The high life

GLUTEN

Some weeks back the nation stopped in its tracks to witness the outpouring on this blog. When I asked the dogs who run here what their net worth might be, the results were eye-opening, to say the least. I spent the next two weeks telling the Canada Revenue Agency guys to bug off. Finally I relented and sold them the complete email address and IP list. Sorry. I know you and your heirs will understand.

Anyway, you’re rich. But are you rich enough? Let’s put this in context.

Environics, which earns money peddling data analysis to big corporations, made waves this week with a new report stating family wealth in Canada is growing by double-digits. It says households, on average, have $442,130 in net worth, after debt of $122,075 is deducted (that includes mortgages). Sounds impressive, right?

Of that, half ($213,000) is in real estate equity. The other $229,000 is liquid, with more than $82,000 in cash savings. So, invested assets equal $145,000. Now things don’t look so hot.

While house prices have romped higher since mortgage rates romped lower, there’s growing evidence in market after market that the party for most Canadians is over. It’s hard to imagine there are consistent and meaningful real estate gains lying ahead for people in Halifax, Montreal, Regina or Victoria. Besides, houses cost money to own, while liquid assets don’t. Moreover, getting equity out for most people means selling property, which is not only expensive (5% commission) but can be a nightmare in times of illiquidity (which approach).

The eighty grand in cash? That’s in chequing accounts (paying nothing), 1% savings accounts or comatose 2% GICs and term deposits. Dead money, in other words, slowly eroding in a world of 2.5% inflation while being fully taxed outside of a registered account.

This leaves the $145,000 in investible assets, the bulk of which sits in bank-sponsored mutual funds. Thanks to gains in US equity markets during 2013, here’s where the best gains were made – an increase of 10.4%. Smart, because most of that came in the form of capital gains, which are taxed at only 50% compared with money you earn working.

Meanwhile family debt is still increasing, with a 3.3% increase last year in outstanding mortgages. They now total about $1.2 trillion (which means every 1% equals another $12 billion). The cheery news, says Environics, is that real estate values grew faster than the additional debt. So, we’re good.

At least for now. Over the last four decades real estate appreciation nationally has been 0.4% annually, so when we revert to the mean, it’ll be highly interesting, what with all the wailing and foaming.

Now, here’s where you gentrified, haute couture, truffle-snorting blog dogs come in: There are 320,000 rich people in Canada who have (outside of their principal residences) $1 million in investible assets. Together they’re worth about $979,000,000,000, for an average of $3.06 million per household.

So the liquid worth of each rich person equals that of 13 average families, which means the 320,000 wealthy have the same aggregate liquid assets as 4.27 million households.

Hmm. There are only 13.2 million households in the country, so I guess the top 1% of people have the same as liquid net worth as one third of all households combined. So much for averages.

The point should be clear. Savings of eighty grand and investments of $145,000 (most of it in taxable RRSPs) is the best case scenario. When we remove the $979 billion in the possession of the one-percenters, those ‘average’ numbers fall precipitously, which means real estate – as a percentage of net worth – rises just as dramatically. Any way you cut it, most Canadians have adopted a one-asset strategy and are at serious risk if house values correct. Which, of course, they will.

Remember: middle class people have the bulk of their net worth in a house. Rich people don’t.

Should tell you something.

Oh, by the way, the CRA guy who now shares my office wants to know if you could possibly include your SIN when you post comments. Ta.

162 comments ↓

#1 Big Ed on 08.11.14 at 5:45 pm

lap dances at The Great America Bush Co.

Hmmmmm.

What could possibly go wrong?

#2 Big Ed on 08.11.14 at 5:46 pm

Sorry. Great Alaskan Bush Co.

Too much pressure going first.

#3 ottawa on 08.11.14 at 5:48 pm

The median net worth of Cnd families was approx $250k or about $200k less than the avg

#4 Randy on 08.11.14 at 5:50 pm

Wondering if all of the gold-plated defined benefit pensions for public servants are sustainable ?

#5 Big Ed on 08.11.14 at 5:50 pm

Besides, houses cost money to own-Garth

Living just about anywhere costs money-Big Ed

#6 Son of Ponzi on 08.11.14 at 5:50 pm

Oh, by the way, the CRA guy who now shares my office wants to know if you could possibly include your SIN when you post comments. Ta.
————
I thought the SIN is embedded in the IP.

#7 May on 08.11.14 at 5:51 pm

Please God – no crash until my neighbours sell their house. After that I don’t care what happens.

Cheers!

#8 Financial Freedom at 40 on 08.11.14 at 5:55 pm

Speaking of the CRA, how’s our favourite David fighting Goliath, Mr Leroux?

#9 Big Ed on 08.11.14 at 5:56 pm

There are 320,000 rich people in Canada who have (outside of their principal residences) $1 million in investible assets. -Garth

Garth this makes no sense to me at all. So, if I have 1 million investible assets and rent a mouldy basement bachelor I am rich.

But if I have a paid off home worth 800,000 and another 800,000 in investible assets I’m not rich???

I’m confused.

#10 calgaryPhantom on 08.11.14 at 5:59 pm

Oops, there goes my under the table income. SIN what?

#11 nonconfidencevote on 08.11.14 at 6:00 pm

Sorry Garth, I lied about my income and net worth.
I’m actually a toothless “hobo with a shotgun” looking for a new balaclava.
Can you spare any empty beer cans? I have to pay my internet provider so I can continue come here and dream I’m rich like the rest of the blogdogs………

#12 Subprime Obsessed on 08.11.14 at 6:11 pm

So that explains those guys in suits hanging around the bridge I live under.

Ask Mark for my SIN number, he probably knows it. He knows everything about everything.

#13 rainclouds on 08.11.14 at 6:18 pm

No truffles, too Italian. Kinda effete. Good old fashioned lobster .

Hey! Chester race week coming up, wonder what the serfs are doing? Doesn’t matter……

Dear bean counters 123-456-789

Alcohol, a maritime tradition. ………

#14 592-505-705 on 08.11.14 at 6:19 pm

When providing SI Numbers to anyone who really does not need to know, but insists that the form be filled out:

http://www.fakenamegenerator.com/social-insurance-number.php

Generates a randome SIN with the correct check digit. Also can verify if any particular SIN is valid.

#15 Trent on 08.11.14 at 6:24 pm

I’ve been reading this blog for over 6 years. I appreciate much of the sentiment coming from the US where I witnessed (and still see) the effects of the housing collapse.

Garth, the one warning you keep making about the Canadian housing market that I cannot agree with is the simplistic, “interest rates are going to rise because they have only one way to go.” You cannot repeatedly warn people of impending deflationary pressures via a housing correction and weak overall Canadian market while at the same time predict an inevitable interest rate increase.

Interest rates will not rise in a deleveraging environment and that is what we’ll have during a housing correction. That is the lesson we’ve learned from Japan and the US and pretty much the entire world over the past 8 years. Rates will remain low here. When the housing bubble bursts (which I truly believe will occur) and people’s spending drops and the economy hits the skids, those are all hallmarks of deflation. What dynamic is going to cause rates to rise?

On top of that, the next 10-15 years are going to see the acceleration of the cannibalization of industries by AI and robotics. One can argue that this entire century will be characterized by deflationary effects, driving costs, wages and employment lower and lower. In the near term, it’s already happening.

If I’m missing something please point it out because I just don’t see it. The very effect of higher interest rates (widespread inability to carry mortgage) will prevent rates from rising as Canadians shift from consumption to deleveraging.

There’s gotta be a better rationale than saying, “rates won’t stay low forever.” That’s like a bear saying, “This market can’t keep rising.” And you would sneer at that kind of attitude.

Of course rates will rise as the Fed ends QE, the US economy becomes more inflationary and GDP rebounds. Canada will follow suit in a gentle, upward arc. Like I said, you can deny it or prepare. — Garth

#16 Vince on 08.11.14 at 6:26 pm

Hi Garth,

Do you think Toronto will deflate in the housing market (towns, semis)?

A friend of mine said during the US bubble burst in the real estate market, hot urban areas in places like New York didn’t go down. Do you have a chart for major urban cities like you had a global overview with charts?

Thanks,
Vince

#17 Shawn on 08.11.14 at 6:30 pm

Big Ed does not exist?

So, if I have 1 million investible assets and rent a mouldy basement bachelor I am rich?

But if I have a paid off home worth 800,000 and another 800,000 in investible assets I’m not rich???

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

The first guy does not exist. Or there are maybe 25 people like that around, statistically insignificant.

You are right, the second person is richer.

Financial advisors define rich as investible assets, because that is what they want from you. If you have a million in investible assets they salivate just thinking about you.

If you have a house worth a million and no money to invest, you are a waste of time to them.

So yeah banks define rich in a way that makes sense to them.

Confident self reliant people are free to feel rich with a lot less. Rich is an attitude. Staying rich is a series of habits. Being independent and self reliant is a form of richness for sure.

Actually rich is rich. It’s a measure of money, not stuff. — Garth

#18 kommykim on 08.11.14 at 6:36 pm

RE:#6 Son of Ponzi on 08.11.14 at 5:50 pm
I thought the SIN is embedded in the IP.

Only for P0rn sites.

#19 Londoner on 08.11.14 at 6:40 pm

Wow, still can’t believe that the price of Toronto SFHs have dropped 9% in just 4 months. That’s a phenomenal price movement.

That was an interesting article in Macleans about the Canadian (and US) obsession with home renovations. It’s interesting to see what Canadians/Americans see as adding value to a home versus the Brits. I think most North Americans would be horrified at what they would find inside a UK house… lol.

#20 Mark on 08.11.14 at 6:41 pm

““interest rates are going to rise because they have only one way to go.” You cannot repeatedly warn people of impending deflationary pressures via a housing correction and weak overall Canadian market while at the same time predict an inevitable interest rate increase.”

Actually, yes Garth can get away with such an apparent contradiction. Want to know why?

The reason is because at the moment, there are rock-bottom spreads against mortgage and consumer-backed debt. In other words, lenders are not collecting a risk premium on mortgages. But they are sure collecting a risk premium on other types of debt.

For instance, as I pointed out probably a month ago in the comments, BCE paid over 3.5% to refinance a billion dollars worth of 5-year term debt. While “Joe Sixpack” can call up a mortgage broker and get a mortgage sub-3% these days.

