Home country bias

BABY ON BOARD modified

I thought this was an interesting blog comment yesterday:

Garth you sound like The American more and more. I am open to another man’s opinion. But I will not read your blog anymore with all your pro US and anti Canadian hyperbole. If you love them so much then GTFO.

While some anon hater was writing that, our dollar slipped below the 77-cent US market for the first time since the lights went out in 2009. Commodities (especially gold) lost more ground, pulling the TSX to a reasonable loss. The one-year return for Toronto stocks is negative, at -1%. In contrast, the 12-month return for the Dow is 9% and the S&P has increased 10.8%. The Nasdaq is ahead 21% year/year while being up almost 11% so far in 2015. And it’s only July.

Only a fool would not want a globally-diversified portfolio. After all, in Europe the French market has added 23% this year, outpacing the gain in England (6.7%) and even the German market’s advance of 19%. As mentioned a few days ago, the Chinese market – despite recently laying an egg – has returned 95% in the twelve months. Even stocks in poor deflationary Japan have given investors there a 19% goose so far this year.

Sadly, almost three-quarters of all Canadian investors have 100% of their assets in Canada, in Canadian assets, denominated in Canadian dollars. Not only have they taken a beating with a serious devaluation of the dollar (down over 3% in three months), but Canadian equity holdings have clearly lagged the rest of the world. Meanwhile a misguided monetary policy has kept interest rates in the ditch, heavily penalizing those who save their money and stuff it into interest-bearing investments.

It’s not anti-beaver to point these things out. Because we’re a small population rattling within a large country, living beyond our means and therefore dependent on exports and commodity values, if your whole portfolio’s made up of maple assets, risk is accentuated. Yeah, I know this is what [email protected] bank recommended – Canadian equity index funds, Canadian balanced funds, a nice Canadian bond fund, all topped off with a Canadian market-linked GIC – but that’s because the bank makes money from fees, not results.

It’s also not betraying our national ugly aquatic rodent, or even artery-murdering poutine, to point out we’ve all spent the last six years getting pickled in debt as we sell each other houses at ever-higher prices. The average property in 416 traded for $421,110 in the summer of 2009. This summer that number (houses and condos) is $682,264.

But while house prices increased 38%, and household debt doubled, incomes grew less than 12%. Six years after the GFC our dollar is at the same abysmal level, our trade deficit has rocketed higher, provinces and households are swimming in loans, we’ve added $200 billion to the national debt, and the central bank this week was forced to slash interest rates because of a recession.

And this is where you want to have all your money?

Seriously. There is more pain to come. Once the Fed starts to increase its rate, adding 1% per year for the next two, our currency will slump further. There is no doubt in my mind the Bank of Canada will be forced to reverse course and increase its overnight rate, starting some time in 2016. Meanwhile, as posted here yesterday, fixed-rate mortgage rates will be higher months earlier. Imagine what that will do to real estate. And there’s absolutely no reason on the horizon for oil prices to improve, as the world continues to be awash in surplus crude.

This is why a nicely-diversified portfolio would have just 17% Canadian exposure in its growth component, a touch over 20% US and about 18% international. It’s why you also want balance, with close to 20% in rate-reset preferreds which today pump out a 5% tax-reduced dividend, and will chug higher along with rates. (They’re also on sale at the moment.) Other components I have already discussed. Google it.

By the way, did you notice that inflation just popped? That’s what a cheap dollar brings. If you can live without lettuce, iPhones or a Harley, it doesn’t matter. But what a sad life that would be.

By the way, I love my country.

Why else would I do this every day?

218 comments ↓

#1 ShawnG in TO on 07.17.15 at 6:12 pm

wow, i thought blog dogs here are smart (except realturds, of course). i have to admit i was wrong.

Diversity. Balance. the message is very simple to understand. why are some people have such hard time?

#2 Tim on 07.17.15 at 6:13 pm

I’m up over 12 percent this year, with about 35% US/Intl and the rest CDN dividend paying stocks. Best way to go. Stay out of bonds. Buy telcos and utilities who pay dividends that are higher than the return of bonds.

#3 mark on 07.17.15 at 6:18 pm

Always nice when the markets go no where but being unhedged from parity still makes you money.

Might be a little nuts but 50% split between DFA unhedged global equity funds and 10% in DFA global real estate. Certainly left domestic returns for dead.

#4 irent on 07.17.15 at 6:22 pm

Thanks Garth for educating us!

I have a question regarding the Fixed Income portion of the Balance Portfolio. Should they be distributed the same way Growth assets are between US, CAN, Intl.

Thanks Again!

#5 JSS on 07.17.15 at 6:23 pm

For those who are heavily weighted in Canadian equities and bonds, isn’t it late in the game to buy non-Canadian? by the time one rebalances, the Canadian equity market will have taken off.

#6 Broke Dick on 07.17.15 at 6:24 pm

I always thought it was baby on broad.

#7 Jordan on 07.17.15 at 6:24 pm

Garth, I also love my country but don’t like the Canadian political system at all. Boc should be independent from the PMO. Real estate cartels should be forced to make their data public and stop that ridiculous Frankenumber.

#8 Jordan2 on 07.17.15 at 6:25 pm

Garth, I also love my country but don’t like the Canadian political system at all. Boc should be independent from the PMO. Real estate cartels should be forced to make their data public and stop that ridiculous Frankenumber.

#9 canuck in socal on 07.17.15 at 6:27 pm

Haters gonna hate, as they say.

Canada is a perfectly lovely country with vast expanses of wilderness, but it pales in comparison to USA when it comes to economic opportunity and innovation.

I’ll definitely spend my increasingly valuable USD in relatively cheap Canada when I want to hike the mountains or sail the Vancouver Island inside passage.

If only the feds would assign more value to the relatively pristine environment, rather than watering it down to appease the grubby mining and oil giants. I guess when your economy is based on digging holes and sucking out resources, the habitat takes a backseat. Pity.

I’ll be watching with interest under the swaying palm trees this fall as Canadians elect a Prime Minister that (hopefully) values the great gifts Mother Nature has bestowed Canadians.

And I will gladly share our experience here in California, which has a much more diverse economy that is bigger than Canada’s yet with the strictest environmental protection laws in North America. It can be done, people.

#10 Retired Boomer - WI on 07.17.15 at 6:27 pm

You love your country, I like mine, too. As it should be.

I hold about 30% of my equity portion in the total international stock market. A lot of the rest is in the total stock market index, except for about 50 grand in utilities and about the same in oil & gas majors stock, and a health care sector ETF.

That’s 70% the rest is in bond type instruments.

No, it’s not perfectly balanced. Neither am I.

The utilities and oil and gas make me feel the PAIN of the Canadians.
Those three are “El Sucko” this year. A saving grace is the dividends. The debt instruments have been ‘dead money’ except for the dividends, but that’s what they’re for and to soak up money when equities take to the deck!

So, what’s been the track record of this crap for the last 5 years? 8%
(Remember I diddle at the edges all the time so it is not a static portfolio).

Close to that 7% for the perfectly balanced, but then, I have never been balanced in my life like so many others around here.

#11 Mean Gene on 07.17.15 at 6:28 pm

Harley Davidson = Varooommm.

#12 Andrew on 07.17.15 at 6:28 pm

I was planning on commenting on this blog today to discuss the amount of your portfolio you should have in Canadian equities right now, and low and behold there it is.

I currently have 15% in Canadian equity and with the way things are going I thought now could be a good time to reduce this to around 10%. As Garth says I don’t see any good news on the horizon in Canada and I suspect it’s downhill from here for a good while.

Is there a reason to maintain 17% in Canadian Equity?

#13 Spaccone on 07.17.15 at 6:29 pm

Garth, if we have to wait around 3 generations for rates to increase then the one-asset cult has little to worry about. Yes, understood that was typo.

#14 BobC on 07.17.15 at 6:31 pm

Can’t believe someone would send you that. Do all you can to help the financial future of fellow Candians and that’s the thanks you get. Just ungrateful and small minded. Don’t let them get you down.

#15 Vancouver Troy on 07.17.15 at 6:31 pm

Great article. Thanks.
How does one buy rate-reset preferreds? Is there an ETF holding them?

#16 Goldie on 07.17.15 at 6:34 pm

Open rebuke is better than love carefully concealed.

If one loves one’s country truly then one should be compelled to point out when it’s being run poorly.

NOT caring about one’s country would be telling people that the country is doing great even when one knows that this not true, just to avoid hurt feelings.

#17 Obvious Truth on 07.17.15 at 6:35 pm

Can’t question people in seemingly positions of authority in Canada Garth. They wear a suit, work for a bank or government and the masses gobble up their words.

We know that people hate it when they are part of the herd and they are wrong. They feel stupid, get defensive and lash out.

It’s why most people on this blog can’t talk finances with their friends and family.

Quick story. Talking with a friend yesterday after she met with someone who advocated investment properties for cash flow. I sent your post from yesterday to them. I prefaced it with saying ‘you are doing fine; is debt what you really want’.

The response to your post: ‘opinionated or what?’

It may be an impossible battle. Math doesn’t count for a whole generation. It’s all about the monthly, the loc and about refinancing for a very long time.

#18 Broke Dick on 07.17.15 at 6:37 pm

While some anon hater was writing that, our dollar slipped below the 77-cent US market for the first time since the lights went out in 2009. Commodities (especially gold) lost more ground, pulling the TSX to a reasonable loss. The one-year return for Toronto stocks is negative, at -1%. In contrast, the 12-month return for the Dow is 9% and the S&P has increased 10.8%. The Nasdaq is ahead 21% year/year while being up almost 11% so far in 2015.
============================

wow imagine that! Our economy is not keeping up with the US of A!
Is this a first?
Are we forgetting that the US STILL has rates at .25%?
When so may countries are trying to devalue they’re currencies by dropping rates is Canada not expected to follow?
Did every one forget about Q1, 2 ,3 and 4?
Canada is trying to hold it’s own by devaluing the dollar, so for everyone who thinks it’s about house prices sucker up! Snorkling man told you years ago, get in while the gettin’s good.

#19 Shawn on 07.17.15 at 6:39 pm

Conventionally backwards on FX

The other day I was commenting that FX quotes appear to be backwards in some cases and Trading Naked had a good response for me.

I said:

CAD/USD is reported as 0.784.

Clearly it is the other way around The USD dollar is 78.4 cents per Canadian dollar so USD/CAD = 0.784.

Where did this industry go to school?
===============================

Trading Naked responded:

Ummm that’s just a convention. When I turn on Bloomberg they report USD-CAD at around 1.27 because 1 USD turns into 1.27 loons. Flip the ratio around and you get CAD/USD quoted at 0.784. I always read the first in a currency pair as “1 of…”

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

Trading Naked is quite correct I looked it up and CADUSD = $0.76 means it takes U.S. $0.76 to buy one Canadian dollar.

But sites (like Yahoo Finance) that put in a slash and report this as CAD/USD = $0.76 are wrong to do so.

The “/” is in my experience a universal symbol for division. They can’t take a universal convention for division and use it backwards like that.

Most likely explanation is financial journalists with little math skills adding the slash.

CADUSD is $0.77 because it takes only U.S. 77 cents to buy one Canadian dollar. No division sign is used.

But CAD/USD would normally be read as Canadian dollar per U.S. dollar and that is CAD $1.30 per U.S. dollar.

It’s perhaps a small point but financial sites should use the FX convention correctly and not insert a slash which normally means divided by since that is not what is meant by CADUSD.

Also we use too many short cuts and abbreviations. It’s not really correct to say the Canadian dollar is worth 77 cents. 100 cents is not worth 77 cents. What is really meant and what should be said every time is the Canadian dollar is worth 77 U.S. cents.

#20 Broke Dick on 07.17.15 at 6:40 pm

One last thing.
Garth,you sound as if you are the leader of the opposition.
For every move the government makes you take the opposing view point.

#21 TRT on 07.17.15 at 6:41 pm

Garth said “There is no doubt in my mind the Bank of Canada will be forced to reverse course and increase its overnight rate, starting some time in 2106. ”

—–/———/————-/

This where we have been disagreeing for the past 5 years. If the Cons get back in, they will continue to punish the currency to protect the FIRE sector. Have you not learned that the Harper, BoC, and Cons are in bed with certain sectors?

#22 bb on 07.17.15 at 6:43 pm

2 years ago if my memory serves me right CAD was trading at 0.99 to 1 for 1USD. Friends told me to sell all my USD as the economy was booming and US continues to print $$. Good thing I procrastinated until now. See Garth. Procrastination ain’t that bad.

#23 Yaroslav on 07.17.15 at 6:46 pm

“There is no doubt in my mind the Bank of Canada will be forced to reverse course and increase its overnight rate, starting some time in 2106.”

That’s 90 years from now. 2106-2016= 90.
Whew! I’m safe. Thanks Garth.

#24 totalinvestor.com on 07.17.15 at 6:47 pm

Leave him alone Garth, haters gonna hate.

http://i62.tinypic.com/w814qu.jpg

#25 Danforth on 07.17.15 at 6:49 pm

First 17 days of this month alone have shown me a 5.27% return across all my assets (partly influenced by the dollar..i know)
Yet my Canadian holdings are in the negative.

It pays to diversify.

#26 TRTh on 07.17.15 at 6:49 pm

70% of investors have only Canadian assets?

WTF? Canadians are more clueless than I thought. Is today April 1st?

#27 nonplused on 07.17.15 at 6:50 pm

I think I could get along without lettuce. And maybe the iPhone too.

