Fear is greater than greed.
That pretty much describes things on Monday when stock markets plunged, recovered, wobbled and weaved. The doomers saw it as the beginning of the end. Bottom-feeders feasted on Apple stock. Day traders knew it was better than sex. Sage investors ignored it.
After all, a correction of 10% or more for the Dow or the S&P doesn’t mean the US economy is sick. It’s not. Instead, after hovering around record highs for the longest period of time in 90 years, markets blew off some gas. That’s how dangerous bubbles – which pop with far worse, longer-lasting consequences – are avoided. Like the one brewing with Canadian real estate.
But market declines spook people. We think the worst. The media and the bullion-hocking newsletter guys know that. Human nature clicks in – the same hormones which makes people want things that keep getting more expensive. Once again the emotional are led to slaughter – those who bought high end up selling low. A few days, weeks or months later it all passes. Only the realized losses remain. Poor little sods.
So, stocks are fun to watch, but oil matters more. Watch that this week. It means jobs.
Crude oil (WTI), last 12 months
The price of crude is close to $38 US. It was ninety-four bucks a year ago and sixty dollars in June. Oil lost 5% of its value again Monday and probably has more to go. At these levels there will be a lot more people out of work in our pivotal energy sector, even more empty office space in Calgary’s towers and more projects cancelled. Revenues from the country’s major export commodity have plunged, and big producers are pumping at a loss.
These are the two real consequences of the current mess: Job stress putting downward pressure on housing markets, and a move to the political left. The Bank of Canada can slash interest rates to zero, but it’ll be a loss of employment confidence and higher personal taxes that most impact people’s lives. Looks like both are coming.
Now, here’s my take on investments and equity markets.
First, Corrections are normal. We’ve had seven of them (5% or more) in the past four years. The last whopper was in 2011 (20%) during the US debt ceiling crisis. At that time this blog was a virtual swamp of primordial juices, rendering it damn hard to type above all the wailing. Of course, it passed. The stock market then advanced by 70%, making geniuses of people who stayed invested or got that way.
Second, nothing about the US recovery has changed over the last few weeks. The economy there grew at a strong rate of 2.3% in the second quarter. Over 13 million jobs have been created in 65 months with an average monthly addition of more than 200,000. Corporate profits are robust, and forecast to rise above 10% in each of the next two years. The budget deficit has plunged and Donald Trump will surely fix everything else.
Third, yeah, China matters. It consumes more commodities than any other nation. Weakness there means troubles in Fort Mac. But the world’s engine is still America, and that will not change for a long, long time. This is why US equity markets have advanced relentlessly since the 2008-9 blowoff, but even so, valuations are not inflated by historic norms.
Besides, China was an accident waiting to happen (which is why investors should have only about 1% exposure to it). The geniuses in Beijing allowed massive speculation on the part of unsophisticated, leveraged investors, which sent the stock market to insane and unsustainable levels, creating excessive volatility. Despite the trip back down, the market’s still up by 40% over the past year.
Fourth, the commodity collapse is already overdone. Prices for copper, oil, grain, nickel and much else are way below levels experienced during the GFC when the world economy was contracting fast. Yet these days the world’s expanding, albeit slowly. If anything, cheap energy and other commodities support more global growth. So it’s hard to see how this will not snap back.
Finally, the kind of portfolio I’ve encouraged – balanced (with safe stuff and growth assets) and diversified (among assets and regions) – is designed to mitigate against days like these. And it’s working. Nobody whose investments are structured this way has seen a 10% drop.
But, as I said, fear is greater than greed. So I’ll probably be writing this same blog again in four years. At least you’re getting your money’s worth here.
250 comments ↓
Furst on Gray Monday?
And there you have it!
If the wife is house horny
and you’ve convinced her that we should invest in the markets… what we are seeing is housing continues to go up and then this past week happens…
How do suggest best to eventually buy a house, and when?
Do you wait 5 years and hope a balanced portfolio outperforms real-estate? Or, will housing crash, but so will equity markets? How do you then sell in order to have the funds to purchase a place?
The main point is this – we get the message of eschewing risk – but housing is still desirable. Your message is “freedom is better than housing” — but can we have both? And if so, how?
Garth. I bought a couple Canadian Gold Maples for abt. 275.00 Can. in 2001 and can get 1,500.00 Can now. Thinking of selling them. Question, will I have to pay capital gains tax on them? Thanks
Stock Market – Diversification is critical. 60/40 split… boring as heck but works. Stocks go down, bonds go up. It’s a balance.
Alberta O&G – Just returned after a 16 hour drive to Fort St. John, BC from Calgary, AB for a wedding. Mixed economy up there like Fort McMurry except Gas related. 1/2 the people (50+) couldn’t attend the wedding due to the economy. For Sunday traffic, it was pretty light all the way up and back.
While I agree that investors should not panic, what I don’t understand is the often-espoused belief that market downturns like this are good buying opportunities and that the U.S. is economically just chugging along.
What ever happened to the common knowledge that economic cycles exist? Since WWII, the median period of time between recessions (defined as two or more quarters of negative real GDP growth ) has been 18.5 quarters. We have now gone 24 quarters in a row since the ’08-’09 recession. Why isn’t it only logical that we are headed into a recession now? Or if not now, some time within the next 12 months. And if we ARE headed into a recession of any (even minimal) magnitude, isn’t it only reasonable to assume that equity prices will get clobbered down from today’s levels?
Nobody whose investments re structured this way has seen a 10% drop.
—————-
Yup, pretty much matches what I calculate.
If this continue, The Fed will finally have it’s excuse to delay rate hike until Next year.
Blame it on China!!
Yet, we have the cratering dollar. We have ever widening inequality between rich and poor. We have ever rising consumer debt…and what about the great housing bubble?
hehe i knew you were going to have a field day with the oil news…
http://www.vancouversun.com/business/energy/bloodbath+erases+billion+from+industry/11313522/story.html
That was a fun ride
first?
Blah, who really cares about all this? With HFT and corporate corruption, the sheeple will be fleeced regardless of their investment strategy. Same thing goes with the Canadian real estate scam. Live BELOW your means, be satisfied with what you have, and don’t let other peoples’ greed become your infection.
I think I’m off balance…
There is still a few weeks of summer left. Break out the shorts.
Any tactical play here Garth if we want to shift slightly to gain a bit on resource upswing? Too early for XEG?
First.
Yup – it will bounce back.
It is times like this I really appreciate this blog. Main stream media is not reporting on what has happened or what is going on. There is a “great” story here for how this can even happen when we know what we know. And what a opportunity this is.
Keep blogging man, get the word out.
To paraphrase George W. Bush regarding Stock & Bond markets: “THESE SUCKERS ARE GOING DOWN!!” Time to be in cash and can goods. Anyone with too much debt and a big mortgage is screwed!
First!!!
The Hayne plane is flying, just like the Dow will within a week!!
“Donald Trump will surely fix everything else.”
Is that an election prediction? And who here? Harper?
BTW, Is it just possible that the US central bank’s trillions of QE had anything to do with those 6 years of rising S&P?
So, now we’re all waking up to the fact that the 2nd largest economy on earth is a giant ponzi scam (with government officials taking the $$$).
If that dries up, will Vancouver/Toronto real estate see the impact?
“Fourth, the commodity collapse is already overdone. Prices for copper, oil, grain, nickel and much else are way below levels experienced during the GFC when the world economy was contracting fast. Yet these days the world’s expanding, albeit slowly. If anything, cheap energy and other commodities support more global growth. So it’s hard to see how this will not snap back.”
Right, it’s either commodity prices are too low or we’re about to enter GFC 2.0, justifying those prices. Either way though I think buying a commodity ETF at these levels would be a great pure play on a eventual commodity rebound, even if there could be a few more gut-wrenching drops to follow. You could have a great return over a 5-10 yr horizon from here.
Last comment for a while…I’ve got a job to go to still!
Garth, Sorry I disagree with you on the Bull…is Bull.
I get first class research and it ain’t free.
Numbers coming in says BEAR. We went to cash for a reason…Here’s a snippet and best of luck!!
“With three Daily big-bars down, the bull market is over. Step One was the inability of the
S&P to get above the 50-Day ma. That was on Tuesday.
The next failure was in taking out the 200-
Day ma on Thursday, which was Step Two.
Moreover, on Friday and today, the bars became progressively larger. The steepness of
the plunge in the S&P is looking like
that for the Nasdaq in April 2000.
On the broad market, the NYSE Comp close on
Friday was below the low close of last
October. ”
Wow. Bars. — Garth
With commodities at such depressed levels…wouldn’t now be the time to buy some choice ETF’s?
This should be interesting in the coming months…
Vancouver’s booming real estate industry is being targeted in a federal money-laundering audit that could potentially lead to massive fines and jail time for realtors.
Federal audit takes aim at money-laundering real estate transactions in Vancouver area
http://www.theprovince.com/business/Federal+audit+takes+money+laundering+real+estate+transactions+Vancouver+area/11311753/story.html
Second, nothing about the US recovery has changed over the last few weeks.
That’s right. And now the massively overpriced U.S. market has finally coming back down to where it should be.
Forget the housing grind. The markets will be continue to grind lower in deference to mediocre earnings and corporate prospects.
Tonight’s post is eerily optimistic
Think tomorrow will start with a Dead Cat Bounce? Go long. Imagine Royal Dutch trading below the value of its assets let alone reserves. Could you imagine the stop loses triggered today… margin calls next sheeesh
“Donald Trump will surely fix everything else.”
Well, according to Trump:
“I’ve been telling everybody for a long time China’s taking our jobs, they’re taking our money. Be careful, they’ll bring us down.”
Every body at once.
Scream- QE4 please Masters.
Because if they don’t the markets hooped.
Garth:
US equity markets have “advanced relentlessly since the 2008-9 blowoff” (a time when you yourself were predicting years of recession in the US) purely on the strength of the Federal Reserve’s QE and ZIRP. The former stopped about 9 months ago and the so-called markets had (until a week or so ago) been at best range-bound. Now the mere threat of the latter going away (i.e. a possible 0.25% increase in the federal funds rate) is looming, and it’s all-out panic. Funny, this doesn’t seem like any kind of basis for believing in the strong growth/recovery narrative to me.
(a) I never predicted US recession, (b) the equity sell-off is hardly related to the Fed. — Garth
http://1.bp.blogspot.com/-uZ2lCARnFi0/TxDWx_9YHfI/AAAAAAAAAl4/dZjB1E3mppM/s1600/Market-Emotions-Cycle.jpg
Just seen a guy on bnn say that we are in the fear part of the investment cycle.
