 tree planters win $700K over ‘slave-like’ discrimination in BC: Human Rights Tribunal rules Khaira Enterprises racially discriminated against Congolese workers

http://www.cbc.ca/news/canada/british-columbia/55-tree-planters-win-700k-over-slave-like-discrimination-in-b-c-1.2652622

#192 Smoking Man on 06.06.14 at 1:15 pm

#167 Angus on 06.06.14 at 10:59 am

Central bank of mexico cut rates from 3.50% to 3.00%due to worse than expected economy blamed it on the weather due to unusually hot weather.

It’s called Currency Wars.. Canada next..

#193 Dual Citizen In Canada on 06.06.14 at 1:19 pm

#158 Adriana Lima on 06.06.14 at 10:36 am
Just to ensure I stay on topic, I rather lust for Adriana Lima than a house. Just remember, there is always a chance of being Bobbitized by having either one.

#194 O'Leary says Don't buy real estate on 06.06.14 at 1:21 pm

https://ca.finance.yahoo.com/news/real-estate-crappy-investment-shark-tank-pro-212328020.html

#195 Sheane Wallace on 06.06.14 at 1:23 pm

Canada adds 28,500 part-time jobs, but lose as many full-time workers

https://ca.finance.yahoo.com/news/canadian-press-newsalert-unemployment-rate-rises-7-0-123433064.html

sh.tty jobs are here to stay. As we lost competitive edge what is left to do? Low paid services, retailer and some construction work.

Note that this is direct result from the capital miss-allocation that accompanies the credit and construction boom. As result all money flowed into non-productive activities which significantly helped in reducing any competitive edge we had left/if any. No investment in leading edge technology and R&D.

Yes, the fact the highly qualified and productive people are leaving Canada today which will have horrific consequences in long run is direct result of the housing mania. This is how majority of idiots impact the life of the few capable (it is a fact that 10 % of the population that is highly qualified and skilled determines the degree of economic development of a nation, everyone can work in Tim Horton’s).
Just look at Germany and Merkel and then compare to Canada.

Godspeed in servetitude.

#196 Toronto_CA on 06.06.14 at 1:31 pm

“Full-time employment dropped by 29,100 in May while part-time positions increased by 54,900, Statistics Canada said. That’s in line with the trend over the last 12 months where all the job gains have been in part-time work.”

Pretty much says it all, right? Would you like fries with your part-time Canadian job? The labour participation rate is now at 66.1 per cent, the lowest since November 2001. (still higher than the USA, but at least they are trending in the right direction with ~200,000 jobs a month being added in the last year).

#197 Old Man on 06.06.14 at 1:35 pm

#192 Smoking Man – Mi denero es seguro en Mexico como no pagan impuestos.

#198 blah blah blah on 06.06.14 at 1:53 pm

The thing that’s being missed is that housing is affordable for the civic service elite who make double and triple the average Joe. These people don’t have to save money for retirement…and this the take home pay is far higher than anyone else. We saw an example of this when impoverished Jenny Kwan in Vancouver’s NDP bought a $2 million dollar home on Vanc west side.

As well we see the money laundering coming in from dictatorships and despotic regimes around the world. Call them HAM SAM or BAM BAM BAM , it doesn’t matter. These are crooks who have stolen huge sums from government posts and corruption and are allowed to bring the money into Canada no questions asked. They don’t care what it costs, they just want a foot hold in Canada where they can’t be extradited for their crimes.

When civic servants awash in easy money couple with crooks from overseas who come with untaxed wealth form over 20% of the population , it’s easy to see where the upward pressure on housing is coming from.

Yes of course the locals are frightened and being herded in the wrong direction, but the fast money from civil servants and money dumping from crooks is forcing the prices up fast. Maybe something should be done about this, other countries have already, Aussie, Singapore for example.

Lets not wait for fast money to create this for Canadians.

https://twitter.com/Independent/status/474081765410480129/photo/1

Low rates, easy credit and dumb buyers did this. Public servants and immigrants are not the enemy. — Garth

#199 Bottoms_Up on 06.06.14 at 1:56 pm

#169 Joe2.0 on 06.06.14 at 11:03 am
—————————————
Ok I did your suggested research and came up with this article:

http://nypost.com/2013/12/22/70-navy-sailors-left-sickened-by-radiation-after-japan-rescue/

It appears to me that you need to know about a basic fundamental fact with respect to radiation:

It’s potency decreases based on the square root of distance from the source.

Given that the source is Japan, the dilution of it is enormous, and the proximity to the source material of Canadians being exposed is large.

