The unimaginable

BUMP modified

Your Boomer mom won’t believe it, but there seems to be trouble brewing in the homeland. Given what the second half of 2015 is likely to deliver, the current real estate market might be sucking air. Here are a few things to worry about.

Mike’s a big RV guy. Even writes for a trade mag on the recreational toy industry. “Is this a harbinger of things to come in Canada?” his note to me asks. “RV/Boat/Motorcycles sales are highly discretionary as you know. I’ve been following these stats for years – this is very reminiscent of trends in US recreational vehicle market 6-12 months prior to 2007-08 implosion.”

You bet. Year/year motorhome registrations in Canada plunged almost 12% in April, says the latest report from Statistical Surveys. Adds Mike: “The important spring sales season in Canada is a complete dud so far…”

Hmm.

On Wall Street they’re also gearing up for blood in the gutters. Especially in YVR. New reports have emerged of global macro hedge funds building short positions in those things they think will be pummeled in the inevitable Canadian housing bust – including subprime lenders and the loonie itself.

This ended up in print yesterday, from a New York analyst: “All of the big macro funds that were involved in betting against the U.S. in 2007 and 2008 and 2009, they’ve all studied Canadian housing for a few years. I know a number of them are shorting Canadian housing. It looks like an accident waiting to happen.”

And you don’t need to be a suspender-slapping, slick, Porsche-driving, greed-is-good Wall Street wolf to be thinkin’ this way. Hell, Bank of Montreal is. The chief economist there, Doug Porter, says he understands why many are calling for a “deep correction” in Canadian house prices.

His chart tells you why.

BMO CHART modified

That flat line on the left is the ratio of Canadian to US house prices between 2000 and 2005 – they paced each other. Then our real estate soared irrationally while American values corrected, and lately they’ve resumed pacing each other (up about 5% a year). The trouble is that our housing is now at nosebleed level, especially give our economy (weak) versus theirs (snorting).

“This unusual period of symmetry follows a wild 10-year period which saw the U.S. market boom, then collapse, then finally recover strongly for a spell,” Porter writes. “What makes this recent period of relative calm between the two national markets so notable is that Canadian prices took about a 60% step ahead of U.S. prices in a six-year span from 2006-2012. Then, after a moderate step back, they have largely stayed there, far above their U.S. counterparts. It’s this gap that – to this day – has so many calling for a deep correction in Canada.”

Well, now let’s turn to some research by American economist and academic Nick Bunker, of the Washington Centre of Equitable Growth. This guy has a bubble fetish, and has examined all the major gasbag events back to 1870. He concludes that there are four kinds – stock market bubbles; stock bubbles based on excessive credit; normal housing bubbles; and leveraged housing bubbles.

Stock bubbles are a bitch, but usually don’t cause recessions when they pop. Even ones based on a lot of margin, like the dot-com bust. Housing market imbalances are normal, especially in a growing economy, but real estate bubbles based on debt instead of rising incomes are toxic, Bunker argues.

That, of course, is the kind we have right now. And it was the kind that imploded to the south and ate the American middle class. This is a very real danger to the wider economy which takes, on average, about five years to recover.

Why would a housing bust be so much worse than a stock market dump?

Simple. More people own real estate. Stocks and other financial assets are more often the preserve of the wealthy, or at least those with higher net worth – the impact is therefore more muted within society, and impacts people who have increased ability to absorb it, or are comfortable weathering fluctuations.

The credit-fueled housing crash, on the other hand, usually whacks those who have put most of their net worth into a single asset, then leveraged the bejesus out of it. They’re often living paycheque-to-paycheque without a lot of diversification or other financial resources. The impact is immediate and debilitating as equity vanishes, yet the debt remains. In short, they kneecap the middle class – those very people who spend the most, and support our consumer-based economy.

So the stock market can plop, and life on Main Street carries on. But when the housing market chokes, everybody’s nailed. They may even stop buying Harleys and RVs. How sad is that?

Of course, none of this can ever happen in Canada. We’re snowflakes. Special. The laws of economics do not apply here. It’s different. Joe Oliver says so.

So, basically, ignore the previous 821 words. Or prepare.

167 comments ↓

#1 zee on 06.25.15 at 6:17 pm

Hey Garth,

Your pal, Benny at CIBC, said there is no comparison our housing market to America’s and calls it irresponsible. He adds there is no crash. So keep on buying as long as rates stay low there is no problem.

#2 LH on 06.25.15 at 6:21 pm

Been thinking of target allocations lately. What do you think of the Yale model or Swensen approach?

And for this 31 year old with a 50 year+ term horizon:

30 percent public equities (15 U.S. 5 Europe 5 E.M. 5 other)

60 percent private equity / real businesses

10 primary residence net of leverage

Problem is, I am currently at 5-80-10 with 5 other (including 1.5% in gold which has been a total dud… Will keep what I have but won’t be adding unless gold goes back to 300-500 again)

#3 FatGuyinaBadSuit on 06.25.15 at 6:21 pm

First?!?!

Winter is coming.

#4 zedgt87 on 06.25.15 at 6:21 pm

I know Garth disagrees with me on this.

Not only do we have a Canadian housing bubble, we have debt fueled bubbles everywhere the eye looks including US housing and equities.

If anyone really thinks the correcting of a canadian housing is going to be an isolated event and your stock portfolio is going to come out unscathed are in for a shock.

Truly scary times

#5 ronh on 06.25.15 at 6:25 pm

Like a boil this needs to get popped. I’m seeing a lot
of RVs with for sale signs parked on the side of the road.
Trucks too. Toys go first.

#6 Jimmy on 06.25.15 at 6:27 pm

I want a meaningful correction to the market to bring it more back in line between LOCAL income and prices, but at the same time fear for my friends who have all bought within the past 10 years (a few bought SFH last year) here in crazyland Vancouver…

#7 Craig Cherlet on 06.25.15 at 6:30 pm

Primitus!

#8 JSS on 06.25.15 at 6:31 pm

“So, basically, ignore the previous 821 words. Or prepare.”

I want to prepare!!!

#9 rjrt81 on 06.25.15 at 6:32 pm

I can’t help but feel greatful my dad told me about your blog a few years ago. after nearly buying a condo twice in the yvr in the last few years, only to back out at the last minute. we now have abandoned all interest in buying. while we might be laughing stocks to some. my wife and i now have a diversified portfolio, 2 maxed out tfsa’s and are really looking forward to retiring early. while all those who caste judgement on us will be working until they are old and wrinkly. while i dont agree with you on many potical issues Garth. I can’t think of anyone giving better financial advice. you might remember that when you came to yvr and gave a talk my wife won a book and you commented that she had the nicest hand writting you have ever seen. thanks again Garth.

#10 North Burnaby on 06.25.15 at 6:38 pm

RV Homes? What a joke… It’s a freakin depreciating asset like your car!

#11 Mike T. on 06.25.15 at 6:40 pm

too late to prepare I think, this ship is sailing

don’t worry though, I am pretty sure this is what we are going to watch in 12-18 months

‘heroes’ from the East will expose ‘criminals’ in the West

the new heroes will be installed and become new criminals

the world will simultaneously change while staying the same

and the thing about the sun…. 39C in Kelowna Saturday, wow

#12 palebird on 06.25.15 at 6:40 pm

If Joe says so then it must be so..

#13 palebird on 06.25.15 at 6:41 pm

Oh yeah…furst…

#14 John on 06.25.15 at 6:43 pm

So what blew up at Lehman’s stocks or real estate? Or both lined up like ducks. So Greece is buried in a depression with 50% of the younger workers out of work …because real estate blew up? You mean that in 2008-09 the PTB scrambled and merged banks and threw trillions into the hopper…. because real estate blew up — first? And of course @ the Brisbane G20 (2014) – the PTB were given their marching orders to increase their Banks’ cash on hand so that the banks could carry on in case of a 30 day financial crisis….. cause housing prices are gonna blow… in all 20 nations..? So “F” blew a 40 year mortgage bubble, just to bubble housing and then blow it up in steps? Way ta’ go Joe O. Way ta’ go Poloz. Thanks Garth for your thoughts.

#15 Mocha on 06.25.15 at 6:43 pm

Prepare? Open a liquor store?

#16 John on 06.25.15 at 6:43 pm

Eh, first… next supper.

#17 Godth on 06.25.15 at 6:45 pm

I can’t wait. When does it happen?

#18 NH on 06.25.15 at 6:49 pm

Is there any way an average person can short the Canadian housing market ?

#19 takla on 06.25.15 at 6:50 pm

how bout a good old fashion stock market crash and housing collapse all at the same time.
Possible??Both are at their respective peaks and starting to tip,1/4 point interest hike may be the trigger.
Keep getting this feeling im going to go to bed one night and wake to a financial shitstorm in the morning.

#20 Chris on 06.25.15 at 6:52 pm

So, do I sell my rental house (currently bringing in 2k/month) or do I sell now?? House is in Cochrane (bedroom community of Calgary).

#21 not 1st on 06.25.15 at 6:53 pm

#4 zedgt87 on 06.25.15 at 6:21 pm

There is no spoon, I mean bubble.

Don`t worry, fed just re-inflating things a bit. Keep calm and carry on.

#22 MoneyDriven on 06.25.15 at 6:53 pm

“New reports have emerged of global macro hedge funds building short positions in those things they think will be pummeled in the inevitable Canadian housing bust – including subprime lenders and the loonie itself.”

How does a DIY investor with 100K portfolio would follow the big guys lead? Should one consider inverse ETF like “HFD Horizons BetaPro S&P/TSX Capped Financials™ Bear Plus ETF”?
What types of Canadian or US stock one would buy to rip the benefit from the correction or at very least ride the wave of Canadain correction without huge drop in Canadian portion of portfolio?

Thanks for your informative post as always.