Now, even in the absence of policy rate changes, this relationship can (and will) reverse. BCE (a company that employs 100,000 people and countless additional contractors) gets cheap financing. Mortgage borrowers pay higher rates. Even if the BoC remains on hold at 1%.

Does this clear it up? Spreads applicable to any specific type of collateral tend to be cyclical. Business credit (such as BCE as above) is currently abnormally expensive. Consumer credit is cheap. As this relationship switches, consumer’s are going to hurt. While firms like BCE are going to save literally billions on the refinancing of their debt and will be able to pay increasingly juicy dividends. The stock market will go up, housing will go down, and eventually, 10 years from now, hopefully “greaterfool” will mean investing in the overpriced stock market and the smart money will be buying out-of-favour houses.

#21 Happy Renting on 08.11.14 at 6:46 pm

Interesting breakdown of the data, thank you. Both as a yardstick to compare to and just plain nosiness, it’s hard not to wonder how acquaintances and the people you consider your “peer group” are doing.

So we know there are uber rich ($979 billion? Holy cow!), and we know there are the super-broke. A big hunk of the blog’s readership is people who are the in-between, people who will likely be okay (or better) in the long run. Curious to know how big that segment is within the overall population. The slice that are “survivors” versus “rich” and “screwed”.

As for my SIN: gluttony. Not one of the more exciting ones, I’m afraid.

#22 crowdedelevatorfartz on 08.11.14 at 6:49 pm

@#4 Randy
Absolutely unsustainable as they now stand.
1.Govt employee pension contributions will rise but not to a level where taxpayers will not still have to “top up” their garanteed pensions.
2.Cuts will happen to medical/dental benefits.
3.The inflation indexing will go.
4.Pension age will rise or ‘years of service”.
5.Govt employee’s and retired govt employees will wail at the injustice of it all.

#23 Unknown Marketer on 08.11.14 at 6:50 pm

Better Than Letterman….LMAO… :)

“Oh, by the way, the CRA guy who now shares my office wants to know if you could possibly include your SIN when you post comments.”

Good find on the stats…Blog Master

#24 Temporary Foreign Prime Minster on 08.11.14 at 6:54 pm

“…..Remember: middle class people have the bulk of their net worth in a house. Rich people don’t. Should tell you something…….
====================

Absolutely.

Rich people can no longer afford to own houses. Who knew they’d be the first to go? Let’s take up a collection….

Epoxy can be cured! Give Now!

#25 Dan on 08.11.14 at 6:55 pm

I love the Great Alaskan Bush Co!

#26 Son of Ponzi on 08.11.14 at 6:57 pm

Garth,
Now that we know that you’re sharing your office with a CRA guy, can you do another survey of incomes and net worths?

#27 Mark on 08.11.14 at 6:57 pm

What dynamic is going to cause rates to rise?

For individual borrowers and individual types of collateral, lack of credit-worthiness.

For the economy broadly, I agree, inflationary pressures are long, long ways away, and the BoC is going to have quite a fight on its hands over the next 5+ years simply trying to keep CPI growth meaningfully above zero in a consumer de-leveraging environment. Unless, of course, some new speculative bubble of some sort really starts to take off. Perhaps originating completely outside of Canada’s borders?

#28 craig on 08.11.14 at 6:59 pm

i was surprised to see this: “Over the last four decades real estate appreciation nationally has been 0.4% annually”. i am wondering where this comes from. i was under the impression that long term real estate rise was about 3%.

#29 Mark on 08.11.14 at 7:09 pm

“i was surprised to see this: “Over the last four decades real estate appreciation nationally has been 0.4% annually”. i am wondering where this comes from. i was under the impression that long term real estate rise was about 3%.”

Sounds like a real rate (ie: a “0.4% real real estate return”).

From Econ 101:

Nominal = Real + Inflation

#30 crowdedelevatorfartz on 08.11.14 at 7:13 pm

@#4 Randy
a few links regarding the financial sustainability of the Canadian Govt Employee pension plans……

http://www.google.ca/url?sa=t&rct=j&q=&esrc=s&frm=1&source=web&cd=7&cad=rja&uact=8&ved=0CFAQFjAG&url=http%3A%2F%2Fwww.cdhowe.org%2Fottawa%25E2%2580%2599s-pension-gap-the-growing-and-under-reported-cost-of-federal-employee-pensions%2F16001&ei=wUzpU4a5B9fooAT_5oKoBg&usg=AFQjCNG9E_BDp7PbdDom6HV9Lap_lJJQog

http://www.google.ca/url?sa=t&rct=j&q=&esrc=s&frm=1&source=web&cd=5&cad=rja&uact=8&ved=0CEIQFjAE&url=http%3A%2F%2Fwww.thestar.com%2Fnews%2Fcanada%2F2012%2F01%2F09%2Fpension_troubles_in_store_for_retired_workers_as_plans_across_canada_face_deficits.html&ei=wUzpU4a5B9fooAT_5oKoBg&usg=AFQjCNGLpn_XMUsNPVIAGekuu63sTnjkLg

http://www.google.ca/url?sa=t&rct=j&q=&esrc=s&frm=1&source=web&cd=8&cad=rja&uact=8&ved=0CFUQFjAH&url=http%3A%2F%2Fviableopposition.blogspot.com%2F2013%2F12%2Fthe-pitiful-state-of-canada-public.html&ei=wUzpU4a5B9fooAT_5oKoBg&usg=AFQjCNFQ8xWuLuid29zRM2HJciGl4tcAmA

#31 T.O. Bubble Boy on 08.11.14 at 7:19 pm

Oh, by the way, the CRA guy who now shares my office wants to know if you could possibly include your SIN when you post comments. Ta.

My refund is due soon… don’t mess with me!

#32 T.O. Bubble Boy on 08.11.14 at 7:21 pm

@ #17 Shawn on 08.11.14 at 6:30 pm
Big Ed does not exist?

So, if I have 1 million investible assets and rent a mouldy basement bachelor I am rich?

But if I have a paid off home worth 800,000 and another 800,000 in investible assets I’m not rich???

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

The first guy does not exist. Or there are maybe 25 people like that around, statistically insignificant.
—————————-

I rent a home, and easily surpass the $1M investable assets benchmark… there have to be far more than 24 of me.

#33 FormerSaskie on 08.11.14 at 7:22 pm

Ouch!! Were these numbers worse than even you expected, Garth?

#34 darth on 08.11.14 at 7:25 pm

Real Estate commission includes HST so it is actually 5.65% you lose on the sale – not 5%.

#35 armpit on 08.11.14 at 7:29 pm

Posted July 22

“T.M.I. everyone….your I.P. address identifies you. Shame on you, Garth! – armpit”

“It does not. Shame on you. — Garth”
————————————————————-

Told ya so!

#36 Kender on 08.11.14 at 7:31 pm

My colleague who is paid around 110,000 bought a house worth 1.4 million in Toronto. How? One of the parents is a Chinese official who keeps his money here in Canada, so that if he gets in trouble with the chinese government, he can quickly escape (their government has been putting many officials in jail). There is even a name for officials who do this: naked officials.

I asked him if he is a special case. He laughed. He told me many friends bought houses around the same area, big new houses, with a downpayment they could never have afforded with their income. The parents are officials. Others have bought a 250k condo in Shanghai 10 yers ago, which increased in value to 900k. They sell and move here. Rent until they become permanent residents, then buy.

I know stats say that foreigners account for little of the sales but that’s not relevant… The stat we need is the number of permanent residents that bring in money from abroad and use it for a downpayment.

Surely this stat is obtainable by out government.

And we care, why? — Garth

#37 Spaccone on 08.11.14 at 7:53 pm

>I spent the next two weeks telling the Canada Revenue
>Agency guys to bug off.
>
>Oh, by the way, the CRA guy who now shares my office >wants to know if you could possibly include your SIN >when you post comments. Ta.

Woops, re: my net worth post, I just realized that as I had only recently returned from Europe I was still stuck in a European mindset and using “,” instead of a “.”

#38 Kender on 08.11.14 at 7:56 pm

“And we care, why?”

If Canada is becoming a shelter for money obtained by corrupted foreign officials, and that money is used to buy houses in the better located neighborhoods, with the better schools, we care.

Why are they corrupt? How do you know this? Who’s stopping you from buying the same house? — Garth

#39 I am #23 on 08.11.14 at 7:57 pm

32 T.O. Bubble Boy on 08.11.14 at 7:21 pm
@ #17 Shawn on 08.11.14 at 6:30 pm
Big Ed does not exist?

So, if I have 1 million investible assets and rent a mouldy basement bachelor I am rich?

But if I have a paid off home worth 800,000 and another 800,000 in investible assets I’m not rich???

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

The first guy does not exist. Or there are maybe 25 people like that around, statistically insignificant.
—————————-

I rent a home, and easily surpass the $1M investable assets benchmark… there have to be far more than 24 of me.
+++++++++++++++++++++++++++++++++++

Count me on that list as well.

#40 Bob on 08.11.14 at 8:01 pm

@BigEd

I’m not sure why some owners think the only thing to rent is a mouldy basement suite. I’m happily renting the top floor. When this house of cards collapses some of these over stretched homeowners will be in the basement while I’m renting the top floor and they are throwing in the garage as an incentive to sign a lease.

#41 TurnerNation on 08.11.14 at 8:10 pm

TSX stocks have gone into “Fugi activation mode”.

– RE did this:

http://www.blogto.com/fashion_style/2014/08/williams-sonoma_pottery_barn_closing_bloor_st_stores/

As of early next year, Toronto’s home cooks and decor aficionados will no longer be looking to Bloor St. for their decorative knick-knacks and Le Creuset crockpots. Williams-Sonoma Inc. has announced it’s closing its Yorkville outpost, along with its sister home furnishing store Pottery Barn, at the beginning of 2015. The move will open up a massive two floors of retail space, amounting to 37,000 square feet, Retail Insider reports.

The company blamed the “rising costs of real estate” in the neighbourhood for the pullout;

#42 Realties.ca » The high life on 08.11.14 at 8:15 pm

[…] Source: http://www.greaterfool.ca/2014/08/11/the-high-life/ […]

#43 hardassi on 08.11.14 at 8:17 pm

Thanks Garth for noting how the money held by the 1% skews the average. ‘Median’ wealth would be more meaningful and a lot more chilling, especially tracking the rise in wealth of the 1% while the median slowly sinks….

#44 Mean Gene on 08.11.14 at 8:17 pm

Huge difference between average and mean, thank you Mr Turner for setting the record straight.

