Never say never

HUG modified

A bogus report on Chinese house-buying in Vancouver. A sleazy fear-mongering campaign to scare people away from their banks. What else can we put on the menu for an Easter weekend? After all, this is a full-service blog. If you go a week without being offended, we’re not trying hard enough.

So let’s address a canard that deserves to be squished.

Here’s Nathan, with a good and timely question:

“It seems a lot of people have similar questions to mine after reading your blog.  Is it even possible for interest rates to go up much in the next ten years? It would seem that every country (and person) in the world has an addiction to debt and a couple of point swing in interest would probably break many countries ability to pay?  Kyle Bass has said it is impossible for interest rates to go up significantly in our lifetime due to this very issue, don’t you think the number of countries/individuals this would impact would prevent central banks from raising interest rates to a normal level?”

BASS modified  First, Nate, Kyle Bass wants to scare you, because he sells financial products that frightened people buy. Plus he’s a gold nut. Mostly you should ignore him because he’s wrong.

The US raised rates for the first time in a decade in December. You should expect two more during 2016, with the next increase coming as soon as next month. The Fed’s pretty cagey and unpredictable, so we have no real idea when the trigger will be pulled, but the rate will likely be a half point higher by the end of the year. And another 1% above that by the end of next year.

This is because the American economy is doing fine and policymakers wish to steadily reduce the amount of stimulus government injects, in order for more sustainable long-term growth. Plus they worry about debt, and the bubbles that cheap money cause. This is why they ended the monthly bond-buying in 2014 (which Bass and the geniuses here said would never happen) and why we got the increase in December (which Bass and the doomers on this blog swore was impossible).

Normalizing the cost of money is good monetary policy, and every central bank in the world is jealous of the Fed these days. They all want their economies off the junk food of cheap rates. And it’ll happen. Once commodity values creep back you will see a corner turned. Don’t be on the wrong side.

As for Canada, over 90% of the time the bond market here follows that to the south. In fact 93% of the time the Bank of Canada ends up aping the Fed in its monetary policy. So I think you’ll see a higher rate here within the next 12 months. So get ready now. For example, preferred shares – whacked last year by two Bank of Canada cuts – could have a glorious future ahead.

Meanwhile we have this T2 thing going. The deficit, as you know Nathan, was extreme – three times what we were promised in an election just a hundred-odd days ago. In fact, deficits will be the norm for every single year of the Trudeau admin, adding at least $100 billion over the next four years. If he’s elected again, he will certainly trounce the Harper record of $170 billion in new debt over eight years – and he won’t even have a recession to blame. Atta boy, Justin.

Deficits are a form of economic stimulus, since the government will print and borrow more money than it raises from taxes, in order to dramatically increase spending. Deficits today represent additional future taxes, but Boomers don’t care about that because it’s the Millennials who will pick up the tab. BTW, did you hear that Premier Notley now says Alberta has completely abandoned a balanced budget? More deficits as far as the eye can see on a prairie morn.

Anyway, Nathan, we were talking about interest rates. And now that the federal government has assumed the role of stimulator, at the same time the Americans are raising the cost of money, the odds of the next Bank of Canada move being up (not down) have jumped. Our central bankers, like those in Washington, dearly want to restrict credit, end the growth in household debt and prick the bubble housing market before it erupts on its own. They’d like higher rates to support the Canadian dollar, keeping it in a less volatile trading range, to temper the consumer inflation that comes with a limp currency and tackle the destructive meme (which you and Bass espouse) that rates can never go up.

That breeds irresponsible borrowing, and gives us $1.8 million detached houses in Vancouver.

So, use cheap money now to accelerate debt repayment. Don’t binge borrow to buy assets that low rates have inflated. Never believe it’s different this time. And be so careful about what you read.

152 comments ↓

#1 TurnerNation on 03.27.16 at 7:57 pm

Deleted (exceeded three posts per day limit)

I wish…

#2 mortgagebrokeron on 03.27.16 at 7:57 pm

Well said Garth……. too much debt out there!!!!

#3 John on 03.27.16 at 7:59 pm

With regard to the bail-in thing. Might want to read this
article:

http://www.canadianstructuredfinancelaw.com/2014/09/articles/regulatory/thoughts-on-finance-canadas-recently-issued-consultation-paper-on-bailin-capital/

“The consultation paper provides that the authorities would have the flexibility to determine, at the time of resolution, the portion of eligible liabilities that was to be converted into common shares in accordance with the conversion power.”

What constitutes ‘eligible liabilities’? Take certain cash liabilities and convert them into shares and then bail them in………???
“The consultation paper contemplates that conversion would be effected by means of a statutory power allowing for the permanent conversion—in whole or in part—of specified eligible liabilities into common shares of a bank. “
What constitutes ‘specified eligible liabilities?”
“The bail-in regime is likely to have other effects on the offering and disclosure regime applicable to debt of a bank.
Whether the proposal is enacted as proposed, however, remains to be seen. The Department of Finance is accepting comments, including in respect of specific consultation questions, until September 12/2014)”

Nothing new there. Bail-in bonds will likely be snapped up by investors. — Garth

#4 Chris L. on 03.27.16 at 8:01 pm

I bought 1700 shares of CPD. You should be proud of me for something Garth.

#5 HoweStreet.com on 03.27.16 at 8:02 pm

Garth talks about the Federal Budget, Real Estate, Pot, and Commodities – This Week in Money
http://talkdigitalnetwork.com/2016/03/this-week-in-money-39/

#6 totalinvestor.com on 03.27.16 at 8:05 pm

Garth,
You’ve been wrong on real estate for 5 years straight, Kyle’s record is better than yours, plus he has 1000X more money than you do.
So why should I believe you over him?

So don’t. — Garth

#7 salonist on 03.27.16 at 8:07 pm

Happy St. Patrick’s Day, Did You Know St. Patrick was Italian?

a week late, I did not know this

http://everybodylovesitalian.com/happy-saint-patricks-day-did-you-know-st-patrick-was-italian/

#8 common sense on 03.27.16 at 8:07 pm

Please raise the rates..let’s see if the markets can handle it once and for all.

The sooner the better.

#9 Sc on 03.27.16 at 8:09 pm

First

#10 espressobob on 03.27.16 at 8:11 pm

Gold is currency? Hasn’t been for 45 years. Just another commodity.

Goldbugs are a good source of amusement. Love them.

#11 p123 on 03.27.16 at 8:13 pm

As logical as that sounds Garth, that hasn’t been the situation for over a decade. It’s consistently been low rates throughout the world. Would we ever see 6% interest in our lifetimes again?

That seems unlikely, judging by how our economies are now.

#12 For those about to flop... on 03.27.16 at 8:14 pm

This ad reminded me of someone on the blog but I can’t quite remember…..

Any guesses?….

https://m.youtube.com/watch?v=1SKRSKXOh0s

M41BC

#13 WalMark of Sadkatoon on 03.27.16 at 8:18 pm

Plus he’s a gold nut. Mostly you should ignore him because he’s wrong.

hint once u find out a person is a gold nut u know they’re likely wrong

it’s also easy to sell overpriced doomed articles and products to gold nuts cuz they’re dumb

easiest sale ever

#14 Atta boy, Justin. on 03.27.16 at 8:19 pm

“Atta boy, Justin.”

A low class sentence like this destroys the objectivity of your column for anyone who is not infected with the disease of ideological blindness.

Does it worth it?

#15 That guy on 03.27.16 at 8:23 pm

Deficits don’t necessarily mean higher future taxes. Indeed, the whole point of a deficit is to stimulate the economy so there are more jobs which pays off the debt. It’s not different than someone going into debt to get an education or a company buying capital.

#16 Ludwig von Mises on 03.27.16 at 8:28 pm

“There is no means of avoiding a final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion or later as a final and total catastrophe of the currency system involved.”

So the honorable Mr. is correct that rates will rise once inflation becomes entrenched. Outside of a commodity based currency system like a gold standard, interest rates as set by the currency issuing bank and also money supply are 2 of the most key influences on the value of that currency. The process is well enough understood today that a complete collapse of the currency can be avoided, but only through the judicial fixing of interest rates and money supply. Even Mr. Bernanke understands this. Since a collapse of the American dollar is not in the interests of anyone, rates will rise if the dollar is threatened, and certainly well before it collapses. The same is true in Canada, the EU, and England. Japan on the other hand may not be successful in defending the Yan but at some point they will try.

#17 John Martin on 03.27.16 at 8:31 pm

I ran across a debt clock for each provinces net debt and the per capita share. The answers are quite revealing.

http://www.debtclock.ca/provincial-debtclocks/

Which province do you live in ?

Keep Smiling ! (hopefully)

#18 Chris on 03.27.16 at 8:34 pm

it is absolutely irresponsible borrowing. With housing price being where it is, it is necessary. Banks give out loans too easily and I hear renewal of loans takes only a phone call. Sad to see Canadian economy consists mainly of people trading houses to each other. Canadian economy is turning into immigration economy and government economy. Higher housing price and higher taxes are regrettably inevitable. The life standards of the average Joe in Canada would continue to suffer. This is just the beginning. Unfortunately.

#19 Sheane Wallace on 03.27.16 at 8:46 pm

#10 espressobob

Gold is currency? Hasn’t been for 45 years. Just another commodity.