#23 Annek on 06.25.15 at 6:54 pm

How does one short the Canadian housing market? I would like to do so as well. I would like to get in on the action!
At my workplace, out of 14 people, four have recently bought a house or condo. The rest already own. Everyone is congratulating the four that bought.
These people are health professionals. I wonder what they will be saying in a year’s time….

#24 Victoria Real Estate Update on 06.25.15 at 6:57 pm

Policy makers in the US did all they could to prevent prices from starting to fall as house prices peaked in 2006. When prices were falling fast they did everything they could to limit the depth of the correction.

Fortunately for the US it was possible to slash rates from near normal to emergency levels to limit the correction. We won’t see that happen in Canada as prices fall.

The major rate slash in 2009 turned some falling housing markets around in Canada (Vancouver, Calgary, Edmonton and Victoria) and resulted in blowing Canada’s gasbag bigger.

All it really did was to temporarily prevent a major price correction from happening in 2009. Now that the bubble is bigger we will see a bigger correction.

A bigger correction without the ability to slash rates from near normal to emergency levels to limit the depth of the price decline.

Canada’s price correction could be one for the record books.

#25 short seller on 06.25.15 at 6:57 pm

how can I short the real estate market?

#26 how much of a decline? on 06.25.15 at 6:58 pm

A few years ago, you said no crash, maybe at most a correction, upwards of e.g. 20%

What’s the new outlook? What’s your magic number?

AND, if real-estate does take a tumble, what’s the correlation with the stock market? (or, a balanced portfolio?)

#27 rainclouds on 06.25.15 at 6:59 pm

#10 NBURNABY

“What a joke… It’s a freakin depreciating asset like your car!”

You forgot to add: condos in Brentwood, Metrotown, Hastings St and any other location in Burnabystan. How is Comrade Corrigan and his lovely NDP Sidekick Kathy doing these days?

#28 CJBob on 06.25.15 at 7:06 pm

RV Sales eh. This looks like a good time to review the difference between correlation and causation.

https://en.wikipedia.org/wiki/Correlation_does_not_imply_causation

#29 Vundo on 06.25.15 at 7:09 pm

“Or prepare.” OK, so is there anything one can do to prepare? That is, aside from getting into a diverse and balanced portfolio (which we ought to be doing anyway if not already there).

I am already glad that I found this blog when I did, because it gave me a chance to reevaluate my choices and priorities before I got into a position where putting everything into RE was even an option. It gives me chills thinking about what I would have done if I had more money to spend before I learned what I know now. But aside from making rational decisions, is there anything else one can do to prepare?

#30 Rry Hacker on 06.25.15 at 7:09 pm

Garth,
Oliver could just do some hard core QE up here, kill the C$ and house prices will not suffer nominally. It happened in Moscow last year, where house prices collapsed by 50% but in US$ terms only.

#31 Godth on 06.25.15 at 7:10 pm

#14 John on 06.25.15 at 6:43 pm

Greece is in good shape, don’t worry about it the Troika know what they’re doing.
70% of Greek mortgages aren’t being paid
http://www.businessinsider.com/70-of-greek-mortgages-arent-being-paid-2015-6

That will never happen here though because we’re special. The Greeks are lazy (despite working longer hours than the average American, never mind the average German).

Isn’t the ideology of free market corruption grand? I love schadenfreude as a philosophy of life. I mean if someone isn’t suffering more than me how would I measure my superiority?

I can’t wait for the chickens to come home to roost in Canada and for this neoliberal ideology to take full effect. God I’ll feel good about myself. Blood in the streets, rust never sleeps.

#32 Henry Stollelmyer on 06.25.15 at 7:13 pm

How much longer can this artificially, pump up real estate market go on?

It seems to never pop and if rates do not move much up or down then why would this bubble pop?

Unless a similar situation like Alberta’s downturn in its oil, gas, pipeline industries spilled over the the rest of their economy, I can’t see it changing from what we have today.

This mother of all of Canadian real estate bubbles pumped up by a huge drop in 20 years from 10% mortgage rates to 2.5% mortgage rates is not going to going to eventually put alot of people in financial hardship with underwater house values, higher mortgage balance than the equity value of their homes.

#33 itshere on 06.25.15 at 7:13 pm

Had an interesting conversation with my mom the other day. Told me a about a lady at her job that wears the same dress to work every day. When asked by her colleagues if all is ok, she responded saying that it’s just what she has to do. She has to pay her mortgage. She has a second job right after work and does not have time to change so uses the washroom facilities at work to freshen up before heading to her second job.

Why would people give up their freedom, time with family, a decent attire and a shower all just to own a home. Am I missing something here??

#34 bigtown on 06.25.15 at 7:13 pm

For all you PanAm sports fans there are at least half of the tickets for the venues still available and the hotels that were thought to be sold out have some vacancy.

The latest real estate story in MSM purports to the fact that those brave Canucks who bought cheap condos in Arizona and Florida back in 08 are now cashing in and making out big translating back to loonies. Some are so encouraged they are rushing to buy a replacement second home in Muskoka or PEI…of course, you know they really missed the black fly season fer sure.

Canada’s MSM it doesn’t get better than this.

#35 Victoria Real Estate Update on 06.25.15 at 7:14 pm

When a Canadian banker or economist says there is no housing bubble in Canada or that there won’t be a deep price correction it is important to consider the source.

Canadian bankers have a vested interest in keeping house prices high in Canada. Their opinion is probably self serving.

American bankers and economists said there was no bubble in the US in 2005-06 when it was obvious that there was.

The more Canadian bankers deny the existence of Canada’s bubble the more it sounds like the US experience.

Wall Street knows what happens next with Canada’s bubble. They’ve already gone through this drill.

The wolves on Wall Street are an unbiased source and their actions are communicating loud and clear what they expect to happen with Canada’s housing market.

#36 Paul on 06.25.15 at 7:15 pm

re#17
Can’t wait
——————————————————————-
If ,no no when it happens it will not be good for anyone.

#37 HD on 06.25.15 at 7:19 pm

@ #9 rjrt81 on 06.25.15 at 6:32 pm

“you might remember that when you came to yvr and gave a talk my wife won a book and you commented that she had the nicest hand writting you have ever seen. thanks again Garth.”

———————-

Funny.

When Garth gave his talk in Vancouver, I also won a copy of Money Road. He didn’t compliment me about my hand writing though but poke a little fun of my name when it was picked up from the draw ;)

Best,

HD

#38 charts are wrong on 06.25.15 at 7:20 pm

The BMO chart is flat out wrong – it has to be normalized into CAD or USD and for interest rate differences.

The best chart is simply to look at avg monthly mortgage payments all in USD over time. Canada is touch higher, but globally not in the top 5.

#39 PM on 06.25.15 at 7:22 pm

12% RV sales drop? No surprise. The horniest for those toys are Alberta. Oil prices hit them hard, no more toys. Doesn’t have much to do with houses.

#40 And Yet... on 06.25.15 at 7:23 pm

An yet , price will be higher next year… and the year after.. .

#41 How? on 06.25.15 at 7:32 pm

How does one short a housing market? Any advice for us little guys?

#42 45north on 06.25.15 at 7:35 pm

What makes this recent period of relative calm between the two national markets so notable is that Canadian prices took about a 60% step ahead of U.S. prices in a six-year span from 2006-2012. Then, after a moderate step back, they have largely stayed there, far above their U.S. counterparts. It’s this gap that – to this day – has so many calling for a deep correction in Canada.”

Batman I see his right ear! ( right from Batman’s point of view )

The credit-fueled housing crash, on the other hand, usually whacks those who have put most of their net worth into a single asset, then leveraged the bejesus out of it. In short, it kneecaps the middle class

my neighbour is going to put an addition on his house. There is widespread belief that housing is a sure bet. Widespread. Boy oh boy there are going to be a lot of people angry and shocked when house prices drop.

Prepare? I have prepared as well as I can.

#43 H on 06.25.15 at 7:40 pm

Ok Garth. Is there a ETN or instrument that gives you 3x short of the Canadian housing.

What specific instrument is there available for risk capital to bet against the Canadian housing.

Or are the hedge funds running proprietary instruments not available to the general public.

#44 Godth on 06.25.15 at 7:47 pm

#36 Paul on 06.25.15 at 7:15 pm

Paul, it’s just part of making the world a better place for the children. Don’t be so negative!

#45 dood on 06.25.15 at 7:55 pm

Short real estate?? Bet against debt- buy physical gold and silver.

#46 Paul on 06.25.15 at 7:57 pm

I guess the P C police got to you for the original photo today?

This one is worse. — Garth

#47 Victor V on 06.25.15 at 8:05 pm

http://www.theglobeandmail.com/report-on-business/sobeys-to-cut-1300-jobs-as-it-streamlines-distribution-operations/article25122408/

Sobeys Inc. is preparing to shave 1,300 jobs in the wake of its takeover of Safeway Canada as the country’s second-largest grocer looks to consolidate its distribution and office operations and cut costs…

In its upcoming moves, it will close its Milton, Ont., distribution centre after its expanded automated centre in Vaughan, Ont., launches in October of 2016, spokesman Andrew Walker said.

And its Calgary 42nd Avenue centre will close after its recently acquired former Target distribution centre opens in mid-2017, he said. It expects its King Edward centre in Winnipeg to close early in 2016.