#45 Rudy on 08.11.14 at 8:20 pm

Garth,
Where do I send the bill for my keyboard. Spit my drink out all over the keyboard, laughing at your reference to selling out all us ‘rich’ blog dogs to the CRA.

Thank you for the informative and entertaining musings and missives on economics, RE, money and the road ahead. We are all enriched by the generous sharing of your gifts.

#46 the Jaguar on 08.11.14 at 8:29 pm

I read this blog because I think Garth is very wise, and I am never disappointed. (well….maybe with some of the blog dog comments).
But Garth is also very funny. I love the idea of some of the blog dogs being caught up in Canada Revenue Agency “dragnet”! Fun!

#47 Tripp on 08.11.14 at 8:31 pm

“There are 320,000 rich people in Canada who have (outside of their principal residences) $1 million in investible assets. ”

Zut alors, the Occupy movement was very accurate! They really are only 1%!

#48 ILoveCharts on 08.11.14 at 8:31 pm

There are a lot of people who have made excellent returns on real estate in the past 15 years. If you bought in 2000 (using a mortgage for leverage,) and you sell today, you’ve done pretty well. Even if you hold on and lose a bit from today’s values, you are not exactly hurting.

This is an odd way for wealth to be created – apparently out of thin air. No goods were created. No services were provided.

Does that devalue our currency?

A diversified investment portfolio for the next 15 years seems like a responsible decision… but for those of us that want to take much more risk to hunt for the big gains, what will be the next big thing?

#49 Sheane Wallace on 08.11.14 at 8:32 pm

Here it is:

http://www.opednews.com/articles/Malaysian-press-charges-Uk-by-Alex-Lantier-Government-Corruption_Malaysia-Airlines-Flight-17_Putin_Russia-140809-576.html

Does Harper have any credibility left?

#50 the soop nazi on 08.11.14 at 8:35 pm

Big Ed…..sorry dude…but them’s the facts…..you can only create debt with your real estate asset and it is valued day to day…cause who knows what it will be worth tomorrow? It might be worth 800K today…..but when the sub rises the Wynne Libs may have introduced legislation that takes that down to zero. Thats why it’s called a non fungible asset.

Take it to Vegas ( or a Canadian lender) and throw the title on the table and you’d be lucky if they give you 40%……( that’s why reverse mortgage guys only finance max 40%) same will happen if you want to borrow against it to invest…..a brokerage will lender you far less than a real estate marketers estimation.

The bank will look at your status….but then ask you how much you make each month…..if you ‘ve lost your job….the bank won’t loan you a thin dime against your 800K……cause you can’t make the payments….leaving you forced to sell to realize anything out of it. So Ed….no millionaire status for you.

And btw way Garth….karma baby…..instant karma’s gonna get you.

#51 Happy renter on 08.11.14 at 8:37 pm

After the CMHC revelations last week that 1/5th of home owners also have a rental unit, Business in Vancouver has this article:

Condo investors account for less than one-fifth of those who own units in two of North America’s most expensive housing markets, according to survey results from Canada Mortgage and Housing Corporation (CMHC).

But as Vancouver and Toronto grapple with tight vacancy rates and high homeownership costs, data released August 8 shows 6.9% of condo investors maintain vacant units.

http://www.biv.com/article/20140808/BIV0111/140809947/-1/BIV/69-of-condo-investors-in-vancouver-and-toronto-maintain-vacant

#52 Flawed on 08.11.14 at 8:40 pm

Why are they corrupt? How do you know this? Who’s stopping you from buying the same house? — Garth

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

1. JACKED UP house prices caused by the continually DENIED HAM

2. JACKED UP taxes making after tax income too low to be able to afford a house with “regular income”.

As opposed to required money coming from bank of mom and dad or un-taxed HAM money.

Do not blame others for your inability to afford something. — Garth

#53 Flawed on 08.11.14 at 8:45 pm

By the way…….I’m in South America right now figuring out where to escape. Cdn ex pat community here is huge in every friendly country. Enjoying a wonderful CHEAP dinner in Paraguay right now that has low taxes and a non-corrupt govt. Will move wife and kids within the next 12 months. Probably to Uruguay.

Good luck finding the revenue to keep paying those Public Servants Canada cuz it aint going to be coming from us. Were outta here……

Now the Uruguayans can hate you, jacking up their prices. — Garth

#54 Mark on 08.11.14 at 8:50 pm

“But as Vancouver and Toronto grapple with tight vacancy rates and high homeownership costs, data released August 8 shows 6.9% of condo investors maintain vacant units.”

Tight vacancy rates? If that were the case, then rents should be rising. Are they? Not in any meaningful way.

If condo/housing investors want to throw their money away, luckily our system of democracy and property ownership allows them to do so. Smart people allocate their funds to productive investments though. Just remember that fools and their money are usually separated, sooner or later.

#55 Sheane Wallace on 08.11.14 at 8:51 pm

#53 Flawed

I recommend Spain.

#56 Smoking Man on 08.11.14 at 8:57 pm

#49 Sheane Wallace on 08.11.14 at 8:32 pmhttp://www.opednews.com/articles/Malaysian-press-charges-Uk-by-Alex-Lantier-Government-Corruption_Malaysia-Airlines-Flight-17_Putin_Russia-140809-576.html

Does Harper have any credibility left?
……….

Harpo only concerned about post dictator occupation..

I’m racking my brains out trying to anticipate what bs will come from the MH17 investigation.. And what Putin has up his Sleve after the west plays there bs card…

Every Twitter feed, every MSN comments section where the topic is MH17 posters posting links and facts that Ukraine took it down with SU25 30 mm bullets…

I’ve never seen us so caught lying..

MH17 might vanish just like MH370 never to be scene again in MSM

#57 };-) aka Devil's Advocate on 08.11.14 at 9:07 pm

”Over the last four decades real estate appreciation nationally has been 0.4% annually, so when we revert to the mean, it’ll be highly interesting, what’s with all the wailing and foaming.” – Garth

And let us not forget that those four years were in a cyclical trough.

”Any way you cut it, most Canadians have adopted a one-asset strategy and are at serious risk if house values correct. Which, of course, they will.” – Garth

But being at the lead edge of leaving the trough, based on those “lessons” history taught us as per our previous discussion house values will inevitably “correct” but only after exuberant unwarranted gains but not nearly so much as they will have gone up between now and then.

”Remember: middle class people have the bulk of their net worth in a house. Rich people don’t.” – Garth

And so too remember that a far greater proportion (virtually all) if those 320,000 wealthy families own a home and in many cased much more property compared to the 12.88 million families which are not considered so “wealthy”. I suspect if you asked all of those 320,000 wealthy families about land they would virtually all agree… to a large degree, it is renters who helped the wealthy get wealthy. Furthermore, I feel safe in saying that it is to a large degree renters who with their immense weighted average of having nothing (not all but most) drag a many of the 12.88mil families down as a part of that “unwealthy” group.

Thing of it is, wealthy, poor, landlord or tenant we all need a roof over our head. But of course the renters have it figured out – they’re renting subsidized housing from those wealthy land owners. Obviously the wealthy are stupid with their investments – NOT. But believe what you want to believe.

Tell me I’m wrong… go ahead… split hairs. You know I’m right.

Just Google “Habits of the Wealthy” and see how many times “renting instead of owning a home” is mentioned as such a habit of that group.

It is not renting versus owning, but rather diversification of assets. That’s what the rich, as a group, practice. You can’t be that thick. — Garth

#58 Ray Skunk on 08.11.14 at 9:18 pm

#48 ILoveCharts

This is an odd way for wealth to be created – apparently out of thin air. No goods were created. No services were provided.
———————————————-

This is exactly it. Nothing has been created. The new owners of the 2000-purchased home you cite in your example are highly likely to be purchasing massively leveraged, with minimal downpayment and the balance borrowed at historically low interest rates. The seller’s wealth comes from the buyer’s government-backed debt which they hope to gradually pay back within 40 or so years.

This cannot continue. Buyers are tapped out. The industry knows it, which is why earlier this year we saw a new focus in trying to convince the boomers to gift to their children to keep the party going.

I get both sides of the HAM debate. It exists, no question (by “it” I mean all foreign investment, of which HAM is the singled-out target for anger and desperation). However, Garth is 100% correct when he states that HAM is a small part of the market, the rest are “native” Canadians borrowing stratospheric amounts trying to keep up; spurred on by media, dubious cartel reporting and societal pressure.

Thanks to the way governments have behaved in the past few years, today’s RE market and wider economy is being propped up on record levels of debt (not on any meaningful value creation) that have been taken out while rates are minimal. Rates may not rise for a year or so, but when they do it’s going to be extremely messy, both for homeowners and for citizens of heavily-indebted provinces (here’s looking at you, Ontario) when public service cuts are forced by economic realities.

#59 Mister Obvious on 08.11.14 at 9:21 pm

#9 Big Ed

“But if I have a paid off home worth 800,000 and another 800,000 in investible assets I’m not rich???”
——————————

I don’t know about rich, exactly, but if you are 40 years old, you are adhering to the rule of 90 nicely.

#60 Cici on 08.11.14 at 9:27 pm

#1 Big Ed

There’s nothing to worry about silly, the lap dances are at the Great ALASKAN Bush Co.

Now, where do us gals go to see the wieners wiggle?

#61 Exiled on 08.11.14 at 9:32 pm

Sir Garth: The Agenda tonight, interview with Alison Loat. About “Not A Pretty Parliment”. A book on the former Parlimentarians, 88 of them, dishing out their laments on the “party” of politics. Most where against the the parties they were forced to vote for. My guestion to you Sir Garth, were you interviewed, if no why not??

I declined. — Garth

#62 };-) aka Devil's Advocate on 08.11.14 at 9:37 pm

Robin Williams – he will be missed

#63 Flawed on 08.11.14 at 9:42 pm

Now the Uruguayans can hate you, jacking up their prices. — Garth

**********************
Maybe. But at least they are not stealing my money the way my home country does. The fact that the people are fit and the food is GMO free is also a plus.

#64 Avg Household Net Worth: $442K on 08.11.14 at 9:45 pm

Does anyone know how Environics Analytics came up with these numbers?

http://www.huffingtonpost.ca/2014/08/11/net-worth-wealth-canada_n_5667849.html

Average Canadian household asset: $564K
Average Canadian household debt: $122K
Average Canadian household net worth: 564-122 = $442K

If the debt number includes household mortgage debt, then Canada is in a much better shape than I previously thought…..