Goldbugs are a good source of amusement. Love them.
—————————-

It seems Alan Greenspan disagrees with you.

And who TF were you by the way?

#20 Venicia Staples on 03.27.16 at 8:48 pm

Trudeau Liberals cut off EI to Conservative ridings while extending benefits in Liberal constituencies. Canada has entered the bad old days of Trudeau Liberal actions that resemble a Zimbabwe dictatorship. Good going Liberal voters, you have voted in a gang of Canada haters intent on raping our democracy.

Trudeau the Elder left behind a Charter of Tears and a Supreme Court for life to defend his vile politics, now we see that snake return from the dead.

http://news.nationalpost.com/news/canada/canadian-politics/finance-minister-defends-decision-to-give-extra-employment-insurance-to-parts-of-oil-patch-but-not-others

#21 Sheane Wallace on 03.27.16 at 8:48 pm

Why is T2 running deficit if the economy is fine?

The answer: If he does not we go into outright severe depression caused by over indebtedness and peak debt. So he has to inflate the debt.

Holders of CAD: be aware.

#22 Boom! on 03.27.16 at 8:49 pm

New monicker, same old goat.

Let’s raise rates already. 1/4 point every three months, or so until we get 1-2 pts over inflation. That would make me happy, the Banks happy, and borrowers trembling in their socks, especially those who stretched on a mortgage for 30 years to buy an over-priced house.

Well, what would you expect a well positioned retired Boomer to say?

#23 paul on 03.27.16 at 8:52 pm

11 p123 on 03.27.16 at 8:13 pm

As logical as that sounds Garth, that hasn’t been the situation for over a decade. It’s consistently been low rates throughout the world. Would we ever see 6% interest in our lifetimes again?

That seems unlikely, judging by how our economies are now.
———————————————————-
Try and get money from private sources 45% first mortgage at 3% the bank, want a 20% advance 2nd it’s 12 to 14 % plus a 4 point fee. cheap money lol

#24 Smoking Man on 03.27.16 at 8:53 pm

#14 Atta boy, Justin. on 03.27.16 at 8:19 pm
“Atta boy, Justin.”

A low class sentence like this destroys the objectivity of your column for anyone who is not infected with the disease of ideological blindness.

Does it worth it?
……………………….

ideological blindness ?

Dumbest chirp I’ve read to date. It’s got nothing to do with Ideology.

Stupidity vs good Judgment.

#25 Sheane Wallace on 03.27.16 at 8:53 pm

#13 WalMark of Sadkatoon on 03.27.16 at 8:18 pm
Plus he’s a gold nut. Mostly you should ignore him because he’s wrong.

hint once u find out a person is a gold nut u know they’re likely wrong

it’s also easy to sell overpriced doomed articles and products to gold nuts cuz they’re dumb

easiest sale ever

————————

I have been in the same room with Kyle Bass in NYC, he is not a gold bug or a nut.

These are cheap shots that have no merit and stand no chance in fair argument discussion.

It is very easy to call names.

GT does not stand a chance even in a discussion with me,

Ooh. Tough guy. — Garth

#26 Sheane Wallace on 03.27.16 at 8:57 pm

There is no way to prick the housing bubble.

It is already 7-8 years too late. They have to inflate further or die.

A house in Toronto would be worth 30 % more 2 years from now.

#27 Love my Kia on 03.27.16 at 8:59 pm

I am a dumb gold bug.

My statements of late give me that dumb ignorance glow.

#28 Bobby Booshey on 03.27.16 at 8:59 pm

Good post Garth.

I’m looking forward to lock into one more 5 yr fixed at sub 3% (Q4 2016) for the last time until normal rates come back on my next renewal.

Damn, why am I thinking about this on a Sunday night?

#29 Sheane Wallace on 03.27.16 at 9:01 pm

Ooh. Tough guy. — Garth

Of course that was personal :)

I can spend 1 h for a coffee at Scotia Plaza at any time.

Pass. — Garth

#30 fancy_pants on 03.27.16 at 9:01 pm

More imminent rate increases? Me thinks the record is scratched, seems to be playing the same song. sorry, I was a naysayer of rate hikes for 5+ years now and will continue on that path. well, no path really – I could give 2 shites what rates do. whatever. but definitely let me know when the gov’t entertains a playbook to come sniff my piggy bank

#31 Darryl on 03.27.16 at 9:04 pm

Off topic but does anyone know where I could get the best rate to convert CAD to GBP ? I’m sure this group will have some good ideas.

Banks seem to be highway robbers in currency exchange.

Hope you don’t mind Garth

Thanks in advance

#32 Sheane Wallace on 03.27.16 at 9:05 pm

Pass. — Garth

Well, some pay 10 k per day for my services. Including top Canadian banks. No wonder they are in that shape.

#33 David on 03.27.16 at 9:09 pm

The Liberals should reinstate the seven percent GST which Harper reduced to five percent. That would net the treasury an extra $14-billion a year at least.

#34 Mark on 03.27.16 at 9:14 pm

“hint once u find out a person is a gold nut u know they’re likely wrong”

Gold nuts don’t get it right very often. But when they do, the results are spectacular. 1930s. 1970s. Hmmm, what happens when you add 40 years to the 1970s, in conditions where monetary stability clearly is the name of the game… hmmmm…. Maybe the gold nuts are onto something these days after being so ‘wrong’ for so long.

#35 Jerry Right on 03.27.16 at 9:17 pm

Garth, you’re either incredibly naive or so political motivated by Liberal political correctness that you can’t see the forest for the trees. Chinese emigration is a big problem everywhere in the world and peoples governments around the world are reacting to it.

http://www.bangkokpost.com/opinion/opinion/912200/thais-must-face-up-to-china-reality

If you’re of the opinion that ‘you’re right and everyone else is wrong’, it’s time for the couch chum.

I can send you these stories from Africa, Singapore, SE Asia, South Pacific Islands, Australia. Why do you think it’s OK for Canada to be run down for the sake ‘of not appearing racist’, god forbid. Wake up buddy, your Liberal multiculturalism is in flames in Europe and driving people out of their homes in Vancouver.

#36 lee on 03.27.16 at 9:19 pm

All that’s going to happen in Canada is rates will inch slowly higher and as that happens the maximum amortization rate will just be extended probably to 35 years again to keep house prices and building going. Governments will always keep homeowners happy because they are 70 per cent of the adult population. You’ll all be on your death bed surfing the MLS site waiting for prices to come down.

#37 Mark on 03.27.16 at 9:20 pm

“Off topic but does anyone know where I could get the best rate to convert CAD to GBP ? I’m sure this group will have some good ideas.”

Interactive Brokers has excellent commission rates. The thing is, you’ll need a brick and mortar bank account to actually wire physical UK pounds out of there if you need physical cash

Are you buying UK pounds as part of an investment strategy, or are you buying them to spend?

IMHO, for foreign currency spending, the best ‘solution’ I’ve found is the Amazon.ca credit card. They don’t charge a forex commission, and they give you 1% cash back. Its what I use when travelling in the US and overseas.

#38 countrymusicfan on 03.27.16 at 9:26 pm

If he’s elected again, he will certainly trounce the Harper record of $170 billion in new debt over eight years – and he won’t even have a recession to blame. Atta boy, Justin.
—————————————————————-

And yet, Garth, history tells us a different story.

Even though I have lived under Conservative ideology for most of my life and generally prefer that to the Liberals or NDP, it has always for my lifetime in Canada been the Conservative brand of government, federally and provincially, that has shown itself to be fiscally irresponsible. I see no reason to believe the Liberals will not steer things back on course once again after the current necessary stimulus program, just like they did in the 1990s. Which was, I remind you, made necessary this time around by outright lies told by Harper’s regime about the state of our economy just last year. Same for Notley and Alberta, as she tries to clean up after 40 years of unmitigated Conservative idiocy and mendacity and incompetence in planning for the future…which they did not do at all.

Garth, you have spent some time in Conservative circles and caucuses, so you may be in a position to answer this:

What is it, exactly, about the Conservative mindset that seems to attract so many low IQ, mentally defective retards when it comes to any serious financial decision-making?

Why is it always Conservatives, from the drunken Klein to the still-unindicted Mulroney, who lead our country astray financially, building up debts and setting us up for failure that other parties have to try to clean up?

Is it lead in their drinking water? Brother and sister marriages? A secret society of shared lobotomies? Undiagnosed STDs?

Why are Conservatives such complete idiots?

Why must we always have to shrug and accept that people like Notley, Trudeau and Wynne, while imperfect, are so much superior intellectually and in most other ways, to the Conservative alternatives?

#39 Sheane Wallace on 03.27.16 at 9:29 pm

#33 David on 03.27.16 at 9:09 pm
The Liberals should reinstate the seven percent GST which Harper reduced to five percent. That would net the treasury an extra $14-billion a year at least.
——————————-
You do not understand. They need to spend money, not collect them.

Nobody is saving anything anyway, taking additional 2 % of HST is limiting consumption by private citizens while boosting consumption by government. It is zero sum game, they need to actually reduce taxes and run deficit at the same time.

Repeat with me: We are at peak debt. Only way out is inflation of the debt. Loonie going to 30-es.