#48 Paul on 06.25.15 at 8:08 pm

#44 Godth

Not negative but I have witnessed this before. The kids suffer the most, I’ve gone into home repo’s 90 days after Christmas tree and lights still up the calendar page on December toys and some possessions scattered about.
SAD

#49 Musty Basement Dweller on 06.25.15 at 8:10 pm

I love the attached “news” story. Written by the real estate agents and published by the Vancouver Sun verbatim suggesting some factual component. But there is zero factual or statistical information in the story to back up the opinion.

http://www.vancouversun.com/business/Realtors+influx+buyers+Canada+recreational+property+markets/11165746/story.html

#50 Cici on 06.25.15 at 8:11 pm

Hah, hah…Financial Post today trying to spin a different story, the tune of which goes something like this:

* Houses are cheap in Canada, so buy, buy, buy!!!!!
* Housing always goes up in London, Australia and Canada, and you get five to one leverage, so buy, buy, buy!!!
* Tougher lending rules have driven consumers to subprime lenders, so buy shares in subprime lenders, cause they’ve gone up by 12.5% this years, and will continue to go up, up, up!

No joke, this is for real. Check out the link (and don’t forget to buy into their mutual fund, LOL):

http://business.financialpost.com/investing/buy-sell/dont-buy-into-the-fear-surrounding-the-canadian-housing-market

#51 jj on 06.25.15 at 8:12 pm

lot of back money coming in to canada?

#52 april on 06.25.15 at 8:16 pm

#1 – are you an idiot…or a realtor or both……..

#53 Bottoms_Up on 06.25.15 at 8:16 pm

The bankers almost took down the USA. In Canada, it will be the real estate cartels with their hoarded data, that have set us up to fail. It’s a wonder this economic activity of buying and selling real estate doesn’t have more oversight and freedom of information.

#54 Llewelyn on 06.25.15 at 8:17 pm

I have to chuckle each time I read how the housing market in Canada avoided many of the problems that occurred in the United States. That may be the case but it certainly wasn’t for a lack of trying.

It is important to note that the interest rate on most mortgages in the United States are fixed for 30 years while interest rates for most mortgages in Canada a based on a variable rate or reset at regular intervals. If mortgage interest rates increase as projected in 2015 or 2016 hundreds of thousands of homeowners in Canada will be affected immediately. In Canada the problem will not be a rapid increase in foreclosures but a redirection of billions of dollars to financial institutions.

The impact of devoting as much as 50% of household income to secure accommodation deserves more attention, particularly because unlike the United States mortgage interest cannot be deducted from taxable income. Paying higher mortgage payments and higher personal income taxes while the value of your most valuable asset declines will not be pretty. For those who become unemployed due to a contracting economy the pain will be much worse.

The housing sector of our economy generates 18% of Canadian GDP. This is a much higher ratio than any country in the developed world. Canada is definitely different because any decline in the housing sector of our economy will affect all Canadians, even those who currently rent.

As a result of our dependency on the housing sector the Government of Canada has a very long history of tinkering with the demand side of the housing market to protect our GDP from declining. Some of the tinkering included;

• O% down payments
• 40 year amortization periods
• Government insurance of high ratio mortgages to a maximum of $600 billion
• Creation of the Canada Housing Trust and Canada Mortgage Bonds (CMB)
• Government insurance for MBS and CMB
• Introducing the Insured Mortgage Purchase Program
• Increasing the allowable percentage of income devoted to housing costs from 35% to 45%,
• Etc.

Notwithstanding that many past mistakes by the Government of Canada were quickly corrected the spectre of even a slight correction in the current housing market could result in more tinkering with an already fragile house of cards.

Hopefully the information being shared on this blog will assist in development of initiatives that improve the future quality of life of all Canadians.

#55 the Jaguar on 06.25.15 at 8:17 pm

#39 PM
I would agree with you. Those big expensive toys, the RV’s, the boats, and the $85,000 trucks that pull those boats are standard issue for oil patch types are on a very short leash of desire these days. The reference to “The Perfect Storm” is one we hear a lot, but when you consider the impact of the big drop in oil, a housing market out of control to even the most skeptical eye, and the story nobody is paying enough attention to – the collapse of retail, it really does seem like a perfect storm. We are all living in a real life version of Blade Runner. I popped into a Black’s Camera store briefly on the weekend, attracted by a sale sign on photo frames and had a brief chat with the manager, trying to convince him that when a door closes a window often opens. He was grateful for the sentiment, but he looked at me and said..”The Internet is a wonderful thing until you begin to examine it’s effect on the job market”. So true. Welcome to the digital age. I wonder what impact the digital world will have on the housing market and people’s lives if the Perfect Storm really is coming our way. Some think the manufacturing base of north America was hollowed out when jobs were shipped overseas to cut costs, and those workers had to try to re-invent themselves. I would guess a lot ended up working in retail. And now Retail is going bust. Seems like there will be a great societal divide coming our way.
Just musings from the Jaguar fringe…

#56 Mister Obvious on 06.25.15 at 8:20 pm

#148 Robert (yesterday)

I’ve yet to find a great on-line calculator that shows the break even point when deciding to take CPP early or not.
—————————

I don’t think you need an on-line calculator.

Take two people who both turn 60 on the same day and are eligible for the same benefit. One elects to take CPP immediately the other elects to wait until 65.

(Note: the penalty for taking CPP early is sliding upward. It will be 0.6% per month by 2016 up from the 0.5% it was before 2012. To avoid unnecessary complication, let’s use the 0.6% figure. Thus, the person who takes CPP at 60 gets only 0.64% of the benefit he would have received at 65.)

Let X = the size of the monthly benefit
Let N = the number of months to collect
Let T = the total benefit either one receives.

For the first guy the benefit he will receive is:

T = 0.64 X N

For the second guy it’s this:

T = (N – 60) X

At some number of months in the future those two values of T will be equal. That can be written as…

0.64 X N = (N – 60) X

X cancels out on both sides…

0.64 N = N – 60

Then solving for N…

N =166.67 months = approx 13.9 years

They will both be just about 74 before they have accrued an equal benefit. Of course, the first person will have received roughly two thirds of the potential benefit for much longer. Like Garth says, take it ASAP. I did and I haven’t regretted it for a moment.

#57 Spectacle on 06.25.15 at 8:30 pm

Regarding :
#31 Godth on 06.25.15 at 7:10 pm
#14 John on 06.25.15 at 6:43 pm

” I mean if someone isn’t suffering more than me how would I measure my superiority?”

“I can’t wait for the chickens to come home to roost in Canada and for this neoliberal ideology to take full effect. God I’ll feel good about myself. Blood in the streets, rust never sleeps.”
———————————–
I like the the humility and originality of your commentary tonight, as well as the creative analysis of the situation compare to the norm on here of late.

” Rust never sleeps” : Rather than assume that life will go on as before, yawn, I’ve made the hard investment to take advantage of the growing business opportunities of exactly that gaping hole created by that “Rust” corroding the base of North American ( some would say worldwide…) business/culture.

I don’t see the logic of waiting to vulch real estate, or short anything ( greater fools game if your unseasoned) That’s what excess profits may be for. I sleep very well now, as “rust” doing its work on the economy and real estate is my salesman. Hope that makes sense.

Ps: I’ve got a newborn son coming in 3 weeks! Wonder if there is a credible investment to make for his future wealth?

Regards ,

#58 espressobob on 06.25.15 at 8:35 pm

#22 Money Driven

Pull up a long term chart on HFD, nasty. Inverse ETFs are very short term holds for ‘traders’ like Rick Berman or others into market timing. Usually wrong.

Another problem besides betting in the wrong direction, is that you can also loose money if the sector moves sideways for a period of time, and you still have that position.

Do yourself a big favor and avoid these products, go global and diversify. Way better!

http://www.horizonsetfs.com/pub/en/etfs/?etf=HFD&tab=overview

#59 Victoria Real Estate Preacher on 06.25.15 at 8:35 pm

When Victoria Real Estate Update says there is a housing bubble in Victoria and there will be a deep price correction it is important to consider the source. For the last 10 years there have been doomers claiming they are going to “vulch” a house for pennies on the dollar in a housing crash. That day will never come, regardless of how sincerely the doomers wish for it. An actual crash would hammer the entire economy (including the doomers). There won’t be any winners there.

#60 Canadian Abroad on 06.25.15 at 8:35 pm

“RV/Boat/Motorcycles sales are highly discretionary as you know. I’ve been following these stats for years – this is very reminiscent of trends in US recreational vehicle market 6-12 months prior to 2007-08 implosion.”

On the other side of the coin..

I run the largest motorcycle media website in North America for the past 16 years and track the data for visitors and interest in motorcycles on a monthly basis. So far, I can easily say that the last 3 months stats are extremely strong, over 4 million unique visitors per month. Usually I can see a forward leading indicator of economic trouble based on previous month stats and there isn’t one, yet.

Also I track monthly industry ad sales volumes at my site and again, it’s been strong.

This tells me there is still very strong interest in motorcycles and riding right now…

I cannot comment on boat or RV though.

#61 Red Deer Rob on 06.25.15 at 8:35 pm

The job market is really tight in Central Ab. A lot of people are walking on eggshells when they go to work. I wouldn’t expect the sales of trailers, boats or other recreational vehicles to be doing well.

In Mid-March I was laid off, since then I’ve sent out approximately 35 – 45 applications to do anything from labour to truck driving to entry level office work. I have my class 1, oilfield tickets, a Bcomm degree, I’m athletic and able bodied, drug free, punctual and have a good work ethic. I have not heard one reply yet.

I’m debt free and on EI so ill be okay but I know there are others really struggling now. I don’t want to be here when the real estate market deflates!

#62 DJG on 06.25.15 at 8:41 pm

I’m curious as to how the Canadian housing market is actually being shorted. The people who made out like bandits in the US were buying credit default swaps on AAA asset-backed products that were in fact full of junk mortgages with massive borrower default rates. As far as I’m aware, that market doesn’t exist here, or in the US any more. What could you do here other than bet against the dollar? Short someone like Firm Capital?

#63 seeing it from both sides on 06.25.15 at 8:47 pm

The shorts have been hurting since 2013. They must be hoping renewed press coverage might save them.