#65 Avg Household Net Worth: $442K on 08.11.14 at 9:47 pm

Sorry garth please ignore my previous post….

#66 Rexx Rock on 08.11.14 at 9:49 pm

I bet the Yanks are pretty jealous that average Canadians net worth is over $440 000.Just goes to show them we are now way better off because of our booming economy.

#67 Retired Boomer - WI on 08.11.14 at 9:51 pm

Interesting post tonight. Hmmm. $145K doesn’t get you very far come retirement time! It’s fantastic if you are under 30, great if you are under 40, decent if you are under 50, so-so if you under 60, and basically “screwed” if you are under 70.

Well, that is my reading of it, but you must understand I value security more than taking a wild gamble. I’m NOT your Smoking Man type gambler. Sure I’ll waste a buck here and there, it is my ‘right’ you might say.

When it comes to retirement, I want things reasonably warm, quiet, and comfortable. I’ll live each day like it were my last, because one day I’ll be right.

Then let the relatives fight over the leftovers. Hee, Hee!

#68 Down and Out on 08.11.14 at 9:56 pm

http://blogs.windsorstar.com/news/ill-buy-that-windsor-in-the-middle-of-housing-boom

#69 Flawed on 08.11.14 at 9:59 pm

#61 Exiled on 08.11.14 at 9:32 pm
Sir Garth: The Agenda tonight, interview with Alison Loat. About “Not A Pretty Parliment”. A book on the former Parlimentarians, 88 of them, dishing out their laments on the “party” of politics. Most where against the the parties they were forced to vote for. My guestion to you Sir Garth, were you interviewed, if no why not??

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

Proving that we live in a dictatorship.

#70 };-) aka Devil's Advocate on 08.11.14 at 10:17 pm

It is not renting versus owning, but rather diversification of assets. That’s what the rich, as a group, practice. You can’t be that thick. — Garth

I prefer to think of it as less gullible than “thick”.

Of course I understand that. And I do agree with you to a large extent that diversification a good thing. But, seriously, don’t you think the people who need the most help here are the “unwealthy” and do you honestly believe they should be investing in financials before securing a stable home for their families?

Of course according to your reader survey your readers are “the wealthy” and so they must come here for that financial advice. But if that is truly so, why is it that such a large contingent are, “apparently”, so happy to be renting instead of owning? Something just isn’t adding up.

#71 Cha Ching on 08.11.14 at 10:18 pm

Warren Buffett is holding $50b in cash ‘earning nothing’. Canadians are in good company.

Canadians are rich. Specifically homeowners and Boomers. The rest are just jealous. And poor.

Sorry. Truth hurts.

#72 Piccaso on 08.11.14 at 10:19 pm

The average Canadians net worth is over $440 000.

…………………………………………………………………..

What a crock of shit

#73 Son of Ponzi on 08.11.14 at 10:33 pm

Why are they corrupt? How do you know this? Who’s stopping you from buying the same house? — Garth
——————
You mean: What’s stopping him.
About 3 mill in cash.

#74 NostyVlad the Snugglebombed on 08.11.14 at 10:51 pm

“Living The high life [with] Environics, which earns money peddling data analysis to big corporations, made waves this week with a new report stating family wealth in Canada is growing by double-digits.”

If creating wealth is achieved by adding more debt, then sheeple have their golden numbnutzes screwed on the wrong way round.
*
So much for Obama’s sanctions — they’re not working out too well (Oz too, perhaps?), in more ways than one.

EU infighting and bickering, plus Affected countries, including the French economy, along with Holland, Germany and Poland are all losing out from not being able to export their products to Russia.

On the other hand, every time the US sends more GMO corn (plus other foods, no doubt) to China, it is rejected. At least China and Russia have caught on.

Anyone remember Edgar Cayce? It’s good to refer back to him periodically; the ebola virus appears to have coincided with the UN’s vaccination program. How very thoughtful of them; Ban Ki-Moon Not all he’s known for.

#75 Andrew Woburn on 08.11.14 at 11:11 pm

Silly me. I thought bushes were yesterday’s foliage, both politically and otherwise. Who knew?

#76 45north on 08.11.14 at 11:23 pm

Vince : Do you have a chart for major urban cities like you had a global overview with charts?

et voilà

http://www.nytimes.com/interactive/2014/01/23/business/case-shiller-slider.html?ref=business&_r=0

for instance New York dropped 21% from the peak

Boston had the smallest drop, I mean one of the smallest drops

government stimulus is the most important aspect of real estate and there is no direct comparison of US and Canadian programs. One of the most obvious problems is the quality of condo construction in Toronto

http://www.cbc.ca/doczone/episodes/the-condo-game

this has to make real estate less valuable

#77 CRA on 08.11.14 at 11:27 pm

We will only compare your stated income on this blog with your electronic tax return income if it was filed from the same IP address.

Regards,

#78 Mark on 08.11.14 at 11:32 pm

The average Canadians net worth is over $440 000.

…………………………………………………………………..

What a crock of shit

Remember that’s ‘average’. Most of that net worth is concentrated amongst the old. The $440k figure refers to a ‘household’ which, is nominally 2-3 people. And most of it is tied up, as Garth points out, in low-returning real estate and bank deposits. Even the mutual funds may very well be, per the ‘advice’ of financial advisors, invested significantly in bonds and other low-returning ‘fixed income’ sorts of investments.

If you compare Canada and the USA, the business ownership culture is like night and day. Canadians are just a bunch of sleepy people who see little wrong with being effectively robbed of their wealth, while Americans like to grow it, or at least die trying. No wonder our brightest and more entrepreneurial, in such a culture of mediocrity, get out of Canada as fast as they can.

#79 Andrew Woburn on 08.11.14 at 11:32 pm

#53 Flawed on 08.11.14 at 8:45 pmEnjoying a wonderful CHEAP dinner in Paraguay right now that has low taxes and a non-corrupt govt. Will move wife and kids within the next 12 months. Probably to Uruguay.
======================

Apparently “corruption” is a word with variable definitions. Your definition would apparently qualify you for high office in the PRC.

Although Paraguay’s dictator-for-life Alfredo Stroessner has been gone for quite a while, his legacy lives on in Ciudad del Este. “Non-corrupt” governments don’t tolerate such places.

If you take up residence, you may want to keep your money somewhere else.

“Ciudad del Este’s deadly trade route”

http://www.ft.com/intl/cms/s/2/dd80bec8-2be5-11df-8033-00144feabdc0.html#axzz3A8zNx78s

#80 };-) aka Devil's Advocate on 08.11.14 at 11:35 pm

#74 Fed-up on 08.03.14 at 9:26 pm
#54 Cha Ching on 08.03.14 at 8:31 pm
It’s obvious that Steve doesn’t know anything about real estate if he’s comparing property in a dodgy zip in Las Vegas to Toronto and/or Vancouver as a whole. That kind of ignorance is the cornerstone of real estate hater knowledge. That is why they’ve been frustrated for almost 2 decades as real estate prices have risen, and continue to rise across Canada.
I feel sorry for him. But at least people like that can always find a landlord to take their money…
————————————————————————-
So your opinion is that real estate is justifiably worth 10 times more in Dampcouver and Moronto.
Got it.

If by Dampcouver (lame) you mean Vancouver… abso-efin-lutely. Moronto (Toronto) not so much };-)

Unfortunately for us otters basking in the West Coast the rest of the world, including Toronto, is learning our secret and heading our way. Wanna talk about HAM in Vancouver… everything in Kelowna. The cultural mix is getting so strong here anyone of any nationality can walk a block on a warm summer eve without hearing their native tongue. BUT… there is a price of admission… and trust me many, too many, are prepared to pay it. And so… prices rise.

SHIFT happens

};-)

#81 nonplused on 08.11.14 at 11:41 pm

Well I am obviously not in your top 1%, but I am doing ok for my age. No debt, not even mortgage, follow your 90 minus age rule, what not. Be nice if I had a steady job but still making steady enough income.

Wife has a job too so combined we are doing ok. Lots of things to pay for including kids off to university and one left in the nest who needs camps all summer and hockey and music all winter. Yikes! Lots of money going out.

But I certainly don’t have $3 mil in investable assets. Yikes! Neither does anybody I know! We are all trying to figure out how 2 mil, if possible 10 years from now, might do. It doesn’t look good. We all have math backgrounds so 2 mil is the agreed upon number you have to get to. How people go in with 300 in equity in their house we don’t understand, must be planning to inherit money. We don’t. Parents are broke, more likely to be a drain once the reverse mortgage runs out.

I’ve already prepped my parents that since they gave lots of money to my sister including buying her a house and I got nothing to look after my kids, they know who’s looking after them when the reverse mortgage runs out and it isn’t me. Brutal yes, bastard so I am, but they need to know. I have my kids to look after and my own ass. They didn’t help me when I was in need and frankly that made me much more resourceful. But they gave my sister a free ride, she doesn’t even have to work. Sorry, I am not paying for those decisions, and call me what you will.

#82 OffshoreObserver on 08.11.14 at 11:43 pm

#8 Financial Freedom at 40 on 08.11.14 at 5:55 pm

Speaking of the CRA, how’s our favourite David fighting Goliath, Mr Leroux?

————————————–
Here’s Irvin Leroux’s website: http://lerouxed.com/PRESS_KIT.html

#83 tkid on 08.11.14 at 11:43 pm

#70, your mistake is thinking the only stable home for a family is a house/condo the parents have bought. What makes for a stable home isn’t the house, it’s the parents.

And learning the basics of investing, saving, staying out of debt and then practicing what you’ve learnt isn’t going to be the ruin of anyone. Quit mistaking investing for ‘losing your shirt buying penny stocks.’

#84 DJB on 08.11.14 at 11:44 pm

How about the average of $30,000+/- in LOC and CC debt is that included in the amount? Or future lease obligations in high end automobiles?

#85 Tom from Mississauga on 08.12.14 at 12:20 am

My SIN is at the Great Alaskan Bush Co. What happens in Alaska…

#86 };-) aka Devil's Advocate on 08.12.14 at 12:21 am

#83 tkid on 08.11.14 at 11:43 pm
#70, your mistake is thinking the only stable home for a family is a house/condo the parents have bought. What makes for a stable home isn’t the house, it’s the parents.

And learning the basics of investing, saving, staying out of debt and then practicing what you’ve learnt isn’t going to be the ruin of anyone. Quit mistaking investing for ‘losing your shirt buying penny stocks.’