#40 Hotdogs from Heaven on 03.27.16 at 9:31 pm

#33 David on 03.27.16 at 9:09 pm
The Liberals should reinstate the seven percent GST which Harper reduced to five percent. That would net the treasury an extra $14-billion a year at least.
————————————————-

But that would also take the $14 billion out of the economy which would negate the whole point of running the deficits to grow the economy.

#41 For those about to flop... on 03.27.16 at 9:34 pm

#31 Darryl on 03.27.16 at 9:04 pm
Off topic but does anyone know where I could get the best rate to convert CAD to GBP ? I’m sure this group will have some good ideas.

Banks seem to be highway robbers in currency exchange.

Hope you don’t mind Garth

Thanks in advance.

///////////////////////////

Hey Darryl,if you are in Vancouver you can try Vancouver Bullion on Granville.

My wife got a better rate on CAD/usd 2 weeks ago.

//////////////////

Boom! At 22 ,if that is you enjoy your new name brother…

M41BC

#42 David on 03.27.16 at 9:37 pm

‘Normalization’ of rates is too often bandied about as something bearing little connection with employment and inflation.

Yes, the US is close to full employment, although that in itself is debatable:
http://moslereconomics.com/2016/03/22/employment-comments/

Inflation isn’t exactly out of control:
https://research.stlouisfed.org/fred2/series/CPIAUCSL

And look at all those hikes coming down the pipe:
https://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yieldYear&year=2016

As for it never being different this time, can you recall a period when near zero rates didn’t result in sustained above target inflation?

Now I’m not saying rates cannot increase, in fact I’m sure the Fed will increase this year. I picked up additional rate-resets in February because they were so ludicrously oversold so I’m not clinging to some personal need for low rates. I just remain skeptical that economic conditions will justify 2% by the end of 2017.

#43 Marco Polo on 03.27.16 at 9:47 pm

I usually agree with Garth, just not on the bail-in thing. So, T2 produced a budget that hand a bailout attached to it. Ford, GM, Chrysler, all make cars with a spare tire in the trunk.

You’ll never, ever need a spare tire, so why include it at all.

After all, income tax alone was to be only a temporary measure. Once the government has their hand in your pocket, they never let go, it’ll be the same with these fools.

Government interference in life is growing, it’s time to demand less, and require less from them.

#44 Ron on 03.27.16 at 9:51 pm

Kyle Bass is one of the most respected investors out there, and with a track record to back it up. He is a realist and everything he does is based on facts and common sense which sadly isn’t common on wall street. He’s one of the few people that I listen too. And no, he isn’t a gold bug.

Here is a presentation he did in 2014. From the 35 min mark he talks about the Canadian housing market.

https://www.youtube.com/watch?v=VBPZ58dzjfE&list=WL&index=1

#45 nobody on 03.27.16 at 9:52 pm

It’s not like it’s difficult for Alberta to balance its budget.
Just buy all the unemployed oil workers a greyhound ticket to another province.

Close all the schools in edmonton and calgary (in fact close edmonton and calgary) and go back to being an empty bit of grassland with a few cows

#46 Just Me on 03.27.16 at 9:52 pm

For Darryl #31

Continental Currency Exchange has about 130 locations where you can go in person to exchange your funds. I got mine at Masonville Mall in London Ontario where they have a kiosk. Fast, efficient and friendly service as well as a good exchange rate.
http://continentalcurrency.ca
Good luck.

#47 A man about a dog on 03.27.16 at 9:52 pm

Garth, thanks for the blog and free education. I would probably fall victim to the realtor math, goldbugs, inflationistas, and bail-in baiters. greaterfool is a voice of sanity in the financial world that I don’t understand too well….yet. And the comments section is great, where did you find these clowns?

#48 You're right on 03.27.16 at 9:55 pm

I think you are absolutely right Garth. Yellen has said for the the last 2 years they will move away from QE and gradually raise rates, that is EXACTLY what they have done. The markets go through spastic convulsions every time the FED follows through on their agenda. When the market settles back down and accepts the new norm the FED will move again.

#49 mike trike on 03.27.16 at 9:57 pm

“For example, preferred shares – whacked last year by two Bank of Canada cuts – could have a glorious future ahead.”

What preferred shares ETF’s do you recommend Garth?

#50 Entrepreneur on 03.27.16 at 9:57 pm

#33 David, you have to be kidding when you say increase the GST from 5% to 7%. Do you know where that money comes from? We want people to buy not shy away from increased taxes. Already people do not buy as much because of the GST. Harper did right by decreasing the amount. I think the GST should be scrapped like Jean Chrétien promised us when he got elected but that did not happen.

#12 For those about to flop…I guess Mark. I actually like Mark’s comments.

Calling interest rates is like calling wolf too many times. When will it happen? Who knows, who cares anymore. More lives have been ruined because of the low rate and that is not what we want in a country.

#51 Frank on 03.27.16 at 10:01 pm

Heard this last year.

And it was correct. The Fed raised its rate and signalled more to come. How much warning do you need? — Garth

#52 Basil Fawlty on 03.27.16 at 10:11 pm

Kyle Bass runs the hedge fund Hayman Advisors. In 2007 the company had a return of 216% betting against the subprime housing market. The minimum investment in Hayman is $5M.
Kyle Bass advised the University of Texas Endowment Fund to invest in gold and their current gold investments total $1.1B. The reason Bass recommended gold investments is due to, in his opinion, the inevitable inflation associated with the excess money printing of central banks.

As I said, he has an agenda. — Garth

#53 Keith in Calgary on 03.27.16 at 10:14 pm

Jerry Right said…………”Garth, you’re either incredibly naive or so political motivated by Liberal political correctness that you can’t see the forest for the trees.”

—————–

It’s both…………”denial of reality” is one of the four pillars of liberalism.

Last week I was a Con shill. Loving it. — Garth

#54 For those about to flop... on 03.27.16 at 10:15 pm

Entrepreneur at 48

#12 For those about to flop…I guess Mark. I actually like Mark’s comments.

///////////////////////////

I’m happy that you like his comments ,but let me tell you that when we go and play darts each Tuesday I give him 100 darts ,he hits the bullseye twice and the other 98 darts end up hitting the pinball machine…

M41BC

#55 common sense on 03.27.16 at 10:22 pm

#54 Flopper

Your giving Mark far too much credit…2?

#56 Basil Fawlty on 03.27.16 at 10:26 pm

“As I said, he has an agenda. – Garth”

Yes, he likes making money.

That can get in the way of loftier things. — Garth

#57 John on 03.27.16 at 10:27 pm

Nothing new there. Bail-in bonds will likely be snapped up by investors. — Garth

Guess time will tell. “Snapped up” or may “Buckle up.”

Every niche has a ‘Greater Fool’ or something like that…

Heh, maybe after the Shangahi G-20 they’ll all switch musical chairs and the US buck and Chinese Yuan will be the descending currencies and the Euro and Yen will be the upside currencies. If so, anyone’s guess, the cheaper Buck will mean oil prices will rise and Alberta might get some relief. Of course T2 will take credit.

For most, sq. ft. is a debt they seem to run to when the rest of the choices start getting rules and regs in “Fs” and T2’s budget………. or not.

Stay Good, everyone.

#58 For those about to flop... on 03.27.16 at 10:38 pm

#55 common sense on 03.27.16 at 10:22 pm
#54 Flopper

Your giving Mark far too much credit…2?

///////////////////////////

Hey Common ,I forgot to add that the two darts that hit the bullseye ricochet of the pinball machine…

M41BC

#59 Smoking Man on 03.27.16 at 10:40 pm

This is not good for Housing if it continues.

http://www.bankofcanada.ca/rates/interest-rates/canadian-bonds/

But got a feeling, only a feeling, not based on anything but wims and electrical energy from the UCC. It says it’s a good time to buy bonds.

#60 joseph on 03.27.16 at 10:40 pm

Interest rates now in Canada will remain stagnant for decades. If you read all of the articles on the effect of retirement of the baby boomer generation [reinforced by you Garth] on the Canadian economy over the next 20 years, it is demonstrated that Canada will struggle to grow even 1.5% per year very quickly as the population ages. Immigration levels won’t offset this negative economic impact. When this process kicks in full force, the only real stimulus we have left to keep the economy growing (even modestly) are low interest rates. Get used to what you see now, they will be this low (maybe 1% higher to help the pension funds) for quite a while.

#61 WalMark of Sadkatoon on 03.27.16 at 10:41 pm

the US economy is fine. the rest of the world sucks

http://www.cnbc.com/id/103498897

#62 WalMark of Sadkatoon on 03.27.16 at 10:46 pm

gold nut at bank burns $10k on another gold nut

easiest sale ever

gold nuts will buy anything gold nuts like truck nuts so funny nutty lol

#63 why do we read the comments? on 03.27.16 at 10:48 pm

Sir Garth,

It would be interesting to see how many of the dogs read the comments. Of those, how many read them just to laugh at the many **beeeeps** that keep writing craps because they ‘feel’ they have a voice.

