No escape

DOG SIDE modified

There was a time when people in thirsty underwear could smile more. The economy was swelling like a lovesick sponge. Savings accounts paid more than half a per cent. You could put your nestegg in government bonds and earn double-digits. The only challenge was to amass enough money by sex-pill age, then all was cool.

But no more. It’s a low-growth, low-rate, low-inflation, low-return world, with an aging demographic, washed in a patina of debt. As most doomers who come here continuously remind us, this is likely to remain the case. No, not a depression. Or even a protracted recession. Just torpid rates of expansion, flatlined incomes and crappy returns for any investor who needs a guarantee.

But you know this. Commodity prices are at decade lows. Central banks have trashed rates to keep growth alive. Nobody gets a raise any more. Corporate pensions are dying off. And now the new government in Ottawa has to overspend by thirty billion a year to sustain the economy.

None of this can you change. But you can certainly adapt. Smart investors will understand the old model no longer hunts. As I’ve said often, the greatest risk now is not losing money in an investment that declines, but running out of it. Given tediously-long lifespans and diminishing returns, you cannot afford to invest the way your parents did. Bond coupon-clipping is kaput. GICs are financial death rattles. High-interest savings accounts are an oxymoron. If you have no stomach for some market volatility, you’d better have a couple of million in the sock drawer by the time you quit work. If not, here’s a plan.

First, go where the growth is in order to grab some. These days, that’s south of the border.

“The US economy may be slowing relative to previous decades, but you have to recognize the country’s incredible ability to innovate,” says portfolio manager Doug Rowat. “Such innovation can instantly spur growth despite unfavourable demographics.” Of course. No mistake that the largest companies in the world, as gauged by their market capitalization, are American. Where would we be these days without Apple or Google, Exxon, GE or Amazon? The essence of Americanism is innovation. Technology rules. Be there. And did you catch the jobs numbers Friday morning? Another home run.

I’ve told you many times to be underweight maple and to never bet against America. This runs counter to the portfolios most people have, peppered as they are with Canadian banks and energy companies. But the largest holding in the growth portion of your balanced 60/40 portfolio should be US equities – about 21%, compared to a max of 17% for the beaver stuff. Ensure this is well diversified, with ETFs holding large, medium and small cap companies.

Speaking of equities, you will regret not owning them – or enough of them – in the world now unfolding before us. No, this does not mean loading up on a bunch of penny stocks your BIL heard about from his dog-walker. Nor does it mean buying a slew of expensive equity-based mutual funds from [email protected]

Given the sea of debt upon which we float, interest rates will take a long time to reach historic norms. Yeah, they’ll go up. But we are not going back to the levels the wrinklies still dream about. At least not in your lifetime. Keep some bonds in a balanced portfolio to reduce volatility and counterweight occasional equity drops, but keep the weighting to 20% of the entire portfolio, and ensure you have high-yield and corporate bonds in there as well as low-octane government debt.

Mostly, forget the old rules. Like the one that says equities should form no more of your portfolio than 100 less your age. Anybody retiring now, dependant on their assets for income and planning to live another two or three decades, would be best off with 60% in the markets. Diversified. In the right regions. In ETFs.

Finally, whatever you might think of China, India, or Brazil, you should own them. Yes, I understand things can get volatile, which is why you need a low weighting (maybe 1% for China, compared with 10% for Europe). But over time the weighting to all emerging markets should increase, because that’s where the greatest future expansion lies.

These areas are populated with legions of young people, have rapidly-growing economies (Canada 1%, China 7%), swelling populations and big appetites for stuff the rest of the world produces. The most voracious middle class is no longer in the USA, but in China. There are a few good ETFs around that will offer you an appropriate exposure. Just don’t load up on the Shanghai index unless you have danglies of steel.

The best lesson about money anyone can learn is the nature or risk. It’s everywhere, in every activity, each day. Running from it is not a strategy. Even staying in cash exposes you to currency and inflation risk. Chasing yield has proven to be a mistake. Ditto for buying things at the top, just because everyone else is.