This is the first time I have ever watched bnn
I tuned in to see how many ” green triangles” there was.
Only seen one.
#21 T.O. Bubble Boy on 08.24.15 at 5:47 pm
So, now we’re all waking up to the fact that the 2nd largest economy on earth is a giant ponzi scam (with government officials taking the $$$).
If that dries up, will Vancouver/Toronto real estate see the impact?
**************************
YOU BET YOUR BUNS………….!
Ha Ha Ha !!!
Stocks throwing a TANTRUM with a hint of rate rise….seriously a quarter point raise…. and miniscule slow down in China….
This freakin showcases the grand house of cards, that QE helped build in the past 8 years…. I better not cough….
Royal Dutch Shell (RDS.A)
YTD: -25%
Dividend yield: 7.55%
Price: $49.81 USD
WOWZA!
Jimmy Joe,
Yes, you have to pay capital gains, from a legal perspective. Ethically, we have to pull our weight.
#8 NextYear on 08.24.15 at 5:31 pm
If this continue, The Fed will finally have it’s excuse to delay rate hike until Next year.
=======================
Most people seem to think the Fed can’t raise rates this year because it will “hurt markets”. The other side of the coin is the Fed wants and needs to start hiking rates to regain control.
After the market swan dive we’ve just seen, do we really think a quarter point will make any difference now? They might as well just do it. Why waste a good crisis?
Buy everything in cite.
SM
Once the roller coaster levels off I will be doing some bottom feeding with my cash reserves. I will be following this blog very closely in the next several.
Thanks Garth for the columns based on day to day events happening now, it is actually quite comforting.
No doubt the regularly scheduled real estate channel will be back VERY soon as well.
In this crazy market, we’ll see who is the goat.
#6
” We have now gone 24 quarters in a row since the ’08-’09 recession. Why isn’t it only logical that we are headed into a recession now?”
This has nothing to do with logic. As i have said before, logic is about deductive inference. Given the truth of premises, the conclusion cannot be false in any possible world.
What you are using is inductive inference, in the sense of David Hume. Since the past has shown that things tend to recur in patterns, the future should do the same. That is the opposite of logic. Now you are into the realm of probability theory and statistics.
The fact is that there are no useful models for predicting the behaviour of complex systems like economies. You can cite Kondratieff Wave Theory (or whatever it is called), standard macro-economics… doesn’t matter. None of them have predictive power, particularly for high frequency details like the state of markets or a daily or weekly basis.
Trying to time markets is hard. Making broad statements about general market trends is a bit easier, but still not guaranteed. Hence it is not a matter of logic.
need some foreign investors…the kids don’t want em
“Tokyo could end up being surrounded by Detroits,” the vacant-house spreading through regional cities and the suburbs of major metropolises. Even in the bustling capital, the ratio of unoccupied houses is rising.
http://www.japantimes.co.jp/tag/vacant-houses/
RE: #13 shad on 08.24.15 at 5:37 pm
I think I’m off balance…
Yes. Once the rout is over it will be time to sell some bonds and buy some more equities.
Listen to the IEA and invest in Renewables. It is the future. The world is awash in energy resources, invest in the technology that has the lowest carbon footprint. Solar has already been proven. More than enough supporting evidence.
Great Blog Garth, you have really put things into perspective for me. Major opportunities for Canadians ahead…
#38 Smoking Man on 08.24.15 at 6:48 pm
Buy everything in cite.
SM
—————
Please be more precise. Which city?
#36
“Yes, you have to pay capital gains, from a legal perspective. Ethically, we have to pull our weight.”
Really? I recall a story called the ‘little red hen’.
I don’t think the case for redistribution of wealth reduces to ‘we have to pull our weight’. You can also look at Animal Farm, where the horse that was capable of pulling the most weight was over-utilized to the point that he expired.
The case for the redistribution of wealth is made on the basis of other arguments, such as Rawls’ ‘original position’.
I personally don’t find any of them convincing, and I do not see an ethical case for forced redistribution of income at the hands of the state. In fact, many people find taxation to be immoral in its essence, as it is an exercise in force without consent.
#38 Smoking Man on 08.24.15 at 6:48 pm
Buy everything in cite.
SM
…….
That was a fake Smoking Man..
Until i see a camel toe. Stay put…
#4 Jimmy Joe
You already know the answer. Quit trying to piss off Garth
Under the new rules, the fund will be allowed to invest up to 30% of its net assets in domestically-listed shares.
China’s main pension fund holds 3.5tn yuan ($548bn; £349bn), Xinhua said.
=========
“door openers” – rule to allow Social Security money to be invested in financial firms
https://twitter.com/davidsirota/status/634483907614797824
http://www.ibtimes.com/election-2016-jeb-bush-john-kasichs-work-lehman-spotlights-different-revolving-door-2061128
http://www.ibtimes.com/jeb-bush-pressed-pension-officials-behalf-donors-firm-1865946.
Smokey
“Buy everything in cite.”
*********************************
Cite – to quote (a passage, book, author, etc.), especially as an authority:
He cited the Constitution in his defense.
Does this mean I should be purchasing academic research books en masse?
(a) I never predicted US recession, (b) the equity sell-off is hardly related to the Fed. — Garth
(a) http://archives.garth.ca/2008/10/27/painfully-obvious/#comments
(b) Seriously?
Seriously. That column was written in October of 2008 in which I said the US would stay in the red ‘for two to five years.’ I was correct. No recession since then, and none coming. — Garth
Sounds rather like some doubt creeping in concerning Garth’s hitherto unshakeable belief in US exceptionalism and “the recovery”!
There are already too many talking heads who can’t ever see any reasons whatsoever why asset prices might just be excessive.
Or…ridiculous.
Asset prices resetting is a good thing, as I wrote. How hard is that to understand? — Garth
RE: #24 NoOneOfConsequence on 08.24.15 at 5:50 pm
With commodities at such depressed levels…wouldn’t now be the time to buy some choice ETF’s?
Copper has been sliding for the last 4 years. Same with gold. So some of this is nothing new. But other things, like live cattle, are up:
http://www.nasdaq.com/markets/commodities.aspx
Yeah, they called it “bloody Monday.” Well, let me check it out. Still alive? check. Still went out to the ‘Cabin’ for Monday cocktails? check. Still debt free? check. My wife still loves me? check. My son still does too, maybe? check. Portfolio despite the bullshit, and my recent maybe “too soon buying” is still above 700K? check. Did I get all my “buy doers” filled? check.
Well, then. The sun will come up tomorrow, whether I’m there to see it or, not. Will my ‘buys’ make sense three months from now? Most likely so. Is the sky dark at this particular minute? Dam right- CHECK!! Am I worried? No.
Double Check. Why?
I’ve seen this movie in 1974, 1987, 2001, 2002, and 2008.
Same leading lady, same leading man, same leading headlines!
Oh, yeah some shit HAS changed.
Lake Erie was dead. Now good fishing, go figure. Japan was taking over. China was taking over. The U.S. was going tits-up. Buy Gold, Buy Silver.
OK, bought into the world biggest copper, gold and silver mine at under $9.50 a share. Bought more XOM under $70
and some more dividend payers, too on the cheap. No DEBT remember? Still have some dry powder left – probably more than your equity in your house- want to tempt me tomorrow? Be my guest!!
Best holding up 2.9% today!!
How you doing, it’s a buyer’s market FEAST!!! Let’s not be greedy, pigs get slaughtered, yet do be smart!!! Buy right!
Oh, the doomers are stocking up they tell me…
I enjoy this blog immensely and have been visiting for a long time. More for the comments (sentiment) than the articles themselves. However this is the first time though that i feel compelled to write in.
I have a question, Garth are you ever wrong?
I feel you are intoxicated on US data kool aid, and I cannot wait to here the gibberish excuses when the Fed hold in September then October then, oh wait a minute we need to run QE4 in November…
Majority of readers here woke up to bad news this morning, after this dead cat bounce it’s only going to get much, much worse going forward.
Events may cause the Fed to delay, but the US recovery will continue to disappoint you by advancing. — Garth
Today was fun!
Who could resist that open!
10 year and utilities were interesting too!
Yet we Canucks still sleep on the sidewalk around the block for a chance to overbid on a 75 year old fix me.
I’m going to say oil will bottom at @23.68 a bbl. Let’s see if my UCC connection is as good as Smoking Man’s. He’s JD powered i’m Brandy driven… nothin like a raisin…
Shoddy made Chinese stock market collapses.
‘It wasn’t built to last’. – The Onion
http://www.theonion.com/article/shoddy-chinese-made-stock-market-collapses-51163
Kondratieff waves or not, hitting every seven years in general with not only economy, but geo-political consequences:
1901-1902
46% US Stock market value wiped out.
1916-1917
40% US Stock market value wiped out. German, Austro-Hungarian, Russian and Ottoman Empires collapsed. Britain, the world’s greatest empire was almost bankrupt. The beginning of USA rise to world power.
1930-1931
86% U.S stock market value wiped out in the worst financial crisis in modern history.
1937-1938
50% US Stock market value wiped out. Global recession.
1944-1945
End of German Reich and Britain’s hold on territories. Establishment of America as the world’s superpower.
1965-1966
23% stock market value wiped out.
1972-1973
48% US Stock market value wiped out. Global recession. US lost its first war Vietnam…
1979-1980
US and global recession
1986-1987
33% US Stock market value wiped out.
1993-1994
Bond market crash.
2000-2001
37% US stock market value wiped out. 9/11 and global recession.
2007-2008
50% US Stock market value wiped out. Global recession
2014-2015
??????????????????????????????????
Bunk. National economies do not cycle in dog years. — Garth
The stock market always bounces back.
Cuz the rich always get richer.
Easy money.
Three consecutive triple-digit losses for the Dow.
This has never happened before.
I don’t read anything in particular from it, but sometimes, statistics can be so sexy.
Meaningless as indices achieve higher numerical values. Look at percentage changes. — Garth
A government that does everything it can to stop the RE bubble deflating is the true danger; more worrisome than natural market movements. The only thing that tempers this worry is the dread I imagine about how the orangies might make this even worse than the cons.
Mulcair has promised to restore Old Age Security from age 67 back to 65, and increase the GIS payments for seniors.
This election is a slam dunk for the NDP.
Why was the age increased? Careful what you wish for. — Garth
#101 SWL1976 on 08.23.15 at 10:13 pm
Jeezus K-riste on a cracker!
My god, thank heavens you’re on the ball here, SWL1976! It’s a tough job keeping on top of the conspiracies extant and rampant these days, but I’m relieved to see that you’re doing your share… and more!