“…markets in Vancouver and Toronto have continued to rocket higher since international short-sellers started circling in 2013.”
http://news.nationalpost.com/news/canada/u-s-short-sellers-betting-on-canadian-housing-crash-an-accident-waiting-to-happen

http://www.theglobeandmail.com/globe-investor/meet-the-man-whos-selling-canada-short/article11585150/

#64 jane 24 on 06.25.15 at 8:48 pm

The best way to short the Cdn housing market is to sell your house if you are over-housed. If you can trade down and still meet your needs do so now. If you don’t then Garth did warn you.

Simples!! ( British TC commercial catchphrase with meercats).

#65 Retired Boomer - WI on 06.25.15 at 8:49 pm

Nobody knows they are “over the hill” or, “Past their prime” until it is too late.

For me watching a truly epic melt down, complete with Weeping, gnashing of teeth, and panic seems like the order of the times. Besides, there are plenty of repo men with time on their hands.

A goose in rates, coupled with a non-recurring oil price spike, and crappy manufacturing outlook just might bring order to the chaos of home prices. Too bad, but maybe the froth is off the hosers.

We shall see. First, I need the EU to tell Greece to ‘get thee bent.’ Doubt it will happen, as extend and pretend seems the order of the times.

Why are people means such hard arses these days?

We await a market break…

#66 Canada is a credit and housing ponzi on 06.25.15 at 8:52 pm

Victoria Real Estate Update on 06.25.15 at 7:14 pm
When a Canadian banker or economist says there is no housing bubble in Canada or that there won’t be a deep price correction it is important to consider the source.

Canadian bankers have a vested interest in keeping house prices high in Canada. Their opinion is probably self serving.

American bankers and economists said there was no bubble in the US in 2005-06 when it was obvious that there was.

The more Canadian bankers deny the existence of Canada’s bubble the more it sounds like the US experience.

Wall Street knows what happens next with Canada’s bubble. They’ve already gone through this drill.

The wolves on Wall Street are an unbiased source and their actions are communicating loud and clear what they expect to happen with Canada’s housing market.
____________________________________

These Hedge funds run the show (world)and when they bet they win and cash in. Canada RE is going to crash especially the bubble cities Vancouver and Toronto which will fall like the twin towers.

#67 Randy Randerson on 06.25.15 at 8:52 pm

#38 charts are wrong on 06.25.15 at 7:20 pm

Do you get paid in USD? Does the majority of Canadians get paid in USD? Do you pay USD in your local Wal-mart?

If you answered NO to all three, then you’re wrong.

#68 Smoking Man on 06.25.15 at 8:56 pm

We have had a lot of msm reports about Canada’s Hot Housing, and bubble talk…

This tells me the machine is trying to talk the market down.

So I go to the treb website and read the mid market June Sales. Wow..unreal. Record beaker.

Our media has descended down to the level of a wip , to move and control the herd.

If real estate was ever in trouble, MSM would be blowing sunshine on all networks.

I’ve seen this happen since 2008.

As far as shorting real estate , ask Garths buddies who came up here a few years ago to do just that. If they are still solvent.. It’s in the archives.

#69 pm on 06.25.15 at 9:00 pm

For those that want to know how to short the Can. RE market…it’s right under your nose…check ‘Money Road.’

#70 ANON on 06.25.15 at 9:02 pm

Arguably, a diesel pusher may hold its value a bit more than a house.

#71 bdy sktrn on 06.25.15 at 9:09 pm

Ok Garth. Is there a ETN or instrument that gives you 3x short of the Canadian housing.
———————–
good thing there isn’t or many here would have been killed over the last couple years

#72 Andrew Woburn on 06.25.15 at 9:11 pm

#18 NH on 06.25.15 at 6:49 pm
Is there any way an average person can short the Canadian housing market ?
=================

What about Genworth Financial? Granted its already half of its value a year ago.

#73 S.Bby on 06.25.15 at 9:14 pm

#27 rainclouds:
If you are a lucky socialist you can get a union job at City of Burnaby and laugh all the way to the bank. Ratepayers, who are they?

http://www.burnabynow.com/news/city-staff-cost-142-million-in-2014-1.1973328

And then the Burnaby city council screws over the poor by rezoning low cost lowrise apartments for upscale condo towers:

http://www.burnabynow.com/news/silver-avenue-development-on-tomorrow-s-public-hearing-agenda-1.1976213

to collect more taxes and DCC’s to support their union buddies.

#74 Andrew Woburn on 06.25.15 at 9:15 pm

“Digital-only challenger bank Atom wins licence (in UK)”

“Atom Bank has received its full licence from the Bank of England, moving the digital-only lender one step closer to opening to customers.

The Durham-based lender plans to offer a full range of consumer and business accounts, loans and savings products, and expects to start serving customers this year.

It will launch through a mobile application, with a desktop computer service to follow at a later date.”

http://www.telegraph.co.uk/finance/11696350/Digital-only-challenger-bank-Atom-wins-licence.html

#75 johnk on 06.25.15 at 9:16 pm

The whole RV “lifestyle” was built on cheap gasoline, $1/gallon or less. Nowadays you might as well buy shares in a buggy-whip company. Good luck trying to flog one of these fuglies.

#76 JO on 06.25.15 at 9:25 pm

did 3 credit apps today. all 3 are duds.
Have noticed in the last couple of months many average folks applying to borrow against inflated houses to Reno or buy more RE or pay of spiralling debts
While there are many Canadians in good financial condition, the majority of the recent buyers are insolvent and don’t know it yet
As I do not get paid on commission not sales points like many other FIs, I do tell these people to not do it and to use record low rates to pay down debt
Sadly many are ignorant and just ignore
But at least 2 out of 3 souls were saved today as their apps did not meet guidelines
I am afraid many Canadians deserve what’s coming. Each one freely applied for a loan on their own
We have a crushing, record debt at record low rates
The odds are very high that rates rise despite a weakening economy at some point within the next few year and the resulting drop in RE and decaying economy serve to wild out most of these financial illiterates
As if you are going to get rich buying residential RE at record prices and record low rates

#77 Nemesis on 06.25.15 at 9:32 pm

“So, basically, ignore the previous 821 words. Or prepare.” – HonGT

#It’sAParable…

https://youtu.be/ttcROXOTbtg

#78 SWL1976 on 06.25.15 at 9:33 pm

The next pop is the big pop and it will know no borders. Sadly it’s all by design and easy to see for those who care to look.

Many will be surprised, and it won’t be pleasently. Way to tell it like it is Godth.

Sometimes the truth hurts

As always Garth, thanks for the good read and moderating the comments section where all us eccentrics come for our daily dose of everything and nothing

#79 Another Jim on 06.25.15 at 9:37 pm

It’s certainly looking rather epic, or perhaps even biblical Downunder too. I don’t live there any more, but it’s interesting to watch from afar (as is Canada, where I don’t live either – yes, I need to get a life and spend less time on pathetic blogs)

While you have a read of this don’t forget to order your Telephunken U-47 Spruikbot. Threy’re not making any more of them you know.

http://www.macrobusiness.com.au/2015/06/reiwa-perth-housing-to-boom/

#80 cramar on 06.25.15 at 9:39 pm

Well as far as RV sales are concerned, maybe true for SOBs as we call ’em. That means “Some Other Brand” to an Airstream owner. When I checked several weeks ago with the big Airstream dealer in London, ON, I asked if the drop in the Loonie has effected sales. Nope! Some of the high-end models (well over $100k) they cannot get enough to supply the demand. Especially the top-of-the-line Interstate Touring Coaches (built on a Mercedes chassis). The price has gone to $180,000-$200,000 (up considerably over last year), and demand far outstrips supply. Their inventory on the larger Airstreams is next to nil.

#81 Nemesis on 06.25.15 at 9:39 pm

#BonusYellowBrickRoad… #Albert&Julie… #DoItWinnebagoStyle…

https://youtu.be/1ULWqxJOD-w

#82 sweating it on 06.25.15 at 9:47 pm

This is all poor people’s problem.

Balanced portfolio with 7% average return is poor people’s herd idea about investing.

Carl Icahn liquidated his 3-year long Netflix position.

He got out making 1000% ROI. In 3 years.

Lucky for him, he did not play with peanuts.
He made 2 billion dollars.
Good for him.

I don’t think he is wasting away his life agonizing over renting or buying.

#83 Andrew Woburn on 06.25.15 at 9:48 pm

“‘Colossal’ fall in demand for luxury homes in parts of London, data reveals”

Nah. Can’t be. House prices only go up. Foreign investors will just keep coming. Forever.

http://www.telegraph.co.uk/finance/property/11697582/Colossal-fall-in-demand-for-luxury-homes-in-parts-of-London-data-reveals.html

#84 Raider on 06.25.15 at 9:52 pm

On the “how”…
http://www.slideshare.net/mobile/ndsouza22/the-big-short-ii

#85 Gersten R on 06.25.15 at 9:55 pm

Garth,
Reading this blog has created a Pavlovian-style reflex in me…

Whenever I see posts by Smoking Man, Mark, American, Victoria RE Update, I automatically “scroll”…..

#86 Grantmi on 06.25.15 at 10:07 pm

#15 Mocha on 06.25.15 at 6:43 pm

Prepare? Open a liquor store?

Archaic… open a Pot Shop in Dopecouver! The streets are paved with Green!!

#87 sweating it on 06.25.15 at 10:07 pm

#85 Gersten R

Reading this blog has created a Pavlovian-style reflex in me…

Whenever I see posts by Smoking Man, Mark, American, Victoria RE Update, I automatically “scroll”…..

=======

I scroll FOR the Smoking Man and skip the herd.

#88 Stickler Hen on 06.25.15 at 10:17 pm

Garth,

Sorry, I am a bit of a stickler for detail. Where does the cut-off for the ignore the previous 821 words begin. A word count on MS word, shows 821 words if you count until the end of
“So, basically, ignore the previous 821 words.”