That is a recipe for extremely low potency, and therefore there is no risk (unless of course you happen to be an American aboard USS Ronald Regan that was in Japan to help immediately after the disaster)

#200 Tci on 06.06.14 at 2:04 pm

Hi Garth, agree with the logic but the play is short Canadian dollar which has worked out well and should continue. $0.75 CAD is needed to help manufacturing as commodity side of economy slips. Need sub $80 oil for sub $0.80 cad.

Real estate crash in Toronto,Vancouver Calgary tougher, in particular Toronto gaining enough density to become a micro real estate market like London is to UK i.e. London outperforms the rest of England for several years.

#201 Doug in London on 06.06.14 at 2:19 pm

About a month ago I posted a comment about how our high housing costs in Canada were bad for business and another commenter expressed doubt of this idea. Well, connect the dots. If the decision were based solely on economics, I would much rather set up a business in Independence rather than Brampton. As for building a large part of the national economy on selling each other expensive houses, it seems like we in Canada have won the battle but lost the war.

I’m sure glad I have investments other than housing (some of which have performed quite well), am debt free, mobile, and have a valid passport. While it’s not necessarily easy for a Canadian to get a job in The States, it still is a possible option. Say, I wonder if that Caterpillar diesel locomotive plant in Muncie, Indiana(which took jobs from London) is looking for skilled people?

#202 };-) aka Devil's Advocate on 06.06.14 at 2:31 pm

#177kommykim on 06.06.14 at 11:50 am
RE:#125 wex19 on 06.06.14 at 8:10 am
Big house that was empty due to separation so why not low ball right? Well their agent said she wouldn’t put in offer 60k less due to her reputation.
Realtors are required to present ALL offers to the seller. They should insist (record the conversation) and threaten to report her if she fails to comply.

The Listing Agent, but not the Selling Agent, must present to the Seller all offers they are in receipt of.

A Selling Agent is entirely within their right to refuse to work with a Buyer who, in their sole opinion, is unreasonable and might adversely affect the Agents reputation, provided they have not entered into an Exclusive Buyers Agency Agreement with that Buyer.

In the case of the matter you refer to it is the Selling Agent (proposed agent for the buyer) who is refusing to write what they consider to be too low an offer.

REALTORS® need to maintain a good working relationship and reputation with their peers. Imagine you were represented by one who had a poor reputation amongst his/her peers, especially, in a competitive offer situation. The other REALTOR® might advise their client not to take your offer so seriously as that prepared and presented by an agent(s) of better reputation. Trust me it happens more than you know.

#203 sotiri on 06.06.14 at 2:42 pm

Kevin O’Leary: Real estate a “crappy investment”

https://ca.finance.yahoo.com/news/real-estate-crappy-investment-shark-tank-pro-212328020.html

#204 Old Man on 06.06.14 at 2:50 pm

Of course the economy in Mexico is slowing down as its all about the new National Tax Act as at January 1, 2014. I spent hours reading it and what a nightmare. Now for foreigners who own property there you are going to be hammered. Sat is now tracking all means of money transfers at modest levels that will be reported. Lets say you own a property and stay for 5 months and rent it out for 7 months at $1,000 per month through the net or a property manager. You now owe to Vat and Sat $410; pay, go to jail, or have the property seized. There is a 5 year rule for a capital gains exemption, but what if you have not lived there for most of the year. In order to sell you must get a release from the original closing Notary, but if he cheats is personally responsible for the capital gains tax now. Many will not sign this release or upon a sale you pay the tax with no exemption anymore.

#205 Doug in London on 06.06.14 at 3:02 pm

Strange how Tim Hudak, in his speaking about what makes Ontario uncompetitive and unable to attract or retain jobs, never mentioned the effects of high housing costs. Does his one million jobs plan include some means to make housing sensibly priced?

#206 Blacksheep on 06.06.14 at 3:05 pm

“It’s called Currency Wars.. Canada next..”
————————————
It’s a race to the bottom.

#207 Reasonfirst on 06.06.14 at 3:19 pm

Paul on 06.05.14 at 11:11 pm
#28 Victoria Real Estate Update on 06.05.14 at 8:18 pm

Thats my neighborhood. What about the other 1/2 dozen that have sold in the past 2 weeks?

Paul – if you have sales info why don’t you tell us about them? INFO does a lot of work already.

#208 kommykim on 06.06.14 at 4:01 pm

RE:#202 };-) aka Devil’s Advocate on 06.06.14 at 2:31 pm
#177kommykim on 06.06.14 at 11:50 am
RE:#125 wex19 on 06.06.14 at 8:10 am
A Selling Agent is entirely within their right to refuse to work with a Buyer who, in their sole opinion, is unreasonable and might adversely affect the Agents reputation, provided they have not entered into an Exclusive Buyers Agency Agreement with that Buyer.