Jade Helm is indeed sinister. Not only is the ultimate goal of this “practice exercise” to enable the US Federal Government and their fellow-travelers to relieve the entire US population of their guns and their bibles, and pack any resisters into abandoned WalMarts linked together by hundreds of miles of top-secret tunnels; but I have it on good authority that this exercise will also result in the final elimination of every super-sized value meal in every fast-fool restaurant in America!
Yes, SWL1976; we living here in the USA need you now more than ever! God knows, the chemtrails and mind-control satellites have already done enough damage!
Thank God that you’re not deterred by ever wondering how on earth the 490,000 active duty army and 196,000 active duty Marine’s (Semper Fi!) are going to round up 40,000,000 civilian-owned firearms not to mention probably twice as many bibles!
Never mind that those 684,000 active troops will have to face down 13,000,000 Americans legally carrying concealed weapons.
Don’t for one single second be deterred by the fact that with 20,000-odd large towns and cities in the USA, and 294 of those cities with populations over 100,000 and 10 cities have over a million and many have populations over 800,000. Yes, indeed; with 24 soldiers in each of those 20,000 towns and cities, the civilian population obviously wouldn’t stand a chance! I mean, just look how easily we tamed Iraq!
Yes, just like you, I “came across some interesting and disturbing information with regards to the operation itself” and also the use of supercomputers and AI to figure out some of the dirty work.
Yes, SWL1976! Thank God you’re not just standing guard for good ole Canada! You have the cajones to be also standing guard over the entire United States of America as well!
Our thanks! Not just for your valuable contribution to the defense of liberty! Thank you for never letting yourself be distracted by the devastating problems up in Nunavut; where the murder rate makes that of Vera Cruz, Mexico look kindof like Pleasantville. Or trying to make Thompson, Manitoba safe enough so 90-pound male pit-bulls with three testicles can fearlessly roam the streets after dark.
Don’t waste your precious energy protesting the plight of the rising numbers of the unresolved cases of missing aboriginal Canadian women, or that Child Welfare programs for rural Canadian communities have been slashed and pared to the bone.
Yes, those and other problems up there in Canukistan pale in comparison to the grave threats of Jade Helm 15!
I do agree with you that, “It’s time we all take a closer look and question the world in which we all live”.
Just ask the right questions! But in the meantime, I can sleep better tonight knowing that my home here in southern Arizona is just a little more safe with you up there in far-away Canada “Standing on Guard for Me”!
I have an empty RRPS with 42k to fill (TFSA is maxed).
I happen to have the 42 in cash too.
I’m really tempted…
>>At least you’re getting your money’s worth here.
Hi, is this custome service? Here is my gift receipt for today, are exchanges permitted? What’s that? You want my name and email address to process exchanges?
Just heard this was the largest 3 day loss for the Dow-EVER! Report did not say, but I would assume points not percentage. The higher you get the more points a 10% correction covers.
Nobody has mentioned that historically summer months are lighter in volume than other times of the year. Some big players not in the market. Maybe weak longs panicking? I don’t think there has been a market crash in Aug. October is usually the scary month.
Poor S. Harper, he cannot catch a break nohow since he called the election.
54- Alanr
the Fed will raise rates, they have to now if they want to have a shred of credibility. By continually saying they are going to do it, then backing off when the time comes will cause continued market volatility by default. Just by stating they will raise rates, creates volatility and uncertainty. Dragging it out will only make the markets worse.
They might hold in September but I highly doubt it. yes it is a miniscule raise they are targeting but it is the intent / trend behind it that means a lot more. They are past the point of no return and there will never be a “perfect” time to do it.
The Fed also needs to do it since when the economy dives again at some point in our lifetimes, they will have a way to stimulate the economy by lowering rates…like normal. Right now they do not have that luxury so it is imperative that they raise rates sooner than later. It will also help pop ‘n stop the numerous asset bubbles that inflate (including the new real estate bubble forming in the US, junk bond market, equities etc) with “emergency” rates as people chase yields and returns for their cash.
A Fed rate hike must happen.
and to add, this is not a market crash, it is definitely a correction (rightfully so) as Garth indicates.
From no way there was going to be a rate cut six months ago to yet another on the way…..looking forward to finishing our build and getting that new mortgage. Times are tough for those with no planning or those who really believe the sky is falling…
Billions wiped out of personal investments….Black Monday!
So, is this Garth calling the bottom of the metal mining industry downturn?
I sure hope so – we’ve had a rough two years!
Cheers,
Garf
Seriously. That column was written in October of 2008 in which I said the US would stay in the red ‘for two to five years.’ I was correct. No recession since then, and none coming. — Garth
Paragraph 5, sentence 1…
“We should anticipate the US stays in recession for two to five more years.”
Yup. I was right. And now it’s over. Sorry to learn of your reading issue. — Garth
#65 JimH
sarcasm: the last defense of the truly witless.
“At least you’re getting your money’s worth here.”
No doubt about it … we are!
Cheers !!!
(b) the equity sell-off is hardly related to the Fed. — Garth
——————————-
two days ago you said,
“European markets have been on steroids, thanks to central bank stimulus.”
So central banks manipulate (rig) the markets but have nothing to do with any return to reality ?
The Fed has telegraphed for months it will raise rates. There’s no news here. Move on. — Garth
@#60 Re #41 James
1st link, click plz.
http://www.greaterfool.ca/2015/01/04/2015-in-604/#comment-342999
FEDs after money laundering real estate transactions in Vancouver. Story featured in Vancouver Province Newspaper. Realturds run for cover……..
http://www.theprovince.com/business/Federal+audit+takes+money+laundering+real+estate+transactions+Vancouver+area/11311753/story.html
How bad will it get if the NPD gets in?
RE: #64 BC Guy on 08.24.15 at 7:20 pm
Mulcair has promised to restore Old Age Security from age 67 back to 65, and increase the GIS payments for seniors.
This election is a slam dunk for the NDP.
Why was the age increased? Careful what you wish for. — Garth
I don’t think anyone expected the tax cuts to pay for themselves.
Sure, give more money to Boomers. Why not? — Garth
#74 saskatoon on 08.24.15 at 7:35 pm
“sarcasm: the last defense of the truly witless.”
================================
Not that was truly witty! Your mom help you with that?
#65 JimH on 08.24.15 at 7:21 pm
#101 SWL1976 on 08.23.15 at 10:13 pm
Jeezus K-riste on a cracker!
My god, thank heavens you’re on the ball here, SWL1976! It’s a tough job keeping on top of the conspiracies extant and rampant these days, but I’m relieved to see that you’re doing your share… and more!
——
Not the jade helm crap again. Is everyone rounded up yet?
Hopefully this wakes the public up to the fact that the Harper regime is done.
http://www.thestar.com/news/canada/2008/05/27/mp_paid_big_price_for_speaking_out_in_harpers_ottawa.html
Scheduled calls from Ms. Margin, euro and yen reversal, no worries, it’s just your plain old fashioned correction. Emerging markets…pfftt! BRICS becoming roadkill…yawn. Oil at 38, no biggie! I heard it can go down to 20 (on a non-doomer blog, no less) without anyone batting an eyelash.
/kidding :)
#47 smoking man
the camel toe in Vegas, or the camel toe on the charts?
—
Seriously though, balanced portfolio down nearly 7% from highs, but i figure DOW 20,000 before 2017 is over.
That’s less than 500 sleeps away.
If your portfolio is down 7% it’s sure not balanced. — Garth
RE: Why was the age increased? Careful what you wish for. — Garth
I don’t think anyone expected the tax cuts to pay for themselves. <–KommyKim
Sure, give more money to Boomers. Why not? — Garth
Those born before April 1, 1958 will not effected. Those born after 1963 will have to wait till 67 with a sliding scale for those born between 1958 & 1963. So it’s the younger generation that got screwed by the OAS age change, not boomers. The NDP wants to correct this injustice (Or just get elected, take your pick).
Loving my 1 asset strategy today … Tell me my real estate is worth 20% less tomorrow or even 20% more and I couldn’t care less … On Sept 1st I know what my collections are … During even the worst times people need food and a roof over their heads.
I assure you the USA is not raising int rates in 2015 … Won’t be for a LONG time … There are bad times in the pipeline, very bad times.
If anyone is going to walk on Bay Street over the next while, make sure you get heavy duty umbrellas to save you from stock brokers that will start to jump from the windows.
I did predict the stock market will CRASH (“correct” for all you advisors) long before the housing market does … I did predict the 2 consecutive interest rate reductions (even when I was told I am crazy) – I do predict another reduction and no increases on the horizon until at least late 2016 … AND I predict no interest rate hike in the U.S. In 2015.
Hang on to your hats, this is going to a rough ride … And when you over-leveraged Canadians can’t make your payments anymore because you lost your job and failed to make a “rainy day provision” I will be there to make you a VERY discounted cash offer.
Talk to you soon.
Garth, normally I would agree with you, but please take a look at these 2 charts, they have me confused.
-The first one if from the depths of the Great Recession, you will notice that the line on the chart drops straight down to zero on October 2008 and again on November 2008. That’s when the financial system was close to collapse.
http://stockcharts.com/h-sc/ui?s=%24BPENER&p=D&st=2007-01-01&en=2011-01-03&id=p41815326156
Now take a look at tonight’s chart for the same indicator, it again has dropped down to zero.
http://stockcharts.com/h-sc/ui?s=$BPENER&p=D&yr=5&mn=0&dy=0&id=p41815326156
I have no idea what it means, but I sure wasn’t expecting it to drop to zero like that.
No kidding is right. I have written 33 times over my years on this Blog that fear and greed are toxic. They are both part of what are called emotions, and emotions in finance or pretty much anything else will probably ruin your life. Especially for men. No worries for me though, as I never complain, never explain, and always always always put my own Freedom First.
Ok, so Garth and the media are pushing their new talking point: “Don’t panic, everything is fine. Just look at 2008 GFC: people who sold missed on massive gains”. Fair enough. You have to keep in mind what served as the catalyst for these “massive gains”: 3 rounds of QE and ZIRP. The Fed is tapped out now and can’t cut the rates anymore (unless they want to go NIRP)… And 3 more rounds of QE will further undermine US dollar’s reserve currency status. So what sort of ammunition does the Fed have at its disposal to replay 2011-2014 market rally? To me it looks like this asset deflation is going to stick.
BTW, Garth, how about that lift off now huh? Still on track for September, right? ;)
I was calling for a US rate hike in September and despite the negative sentiment, I am sticking to it. While Wall Street is trembling, I still see strength on the ground in my businesses.
The Canadian praries need to worry though. Big revenue drops there!