#28 mitzerboy aka queencity kid on 07.17.15 at 6:51 pm

thank christ for the usa ….

who else on earth would u want callin the shotz

#29 Yaroslav on 07.17.15 at 6:51 pm

I remember an old t-shirt that used to read:

“If you are Canadian, show me your beaver”.

Viva la castor libra!

#30 Vundo on 07.17.15 at 6:55 pm

I hope that’s a typo and not a prediction that interest rates will not normalise for another 90 years…

Anyway, your mileage may vary when it comes to advice from the bank. I once had an “advisor” at a financial institution try to sell me on the idea of putting everything I had into one mutual fund (which as it turns out sucks even compared to similar funds with simiar MER’s). This was close to the beginning of my finanial literacy journey, but even then I knew the right thing to do was run away. Then I talked to someone at another institution, who actually did talk to me about diversification and offered options that Garth would still criticize for being too high on the MER fees, but are still far more sane than the crap I was originally offered. Not all ladies/gentlemen at the bank are as nice as all the others. Some almost sound like what I read here. Some are complete lunatics.

#31 Paul on 07.17.15 at 6:57 pm

you love your country?

Only the Greatist fool would think otherwise !!

#32 james on 07.17.15 at 6:57 pm

Consumer Confidence Index in the USA is up 11% over last year. Mortgage rates are rising, but in many cities prices are still going up. My area is up 12% over last year, with 1.5 months of inventory on the market.

Even more shocking, our corporate shares are up 16% today alone. I don’t like to see that sort of volatility, but it shows money is flowing into the market. I’d rather see a pullback of 20%…

Not too pleased about the Canadian dollar, since I still have assets in Canada, but it makes sense. It will go lower.

As for your anon hater, I agree. Just got the green card, and I have no intention of returning. Not that the USA is perfect, but there are far more opportunities here. Canada is a sinking ship right now. I shocked a couple of my coworkers by telling them about Ontario’s debt levels and corruption. Glad to be out of there.

#33 waiting on the westcoast on 07.17.15 at 6:58 pm

It is depressing that they didn’t do the right thing and hold rates. We need to get more competitive, but less. Here is to us following the 3rd world model of letting our currency tank so we can support inefficiency. Maybe we can default later too.

#34 Who Cares on 07.17.15 at 7:01 pm

Sounds like you made a realturd angry for exposing the truth. Like who cares if it doesn’t read your blog we care less what realturds have to say!!!

#35 Mark on 07.17.15 at 7:05 pm

The damage of the low CAD$ to investors’ portfolios has largely been done. At what point does buying Canada, buying gold and silver stocks, etc., become a contrarian play, rather than piling into the richly valued US stocks which seem to be suffering increasingly shaky metrics?

For those who think that the CAD$ is going to weaken substantially further, and that deflation’s not going to happen, please explain why, according to today’s Mish (Mike Shedlock) post, the following are Canadian GoC bond yields:

“•30-Year: 2.242%
•10-Year: 1.562%
•7-Year: 1.154%
•5-Year: 0.705%
•4-Year: 0.446%
•3-Year: 0.383%
•2-Year: 0.423%
•1-Year: 0.445%
•6-Month: 0.435%
•3-Month: 0.400%
•1-Month: 0.390%

Sure looks to me like investors are piling into the trade for either deflation or further BoC policy action. And/or a significant rise in the CAD$. Even the US T-bond market, despite the huge shift of capital to the US on account of Euro and Chinese fears, doesn’t trade at such low yields except for the very short end of the curve.

#36 Andrii on 07.17.15 at 7:06 pm

Thanks Garth , you are right , I was stupid enough to change USD to CD , when it was 0.86 . Should I changed currency back not to suffer another drop ? I may be in need of money next 5 years . Is it makes sense to invest ? Appreciate your answer .

#37 saskatoon on 07.17.15 at 7:06 pm

garth,

so how low is gold gonna go?

are we talkin’ doorstep level?

#38 Broke Dick on 07.17.15 at 7:06 pm

#10 Mean Gene on 07.17.15 at 6:28 pm
Harley Davidson = Varooommm.
======================================

Sorry but it’s po-ta-to po-ta-to

#39 Pontius Pilatus on 07.17.15 at 7:08 pm

The other day I was in the line-up to renew my passport.
In front of me was a guy with an “I’m a Canadian” t-shirt which of course is a Molson Canadian beer slogan.
In good fun, I asked him that I hoped he had more documentation to prove his citizenship than the t-shirt.
He kinda shrugged me off.
Well, just another day in the line up at your local Passport Office.

#40 Godth on 07.17.15 at 7:08 pm

“Only a fool would not want a globally-diversified portfolio. After all, in Europe the French market has added 23% this year, outpacing the gain in England (6.7%) and even the German market’s advance of 19%. As mentioned a few days ago, the Chinese market – despite recently laying an egg – has returned 95% in the twelve months. Even stocks in poor deflationary Japan have given investors there a 19% goose so far this year.”

What the hell does any of that actually mean though? Yeah. yeah – myopic money, but how accurately is it describing ‘reality’ – it’s all juiced by unprecedented policies. Smoke and mirrors don’t add value to reality,well except for a very few.

It’s great you call out all the Canadian nonsense but to then turn a blind eye to all these other market shenanigans is simply perplexing. Bizarre actually, if anyone can follow your Canadian logic/analysis and then simply look around at everyone else. We’re hardly alone.

i just don’t see any sort of stable future in it, but then I’m 20 yrs. (at least) younger than you and all I see is UNSUSTAINABLE. Celebrate your short term gains but Jaysus on a pogo stick…

#41 Godth on 07.17.15 at 7:15 pm

#8 canuck in socal on 07.17.15 at 6:27 pm

lol, enjoy the drought. Where will the residents of California go in a few years? I hear if you suck on a rock it helps.

#42 Brian Ripley on 07.17.15 at 7:20 pm

The last time the USD was in a bull market big time was in the prelude to the crash, 2008-2009, chart:
http://www.chpc.biz/canadian-housing-in-usd.html

As the CAD drops against the USD, investors are forced into paying attention to their budgets AND portfolios.

A lot of global debt is priced in USD and has to be repaid in USD which creates demand for USD.

Off-shore buyers of Canadian assets are not happy.

#43 Leo Trollstoy on 07.17.15 at 7:21 pm

Spot on post today.

CAD sucks and will suck more in the future.

Ditto for oil and gold.

USD is king.

#44 Musty Basement Dweller on 07.17.15 at 7:27 pm

Thanks for killing the loonie and making our costs higher Mr bozoloz. Too bad it seems to no longer be an ineffective strategy in terms of the greater good for the economy, it would be much easier to support if there was an solid evidence that it was or will be.

#45 Boris Stellov on 07.17.15 at 7:33 pm

A sad life is living paycheck to paycheck and not knowing how to pay your bills.

A sad life is paying credit card balances with other credit cards and maxing out $3,000 limits having 3, 4 cards now.

A sad life is paying your car repair bill and paying for gas accumulating debt with am gasoline, auto credit cards being charged you 2.4% monthly interest, 28.8%.

Depending on payday loans, legal loansharking. The more stuff you have, the more your life gets complicated and meaningless.

Putting $3,300 a month in my pocket even at 2.5% to 3% interest rates tax deferred, tax free is better than having a mortgage payment, property tax bill, home repairs, maintenance, home insurance, real estate commissions, H.S.T, lawyer fees etc. etc. and all the hassle of home ownership.

Renting has served me well as I have accumulated $5,000 in savings account, $25,000 in GIC’s, $89,000 in RRSP’s and $45,000 in TFSA’s in just 5.5 years. I am only 26 years old now.

I don’t want to throw it down a big black hole and be left with almost no savings, RRSP’s, TFSA’s etc. and be in debt for the next 25, 30, 35 years, heck, now it is normal for seniors to have $30,000, $40,000, $50,000 in debt.

It is overrated anyway. Why would I want to give up my 700 square foot, $800 a month apartment with 2 bedrooms. It is clean, only in a 7 year old building and the tenants are quiet and decent people.

The landlord is respectful and repairs, maintenance are done in reasonable time. We can have a pet too. It is all fine by me.

#46 LoveThisBlog on 07.17.15 at 7:33 pm

Does anyone remember the term ” Peak Oil crisis”? LOL. Right in there with Global warming.

#47 AisA on 07.17.15 at 7:34 pm

“we’re a small population rattling within a large country”

I still cringe at the degree of non comprehension of this by the same said small population. The fact that a property bubble can even be formed in land mass as enormous and unpopulated as the one we call home is nothing short of absurd.

To the “they ain’t making land no more” crowd I offer this…. they ain’t making immortality pills either. Owner comes, owner goes.

#48 ANON on 07.17.15 at 7:34 pm

HCB lasts just about as long as you don’t really notice how much better the neighboring countries are doing, because you’re still doing okay.
When you’re no longer doing okay, the narrative changes abruptly. Seen it, but never been guilty of it, since it has gotten pretty bad by the time I could become biased, so I become biased in other narratives. I have no illusions I would have been immune to the HCB, had I somehow lived the incredible boom (credit fueled, of course, there’s no other kind) and pride that came with it. It is just human nature.

#49 Ed on 07.17.15 at 7:38 pm

Anger rules when EQ is low:

Anger is a left brain emotion–easily accessible. When someone is overwhelmed by the shear stupidity of what Canadians have done and has not learned how to self-regulate, anger is the default emotion, much easier than taking self-responsibility. Other emotions (sadness at your own mistakes, ambiguous feelings) take a fair amount of maturity to process.

In other words, anyone who has drunk the RE Koolaide does not have enough emotional maturity to admit their mistake; getting angry at someone else (the Chinese, GT, or anything USA) is an easy out.

#50 saskatoon on 07.17.15 at 7:38 pm

anyone have any ideas what happens to used car prices in a recession?

they go up…

or down?

#51 will on 07.17.15 at 7:40 pm

Yes Garth I did notice inflation just popped. Hard not to notice especially when both national newspapers are reporting it. But did Plutz notice? This is why I think Plutz must have skipped class that afternoon when the prof was talking about core inflation. But of course we all know that the current BoC is not independent.

#52 Smoking Man on 07.17.15 at 7:41 pm

#32 waiting on the westcoast on 07.17.15 at 6:58 pm
It is depressing that they didn’t do the right thing and hold rates. We need to get more competitive, but less. Here is to us following the 3rd world model of letting our currency tank so we can support inefficiency. Maybe we can default later to….
……..

They had no choice, Doh Doh bird is running Ontario into the ground.

I buddy of mine owns a polyurethane mfg business, he was about to move it all to North Carolina. Hydro rates are killing him and the pension plan will be a big hit… He said he’s holding off, low dollar is helping his exports.. Sales up 33% in last two months.

But as soon as the Loony gets with in 20% of par he’s gone. He’s expecting it to go to 60 cents.

#53 Terrier on 07.17.15 at 7:44 pm

Garth, you can’t fix ignorant … keep the good reads coming and share thoughts with those who’re getting ready for the upcoming storm.

#54 Boris Stellov on 07.17.15 at 7:57 pm

To #48 Saskatoon

In a recession or economic downturn, unemployment increasing and just a crappy economy when people are not buying much new cars, used car prices go up because they are cheaper to buy and more demand to buy them goes up.

I remember in the U.S. when new and used SUV’s, truck prices were crashing when gasoline prices were $4 to $5 a gallon U.S. and people wanted to get rid of them.

During the last U.S. recession, economic downturn, used car prices increased as more people could not buy, finance, lease new cars, trucks etc. and switched to buy used cars.

#55 Nagraj on 07.17.15 at 7:57 pm

There’s like eight keys between 1 and 0, so if yer gonna type 2106 instead of 2016, it’s likely a parapraxis, eh?

“The Psychopathology of Everyday Life” dates to 1901.

Spellcheck has taken the fun outta reading . . . good thing there aint no numbercheck too.

As for “home country bias”, that could also be just nasty JINGOISM. Who said “Patriotism is the last refuge of a scoundrel”? [Hint: it was said on 7/4/1775]

Anyway, I laughed out loud when I got to your 2106. I was thinkin wozzat, his house number? Late rendezvous at night? A phone no.? He’s thinkin 91 years ahead, wow.

This blog is a truly scary place. — Garth

#56 Daisy Mae on 07.17.15 at 8:00 pm

“Only a fool would not want a globally-diversified portfolio. After all, in Europe the French market has added 23% this year, outpacing the gain in England (6.7%) and even the German market’s advance of 19%. Sadly, almost three-quarters of all Canadian investors have 100% of their assets in Canada, in Canadian assets, denominated in Canadian dollars.”

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

Such a shame. Am I ever glad I have you for a financial advisor! I’m so happy with the results I’m seeing. You are THE best!

#57 espressobob on 07.17.15 at 8:05 pm

#14 Vancouver Troy

This link should help.

http://www.bmo.com/gam/ca/advisor/products/etfs/product?fundId=92496

#58 waiting on the westcoast on 07.17.15 at 8:08 pm

Garth – if you are going to edit my posts for making fun of your typos, the least you could do is fix my auto correct typos while you are at it… ;-)

SM – so your buddy moves his business and a few others do and they tell two friends… What happens?

The government will eventually have to start changing policies to become more competitive. Hopefully, ON and the rest of Canada will see that spending money on policies/infrastructure/training that adds value (increase revenue/employee or lower costs/employee) is better than taking the easy short-term drop to the dollar.

Then again, they probably won’t do that even if that was the only choice.