This would mean that I should also ignore the sentence which says,

“So, basically, ignore the previous 821 words.”

Therefore, logically speaking, I read this as…

“So, basically, pay attention to the previous 821 words including this sentence.”

starting to get really confused by your word artistry here….

#89 Washed Up Lawyer on 06.25.15 at 10:20 pm

#61 Red Deer Bob

As a Calgarian working in Fort McMurray and owning a shack in Cowtown, I am pulling for you. Hope you land something real soon.

My concerns about a punishing Calgary real estate market are overshadowed by the upcoming financial maelstrom caused by my having a 19 year old daughter. When she, Felicity, weds her betrothed, Todd, I will spring for bus fare to City Hall and some Baby Duck.

http://www.theglobeandmail.com/globe-investor/personal-finance/household-finances/bridesmaids-increasingly-feeling-the-financial-pinch-of-weddings/article25088937/

#90 not 1st on 06.25.15 at 10:22 pm

Title for Garth`s next book – “F`n Told Ya So”

#91 Smoking Man on 06.25.15 at 10:28 pm

#90 not 1st on 06.25.15 at 10:22 pm
Title for Garth`s next book – “F`n Told Ya So”
…..

I agree , but that’s a long way off.

#92 not 1st on 06.25.15 at 10:34 pm

Shorting the loon is the better trade because there is pain coming in a number of sectors. Oil will tumble again, Ag is on tap for a drought, warm winter will cut natural gas demand and slowing china (and eventually US) will curb our exports greatly.

#93 AlbertaGuy on 06.25.15 at 10:40 pm

Smokey…let me know when you are ready to start looking in Yuma….but not between May and Oct…just too damn hot!

#94 Ronaldo on 06.25.15 at 10:48 pm

#18 NH on 06.25.15 at 6:49 pm

”Is there any way an average person can short the Canadian housing market ?

Yes. Stay the heck out of it and you’ll end up a winner.

#95 Freedom First on 06.25.15 at 10:48 pm

Yes. In life, there will always be speed bumps for every human being. No exception.

No. You are not different.

Some people live every day handling everything with a healthy and calm attitude. They have learned how to live life.

Unfortunately, the majority of people are not good at living life. They are often referred to as “pigeons”, or, “sitting ducks”, or, “marks”. However, people who fit those descriptions mostly refer to themselves as “victims”.

#96 whitehorn on 06.25.15 at 10:57 pm

#54 Llewlyn
“As a result of our dependency on the housing sector the Government of Canada has a very long history of tinkering with the demand side of the housing market to protect our GDP from declining. Some of the tinkering included;

• O% down payments
• 40 year amortization periods
• Government insurance of high ratio mortgages to a maximum of $600 billion
• Creation of the Canada Housing Trust and Canada Mortgage Bonds (CMB)
• Government insurance for MBS and CMB
• Introducing the Insured Mortgage Purchase Program
• Increasing the allowable percentage of income devoted to housing costs from 35% to 45%,
• Etc.”

I agree totally with your comments. The most bothersome is the Canadian Govt. has continually struggled to turn this economy around since 08/09 with no noticeable success. The sad reality is if they left the tinkering alone back in 2005/06ish, people would have more disposable income instead of feeding their mortgages. That would be the biggest boost to the economy, creating more jobs, and spending power. This is one area I wish the Canadian Gov’t should of left alone, Canada may dearly face the consequences in the next few years. It affects us all in the country.

#97 fleabitten monkey on 06.25.15 at 11:04 pm

So this guy Ian Lee, Sprott school of biz etc, former mtg manager, he says. Gets up there on the lang exchg. Vancouver is a major city now, like New York, London, Hong Kong, he says. Sellers in Van and TO are not selling to locals but to international folks, unlike people who are selling in Ottawa who are selling to locals, he says. Prices will just flatline over 4 or 5 yrs, he says. Always been that way, he says. Who is this douchebag? So much confidence to speak this way.

#98 Retired Boomer - WI on 06.25.15 at 11:10 pm

#79 ANOTHER JIM

Telefunken U-47 …… with leather????

#99 Nagraj on 06.25.15 at 11:15 pm

“The Unimaginable”

Great title.
Those of us who are not stuck paying for an overpriced house and living paycheck to paycheck might give some thought to the consequences of of the “immediate and debilitating” effects of loss of home equity (“while the debt remains”). Like the psychological and political consequences.
These overleveraged people will be, for one thing, very suddenly angry.

We already have a lot of very angry people: those young adults who have had to postpone family formation are angry, as are their parents, and all their friends. Nothing properly compensates for lost time.

And then there’s the matter of debilitatingly low wages, job insecurity (and provincial spending cutbacks).

“The Unimaginable” reads like a subversive pamphlet in a time of war; whereas MSM proclaims “We’re on the way to victory”, GT counters “We’ve lost!”

GT is of course quite correct, as are the foreign observers. (The language of domestic critics of the “war effort” remains politely and acceptably circumscribed.)

Snowflakes today, hailstorm tomorrow.

#100 saskatoon on 06.25.15 at 11:23 pm

garth,

you must be wrong:

cibc says that the condo glut has actually helped to stabilize the housing market…

http://www.thestar.com/business/2015/06/25/condo-boom-has-helped-stabilize-housing-market-cibc.html

#101 kommykim on 06.25.15 at 11:35 pm

RE: #41 How? on 06.25.15 at 7:32 pm
How does one short a housing market? Any advice for us little guys?

Yes. Little guys shouldn’t be short selling anything. Leave that to the big boys.

#102 Salutations Sally on 06.25.15 at 11:50 pm

Gee, I went to Garth’s talk in Vancouver and didn’t win a book.

#103 MF on 06.26.15 at 12:00 am

#132 Bottoms_Up on 06.25.15 at 12:11 pm

I don’t get your message. I am not questioning you as a homeowner lol. I couldn’t care less if you owned Casa Loma. My boomer parents who were born in the 40’s and who gave me everything are homeowners. I come to this pathetic blog for the same reasons you do.

I responded to your condescending tone the first time “please explain how home ownership is a money pit” and now I will respond to it again: “fresh out of diapers?”

In 2008 I was 25, done University, and working full time. Nearly bought a GTA condo a few years later when I had saved enough for a down payment but came across this blog around the same time. Best thing I ever did.

Your posts are usually decent, but what’s with the condescending attitude? You give the boomers a bad name (pun intended).

As for today’s post.

I have only been in the skin for a few months with my portfolio so I would welcome a correction in stocks. Why? I guess it is better to get it over with. Did I buy at the top? Perhaps, but two things seem certain from what I have read:

1) You can never know when the peak is. You just have to jump in when you can, which is what I did.

2) After a correction, for those that hold on and don’t sell, the market ends up chugging along to an even higher peak eventually, but it may take years. I am hoping to be in this for the long haul anyways.

3) wouldn’t DRIP programs work to your advantage during a falling market?

Thanks as always Garth,

MF

#104 MiaMerra on 06.26.15 at 12:00 am

#61 Red Deer Rob on 06.25.15 at 8:35 pm

The job market is really tight in Central Ab. A lot of people are walking on eggshells when they go to work. I wouldn’t expect the sales of trailers, boats or other recreational vehicles to be doing well.

In Mid-March I was laid off, since then I’ve sent out approximately 35 – 45 applications to do anything from labour to truck driving to entry level office work. I have my class 1, oilfield tickets, a Bcomm degree, I’m athletic and able bodied, drug free, punctual and have a good work ethic. I have not heard one reply yet.
——————————
Maybe apply at a debt counseling office.

#105 Godth on 06.26.15 at 12:00 am

#82 sweating it on 06.25.15 at 9:47 pm

So you’re like that white ding-bat that identifies as black.

You’re a peon that identifies with the king.

God help us all.

#106 45north on 06.26.15 at 12:07 am

Paul: I’ve gone into home repo

pretty funny

Llewelyn: It is important to note that the interest rate on most mortgages in the United States are fixed for 30 years while interest rates for most mortgages in Canada are based on a variable rate or reset at regular intervals. If mortgage interest rates increase as projected in 2015 or 2016 hundreds of thousands of homeowners in Canada will be affected immediately. In Canada the problem will not be a rapid increase in foreclosures but a redirection of billions of dollars to financial institutions.

noted. The 30-year fixed mortgage is a huge factor in the stability of the American housing market. I don’t even want to think about what Canada is going to look like once rates rise.

Jaguar: Seems like there will be a great societal divide coming our way.

i’m starting to sense that.

JO: I am afraid many Canadians deserve what’s coming. Each one freely applied for a loan on their own
We have a crushing, record debt at record low rates
The odds are very high that rates rise despite a weakening economy at some point within the next few year and the resulting drop in RE and decaying economy serve to weed out most of these financial illiterates

you meant weed out?

#107 Carpe Diem on 06.26.15 at 12:12 am

I am sorry!

I think I’m a loser.

I’m on vacation. I’m visiting my dad with my 3 kids.

Quebec, North-Coast … no idea where people can work !!

I see all my cousins living on the St-Laurent in awesome homes, having new 4×4 pickups and 4-wheelers that are stunning!

Being teachers or nurses ends up being superior to a IT/business consultant dude.

Socialism may be the way!!!

Time for a bit of risk to catch up.

Time for a change…

#108 rawdiswar on 06.26.15 at 12:17 am

#82 sweating it

Heck of a point right there.

Toronto is nowhere near London on a global scale. Give it a hundred years or so and maybe, but that just isn’t an honest comparison. Even compared to many American cities, Canadian cities pale by comparison, they are just too new. Plus the USA has a real economy, so if we think our real estate is worth more than our Yankee neighbours, we are getting way too cocky.