#64 WalMark of Sadkatoon on 03.27.16 at 10:49 pm

I actually like WalMark’s comments

can u give him a job? he says HR won’t call him
back cuz he’s overqualified

lol funny typing that lol

#65 Chris on 03.27.16 at 10:52 pm

Garth – why do you keep talking about the Liberal budget deficit in 5 years. As a former politician, you know the playbook. Set the bar low, things are bad, then beat expectations. Worst case scenario if things go south, you meet your call. Best case, scenario, budget is balanced in 4 years and year 5 is a surplus. Likely scenario, year 5 the budget will be right on track to be balanced at election time….vote in a second Liberal mandate and watch the surplus grow. You all know its true.

#66 Apocalypse2016 on 03.27.16 at 10:54 pm

As North Korea prepares its nuclear strike, Europe provides a perfect distraction, heading into total chaos and dissolution before our eyes.

http://www.theglobeandmail.com/news/world/between-terror-migration-and-the-economy-is-europe-about-to-collapseafter-brussels-the-eu-faces-questions-about-whether-its-about-to-collapse/article29397884/

http://www.cnbc.com/2016/01/20/europe-on-the-verge-of-collapse-soros.html

http://www.nybooks.com/articles/2016/02/11/europe-verge-collapse-interview/

http://www.express.co.uk/finance/city/641080/European-banks-heading-for-collapse-warns-expert

http://www.vanityfair.com/news/2016/01/europe-terrorism-migrants-debt-crisis

The final article might send a shudder down the backs of Canadians, underscoring how the failure to create a cultural melting pot in Europe’s nations has prepped them for disaster.

” Maybe the E.U. is more resilient than any of us suspect, but the problem is not only institutional. Throughout its history, Europe has failed to integrate successive influxes, with the result that people of different ethnic origins have stuck together in clumps. Resentment builds both inside and outside these shuttered communities. While European culture offers much to its people, it has never successfully created a melting pot, and that finally may be its biggest problem.”

#67 Vaxxed on 03.27.16 at 10:57 pm

Interview with the producer of the Vaxxed movie, pulled from the Tribeca Film Festival.

https://www.youtube.com/watch?v=tvcdh7KlgPI

Go away. Not a vax blog. — Garth

#68 Chris in Nanaimo on 03.27.16 at 11:06 pm

Currently on vacation in Maui…..tell ya what, if I was one of these mythical Ham moving my money out of China to an empty property…2 or 3 big ones buys a very nice property here…why Vancouver to buy a bung?…

#225 Retired Engineer on 22nd March…

The one thing about 9/11 that intrigues me……traces of military grade thermite high explosive found at Ground Zero….not too mention video evodence of it…e.g…molten metal pouring out of the WTC’s pre-collapse….

All dismissed my the official NIST report.

#69 Atta boy, Justin. on 03.27.16 at 11:08 pm

#24 Smoking Man on 03.27.16 at 8:53 pm

#14 Atta boy, Justin. on 03.27.16 at 8:19 pm
“Atta boy, Justin.”

A low class sentence like this destroys the objectivity of your column for anyone who is not infected with the disease of ideological blindness.

Does it worth it?
……………………….

ideological blindness ?

Dumbest chirp I’ve read to date. It’s got nothing to do with Ideology.

Stupidity vs good Judgment.

—–

Present me your argument and let me make my own judgement.

Don’t try to force feed and school the audience with your pre-chewed version of “stupidity” or “good judgement”.

Name calling as an argument is hardly a “good judgement”.

When did you turn secretly into a teacher?

I thought I was just a Liberal-Conservative toadie. — Garth

#70 Hopeful but realistic on 03.27.16 at 11:22 pm

Garth’s reasoning
……interest increases + hand-in-hand bond performance with the US will happen.

Therefore:
Canada = 1/10th. the size of the USA.
Equivalency:
Canada could tolerate 1/10th. the USA debt of 18+ trillion $$$’s ($18,000 billion)
Equals 1.8 trillion $$$’s
Less then 1/2 half the existing debt.

Is Canada able to tolerate this debt through these projected deficits?

#71 Bram on 03.27.16 at 11:26 pm

I don’t know, Garth… rates can be low for a very long time.
http://www.tradingeconomics.com/japan/interest-rate

Japan and Canada are kinda similar in their demographics: mainly old people, high median age.

Maybe Canada will go like Japan: into deflation. That would make it really hard, by the way, to pay down the principle for people with debt.

Bram

#72 I live in the Internet on 03.27.16 at 11:30 pm

#67 Vaxxed on 03.27.16 at 10:57 pm

Interview with the producer of the Vaxxed movie, pulled from the Tribeca Film Festival.

https://www.youtube.com/watch?v=tvcdh7KlgPI

Go away. Not a vax blog. — Garth

///

Geez dude.. keep your conspiracy’s straight.. this a building 7 blog.

#73 liquidincalgary on 03.27.16 at 11:31 pm

@ Marco Polo. you said:

After all, income tax alone was to be only a temporary measure. Once the government has their hand in your pocket, they never let go, it’ll be the same with these fools.

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

is that because they enjoy their hands in our pockets? or is it because we keep expecting the government to keep doing more for us? cradle to grave baby

#74 crowdedelevatorfartz on 03.27.16 at 11:36 pm

@332 Sheane Wallace
“Well, some pay 10 k per day for my services. ”
********************************************

I didnt realize male prostitution paid that well.
Time to re-evaluate my life style goals.

#75 Smoking Man on 03.27.16 at 11:36 pm

#69 Atta boy, Justin. on 03.27.16 at 11:08 pm
#24 Smoking Man on 03.27.16 at 8:53 pm

#14 Atta boy, Justin. on 03.27.16 at 8:19 pm
“Atta boy, Justin.”

A low class sentence like this destroys the objectivity of your column for anyone who is not infected with the disease of ideological blindness.

Does it worth it?
……………………….

ideological blindness ?

Dumbest chirp I’ve read to date. It’s got nothing to do with Ideology.

Stupidity vs good Judgment.

—–

Present me your argument and let me make my own judgement.

Don’t try to force feed and school the audience with your pre-chewed version of “stupidity” or “good judgement”.

Name calling as an argument is hardly a “good judgement”.

When did you turn secretly into a teacher?

I thought I was just a Liberal-Conservative toadie. — Garth
……..

Atta boy, Justin, your just a celebrity worshiping Magatroyed. It’s an alien race. lowest IQ in the universe. Yet your teachers gave you a I’m smart certificate. So natural you think you got this.

Open up business, lets see how that certificate works out for you.

T2 has no clue, he’s like an author of a fantasy fiction novel that goes no where. And you an adoring fan pledges loyalty to a story that has a unhappy ending for everyone without brain.

Ill be in Ecuador when you start begging, Smokey what should I do.

#76 Atta boy, Justin. on 03.27.16 at 11:38 pm

#69 Atta boy, Justin. on 03.27.16 at 11:08 pm

#24 Smoking Man on 03.27.16 at 8:53 pm

#14 Atta boy, Justin. on 03.27.16 at 8:19 pm
“Atta boy, Justin.”

A low class sentence like this destroys the objectivity of your column for anyone who is not infected with the disease of ideological blindness.

Does it worth it?
……………………….

ideological blindness ?

Dumbest chirp I’ve read to date. It’s got nothing to do with Ideology.

Stupidity vs good Judgment.

—–

Present me your argument and let me make my own judgement.

Don’t try to force feed and school the audience with your pre-chewed version of “stupidity” or “good judgement”.

Name calling as an argument is hardly a “good judgement”.

When did you turn secretly into a teacher?

I thought I was just a Liberal-Conservative toadie. — Garth

———-

The comment was for Smoking Man, obviously.

Btw in the radio interview, losing the cheap shots you sound like a different person.

http://talkdigitalnetwork.com/2016/03/this-week-in-money-39/

#77 Brazil ex-pat on 03.27.16 at 11:43 pm

DELETED

#78 tundra pete on 03.27.16 at 11:43 pm

Let’s keep rates low as long as possible for the bidding war winners to be heroes, as with the bankers. As soon as it all starts to unravel and the price of your Starbucks heads to nosebleed territory we will quickly see who the whining pussies are.

This will all happen regardless. It is anyones guess though as to when. Can’t be much longer but with a horny govt. extending EI to “special” sorts, and a rock star head honcho,the charade could continue for some time to come.

#79 Vaxxed on 03.27.16 at 11:47 pm

#67 Vaxxed

Go away. Not a vax blog. — Garth

—-

It is not really about vax, it was the news of the day.

When was the last time when the FDA and a Merck made a Hollywood star, like Robert DeNiro eat crow?

#80 Longterm on 03.27.16 at 11:52 pm

#31 Darryl on 03.27.16 at 9:04 pm

xe.com. I go the other way, GBP to CDN all the time.

#81 Ronaldo on 03.27.16 at 11:57 pm

#11 p123

”Would we ever see 6% interest in our lifetimes again?”

50 years ago we were asking the same question when rates were around 10%. And in August 1974 they were telling us not to expect rates to go below 10% ever again. In November 1974 they were saying that a home is so costly today that many homeowners feel it should be passed on to their descendants. The average price of a home in Vancouver in July 1974 was $54,254. Mortgage rate 12%. There was a black market in rentals.(I’ll pay you $500 if I can get the suite you vacate.) In the medium and more so in the lower range, buyers had to go out to Surrey, Haney and Abbotsford and away from Metro area to get prices they could afford. Sound familiar?