#59 Smoking Man on 07.17.15 at 8:17 pm

#45 LoveThisBlog on 07.17.15 at 7:33 pm
Does anyone remember the term ” Peak Oil crisis”? LOL. Right in there with Global warming.
…..

I sure do, what ever happened to Rosenberg, celebrity book author.

Like all other big misses, just lay low for awhile, people forget.

Climate gate… What’s that?

#60 pwn3d on 07.17.15 at 8:20 pm

inflation popped? from .9% to 1%? that’s a joke right?

#61 ANON on 07.17.15 at 8:20 pm

#48 Ed on 07.17.15 at 7:38 pm
Anger rules when EQ is low

Anger rules when promises are broken. You might be unpleasantly surprised by higher IQ’s excuses and potential to get really, really angry.

#62 pwn3d on 07.17.15 at 8:21 pm

#54 Nagraj on 07.17.15 at 7:57 pm
There’s like eight keys between 1 and 0, so if yer gonna type 2106 instead of 2016, it’s likely a parapraxis, eh?

“The Psychopathology of Everyday Life” dates to 1901.
—————–

It actually dates to 1109.

#63 David on 07.17.15 at 8:21 pm

I don’t like paying the 15 percent withholding tax on US stocks. That’s one of the reasons 100 percent of my money is in Canada. I don’t trust US investments. I feel safe here and don’t lose sleep worrying about crazy happenings beyond our borders.

You need not pay any tax. Buy in C$. — Garth

#64 Obvious Truth on 07.17.15 at 8:22 pm

As for stocks it feels like everyone is going to turn to the same place; USA.

Could have a crazy rally if the chase is on.

RE is so boring.

#65 Republic_of_Western_Canada on 07.17.15 at 8:22 pm

#8 canuck in socal on 07.17.15 at 6:27 pm

How’s that water shortage working out for ya?

#66 dosouth on 07.17.15 at 8:24 pm

…and is why the Big 5 aren’t passing on the total .25% to the consumer. There are more sheeple to be fleeced.

Can’t believe there aren’t more people up in arms or Social Media about this money grab and greed, but then hey, we’re just polite Canadians.

The banks are under no obligation to do this, and if they did, savers would making 0%. Why? So you borrow for less? — Garth

#67 Mister Obvious on 07.17.15 at 8:27 pm

#44 Boris Stellov

I hate to tell you this son, but are now formally charged with making too much sense.

#68 Republic_of_Western_Canada on 07.17.15 at 8:32 pm

#11 Andrew on 07.17.15 at 6:28 pm
[…]
Is there a reason to maintain 17% in Canadian Equity?

Yeah. First off you can’t claw back your 38% dividend hold-back on US shares from Uncle Sam, unless it’s in an RSP. Even then it could be a fight if any identifiable portion of company revenue comes from international sources.

Second, there are good resource sector companies who will fight tooth and nail to maintain dividend payouts over the next year, despite falling stock prices.

So you could end up with a 20% dividend payout for awhile, with an excellent chance of substantial retracement upward when oil prices recover. Even if no recovery, stock price will jump substantially for a week when the bean counters assert that corporate value is higher if dividends are suspended.

#69 Godth on 07.17.15 at 8:35 pm

#51 Smoking Man on 07.17.15 at 7:41 pm

I had you in mind:
The Gervais Principle, Or The Office According to “The Office”
http://www.ribbonfarm.com/2009/10/07/the-gervais-principle-or-the-office-according-to-the-office/

I’ve always enjoyed playing this game by turning the tables. My last job I was making over 6 figures (and up for promotion). I like to make myself more competent than my immediate ‘superiors’ (not hard) by making them look bad by producing better work. When the sociopaths above them take notice and start restructuring then I wait to pounce. My last job was so full of politics it was incredible (working for one of the top ten largest corporations in the world). I have a genuine interest in doing my best work and satisfying the customer, but that’s not always looked upon favorably as someone else has to meet those standards too. So when I’m faced with this sort of hierarchy I demonstrate my best abilities, those that can exploit this notice, I get access to all sorts of information and the turbulence starts churning. When the sociopaths start their plotting and scheming, screwing people over and such I just keep performing. When the time comes to really shift things around I quit. It’s a lot of fun to watch their faces pucker. My last job I quit on the very day they were going to promote me. It was really hilarious, I timed it perfectly. Pathetic but true, I’ve done this repeatedly in large organizations. There’s a certain satisfaction in it, plus I never really take it seriously (they do). hahaha F’em

Small business is a different story.

#70 waiting on the westcoast on 07.17.15 at 8:35 pm

I think the US will tighten this fall/winter. If it does, how soon do we anticipate the slowdown in the US economy? A year? 2 years?

I am thinking it might be good selling a US business now rather than waiting for the next recession… even if it’s not a big one…

No U.S. recession on the horizon. — Garth

#71 Drill Baby Drill on 07.17.15 at 8:36 pm

“It’s also not betraying our national ugly aquatic rodent”
Ugly ? Rodent ? Them thar is fighten words cowboy !

Although you are dead right about your portfolio mix.

#72 Smoking Man on 07.17.15 at 8:38 pm

#50 will on 07.17.15 at 7:40 pm
Yes Garth I did notice inflation just popped. Hard not to notice especially when both national newspapers are reporting it. But did Plutz notice? This is why I think Plutz must have skipped class that afternoon when the prof was talking about core inflation. But of course we all know that the current BoC is not independent.
……..

It’s fricken amazing how most people beilive rates are spiked or lowered on CPI. That version of inflation.

Mind you MSM sells it that way….

Central banks look at the output gap… Translation, wage growth, brought on by unemployment rate.

No jobs, or shit jobs, rates low.

Tight labour market, wages go up, rates head higher.

And in Canada’s case.. The trade balance. Until that goes positive for atleased 4 months.

There will be no tightening till then. Gauranteed.

BOC is puzzled what export aren’t flying out the window.

Not I, I beilive the US dept of stats fibs. I beilive Yellen is yelling I’m spiking.

It’s all about confidence, and trying to create it.

IF the herd thinks things are getting better, they do, and they spend.

Mist of the job creation if true, has been bartender and coffee servers.

And those establishments don’t buy auto parts..

Dr Smoking Man
PhD Herdonomics.

#73 Spectacle on 07.17.15 at 8:38 pm

#49 saskatoon on 07.17.15 at 7:38 pm
anyone have any ideas what happens to used car prices in a recession? they go up…or down?

———————-
Answer: cars are like material assets or commodities. They are marquee specific too! It was a hobby of mine for 30 years… I have realized profits of 40% to 100% , but, very dependant on the model etc and the market period or cycle. Once a vehicle has run its cycle, it’s over! Bail.
On a final note, vintage trucks are a big thing now. I feel that cycle has run its course. If you want to invest in cars etc, buy The Very Best asset class you can: the marquee ( ferrari, Lamborghini , Porsche) but buy the best year, make and model . A porsche 944 or a ferrari Mondial , Murcialago will be a liability, not a business plan. A collector investment quality vintage 911 porsche costs same or more than a 2015 911! Know your market.

Why do you ask?

Regards,

#74 Interstellar Old Yeller on 07.17.15 at 8:40 pm

I used to be silly and only hold Canadian investments (mutual funds and GICs! Face-palm!) That changed when I started reading this blog. My U.S. and international ETFs are doing great. Thanks, Garth!

#75 BS on 07.17.15 at 8:40 pm

For those who think that the CAD$ is going to weaken substantially further, and that deflation’s not going to happen, please explain why

The BoC wants to devalue the CAD to help make manufacturing more competitive. The CAD is also correlated to oil prices which are weak and look to get weaker. Other commodities could also be going lower with China slowing. With the election coming up a minority government and or a left leaning government will also devalue the CAD. Finally at some point when housing crashes the federal government will start running massive deficits to try to stimulate the economy. That will put further downward pressure on the CAD. Nothing going forward looks positive.

On the other side of the trade the US is doing better and is the senior currency. In times of instability in the world, which I think we will see more of, people buy the senior currency. The presidential election will also likely help the US.

Both of the above will continue to put pressure on the CAD vs USD. That will cause inflation as imports become more expensive. We will see deflation in asset prices like housing and no wage inflation which may offset some of that inflation, but as far as the CPI is concerned I doubt we see deflation.

#76 Meek and Mild on 07.17.15 at 8:47 pm

Go ahead and laugh at me. I am really scared. I don’t like storms, especially of the economic variety. There are too many smug and bragging blog dogs. All I can do is sit and watch bubbles getting larger and holes becoming deeper and darker. What a sad and greedy world we live in. Have a nice weekend folks.

#77 Llewelyn on 07.17.15 at 8:55 pm

Day after day your blog contains testimonials from wealthy people seeking advice on how to increase their wealth and prepare for retirement.

Clearly Canada provided an environment that created substantial wealth for hundreds of thousands of citizens, including citizens that sold their houses to greater fools, your words not mine.

I get your pitch to purchase a diversified portfolio but I must agree with the comment that obviously touched an exposed nerve. You have become very down on Canadian equities and on the current state of our economy.

I would be willing to bet that if I asked Canadian citizens not familiar with this sight who the author of the anti-Canadian blogs was I am pretty sure many would mention Kevin O’Leary, the King of bashing Canada.

My father worked for Eaton’s of Canada for 45 years and I can still remember his observation the day Walmart bought the majority of Woolworths stores in Canada.

“Son the thing about Walmart is that they view Eaton’s as an enemy to be conquered while Eaton’s has always tried to work co-operatively with their competition. They will pick Canadian retailers off one by one until they have become the dominant force in Canada”

Sadly his observation is coming true not just for Canadian retailers but for other key sectors of out economy as well. Magna International that was incubated in Canada now has more employees in Mexico than in Canada.

Loblaw’s and the Weston family built their fortune in Canada but see no problem manufacturing all their goods in third world countries.

Our banks became world leaders on the backs of Canadian citizens but currently invest only a small portion of their profits to support the development or expansion of Canadian businesses.

To quote Mr. Wonderful money has no nationality well Kevin and Garth I respectfully beg to differ.

I liked the old Canada where our goods were actually made by Canadian citizens. This was the foundation of the wealth that you are trying to protect for your readers by suggesting that they minimize their current investment in Canada.

I really don’t think that this advice is of any benefit to future generations, do you?

Sorry if it sounds like I am out of step with current realities, sadly memories work that way.

#78 cramar on 07.17.15 at 8:55 pm

“By the way, did you notice that inflation just popped? That’s what a cheap dollar brings. If you can live without lettuce, iPhones or a Harley, it doesn’t matter. But what a sad life that would be.”

—–

Well as mentioned yesterday, I’m temporary awash in lettuce. Maybe would like an iPhone, but have zero need or use for one. Ditto for Harley.

I want to cut back on consumer consumption. Just buy what is absolutely needed. Sad life without consumer items such as iPhone or Harley? No! I’m trying to focus on things that are more important than material stuff. Like relationships, personal growth, simple experiences and pleasures. Like a bike ride in the cool morning air from one end to the other and back in Pt. Pelee National Park. And watching the sunset. Priceless!

#79 cynically on 07.17.15 at 8:57 pm

Jordan2 — your first two suggestions are “right on” then add an elected Senate with less members and a Canadian head-of- state and we will be on the road to a much more sound democracy but still with a little more tweaking to do

#80 weedeater on 07.17.15 at 8:59 pm

LOL pic today Garth. Thank you. I needed that.
Anyone who believes that not being all-in Canada means being pro-American doesn’t grasp the reality of today’s global market. We’re talking about investing here, not patriotism. No loss. Keep being you.

#81 Rural Rick on 07.17.15 at 9:01 pm

If Canada is going to ever get off it’s butt it has to heave Steve and get Monclair to build nuclear reactors for power. Never happen. Hewers of wood drawers of water.

#82 45north on 07.17.15 at 9:02 pm

But I will not read your blog anymore with all your pro US and anti Canadian hyperbole. If you love them so much then GTFO.

people now read whatever blog they want. They choose ones which re-enforce their beliefs. Easy to do – just click and you’re at a new blog. There was a time when to change TV channels you had to get up and turn the dial on the TV.

I see a time when attachment to a set of beliefs is so strong that when that set of beliefs is disproven then the believers die.

#83 Washed Up Lawyer on 07.17.15 at 9:15 pm

If anyone has the temerity to call Fort McMurray Podunk Hollow I will throw a hard left hook.

Aerosmith plays the CNOOC/Nexen stage at Shell Place on Sunday.

Hope Steven Tyler does not go all Neil Young on us because of the CNOOC/Nexen pipeline spill.

He would not make it out of town to his next date in Moose Jaw.

#84 Balmuto on 07.17.15 at 9:16 pm

#34 Mark
“Sure looks to me like investors are piling into the trade for either deflation or further BoC policy action.”

I don’t know about deflation, but the CAD bond market is certainly pricing in low inflation and low rates for a long time. Right now the CAD 30 yr is yielding less than the core inflation rate. That’s simply unsustainable. Either inflation will grind lower or yields will start to drift higher if it doesn’t. I predict the latter, for two reasons:

1) I don’t think commodity weakness will be short-lived. With the recent capitulation in oil prices and the collapse in the Chinese stock market I think it’s unlikely we’re going see a quick recovery. And that means a weak CAD just as assuredly as it means a weak AUD, NZD and BRL.

2) that in turn means that inflation will have support from higher import prices, since so much of what we buy is priced in USD. Which will hamper the BOC’s ability to apply more stimulus. And that realization alone will cause bond yields to come off these lows, even if the economic outlook remains bleak.