#109 YumaGuy on 06.26.15 at 12:35 am

#93 AlbertaGuy on 06.25.15 at 10:40 pm
Smokey… I work in Yuma testing desert heat loads on vehicles… It’s only June and its been 45C for two weeks straight.

#110 Shortseller on 06.26.15 at 12:40 am

#25 short seller on 06.25.15 at 6:57 pm
how can I short the real estate market?-
—-
rent

#111 The original dave on 06.26.15 at 12:42 am

Everyone keeps asking “how do you short the cdn real estate market?”

It’s easy…..

Rent. That’s it. Don’t do anything stupid

#112 Strathcona on 06.26.15 at 12:45 am

News from the street here in Grande Prairie, AB. Things are not looking well with housing here. A year ago, homes were selling as quickly as they were listed. Now, they languish on the market, a few reduced, very few sold, several open houses with very little interest.

Prices are still high though, with many sellers still lost somewhere in last year. I know of one local oilfield services company here that fired 23 employees. Not laid off with severance and benefits, fired. The company went bankrupt at the same time. So much for those 23. I hope noone was living pay to pay, lawyers don’t work for that to get your settlement.

Tough times ahead. A fundamentalist government, heavy on the new taxes and regulation. Where’s our public transit? Where’s our passenger rail link from Edmonton to Calgary?? Would that save some carbon and create jobs?

These are a special bunch of champagne socialists we have here now.

#113 Squirrel meat on 06.26.15 at 12:58 am

“The American” wasn’t making it up! Bloody hell.

http://news.nationalpost.com/news/canada/newfoundland-man-drives-18km-in-wrecked-car-cannot-remember-hitting-moose-hey-buddy-you-got-no-roof-on-your-car

#114 devore on 06.26.15 at 1:03 am

#4 zedgt87

I know Garth disagrees with me on this.

Did you even read the post today? Or do you just rush to copy/paste whatever handy doomerish quote seems to fit the subject?

The impact is immediate and debilitating as equity vanishes, yet the debt remains. In short, they kneecap the middle class – those very people who spend the most, and support our consumer-based economy.

#115 Nemesis on 06.26.15 at 1:16 am

#Unimaginably… #InMemoriam… #’JohnSteed’…

[Gaurdian] – The Avengers star Patrick Macnee dies aged 93

“What sort of fiend are we dealing with?” said the quintessentially English Steed in one episode. “A man who would bite the end off a cigar is capable of anything!”

Macnee nearly lost the role of bowler-hatted Steed because of his aversion to violence. In a 1997 interview he recalled being told by producers that he would have to use a gun on the show.

“I said, ‘No, I don’t. I’ve been in World War II for five years and I’ve seen most of my friends blown to bits and I’m not going to carry a gun.’ They said: ‘What are you going to carry?’ I thought frantically and said: ‘An umbrella.’….

…When asked which of his original co-stars – Blackman as Cathy Gale, Rigg as Emma Peel, or Thorson as Tara King – were most appealing, Macnee replied: “The very first thing you learn if you’re a gentleman is that you never compare one woman to another. That’s the way of all death. You get a big pointed high heel in your groin and you’ll never walk again!”…

http://www.theguardian.com/tv-and-radio/2015/jun/25/avengers-star-patrick-macnee-dies

#BonusSteedFromPeterPeel…

https://youtu.be/XLZYoBm1yAw

#116 Bob Dod on 06.26.15 at 1:16 am

I have recently been noticing a lot of closed storefronts in downtown Vancouver recently. Reminds me of Hamilton in the 1980s. Restaurants, book stores, everything is going out of business as new commercial properties are under construction. I think it may be time to pull out.

#117 TRT on 06.26.15 at 2:52 am

99% of the people here probably failed Calculus or never took it. It’s a course about the area under a graph.

If you don’t understand numbers, then you will be confused on why prices are so high in Vancouver and Torornto. Good luck to the bewildered.

#118 Future road boss on 06.26.15 at 6:12 am

Much to be made settling accounts now. Don’t you feel the edge this sweltering June doldrum? My peeps are antsy. Barter has been brisk. I just picked up a prime 3 acres for a song, cash, right across pavement from the province park. Level and true. Zoned small bznz, recreation, campground. Sticking in 400 v underground, camp kitchen, showers. My banker’s jaw dropped. Thinks I’m nuts. Wants me to invest like you. A song, I told her… My bros are all trades. We’ll build for 30$/sqqft plus bar tab. I do log and stone. Is this not good timing?

$25+ a night. Twenty five private camp sites to choose from. Big old texas driveway for turning flatbed around. Smile, you’re on web cam. Paintball, horseshoes, mtn bike, zip line, all the views! Just got foreclosed? Bring that RV down here and enjoy our relaxed community atmosphere. Cheap weekly rates. I rent out metal detectors and seed the lot with loonies for your kids. They won’t scream all the time and wonder why life turns shat. Gives them simple joy. And check out our lotto, candy, smokes and beer govt approved theme store. Sell your books in our shipping can boutique. No campfires after 11 pm and your own accoutrements, please.

See you can be a successful and in control land baron like me, Garth, and have success in what you do. My daddy always said if the shorts feel strange, they’re probably not yours.

#119 Nagraj on 06.26.15 at 6:36 am

some fun headlines in the FP (Failing Propaganda) this morning:

“Don’t buy into the fear surrounding the Canadian housing market”

“There’s a 35% chance Canada will cut interest rates again soon: RBC . . . ”

“Stop comparing Canada to the U.S. housing crash: ‘It’s not just wrong, it’s irresponsible’ ”

“Our overvalued loonie is doing as much damage to the economy as a huge interest rate hike”

“Muskoka becoming Hamptons of the North as cottage prices top $25 million”

reminds me of a horrible movie where a witch cursed somebody and every time that somebody opened their mouth to speak they’d vomit a mess of chickenshit instead

#120 lee on 06.26.15 at 8:04 am

Jonathan Ratner of the Financial Post says no need to worry about Canadian housing market. Done. No need to worry.

#121 hi schol droop out Realtor on 06.26.15 at 8:57 am

117 TRT on 06.26.15 at 2:52 am
99% of the people here probably failed Calculus or never took it. It’s a course about the area under a graph.
____________________________________

Calculus? Most realtors don’t even have Hi schol. Hour professon is a yoke.

#122 Llewelyn on 06.26.15 at 9:05 am

#100 Saskatoon Thanks for that link.

I would draw your attention to the closing paragraph offered by the CIBC spin doctors.

“More than a crash, or significant defaulting on mortgages as happened in the U.S., CIBC anticipates that any downturn in the housing market would “act as a major drag on overall economic activity” by dampening consumer confidence and boosting unemployment in construction and real-estate related businesses.”

There is that word confidence again. Sure hope all the currency traders and short sellers around the world never figure out that lost confidence might affect the economic health of a country where close to 1/5 of their GDP originates from the housing sector.

One other pithy observation also tweaked my curious nature.

“Not only has immigration accounted for about three-quarters of Canada’s population growth recently, the report says, but more than half those newcomers, a higher proportion than in the past, have been in the prime home-buying years of 25 to 45.”

Let me see, in 2015 Canada will invite 285,000 new citizens to share in our bounty and many of these new arrivals are being viewed by CIBC as a safety net protecting our housing market from a possible correction. How could the confidence of our new citizens ever be dampened?

Yikes!! What are they putting in the water cooler over there at CIBC?

A slight correction in the housing market might create a drag on the Canadian economy but our high level of immigration will assure a nice safe landing. Apparently our new citizens have no need of employment and will go directly to CIBC to apply for a mortgage to purchase one of those nice new condos in Toronto.

Give your head a shake boys! Canada would appreciate it if our major banks spent less time writing self serving puff pieces and a little more time thinking up ways to expand the Canadian economy. The there are other sectors of our economy to invest in other than housing by the way.

#123 jess on 06.26.15 at 9:23 am

lookback

Paulson, who served as President George W. Bush’s Treasury secretary from 2006 to 2009,

http://www.reuters.com/article/2014/10/06/us-aig-bailout-trial-paulson-idUSKCN0HV1OS20141006

Open Market Operations
http://www.federalreserve.gov/monetarypolicy/openmarket.htm
==========================
the final chapter?

http://www.bloomberg.com/news/articles/2015-06-15/hank-greenberg-s-starr-wins-trial-but-no-damages-in-aig-suit

http://www.sec.gov/litigation/admin/2010/34-62593.pdf

misstatements
exposure to sub-prime mortgages and related to disclosures that the Citigroup investment bank had reduced it’s sub-prime exposure from $24 billion at the end of 2006 to slightly less than $13 billion. In fact, however, in addition to the approximately $13
billion in disclosed sub-prime exposure, the investment bank’s sub-prime exposure included more
than $39 billion of “super senior” tranches of sub-
prime collateralized debt obligations and related
instruments called “liquidity puts” and thus exceeded $50 billion. Citigroup did not acknowledge
that the investment bank’s sub-prime exposure
exceeded $50 billion until November 4, 2007, when
the company announced that the investment bank then had approximately $55 billion of sub-prime
exposure.

http://www.sec.gov/Archives/edgar/data/831001/000110465907090233/filename1.htm

#124 james on 06.26.15 at 9:38 am

An institutional allocation mix in Canada would look something like this
Equities 50% broken down by 15-20% domestic and the balance of 30-35% Global, and of that 5-8 would be emerging markets, the balance would be devoted to developed markets.
30% would be in Fixed income, mostly corporate and with a short duration
the less liquid part 10% would be Private Equity, Infrastructure, and Real Estate
and 5-10 would be liquid alt strategies eg global macro and managed futures. the cash position would be min of 0 max 10%

Nope. — Garth

#125 H on 06.26.15 at 9:47 am

Ok, so the blog is set make it clear there is a housing collapse coming etc. Yet nobody has a clue how to short it.

Makes sense.