It sure sounds like it to me that the buyer has entered into an Exclusive Buyers Agency Agreement with the agent. See Wex19’s post #125:

“Well their agent said she wouldn’t put in offer 60k less due to her reputation. Since hockey buddy signed a agreement with agent to buy, he is stuck for the moment. Agent has agreed to terminate agreement but is stalling on paperwork. New agent has no problem putting offer in at 60k less. “

#209 Nemesis on 06.06.14 at 4:02 pm

#FridayFun. #VivaLasBandidasLatinas

http://youtu.be/gEoz9mpxBVg

#210 Tim Hortons on 06.06.14 at 4:12 pm

88% of the new jobs created over the last year went to TFW’s.

#211 Hillbilly on 06.06.14 at 4:16 pm

Fortune 500 – comment # 112

Absolutely correct. This has been my experience as well ( in a few more countries than you have been).

Canadians live in a bubble and don’t realize that many other countries do as well. They just think that the Canadian bubble is superior to everyone elses’ I guess.

#212 Hillbilly on 06.06.14 at 4:18 pm

Alicia – comment # 113

I’ll bet you are a fun date.

#213 Hillbilly on 06.06.14 at 4:22 pm

Carly in Cabbagetown – comment # 11

Another fun date for sure !

#214 Old Man on 06.06.14 at 4:24 pm

#209 Nemesis – you have been placed on report with the Amazonas and they will find you in time. Your very manhood might be at stake for making fun at them.

#215 Freedom First on 06.06.14 at 4:28 pm

#113 Alicia

Men invented and built everything in the world. Alicia, you are a man hating woman-that is called misandry. I would not marry in today’s world. The court system and feminist nazis like you are way to dangerous. These are facts. I am an honest man, and my girlfriends always know I will never live with them or marry them. More and more women are learning the truth as more and more men refuse to marry world wide. These are smart men who know how to protect themselves from societies rampant abuse against men.

#216 Hillbilly on 06.06.14 at 4:42 pm

Adriana Lima – comment #158

Hip Hip Hooray !

A REAL woman speaks, and I’ll bet has no end of respectful male admirers for her attitude.

My kind of gal !

#217 retired Boomer - WI on 06.06.14 at 4:50 pm

Another decent week on Wallstreet.

Where are all those dormers? Gold bugs? When employment creeps back ever so slowly, but it is creeping back, investors (actually holders) prosper.

So the S&P is yp 180% or there a bouts since the 2008 low, good thing to be there. Will it last? Will Real Estate?
Nobody can tell, but me and the wife are eating off for lobsters & cocktails. Hope you are, too.

#218 retired Boomer - WI on 06.06.14 at 4:51 pm

Doomers Dam auto-correct. sorry!

#219 Rabbit One on 06.06.14 at 4:57 pm

>#163 Lurcher

My friend was laid off from accounting job at med-size Logistic company in Vancouver last November.
It was big lay-off (whole floor account department staffs were laid off but 2 supervisors), accounting job was outsourced to the Phillippines.

Other friend of mine, she was laid off from one of the big banks admin office in New Westminster a few years ago – outsourced to India.

Both were optimistic about finding next jobs, but no lucks.
If you are laid off due to oursourcing offshore, chances are other companies are doing the same.
If not cutting people, but not hiring.

They are both like to stick to their long term occupation, (accounting admin / bank back -office) but maybe the time to look for changing line of business.
So, sad.

#220 4 AM Sunrise on 06.06.14 at 5:44 pm

#113 Alicia on 06.06.14 at 6:29 am

So the well-educated women in your circle own condos and townhouses, eh? Do they own outright? Or is it with 5% down? A helper down payment from the Bank of Mom & Dad? Do they have maxed-out TFSA’s? Still shouldering student debt? Credit card debt?

And if men are so inferior, how do you explain all those male geeks making technology run (and making good money at it)?

Back in university in the late 90’s, I tagged along with a friend to a women-only seminar in the commerce department. The host was dispensing career and life advice. Her most memorable statement was, “ladies, you can have it ALL! You CAN have the husband, the children, the career, the house, and the car!”

And thus house horniness was born.

I wanted to jump up and shout, “excuse me, but you talk about family and career like they’re just on a checklist of Things To Have. It’s a selfish and materialistic way of looking at life.” But I was too shy, and too busy stuffing my mouth with the gourmet food they served there.

I wonder how many of the girls there bought that line.