#82 Tony on 03.28.16 at 12:38 am

Re: #4 Chris L. on 03.27.16 at 8:01 pm

The FED will weaken the U.S. dollar by lowering interest rates this election year to try to create the facade of a recovery as the lower dollar will help push up stock prices and commodities. A base metal stock bought at the end of this April might have been a better idea.

#83 crowdedelevatorfartz on 03.28.16 at 12:48 am

@#66 Apocalypto 2016

Have you ever heard of Chicken Little?
Your clucking is similar in depth and scope……..

http://www.google.ca/url?url=http://www.preparedsociety.com/Preparedness-Lessons-from-Chicken-Little.html&rct=j&frm=1&q=&esrc=s&sa=U&ved=0ahUKEwiv-uLUyeLLAhUX7mMKHaHHAToQwW4IJTAE&sig2=vfl4-lFS_0A0uwfjbmGpkg&usg=AFQjCNHcVk5ftGUnk9zCrRUXbKXYn5veBg

#84 IKnow on 03.28.16 at 1:03 am

#35 Jerry Right on 03.27.16 at 9:17 pm

Wake up buddy, your Liberal multiculturalism is in flames in Europe and driving people out of their homes in Vancouver.

——————–

At least multiculturalism with Chinese has created kilo-tonnes of millionaires

#85 Hope & Change (Canada) on 03.28.16 at 1:23 am

#38 countrymusicfan on 03.27.16 at 9:26 Why are Conservatives such complete idiots?

Why must we always have to shrug and accept that people like Notley, Trudeau and Wynne, while imperfect, are so much superior intellectually and in most other ways, to the Conservative alternatives?

Speak for yourself. When power switches from Conservative to Liberal (or worse NDP) it’s THE signal that the party is over and you need to get out of dodge. It’s like they are ringing the bell at the top. All downhill after that.

Usually if you want to afford a nice home, have a high savings rate and a good quality of life, you need to go where you can make the highest income while paying the least taxes. Invariably, this involves searching for Conservative jurisdictions.

#86 preet89 on 03.28.16 at 1:29 am

Debt is just a part of life like breathing. Don’t know why the oldies here are so afraid of it.

#87 Metaxa on 03.28.16 at 1:42 am

Every time we went camping my boys and I took the gold pans along.
Talk to the old timers about where the rivers used to be before logging or landslide moved them, find old works and figure out where the old tailing piles are…etc.
Just poking in the bush, having some fun.

So, 24 years later I find myself with 7 baby food jars all half to 3/4 full of dust, two McDonalds plastic milk containers both around half full of chips, flakes and small nuggets and a single nugget about the size of a lima bean.

If one of you gold bugs were to buy all this from me would I be able to tell Garth that I made $10,000 in a day?

On the Internet no one knows you are a dog.

#88 carboy on 03.28.16 at 2:17 am

Bail in bonds getting snapped up ..If you love these wonderful low interest rates your gonna buy distressed product of a failing bank? really Garth?

No bank is failing. Really. — Garth

#89 Currency Trader #31 Darryl on 03.28.16 at 2:40 am

Find a reputable currency trader out of London – many. Wire transfer money to them. Rate based on ECB. They convert and if you have a bank account in England, or after you get one, they wire transfer Pounds to that account. Only cost is wire transfers.

#90 US Full Employment... on 03.28.16 at 2:49 am

#42 David

FYI, never quote the Economists.

When I was at Western in the mid-80s, my US Economics Prof, in a purchasing power parity lecture, stated that the full employment rate in the US was agreed by the majority of Economists to be at 7% unemployment.

Currently below 5%.

That is full employment and Yellen will continue to raise rates because of this and all else Garth keep repeating in his blog which seems to be largely lost on the Doomers…as usual.

#91 M on 03.28.16 at 3:09 am

Kyle Bass is one of the best in the business mano.
..just got couple of Ks with some BMO puts
..last week a few Ks with puts on spiders
Filled my heart with joy.

..and tomorrow sell some puts on uso.

economy goes very well :)

..about banks.. we’ll wait and see I guess :) all that exposure to housing and oil must have some effects somewhere :) all one has..it’s to look

#92 M on 03.28.16 at 3:48 am

Good ol’ Kyle Bass

https://www.youtube.com/watch?v=dY-F-aGFyt4

#93 Mike in Toronto on 03.28.16 at 3:59 am

#71 Bram

Canada’s not xenophobic, our population is steadily increasing… always at the age of immigration.

#94 TRT on 03.28.16 at 4:17 am

Went to see a business associate who lives just east of the Presidio in San Fran overlooking the golden gate and Alcatraz.

Conversation turned to cars. How Vancouver has way more luxury cars than San Fran (per capita). Wayyyyy more. Obviously you can’t a mortgage on luxury cars so what gives.

The guys at the party came to the conclusion that it’s undeclared money inflows that make Vancouver he luxury car capital of North America.

Wonder if it’s affects housing ;)

#95 TRT on 03.28.16 at 4:19 am

That breeds irresponsible borrowing, and gives us $1.8 million detached houses in Vancouver.

No one gives out mortgages for $1.8 million houses unless you have serious skin in the game. Utter nonsense.

#96 Brazil ex-pat on 03.28.16 at 5:24 am

http://www.huffingtonpost.ca/2016/03/24/chinese-buyers-vancouver-real-estate_n_9535748.html

Nope. No data here. Only bogus stories and made up data counts as real “there is no data”…..data….

As reported, a false story. — Garth

#97 Atta boy, Justin on 03.28.16 at 7:46 am

Present me your argument and let me make my own judgement.

Don’t try to force feed and school the audience with your pre-chewed version of “stupidity” or “good judgement”.

Name calling as an argument is hardly a “good judgement”.

When did you turn secretly into a teacher?

I thought I was just a Liberal-Conservative toadie. — Garth
……..

Atta boy, Justin, your just a celebrity worshiping Magatroyed. It’s an alien race. lowest IQ in the universe. Yet your teachers gave you a I’m smart certificate. So natural you think you got this.

Open up business, lets see how that certificate works out for you.

T2 has no clue, he’s like an author of a fantasy fiction novel that goes no where. And you an adoring fan pledges loyalty to a story that has a unhappy ending for everyone without brain.

Ill be in Ecuador when you start begging, Smokey what should I do.

Atta boy Justin, Atta boy Steven, Atta boy Garth, Atta boy Smokie – I could’t care less which.

It’s low class, no matter who is trying to school you with it.

Tell JD my argument was never about pro or con “T2”, ask him to give you some moments of clarity.

#98 Why Good Journalists Matter on 03.28.16 at 7:59 am

Garth Turner was a journalist and I believe a good one. He exhibited the best of what journalists do which is to pursue stories, gather information, analyze it, and present their findings. Along the way, they had to engage in the ritual skirmishing with the dragons (aka editors) but after a bit of charring, he then proceeded to publish his work.

It is this rigour and almost obsession with telling the truth and trying to untangle the truth from the clutches of those who would obscure it that makes Garth quite valuable. That he does this for free (through this blog) is a blessing. While I may not agree with all that he says (more to the point, I probably don’t understand it), he is an excellent compass, pointing out what is probably the best way forward.

All of you Doom and Boom types, the people who believe that an element on the periodic table is somehow adequate to deal the financial, human, and political complexities of the modern world, should just go away.

#99 Sheane Wallace on 03.28.16 at 7:59 am

#74 crowdedelevatorfartz

It is all about the size of the …. brain my friend, It is all about the size of the brain.

#100 maxx on 03.28.16 at 8:10 am

Raising rates carefully and systematically would ensure that the right parties consumed the right medicine at the right dose, to restore the value of currency and the economy. This would reduce overall debt, but the major benefit would be to the real economy as spending would mostly then originate from healthier wallets.

Saving would be considered a huge advantage as it would result in a much less stressed social safety net. Apart from simple dollars and cents, a less stressed population is a healthier one.

Most with excess debt are a gross liability to Canada’s balance sheet and continuing to support low rates only continues to damage it further.

Compared to our US neighbours, we aren’t even trying.

Canada is unfortunately, if not tragically saddled with long-standing administrative cultural components of reverence for the status quo, incompetence and most notably, laziness.

Exporters ought to be immediately kicked in the pants and forced to deploy their well-honed, consummate survival skills and not have the wrong-headed advantage of the addictive teat of low rates.

Lord knows, ordinary citizens have been force-fed the other side of the coin of that challenge for the past decade and a half.

#101 Hope & Change (Canada) on 03.28.16 at 8:25 am

#86 preet89 on 03.28.16 at 1:29 am
Debt is just a part of life like breathing. Don’t know why the oldies here are so afraid of it.

As Dave Ramsey says (borrowed from the bible):

“The rich rule over the poor, and the borrower is slave to the lender.”

Thus, debt not only makes you poorer, it also limits your freedom. That’s why.

#102 Bobby13 on 03.28.16 at 8:32 am

They can raise rates and print currency at the same time if they need to.