Where did I say “collapse”? — Garth

#126 Rational Optimist on 06.26.15 at 9:47 am

87 sweating it on 06.25.15 at 10:07 pm

“I scroll FOR the Smoking Man and skip the herd.”

Same here. I only saw post #85 today because, after the article, I type Ctrl F Smoking.

#127 Holy Crap Where Is The Tylenol on 06.26.15 at 10:01 am

So the stock market can plop, and life on Main Street carries on. But when the housing market chokes, everybody’s nailed. They may even stop buying Harleys and RVs. How sad is that?
___________________________________________
Not sad at all, I’m very much prepared to purchase a new Harley, RV and perhaps even a new sailboat. This is the opportunity for those of us who have been prudent investors to swoop in and get a deal. Hell I don’t mind saving a few thousand here and there. It all adds up. Perhaps I will give my grandchildren some end of school year gifts for good grades. They wouldn’t appreciate some stocks in Blue Chip Co’s via a custodial accounts but Ill throw in an iPhone. Its good to start them off with investments that they can watch an learn from.

#128 Holy Crap Where Is The Tylenol on 06.26.15 at 10:07 am

The American was correct with his choice of eating establishments in the big smoke as well. Being that I live in the nether regions of Oakville and don’t know all of the good eats in the city. He was dam right on with The Electric Mud BBQ. Thanks buddy, best ribs Ive had in some time and the BBQ cauliflower was great.

#129 maxx on 06.26.15 at 10:11 am

#35 Victoria Real Estate Update on 06.25.15 at 7:14 pm

My money’s on the wolves.
Real estate is stalling in many of Canada’s markets. Significant stock accumulation and much of it still not selling.

5 stages of seller grief:

DENIAL- “re always goes up”, “the press said so, it’s all over the media.” “Government will protect housing.” For a time, then they’ll warn the public and warn and warn again. Then, YOYO!

ANGER- “the price is the price and I’ll just sit in my rocking chair, smugly swinging my foot and wait for the market to come to me”
Meantime, opportunities slip through your fingers. Getting out a couple of years ago would have meant the proceeds, for example, could have been converted to US$, with enough sold back to get your original Canuck bucks and one heck of a nice fat US$ account left over. Voila! Travel money. Bucket list money. Too late now, the CAD is sliding….. and prices just quietly keep on melting………until rates start rising, at which time the melt will become rather noisy.

BARGAINING- “maybe I’ll just call the re guy/gal and get an opinion on price, then reduce it very slowly if I have to”

DEPRESSION- “that re agent must be wrong, I’ll get another opinion”, “it’s only a temporary blip”, “why is no one coming to visit?”, “can’t the government do something?”…….

ACCEPTANCE- “If I’d sold earlier, I could have bought US$, or a property in the US, started my bucket list, be sitting on the cash, renting to scoop smaller digs at lower cost later and investing the rest………..maybe I’ll just drop the price a bit more……….”I wonder what it will sell for?”

I wouldn’t touch most re with a barge pole for the foreseeable future. We’re in the hopper.

#130 The American on 06.26.15 at 10:22 am

At #113: Squirrel Meat, just curious… Did you really think I would make up something like that? I assure you what I post is backed by fact that is easily searchable. If it is opinion, I will say so. In this case, I feel sorry for that man who drive his car into a moose.

#131 Leo Trollstoy on 06.26.15 at 10:29 am

I know of one local oilfield services company here that fired 23 employees. Not laid off with severance and benefits, fired.

Employees can still get severance in lieu of notice if they get fired.

Just sayin

#132 The American on 06.26.15 at 10:35 am

At #128: Holy Crap Where’s the Tylenol, I’m glad you liked Electric Mud BBQ! I’m a self-proclaimed BBQ connoisseur. Having grown up in Oklahoma and living in The Big D (Dallas), I truly thought I had tried it all, including all the regional styles from Memphis, North Carolina, South Carolina, Kansas City, Central Texas, East Texas, and Alabama. Each regional style is completely different from the other. So, I was skeptical.

My friend is the one who guided us there at his recommendation. We walked for about 3,000 blocks to get there. I started complaining about the walk at about 1,000 blocks in. So I was thinking to myself, “this place better be off the hook.” Indeed it is. We ordered a ton of food and sides. My favorite items were the BEEF RIBS (best I’ve had in my life) and the cauliflower. My God that cauliflower makes a meal on its own. Shit. Now my mouth is watering, and it’s only 7:30 in the morning. Also, I forgot the name of the drink, but it was made with lime, agave, hard liquor of sorts, and I can’t remember. Whatever it was, get a pitcher or two of it. Prices were very reasonable as well, and service was friendly and efficient.

#133 H on 06.26.15 at 11:00 am

Where did I say “collapse”? — Garth

Garth, for years you have been drawing comparisons to the US, putting up statistics, drawing a line to a crash.

You have been careful not to use that actual word. Instead “melt” or other vague comparisons are used.

I asked you specifically how to short the Canadian real estate market with a financial instrument.

There was a reason for it.

You see, in life, as you know, there are many who are good at saying there is a problem on the horizon, and few who know how to profit from it.

Case in point, this blog has been laced with people praying for the sale of the century to come on homes and most have spent the time they should have been in a house-in a basement.

If this melt, crash, whatever you want to call it is so sure, then why cant someone by an ETN on this.

Seems to me there would be several available if this was sure.

I believe in risk abatement, not in shorting for attemmpted profit. You should learn that lesson, too. — Garth

#134 Calgary Rip Off on 06.26.15 at 11:01 am

Red Deer Rob and # 20 Chris

Yes many people are out of work in Calgary. However there are still many people employed. The traffic keeps getting worse and worse in Calgary. Is it the warm weather that increases traffic in Calgary? At the same time employment is extremely volatile in Calgary and it is all about damage control and pya.

In Cochrane, good luck on getting thru on the 22 in a hurry, dont sell there if you got a rental property. Riversong is almost completed on single family homes and according to a framer I met he cant keep up with demand in that area. Now the condos are going up like crazy in that area.

Perception in Calgary depends on personal variables. It depends on who you ask. As an investment counselor Garth needs to come up with something to drive investing. He may be correct, but given trends, I doubt it. Market value where I live has increased and unless interest rates hit 10% AND oil plummets to $20/barrel I dont see much change happening. Do I think this because I own a mortgage? Not really. I find it laughable that the place I live in now that I bought for $420 in 2011 is now $500K. More wear and tear, and older, and yet stupidly the price has gone up. I view it really just as a place to live in, nothing more, and a way to eliminate subsidizing scum landlord. There are some “good” landlords in Calgary, but most are self entitled people that bought before 2005 when things started to skyrocket. Buying the mortgage really wasnt a choice, but a necessity as the rents are the same as a mortgage, and because I am not 60 years old and about to retire, those personal variables to rent from the bank made sense and still do. The reality that jobs in Calgary are scary, rentals are scary, mortgage ownership is scary, and competition is fierce. This isnt Houston Texas where apartment finder companies will find you a decent place to live up by FM 1960 near Spring that is likeable, affordable, and decent. Land in Calgary is at premium because much of the land is used to grow hay or some non essentials for people that own horses, people with too much time and money.

Saying that all of Canada will react in some way to trends is like saying all of the USA real estate is the same. That’s stupid. Buying a house in Houston, Texas, is not like buying a place in Shoreline, Washington. Different variables, different demographics. Same as Calgary is not like Windsor, Ontario. These arbitrary global trends as presented in this blog are nonsense because they dont account for personal variables and local trends. It’s very easy to take some graph and explain it some way when it may not be applicable at all.

#135 Daisy Mae on 06.26.15 at 11:02 am

#56 MrObvious: “Garth says, take it ASAP. I did and I haven’t regretted it for a moment.”

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

There are always extenuating circumstances. For a newly divorced individual around this critical age bracket who receives spousal support only until OAS and CPP kick in — spousal support dwindling with each application — may find themselves sentenced to a lifetime of reduced benefits. Beware.

#136 Praireboy43 on 06.26.15 at 11:03 am

“Unimaginable”, Heard rumor Connor McDavid will not play in Edmonton. Will be drafted by Edmonton, Trade to Boston for Rask, and Others!!
PB43

#137 Bottoms_Up on 06.26.15 at 11:20 am

I actually like hearing about all the ‘renters in waiting’ and ‘people ready to vultch’.

It means there may be pent-up buying demand that will help buffer any price drops.

The time to buy real estate is when no one wants to…..

#138 Nemesis on 06.26.15 at 11:21 am

#DoubleUnmaginable!!! #Or,YouKnowThingsAreBad… #InElberTahWhen… #NanaimoCan’tShiftProduct…

[CBC] – Medical marijuana company on Vancouver Island lays off 61 employees

…”One of Vancouver Island’s largest medical marijuana companies announced Thursday it is laying off 61 employees.

Tilray, based in Nanaimo, says the cuts were done to “more effectively serve patients.”

http://www.cbc.ca/news/canada/british-columbia/medical-marijuana-company-on-vancouver-island-lays-off-61-employees-1.3128571

#139 fancy_pants on 06.26.15 at 11:31 am

you want to short the housing market? sell you house and rent. unless you don’t have the balls.

Is now the time to listen to the warnings? You would have been hosed doing that 5 years ago when the alarms were first being sounded.

#140 Panhead on 06.26.15 at 11:49 am

#117 TRT on 06.26.15 at 2:52 am
99% of the people here probably failed Calculus or never took it. It’s a course about the area under a graph.

If you don’t understand numbers, then you will be confused on why prices are so high in Vancouver and Torornto. Good luck to the bewildered.

——————————————————-
I was taught that Pie are round and Cake are square …

#141 Holy Crap Wheres The Tylenol on 06.26.15 at 11:53 am

#91 Smoking Man on 06.25.15 at 10:28 pm
#90 not 1st on 06.25.15 at 10:22 pm
Title for Garth`s next book – “F`n Told Ya So”
…..
I agree , but that’s a long way off.
______________________________________
Smoking Man have you got a name for your book yet?