You’ll never have a fulfilling life by avoiding risk, running with the crowd or shunning trouble. Hell, look at me.

214 comments ↓

#1 Ned on 04.01.16 at 6:22 pm

So how does one do that?

#2 Grey Dog on 04.01.16 at 6:23 pm

It is absolutely amazing how much space 16 pounds of grey fur baby can take up AND yes I find myself hugging the edge of the mattress!

#3 X on 04.01.16 at 6:25 pm

So if there is 2, .25 point increases in the Fed lending rate this year, and 4 potentially next year, what would that make mortgage rates look like here….what would that potentially drive bank posted rates up to for early 2018?

#4 Brazil ex-pat on 04.01.16 at 6:26 pm

I agree with everything except the continued touting of “low inflation”. The Govt of Bring Cash continues to raise fees, taxes and levies at double digit rates or close to it.

And a note about Brazil to verify your blog today – the average age of a Brazilian today is 29. And yes they are very hungry for modern technology and conveniences. That is why I am here. And you will learn of what the company I am engaged with is doing here and why we chose Brazil to launch. Amid all the political turmoil it will still be an exciting time to be involved in tech.

Cheers

#5 April. on 04.01.16 at 6:26 pm

Thank you.

#6 mitzerboy aka queencitykid on 04.01.16 at 6:28 pm

Once again garth u hit a home run with your words
thx

#7 Wooba on 04.01.16 at 6:29 pm

I’m looking for some advice from the blog dogs who’ve moved abroad. I’m about to leave Canada and move to Australia. I’ve been reading conflicting reports about what I can keep active in Canada in order to become a non resident for tax purposes. Does anyone have any experience with this? I’d like to keep my bank account and a credit card if I can. Any other advice from other expat Canadians greatly appreciated!

#8 crowdedelevatorfartz on 04.01.16 at 6:30 pm

Oh God why did you have to mention Brazil in a positive light?
Brazil Ex Pat is insufferable enough as it is……..

#9 marcov on 04.01.16 at 6:30 pm

To paraphrase Mark Twain: There are lies, damned lies, and government statistics…

The Big Lie: 5.6% Unemployment (Feb 3, 2015)

http://www.gallup.com/opinion/chairman/181469/big-lie-unemployment.aspx

#10 jaybee on 04.01.16 at 6:31 pm

If you’re investing in Brazil; expect some volatility. I’ve been long US for awhile now, and I’m starting to dip my toes back into Maple. Slowly but surely.

PS Mark, you are a douche, and you have no freaking idea what you are talking about. Do you even have a job?

#11 Joe2.0 on 04.01.16 at 6:32 pm

Great snap
Replace dog for bank.

#12 explain rule of 90? on 04.01.16 at 6:34 pm

If you have 1million cash
and I am 40 years old.
90-40= 50% in real estate assets is okay.

that means, e.g. 1m house with 500K down, 500K mortgage, and still, 500K balanced portfolio.

Correct?

Using this logic, I don’t see how anyone can buy a place unless they have 2million+

And yet, anyone who bought real estate in the last 10 years is probably laughing.

#13 Gary in Halifax on 04.01.16 at 6:36 pm

Garth..I very seldom post but have been a reader for years. I just want to say I appreciate so very much your daily hard work,and your realistic and truthful handle on all things involving our economy and how to make the best of our situation in these volatile times. Thanks, Garth..

#14 ILoveCharts on 04.01.16 at 6:39 pm

There is one asset class that has been outperforming quite well…..

#15 Victoria Real Estate Update on 04.01.16 at 6:42 pm

VANCOUVER VS VICTORIA: A COMPARISON OF HOUSING MARKET PERFORMANCE

. . . . . . . . . . . House Prices. . . . . . . . . . . .
. .Percent Above/Below June 2008 Price Level.
. . . . . . .x = Vancouver, * = Victoria . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
+45% . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . x. . .
+40% . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
+35%. . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
+30% . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
+25%. . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
+20% . . . . . . . . . . . . . . . . . .x. . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
+15%. . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
+10% . . . . . . . . . . x. . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
+ 5%. . . . . . . . . . . . . . . . . . . . . . . .*. . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
….0%. . . x*. . . . . . *. . . . . . .*. . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
– 5%. . . . . . . . . . . . . . . . . . . . . . . . . . . .
————————————————————————–
. . . . . . June. . . . .June. . . . .Aug . . Feb. . .
. . . . . . 2008. . . . 2011. . . . 2014. . 2016. . .