Thats awesome. Mulcair will increase our taxes now and then give part of it back to us later. In the process the government wastes 50% of our money in the collection and redistribution of it.
The other issue is even if Mulcair gets elected now he won’t be in power 10 to 20 years from now to redistribute the money like he plans. The next government may buy fighter jets with the money and reverse his changes completely. You pay now and maybe get nothing.
The only way to ensure you retire comfortably is to vote in a government that will leave the money in your control. Once the government has it you can kiss most of it good bye.
#69
Hi Cory
With no mortgage debt or loan debt I go to sleep each night dreaming of a return to 5-6 % Int rates, eventually that is where we will find ourselves. Markets determine themselves irrespective of government intervention, this morning was an example of that.
My post was directed at Garth. He is starting to sound like a financial consultant, wait a minute…..
Best of luck
#3 bobb
“…what we are seeing is housing continues to go up…”
I have friends here in BC who wish that were true. Maybe on Vancouver’s West Side. But there are baths already being taken in many other areas. I know people who can’t sell or else lowered their price by 20% to make a sale.
Think Comox Valley, Kelowna or Gulf Islands.
—————————————–
“…and then this past week happens…”
And then what happens? Are you referring to the market correction we’ve been expecting for a couple of years? It sure took it’s own sweet time getting here.
—————————————
“How do suggest best to eventually buy a house, and when?”
When the price of the house in question is somewhere near a sane value based on standard metrics that have been accepted by economists for a hundred years.
I ask you this: If your long lost uncle left you two million tomorrow would you use the bulk of it to buy a tired 60 year old SFH on a city lot in Vancouver with no insulation and single-pane wood frame windows?
Or… would you recognize that to be a fantastic waste of capital and instead invest the money as per Garth’s usual recommendations, take the income that it would generate and rent something comfortable with lots of extra to spare?
I KEEP PRESSING THE BUTTON, BUT I DONT HEAR ANYTHING
WHATS GOING ON?
Such down days are perfect for tax-loss harvesting, as well as switching your ETF choices without getting a tax hit. I did so when I sold my VCN and move the proceeds to HXT.
@#79 Young and Foolish
“How bad will it get if the NPD gets in?”
++++++++++++++++++++++++++++++++++
Well, first.
The socialist zombies will eat your brain.
Then they will eat your wallet.
Then the politically correct will outlaw your insensitive thoughts.
Then the taxman will take 95% of your pay.
Everyone will be able to retire at 40 …..Viva Venezuela!
BUT.
Most Importantly.
Harper will be gone…….and you will only have to suffer through 5 years of fiscal ineptitude as opposed to the last 10 years of fiscal depravity.
On March 29, 2015, I stated the following on this very blog. I couldn’t have been any more clear. History shows that I was correct:
Canadians are in for a world of pain in 2016 once interest rates start to rise, and your housing prices fall. Good luck with that!!!
Leviticus 18:17 “Do not have sexual relations with both a woman and her daughter. Do not have sexual relations with either her son’s daughter or her daughter’s daughter; they are her close relatives. That is wickedness.”
Americuh!!! God bless the U. S. of A.!
#65 JimH
#101 SWL1976 on 08.23.15 at 10:13 pm
Jeezus K-riste on a cracker!
Something I mention bother you?
I am not being patriotic to any one country there Jim. Rather I am a citizen of the world who can see how corrupt our current system has become on both sides of the border. One side just happens to have the most powerful military in the world build on the proceeds of most of the worlds riches.
No need for further conversation here as I clearly understand your indoctrination has been a stunning success
Enjoy the illusion Jim
#98 Leroy Washington
Garthius 19:13
“Clutter not a gentleman’s blog with irrelevant scripture for that be the way of the tedious simpleton”
Now I remember why I don’t like Bubble Tea.
Stocking up on some bargains, my rrsp is invested for the year, and tomorrow will consider some more under my husband. Some of the US dividend ETFs are too tempting.
Also, I have decided to keep the bond at 9% bond with current yield at 65%. I don’t see rates going up anytime soon. Mine should provide a little be more yield.
Seeing the 1000 point drop at 9:30am took my breathe away. I hope that was a historical moment I can say I lived through to my future financial wiz grandkids!
People: YOU’VE GOT TO GET A HOLD OF YOURSELF….
https://www.youtube.com/watch?v=qvPugcb7QGE
Garth, with all due respect: if you still are going to insist that there is no seven year cycle, then clearly you are willfully blind. Wait until September. Seriously.
Seriously. How can you believe such hokum? — Garth
#4 Jimmy Joe
Two Maple leafs
No capital gains tax and ……
I will give you $1500 each for your coins .
If oil is $38 how come gas is still way over a buck a litre? Oh well at least diesel is below gas again which is how things should be.
Blew 100 K in buying stocks today – PG, XOM, MRK, WMT. Hope you are right Garth – and they snap back.
If I hear the term “Black Monday” one more time, I’ll throw my TV out the window. We’ve seen China’s numbers falter for months. Ditto the commodities. This is not the derivative timebomb that the doomers are predicting (not today, anyway). I don’t see a Lehman Brothers. Nor do I see irrational speculation by retail newbs.
I measure the state of corporate profits by the size of my stockpile of face cream samples. I currently have more crap to put on my face than I have face. Sure, it’s not my haul from 1999, and I may not see that kind of haul ever again, but it’s not 2002 or 2009 when my stash was nearly empty.
dear god. Will here. please allow the tsx to decline another 400 pts. tomorrow. and another 400 pts the day after. so i can load up on cheap and cheaper securities. so i can have lots and lots more dividends that i can distribute in the future to people who didn’t understand what you meant when you allowed/caused corporations to come into being.
Re: #98 Leroy Washington on 08.24.15 at 8:39 pm
I also remember you snagged one of the first posts (the first reply #1) of the night on this blog.
I appreciate the reason and calm you’re trying to promote, Garth. Today was interesting to watch, but in my decades-long investment horizon may not even merit a mention! (Though “DOW -1000” is a nice, round number.) I did do a little buying, am now not holding too much cash. :-)
It’s getting real in Alberta:
http://www.financialpost.com/m/wp/blog.html?b=business.financialpost.com//news/energy/as-oil-plunges-to-us38-24-mood-in-alberta-is-like-a-boxer-taking-too-many-hits
Meanwhile in cloud-cuckoo-land:
http://www.theglobeandmail.com/report-on-business/economy/housing/the-real-estate-beat/canadian-consumer-confidence-rises-on-real-estate-optimism/article26079871/?service=mobile
Ok hell from my on line broker mostly did not work as normal. If if did I could of made money.
why why. ect.
Seriously. How can you believe such hokum? — Garth
Simple. Because it indisputably has occurred – and is simply happening once again.
#103 Bassrage on 08.24.15 at 9:07 pm
Garth, with all due respect: if you still are going to insist that there is no seven year cycle, then clearly you are willfully blind. Wait until September. Seriously.
Seriously. How can you believe such hokum? — Garth
**********************************
The 7 year cycle is pretty obvious, whatever you want to attribute it to, it’s there.
So when it happens again are you going to admit it looks like a true, dependable cycle or are you going to insist on being a tin foil hat wearing coincidence theorist?
:)
There is no cycle. Go to bed. — Garth
“…my rrsp is invested for the year, and tomorrow will consider some more under my husband…”
Haha… :)
#94 Mister Obvious on 08.24.15 at 8:33 pm
“I ask you this: If your long lost uncle left you two million tomorrow would you use the bulk of it to buy a tired 60 year old SFH on a city lot in Vancouver with no insulation and single-pane wood frame windows?
Or… would you recognize that to be a fantastic waste of capital and instead invest the money as per Garth’s usual recommendations, take the income that it would generate and rent something comfortable with lots of extra to spare?”
+1 – so ‘obvious’ yet so true! I assume everyone is doing number #1…
Joking ;-)
China down over -6% at one.
Don’t Panic. Hold for the long term.
Hearing newswire reports that Circuit Breakers will be activated at opening of the NYSE tomorrow morning. Dow and S&P will be -10% at open. Damn Algorithms.
Dow futures are up 230 points. — Garth
Not sure why some posters think that there’s a correlation between blowing some froth off the stock market and the Fed raising rates.
My U.S. properties have never done better and rents are rising. Don’t see any issue with the U.S. Economy.
Must suck being a wage slave and not understanding how things work.
China stock market panic shows what happens when stimulants wear off
http://www.theguardian.com/business/2015/aug/24/china-stock-market-panic-stimulants-sell-off-financial-markets-quantitative-easing
Garth, just a short comment on yesterdays post:
“If you’re silly enough to own stocks, sell the losers instead of hanging on to preserve dignity.”
I agree, after some bad experiences. But also think about averaging out. You don’t have to dump all at once. Dumping over a period of time can be better than dumping all in a single trading day. Sorta like averaging in, but different.
I wouldn’t watch the Asian market before bedtime unless I had I really good homebrew within (half) arm’s reach. Kudos to the poster who said a while ago: “I’m learning how to drink”, because it really takes a great amount of practice. And if the market somehow goes up unexpectedly, always keep in mind, the most violent up moves are not made in an expansion.
Wow. Bars. — Garth
Love you Garth. Thanks for giving me my daily chuckle along with your sage advice.
JimH: Yes, SWL1976; we living here in the USA need you now more than ever! God knows, the chemtrails and mind-control satellites have already done enough damage!
pretty funny
(a) I never predicted US recession, (b) the equity sell-off is hardly related to the Fed. — Garth
Garth, kind of reminds me of that saying from the renowned economist Samuelson…something like “Wall Street indexes predicted nine out of the last five recessions!”
So don’t sweat it if you get it wrong a few times, even the numbers lie sometimes!
When I get it wrong, I’ll tell you. But nothing above qualifies. — Garth
#3 bobb on 08.24.15 at 5:25 pm
———————————-
The answer is that its a personal decision and you have to weigh all the factors in your life. When I bought, real estate was outpacing inflation by 5% per year, so by saving money each month for a down payment made absolutely no sense, because we were losing ground. At least that has changed, real estate seems to have slowed to about the rate of inflation, so at least those saving for a down payment now arw not losing ground to the market.
My advice is to try and have at least 10% down (20% would be better) and ensure you can afford payments at higher rates as well as maintenance and repair bills.
Garth:
While it is too late for your pathetic yet mildly worthy efforts to enable this Boomer to avoid penury in my retirement, you will greatly assist my 20 year old daughter.
She has an appointment with [email protected] on Wednesday to open a TFSA and start with the $3K she scraped together on her $12.50 per hour summer job. I am feeling proud and perhaps she has timed the market a bit.