#103 David on 03.28.16 at 8:39 am

#90 US Full Employment…

Thanks for making my point, unemployment is officially lower than previous estimates. So why are you confident that 5% is full employment? The page I linked to was making a case for slack in the labour market suggesting rate increases can wait. Recall the late 90s when unemployment fell below 5% and the fed held rates steady:
http://krugman.blogs.nytimes.com/2015/09/04/the-fed-should-remember-the-90s/?_r=0

I’m no doomer, this isn’t the Great Depression but there is plenty of room for improvement.

#104 BOOM! on 03.28.16 at 8:47 am

#86 PREET89

“Debt is part of life like breathing. Don’t know why the oldies are so afraid of it.”

When we all start out, that is true… We had car payments, student loans, maybe credit card debt that rolled on month-by-month. Later, a mortgage added to the above.

There IS another way. As we get older, we realized the “cost” of carry on DEBT exceeded any price increase in an era of low inflation.

I give you an example you (under 50) have never seen. A time when inflation was raging at 7-8-10-12% a year.

During those heady days of the 70’s and early 80’s savings accounts were paying 5-6% a year. Credit cards were mostly “capped” at 12% interest. When inflation was running in double digits it did not pay to save, but rather to buy on time.

The price of an item rose faster than your savings could accumulate. Think of the current Vancouver Real Estate inflation on everything else. Food, cars, insurance, booze, cigarettes, all the staples of the 70’s…

Your earnings grew, but generally not fast enough to keep up with inflation. Tough to get ahead, the feeling your money was becoming worthless- it was in fact losing purchasing power.

THAT is a reason why we oldies fear debt. That and the fact we have learned to buy from our excess, not future earnings. We realize there may well be no growth to future earnings… not 30 anymore you see.

DEBT at ANY Government level is paid only in 2 ways:

1. higher taxes
2. economic growth

Which one do you think you will see first?

Does that help?

#105 IM in C on 03.28.16 at 8:47 am

Interest rates will NOT be going up for the next 20 years. Why? Because we are poised on the cusp of the greatest transfer of wealth the world has ever seen. There is an ocean of money out there, and more of it is being printed. Basic law of supply and demand.
Oh, and house prices will continue to rise for the next 10 years too. At that point , demographics will come to the fore. The first baby boomers will be turning 80, and entering their enfeebled years. They will be selling their houses in droves. again, basic law of supply and demand

#106 BOOM! on 03.28.16 at 8:48 am

Flopper…

Yes, it’s me.

#107 A belieber on 03.28.16 at 8:52 am

#86 preet89 on 03.28.16 at 1:29 am

Debt is just a part of life like breathing. Don’t know why the oldies here are so afraid of it.
——————-

debt is not a part of my life. But you should definitely be afraid of a large, illiquid, immobile debt like a mortgage. Especially when we have very low-inflation and rock-bottom interest rates.

The real estate strategy that allowed our parents to accumulate a lot of wealth probably won’t work for us. Interest rates can’t fall any further so asset values will plateau (or fall). Low-inflation plus stagnant wages means that our debt burden won’t get any lighter in time.

#108 Q2 Class 4-4-6-4 on 03.28.16 at 9:06 am

Hey Garth –

Not everyone agrees with your Pollyanna-ish view of the American economy – especially Americans.

‘…according to the Bureau of Labor Statistics, the real unemployment rate is close to 11% if you count people who have given up looking for work because they can’t find it, or who are working part-time because they need the money but would prefer to work full-time.’ (USA Today 03/28/16)

A couple of points: 1) The Fed had been expected to raise rates four times this year, now it’s only two, as you mentioned. Next it’ll be once and then not at all. Why do you think the greenback got whacked recently?
2) As for the Bank of Canada wanting to support the currency – don’t hold your breath. The BoC governor is ex-EDC and he really doesn’t have a problem with a cheap CAD. The bank, in its recent survey, even pointed out that exporters were seeing an uptick in orders, due to the ‘more competitive’ currency.

Things aren’t rosey out there, not rosey at all. Until a pro-business American administration is in place – and it might even be Trump, for all you think he’s an idiot – I don’t see any lasting rise in interest rates for, possibly, many years to come.

#109 Herb on 03.28.16 at 9:25 am

Garth, when you were a Progressive Conservative MP under Mulroney, and then Kim Campbell’s Minister of National Revenue, were you as violently opposed to deficits as you are to Trudeau’s?

Yes. That’s why I ran for party leader, hauled a debt clock to Ottawa and hosted debt conferences in Vancouver and the capital. — Garth

#110 BMAC on 03.28.16 at 9:28 am

Garth, the gov’t is suppose to set an example for its citizens. If T2 is big on deficits to excite the economy then so should we. Let’s keep upgrading and buying bigger homes. Our wages are not going up but at least our equity is. Let us all stimulate the economy buy taping into the equity in our home and buy new cars, furniture, support our kids in rep. sports. How do we keep paying for it. Low rates are and will continue to be the new normal. It if funny how you point to the US in terms of future higher rates. The US is divesting from manufacturing. They are like us a consumer based economy. If you haven’t noticed what is driving the US economy is rising house prices and LOC.

#111 Conspiratard on 03.28.16 at 9:29 am

OMG, the Trumps are replicating!!

https://twitter.com/IvankaTrump/status/714228968153460736/photo/1

http://www.usatoday.com/story/news/politics/onpolitics/2016/03/27/ivanka-trump-gives-birht/82329434/

If you add the number value of the letters in the names of all the Trump offspring now together and subtract the true Building 7 Illuminati factor, the number you come up with is

666.

Coincidence? I think not.

I think not.

#112 Smoking Man on 03.28.16 at 9:33 am

#97 Atta boy, Justin on 03.28.16 at 7:46 am
Present me your argument and let me make my own judgement.

Don’t try to force feed and school the audience with your pre-chewed version of “stupidity” or “good judgement”.

Name calling as an argument is hardly a “good judgement”.

When did you turn secretly into a teacher?

I thought I was just a Liberal-Conservative toadie. — Garth
……..

Atta boy, Justin, your just a celebrity worshiping Magatroyed. It’s an alien race. lowest IQ in the universe. Yet your teachers gave you a I’m smart certificate. So natural you think you got this.

Open up business, lets see how that certificate works out for you.

T2 has no clue, he’s like an author of a fantasy fiction novel that goes no where. And you an adoring fan pledges loyalty to a story that has a unhappy ending for everyone without brain.

Ill be in Ecuador when you start begging, Smokey what should I do.

Atta boy Justin, Atta boy Steven, Atta boy Garth, Atta boy Smokie – I could’t care less which.

It’s low class, no matter who is trying to school you with it.

Tell JD my argument was never about pro or con “T2”, ask him to give you some moments of clarity.
…………..

What annoys the hell out of me about you Justin worshipers: the loyalty to being in a gang, that need to tow the line, make sure you always get invited to the party. No slips of the tongue tolerated.

Trained to not use words like Radical Islam, so versed in the etiquette of Political Correctness. To me your all just a bunch of suck ups, mindless followers.

I speak for individualism, tempted to start up a society of individualism, but that would defeat the purpose. Hypocrisy 101.

Freedom is not giving 2 shits if some calls you a, Homophobe, a Misogynist, a Racist, or any other word that by it’s design is to stifle real debate.

Life aint Black and white, lots of grey. It’s not simple.

#113 Herb on 03.28.16 at 9:42 am

#85 Short Change Canada,

re. your first para, definitely – for Conservatives, and yes, they do have to get out of power.

Your second, BS, although it might apply to Right Wing dictatorships, if you can get into the establishment.

Perhaps I should apologize for being so oppositional. I really wasn’t naturally opposed to anything, but years of encountering designated trolls and partisan idiots on the internet have made me that way.

#114 hope & ruin on 03.28.16 at 9:51 am

@ BOOM!

This video went viral amongst the moisters a few years ago. Still at least one radio station in Toronto that plays the clip regularly. Your new name reminded me of it.

and boom! goes the dynamite

#115 Ace Goodheart on 03.28.16 at 9:57 am

RE: #105 IM in C: “Interest rates will NOT be going up for the next 20 years. Why? Because we are poised on the cusp of the greatest transfer of wealth the world has ever seen. There is an ocean of money out there, and more of it is being printed. Basic law of supply and demand.”

This is not entirely true. Have a look at what the bond markets having been doing lately. It looks like rates will be going up soon.

RE: Printing money: Yes, that is exactly what a government is doing if it holds rates low. This doesn’t work. Examples of money printing gone wrong include Greece (remember the Drachma?) Italy ($1000.00 Lira was worth, what, 90 cents CDN?), Mexico (how much can you buy for $10,000 pesos – that is $10.00 CDN).

Canada is going to follow the USA and the bond markets in terms of monetary policy. Yes that will have the effect of crippling the Ontario Government financially (they’re already expecting this and the belt tightening has begun at Queen’s Park) and will also evict about 11% to 15% of Ontarians from their houses (particularly in the boom city of Toronto).

Oh well. We’re all monkeys, and not very intelligent monkeys at that. Those of us with at least half of our brains working, have paid off our houses, stashed cash away in diversified investments, and as usual, when things blow up due to the stupidity of the few, we will just watch and wait for it to blow over.