And this is how a subsection of a generation of professional women were taught to define themselves by their possessions.

#221 Hillbilly on 06.06.14 at 6:03 pm

Freedom First – comment #215

And here I thought that was just your blog tag name.

Bravo !!!

#222 Snowboid on 06.06.14 at 6:08 pm

#185 Nemesis on 06.06.14 at 12:33 pm…

Saw the article too – here’s the link to the report:

http://www.inthepublicinterest.org/sites/default/files/Race-to-the-bottom.pdf

We bemoan the demise of the ‘middle-class’ – this study points out that a large part of the blame (at least in the US) is the privatization of former public services.

I know this to be true in BC (worked on one of the larger privatization initiatives) where it is fact the move from public to private cost the taxpayers more for poorer service. These initiatives continued and are an ongoing transfer of ‘wealth’ to the private corporations who don’t have any interest but one thing: profit (and obscene executive salaries)

A side effect is the reduction of salaries and loss of benefits, with the accompanying elimination of purchasing power – end result the 1% get richer while the privatized workers starve.

Maybe that’s why BC is ‘booming’ at the same time we have the worst child poverty in the country!

#223 4 AM Sunrise on 06.06.14 at 6:10 pm

#81 Cici on 06.05.14 at 11:06 pm

Don’t beets come from all over Canada? They’re a natural upper-latitude kind of vegetable. I was born and raised here and I can’t believe and I didn’t start eating them regularly until I was in my 30’s. (I’m Asian so I didn’t grow up eating them.)

#224 };-) aka Devil's Advocate on 06.06.14 at 6:11 pm

#208 kommykim on 06.06.14 at 4:01 pm

I didn’t go that far back in the chain.

It would appear they have “since the hockey buddy signed an agreement with agent to buy”. If so then we must let the contract do the talking. Does the contract specifically say the Buyer’s Agent must prepare and present ALL offers?

Unfortunately I have seen far too many situations where an agent did not interview a client to determine exactly what their expectations were. There is an addendum to the contract that provides for these expectations to be spelled out if not already in the standard form. I think that is where you would find such a clause. The question now is; did they mutually agree and add such a clause to the Exclusive Buyers Agency agreement?

You see this is but one of the beauties of using an Exclusive Buyers Agreement; while yes it does protect the agent, giving better chance that they will be paid for their service, it protects the client too by holding the agent accountable.

I have found that, properly explained, no buyers are only too willing to sign an EBA (BRA for you Torontonians).

#225 macho man on 06.06.14 at 6:15 pm

To Carly and Alicia

There’s nothing worse than scorched, sexist female. You are definitively the result of the “modern” day woman that doesn’t know where she belongs. Thankfully for us, woman like you end up alone and don’t have the chance to procreate and pass on your stupid ideas. I’m sure if you had a son you would see things differently.

That’s why you will see more and more Canadian men with gals like Adriana Lima. Don’t get me wrong these women are smart educated and know how to raise a family.

You are the typical woman that will over bid for a stacked townhouse in Toronto. You lose good day sir.

#226 UVZ on 06.06.14 at 6:40 pm

Re: Fukushima comments.

Anyone can buy a Geiger counter. Just make sure yours can measure alpha particles (more expensive meters) as well as beta and gamma particles. You can have a good “pro-sumer” model for under $500 from eBay or from here: http://www.mazurinstruments.com/ (note the PRM-8000).

Measure your own data and don’t lose your mind over something you can’t see.

I know this is off-topic for this blog. But being rational and fact-based in your approach should be perfectly on-topic.

#227 Mark on 06.06.14 at 6:40 pm

“Hi Garth, agree with the logic but the play is short Canadian dollar which has worked out well and should continue.”

Doubtful. The falling market implies a much higher Canadian dollar, as domestic debt deflation takes hold. Shorting the Canadian dollar is just asking to get your head ripped off in the process.

#228 Nemesis on 06.06.14 at 7:01 pm

#AquaVevo. #BarbieGirls.