Oh I understand well enough what makes for a stable home for a family. We have raised some awesome young adults through making sacrifices others appear unprepared to have made. Things like having a “stay at home mom”. Things like keeping the kids in the same school catchment area throughout grade school so they could maintain friendships and have a sense of security. Things like making sure no one could pull home out from under, for whatever reason, us because we were renting. Things like maintaining a balanced budget.

Don’t kid yourself tkid, we know what it takes to raise a family and have the children, now young adults, who are contributing to our society more than they take from it.

#87 AACI-home dog on 08.12.14 at 12:37 am

Re: 81, nonplused…
I think I will call you non-plused. I was in same boat, but came out well & more proud.

#88 };-) aka Devil's Advocate on 08.12.14 at 12:46 am

#83 tkid on 08.11.14 at 11:43 pm

You are absolutely correct; home ownership is not the be all and end all to creating a stable home, but it is a BIGGIE.

REALTORS get to see a lot of the behind the scenes shit that goes on in families. In my observations there is a whole lot more incidence of a whole lot more shit going on in rented homes than in owned homes. I could speculate why but suspect if many of those parents who rent would get their shit together such that they could, if they wanted to, buy a home that mere act might make all the difference in the world. Ergo, home owners, by my observation, are a lot more responsible lot with the skill sets necessary to raise a family in a “stable environment”.

Sorry to generalize but renters are by and large slackers. You may be one of the exceptions but that doesn’t change the overwhelming norm in that group.

#89 kILlaBoY50 on 08.12.14 at 12:49 am

I’m not worried – all my money has been declared and heavily taxed.

#90 };-) aka Devil's Advocate on 08.12.14 at 12:52 am

Seriously, renters are typically so irresponsible I won’t list a rented home unless I get to interview and approve the tenants. Most don’t pass.

#91 cynically on 08.12.14 at 2:05 am

#78 Mark – I totally concur with your second paragraph and until Canadians understand this nothing is going to change. Ii’s a shame because we have the intelligence but seem to lack the initiative to think and act differently. There are many who have crossed the border and succeeded beyond even their hopes and aspirations and should be held up as examples of what a change, not in environment but in thinking, can accomplish.

#92 Setting the Record Straight on 08.12.14 at 2:12 am

““There are 320,000 rich people in Canada who have (outside of their principal residences) $1 million in investible assets. ”

Zut alors, the Occupy movement was very accurate! They really are only 1%!”

Garth just stop it! $1 million is not rich. Invested for income, to return say 5 percent, produces a magnificent 50k per year.

You would need about $20 million to hit the easy button.

#93 Dr. Subprime CHMC TFOS on 08.12.14 at 3:24 am

Environics, one of the polling companies who have so accurately predicted election results all across the country. I believe much of what they say 19 times out of 20 with a margin of error between 5 and 90% depending on who is paying for the poll (they won’t reveal that so I just don’t believe them).

#94 sierts on 08.12.14 at 6:24 am

@ #53 Flawed

be prepared to loose about 3/4 of your wealth – as a kind offee for learning the different set of rules.
after that you may (may!) prosper down here.

p.s.: i am eating expensive dinners in paraguay, because i have to earn my money here.

it’s the old newbee trap. everything looks cheap, because of distorted money change rates.

#95 Chickenlittle on 08.12.14 at 7:31 am

RIP Robin Williams…..

The Birdcage: best movie ever!

#96 Temporary Foreign Prime Minister on 08.12.14 at 8:26 am

#4 Randy on 08.11.14 at 5:50 pm
Wondering if all of the gold-plated defined benefit pensions for public servants are sustainable ?
=========================

Remember when nurses, teachers, firefighters, and municipal workers crashed the economy, wiped out trillion$ of middle class equity, and took million$ in bonuse$ and bailout$?

Me neither.

#97 Crossbordershopper on 08.12.14 at 8:27 am

why doesnt Garth speak the truth about Canada. It is run by the 50 families, the government and the banks and insurance companies. Everyone else is a serf. They dont tell the immigrant that when the show up at Pearson from Air Jamica flight 219, but its true. You come here you get a job or something, your kids go to school, its relatively safe etc, but know your role and dont think your going to build anything like really big. Canada has been set up this way since Upper Canada. You have to know your past to know your future. Canada is great, you dont have to work to hard and you get the basics looked after. The idiots who want to drive up and down the 401 every day of their life to own 100 sheets of drywall and a skid of 2 by 4’s and the cheapest plywood you can get assembled in a house go ahead. They should of stayed on the beach in Kingston in the end of their life.

#98 jess on 08.12.14 at 8:43 am

“Confidential Witness A”
Lawsuit Stunner: Half of Futures Trades in Chicago Are Illegal Wash Trades
…” Wash trades occur when the same beneficial owner is both the buyer and the seller. Wash trades are banned under United States law because they can falsely suggest volume and price movement.”
By Pam Martens: July 24, 2014

FOIA – freedom of information act

on AIG…
…” Mark Pittman, a reporter for Bloomberg News, filed a Freedom of Information Act request for information about those loans in 2008, the Fed stonewalled turning over the information. Bloomberg News filed a federal lawsuit to obtain the information on November 7, 2008. After both a Federal District Court and the U.S. Court of Appeals for the Second Circuit had ordered the Federal Reserve to release the information, it still refused.”…
http://wallstreetonparade.com/

living wills /too big to fail
By Pam Martens: August 11, 2014
plead the fifth and redaction
http://online.wsj.com/articles/under-sec-questioning-jokes-and-jitters-1407792157

#99 Nick Roerich on 08.12.14 at 9:10 am

Garth, this comment was actually meant for this post not “Generations” — our bad.

The recent revelation below just adds more fuel to the fire of middle class wealth destruction … as well as to the 1% wealth accumulation.

“New Toxic Derivative Launch By Goldman Sachs: “The Credit Bubble’s ‘Final Frontier’”

http://themillenniumreport.com/2014/08/new-toxic-derivative-launch-by-goldman-sachs-the-credit-bubbles-final-frontier/

#100 rosie "moving forward" in the knowledge that, "this won't end well" on 08.12.14 at 9:15 am

Canadians are hopeful, so long as their homes increase in value and they get a raise. When assets decrease in value and jobs stagnate then they’re just a bunch of liars.

http://www.bnn.ca/News/2014/8/12/Survey-finds-honesty-not-always-the-policy-for-some-loan-applications-.aspx

#101 Big Ed on 08.12.14 at 9:18 am

#40 Bob on 08.11.14 at 8:01 pm
@BigEd

I’m not sure why some owners think the only thing to rent is a mouldy basement suite. I’m happily renting the top floor. When this house of cards collapses some of these over stretched homeowners will be in the basement while I’m renting the top floor and they are throwing in the garage as an incentive to sign a lease.
++++++++++++++++++++++++++++++++++

To Bob, I was not trying to insult anyone who rents, I just wanted to show an extreme (mouldy basement). The focus was meant to be strictly on the numbers.-Big Ed

#102 Macrath on 08.12.14 at 9:29 am

Since 1961, the average family’s tax bill has rose by 1,832%, dwarfing increases in the costs of housing, clothing and food.

Canadians pay 42% of income in tax — more than they spend on food,shelter and clothing.

http://tinyurl.com/nq3c4as

How much can the Government bleed the citizens before there is serious social unrest ? 60% ~ 80% ~100% ?

#103 T.O. Bubble Boy on 08.12.14 at 9:30 am

@ #66 Rexx Rock on 08.11.14 at 9:49 pm
I bet the Yanks are pretty jealous that average Canadians net worth is over $440 000.Just goes to show them we are now way better off because of our booming economy.
———————————————-

Are you a parody poster?

Americans creating 200k+ jobs per month, Canada zero.

Our “booming economy” is based on more and more debt buying home renos and condos and even cars on 8-yr financing – not exactly a sustainable model.

#104 Nick Roerich on 08.12.14 at 10:00 am

This article reveals the new generation of stealth derivatives that will further decimate the middle class … and make the 1% all the richer –>

New Toxic Derivative Launch By Goldman Sachs: “The Credit Bubble’s ‘Final Frontier’”

http://themillenniumreport.com/2014/08/new-toxic-derivative-launch-by-goldman-sachs-the-credit-bubbles-final-frontier/

#105 WhiteKat on 08.12.14 at 10:10 am

Go Canada Go! The world will be watching this fight between Canada and the USA. This could be world changing. Canadians file lawsuit to Block FATCA and prohibit handover of “U.S. Persons” to IRS!

This lawsuit is accompanied by a separate submission (August 7) of a complaint to the United Nations, by concerned citizens worldwide, that the unique U.S. style ‘place of birth taxation’, for which FATCA is an enforcement tool, violates fundamental human rights.

http://www.forbes.com/sites/robertwood/2014/08/12/canadians-file-suit-to-block-fatca-and-prohibit-handover-of-u-s-names/

http://isaacbrocksociety.ca/2014/06/01/its-time/

#106 Bottoms_Up on 08.12.14 at 10:29 am

Cheese has gone done it again. What use to be 500 gram packages are now 460g and 450g.

Existential question: how small can they make the large packages before the large package ceases to exist?

#107 Bottoms_Up on 08.12.14 at 10:30 am

#97 Crossbordershopper on 08.12.14 at 8:27 am
————————————————–
One only needs to look at the “Bank of International Settlements”, and whom sits on the board (all the heads of all of the central banks) to know who really controls things.

#108 Rusty Venture on 08.12.14 at 10:32 am

crowdedelevatorfartz;

“The most brilliant propagandist technique will yield no success unless one fundamental principle is borne in mind constantly – it must confine itself to a few points and repeat them over and over.”

In the U.S. context:

http://www.rollingstone.com/politics/news/looting-the-pension-funds-20130926

#109 Bottoms_Up on 08.12.14 at 10:35 am

#4 Randy on 08.11.14 at 5:50 pm
————————————–
Randy, the answer to your well-thought-out question is ‘yes’.

Now look at something you really should be concerned about:

1) erosion of benefits of middle class workers
2) full time jobs being traded for part time
3) wage gains not keeping pace with inflation
4) is the calculation of inflation reflective of reality?
5) the growing gap between rich and poor (re-read Garth’s post)

#110 Rational Optimist on 08.12.14 at 10:37 am

9 Big Ed on 08.11.14 at 5:56 pm

“Garth this makes no sense to me at all. So, if I have 1 million investible assets and rent a mouldy basement bachelor I am rich.