Perhaps “seimmuD rof gnillepS cixelsyD”

#142 Holy Crap Wheres The Tylenol on 06.26.15 at 11:56 am

#138 Nemesis on 06.26.15 at 11:21 am

#DoubleUnmaginable!!! #Or,YouKnowThingsAreBad… #InElberTahWhen… #NanaimoCan’tShiftProduct…

[CBC] – Medical marijuana company on Vancouver Island lays off 61 employees
…”One of Vancouver Island’s largest medical marijuana companies announced Thursday it is laying off 61 employees.
Tilray, based in Nanaimo, says the cuts were done to “more effectively serve patients.”
http://www.cbc.ca/news/canada/british-columbia/medical-marijuana-company-on-vancouver-island-lays-off-61-employees-1.3128571
__________________________________________
Dam there goes my future investment venture. Just thinking with all of the boomers retiring they are going to need their glaucoma meds. Next it will be the beer and liquor stores laying off.

#143 Grantmi on 06.26.15 at 11:57 am

#139 fancy_pants on 06.26.15 at 11:31 am

you want to short the housing market? sell you house and rent. unless you don’t have the balls.

Is now the time to listen to the warnings? You would have been hosed doing that 5 years ago when the alarms were first being sounded.

So because you GUESSED (key word Guessed) right that the WORLD FED’s would take interest rates to ZERO in 2009, and keep them there for 6 years… you have this smug attitude.

If it wasn’t for WORLD WIDE unprecedented historical intervention by the world banks… we NEVER would have seen this run away housing prices in Canada. WAKE UP!!

#144 Mf on 06.26.15 at 12:17 pm

#137 Bottoms_Up

Actually when people start losing money on their houses all that “pent up demand” will evaporate quickly.

If you are as wise as you say, you can remember what housing in Canada was like during the last two crashes in the 80’s.

Parents bought a house in 92′ with a low ball offer. Sellers said no way initially but came back two weeks later because there was not a buyer in sight.

Any correction today will be worse because of the record leverage everyone has.

MF

#145 Ronaldo on 06.26.15 at 12:24 pm

Coming to a county near you.

http://www.bloomberg.com/news/articles/2015-06-26/china-investors-get-that-greater-fool-feeling-as-selloff-deepens

#146 Smoking Man on 06.26.15 at 12:38 pm

#109 YumaGuy on 06.26.15 at 12:35 am
#93 AlbertaGuy on 06.25.15 at 10:40 pm
Smokey… I work in Yuma testing desert heat loads on vehicles… It’s only June and its been 45C for two weeks straight.
….

Try Laughlin same temps as death vally, I was there last week. That’s hot. If your flip flop, flops off your feet . and your foot hits the pavement, your going to the hospital.

#147 Nemesis on 06.26.15 at 12:44 pm

#FunnyAuldWorld…

#LostInTranslation…

“Local departments and organs were also urged to implement the regulation with realities.”

[Xinhua] – New regulation promises “discipline and punishment” for official incompetence

http://news.xinhuanet.com/english/2015-06/26/c_134359671.htm

#TauntingTheGuard…

[Independent] – The moment a Queen’s Guard soldier lost it and drew his gun at annoying tourist

http://www.independent.co.uk/news/uk/the-moment-a-queens-guard-soldier-lost-it-and-drew-his-gun-at-annoying-tourist-10347240.html

#148 james on 06.26.15 at 1:26 pm

http://www.piacweb.org/publications/asses-mix-report.html

Not appropriate for an individual. — Garth

#149 VanUpUpUp on 06.26.15 at 1:27 pm

Hi Garth, how long do you think it will take before we get the first billion dollar sale for a house in vancouver? 10 years maybe??

#150 Bottoms_Up on 06.26.15 at 2:02 pm

#144 Mf on 06.26.15 at 12:17 pm
———————————————
Sorry, please point me to where I said I was so wise? But, I did make a crack about your age. That has nothing to do with my wisdom. ps. you still haven’t provided your numbers on your own personal rent vs. buy calculation.

And, also sorry, I was too young to be following the housing market in the 1980’s. But by all accounts, housing in Canada jumps up, then flatlines for several years, then jumps up, then flatlines. That has been a fairly consistent pattern if you look at the stats.

I think ultimately if you are a renter, looking to enter the housing market over the next decade, and you wonder what the right financial move is, well if you knew housing in Canada would be flat (let’s say you could buy a home now at $400,000 or in 2025 the same home for $488,000, and in 2035 that same home would be $700,000), what would you do today, or what would you plan for? 10 years out I’ve used the rate of inflation. I think that’s where we’re headed. Out to 2035 I’ve used a ‘jump’ in prices. Think about it seriously, what would you do?

#151 Realtor007 on 06.26.15 at 2:03 pm

Bank of Canada will slash to 0.25% by year end says David Madani…

http://business.financialpost.com/investing/the-most-bearish-call-on-bay-street-bank-of-canada-will-slash-to-0-25-by-year-end

Looks likes low rates are here to stay for a while longer.

Actually, it doesn’t at all. — Garth

#152 Bottoms_Up on 06.26.15 at 2:20 pm

#158 raisemyrent on 06.25.15 at 4:37 pm
——————————————————-
I still don’t get why people say teachers are overpaid.

The starting salary this past year for new elementary teachers in Toronto was between $45,000 to $55,000.

https://www.ett.ca/salary-grid-for-tdsb-elementary-teachers-2014-2015/

This is barely above the poverty line in my books. Do you like the fact your child’s grade one teacher rents at Keele and Lawrence because she only makes $45,000/yr?

#153 Mary from Canoga Park on 06.26.15 at 2:23 pm

#98 Retired Boomer – WI on 06.25.15 at 11:10 pm
#79 ANOTHER JIM

Telefunken U-47 …… with leather????”

Stop it right now!

#154 Realtor007 on 06.26.15 at 2:38 pm

Actually, it doesn’t at all. — Garth

——————————————–

Madani has been calling for a RE crash and has been wrong, if we go by his track record you may be right but the evidence is pointing in his direction and he may be vindicated.

Most economists do not believe the BoC will cut again. I agree. — Garth

#155 H on 06.26.15 at 2:55 pm

I believe in risk abatement, not in shorting for attemmpted profit. You should learn that lesson, too. — Garth

Risk Capital Garth. I set aside $50K a year for this. If there is not a good risk opportunity I bank it.

You have spent years laying your case out for the housing drop. I am merely looking for the tool to provide the profit from it.

#156 young & foolish on 06.26.15 at 3:45 pm

“I actually like hearing about all the ‘renters in waiting’ and ‘people ready to vultch’.

Me too, I wonder if they’ll actually pull the trigger when the markets tank.

#157 Bottoms_Up on 06.26.15 at 3:48 pm

#155 H on 06.26.15 at 2:55 pm
——————————————–
He has used the term ‘melt’, which to me implies it might be awfully difficult to make any money off it. Lenders may be doing less mortgages, but if rates inch up they will make more money off current stock (variable) and new mortgages. I wouldn’t hold your breath for ‘scoring’ on a Canadian housing market decline.

#158 Bottoms_Up on 06.26.15 at 3:49 pm

#153 Mary from Canoga Park on 06.26.15 at 2:23 pm
—————————————————————
You’ll love it.

#159 young & foolish on 06.26.15 at 4:00 pm

“After a correction, for those that hold on and don’t sell, the market ends up chugging along to an even higher peak eventually, but it may take years. I am hoping to be in this for the long haul anyways.”

Hmmm … that’s what many homeowners say as well.

#160 Dan on 06.26.15 at 5:08 pm

Well, rich will get more, poor will lose more. What’s new?

#161 bill on 06.26.15 at 5:14 pm

#98 Retired Boomer – WI on 06.25.15 at 11:10 pm
#79 ANOTHER JIM [perhaps from Norway?]
#153 Mary from Canoga Park on 06.26.15 at 2:23 pm
#158 Bottoms_Up on 06.26.15 at 3:49 pm
Fellow ‘other people’ :
I would have put a link here to one of the maestro’s musical creations , however Gail keeps a sharp eye out for that sort of thing….no doubt you have some of your own to listen too?
waka jawaka !

#162 calgaryPhantom on 06.26.15 at 5:15 pm

Most economists do not believe the BoC will cut again. I agree. — Garth

———————————————————————–

Look at last one month performance of TSX, in comparison to US. Markets are asking for a rate cut, and BOC will oblige.

The TSX says nothing of the sort. — Garth

#163 Leo Trollstoy on 06.26.15 at 5:17 pm

I still don’t get why people say teachers are overpaid.

The starting salary this past year for new elementary teachers in Toronto was between $45,000 to $55,000.

Because there are more teachers outside of elementary school.

Because starting salary only applies to the first meaningless year.

#164 Mf on 06.26.15 at 5:29 pm

#159 young & foolish on 06.26.15 at 4:00 pm

Yeah but I’m not leveraged to the tune of 100’s of thousands. I’m leveraged to zero.

MF

#165 Paul on 06.26.15 at 5:29 pm

It’s not that Teachers are over paid. They just stay to long and don’t let the newbes get started!

#166 boonerator on 06.26.15 at 7:06 pm

#29 Vundo on 06.25.15 at 7:09 pm says:
“But aside from making rational decisions, is there anything else one can do to prepare?”
Dude, if you are making rational decisions, you are ahead of 95% of the population.
Stuff happens. As the old saying goes, “If you want to make God laugh, tell him your plans”.

#167 The American on 06.27.15 at 11:29 pm

U.S. Fed will have two, yes two, 0.25% rate increases by year’s end. Mark these words. It’s done and done and already decided.