She is a poli sci student at uni and as such has not succumbed to the resignation that living brings. So, she leans left. She will probably vote NYPD this fall.
I have thrown her out of the nest on investment matters (so she can avoid my idiotic advice) and handed her over to your blog. Be nice. She and I will discuss your missives often. Please stifle the talk about sex. Thx.
Capitalism explained…in the case of the US its funny and yet extremely accurate also.
http://www.tickld.com/x/capitalism-explained-this-is-so-accurate-it-hurts
Enjoy
#105 nonplused on 08.24.15 at 9:09 pm
————————————-
Here’s your answer, although the title says the dollar is to blame, the article outlines how refineries are gouging consumers by increasing margins to record levels.
http://m.thestar.com/#/article/business/2015/07/22/low-canadian-dollar-to-blame-for-high-gas-prices-analysts-say.html
Garth
Although you are against timing the markets, buying at opportune times on dips/plunges is obviously a factor in generating better returns…so is this a buying opportunity, and what do you recommend??? ….bearing in mind we may see a few dead cat bounces over the next few days/weeks….
DELETED
garth your so finished the market is done this is beginning of the end
What? Again? — Garth
#128 Bottoms_Up on 08.24.15 at 10:40 pm
#105 nonplused on 08.24.15 at 9:09 pm
————————————-
Here’s your answer, although the title says the dollar is to blame, the article outlines how refineries are gouging consumers by increasing margins to record levels.
http://m.thestar.com/#/article/business/2015/07/22/low-canadian-dollar-to-blame-for-high-gas-prices-analysts-say.html
…….
Stop reading MSM we have five banks , 2 1/2 air lines, an insurance industry that ouns the ontario libreal party.
A renegade cowboy real estate industry.
If you want to know whats what…
Fellow the drunk, the great smoking man..
so i suck at spelling
I have a Phd in Herdonomics….
I’ve got the only one….
Dr Smoking Man
#130 Smoking Man on 08.24.15 at 11:04 pm
DELETED
You bought a bike didn’t you. You let the link fly a few years ago.
Man your mood swings…. Getting worried about you.
You’ve gone Establishment…
Snap out of it……
Garth,
I wasn’t worried till I read this….
http://www.mirror.co.uk/news/uk-news/stock-up-canned-food-after-6313506
People should stock up on canned food and bottled water to avoid fallout from another stock market crash, according to a former advisor to Gordon Brown.
This is waaaay more serious than previously thought…
SWL1976 — When the cat (Obama) is away, the mice (investors) will play, so just asking: Would Monday’s sell-off be a cover for this? Note the date: “They’re on their way to the UN Small Arms Conference, to be held in Mexico City on August 24 2015.” Or check out this link for further info. The UN – A21 – TTIP – TPP and TISA again.
#27 Admirer on 08.24.15 at 5:54 pm — “Tonight’s post is eerily optimistic”
As compared to this former Brit politico’s adviser, yes it is! It stinks Further on the trade deals; The difference between Bush and Trump.
Glad I followed Garth’s advice on this blog way back when. Diversity, balance, geography are limiting my (paper) losses in all this mess. It really does let me sleep better.
Just finished entering all of the chart data into my computer and what the computer spit back out is NOT pretty. All indicators are deeply red, not one showing that it might be a time to buy tomorrow. There probably will be a bounce up tomorrow but it probably won’t last very long.
Just in case anyone is planning on buying stocks tomorrow; my timing system is saying “Don’t”.
the Fed rate hike, if it happens, will be remembered as the ‘great mistake’
maybe it is the catalyst to get the show rolling
it would make a good backdrop against which the elites could portray an evil criminal western banking cartel
we are gonna find out I guess, but really we should have known
also, there is no ‘end’
think of it this way, the movie we are in is ending (the ending is not written yet) and when it ends the sequel starts right away, no break
there is no apocalypse, just resetting the field
unless you can put together the Law of Attraction and how it is used against you…you can literally attract whatever scenario you want
Faz, spxu, dxd. Who knew?
;)
118 Leo Trollstoy on 08.24.15 at 9:36 pm
Not sure why some posters think that there’s a correlation between blowing some froth off the stock market and the Fed raising rates.
My U.S. properties have never done better and rents are rising. Don’t see any issue with the U.S. Economy.
Must suck being a wage slave and not understanding how things work.
===
Good to see that at least you know it all, based on your “U.S. properties” and “rents”.
They sure represent the “U.S. “Economy” as a whole and it makes you the Lord master “Economist”.
Yet, you manage to sound like one of Leo’s mujiks.
RE: #92 BS on 08.24.15 at 8:29 pm
This election is a slam dunk for the NDP.
Thats awesome. Mulcair will increase our taxes now and then give part of it back to us later.
The taxes YOU pay TODAY pay for the OAS collected by the boomer aged 65 today. Wonderful Harper and the CONs say that you get to wait an extra two years to collect OAS that will be payed by the taxes that your children/grandchildren will pay.
#126 Washed Up Lawyer on 08.24.15 at 10:34 pm
‘… has not succumbed to the resignation that living brings…”
————–
Great line.
#126 WUL
Garth doesn’t talk about sex. Only lust filled moist virgins. And the Amazons. Just don’t tell Dorothy. (I’m kidding. Dorothy knows. She is Head Amazon).
One thing that has become abundantly clear here in the comment section over the last few days is that many have no idea what their risk profile looks like, have never even bothered to test one up front, and so we see much bed-wetting even in a mild correction.
Looks like many were panicing at 5% and lots more were heading for the lifeboats at 10%. I guess if you’ve never considered what your risk tolerance is, then the market will just eventually di it for you.
Why is it that the stock market is the only market we know where when everything goes on sale everyone runs for the doors?
Why do so many people want the world to be ending?
I’m still fucking mad at myself for not hanging on to more cash.
I read this great interview from the former PIMCO CEO (a bright guy) and an offhand comment about being in all cash resonated. I should ahve listened:
http://www.ocregister.com/articles/pimco-656718-erian-people.html
Sounds like QE getting pushed to March.
Markets are broken.
One of your best posts.
Calming, reassuring and facts based.
Next up: dividend cuts. And about time.
Seriously though, balanced portfolio down nearly 7% from highs, but i figure DOW 20,000 before 2017 is over.
That’s less than 500 sleeps away.
If your portfolio is down 7% it’s sure not balanced. — Garth
—-
Well, in support of earlier poster, I got into the market in March or April, and currently I stand at:
prefereds & xre ~ -16%
vxc -6.6%
vcn – 13%
vab – flat
but unfortunately, I bought 20%vab, 20% prefereds.
So down quite a bit, and foolishly bought preferred without understanding of what makes them go up or down… still can’t understand why they are tanking if dividend’s haven’t gone down, or rates up. Completely baffled.
CAD rate going to 0 while currency depreciates rapidly and we have inflation picking up speed?
Where is the Poloz guy and what is he doing besides kissing dear leader’s behind?
It’s not panicking if a 900 kph tsunami is beading down in your direction.
Fly… You fools!
Fly !
Hey, all you guys that can predict the future – when are the prices of Porsches going to collapse? I need a new ride. Thanks.
China cuts rates again….and bank reserve ratio.
Currency wars continue…..
Nothing to see, move along, move along..
Well I didn’t see an August correction coming so grin and bear it. Garth is right, the U.S. is still improving and we can expect the stock market to recover and slowly gain. I also recall a blog dog forecasting a quick return to $100 oil last spring. Garth called him a sucker. Sure enough the prospect for oil is bleak.
Garth has also predicted the Fed would raise rates in September and the CAD would fall to 70 cents. I suspect the timing on this prediction should be amended.
I would have to define the actions, or more appropriately reactions, of North American stock markets yesterday as bizarre “involving sensational contrasts or incongruities”
A collection of talking heads, masquerading as experts, could not agree on what was causing this ridiculous yo-yo but were unanimous in agreeing that such wild volatility was the new normal.
I shook my head in disbelief and wondered if passengers on a plane that lost and gained 10,000 feet of altitude without input by the pilot would remain confident if the pilot stated that he had no idea of why the plane had behaved in such a bizarre manner but whenever it had happened in the past he had always managed to regain control.
In the real world the ability to predict what might happen in the future is viewed as a good thing. The failure to understand why change is occurring is viewed as a bad thing.
In the bizarre world however volatility and uncertainty caused by circumstances no one seems able to predict or control is viewed as normal. The failure to buy a ticket on a plane that has a history of gaining and losing altitude in an uncontrollable manner is viewed as a bad thing.
Am I the only person on earth who views unexplainable volatility as a sign that something might be wrong with the system.
It might be better if the faith investors seem to have in all stock markets was not ‘blind’ faith.
Reality is not created by confidence, it actually exists!!
@Londoner:
“Hey, all you guys that can predict the future – when are the prices of Porsches going to collapse? I need a new ride. Thanks.”
Porches, which are money pits that require constant maintenance, are always in demand, and will therefore never collapse in price, unlike stocks, especially large cap blue chips that provide steady sources of dividend income, which go out of fashion from time to time. Such is human nature.
Dr. Smoking Man: I’m studying for my bachelors in herdonomics. How’m’I doing?
#149 Not balanced, garth says
So down quite a bit, and foolishly bought preferred without understanding of what makes them go up or down… still can’t understand why they are tanking if dividend’s haven’t gone down, or rates up. Completely baffled.
___________________________________________
They’re falling because dividends will drop unless rates rise. If you’re worried about the short term valuation of your portfolio then you really shouldn’t have invested 20% of your savings in something you don’t understand.
«Fourth, the commodity collapse is already overdone.» – Garth
Not so sure about that, commodities and oil may be a bit cheap now but they were extremely expensive before. There is still plenty of room to overshoot.
«the equity sell-off is hardly related to the Fed» – Garth
Don’t you think the perspective of higher rates makes the markets a bit nervous and more vulnerable to the kind of panic we saw the last two days?
The world economy is transitioning, if you understand why and how you’ll be just fine. You could do much worse than to follow Garth’s investment advice, you could do better too…
Garth et al:
I thought this was interesting…
http://money.cnn.com/2015/08/24/investing/stocks-markets-selloff-circuit-breakers-1200-times/index.html
Amazing story…historical….
« the commodity collapse is already overdone.» – Garth
Even if prices have bottomed the consequences (for producers) are still far from the bottom (Eh Canada!)
#123 45north
JimH: Yes, SWL1976; we living here in the USA need you now more than ever! God knows, the chemtrails and mind-control satellites have already done enough damage!
pretty funny,
It would be a whole lot more funny if there wasn’t some truth to the statement.