I might be wrong about #2. Don’t think I’ll be wrong about #1.

#85 Nagraj on 07.17.15 at 9:19 pm

AHA!!!

“Form 2106. Employee Business Expenses. Use this form if you are an employee deducting … irs.gov/uac”

2106: LADA engine number (years ago my dad bought a Lada out of spite)

ANGEL NUMBER 2106 “encourages you to ask the angels for help with something that has been concerning and/or irritating you … ”

Also: “Serbia prepare for Euro 2106 clash with Portugal”

NASA: Total solar eclipse May 3, 2106
Good to know, eh?

And then there’s . . .

#86 fearofmanandgod on 07.17.15 at 9:24 pm

http://www.thestar.com/

“What are Canadians are most scared of?”

Did Smoking Man-dude land a job with the Star….just asking?

#87 Smoking Man on 07.17.15 at 9:25 pm

How to spot a troll-bot.

It’s been one year since Ukraine shot down MH17. No report, no ATC tapes. No sharing of info. Top secret investigation, where all parties have Vito rights..

Cover up people…

Just alot of quite, as I predicted last year. Today Rupert Murdoch’s Zio pump enterprise realese a video, showing Ukrainians Russia freedom fighters ransacking back packs shortly after the crash.. On the adversary.

How convenient, total demonization of men resisting Nazis shelling their towns.

On Twitter, unlike when it happened last year there are zillions of twits posting anti Russia.

Now if a real person is posting, click on there name. They will talk about all kinds of shit..

A Troll-bit sticks to one topic, never deviating, both sides have em..

Info wars..

Thank God, we have this blog to share and exchange theories.

No bots allowed in here..

#88 maplines on 07.17.15 at 9:29 pm

“By the way, I love my country.-Garth”

Garth, while seemingly harmless and noble, be wary of being sucked into the nationalist camp just to score brownie points. The nation state itself is a recent social construct, so it is actually a bit counter-intuitive for a human to be attached to a land mass with arbitrarily lines drawn by politicians on a map….just ask the people of the Middle East, West Africa, of the former Yugoslavia……not to mention the dangers of extreme nationalism such as in Germany/Japan of WW2…..you seem better suited to be a global citizen. Or if you like, we can sign you up to be an interplanetary one and ship you off on the next mission to Pluto. Just be careful not to slip on the ice, given your history of mishaps.

#89 Washed Up Lawyer on 07.17.15 at 9:31 pm

Sorry, you could not see me signal in the air with my fingers. That should have read “Podunk Hollow”.

My liberal arts degree ain’t worth much, so Garth gives me a C-.

#90 maplines on 07.17.15 at 9:33 pm

“The one-year return for Toronto stocks is negative, at -1%. In contrast, the 12-month return for the Dow is 9% and the S&P has increased 10.8%. The Nasdaq is ahead 21% year/year while being up almost 11% so far in 2015. And it’s only July.” Garth

Garth,

how do you pick the start-end points for these year/year comparisons. I am a bit leery of these, as people often pick the low point the previous year, or some other unreasonable starting point…lies, damn lies and statistics!

Year/year is exactly what it means. A 12-month return from and to the same calendar date. — Garth

#91 Godth on 07.17.15 at 9:37 pm

#87 maplines on 07.17.15 at 9:29 pm
old news…
https://www.youtube.com/watch?v=RTOQUnvI3CA

#92 Sosuke Aizen on 07.17.15 at 9:39 pm

#34 Mark:
Do not include $ with CAD, because the D stands for dollar (write CAD or CA$). Similarly, do not include $ with USD (write USD or US$).

Do not write “Canadian GoC bond.” It is redundant to call Government of Canada bonds Canadian. Write Govt of Canada bonds or Canada bonds.

Or, stop writing. — Garth

#93 OttawaMike on 07.17.15 at 9:41 pm

#82 Washed Up Lawyer on 07.17.15 at 9:15 pm

I hope Nexen/CNOC builds better stages than pipelines.

They couldn’t be troubled installing a failsafe interstitial monitoring system on that double walled pipe? Or at least test the damn thing properly?

I thought Steve Tyler was
dead

#94 Smoking Man on 07.17.15 at 9:43 pm

Garth you sound like The American more and more. I am open to another man’s opinion. But I will not read your blog anymore with all your pro US and anti Canadian hyperbole. If you love them so much then GTFO.

……..

Guys an idiot, he’s going to miss all my amazing, Nectonite, UCC calls.

#95 retired Boomer - WI on 07.17.15 at 9:45 pm

#88 & #82 Washed Up Lawyer

Jingoism error?

#96 Leo Trollstoy on 07.17.15 at 9:45 pm

#74 BS

Mark needs to stop burning his money. Thankfully the CAD that he’s burning is worth less and less each passing month.

#97 Eats, shoots, and leafs on 07.17.15 at 9:47 pm

Garth

Forget living large on the lettuce and start to encourage the locals to econo-forage in these tough times.

http://montrealgazette.com/life/food/wild-edibles-chefs-forage-in-the-country-and-the-city-for-hundreds-of-delicious-plants-and-berries

Okay, okay, maybe a bit tough in winter, but could it be time to follow the grizzlies and hibernate for 6 months…

#98 David on 07.17.15 at 9:48 pm

@14 Vancouver Troy

There are several: CPD, XPF, ZPR, HPR. The first two are from iShares. The latter two are from BMO and Horizons. They all contain rate-resets but in different proportions. CPD has a lot of straight perpetuals which are the most sensitive to rising interest rates. Garth seems partial to XPF which offers the benefit of US exposure and greater diversification.

Just don’t forget this is free information from someone you don’t know who makes no claims to be a financial advisor.

#99 Leo Trollstoy on 07.17.15 at 9:49 pm

#83 Balmuto

For what it’s worth, I think that your reasoning is sound.

And financially speaking, I hope it’s spot on.

#100 Leo Trollstoy on 07.17.15 at 9:50 pm

Or, stop writing. — Garth

Ouch. That was cold.

#101 Herb on 07.17.15 at 9:53 pm

#82/88 Washed Up Lawyer,

“Fort McMurray” sounds military and tough, but “Podunk Hallow” sounds so proper and fitting …

#102 Ted 2 on 07.17.15 at 9:54 pm

#75 Meek and Mild on 07.17.15 at 8:47 pm
Go ahead and laugh at me. I am really scared. I don’t like storms, especially of the economic variety. ”

Sounds like you need a thunder buddy, or an econ-thunder buddy…grow a set would ya…

#103 Harry Wilson on 07.17.15 at 9:56 pm

I’ve been waiting for the right post to ask this question, and #11 Andrew beat me to it. I’ll ask anyway.

Since Mr. Turner refuses to manage my personal wealth (currently an even split between CAD and bottles & cans), I’ve been trying to cobble together a practice portfolio on my own. The one question that I keep asking myself is whether there is an advantage in holding any Canadian equity at all.

If a Canadian component is not important for someone in Uruguay, Uganda, or Uzbekistan, why is it important for us? Is it only patriotism, or is there an unemotional reason behind it? I’m all for patriotism, but some days I can’t help feeling like a Nortel employee putting their savings into Nortel stock.

———————————————————

P.S. Mr. Turner, a lot of folks are suggesting you run again, but you’ve been there, done that, and likely still have the t-shirt. On the other hand, assuming a regime change, how do you like the sound of ‘Garth Turner, Governor of the Bank of Canada’?

#104 lee on 07.17.15 at 9:56 pm

Fitch says Toronto has nothing to worry about. So people, stop dreaming of a skinny Mcmansion at Eglinton and Oriole Parkway for $750,000. It ain’t gonna happen, no matter how long you read this blog.

#105 BS on 07.17.15 at 9:57 pm

Loblaw’s and the Weston family built their fortune in Canada but see no problem manufacturing all their goods in third world countries.

Loblaw’s and other retailers are just providing what the consumer demands. If Loblaw’s offered goods produced in Canada at a higher cost people wouldn’t buy them. The consumer would shop where cheaper foreign goods were available and Loblaw’s would go bankrupt. You can buy more local goods at smaller retailers if you are willing to pay double and triple the price. Most people aren’t so retailers are dominated by those selling foreign produced goods. Ultimately it is the consumer who makes the decision on where goods are produced and what goods are offered for sale, not the retailer.

#106 A penny for your drops on 07.17.15 at 10:00 pm

#64 Republic_of_Western_Canada on 07.17.15 at 8:22 pm
#8 canuck in socal on 07.17.15 at 6:27 pm

How’s that water shortage working out for ya?”

What’s even scarier is that there is severe water rationing on Vancouver Island and the lower BC mainland, 2 of the wettest places east of Papua New Guinea..best not gloat too much there, partner!

#107 ANON on 07.17.15 at 10:04 pm

#75 Meek and Mild on 07.17.15 at 8:47 pm
Go ahead and laugh at me. I am really scared.

And it would take a complete loss of touch with reality not to be. You are perfectly normal, friend, same as the abhorred (for good reason) storms are normal, same as the greedy world we are all part of is also normal, and we have all benefited from this greed, some more than the others (arguably more over here).
Welcome to life*.

*Warning: will contain the flip side, if acquired later into the expansion.

#108 cmj6662 on 07.17.15 at 10:08 pm

#14 Vancouver Troy
The specific ETF for 5 year laddered preferred is a reset and is from BMO -ZPR. It is at a good price right now with about 5% return.

#109 Godth on 07.17.15 at 10:17 pm

#86 Smoking Man on 07.17.15 at 9:25 pm

Shut up you damn commie conspirator! Everybody knows who the bad guys are and it’s not us. We have fair play, objective analysis and white hats you damn traitor!
https://www.youtube.com/watch?v=eVqj3adOIwg

#110 Smoking Man on 07.17.15 at 10:31 pm

Key word.. Population growth.

Fitch.. Boy these dudes flip flop. Must be a Smoking Man fan.

Look what they say about Toronto and Vancouver..

My advice, fire your entire research department and follow the smoking man on greater Fool.

……………

The Bank of Canada’s 25 basis point rate cut this week shouldn’t have much impact on mortgage rates, Fitch Ratings announced on Friday, but it does bolster the credit-rating agency’s view that the Canadian economy is weak and the country’s overvalued housing market faces a risk of decline.

“Given the current rate environment, which has been at near-record lows for several years,” New York-based Fitch does not expect the rate cut to have much impact on mortgage rates or affordability for current borrowers, the agency says in a research note published Friday.

However, Fitch continues to view the Canadian housing market as overvalued by approximately 20% on a national basis, with modest variation between provinces. Furthermore, some regional markets are already showing signs of weakness, the Fitch research note says.

“In Alberta, where low energy prices have been placing downward pressure on the economy, prices have been volatile,” the Fitch research note says, noting that prices in Calgary are down by approximately 3% since October 2014, according to data from Teranet.

At the same time, Toronto and Vancouver are continuing to set new home price records, the Fitch research note says, and these markets are less likely to fall as they are “being supported by stronger economies and population growth.”
Overall, Fitch continues to expect a soft landing, nationally, where the price growth will ease, followed by modest declines. Significant downturns remain unlikely, but downside risks do exist, particularly in markets that have been dependent on robust construction and real estate activity in recent years, the Fitch research note says.

#111 Smoking Man on 07.17.15 at 10:40 pm

For those of you that think the low dollar hurts us, crap, if Greece had one they would get out of the mess they are in.

Your a Canadian Bank. TD, Royal, BMO, CIBC, Scotia with operations in NYC.

I Can with certainty tell you, that these bastards are looking at bringing allot of jobs back to Toronto. 30% savings, managers looking at bounce, upper managers looking at giving share holders a penny more on dividend and adding a few million to their bouns.

Bank Jobs pay well, as long as your not handing a note to a teller.

Bungs in long branch, 1 million next year.

#112 Leo Trollstoy on 07.17.15 at 10:43 pm

#103 Lee

Toronto real estate prices have been on an insane and unsustainable price rise for years. Who knows when this insanity will end.

#113 Bottoms_Up on 07.17.15 at 10:49 pm

He loves this country, and was also 1 or 2 steps from being PM.

#114 Leo Trollstoy on 07.17.15 at 11:00 pm

Alberta is getting hit by falling oil prices and now inflation.

http://calgaryherald.com/business/local-business/albertas-inflation-rate-among-highest-in-canada

#115 John Prine on 07.17.15 at 11:11 pm

#1 ShawnG in TO on 07.17.15 at 6:12 pm
wow, i thought blog dogs here are smart (except realturds, of course). i have to admit i was wrong.

Lots of smart, honest, hard working realtors out there along with the slimers that are in every profession. I would not be a realtor as I couldn’t deal with all the cheap vendors and flakey buyers they deal with every day. Give it a rest…….

#116 Karma on 07.17.15 at 11:26 pm

#15 Goldie on 07.17.15 at 6:34 pm
“Open rebuke is better than love carefully concealed.

If one loves one’s country truly then one should be compelled to point out when it’s being run poorly.

NOT caring about one’s country would be telling people that the country is doing great even when one knows that this not true, just to avoid hurt feelings.”

Totally agree! Same for friends and family. If you love them, don’t lie to them!

#117 Scumop on 07.17.15 at 11:31 pm

If “we” can get the Canadian dollar low enough in this “1% raises” economic system, our labor rates will be comparable to China and India.

This his how we will re-enter the world stage as a nation that makes things instead of one that sells off the furniture (resources).

Its going to be a struggle, but I believe Harper and Co are up to the task.