But if I have a paid off home worth 800,000 and another 800,000 in investible assets I’m not rich???”

In the first case, you’re a genius. If that bachelor rents for 500 a month, you’ve got another fifty grand every year to live it up, go travel, whatever you want. If you decide you want to globe hop a bit more than you already do, give 60 days’ notice and trade in the bachelor for a storage unit for your things.

In the second case, the carrying costs of an $800,000 mean that you’ve still got to work, even with $800,000 invested. Which means you’ve got to pay for a car; buy clothes and haircuts; buy expensive drinks on Fridays with people you don’t like; so on and on.

So, yeah, I guess you got it right…

#111 Smoking Man on 08.12.14 at 10:49 am

#60 Cici on 08.11.14 at 9:27 pm
#1 Big Ed

There’s nothing to worry about silly, the lap dances are at the Great ALASKAN Bush Co.

Now, where do us gals go to see the wieners wiggle?
………….

I know a place, no cover charge either… Called Wards
Island.. I just go on my boat, however you can take a fairy to the island.. That was not meant as a pun…

An abundance of wigglees … I find it rather gross, but it’s the
price I pay when researching melons… Few and far between.. But always in pairs….

#112 Mister Obvious on 08.12.14 at 11:07 am

#78 Mark

” No wonder our brightest and more entrepreneurial, in such a culture of mediocrity, get out of Canada as fast as they can.”
——————–

But for the average Canadian I see no need to leave since there is always the option of investing in the USA or anywhere else in the world for that matter.

If one is properly diversified only a carefully considered portion of one’s net worth will be invested in Canada.

Ultimately success depends less on how much money you earn and more on how much you save and invest.

In Canada, you can earn enough, to invest enough, to do very well in the long run. Especially if you avoid things like real estate bubbles and such.

#113 tkid on 08.12.14 at 11:14 am

Seriously, renters are typically so irresponsible I won’t list a rented home unless I get to interview and approve the tenants. Most don’t pass.

How terrible for you to have so utterly demeaned yourself by chatting with me. I am entirely distressed to have caused you such pain, and apologized profoundly for having spoken with you; it won’t ever happen again.

Perhaps if you bathe yourself in peroxide for a week you’ll be able to cope again in polite (owners-only) society you freakin’ jackass.

#114 JimH on 08.12.14 at 11:20 am

#78 Mark on 08.11.14 at 11:32 pm

The average Canadians net worth is over $440 000.
…………………………………………………………………..
What a crock of shit… &etc.
=================================
X2

#115 Financial Freedom at 40 on 08.12.14 at 11:23 am

#70 Devil’s Advocate

Of course according to your reader survey your readers are “the wealthy” and so they must come here for that financial advice. But if that is truly so, why is it that such a large contingent are, “apparently”, so happy to be renting instead of owning? Something just isn’t adding up.

______________

How can you be here, day after day, and week after week and not get it?

Buy low sell high.

When houses are obviously in a bubble, in certain markets, sell, don’t buy, pocket your gains or continue to save. Put those gains/savings into something that has greater liquidity and upside potential. Rinse and repeat.

‘Housing’ comes in many forms – you don’t always have to own it, at all times, or leverage to get it.

Yes, we’ve had a great run on housing, there’s probably still some money to be made in select properties in select places. The millennial hornies, with years of unpaid internships and expensive education padding, buying slapped together cereal boxes, with boomer mom’s money, in mud fields, doesn’t bode well.

I come here for the sound, time-tested, investment-agnostic principles and the creative thought-provoking choices (when I have to look up an acronym or check a new chart it’s been a fruitful night in the comments section).

Are you anticipating and riding the SHIFTS or waiting for them to “happen” and stuck in reactive mode?

Early bird gets the worm.

#116 miketheengineer on 08.12.14 at 11:32 am

#108 Bottoms Up

I did a comparison of the “average” wage in 2000 and in 2013, verus the “average” price of gasoline in 2000 and in 2013. Guess what, when I calculated it out, the average wage was “short” about 3 dollars per hour….ouch that hurts…and this would explain why people are not as good off as they were before, since they are spending more with taking home less.

Just like Garth has been saying, the “squeeze” is on.

#117 Suede on 08.12.14 at 11:36 am

So taxes in Canada have gone up 1832% from 1961 to 2013.

https://ca.finance.yahoo.com/blogs/balance-sheet/canadians-spend-more-taxes-basic-needs-report-103743076.html

That’s more than housing!

Garth, how do we profit from increasing taxes here?

#118 Ogopogo on 08.12.14 at 11:43 am

#62 };-) aka Devil’s Advocate on 08.11.14 at 9:37 pm

Robin Williams – he will be missed

Lucky for us, we have you as blog clown.

#119 Flawed on 08.12.14 at 11:58 am

#96 Temporary Foreign Prime Minister on 08.12.14 at 8:26 am
#4 Randy on 08.11.14 at 5:50 pm
Wondering if all of the gold-plated defined benefit pensions for public servants are sustainable ?
=========================

Remember when nurses, teachers, firefighters, and municipal workers crashed the economy, wiped out trillion$ of middle class equity, and took million$ in bonuse$ and bailout$?

Me neither.

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

Thank you for cherry picking 7% of the public sector. Now how about telling us why we should be paying a pension to the other 93% of most unproductive workers in the country and have 60% taxes here in BC to show for it.

#120 JimH on 08.12.14 at 12:09 pm

#71 Cha Ching on 08.11.14 at 10:18 pm
“Warren Buffett is holding $50b in cash ‘earning nothing’. Canadians are in good company.
Canadians are rich. Specifically homeowners and Boomers. The rest are just jealous. And poor.
Sorry. Truth hurts.”
=================================
What a silly and ignorant comment. It reveals your total lack of understanding of the way Buffett and Berkshire Hathaway operate.

Yes, Berkshire Hathaway has a cash hoard of some $50B; well over $20B of which was accumulated over the last year due to Buffett’s wise ‘Buy American’ strategy that was ramped up into overdrive in 2009.

The strategy is simple: build up a financial ‘war chest’, and then use it for strategic, well-timed Acquisitions. Buffett was able to buy BNSF, NV Energy, Lubrizoil, and a big chunk of Heinz.

BTW, Berkshire Hathaway ALWAYS maintains a cash hoard of at least $20B, neatly tucked into the insurance holdings for contingencies. This is not news. (BTW, BOA has over $120B in cash reserves, but that’s a different sort of cow)

At present therefore, Buffett has ~$30B to play with. Rumors abound as to what he has in the cross-hairs; John Deere? Dover? Cummins? Aflac?

Yes, the truth hurts… but only the stupid and ignorant: Like those who think for a moment that Buffett accumulates cash so it can sit and “do nothing”. You’re a joke!

#121 Flawed on 08.12.14 at 12:09 pm

Since 1961, the average family’s tax bill has rose by 1,832%, dwarfing increases in the costs of housing, clothing and food.

Canadians pay 42% of income in tax — more than they spend on food,shelter and clothing.

http://tinyurl.com/nq3c4as

How much can the Government bleed the citizens before there is serious social unrest ? 60% ~ 80% ~100% ?

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

It’s already 60% in BC when you include:

MSP (free healthcare? Not)
multiple tax on tax gas taxes
PST
GST
Bridge Toll (thanks for the two week party in 2012 !!)
phony carbon tax (no carbon tax to a billion lbs of coal going to China to burn dirty).
Property tax (for striking teachers)
Eco tax (for what?)
BC Hydro – OUR hydro but HUGE bills – here in Paraguay electricity is practically free because of their Hydro dam. In BC…..they charge the shit out of you.

And the list goes on and on and on…….Welcome to SCAM BC…….the best place to find HAM on earth !!

#122 JimH on 08.12.14 at 12:28 pm

Any traders here watching the Baltic Dry Index?

http://stockcharts.com/h-sc/ui?s=%24BDI

I like the looks of the Guggenheim Shipping ETF (SEA; NYSE) if it can put in a higher low or break-out above its 25 day MA.

Not a recommendation; just something to consider if you want to diversify into the beat-up ship trannies.

#123 Long Time Lurker on Here on 08.12.14 at 12:32 pm

It’s sad that most Canadians have adopted a one asset strategy. But the reality is, majority of the people out there do not have a PHD in economics, buying physical asset is the easiest way for them to “invest”. Guess what, it has worked really well for most of them too. People also like to stick to what worked for them. In the past 10 years, those who bought/sold properties did really well and the same people are likely to employ the same strategy until they are burned.

#124 soop nazi on 08.12.14 at 12:57 pm

#105 BU …….I’m sure everyone has noticed the stealth infaltion you’re referring too….except of course…the BOC Gov…Prozac Poloz……Mr Inflation Denier himself.

Everything in a package or a can is now 30 to 50% smaller than it was ten years ago…..and yet the prices continue to go up. Even the additives have gone Chinese on us…..now it’s common to read that some incomprehensible filler product has been substituted in place of food…like in bread etc. Burger patties are now a higher percentage of filler than they are meat.

As was already pointed out taxes to pay for our civil service elites wage and pension plans have gone up 1800++% leaving less and less to live on.

Might we be well on our way to hell in a hand basket if people are forced into starvation while they see the civic servants elite fattening grotesquely in the public trough?

#125 John on 08.12.14 at 1:08 pm

#95 Chickenlittle on 08.12.14 at 7:31 am

RIP Robin Williams…..

The Birdcage: best movie ever .
————————————————————-
Hated that movie made me question my sexuality.
It looked like the other team was having way to much fun LOL

#126 jess on 08.12.14 at 1:44 pm

Press Release
SEC Charges Kansas for Understating Municipal Bond Exposure to Unfunded Pension Liability
Enforcement Action Stems From Nationwide Review of Muni Bond Disclosure
http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370542629913#.U-lFz6PhtbI

#127 Sheane Wallace on 08.12.14 at 1:46 pm

It is scary how stupid he is:

https://ca.finance.yahoo.com/news/canada-finance-minister-says-watching-housing-not-alarmed-170540967–business.html

#128 Victor V on 08.12.14 at 1:56 pm

Finance Minister Joe Oliver says watching housing, not alarmed

https://ca.finance.yahoo.com/news/canada-finance-minister-says-watching-housing-not-alarmed-170540967–business.html

Wakefield QUEBEC (Reuters) – The Canadian government is closely monitoring the country’s still strong housing market, but is not alarmed by its growth, Finance Minister Joe Oliver said on Tuesday.