As of 8 a.m. Tuesday, DJIA futures are around +500. This should be an interesting day on the markets. I have about $10K USD to put to work today (RRSP contribution) and the buffet of choices is most appealing. Probably will go VGK (Europe is paying nice dividends these days), VIG or good ole VTI.
Wasn’t yesterday the time to buy? — Garth
#156 Renter’s Revenge!
But this article says that the early 90’s classic car price crash was caused by the Japanese stock and property market bubble:
http://www.carmagazine.co.uk/features/car-culture/classic-car-prices-bubble-is-now-the-time-to-invest-in-an-old-car/
I would really like a 964 RS :)
I heard FED changed their mind on raising the credit rate… at least not in September… In the meantime CAD is sinking without any FED raises..
The Fed has made no announcement on rates. The C$ is a victim of cheap oil, not US monetary policy. — Garth
Wasn’t yesterday the time to buy? — Garth
Yep. I bought in on some of the Apple insanity yesterday morning (only a couple of Gs, sadly). But the RRSP money only became available as of this morning. The rally may fade as the day progresses and traders cash out their wins, so I’ll wait around a bit. But whatever. I have a 25 year time horizon and am a dividend-oriented guy so blips don’t matter.
City of Toronto expects $55,000,000 surplus this year. This means property taxes will probably be increased modestly next year. Makes it lot easier to rent out space in Toronto as a landlord. Things just keep getting better and better for property owners in Toronto. With 100,000 increase in population each year that’s 30,000 new places to live each year needed just to keep pace. Makes condo back log look like a blip not a bubble. In ten years I am sure well see prices up four times again for SFH.
Dammit, I’m MAD AS HELL!!!!! Why? The best sales in the stock market are over as a rally is going on now. Luckily I managed to scoop up some good deals yesterday afternoon before the markets closed. While the BEST deals were on, I was in transit and away from a computer. You are supposed to buy low, isn’t that right?
Its simply astounding watching the OPEC nations running around like rats at a garbage dump. Each one is being told by the head rats to wait it out and hold back. They can’t help themselves and they are all in. Thanks Saudi Arabia and much thanks to the Chinese. Best entertainment in a long while. While Canada may not be as diverse as other countries in our economic output it has to hurt everyone from Venezuela through the middle east to mother Russia.
#153 Smoking Man on 08.25.15 at 7:31 am
China cuts rates again….and bank reserve ratio.
Currency wars continue…..
Nothing to see, move along, move along..
____________________________________________
Wait, wait, wait, here it comes. That sound was a dollar bill hitting the floor. Currency wars start real wars. Welcome back my friend to the show that never ends.
https://www.youtube.com/watch?v=UeQsZOQqO6I
#155 Llewelyn
If you take a step back and look at historical volatility, you’ll see that spikes occur at market tops and bottoms and also when prices are locked into a trading range, such as we’ve been in since about February when market momentum stalled.
Volatility is to me a measure of uncertainty, and there is lots of that around, as you know.
I find it odd that there is even concern about it, and that the recent volatility spike is in no way “inexplicable” as you suggest. BTW, comparing the markets to an airplane is a bad analogy; there is no market ‘Pilot’ at the controls, even though some would like you to think so!
In fact, until last week, CBOE volatility (VIX VXX) was actually in the neutral range until Aug. 19th. If anything, markets were overly complacent even as declining issues began to outnumber advancing, demand for junk bonds was increasing, the 52 wk lows began to outnumber the highs, and the put/call ratio was moving up, and commodities slid lower. These are all signs that the rally was getting long of tooth. There was increasing chatter about a coming correction that was hard to miss.
China has been the catalyst, IMO. The Chinese economy is the least transparent of all the leaders, and no one, literally nobody, really knows what’s going on there. China has pretensions about becoming a global reserve trading currency, yet confidence in the Yuan just took a huge hit. After months and months of artificially propping up the Yuan, the Chinese government suddenly gave it a 2% haircut, then let it slide down another 2%. Chinese market intervention has been a disaster, again after months (years now) of encouraging the mother of all stock market bubbles.
China still has a very long way to go before it will gain much in the way of global confidence.
As the S&P500 stocks ‘depend’ on only about 15-20% of total revenues on China-linked trade, I think it will take the correction in stride.
Just my 2-bits worth.
All the doomsayers and cry babies gone into hiding.
Or back to being wage slaves.
Don’t quit your day jobs fellas
#47 Smoking Man on 08.24.15 at 6:53 pm
#38 Smoking Man on 08.24.15 at 6:48 pm
Buy everything in cite.
SM
…….
That was a fake Smoking Man..
Until i see a camel toe. Stay put…
——————-
Markets are back up – should have read tea leaves instead.
#106 SENTA
I’m right there with ya Bro. Same timing, same stocks.
We shall be fine, but it might take a couple of weeks…
3106 SENTA
I bought no WMT…. COST instead my preference.
Londoner:
“But this article says that the early 90’s classic car price crash was caused by the Japanese stock and property market bubble
I would really like a 964 RS :)”
Hmm, I think you might be a couple of years ahead of me in the bachelors program. I hope for your sake that I was completely wrong about the price of Porsches :)
In all the papers today “the government steps in to assure investors” …. you know, the investors in the free market.
The government in China, where markets have never been free of intervention. — Garth
OK guys, coast is clear. Jump back into the stock market!
Steve met poloz yesterday, what do we think he asked him to do?
1. Raise rates, to boost the dollar so Steve can look good?
2. Lower rates again, to try to get mortgage holders on side?
My guess is #1. It’ll be too late in election to hurt oil exports any more.. And will cause a good blip in the exchange rate.
So that’s me calling the next boc rate announcement.
“Why is it that the stock market is the only market we know where when everything goes on sale everyone runs for the doors?”
Because to most people, the market is an abstraction, like a casino, and not really a place of investments in enterprise.
Trading was halted 1200 times yesterday.
http://money.cnn.com/2015/08/24/investing/stocks-markets-selloff-circuit-breakers-1200-times/index.html
The house never loses, stop betting against the machine.
Circuit-breakers date back to 1987 and are a valuable device to help protect investors. — Garth
OMG … the Liberals have resurrected Paul Martin!
“Markets determine themselves irrespective of government intervention, this morning was an example of that.”
Oh yeah?
Conspiracy theory alert #1:
The 1% feels left out from sales in the stock market so they manipulate the game and prey on the dumb and desperate to give up their gains. Prices drop due to sell offs, the 1% snatch them up and make a killing as things get back to normal.
If you are not the 1%, just ride the tide….don’t fall into their trap.
Damn. How did you know we 1%ers have a weekly conference call? — Garth
fifth: stop holding your breath for rates to rise. My call is stand pat.
Of course they will rise. September, October, December. Same impact. — Garth
#149 re: preferreds
Yes, it is frustrating to see how preferreds are getting oversold. I bought more yesterday. ZPR are reset preferreds and will gain when interest rates go up. DIY investors don’t understand their function either and they were getting hammmered, especially when we had the 2 reductions in canadian interest rates. Patience….
“The government in China, where markets have never been free of intervention. — Garth”
What about QE? Or does that not qualify?
It ended in October, 2014. — Garth
#180 Old Soldier on 08.25.15 at 11:13 am
Circuit-breakers date back to 1987 and are a valuable device to help protect investors. — Garth
What!? I thought the Plunge Protection Team (PPT) was suppose to do that!
Back in 2008 was wondering what happened to them (ditto 2000). As the markets were in major panic and kept dropping, I thought, “Now guys!… Hey where is the PPT? …Hello, is anyone there?”
———————–
#183 Dual Citizen In Canada on 08.25.15 at 11:44 am
Damn. How did you know we 1%ers have a weekly conference call? — Garth
AHAH!! Truth is out! Garth is a One Percenter disguising as common folk. That explains why he charges such an exorbitant fee for this pathetic financial blog.
the finger wagging on imminent rate rises have been going on for years. what makes it such a sure thing now?
Just a suggestion but maybe the only improvement going on in the US is the smoke and mirrors game
Our bank is licensed by the Pentagon’ -????
An Interview With Two Fraudsters
July 09, 2015 by David Marchant
36 minutes and 44 seconds to spare, I encourage you to listen to the recording. It’s both entertaining and insightful into how the minds of fraudsters work. If you’re pushed for time, you might want to fast-forward to the 27 min. 20 sec. mark and listen to the last nine minutes, when Zumbe utters some of his most colorful claims, threats and insults.
http://www.youtube.com/watch?v=NPnc_pgsK-I
Jul 9, 2015 – Uploaded by OffshoreAlert
#171 Leo Trollstoy on 08.25.15 at 10:13 am
What’s really funny is that people like you (the entitled and smug) are creating an absolute disaster. What’s more you fail to recognize just how close it is and how it will affect you. Carry on though, folks such as yourself will be crying the loudest when things don’t go your way – same as 2008. Save us! Save us! Eventually the masses won’t be able to save you from yourself though.
Exponential curves don’t jive with the laws of thermodynamics.
It ended in October, 2014. — Garth
…and then what happened?
Central Banks Have Become A Corrupting Force
http://www.paulcraigroberts.org/2015/08/23/central-banks-become-corrupting-force-paul-craig-roberts-dave-kranzler/
“If central banks purchase stocks in order to support equity prices, what is the point of having a stock market? The central bank’s ability to create money to support stock prices negates the price discovery function of the stock market.”
Central banks have become a stabilizing force. Life is improved because a globally-coordinated monetary policy is starting to emerge. Humanity will be better served with a moderation of the boom-bust excesses of unchanneled capitalism. –Garth
Bay st. Layoffs: broker closure. Oil rout.
From BNN: Edgecrest Capital closing up shop. 23 let go.
Central banks have become a stabilizing force. Life is improved because a globally-coordinated monetary policy is starting to emerge. Humanity will be better served with a moderation of the boom-bust excesses of unchanneled capitalism. –Garth
Life is improved for whom? For you, ok, but have a look around man. It’s a disaster unfolding for the majority of people around the world, all so the rich can get richer. This is what happens as civilizations collapse though, it’s all well documented. Keep telling yourself whatever story you have to though.
Civilization is not collapsing. Fact. — Garth
#170 Jim H
A very interest two bits worth. Thank you.
My airplane reference was focussed on how passengers might react if the plane they were travelling in was rising and falling without a reasonable explanation as to the cause. Telling them it always does that might not alleviate anxiety.
The observation that the stock market has a history of fluctuating wildly does not really convince me that all is well. Experts may be able to attach a measure of blame after an ‘event’ occurs but I would feel more confident if human greed was not always the proven cause of past ‘events’ and if billions of dollars weren’t routinely transferred into the pockets of financial institutions.