#116 salonist on 03.28.16 at 10:06 am

the median rent for a one-bedroom apartment in San Francisco is $3,460 a month, according to the most recent analysis by the real-estate marketplace Zumper

This man built a bedroom ‘pod’ because San Francisco housing was too expensive

It cost $1,300 to build. Add that to the $400 a month in rent he pays to live in an apartment near San Francisco’s Ocean Beach, and he’s out about $508 a month.

http://www.businessinsider.com/peter-berkowitz-bedroom-pod-in-san-francisco-2016-3

#117 Sean on 03.28.16 at 10:07 am

If all my investment money is in a TFSA and RRSP. Does it matter what account I buy preferred shares in? I know it makes sense to put those in a taxable account if you are maxed out. In my case does it matter?

#118 Penny Henny on 03.28.16 at 10:12 am

But how much more can the Feds raise rates?
Didn’t they just raise rates in December by 100%?

#119 45north on 03.28.16 at 10:19 am

Go away. Not a vax blog. — Garth

let’s not be hasty

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

#120 WUL on 03.28.16 at 10:27 am

I just arrived at Ft. Mac airport after 10 days with kin in Calgary. Both Westjet flights were one-third full. Now there’s a money losing proposition. Sure makes the flights more enjoyable.

And the guitar arrived undamaged and the golf clubs are confirmed to be at the Greyhound station.

Feeling salubrious.

#121 crowdedelevatorfartz on 03.28.16 at 10:49 am

@#99 Sheane Wallace ( my new 10k per day hero)

“Its all about the size of the…brain”
********************************************

and I had (erroneously) thought it was your sought after “skills” that were in demand.
ie Short “supply” and big “demand”……
Either way. You rock.

#122 crowdedelevatorfartz on 03.28.16 at 11:05 am

@#96 Brazilian ex wax

hmmmmm, you take Huffington Post stories about BC Real Estate as gospel.

Previously bragging about how brilliant you are to move to Brazil because you ( and I quote ” get 13% interest at the bank) and when I post links to the Financial Times and the Wall St Journal about what an economic basket case the Brazilian economy is and how corrupt their politics are……crickets………….

Has President Dilma resigned yet? Has former President Lula been charged with corruption yet? Have any more of their campaign lobbyists been sentenced to 20 years in jail yet? Has the unemployment rate reached 15% yet? Is inflation really 20%? Has the currency dropped 20% in less than a year? Does 13% interest in the bank amount to a hill of beans after inflation and devaluation?
Have they cleaned up the raw feces floating in the Olympic rowing venue yet? Will the subway line to the Olympic venues be ready for opening day in August? Does the govt have any money left for security estimated to be over $1 billion US for 2 weeks? Are locals going to be given free tickets to the events to fill seats on opening day since no one there seems to be buying them? Will tourists stay away in droves because of that pesky Zika thing? Will Russia show up with any “clean” athletes?

But , more importantly, do you live in a highrise building with elevators?

#123 LP on 03.28.16 at 11:16 am

#58 For those about to flop… on 03.27.16 at 10:38 pm
#55 common sense on 03.27.16 at 10:22 pm
#54 Flopper

Your giving Mark far too much credit…2?

///////////////////////////

Hey Common ,I forgot to add that the two darts that hit the bullseye ricochet of the pinball machine…

M41BC
****************************
This thread you’ve got going reminds me of a baseball season of many years ago. Fred McGriff, playing 1st base for the Jays, was having a career year home-run wise. Manny Lee, shortstop for the Jays, may well have been playing great position ball but his home run stats were dismal.

When interviewed after a game in which he did finally hit a home run, he told the reporter that, “Yep, between us Freddy and me have more than 40 homers!”.

Ya just gotta love confidence like that!

F68ON

#124 Felix on 03.28.16 at 11:38 am

Such a cute pic. Two idiot canines trying to lick each other’s ear, impaling themselves on a fence.

How brilliant and predictable.

Here’s another example of why the superior intelligence and resilience of cats will see us take over the planet after the coming Armageddon.

http://www.thestar.com/news/world/2016/03/27/cat-sent-by-mail-survives-8-days-in-box.html

(But we’ll still need a few dogs, and humans too – to lick our butts clean. Such work is beneath us.)

#125 For those about to flop... on 03.28.16 at 11:43 am

#73 liquidincalgary on 03.27.16 at 11:31 pm
@ Marco Polo. you said:

After all, income tax alone was to be only a temporary measure. Once the government has their hand in your pocket, they never let go, it’ll be the same with these fools.

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

is that because they enjoy their hands in our pockets? or is it because we keep expecting the government to keep doing more for us? cradle to grave baby

////////////////////////////////////

Do you guys remember this ad from a few years ago from Capital One…

https://m.youtube.com/watch?v=0EcDpBTuF_8

—————————————-

Boom! @106
The first post I couldn’t really tell but the second post sounded like you.
I was being lazy the other day when I was calling you Boom ,I’m glad you liked it…

M41BC

#126 Herb on 03.28.16 at 11:56 am

#112 SM,

how many “Justin worshipers” have you run across on this blog?

For you freedom also means “not giving a shit” about fact and logic. Verbiage will do nicely.

#127 Bram on 03.28.16 at 12:05 pm

#93 Mike in Toronto on 03.28.16 at 3:59 am
Canada’s not xenophobic, our population is steadily increasing… always at the age of immigration.

And with all that immigration, the median age of Canadian women is 42.9 years. Past child bearing age.

Bram

#128 For those about to flop... on 03.28.16 at 12:21 pm

#123 LP on 03.28.16 at 11:16 am
#58 For those about to flop… on 03.27.16 at 10:38 pm
#55 common sense on 03.27.16 at 10:22 pm
#54 Flopper

Your giving Mark far too much credit…2?

///////////////////////////

Hey Common ,I forgot to add that the two darts that hit the bullseye ricochet of the pinball machine…

M41BC
****************************
This thread you’ve got going reminds me of a baseball season of many years ago. Fred McGriff, playing 1st base for the Jays, was having a career year home-run wise. Manny Lee, shortstop for the Jays, may well have been playing great position ball but his home run stats were dismal.

When interviewed after a game in which he did finally hit a home run, he told the reporter that, “Yep, between us Freddy and me have more than 40 homers!”.

Ya just gotta love confidence like that!

F68ON

///////////////////////////////////

Hey LP ,when I was scrolling down and seen you had responded to my post I thought I was going to get called out for my spelling and grammatical errors( should have been OFF ….could have also written ricocheted ,I guess as well)but your story was from a time before I was here but still cool.

Did you give Robin an Easter treat?
I don’t celebrate Easter but I hope everyone had a good one…

M41BC

#129 Bram on 03.28.16 at 12:23 pm

#94 TRT
Conversation turned to cars. How Vancouver has way more luxury cars than San Fran (per capita). Wayyyyy more. Obviously you can’t a mortgage on luxury cars so what gives.

Excellent point!

Luxury cars are not bought with mortgages.
So yvr luxury houses probably neither.

Bram

#130 Mark on 03.28.16 at 12:25 pm

“But how much more can the Feds raise rates?
Didn’t they just raise rates in December by 100%?”

Not by much more without destroying the FIRE sector. The banks, in particular, addicted to the high margins that low interest rates brought, are particularly vulnerable. The insurers will have their (heavily bond) portfolios destroyed with higher rates. RE will suffer for the obvious reason that its interest rate dependant.

#131 Asthesheepsleep on 03.28.16 at 12:51 pm

DELETED

#132 paul on 03.28.16 at 12:54 pm

#117 Sean on 03.28.16 at 10:07 am

If all my investment money is in a TFSA and RRSP. Does it matter what account I buy preferred shares in? I know it makes sense to put those in a taxable account if you are maxed out. In my case does it matter.
————————————————————-
Just to you!

#133 Hope & Change (Canada) on 03.28.16 at 1:31 pm

#113 Herb on 03.28.16 at 9:42 am
#85 Short Change Canada,

re. your first para, definitely – for Conservatives, and yes, they do have to get out of power.

Your second, BS, although it might apply to Right Wing dictatorships, if you can get into the establishment.

I see that you need an example to help with you with your comprehension.

I recently landed me a Silicon Valley gig, with matching salary, working remote out of Vegas.

I chose Vegas because my wife knows all the big guys on the strip and she can also land a good job there. I would have preferred Florida, myself.

ETA in June, as soon as our Manhattan lease expires. Our rent will be 1500$ for a house with a yard and a pool, compared to 3G for a 1 bedroom in Manhattan. Our taxes much lower than Manhattan as well as most every other costs.

So, Libertarian(ish) state (NV) => High Pay (granted, some pay comes from out of state) / Low Taxes / Low Costs = High Savings Rate.

So Herb, when you can speak from experience about how the rest of us, that haven’t been born in the Trudeau family, can get ahead, please feel free to do so.

Or keep getting angry because other people don’t accept your thinking and prefer moving around, trying, failing, succeeding or just living their own life the way they want to not the way you expect them to.

#134 westcdn on 03.28.16 at 1:40 pm

Life is weird. I had six uncles go to Europe to kill Germans. So who becomes my mentor? A German who moved to Canada after the war. Otto loved to slap my thigh – hurt like hell. I would look at him and ask him why he that. A German thing I guess.

He had two daughters that were most beautiful I have seen in my life. His wife and second daughter liked me.
Unfortunately, at the time I had nothing and zero prospects. I never tried to pursued Shirley.