The finance minister also said the federal government is still on track to balance the budget next year.

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

Nothing to see here. Move along.

#129 Victor on 08.12.14 at 2:08 pm

TO #56
the report says SU-25 did that.
http://www.fighter-planes.com/info/su25.htm
SU-25 provides close air support, against tanks and anything on the ground. Heavily armored, ceiling around 23000 feet.

#130 Vlad on 08.12.14 at 2:27 pm

With so many wealthy people posting on this blog, I’m a little intimidated. Maybe you should have sub blog for us poor people. Kind of like the new condos with a side door for the riffraff to use. My SIN # is 345 925 467

#131 NotAGreaterFool on 08.12.14 at 2:43 pm

Furtehr to Garth’s point, BMO says those aged 45-64 (who are known as being ‘sandwiched’ between the demands of caring both for their aging parents and for their own children), are more than half a million dollars short of their individual retirement savings goal.

http://newsroom.bmo.com/press-releases/stuck-in-the-middle-bmo-nesbitt-burns-study-finds-tsx-bmo-201408120962096001

Time to sell the houses!

#132 Smoking Man on 08.12.14 at 2:55 pm

Teranet numbers out tomorrow at 9am, I’ll put the stats in my bubble meter, and let dogs know if I see a hockey stick.

#133 Snowboid on 08.12.14 at 2:55 pm

#112 tkid on 08.12.14 at 11:14 am…

Good response! The golden-poodle of Okanagan/Shuswap real estate is so full of SHIFT®, he forgot to take his meds again.

He told us years ago how he sold his rental properties – but now regrets it. I guess it’s possible he got a HELOC and bought one of the many foreclosures, as our agent told us most ‘good’ foreclosures are snapped up by agents.

Maybe he turned his home back into a B&B again, then it’s fairly easy to interview the ‘clients’.

If he hasn’t he should reconsider, many of the B&Bs along the lake have gone under in the last couple of years – a good business opportunity.

Either way, he lacks any understanding of the current rental market in Kelowna. In the luxury complex we live in almost 1/3 are renters. There are more problems with owners than the renters, without a doubt.

If he follows his standard progression, he will soon start hurling personal insults and get banned again.

On a lighter note, enjoy an lighter Albertans’ perspective on Kelowna!

https://www.youtube.com/watch?v=t-FKQsXgCTg

#134 rosie "moving forward" in the knowledge that, "this won't end well" on 08.12.14 at 3:05 pm

Shangri-LOL

http://www.thestar.com/news/gta/2014/08/12/shangrila_ordered_to_ban_guests_from_balconies_construct_fallingglass_barriers_over_sidewalks.html

#135 NotAGreaterFool on 08.12.14 at 3:12 pm

We’re so screwed…

1st CMHC provides useless data and now we learn we have Stats Can. has no clue what the jobless figures are

http://www.statcan.gc.ca/daily-quotidien/140808/dq140808a-eng.htm

How is this possible?

#136 JimH on 08.12.14 at 3:32 pm

#129 Vlad
“With so many wealthy people posting on this blog, I’m a little intimidated. Maybe you should have sub blog for us poor people. Kind of like the new condos with a side door for the riffraff to use. My SIN # is 345 925 467”
==================================
Don’t you have special dispensation?
Go… and SIN no more, my son.

#137 JimH on 08.12.14 at 3:45 pm

Attention Snowbirds:
From the KeatsConnelly website:
“In a welcome development for those living (or hoping to live) a cross-border lifestyle, US Customs and Border Protection (CBP) has made live an online database to Canadian visitors listing every entry into and exit from the United States on record in the past five years…”

more here: http://www.keatsconnelly.com/2014/06/check-your-border-crossing-records/

This might avoid some hassles in the future.

#138 rosie "moving forward" in the knowledge that, "this won't end well" on 08.12.14 at 3:56 pm

Shangri-LOL just keeps on giving. 31 listings on remix, 20 listings on kijiji. Nice view, I guess, but it’s hard to see through the sliding doors.

http://www.buyselltorontorealestate.com/index.php?p=2&io_mdist=A&io_districts=A&io_for_sale=1&io_for_lease=1&io_hometype=condo&io_st_name=180+university&io_min_bedrooms=0&io_min_bathrooms=0&io_min_kitchens=0&io_dir=desc&io_min_price=&io_max_price=&io_ml_num=

#139 Bottoms_Up on 08.12.14 at 4:09 pm

#113 JimH on 08.12.14 at 11:20 am
—————————————
Notice the wealth article didn’t quote the ‘median’ wealth statistic.

As everyone knows, the rich are getting richer. Thus, the average is going to go up.

But what about the median?

It’s a damn shame the media/MSM doesn’t appear to have one journalist with a firing neuron to dissect what the report really means.

We should all be thankful for our gracious host whom is able to shed light on news releases such as these.

#140 Bottoms_Up on 08.12.14 at 4:10 pm

#115 miketheengineer on 08.12.14 at 11:32 am
———————————————-
So whom benefits from lower effective wages?

Thanks for sharing the results of your analysis.

#141 };-) aka Devil's Advocate on 08.12.14 at 4:18 pm

#112 tkid on 08.12.14 at 11:14 am
Seriously, renters are typically so irresponsible I won’t list a rented home unless I get to interview and approve the tenants. Most don’t pass. – DA

How terrible for you to have so utterly demeaned yourself by chatting with me. I am entirely distressed to have caused you such pain, and apologized profoundly for having spoken with you; it won’t ever happen again.

Perhaps if you bathe yourself in peroxide for a week you’ll be able to cope again in polite (owners-only) society you freakin’ jackass.

No problem. Not all renters are irresponsible – just most. You may be an exception to that generalization. My practice of not listing rented homes without first interviewing and approving the renter is purely a business matter. Renters too often can be a royal pain in the ass to deal with. Too often they thwart a sale and that costs me and the owner money. Just don’t want to get involved in that mix. You think Millennials as a group have entitlement issues… they don’t compare in the remotest to renters.

#114 Financial Freedom at 40 on 08.12.14 at 11:23 am

How can you be here, day after day, and week after week and not get it?

Buy low sell high.

Are you anticipating and riding the SHIFTS or waiting for them to “happen” and stuck in reactive mode?

The market is always SHIFTING yet trying to time those SHIFTS is a fools game – no just in real estate but in any investment. Are you speculating or investing?

In real estate there is what we call a “safe zone” in which to buy and sell (get in the market or get out of it). Do you know when that is? If you are in the market and not planning on leaving the market then it’s generally all good as you are riding the SHIFTS ergo… SHIFT happens, get over it. Which is to say all the banter on this blog about the fluctuations in real estate are, for those of us who are in and plan on staying in the market, inane.

#117 Ogopogo on 08.12.14 at 11:43 am

#62 };-) aka Devil’s Advocate on 08.11.14 at 9:37 pm

Robin Williams – he will be missed

Lucky for us, we have you as blog clown.

To put me in company of Robin Williams, even in the remotest, is a great compliment. Thank you };-)

#132 Snowboid on 08.12.14 at 2:55 pm

He told us years ago how he sold his rental properties – but now regrets it.

Yup, that was an educational moment. Remember 2008 we all thought we were staring down the shotgun barrel of economic Armageddon. In great part due to Garths influence back then in 2008 (6 years ago) I thought it best to get rid of unnecessary real estate holdings which were purported poised to drop substantially in value and get rid of all debt coming into that anticipated dangerous economic time. Didn’t pan out that way at all. The only one who came out ahead in that deal was the tax man to whom I paid capital gains. But you go ahead and heed Mr. Turners advice because clearly his crystal ball is all telling as it has been these past six years.

But I’m kewl with it as they say “an education is a bargain at any price” and that was an expensive education. Hopefully if you conduct yourself similarly you will be able to say the same.

SHIFT happens.

};-)

#142 Smoking Man on 08.12.14 at 4:19 pm

#128 Victor on 08.12.14 at 2:08 pmSU-25 provides close air support, against tanks and anything on the ground. Heavily armored, ceiling around 23000 feet.

That’s how far you research took you.? The available trust and wingloading on a bare bones Su25 could easily clime and maintain altitude of 31k feet.. It’s ground speed would also esaly catch up to it in the thinner air.

Through that argument out window if you must…

ATC recording seized July 17, They have had the black boxes since July 22..21 day… Nothing…

Seeing the way MSM and the Eu jumped on this from the get go… Do you not think if the evidence showed conclusive proof rebels did it, it would be out faster that you can step on an aint…

Its a cover up….. Pure and simple….

If you want to grow up rich, do your homework….

You didn’t do well with puzzles as a kid I’m assuming.

Stop it. — Garth

#143 DM in C on 08.12.14 at 4:27 pm

How DA is allowed to continue to spew horseshit like this is beyond me:

“Things like having a “stay at home mom”. Things like keeping the kids in the same school catchment area throughout grade school so they could maintain friendships and have a sense of security. Things like making sure no one could pull home out from under, for whatever reason, us because we were renting. Things like maintaining a balanced budget.

Don’t kid yourself tkid, we know what it takes to raise a family and have the children, now young adults, who are contributing to our society more than they take from it.”

You can only balance a budget when you own a house, eh. Such horseshit. You pile it so high you should be following the stampede parade.

We’ve moved numerous times (gasp) across the country, I’m a female (DOUBLE GASP) executive, we rented (gasp) and our boys are self-assured, contributing citizens with tons of friends – -in fact the 15 year old asked to get a job this summer rather than hang out and go to camp.

Gdam banned troll, go back under your rock.

#144 Toronto_CA on 08.12.14 at 4:30 pm

Whoopsie Doodle.

Revised numbers coming on Friday afternoon after everyone has left for the day. Are we taking bets here?

http://www.cbc.ca/news/business/statistics-canada-retracts-july-jobs-report-because-of-error-1.2734470

Higher or lower than zero new jobs?

#145 -=jwk=- on 08.12.14 at 4:31 pm

@137 too bad a judge just ordered the balconies at Shangri-LOL closed!