On that note I wonder why financial advisors continue to promote ETF’s in spite of the fact that nearly ETF with significant trade volume has lost money in 2015. When I ask for an explanation of why 2015 is such a bad year for ETF’s the only answer I get is ‘look at the 5 year average’. A pretty weak foundation for the future if you ask me!
I get that equities have increased in value after every correction but cannot help but wonder whether rapid changes in the global economy since 2010, China for example, have initiated a paradigm shift that we might not be prepared for.
Accepting that current volatility is nothing more than part of a historical pattern of ups and downs undermines the importance of evaluating the root cause of volatility. As I have mentioned before I investigated why mortgages were being issued to families without incomes in Philadelphia in 2008 and did not like what I found. Six months later the whole house of cards collapsed.
We should always try to determine the fundamental reasons behind irrational activity.
Central banks have become a stabilizing force. Life is improved because a globally-coordinated monetary policy is starting to emerge. Humanity will be better served with a moderation of the boom-bust excesses of unchanneled capitalism. –Garth
————————
Banking has nothing to do with humanism.
Globally-coordinated monetary policy is not really needed, I thought efficient markets are the core of capitalism.
Screwing with the price of ‘money’ (aka interest) is not good.
Paul Craig Roberts is a very honest gentlemen, secretary of treasury under Reagan and the author of supply side economics that lifted US out of the recession
in cooperation of another great gentlemen – Paul Volker, the last big chairman of the Federal Reserve, he introduced interest rates of 18 + %.
Looking for the next big Fed Chairman that is not counterfeiter.
#178 Blobby
Everyone’s in debt to their houses. Devaluing the dollar and protecting the housing industry is what Harper will do. He doesn’t have to keep it running much longer, just enough to get elected.
The crap dollar could turn Toronto into Silicon Valley North. It built the film industry here in the early 00’s
I despise Harper’s policy, it punishes savers, but there’s an insane consistency to his logic, even if the party dogma pounds the idea of fiscal responsibility, when in reality they’re just pandering for votes.
Civilization is not collapsing. Fact. — Garth
Not immediately.
But screwing savers at the expense of the irresponsible debtors to stimulate consumption is not the best recipe for long term economic recovery. The chance of monetary policy backfiring with the rampant future inflation is not to be ignored.
So far we are lucky that the herd (sheeple) is stupid.
Garth is there a reason why you “continually” refuse to post media posts which completely refute your claims around foreign Real Estate money laundering? Or do you just not like being called from time to time? I see you allow all kinds of other “goofy stuff” here. But Vancouver Sun posts are DELETED. Gee I wonder if you will post this.
Not interested in hosting an anti-Chinese, anti-immigrant, they’re-all-thieves, stealing-our-houses blog. If you are, go ahead. — Garth
We should always try to determine the fundamental reasons behind irrational activity.
Fear and greed.
Been known for a millennia
Saudi Arabia is smoking through their cash reserves at $10 billion a month in to pay the bills. Even borrowing money for the first time in some many years.
How does it feel to be bleeding cash Mr Middle East?
Well, how does it feel punk!
#190 Godth on 08.25.15 at 1:01 pm
It always goes our way.
The rich get richer. Always.
Since the dawn of Man.
Just accept it.
Civilization is not collapsing. Fact. — Garth
Oh well, ok then – if you say so.
You don’t have to convince me but you better explain that to people in Greece, Portugal, Spain, Italy, Romania, Bulgaria, Ukraine, etc.
Even the wealthy Euro. states like Germany are being swarmed by refugees now (from the resource wars), and it’s just the start. Germany will have to accommodate 800 000 this year alone.
So then you can explain how civilization hasn’t collapsed in Iraq, Afghanistan, Yemen, Libya, and is the process in Turkey, Syria etc.
Then there’s Detroit, Illinois (drowning in unpayable debt), California (where’s the water?), etc. etc., etc.
Of course there are many hopeful stories being told but nobody really has a plan to make the rubber meet the road.
Then you can explain it to Brazil (where’s the water?), Argentina (where’s the resource income?) etc., etc.
Canada is screwed too as you acknowledge but we have a distance to fall before it hits home. Russia and China (oh China how screwed are you?) are prime for beating on in the west but everyone needs an evil other to feel better about themselves.
Of course Africa is perpetually screwed, nothing new.
But hey, you can fill your hummer up relatively cheap, houses always go up and the stock market is robust and healthy.
Carry on, nothing to see here. It’s the story of Pollyanna and Casandra. Pollyanna wins every time in the short term anyway.
You’re a little short of friends, I’m guessing. — Garth
The Fed has made no announcement on rates. The C$ is a victim of cheap oil, not US monetary policy. — Garth
Looking forward to the CMHC bomb to explode and trigger our own ‘official’ QE, it will be monstrous to account for the huge credit and liability problems of government and population, CAD will be destroyed.
So far CAD has accounted for very little other than oil prices slump and the idiotic BOC policies with the cuts of interest rates. Once the rate hits zero (soon) we will get our own QE. Whoever takes over from Harper would be toast.
#198 OXI in GREECE !! on 08.25.15 at 1:45 pm
Garth is there a reason why you “continually” refuse to post media posts which completely refute your claims around foreign Real Estate money laundering? Or do you just not like being called from time to time? I see you allow all kinds of other “goofy stuff” here. But Vancouver Sun posts are DELETED. Gee I wonder if you will post this.
Not interested in hosting an anti-Chinese, anti-immigrant, they’re-all-thieves, stealing-our-houses blog. If you are, go ahead. — Garth
<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<
So in this case – even if the Federal Govt is involved – your not interested in posting information? I promise to never "try" to post another Vancouver Sun or related link if that is the case. You will have made your point on your views and moderation here.
“Globally-coordinated monetary policy is not really needed, I thought efficient markets are the core of capitalism.”
Apparently, this is no longer the case, and it is becoming more and more obvious to more and more people. Could it be for the better (as Garth suggests)?
@Leo Trollstoy, post #201:
Yes, that’s true, but YOU can fight back at those greedy fat cats stealing away your wealth if you’re not in the top 1 or 2% of wealthy people. How? Simple, you go on a buying binge, scooping up assets when they are on sale like they are now and were even more so yesterday. It’s the one chance we lesser wealthy people have to accumulate wealth. Wow, Robin Hood is alive and well in the 21st century, stealing from the rich and giving to we poorer people!
“So far CAD has accounted for very little ….. ”
Unfortunately, our dollar is not a “global currency” like the US dollar or the Euro. Will we see close to par in the near future again?
You’re a little short of friends, I’m guessing. — Garth
hahaha, an ad hominem – quelle surprise.
I have all the friends I need, thanks for your concern though. Believe it or not there are a few people around that can handle something that approximates “reality”. I have the odd good discussion (even with strangers) and a few close friends, even in redneckville.
Most people are stuck in the cult of positivism though, you’re correct. Smiley faces everywhere. :) :) :) :) :)
There’s a sale on at Walmart, it’s 2 for 1!
#194 Llewelyn
“We should always try to determine the fundamental reasons behind irrational activity.”
==============================
Sure; but is even “excessive” volatility always irrational?
Remember that market price (and therefor volatility) is always driven by the 2 most fundamental factors: Fear and Greed.
These are emotions, and no doubt emotions can be irrational, but not necessarily so! After all, both can be seen as essential for human survival and evolution.
Volatility is necessary for the “normal” ebb and flow of markets, and has a root cause in the money flow in and out of equity/commodity/futures/derivative markets.
“Excessive” volatility spikes (where VIX quickly flares up from say, 15 to 30 or higher) I associate with broad-based panic and can be triggered by several factors; covering of margin debt assigned to long positions, tightening of flash algorithms, lots of short-selling by market makers, catastrophic news, &etc.
Emotional rather than rational? Of course. But when it comes to money, there’s a very fine line between logic and rationality on the one hand and pure emotion on the other!
Good luck!
Well, I think that’s enough work for one day – 6 hours straight. Proud of that. Will write the bosses wishing them a pleasurable afternoon – looking forward to seeing them all refreshed in the morning.
#201 Leo Trollstoy on 08.25.15 at 1:51 pm
…and that is how civilizations have always imploded since the dawn of civilization, every single time – book it.
RE:but unfortunately, I bought 20%vab, 20% prefereds.
So down quite a bit, and foolishly bought preferred without understanding of what makes them go up or down
Unless it is in a taxable account, I see no reason to substitute preferreds for bonds for the fixed income portion of a balanced portfolio. Bonds balance equites better than prefs. Use short bonds in a RRSP/TFSA if the US Fed makes you nervous.
#193 Godth on 08.25.15 at 1:16 pm
No its not collapsing but its getting more twisted by the day….Most business’s are owned directly by gangsters…The Gov spends your money try to stay elected no matter what it costs…That’s why Canada is filled with handouts too dead beats.
#211 Godth on 08.25.15 at 2:30 pm
Won’t happen in my lifetime.
Deal with it.
Now get back to work.
#211 etc. Godth
Do you suffer from depression? I suggest you either start a business and invest your money, then enjoy the freedom that it brings to do the things you really desire.
To mop on this blog about the collapse of civilization is really getting tiring. It’s all about decision. You can be a realist and not have to be mired in hopelessness. Get out there and make a difference.
#213 Bill on 08.25.15 at 2:53 pm
Yes Bill, it is collapsing and has been for decades. Your failure to recognize what’s happening doesn’t mean it’s not happening.
https://collapseofindustrialcivilization.files.wordpress.com/2015/07/pnas-2015-schramski-1508353112.pdf
Unsustainable is unfolding all around you, despite the smiley faces.
I always read LLEWELYN, the WASHED UP LAWYER, PINSTRIPE, the WISCONSIN RETIREE, VICTORIA WHATEVER, and CROSSBORDER- and it finally dawned on me that these boys are as old as I am or older.
GODTH, like him or not, is a very interesting fellow. PONZIUS (ein frecher Fratze), KREDITANSTALT, [EINGESTUERZTE NEUBAUTEN (!) too] get my attention.
They, like BILL GABLE, could be more expansive, their posts are too short.
THE AMERICAN takes top hono(u)rs for humo(u)r.
Love the SASKATOONSTABBER and BOSS PITTENS.
I read all the females. This blog is seriously harmed in that there’s so few. That LENDERBY woman is a force of nature.
Never ignore the young. The angry millenials’ posts are important.
SMOKING MAN is of interest when he’s directly serious.