#118 Karma on 07.17.15 at 11:32 pm

#19 Broke Dick on 07.17.15 at 6:40 pm
“One last thing.
Garth,you sound as if you are the leader of the opposition.
For every move the government makes you take the opposing view point.”

At the moment, there are millions of Canadians that fit the bill of being “Leader of the opposition” because they take the opposing view point of anything the Harper government does.

In other words, it’s time for a change.

#119 Has anyone seen this? on 07.17.15 at 11:32 pm

http://www.pensiontsunami.com/

(Canada has the same problems)

#120 Smoking Man on 07.17.15 at 11:40 pm

#108 Godth on 07.17.15 at 10:17 pm
#86 Smoking Man on 07.17.15 at 9:25 pm

Shut up you damn commie conspirator! Everybody knows who the bad guys are and it’s not us. We have fair play, objective analysis and white hats you damn traitor!
https://www.youtube.com/watch?v=eVqj3adOIwg

…..

Starting to like you, can you just go with Th the God part frightened me. Visions of Ala Akbar Boom.
Wierd men who have the keys to the cock pit bowing and chanting crazy shit at a wall in Jerusalem Freek me out.

Just go with Th…

#121 Coho on 07.17.15 at 11:42 pm

If we are living beyond our means, then could we even find the words to describe the means by which those atop the wealth pyramid live?

One person per family working a 40 hour week used to earn a middle class lifestyle for the family. Now, even with two incomes, expecting to afford a middle class existence is much to ask, it seems. Most people just want to be left alone to pursue a decent life for themselves and their families. They have simple tastes and don’t ask for much, although TPTB would disagree. Unlike average people having basic wants and needs, the parasites sucking the people and nations dry have very expensive wants and ‘needs’ along with an intense desire to control others, which takes money — lots and lots of money. It’s never enough, really. In their quest for the entire pie of earthly wealth and power, they’re eyeballing even the crumbs that were previously are left for average people. Now, they want them too.

Questions have been raised and circulated by agents of TPTB whether or not the ‘unwashed masses’ are entitled to ANYTHING AT ALL. Basic human rights and needs are under attack. The TPTB by way of their monarchies, governments, banks and corporations, in other words, entities, many of which have been used as strong arms, want:

Our money — ALL OF IT
Our rights and freedoms — ALL OF THEM (whatever is left to take)
Our power to influence our future — ALL OF IT

They want us to give up:

Self-empowerment — ALL OF IT
Our hopes and dreams — ALL OF THEM
Our spirituality — ALL OF IT
Our dignity — ALL OF IT

And perhaps most importantly, our will to retain the best part of ourselves as human beings.

Things are getting to the point where people will be forced to make an important choice very soon. All pretense and appearances will drop and where our allegiance is will be exposed. Each of us as individuals will choose to either be on the right side of the system, which has turned against the populace, or on the right side of humanity.

One of the Founding Fathers warned against what is happening today. This was over 200 years ago, yet many people living today are completely blind to what is happening, or support and promote it.

Thomas Jefferson
Quotation: “If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their Fathers conquered…I believe that banking institutions are more dangerous to our liberties than standing armies… The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.”

#122 kommykim on 07.18.15 at 12:29 am

RE: #14 Vancouver Troy on 07.17.15 at 6:31 pm
How does one buy rate-reset preferreds? Is there an ETF holding them?

ZPR on the TSX.

#123 Nagraj on 07.18.15 at 12:44 am

“By the way, I love my country.”

So do I. So does Harpo. So does Wynne. Etc.

Patriotism in public life is a given. American politicians have become skilled in deflecting jingoistic charges of being unpatriotic. In Canada there’s a preference for understated patriotism – even charges of UNCANADIAN are practically unheard of.

[I myself think of Harper’s foreign policy as UNCANADIAN vs Pearson’s, for example.]

Personal demonstrative expressions of nationalism make me uncomfortable. There is absolutely nothing UNCANADIAN about advocating a greater weighting in US stocks. There’s really no need to dignify that charge with a response.

And I have a lot of fun twitting overly enthusiastic flag wavers –

#124 anotherstabbinginsaskatoon on 07.18.15 at 12:46 am

We need to bomb the states. Bomb them back into the stone age. Master P Ghetto D is SOLID.

#125 Frank on 07.18.15 at 12:54 am

So is Canada cheap yet?

#126 The real Kip on 07.18.15 at 1:08 am

“It’s also not betraying our national ugly aquatic rodent”

Now you’ve gone too far Garth. Bad mouthing the Canadian Beaver? Our national ambassador? I think he’s beautiful. Hardly an ugly aquatic rodent!

#127 kommykim on 07.18.15 at 1:19 am

RE: #62 David on 07.17.15 at 8:21 pm
I don’t like paying the 15 percent withholding tax on US stocks.

You need not pay any tax. Buy in C$. — Garth

He’ll still lose the withholding taxes if he uses an ETF like VUN, in a TFSA or RRSP. But it’s only 15% of a 1.5% dividend yield so no biggie. He could recover the tax if he held VUN in a taxable account, but then he’d be subject to foreign income tax rates and future capital gains.

#128 VanMan on 07.18.15 at 1:31 am

And…let’s not forget, that Cascadia quake on the west coast is expected to cause approx. $75+ billion in losses. That’s over 5% of national GDP. Anything over 2% is likely to cause a national recession… and we know it’s coming at some point. Better spread the risk

http://vancouver.ca/files/cov/Earthquake-Preparedness-Strategy-20131203.pdf

#129 Mark on 07.18.15 at 2:42 am

“Mark needs to stop burning his money. Thankfully the CAD that he’s burning is worth less and less each passing month.”

At least I’m not holding declining real estate like you are (although I understand you delude that Toronto prices are going higher!). Unless you were smart enough to sell out a couple years ago, which for some reason I doubt highly.

#130 Freedom First on 07.18.15 at 2:51 am

Yes. No soft landing for Canada. We are not different. Denial will not help you.

#131 TRT on 07.18.15 at 4:12 am

Based on the facts, I can’t wait until things get much worse economically in Canada.

Unless you’ve works with sociopaths and psychopaths , you will never appreciate how likeminded the people who run out country are.

The only thing worse than evil men are good ones who stand by and do nothing. Do something this election. Don’t split the vote.

#132 Balamut on 07.18.15 at 7:53 am

I don’t get it… BoC is destroying the CAD to sustain the manufacturers by having competitive prices… Aaand by that mr Harper could be reelected cause in the meantime the housing bubble will be kept intact and people (maybe) will get jobs by having the economy “boosted” with lower rates… My first question is: what are those people smoking? Second is: do they really think that by increasing the inflation, will make the population happy and ready to vote for them? Although the canadians are sinking now in debt… And cutting the income by increasing the inflation is less painful (probably less visible) than losing 30% of your house price in one year…

#133 Llewelyn on 07.18.15 at 8:03 am

To #BS 104

Oh Gee I never thought of that. Boy you really have become drunk on the capitalist kool-aid. We will have to move to the Third world to survive in this dog eat dog world unless!!!

Here is an interesting concept to consider!! Bargain seeking Canadian consumers need employment to continue buying the cheap stuff being made by employed workers in other countries.

Governments around the world are using taxes collected from their citizens to bribe companies to locate within, or stay within, their political boundaries. When bribes don’t work government lowers corporate taxes in the hope that increased profits will be invested to create additional employment that can be taxed to attract more companies. Great theory for the capitalists but is this theory working for Canada?

When I examined actual employment statistics since 2009 I determined that government not corporate Canada was the primary source of new employment opportunities.

When Alberta was extracted from the employment picture over 85% of the net gains in employment for the rest of Canada over the last ten years required substantial subsidies from government sources. Sure lots of jobs were created in the food, hospitality and retail sectors but these gains were offset by losses in other sectors.

The only way an illogical circle based on government subsidiies to create employment that can be taxed to create more government supported employment is by incurring additional debt.

I am sure I don’t have to remind you that total debt assumed by our governments since 2008 goes well beyond irresponsible since it preys on the quality of life of future generations.

Take a few moments to consider what will happen when the ability of our governments to keep the circle of debt afloat ends? As it most definitely will.

Here is a hint it rhymes with Fleece. Sheeples indeed!!!

#134 SWL1976 on 07.18.15 at 8:25 am

#120 Coho – Big +1 for that post.

I see you clearly see what is going on and the direction we are going.

We are all going to face some tough choices in the coming future where one will have to ask ones self…

Which side do I want to be on?

#135 maxx on 07.18.15 at 8:27 am

“Six years after the GFC our dollar is at the same abysmal level, our trade deficit has rocketed higher, provinces and households are swimming in loans, we’ve added $200 billion to the national debt, and the central bank this week was forced to slash interest rates because of a recession.”

A result like this in the private sector would result in those responsible being handed their hats.

#136 maxx on 07.18.15 at 8:38 am

“By the way, I love my country.

Why else would I do this every day?”

Most on this blog never doubted it. You are exactly what Canada needs.
Unfortunately, we are currently awash in corporate-helmet coiffed buffoons.
Perhaps those helmets are too tight.

#137 Bottoms_Up on 07.18.15 at 9:02 am

#34 Mark on 07.17.15 at 7:05 pm
———————————
Please explain how you read deflation from positive interest numbers?

#138 maxx on 07.18.15 at 9:29 am

#44 Boris Stellov on 07.17.15 at 7:33 pm

Very smart. Very young…and on track to becoming a millionaire, and then some. You’re an inspiration to many.
Bravo!

#139 Spectacle on 07.18.15 at 10:40 am

Regarding ::

“#110 Smoking Man on 07.17.15 at 10:40 pm
For those of you that think the low dollar hurts us, crap, if Greece had one they would get out of the mess they are in.

Your a Canadian Bank. TD, Royal, BMO, CIBC, Scotia with operations in NYC.

I Can with certainty tell you, that these bastards are looking at bringing allot of jobs back to Toronto. 30% savings, managers looking at bounce,…………

Bank Jobs pay well, …”
——————-
1) I can understand the economic strategy you outline. The low level jobs are being replaced with Temporary Foreign Workers, exactly the same as Tim Hortons. Exactly.
2) The middle logistics & call centers have been outsourced to offshore companies years ago.

– What’s your take that moving an upper department management office that makes the biggest bucks, just to save on wages, isn’t really likely?

I’d love to see Canada bring back Career Wage paying companies! With our economics/politics…..fugetaboutit??
Regards,

#140 joblo on 07.18.15 at 11:15 am

“By the way, I love my country.” – Garth

Of course anyone over 50 has never had it so good.
Now for the under AARP/ CARP crowd, (including Tigger Woodz), let’s see if they feel the love over the next 20 years.

If they stick around they get to clean the mess of a commodity based economy, outdated business models, maturing industries, ham fisted inept leadership, lack of innovation, expensive socialist programs, bankrupt government etc. I got nothin, except not Feelin it Garth.

#141 Karma on 07.18.15 at 11:28 am

This guy makes many of the points blog dogs complain about with regard to housing in Canada.

It’s good that this point of view is becoming more mainstream (ironic, eh?).

“Vancouver is Mortgaging its Future for a Market that is Anything But Free”

http://www.theglobeandmail.com/report-on-business/rob-commentary/vancouver-is-mortgaging-its-future-for-a-market-thats-anything-but-free/article25558615/

“Vancouver’s housing crisis has been directly caused by government policy, and now that an entire generation has been priced out of the market…” While it is fashionable, and facile, to believe this meme, it’s not true. All generations are priced out of a market where greed and speculation have been popularized. Stop feeling sorry for yourself and call out the real culprits. Hint: they are not foreigners. — Garth

#142 Balmuto on 07.18.15 at 11:42 am

#113 Leo Trollstoy

“Alberta is getting hit by falling oil prices and now inflation.”

Well there you go. It makes no sense for inflation to be picking up there unless it’s cost-push driven; likely due to the weaker CAD. And that’s a bad situation to be in.

#143 kothar on 07.18.15 at 11:55 am

Since the theme late is value of our currency…One thing I have questioned. Say I bought 10000 in usd when was at par….I kept that until yesterday and then brought to bank exchange is like 1.27 back so $12700 cad. Would I have to de late the $2 700 as profit on my income tax or is forex gain loss exempt ?

#144 Karma on 07.18.15 at 11:58 am

“Vancouver’s housing crisis has been directly caused by government policy, and now that an entire generation has been priced out of the market…” While it is fashionable, and facile, to believe this meme, it’s not true. All generations are priced out of a market where greed and speculation have been popularized. Stop feeling sorry for yourself and call out the real culprits. Hint: they are not foreigners. — Garth

——————————————-

Garth, with all due respect, government policy has been a big culprit of the problems of Vancouver. I’m sure you read about the Fraser Institute’s report on Development Charges (DC) municipalities levy against developers. I’m not saying there shouldn’t be DCs, but having $37k on average per unit is a bit excessive. This obviously drives up costs for purchasers of condos and apartment buildings. In Burnaby, it’s $17k on average. If the City of Vancouver wasn’t so greedy, those savings could have been passed on to the purchasers for well over a decade! Therefore, compounding of price increases wouldn’t have been as excessive in Vancouver.

Secondly, it is asinine to deny that foreign capital (not necessarily foreigners, as these aren’t the same things) doesn’t play a role. I know many, many people from high school and university who grew up in satellite families (i.e. Dad in Asia, mum and kids in Van). I’m just sayin’, ain’t no way single mother of 3, who doesn’t work, can afford a 4,000 sq ft house in Burnaby in 1995 (forget about today’s prices!).