#146 rosie "moving forward" in the knowledge that, "this won't end well" on 08.12.14 at 4:56 pm

Shangri-LOL reminds me of that saying “pigs get fat hogs get slaughtered.” Let’s hope these hogs can fly.

http://missingfiles.majugi.com/uploaded_images/BaconBalcony-706864.jpg

#147 JimH on 08.12.14 at 5:06 pm

#138 Bottoms_Up
“… It’s a damn shame the media/MSM doesn’t appear to have one journalist with a firing neuron to dissect what the report really means.
We should all be thankful for our gracious host whom is able to shed light on news releases such as these.”
===================================
Damn straight!
Would it not also be enlightening that every MSM article or report would also have a disclosure statement attached that would inform the reader/viewer of just how much the outlet’s revenue is dependent on its eagerness to pimp the real estate industry!

#148 Kilby on 08.12.14 at 5:13 pm

https://ca.finance.yahoo.com/news/canada-finance-minister-says-watching-housing-not-alarmed-170540967–business.html

You hit the nail on the head here, how blatantly partisan is this fool….Keep things boiling until the next election “A steady Hand” Wow…..

#149 };-) aka Devil's Advocate on 08.12.14 at 5:44 pm

#142 DM in C on 08.12.14 at 4:27 pm

Don’t get so defensive. If you are renting and working and doing a great job of raising children give yourself a pat on the back for that is a feat no one can dis you for. Good on you.

All I was meaning to say was too many put “things” before their children. Too many have latch-key kids because both mom and dad work so they can buy a McMansion and all the accoutrements that go along with it – that or, on the other hand, go to the bar buy booze and cigarettes.

We wonder why housing is so expensive these days. Well when the average house is twice the size it was 40 years ago, has a man cave, a gym, double garage, elaborate finishes throughout, central air, underground irrigation, wired, and more doesn’t it figure that house would cost multiple times more than what an average house of 40 years ago might sell for offering so much less?

Supply and demand drives prices one way or the other and when society changed such that in most families both parents worked instead of one, well, I’m thinking, that did a whole lot to affect the supply / demand dynamics. Suddenly people had more to spend and so they did and then it became that they had to have more to be able to afford what they demanded as the minimum acceptable.

Yes you can raise a family in a rented house, a trailer or a tent if need be, but too often raising a family has become for too many secondary to satisfying personal wants and needs. Believe me I do have experience with this stuff don’t try splitting hairs with me for the sake of argument. You know I am right. If your kids are as great as you say they are you have too often seen the results of neglected kids in compare.

Sorry if I offended you. Congratulations on your hard work and good results. You are one of the few… you must obviously know that.

Spend as much time as you can with your kids they are whatever age they are for too short a time any there are no do-overs.

#150 Crowdedelevatorfartz on 08.12.14 at 5:48 pm

@#107 Rusty Venture

Excellent article, however………

While I agree that Wall street banksters deserve to be breaking rocks in Sing Sing.
It still doesn’t let Politicians off the hook for either making promises that cant afford to keep OR dipping into pension plans for money to top up budgets.

One complaint I have and it was mentioned in the article is,” For many state pension funds, a significant percentage of the kitty is built up by the workers themselves, who pitch in as little as one and as much as 10 percent of their income every year. The rest of the fund is made up by contributions from the taxpayer”

THAT is MY complaint.

WHY should I, as an uninsured pensioner, be expected to guarantee a govt employees pension?

My pension investments have taken fiscal hits with no garantees to me that a unnamed taxpayer out there will “top it back up” .

As for the argument that ” Govt employee pensions were negotiated in good faith”.
Where and when exactly did the public have a say in these negotiations? At the ballot box? nah. Because govt. depts. would threaten to shut down and strike if their demands weren’t met.

but I digress
Well I didn’t realize that speaking the truth was “propaganda”……
so be it.

I’m not the only overtaxed taxpayer that will want, no demand, some fiscal responsibility and fairness from our govts. Be it now or later.
The govt employee pension plans are like fiscal dinosaurs staggering through a looming ice age.

Too big to live on less. Too slow to react to rapid changes. Too stubborn to believe it can happen to them.

Good luck, You’re gonna need it.
:)

#151 };-) aka Devil's Advocate on 08.12.14 at 5:54 pm

#142 DM in C on 08.12.14 at 4:27 pm

Again congratulations and sorry if I offended you.

As per my post @ #88 “Sorry to generalize but renters are by and large slackers. You may be one of the exceptions but that doesn’t change the overwhelming norm in that group. Renters, by and large, deserve the bad rap they get. I’ve dealt with renters for over 30 years and while there are some awesome people who rent they are by far the minority. I typically don’t take rented listings because I know the most probable outcome. Just like I don’t swim with crocodiles – the outcome just isn’t worth the risk.

#152 Financial Freedom at 40 on 08.12.14 at 6:32 pm

RE #140 Devil’s Advocate

The market is always SHIFTING yet trying to time those SHIFTS is a fools game – no just in real estate but in any investment. Are you speculating or investing?
——–
A bit of both actually, depends on my appetite for risk at a point in time, and life stage.

Examining fundamentals and doing a little analysis, I chose to rent, not buy right now, in a bubble city where I work – therefore not ‘speculating’ on real estate there. I continue to hold real estate ‘investments’ elsewhere. Actively rebalancing to get the return on capital that meets my objectives. Low risk/low return, high risk/high return often pair up no?

No weighting of more than 15% in any one single asset class… no debt… wonder how long my dumb luck will hold out?

My game is restful sleep.

#153 Victor V on 08.12.14 at 6:38 pm

Shangri-La ordered to ban guests from balconies, construct falling-glass barriers over sidewalks

http://www.thestar.com/news/gta/2014/08/12/shangrila_ordered_to_ban_guests_from_balconies_construct_fallingglass_barriers_over_sidewalks.html

The City of Toronto has ordered the Shangri-La hotel and condo building to take immediate action to prevent injuries from falling glass.

The city issued the “order to remedy unsafe building” to the developer of the 65-floor Shangri-La tower on Aug. 5, demanding they install overhead falling-glass protection on the sidewalks around the downtown property.

The city also ordered the developer, Westbank Corp., to prevent the building’s condo owners and hotel guests from using their tempered-glass balconies until they can be wrapped in a protective netting to prevent them from falling.

The order comes after a pane of patio glass shattered and fell from the 51st floor of the luxury hotel and condo tower on July 17.

#154 };-) aka Devil's Advocate on 08.12.14 at 6:41 pm

#147 Kilby on 08.12.14 at 5:13 pm

Oliver also said the government was closely monitoring the country’s still strong housing market, but was not alarmed by its growth. Some financial commentators forecast housing prices could drop by up to 25 percent in the next few years.

They’re not concerned and neither am I. 25%? I think those financial commentators are awfully bearish. Could happen but again I not concerned as I am not speculating and I’m in the market with no plan on getting out. An erosion of 25% pales in comparison to the gains we’ve made over the last 10, 20, 30 plus years. Way better off than had we been renting all that time or even the last ten years of it.

If ifs and buts were candy and nuts…

Who knows what tomorrow may bring. You might get hit by a bus tonight and all your worries will have been meaningless. They say 90% of what people worry about never comes to fruition.

You’re all so concerned about chasing the almighty dollar… hope you’re all enjoying the chase for when you finally catch it… what then?

Enjoy the ride. We are all headed to the same destination some will just get there sooner than others – some a lot sooner than they expect.

You’re a teepee, you’re a lean-to… your too tense

SHIFT happens

};-)

#155 devore on 08.12.14 at 6:51 pm

#5 Big Ed

Living just about anywhere costs money-Big Ed

As an investment, real estate is unique in that even completely unleveraged, it continues to cost money in the form of taxes and maintenance, whether it earns any money or not.

#156 devore on 08.12.14 at 6:53 pm

#9 Big Ed

I’m confused.

You’re not. Your posts today clearly indicate you are being purposely obtuse and trolling. You know exactly what Garth is talking about.

#157 crowdedelevatorfartz on 08.12.14 at 7:02 pm

DELETED

#158 devore on 08.12.14 at 7:03 pm

#17 Shawn

The first guy does not exist. Or there are maybe 25 people like that around, statistically insignificant.

You’re right, the first guy does not exist. Anyone with means to amass such liquid wealth can afford to live above ground. There are plenty of well-off people, even millionaires, who rent their principal residence. Just as renting is not throwing your money away, neither does it mean living in a dank basement.

I rent a comfortable top floor unit in an apartment tower, with beautiful False Creek views (and the annual Celebration of Lights fireworks) out of my living room and spacious balcony, and amazing city/downtown view out of my full span bedroom windows. I can easily afford this, but do not even want to think what it would cost me to buy it.

#159 Victor V on 08.12.14 at 7:06 pm

Glass replacement on Shangri-La balconies could begin within weeks

http://globalnews.ca/news/1505093/glass-replacement-on-shangri-la-balconies-could-begin-within-weeks/

TORONTO – Construction workers will begin replacing the balcony glass of the Shangri-La within two weeks.

Through a communications agency, Shangri-La developer Westbank Projects said it had planned on replacing the building’s glass balconies even before the city demanded further testing after broken glass fell in July.

“In light of recent events, we have been working with the City of Toronto regarding the residential balconies at 180 University Avenue,” the statement to Global News said. “Prior to receiving the City order, Westbank had already ordered glass and initiated the replacement procedure.”

Westbank said it will start replacing the glass within 12 days. In the meantime, condo owners have been asked not to use their balcony.

#160 Victor V on 08.12.14 at 7:07 pm

The city orders the Shangri-La Hotel to protect all of us from its falling balcony glass

http://www.torontolife.com/informer/toronto-real-estate/2014/08/12/city-orders-shangri-la-hotel-protect-us-falling-balcony-glass/

After five separate cases of balcony glass shattering and falling from the side of the Shangri-La Hotel, the Star reports that the city has taken some decisive action. Following an August 5 “unsafe building” order, the fancy hotel/condo building (which also happens to be home to Momofuku’s restaurant complex) has to ban guests and residents from balconies until the glass is deemed safe. It’s also required to set up overhead protection on sidewalks below the property, so innocent pedestrians aren’t lacerated by razor-sharp pieces of someone’s $800,000 abode.

#161 Daisy Mae on 08.12.14 at 7:29 pm

Mr. Owe: “The Conservative government, which relied on large budget deficits to help Canada avoid the worst of the recession, projects it will have a surplus of C$6.4 billion in the 2015/16 fiscal year.”

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After the election in 2015, of course. And it’ll be another broken promise, natch.

#162 Done by Forty on 08.12.14 at 10:47 pm

Single points of failure can be found everywhere, it seems, including asset allocations.