I usually read GT twice, the second time with care. When I’m in deep disagreement – I ignore it – I haven’t yet come across something that would kill him other than his GENERAL establishmentarian optimism . . . When he advised to lighten up on maple syrup: I can’t think of a more negative prognostication for Canada and he’s quite correct. (How un-CBC can you get, eh?)
The only posters I don’t like are the smarmy sycophants.
#215 Axehead on 08.25.15 at 3:00 pm
Business as usual is hopelessness. It’s you that’s hopeless as you can only imagine more of the same, science tells us where that leads.
So yes, I find you depressing.
Blimey, some of our number are getting a bit hot under the collar! Fulminating about “unexplained volatility” and some ruff types are hoping for the Doom of Civilization™ to be upon us.
I dunno, we’re all going to die, but it doesn’t have to be tomorrow! Fear, anxiety and stress are the killers of the mind and body, but the media use them to sell us.
Try and enjoy yourselves and get outside a bit more. Take a walk. Go down to the Animal Shelter and adopt a bunny, ffs! Go help in the Food Bank. Volunteer to collect door-to-door for a charity. Do some good.
#98 Leroy Washington on 08.24.15 at 8:39 pm
– so glad to see you back, dear lad! We missed your regular emissions. Your mother gave you your internet privileges again?
#214 Leo Trollstoy on 08.25.15 at 2:58 pm
You don’t plan on being around in about the 2040 timeframe then? You’re old and having your last hurrah? Carry on then.
http://www.independent.co.uk/news/science/nasafunded-study-warns-of-collapse-of-civilisation-in-coming-decades-9195668.html
Exponential curves are a bitch and the laws of thermodynamics are merciless.
Have fun being richer and richer though (via increasingly rigged markets).
We need some pom-poms and cheerleaders.
Meanwhile, a terrible menace is stalking the mean streets of America:
Little Free Libraries!
#214 Leo Trollstoy on 08.25.15 at 2:58 pm
p.s. I’m currently working on a sculpture of a screaming Chimp. holding a (carved wood) human mask in one hand and taking a selfie with the other. Maybe I’ll call it Leo the Troll.
@215 Axehead
I have a business that’s doing ok, but Godth is still correct:)
Being positive and politicaly correct at almost any cost is Canadian Brainwashing which started when the boomers took power.
In other words ignore problems or clear warning signs of problems, carry on thinking about just yourself and ignore. By no means attempt to organize to confront the problems……
Over time you will learn the most effective way to improve the macro is to work on betterment of the micro. Start with your own life. — Garth
Lets not kid ourselves, the Boomers got us into this mess…with their ‘housing always goes up’ entitlement.
Now we will see what happens to them with the Loonie already at the 74 handle going towards to the low 60’s in USD.
Have fun spending your twilight years in the Frozen North! Your pensions are already devalued 33%…on their way to 55%!
The young and educated would be stupid to stay in Canada paying healthcare and GIS for these entitled seniors.
That was ugly. How is ageism different from racism? — Garth
I don’t think this ends well for the goat!
https://www.youtube.com/watch?v=687KtPXuDGY
I think you may have me confused with Godth.
However good advice, Garth. You’ll never know if I have or have not implemented it into my daily existence, and it is not your problem anyhow..
However Godth has stated the facts.
Denial, ie Canadian Boomer Fake Positivity is a detriment, especially for the practitioner….
Over time you will learn the most effective way to improve the macro is to work on betterment of the micro. Start with your own life. — Garth
#216 Godth on 08.25.15 at 3:05 pm
I agree to a large degree…the good old times are gone. Globalization IS slavery for the middle class…Would can compete with Asia wages….
If Canada continues this path we will be Greece 2.0..
I’m better off then most in Canada but feel like I’m just staying afloat…..
Ageism as you call it is the reality. You reap what you sow and it is colour blind:)
Keep that fake political correctness going Garth. It’s worked well (for boomers) for over 30 years……..
Lets not kid ourselves, the Boomers got us into this mess…with their ‘housing always goes up’ entitlement.
Now we will see what happens to them with the Loonie already at the 74 handle going towards to the low 60’s in USD.
Have fun spending your twilight years in the Frozen North! Your pensions are already devalued 33%…on their way to 55%!
The young and educated would be stupid to stay in Canada paying healthcare and GIS for these entitled seniors.
That was ugly. How is ageism different from racism? — Garth
Collossal battle PPT vs Hedge funds at the end…trying to hold 1873 s&P
Average Calgary Household has Net Worth of $835,000!!!
Wow! Take that.
http://calgaryherald.com/business/local-business/average-calgary-household-has-net-worth-of-835000-report
What a suckers rally that turned out to be.
“Central banks have become a stabilizing force. Life is improved because a globally-coordinated monetary policy is starting to emerge. Humanity will be better served with a moderation of the boom-bust excesses of unchanneled capitalism. –Garth”
——————————————————–
Yes, moderation….very telling comment.
Hey what happened in the stock market? Started off with such promise. Now nothing.
Hal # 6,
“We have now gone 24 quarters in a row since the ’08-’09 recession. Why isn’t it only logical that we are headed into a recession now?”
—————————————————————
For the recessionary cycle to occur, seven years or otherwise, rapid growth post recession must have taken place. But things seem different post the GFC. Growth has sucked, people have become risk averse. No Boom (that leads to eventual oversupply) equals no bust (no cleansing of excesses, providing new opportunity)
Just perpetual muddling along…..
#225 Holy Crap Wheres The Tylenol on 08.25.15 at 3:43 pm
If you want to be the GOAT you better be juiced, doesn’t matter if it’s sports or finance. Everybody needs the JUICE to be the GOAT!
p.s. I’m currently working on a sculpture of a screaming Chimp. holding a (carved wood) human mask in one hand and taking a selfie with the other. Maybe I’ll call it Leo the Troll.
interesting piece, great name. I’d like to see it.
Denial and the blame game. Round and round we go here.
As Garth points out it is unfair to generalize and judge an entire generation based on a few crusty souls or moist mellennials. I know many open minded people in all age groups and am always particularly fascinated when I meet a boomer who sees clearly what is really happening in the world around us. They are out there, be it few and far between. On the other hand I also meet many closed minded individuals in all age groups who refuse to see and accept what is really going on. Ignorance knows no age group and its deliberate ignorance at this point if you cannot comprehend that they are indeed spraying poisons in our atmosphere. Some understand, some refuse to see even when shown.
I have spent most of my life trying to open people’s eyes to the reality of the situation and have learned a lot about human behaviour along the way. Many people are enlightened to be able to see something they could not previously see, even though it was hidden in plain sight. Even if it is a crime against humanity, most would rather know than not. Some refuse to see, laugh and make fun of me for pointing things out, call me crazy in front of groups of people. Then one day they will muster up the courage to ask in private what they once heckled me for in public. I have learned people awaken differently at their own speed and the ones who have been locked into their thought patterns the longest are the most emotional when learning the reality of the situation.
I don’t know it all and have never claimed to.
I have much to learn and that is why I come here daily
A little understanding goes along way
Apparently a swing from down 1080 to down 200 to down 588 one day and then up 440 to down 200 the next day is being presented as normal days at the office. That is quite an office!!
Surely something other than a list of the usual suspects is causing these wild swings. I for one am interested whether there is something new in the structure of the global economy that might be exposing stock markets to increased volatility.
Somebody was making money lately but I doubt if it was the retail investors.
The HFT’s, the short sellers and the day traders will be having a blast with this market as they did a couple years back. Gotta love that volatility. TSX opens 260 points above yesterdays close, 740 point spread during intraday trading between high and low and ends up closing 98 up. Expect much of the same from here on in.
#230 JSS on 08.25.15 at 4:04 pm
Somehow I think their “net worth” calculation is only done on one side of the balance sheet.
“Over time you will learn the most effective way to improve the macro is to work on betterment of the micro. Start with your own life. — Garth”
righteous.
This is really all there is to learn in life.
#217 Nagraj on 08.25.15 at 3:12 pm
“I always read LLEWELYN, the WASHED UP LAWYER, PINSTRIPE, the WISCONSIN RETIREE, VICTORIA WHATEVER, and CROSSBORDER- and it finally dawned on me that these boys are as old as I am or older.”
Cautiously agreed, so far. As with our sexagenarian host. We can learn stuff from old people, sometimes.
That LENDERBY woman is a force of nature.
Ah the weasel words of ambiguous praise – you are getting quite skillful, grasshopper :-)
Force of Nature…hmm, I choose electromagnetism…no, the weak nuclear force…ahh…it’s so true! Gravity!
Bubbles don’t correct they pop.
Algos playing the sheeple like a violin.
Reminds me of the Charlie Brown and Lucy football shtick.
Market’s are done, it’s now time to call the QE home.
Cut your losses.
Strange thing about math is how it can look different and mean the same thing.
A stock can rise from $5 to $10 and thats a 100% gain.
A $10 stock can fall $5 and be a 50% loss.
Things that make you humm.
http://www.bnn.ca/Video/player.aspx?vid=688482 Oil Headed to $85 by year end. Buy now or get priced out!!
Record level demand is the assessment so bulk up early.
Had to share cause CAN’T STAND HARPER!
Ill vote for the you fool and pray
http://jugglingdynamite.com/2015/08/19/2015-election-question-how-do-we-like-our-countries/
If the US economy is so good why are interest rates still stuck at record low levels. If the economy was fundamentally strong we would have much higher interest rates.
So yes there is an illusion that the US economy is strong but only because interest rates are at record low levels andhave been there for a long long time.
In fact all western economies are addicted to low interest rates.
If interest rates move back to normal values tell me how great the US economy would be..it would be a disaster.
Not only will it be no disaster, but it’ll happen. Central banks are actually wiser than you. Who knew? — Garth
Yup. I was right. And now it’s over. Sorry to learn of your reading issue. — Garth
In all fairness, they could have a math issue…..
“All the doomsayers and cry babies gone into hiding.
Or back to being wage slaves.
Don’t quit your day jobs fellas”
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“The world is not the way they tell you it is” A.Smith
Seems someone counted his chickens before they’re hatched.
http://www.investing.com/indices/major-indices
Selloff in the three largest economies when everyone else was tricked to “buy the dip”.
Now the trapped 90,000,000 newly minted Chinese “investors/traders/chao gu piao” will try to get off the “frying stocks” any chance they get and will sell into any rally. Stick a fork in the Chinese stock markets for a while – and from there on the rest of the world’s!
Just for fun why dose walmart work in Canada but target
did not? They cut bait and ran.
@JSS, post 233:
The stock market went on sale, that’s what happened. It happens from time to time, and it’s something to celebrate and buy more stocks (or ETFs) rather than be feared as often happens during these sales.