Thirdly, there are approximately 100,000 foreign students in BC (including just for learning English), with vast majority in Vancouver. Their lives are sustained 100% by foreign capital coming into the province. And this isn’t necessarily Asian capital. Lots of Yanks and some Europeans study in Van too. That said, they aren’t buying houses. They are renters, which is very important in investors believing that they’ll always have someone to rent to (which is not actually the case). Therefore, amateur landlords are more likely to take a punt on a shitty 3-4% cap rate investment in a condo, all the while thinking they’re making a lot of money (which they aren’t, and certainly don’t know how the accounting is done to properly measure performance).

I’m very much with you in the idea that locals are the main culprits in driving up house price. But as in all dynamic situations, it’s never one culprit, rather a number of things converging to cause the problems.

#145 Herb on 07.18.15 at 12:13 pm

Garth,

“greed and speculation” may be the motives, but they did not provide the means to inflate or keep the RE gas bag going. That took/takes low down payments, low interest rates, long amortization periods – and the elimination of risk by CMHC guarantees.

Those means are fashioned by government policy, not greed and speculation, no matter how popular.

#146 Vundo on 07.18.15 at 12:20 pm

Anyone remember this guy?http://www.cbc.ca/news/business/bank-of-canada-rate-cut-will-lure-canadians-deeper-into-debt-say-experts-1.3154931

I am at a loss for words.

#147 Water Shortage on 07.18.15 at 12:42 pm

I wouldn’t mock the SoCal people a drought is terrible and we think we are immune read what’s happening in western Canada parkland county, Leduc by Edmonton have declared agricultural state of emergency in Saskatchewan some places are drier than the 30’s what do you think this will do to food costs! so our worthless dollar just became even more worthless! So idiots can buy their big houses with big expenses and then whine about how they have to go to the food bank!

#148 Bob Santarossa on 07.18.15 at 12:42 pm

Vis-à-vis your detractor, you will have the last laugh Garth.

Next report job numbers will be bad and slightly negative/positive GDP. Job numbers will be hideous in September and October reports with a very negative GDP – my guess.

If all that happens, you will be a prophet but really? You are using simple and common/public domain economic indicators to make your case.

Your detractors are those that will be in trouble if what you say comes true.

I am 60 – came to the same conclusions as you do and did something about it (live in YVR – sold condo, investments in mutuals with strong international component). Figured that out before reading you Blog (i.e., came to the same conclusions as you by myself).

And yes Garth, TFSA topped out and will slowly transfer funds to TFSA from my RRSPs. In the meantime, use minimum RRSP amounts over the next 4 years to zero my income taxes and continue to put maximum cash in TFSAs, I just retired. Handy with Excel, years ago created a model to do my tax calculations in it and using Goal Seek, I can calculate the minimum RRSP investment to zero my income tax (i.e., get all the income taxes back). Still irks me they make deductions as source (i.e., they have my money for year and after filing, I get it all back).

Polonius had it right for what is to come in Canada: “Neither a borrower nor a lender be”.

#149 BS on 07.18.15 at 12:50 pm

“Vancouver’s housing crisis has been directly caused by government policy, and now that an entire generation has been priced out of the market…”

If everyone is “priced out” guess what happens to the price? It goes down to the point where people are no longer priced out.

#150 TRT on 07.18.15 at 12:53 pm

Garth, delete Mark. He is a troll.

#151 just sayin' on 07.18.15 at 12:54 pm

The walls are closing in on the HAM Deniers

http://www.vancouversun.com/opinion/columnists/offshore+real+estate+data+staring+face+this+time/11223346/story.html

Politically correct or not…this issue has been very bad for Canada

#152 BS on 07.18.15 at 12:56 pm

Bargain seeking Canadian consumers need employment to continue buying the cheap stuff being made by employed workers in other countries.

Yup, and those same people are working at Walmart. Then they complain they don’t make enough money, at the same time only shop where prices are the lowest. It is not the 1% buying the junk in Walmart.

#153 dosouth on 07.18.15 at 12:58 pm

…The banks are under no obligation to do this, and if they did, savers would making 0%. Why? So you borrow for less? — Garth

———————————-

Yes, and use their money for a change.

#154 jess on 07.18.15 at 1:19 pm

rate booster schemes – artificial tax avoidance.

artificial structure involving a chain of dividends. – See more at:
https://www.gov.uk/government/news/clothing-giant-next-loses-tax-avoidance-case
https://www.accountancylive.com/po-loses-%C2%A314m-double-tax-relief-rate-booster-case#sthash.3hKlBeZ0.dpuf

“A staggering £130m in taxes are involved over 20 rate-booster cases. There are also several instances where companies decided to avoid going to court and simply conceded. These latter cases alone generated some £500m in taxes.”

http://www.calculator.co.uk/2015/07/next-gets-a-22-4m-tax-bill-after-losing-avoidance-case/
=======
Dodd-Frank’s Section 1504
Why Section 1504 ? perhaps the resources of this country would have not been spent by the manboy playing king
http://www.dailymail.co.uk/news/article-2791862/african-dictator-s-playboy-son-forced-surrender-30million-assets-impoverished-people-country-michael-jackson-s-crystal-glove.html
contrast and compare
https://www.cia.gov/library/publications/the-world-factbook/geos/ek.html

https://firstlook.org/theintercept/2015/07/16/dodd-frank-anti-corruption-rule-stalled/

#155 sunmonkey on 07.18.15 at 1:29 pm

#111 Leo Trollstoy

Yes it has been pretty insane. Houses bought in 2009 for 400k are selling in 2015 for 700k. The price appreciation is 75% in 6 years. This is absolutely nuts.

This is based on sold history reports that I am receiving from our agent on homes that we have been interested in.

Where? — Garth

#156 Has anyone seen this? on 07.18.15 at 2:23 pm

http://dailycaller.com/2015/07/17/satellites-earth-is-nearly-in-its-21st-year-without-global-warming/

(second biggest scam next to the print money out of nothing and charge interest money system)

#157 devore on 07.18.15 at 2:29 pm

#21 bb

2 years ago if my memory serves me right CAD was trading at 0.99 to 1 for 1USD. Friends told me to sell all my USD

Your friends were idiots, like most amateur investors. Why would you load up on something that is at or near it’s historic high? Too much Zerohedge and too much thinking with their pants.

When dollar was over par, I was buying US assets in my portfolio, like all smart people. Garth was posting about it every other day. That was a no brainer, easiest 25% I ever made. Also made travelling much cheaper. Ah, the good days.

#158 OXI in GREECE !! on 07.18.15 at 3:00 pm

#147 BS on 07.18.15 at 12:50 pm
“Vancouver’s housing crisis has been directly caused by government policy, and now that an entire generation has been priced out of the market…”

If everyone is “priced out” guess what happens to the price? It goes down to the point where people are no longer priced out.

<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<

Not if a large part of Vancouver is owned by foreigners. Did you read that article?

"Once upon a time, the government did track foreign ownership.

Under the Land Title Act, enacted in 1978, the province required a Statement of Citizenship from the new owner of every transaction in B.C., which included a declaration of the citizenship of the buyers and/or directors involved.

It was repealed in 1998, according to the finance ministry, “to reduce red tape and cut the cost of doing business in B.C.”

Odd, isn’t it, that a simple statement of citizenship would be considered so onerous to “the cost of doing business in B.C.” that it had to be repealed?

It’s odder still considering that there still exists an example of the provincial government asking for proof of citizenship in a real estate matter."

wow…..

We are told repeatedly that there are no "facts" because Govt conveniently "removed" the facts from view. So now the only facts are the hundreds and hundreds of people that post to blogs like this with "horses mouth evidence" that foreigners just bought the house beside them and all the houses on that block. But of course, that type of evidence does not count in our "democracy of checks and balances".

Property purchases by non-Canadian residents could be outlawed tomorrow and there would be zero impact on YVR prices. If 5% downpayments became 10%, the impact would be immediate. So obsess about something that actually matters. — Garth

#159 devore on 07.18.15 at 3:23 pm

#81 45north

I see a time when attachment to a set of beliefs is so strong that when that set of beliefs is disproven then the believers die.

That’s not how deeply held beliefs work. Simply challenging them, even with irrefutable, scientifically proven fact does not work, it simply re-inforces those beliefs. It is up to the individual to discover information, and make his own decision to deprogram himself. The internet makes both sides of the equation easier. Yes, there is more information available, and it’s easy to find and access, but also communities, however tiny and eccentric now have global reach. It is trivial to find a support group to just echo chamber your beliefs. As much as internet’s ubiquity and instant reach helps bring people together, it also keeps us apart. Unless we’re willing to go the extra mile.

#160 OXI in GREECE !! on 07.18.15 at 3:28 pm

Property purchases by non-Canadian residents could be outlawed tomorrow and there would be zero impact on YVR prices. If 5% downpayments became 10%, the impact would be immediate. So obsess about something that actually matters. — Garth

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

And what about most of the foreigners that are putting down a 100% down payment? And please tell us how affordability in our own country does not matter?

Inconsequential to prices overall. — Garth

#161 yeg_guy on 07.18.15 at 3:29 pm

This will not end well …

From Edmonton Journal today.

Rajan and Navreet Sharma are keenly aware of the pros and cons of buying, selling or renting a home in Edmonton, especially at a time when Alberta’s energy-fired economy is sputtering.

That’s because they’re currently doing all three.

The Sharmas just moved into a new 2,300-square foot detached home they bought in southeast Edmonton for $538,000, while their former home, a duplex unit that’s listed at $399,000, remains on the market.

The young couple — he’s a civil servant with the province and she’s a newly minted chartered accountant — also own rental properties in the city, where the vacancy rate is inching up as the inflow of newcomers slows.

http://tinyurl.com/qxy2trc

#162 devore on 07.18.15 at 3:39 pm

#104 BS

People who believe corporations and evil and just out to screw them will never understand this. A business provides what the customer wants, and they always look to expand their market (at varying speeds and aggressiveness). Most people buy most items based on price. Period. Disregard anything people say, and watch what they do. Price is the only thing that matters most of the time. If quality, or country of origin, or ethics, or environmental impact/sustainability mattered, businesses would cater to it. But it does not, so they do not.

A business that does not provide what its customers demand (with their wallets) goes out of business. If you are concerned about things other than price, there are still producers and retails who cater to you, but as the demand and market is small, they are not as convenient, and you will also pay much more.

Seriously, if these people think there is so much money to be made from selling Canadian made goods, they should open their own stores. But they will not, because it is much easier to demand others change to fit into this fantasy world of theirs. And then punish them by spending their money in stores that sell cheaper goods.

#163 Balmuto on 07.18.15 at 3:41 pm

Very interesting article in the Globe today about inflation and why the BOC seems to be ignoring it. Of note is the Bank’s acknowledgement of cost-push inflation from the weaker CAD, which they view as temporary noise:

“In its Monetary Policy Report this week, the bank reiterated that the core rate is overstating the true underlying inflation in the economy. It is being juiced by some temporary rises in a few isolated components of CPI, and, more importantly, by what it calls the “pass-through effects” of the Canadian dollar’s depreciation.

“Those currency effects don’t reflect actual inflation pressure caused by an accelerating Canadian economy and growing pressures on the country’s production capacity; indeed, the Bank of Canada believes that due to the economic sluggishness of the first half of the year, spare capacity in the economy has probably increased. So it’s trying to look through the currency effects and gauge more meaningful underlying pressures on prices.”

On the other hand:

“The breadth of the [price] gains – with several key categories that have cumulative weights of nearly half the total CPI basket up by 2.2 per cent to 3.7 per cent year over year – dismisses a narrow emphasis upon supposedly transitory drivers,” Bank of Nova Scotia economist Derek Holt wrote in a research note Friday. “We are not changing our conviction that the BoC is facing a rising inflation threat that will soon come to increasingly question why it is cutting [interest rates] in this environment.”

https://secure.globeadvisor.com/servlet/ArticleNews/story/gam/20150718/RBRIINFLATIONPRINT

#164 Washed Up Lawyer on 07.18.15 at 3:59 pm

I just visited the Calgary Real Estate Board site and am mystified by what should be drawn from median and average sales prices. Maybe I just belong in a Home For The Bewildered.

The oilpatch has been pounded and engineers, lawyers and geologists are not exactly knee deep in clover.

So:

Monthly – June 2014 compared to June 2015

Median – Up .70%
Average – Down 1.49%

Month to Date – July 2014 compared to July 2015

Median – Up 1.75%
Average – Down 1.49%

Could it be that there is a comfort range on what people are prepared to pay for housing and that now they are getting more house for the same money? I am coming around to the sales mix theory. I am not convinced that median and average prices signify anything other than what the purchasing crowd think they can afford.

Dogs?

#165 Russ L on 07.18.15 at 4:00 pm

It is different in Nanaimo.

In response to defacing a piece of advertising, we will welcome buyers from afar.

The marketing arm, please see page 20:
http://issuu.com/ndnproduction/docs/nanaimo_homes_-_monthly_-_july_17

… Sailors don’t watch the forecast, they go out on the ocean and live it!

#166 Washed Up Lawyer on 07.18.15 at 4:08 pm

Sorry, month to date in July 2015 average price is down 1.90%.

#167 Blacksheep on 07.18.15 at 4:18 pm

A penny # 105, Water # 145,

I can’t speak for the rest of the country, but even if historic rainfall levels were reduced by 50 %, Vancouver and the Fraser Valley, would still not have a freshwater supply problem.