“And this is how a subsection of a generation of professional women were taught to define themselves by their possessions.” – [email protected]

Personally, I blame the Mattel™ ToyCorporation.

http://youtu.be/ZyhrYis509A

[NoteToGT: Just between the two of us, that particular PlasticMonstrosity was visited upon us by a Woman: http://en.m.wikipedia.org/wiki/Barbie ]

#229 Lost Soul on 06.06.14 at 7:37 pm

http://businessmirror.com.ph/index.php/en/business/companies/4659-bpo-vows-to-expand-phl-labor-base-as-canada-leaves-top-10-list

An older article on outsourcing to the Philippines for the BPO Call center industry. Can not even imagine now how many Canadian, American, European companies have set up shop here. Recently the number on the local news was 1 million BPO jobs and projected to add 20% more over the next year or so, remember that next time your phone rings. So you see pretty soon many of the service jobs will be shipped off shore and whatever jobs are left will pay so little by Canadian standards that we will have to import more workers to fill them.
Really..this can not end well, the only decent paying jobs left are in some level of government.
Globalization and Free trade did not exactly turn out like Reagan and Mulroney advertised did it. Shame on you Brian!
I bet many readers can remember when many Canadian towns and cities had a vibrant manufacturing base. Victoria for instance up till the late 7o’s early 80’s had Mcdonalds/Mcgavins bakery, Bapco Paint, British Columbia Forest Products, Labatts Brewery
Now In Canada on the other hand we are left to wash each others clothes, clean the swimming pools and hawk tacos from food trucks and oh yeah welcome you to Walmart. T
he Philippines has one of the fastest growing economies in Asia, still with lots of problems. But not a day goes by that another announcement of a new factory or direct investment is announced.
In BC the move is on to use more care aids. If only they could tap into the 100,000 or so nursing grads that the Philippines cranks out every year. man that is the kind of stuff that gives health care managers wet dreams..haha!
The standard of living for Canadians, Americans and Europeans only has one direction to go and thats down baby get use to it!

#230 Habs76-79 on 06.06.14 at 8:16 pm

#220, 4 AM Sunrise.

Yep…

One thing most people need to learn especially if they have been brainwashed by talking heads of IMO high disrepute, (and yes many of these vultures have fed upon mostly young women’s minds for too long now), that in life one cannot have it all, all the time. Most won’t have it all at any time, few may have it all at some times, but again NOBODY CAN HAVE IT ALL ALL OF THE TIME!

And yes, raising a family and maybe buying a home is not the same as say buying a new car. Buying a new car has little real life long effect on a person’s life, but raising a family and making the decision to HOPEFULLY buy a home of whatever type WITHIN YOUR REAL MEANS is a major life long event.

#231 angela on 06.06.14 at 10:13 pm

holy Garth this is one of your reality post good job

#232 angela on 06.06.14 at 10:14 pm

so no recovery then ?

#233 nonplused on 06.08.14 at 12:37 am

Alicia can’t be serious. She must be a boomer trying to divert the usual boomer wars to something else.

But if there was a point to be made, mankind never saw anything quite so exploitive as the “stay at home mom” combined with modern family law. I lived in one of those houses. My dad busted his balls all day long, talking sun up to sun down in the summer, and my mom watched “days of our lives”. She needed the tv of course because the appliances did most of the work, so she was bored. And I’ll tell you one other thing, my dad was definitely not the boss. He was an indentured servant provider. Plus he had to do all the beating of the children, but I don’t know if it was often his idea. He was “just following orders”.

I don’t know that I totally disagree with family law as we see it in Canada. Some parts are hard to get around like child support, except mom should stop spending the money on vacations to Florida, but I also understand the courts don’t have time to police that stuff so it’s pay the money and hopefully the kids see some of the benefit.

But any young man out there being seduced by the stay at home mom types: Run! Don’t walk, RUN! It doesn’t seem so unfair to split your assets 50/50 upon divorce (you will get divorced at some point these days, it’s just what they do) if you both paid for half, so that’s all fair. But if she’s going to be spending her days thinking about what color nail polish is the most flattering, RUN! There are plenty of hard working independent women out there. Even Amazon babes who will wash your motorcycle for you.

And yes, I understand when the children are young tough choices need to be made. Child care is not cheep. But once the kids are in school, before and after care is $350 a month, another $350 for the cleaning service, split the laundry and yard care, and there you have it. The net economic contribution of a stay at home mom is $700/month. My wife pulls down way more than that, enjoys her job for the most part (every job sucks a bit), and is able to socialize with adults. And she doesn’t have to clean the toilets. And if she spends a little money on nail polish, well what am I going to say? It’s her money.

I know most of the young guys out there already understand this, but if there is anyone who didn’t get the memo, a woman’s career is as important to her attractiveness now as a man’s career was 30 or 40 years ago. No career? No second date.

#234 nonplused on 06.08.14 at 12:45 am

I should add to that rant that summers are hard to deal with. We end up putting the boy in very many summer camps. But you know what? He has a blast! I wish my summers were like that when I was a kid! And they eat up most of my wife’s salary for July and August. But you know what else? We were putting him in those camps before she went back to work. As I like to say, now they are paid for.