Otto would take me to the Vancouver Oktoberfest every year with his family. I even still have the beer steins. His daughters would have guys hanging off them.

Life can be a bitch too…

#135 timpietermans on 03.28.16 at 1:41 pm

This is a quote lifted from Mauldin Economics:Canadian Capitalism

Our other neighbor, Canada, managed to avoid much of our last financial crisis, but its turn finally came. Instead of housing, it was energy prices that pushed Canada toward the edge. The country is now in a technical recession, one from which the new Justin Trudeau government promises it will escape by resorting to old-fashioned fiscal stimulus. Keynes himself would be proud.

Will Trudeau fail? Maybe, but it won’t be for lack of trying. The forthcoming deficit spending will add to an already significant debt burden. I would be very concerned if I were a Canadian. Thegovernment is well on its way to amassing the kind of permanent debt burden we enjoy (?) here in the US.

The whole point of fiscal stimulus is to boost consumer demand. Give people cash and they will buy more stuff. Yet lack of demand is not Canada’s problem, especially in the energy-driven provinces. Depressed oil prices are the problem. Trudeau’s stimulus plans will do nothing to raise oil prices. That problem is far outside his control.

I fear Canada will fall into the same trap we (US) are in. We ran deficits thinking they would restore growth, boost tax revenue, and let us pay down our debt. In fact, we got growth that is mild at best, not enough tax revenue, and yet more debt.

#136 Doug in London on 03.28.16 at 2:35 pm

@Mark, post #34:
So, if the gold bugs are so smart, why weren’t they frantically telling everyone to buy gold when it was on sale back in 1999? All I remember that year was some “expert” saying, when gold was about $240/ounce, something like: no one wants gold anymore, it could drop to $150/ounce

#137 NoName on 03.28.16 at 2:38 pm

I cant bilive noone posted this yet….

Never say never

#138 BOOM! on 03.28.16 at 2:50 pm

#125 Flopper…

Yeah, like the new “Name” it sort of fits what is likely to happen over the next couple of years…

I will let YOU decide whether it means great times, or ‘holy snot, what were we thinking’

In the meantime, just finished up my FED TAXES. Seems I need to send the IRS $2,796.00 as I made too dam much money last year. THAT wasn’t supposed to happen!

Yup, double checked the math, the idiot (ME) didn’t quite handle a few things in a tax appropriate manner. Threw a portion of income into the next tax bracket (ouch!)

Totally preventable, but not easily unwound… lesson learned on TAX Planning! Do Canadians encounter CRA gotcha rules like our IRS?

******** NEW IRS TAX FORM 2016 **** *******
EZ Form

1. How much money did you make in 2016?________?

2. Send it in. _________

Thanks!! IRS

#139 BOOM! on 03.28.16 at 2:56 pm

#114 Hope & Ruin

Cute link on ‘Boom goes the Dynamite.’ Thanks!

#101 Hope & Change (Canada)

BEST comment on DEBT. Thanks, should of thought of that one myself! Ancient advice, still true, still works.

#140 Tamsen on 03.28.16 at 3:20 pm

“#61 WalMark of Sadkatoon on 03.27.16 at 10:41 pm

the US economy is fine. the rest of the world sucks

http://www.cnbc.com/id/103498897

Not sure how the US economy can be fine if the average American has only between $25,000 to $50,000 to retire … And:

https://www.linkedin.com/pulse/americas-economy-shooting-blanks-danielle-dimartino-booth?trk=eml-b2_content_ecosystem_digest-hero-14-null&midToken=AQFqY1RGdr3LbA&fromEmail=fromEmail&ut=0n-gozmwFJ5Tc1

#141 Herb on 03.28.16 at 3:31 pm

#133 Short Change Canada,

if I could figure out what this is relevant to, I’d respond.

One point: I actually was born in a Liberal era, but it was that of Mackenzie King. Made it this far, so must have gotten ahead somehow. Good luck in Vegas – you’re welcome to it, and should fit right in.

#142 kommykim on 03.28.16 at 3:31 pm

RE:

#34 Mark on 03.27.16 at 9:14 pm
Maybe the gold nuts are onto something these days after being so ‘wrong’ for so long.

Or maybe they’ll be wrong for even longer. So why gamble? Diversify with a boring portfolio where a 20% stake in the TSX nets you all the gold exposure you’d ever need.

#143 onpar22 on 03.28.16 at 3:34 pm

Thought I’d share this little back and forth I had at my bank recently.
TELLER: I notice you oversee your own investments. Did you know there are people at our branch you can talk to about this?
ME: I did know that.
TELLER: Have you ever talked to somebody here?
ME: Why do you think I oversee my own investments?
Then we both laughed.

#144 WUL on 03.28.16 at 3:40 pm

Mr. Turner:

If I may. Time for a compliment as I suntan in Fort McMisery.

In cowboy country, a very strong compliment that suits you, is:

You are a “Man to Ride the River With.”

Were you out on your scooter today?

Hi to Dot.

#145 understood by few on 03.28.16 at 4:11 pm

#129 Bram on 03.28.16 at 12:23 pm

Luxury cars are not bought with mortgages.
So yvr luxury houses probably neither.

————–

Luxury cars can be bought with a HELOC, so essentially, ya they can be bought with a mortgage.

Obviously the new buyers can’t do that, but I’m sure banks are bending over backwards to lend home owners that bought some time ago (aka paper millionaires) money based on their new found “equity”.

Your logic is poor. More luxury cars (if that’s even true) does not mean foreign money. It just means people are spending more. Lots of ways to explain that away.

#146 Tom from Mississauga on 03.28.16 at 4:20 pm

Sask is down to just one operating rig. So much for have provincial status.

http://www.caodc.ca/rig-counts-drilling-dr-week

#147 For those about to flop... on 03.28.16 at 4:25 pm

#138 BOOM! on 03.28.16 at 2:50 pm
#125 Flopper…

Yeah, like the new “Name” it sort of fits what is likely to happen over the next couple of years…

I will let YOU decide whether it means great times, or ‘holy snot, what were we thinking’

In the meantime, just finished up my FED TAXES. Seems I need to send the IRS $2,796.00 as I made too dam much money last year. THAT wasn’t supposed to happen!

Yup, double checked the math, the idiot (ME) didn’t quite handle a few things in a tax appropriate manner. Threw a portion of income into the next tax bracket (ouch!)

Totally preventable, but not easily unwound… lesson learned on TAX Planning! Do Canadians encounter CRA gotcha rules like our IRS?

******** NEW IRS TAX FORM 2016 **** *******
EZ Form

1. How much money did you make in 2016?________?

2. Send it in. _________

Thanks!! IRS

////////////////////////////////

Hey Boom,as a sub contractor I have to collect gst and pass it on to the Cra.
I used to do it at the start of the year as I didn’t like to do everything in April ,but I messed it up a couple of times as I wasn’t sure what I could deduct from the total.

Now I just file everything together and pay someone $70 to prepare it for me,which makes it all less stressful and I probably come out ahead as they think of things to claim that I would have forgotten.

A man that thinks he knows everything,knows nothing…

///////////////////////

WULLY, I saw it is going to be 21 in Kamloops in the next couple of days,that has to be a record.
Maybe I should have bought shares in Banana Boat…

M41BC

#148 cramar on 03.28.16 at 5:11 pm

#86 preet89 on 03.28.16 at 1:29 am

Debt is just a part of life like breathing. Don’t know why the oldies here are so afraid of it.

—————–

Not afraid. Just avoid like the plague. Debt is NOT a part of life like breathing. Breathing is free, debt is not. Freedom is breathing fresh air on a beach and not having a financial worry.

Two families. One rich. One average.

The rich family buys a million dollar home, has cars, vacation property, all the luxuries for a good life. They paid cash and own them because they can afford to.

The average family wants the good life too. They realize that they can live just like the rich family by buying the same things financed with cheap credit. Debt? No problem!

The in-debt family lives on the same street, drives similar vehicles. They look identical on the outside, but in reality they own nothing except the debt on those goods. Since all income goes to servicing debt, there is nothing left to invest for the future. At some point in time the chickens will come home to roost and they will have to make good on their debts. Stuff happens! It could be job loss, economic downturn, war, a pandemic, or some other cause. Doesn’t matter! Eventually the debt has to be paid. If not by the parents, it will become the problem of the children since the parents died in poverty.

Older people who shun debt realize the universe operates under certain laws. The young haven’t learned this yet. They will.

#149 espressobob on 03.28.16 at 5:43 pm

It’s another hellish month for global index investors. Please, not the distribution thing again. More cash being pumped into our investment accounts.

Frankly this is quite annoying since the bourbon collection is full. Rebalancing is a nuisance, maybe that’s grounds for becoming a goldbug?

#150 Fine Wild Roasted Gonads on 03.28.16 at 6:03 pm

Well this is gonna go well….

“One’s ability to retire in dignity is often driven “partially by luck,” said Morneau, who has advised Ontario Premier Kathleen Wynne on pensions.”

#151 Brazil ex-pat on 03.29.16 at 1:28 am

DELETED

#152 Brazil ex-pat on 03.29.16 at 1:43 am

DELETED