It would have a freshwater retention and distribution problem, which is a night and day difference. Yes substantial $’s will need to be spent on water infrastructure, but at least it’s solvable.

California and many other locals are parched and burning, while the Fraser Valley enjoys record sunshine.

The global climate is indeed changing and any body that still thinks Vancouver’s RE values are going down is not seeing the big picture.

#168 east van on 07.18.15 at 4:18 pm

Since last fall 2014 sfh on the east side have gone up 40% yup a million dollar tear down is about 1.4 and that is a unsustainable fact.

Not according to VREB stats. Show us your data. — Garth

#169 lee on 07.18.15 at 4:27 pm

#154, sunmonkey,

Did you ever think to check which of the properties he is showing you are rebuilds? Because if even one is, $400,000 to $700,000 might be a 5% increase over seven years plus rebuilds. I live in a house that has gone up about 3% a year since 2006 in a decent part of town. We are pretty happy about that. There are other houses in the area that have been torn down and rebuilt, or sold a second time after sale by a builder which have gone up a lot more, even 200% to 300 %. So as a result I live in an area where prices are up an average of 10% a year, year over year since 2006 when the rebuilds are added in. Your realtor isn’t telling you the whole truth. If he carves out rebuilds and of course houses two deeds from a builder then the market is normal. Maybe a tad higher than it should be. 3% a year is decent, maybe too fast. Add a 100% increase from a tear down on the same street and we are at an average of 51.5% a year for that street. Not that such an analysis is statistically reliable, but this is what the boards and realtors do.

Still, I do not believe anyone will be buying a $1,500,000 McMansion in Toronto for $1,000,000 ever, at least not between Jane and Victoria Park. Not enough land between these corridors to build on and too many people making too much money, too many people making cash money, too many government employees making too much money, and a CRA that isn’t able to stop cash horders. If you missed the real estate boat, don’t worry, just move to Europe where everyone rents. Don’t you watch House Hunters International?

#170 exchange of ideas on 07.18.15 at 4:33 pm

B.C. Premier Christy Clark, “By moving foreign owners out of the market, housing prices will drop,” she cautioned in May. – CBC
……
Property purchases by non-Canadian residents could be outlawed tomorrow and there would be zero impact on YVR prices — Garth
….

Therein lies the conundrum. Our neighbour sold to speculators from China. I met them. They showed up once, a couple of middle aged ladies with an entourage in SUV’s and left. They never return. Place has been vacant for three years now. I like it. Easier to get along with than locals. Sometimes I walk over with a lawn chair and sit in their backyard to read in peace. 604, tricities.

No conundrum. She made it up, because she knows nobody actually wants lower prices — Garth

#171 Estrella on 07.18.15 at 4:34 pm

When has critical analysis of canadian economy suddenly become unpatriotic? Remember that we fought for the right to be able to openly critique government and politics. (its called democracy 101 ). I will place my money on the blackjack table where i see the favourite to win is leading me. No ifs or buts about it. My money, my choice.

If you want to live somewhere like say China, maybe your choices become limited to sovereign control, but we fought this side of the world to have the freedom to have open discourse and lively debate such as witnessed on this blog.

If you don’t like how are government is governing, lead the way with your vote. No good choice candidates? join the fray and try to do it better. Raise your kids to participate in politics. Don’t like something, voice you opinion to your mp, and mpp.

Everyone remember certain names leaving canada in the last 5 years like Kellogg, Heinz… Where do you think Canada is going economically?

More to come on that note, I believe….

Global world, global economy. My money goes where i get the most return. That is currently not in Canada.

#172 SWL1976 on 07.18.15 at 4:42 pm

#155 Has anyone seen this?

http://dailycaller.com/2015/07/17/satellites-earth-is-nearly-in-its-21st-year-without-global-warming/

(second biggest scam next to the print money out of nothing and charge interest money system)

————————————————

Ask anyone in the north who rely on ice cellars to preserve their meat what they think of that satalite data from the University of Alabama.

http://www.pressherald.com/2010/06/13/warmer-climate-thaws-ice-cellars-in-arctic-villages_2010-06-13/

I do however whole heartedly agree about the money printing scam though

#173 salonist on 07.18.15 at 4:47 pm

#149 TRT, the space bar counter calling mark out

#174 Nagraj on 07.18.15 at 5:07 pm

cuz today the weather’s so unpleasant here

Harper’s reputation as a pig-headed bully is pretty well established in the public mind, I’d say. [Apologies to our porcine and bovine friends.] But lately, I’d say, this is morphing into “and he’s stupid too”.

The trippy performances of Joe O (the ultimate yes man) and prevaricating Poloz (in their ongoing “All’s Almost Well” comedy revue) certainly aren’t helping Harper’s reputation as an economist –

What’s should be of compelling interest: IF the Canadian economy were doing well (and not fearing for its very GDP life in the next quarter) Harper, however lacking in character, would still have many, many friends –

Leadership, all protestation to the contrary notwithstanding, is merely the crest of the wave, and the crest goes where the wave takes it. If enlightened leadership could make a critical difference we’d be in some paradise instead of on planet Earth.

But wouldn’t that be dull and boring. (Like the SPX is now.)

#175 NoName on 07.18.15 at 5:32 pm

of topic

Funeral homes start hosting weddings, proms and breakfast with Santa (how funny is that).

http://bigstory.ap.org/article/13da3381dbb64922890bc9a9849d4db8/death-business-expands-hosting-weddings-other-events

“Her only concern was to make sure the photographer avoided getting gravestones in the pictures”

#AreWeAllNutsYet

#176 Bottoms_Up on 07.18.15 at 5:49 pm

#173 Nagraj on 07.18.15 at 5:07 pm
—————————————
Actually Harper comes across as quite intelligent when he speaks. This to me was his gravest error, by shunning the media he didnt allow Canadians to get to know him. If i were in charge of the conservative election campaign, i would get him in front of every microphone possible. He’s their best chance at re-election, and if they hide him, they LOSE.

#177 Bottoms_Up on 07.18.15 at 5:55 pm

#161 devore on 07.18.15 at 3:39 pm
———————————–
Price is important, but at a certain point you just want quality. I’ve purchased shoes from walmart for 30$ that fall apart in 1 month. Enough of that. Moved to 100$ shoes that now last a couple years. So quality can play a role too.

#178 Bottoms_Up on 07.18.15 at 5:58 pm

Property purchases by non-Canadian residents could be outlawed tomorrow and there would be zero impact on YVR prices. If 5% downpayments became 10%, the impact would be immediate. So obsess about something that actually matters. — Garth
————————————–
If foreign purchasers represented like 10% of purchases, they would own all the real estate after only a few decades. So, the info we do have that shows foreign money at 2 or 3% is believable.

#179 Sheane Wallace on 07.18.15 at 6:31 pm

#34 Mark

2.24 for 30 years Canadian bonds. Truly? With official inflation over 2%, real north of 4 maybe even 5, food north of 10? One must be complete idiot to buy CA government bonds except if:
1. Institutional investors as mandated
2. Carry traders expecting further decline in interest rates.
3. Crazy ‘investors’ like Mark.

With so many great companies and ETFs providing alternative of 4-5 % dividends only, not to mention stock market appreciation one must be crazy to touch bonds.

Only crazy would think that financial oppression can go for 30 years.

They will overdo inflation, we are in such bad shape that even significant inflation can’t even maintain nominal GDP (negative ‘growth’ in 2 quarters, there will be third… ) and will lose control of the bond market.

CAD is and will be toast, Mark, how much did you lose from that USD shorting?

#180 Sheane Wallace on 07.18.15 at 6:49 pm

#162 Balmuto

Poloz lies, hat do you expect from Harpo’s lap dog?

Inflation is evident, but we are bankrupt so expect much more. Based on current fundamentals, debt and housing (that would not be allowed to depreciate as everyone goes bankrupt, despite mark’s hopes) CAD costs around $ 0.35 – 0.40.

Our problem is that we depreciate the currency WHILE INFLATING the huge credit bubble and the biggest housing bubble ever on earth (maybe except Ireland) without actually contracting credit and fighting the effect impact and effects from the credit orgy.

I am still very confident that in an environment of low commodity prices and with significantly declining economy (just look at the record trade deficit) there is nothing else left then trying to blow further the housing bubble, it is a final breath of a terminal ill economy.

When it blows we would be left with substandard housing (wooden card board houses and glass condos) , no economy, no savings (due to the coming significant inflation).

The idea that we can compete with Mexico in cheap labour and the cons in power working their asses out to align CAD with the peso in terms of purchasing power is alarming.

the guys are very ‘capable’ and ruthless, we have seen nothing of the real crises yet.

I continue to believe that without CMHC our houses would have been 2-3 time cheaper. A house of $ 400 k in Toronto makes sense. One of 1.1 mil does not.

Unless you suppress the rates and measure in confetti instead of money.

We run the danger of seeing 6-8 % real inflation (they will lie about it) that will kill the bond market.

It is a crime to reduce rates in environment of raging inflation. Poloz should go to jail.

#181 Steve French on 07.18.15 at 6:56 pm

Dear Sir Garth:

check this out:

http://www.vancouversun.com/opinion/columnists/offshore+real+estate+data+staring+face+this+time/11223346/story.html

“Odd, isn’t it, that a simple statement of citizenship would be considered so onerous to “the cost of doing business in B.C.” that it had to be repealed?

It’s odder still considering that there still exists an example of the provincial government asking for proof of citizenship in a real estate matter.

It is called the Property Transfer Tax Return. It stipulates the conditions that qualify homeowners for exemptions to the property transfer tax. It’s not easy to find on the government website, but it’s there, hidden in plain sight.”

—————

… are you starting to lose this argument around the feasibility of a basic citizenship check for property purchases?

————–

Steve

You are worrying about the wrong thing. What a waste of time. — Garth

#182 Sheane Wallace on 07.18.15 at 6:59 pm

Still, the big question is whether, by slicing up inflation so many ways in an attempt to filter out the noise, the Bank of Canada is getting this right. Not everyone agrees that the pressures in the core rate are as transitory as the central bank keeps telling us.

“”The breadth of the [price] gains – with several key categories that have cumulative weights of nearly half the total CPI basket up by 2.2 per cent to 3.7 per cent year over year – dismisses a narrow emphasis upon supposedly transitory drivers,” Bank of Nova Scotia economist Derek Holt wrote in a research note Friday. “We are not changing our conviction that the BoC is facing a rising inflation threat that will soon come to increasingly question why it is cutting [interest rates] in this environment.”

https://secure.globeadvisor.com/servlet/ArticleNews/story/gam/20150718/RBRIINFLATIONPRINT

The ‘economists’ Harpo, Poloz and Joe should know better. Or they simply lie.

#183 Nosty, etcc. on 07.18.15 at 7:19 pm

SWL1976 — Nice blog! And #120 — Coho — Great post!

#138 Spectacle on 07.18.15 at 10:40 am — “The low level jobs are being replaced with Temporary Foreign Workers, exactly the same as Tim Hortons.”

Along with robots, which lead to Socialism described in six memes, and to have a better perspective, see the new Mt. Crushmore. That’s the way humanity is headed. For example, this story — Biting off more than one can chew — is a good example of people overextending themselves.

A once-regular poster here, Nostradamus Jr. (Dad) moved on to bigger and better things a few years ago, but he maintained that the US was going to bankrupt TROTW to hold on to their #1 ranking, as the world’s policeman / superpower.

It appears he was correct in his prognostication (here too).

However, each action has an equal and opposite reaction that becomes an eye for an eye, a tooth for a tooth. Nothing lasts forever. Everything is temporary, it’s simply a matter of when one puts a step wrong that the stuff in the world — it’s just stuff, after all — will unravel quicker than anyone can keep up with it.

#184 Daisy Mae on 07.18.15 at 7:31 pm

#115 KARMA: “If one loves one’s country truly then one should be compelled to point out when it’s being run poorly. NOT caring about one’s country would be telling people that the country is doing great even when one knows that this not true, just to avoid hurt feelings…..

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

And that’s exactly what Garth is doing. If people can’t handle the truth, that’s just real tough.

#185 LL on 07.18.15 at 7:42 pm

# 179 S Wallace

It is a crime to reduce rates in environment of raging inflation. Poloz should go to jail.

Bankers never go to jail, they just pays fine (except in Iceland).

#186 lee bow on 07.18.15 at 8:18 pm

Isn’t it strange that Garth feels prompted to respond to such a stupid accusation?

Looking at the options, the only way out is to inflate things away.

#187 triplenet on 07.18.15 at 9:00 pm

#163 Lawyer

You shouldn’t pay much attention to those types of statistics. They are for the little people who think understanding simple arithmetic is the ticket to successful real estate investment.
Tell your wife she’s average looking/attractive/sexy and can cook and average meal. After the pain subsides correct yourself by telling her she’s actually median and you made a descriptive mistake.
That’s when you’ll feel somewhat sheepish. Averages are for average people. Who wants to be average.

#188 Voting is a waste of your time on 07.18.15 at 9:41 pm

#176 Bottoms_Up on 07.18.15 at 5:49 pm

#173 Nagraj on 07.18.15 at 5:07 pm
—————————————
Actually Harper comes across as quite intelligent when he speaks. This to me was his gravest error, by shunning the media he didnt allow Canadians to get to know him. If i were in charge of the conservative election campaign, i would get him in front of every microphone possible. He’s their best chance at re-election, and if they hide him, they LOSE.

He cant take any unscripted questions because someone will ask about fake terror, fake train explosions, fake RCMP shootings….or even better ,
why does engage in hate speech against identifiable groups?

‘get to know him’?

Impossible

#189 45north on 07.18.15 at 10:33 pm

yeg-guy:
YEG = Edmonton International Airport

https://www.world-airport-codes.com/search/?s=edmonton

The Sharmas just moved into a new 2,300-square foot detached home they bought in southeast Edmonton for $538,000, while their former home, a duplex unit that’s listed at $399,000, remains on the market.

these are the kind of people who stand to be wiped out. I told the story of how I owned two houses. Briefly in Ottawa. In 1985. Fortunately nothing much was happening in Ottawa real estate and I sold the first house.

Llewelyn: My father worked for Eaton’s of Canada for 45 years and I can still remember his observation the day Walmart bought the majority of Woolworths stores in Canada.

“Son

son! I’m surprised:

http://www.imdb.com/character/ch0034334/bio

sort of like Tyler Durden

#190 observer on 07.18.15 at 10:50 pm

Canadians are Beavers,

They will not starve, they will eat bark!

That what you get for not paying attention in school.

Good luck your house is up be same will the taxes you pay to your makers. And good luck eat mack and cheese for the next 5 years

#191 45north on 07.18.15 at 10:50 pm

Rona is buying back its franchise stores, including two in Ottawa and three in Gatineau, as the Quebec-based home renovation specialist tries to better compete with American rivals Lowes and Home Depot.

http://ottawacitizen.com/business/local-business/five-capital-region-stores-affected-as-rona-buys-out-franchisees

I’m thinking that accounting is more complicated if each transaction has to be divided between franchisor and franchisee.

Lowes in Ottawa has taken on Rona and Home Depot. Spent millions to set up a store on Hunt Club Road. There have been a lot of changes in big hardware / lumber stores in Ottawa. I remember Cashway on Innes Road and Pascal’s on Merivale Roads.

#192 DisgustMadeMePost on 07.18.15 at 11:03 pm

And that’s the thing that always gets me.

Re: Christie , foreigners and house prices. .. She made it up.

You mean, she lied to us??!

Seens to be the norm these days. So sick of them all.

#193 Republic_of_Western_Canada on 07.18.15 at 11:58 pm

More evidence of deflation:
http://www.cnbc.com/2015/05/29/im-shorting-gold-heres-why-trader.html?__source=seekingalpha

I guess that plan to push all the chinese into the stock market was a little premature – like Iran’s U.S.-backed modernization strategy was a few decades ago.

When gold gets below $500,- time to mint gold coins for circulation again. That, and Iranian oil, will cap inflation for the next quarter century.

#194 Has anyone seen this? on 07.19.15 at 12:16 am

Ask anyone in the north who rely on ice cellars to preserve their meat what they think of that satalite data from the University of Alabama.

http://www.pressherald.com/2010/06/13/warmer-climate-thaws-ice-cellars-in-arctic-villages_2010-06-13/

I do however whole heartedly agree about the money printing scam though

———
http://iceagenow.info/

cheers !!

#195 For those about to flop... on 07.19.15 at 12:20 am

#191
Lowes in Ottawa has taken on Rona and Home Depot. Spent millions to set up a store on Hunt Club Road. There have been a lot of changes in big hardware / lumber stores in Ottawa. I remember Cashway on Innes Road and Pascal’s on Merivale Roads.

————————————————–

I’m glad there was no spellcheck error on Hunt Club Road!

#196 Leo Trollstoy on 07.19.15 at 12:58 am

CAD is and will be toast, Mark, how much did you lose from that USD shorting?

He doesn’t need to short to lose. He’s been losing on the CAD/USD pair for a year.

Just like his gold/mining.

His posts are entertainment-only. He offers no financial value. Actually the opposite. Financially misleading.

#197 sunmonkey on 07.19.15 at 8:19 am

Yes it has been pretty insane. Houses bought in 2009 for 400k are selling in 2015 for 700k. The price appreciation is 75% in 6 years. This is absolutely nuts.

This is based on sold history reports that I am receiving from our agent on homes that we have been interested in.

Where? — Garth

Leslie & Steeles, Warden and 401, Van Horne & 404, etc.

eg. a semi-attached home on Van Horne was listed for 700, previously sold in 2007 for 390k, sold in 2015 for 789k. After 8 years, the home increased in value by 102% based on the sold price.

eg Another semi-attached home on harringwood previously sold for 450 in 2010 sold for 850 in 2015.

There are plenty of examples like this across the GTA.

It is really insance that people are willing to pay exorbitant prices for semis in the GTA.

#198 SWL1976 on 07.19.15 at 8:19 am

#194 Has anyone seen this?

http://www.geoengineeringwatch.org

Something strange with the weather near you?

Well it’s not by chance.

Cheers!

#199 sunmonkey on 07.19.15 at 8:51 am

#169 lee

None of these homes are rebuilds and need 50-80k of work.

It is nuts..

#200 Herb on 07.19.15 at 9:20 am

#191 45north,

you didn’t remember the three Beaver stores in Ottawa, but then the whole chain closed after Home Depot invaded Canada.

Could not see the point of Lowe’s coming into Canada. Their prices and stock were the same as Home Depot, although they had a different house brand in their tool line. I wonder if they will share Target’s fate in the long run.

Best lumber/hardware store in the Ottawa area after Pascal closed is Reno Depot in Gatineau.

#201 Smoking Man on 07.19.15 at 9:29 am

Ha, Donald Trump calls McCain a loser, says he’s only a hero cause he got captured. He likes guys that don’t get captured. Trump says he helped him raise a million last time around, but he lost, so he’s a loser.

I agree, and Mr Smoking Man ready for a divorce over it. She gets her news on TV, I get mine from the wild Web.

We’re is Canada’s version on Trump… He would get my vote.

#202 Herb on 07.19.15 at 9:37 am

In case anyone is still interested in Greece, a great description of the Hellenic state of affairs –

http://www.vanityfair.com/news/2010/10/greeks-bearing-bonds-201010

#203 Setting the Record Straight on 07.19.15 at 9:39 am

@131
“The only thing worse than evil men are good ones who stand by and do nothing. Do something this election. Don’t split the vote.”

Do something meaningful. Start a movement. Refuse to vote!

#204 the Jaguar on 07.19.15 at 9:42 am

#151 Just Sayin: re your link to that article. The question (are you a Canadian citizen or permanent resident) really wouldn’t tell you much, because many of those with cash from china are permanent residents of Canada. doesn’t mean they spend the majority of their time in Canada or make their money here, but they get the permanent residency card. Of course now the Canada Border Services tracks exit and entry to the country the amount of time they spend out of the country gets a little trickier.
#144 Karma: Not all those foreign students rent. Many buy properties to live in and even obtain mortgages from Canadian banks. They just need 35% down which usually comes from the parents overseas.

#205 Squirrel meat on 07.19.15 at 10:27 am

#198 SWL1976 on 07.19.15 at 8:19 am

#194 Has anyone seen this?

http://www.geoengineeringwatch.org

Something strange with the weather near you?

Well it’s not by chance.

Cheers!
—————————–

Chemtrails everywhere this week across Alberta… bam next thing you know BOC lowers interest rates. Coincidence?, I think not. The Apocalypse begins. Best stay away from Walmart the next few weeks.

#206 Setting the Record Straight on 07.19.15 at 10:31 am

@180

Our problem is that we depreciate the currency WHILE INFLATING the huge credit bubble and the biggest housing bubble ever on earth (maybe except Ireland) without actually contracting credit and fighting the effect impact and effects from the credit orgy.”

It’s not Harper. It’s politicians!
It’s not Poloz, it’s central banks.

#207 Setting the Record Straight on 07.19.15 at 10:40 am

@181
Think about the information the state insists it has the right to monitor, but one small piece of information about property transfers is verboten.

Canada exemplifies Lasch’s Revolt of the Elites.

#208 waiting on the westcoast on 07.19.15 at 12:18 pm

#191 45north

“Rona is buying back its franchise stores, including two in Ottawa and three in Gatineau, as the Quebec-based home renovation specialist tries to better compete with American rivals Lowes and Home Depot.

http://ottawacitizen.com/business/local-business/five-capital-region-stores-affected-as-rona-buys-out-franchisees

I’m thinking that accounting is more complicated if each transaction has to be divided between franchisor and franchisee.”

Less to do with accounting and more to do with capturing more margin. The Franchisor makes money off of royalties but lose the benefit of the profit the franchisee makes. By purchasing the Franchisee, they have a larger revenue stream (which is good for PR for a pubco). They also capture the profit (so say another 10-15% to their bottom line).

Franchisees are great for taking the risk out of building/scaling the market. Once they saturate, it is a better play to acquire them and get economies of scale.

#209 NoName on 07.19.15 at 12:33 pm

#198 SWL1976 on 07.19.15 at 8:19 am
#194 Has anyone seen this?
http://www.geoengineeringwatch.org
Something strange with the weather near you?
Well it’s not by chance.
Cheers!
—————————————————————-
That is very interesting that you worry about geo-engineering, “chem” trials and airborne toxins, but seems not to be worried that your line of work is probably exposing you daily to same things, like fine particulate dust, welding fumes, solvents vapours, lubricants… Take a look at your hands and ask your self is there anything seeping in thru my skin, when I touch bad stuff. (hint, skin is your biggest organ), than use those very same hands to gogle “Transdermal”.

and small advice when you do your search use neboughrs wifi, they are watching you.

have a nice conspiracy day!

#210 NoName on 07.19.15 at 12:34 pm

resherch

#211 Jake Stalvic on 07.19.15 at 12:54 pm

On a Toronto radio station they’re pushing more real estate telling people 8% to 9% a year is a sure thing.

Some company called Fortress and how they have different projects all around Canada and how you can diversify by choosing which one looks best.

If Canada’s housing market all go down some less and some more, then that will not help investors at all.

#212 Westcdn on 07.19.15 at 1:08 pm

I can eat bark – good luck with that. American politics are getting interesting. I think Trump is going to give Hillary a run for her money.
I am surprised Alberta is hanging in there despite prominent opinions. I see Rachel wants to support Energy East, too bad the rest of Canadian politicians are brain dead except for Sask. I am becoming a fan of the American – may she post more. I haven’t forgotten SM – I still have respect for you.

#213 Fred Buys Cheap and Sells High on 07.19.15 at 1:39 pm

Garth…while you pump Euro stocks and China on a dizzy recency effect high…you forget the overall 20 year returns from a much lower beta and higher return Canadian market. Trading & Crystallization just triggers admin and taxation costs.

Sure…it’s always 20/20 when something turns down for a week or a year….but a downturn is a time to buy at depressed prices….not jump in bed with the tax man and throw away all your gains by panicking from one media frenzy to another.

That’s why retail investors always lose ..they haven’t the ability to think long and stick to their original plans.

Here’s the secret…buy good companies that have a 20 to 40 year history of increasing their dividends and buy evere time there is a downturn.

Why…Poloz is a blip on the radar…eventually someone with more sense than this clown will regain control. Obama is a doofus whose time is passing quickly…his attack on Canada will come to an end in 20 months. Internationally the economy will regain a footing and these noisy patches will sing the praises of Canadian resources once again…and we will continue being a safe and profitable place to invest.

Stop listening to media doomsters and all those who have no skin in the game.

The only thing I ‘pump’ is a balanced and globally-diversified portfolio that ignores stock-pickers like you. It’s a proven long-term winner. — Garth

#214 Nora Lenderby on 07.19.15 at 2:20 pm

#186 lee bow on 07.18.15 at 8:18 pm
…Looking at the options, the only way out is to inflate things away.

I hope it works. It’s pretty bad that we’ve got here, although I’m not under the illusion that I could do any better if I were in government. (Most of it seems to be through giving the population more freedom than they can handle in the form of access to cheap money, and then not clamping down when it became apparent).

Poor Mr. H. is now reaching the Robert Mugabe event horizon…all his friends have jumped, fallen or been pushed off the bus…

#215 Nora Lenderby on 07.19.15 at 2:23 pm

#203 Setting the Record Straight on 07.19.15 at 9:39 am
@131
“The only thing worse than evil men are good ones who stand by and do nothing. Do something this election. Don’t split the vote.”
Do something meaningful. Start a movement. Refuse to vote!

I hope that last remark was ironic. Not voting is doltish behaviour, in my opinion.

#216 SWL1976 on 07.19.15 at 2:30 pm

#209 NoName

So because I earn a living in heavy industry I should forget about a global injustice?

Yes I am aware that our skin is our largest organ and we are virtually defenseless against nano particulate which may or may no be in chemtrails.

My job is my choice.

The spraying of populations with unknown toxins is not a choice.

I know they’re watching

#217 Setting the Record Straight on 07.19.15 at 3:40 pm

@215#215 Nora Lenderby on 07.19.15 at 2:23 pm
#203 Setting the Record Straight on 07.19.15 at 9:39 am
@131
“The only thing worse than evil men are good ones who stand by and do nothing. Do something this election. Don’t split the vote.”
Do something meaningful. Start a movement. Refuse to vote!

I hope that last remark was ironic. Not voting is doltish behaviour, in my opinion.
&&&&&&&&
I’m sorry but your hopes are to be dashed and shattered upon the rocks below; Both your hope that my post was ironic and your hope that voting is meaningful.

#218 vatodeth on 07.19.15 at 5:52 pm

Thanks Garth! For all of the lessons and time you’ve put into sharing them with us!