(source: Teranet’s index)

PERFORMANCE SINCE 2008:

House prices in Vancouver have skyrocketed higher by 44% since June 2008. Over the same period of time, house prices in Victoria increased by only 6/%, based on Teranet’s data.

PERFORMANCE OVER THE LAST 3 MONTHS (based on Teranet’s data):

Vancouver …….vs….Victoria
Dec.: +1.1% …vs… +0.01%
Jan.: +0.85% …vs… +0.72%
Feb.: +3.24% …vs…+0.91%

Teranet’s data shows that there’s no comparison at all between the two cities in terms of housing market performance.

That hasn’t stopped local real estate “professionals” (and the media) from trying to convince you that Victoria’s housing market has experienced Vancouver-like price gains lately.

This is being done to create fear and panic buying. Clearly the motivation for doing this is self-serving.

There’s been a lot of house pumping by the usual suspects in Victoria over the years and it seems to have increased within the last year.

What about the claim that wealthy buyers from China had “suddenly discovered Victoria“? The local media had quoted real estate “professionals” about this.

Sales stats show that claim was/is false. An internal report from Victoria’s R/E board shows that only 0.68% of buyers came from Asia (see chart).

We heard the same kind of unsubstantiated, fear-mongering claims in 2010, immediately before SFH prices in all areas of Greater Victoria fell significantly.

Price decline from 2010 peak:
Victoria (city): -11%
Oak Bay: -11%
Central Saanich: -14%
Highlands: -18%
(Source: The Victoria R/E board’s home price index) Note that prices in these areas likely fell deeper than stated above since the information comes from the local board’s frankenumber price index.

Many of the local families who have bought at today’s extremely overvalued prices will be facing severe financial problems in the future as a result of being encouraged to enter the housing market at this time (before house prices fall to the deep bottom that awaits).

These local families will face even worse financial problems than the families who bought in 2010 and sold after prices fell in Victoria.

BUYERS BEWARE!

Potential buyers are also being told the following things:
* That mortgage rates won’t rise.
* Rising rates wouldn’t affect house prices.
* That current market conditions in Victoria (sales/listings, supply/demand) are the new norm. You’ve read comments like these on Garth’s blog.

These claims are, of course, false. Housing “professionals” say these sorts of things to make you feel confident about buying and to bring about panic buying. It’s all based on unsubstantial claims. It works for a while – until house prices inevitably begin to fall.

In the US, the cities that experienced the most panic buying as the American bubble inflated were among those that experienced the biggest price declines.

It’s not a good time to buy in Victoria, just like it wasn’t in 2010. Buying now would be putting your family in a really bad financial situation in the future. Wait for Victoria’s housing market to correct/correct further.

#16 Smudgekin on 04.01.16 at 6:44 pm

A wild card would be a dirty bomb. Obama had a meeting today and our JT pledged a few mill.

You have radioactive waste spreading through a few cities and it would question the whole concept of home ownership.

#17 tundra pete on 04.01.16 at 6:47 pm

Definately invest in the countries that make products that the middle class and mid age like to consume.

Not like Canada where almost all the manufacturing of the products the world wants has been off shored to other countries with the nod of a government, who was bought out with corporate greed. The remaining jobs will be fought over mma style in fast food restaurant parking lots by laid off oil workers and techies.

#18 Herb on 04.01.16 at 6:50 pm

#7 Wooba,

forget apocryphal information on tax. Go to the bible, the CRA website, but know that CRA also has been known to ignore its own published administrative policies should push come to shove.

Bank account and credit card will be significant ties that will be held against you.

#19 james on 04.01.16 at 7:02 pm

#4

Well, Brazil might have lots of young people interested in the future, but it has long been a country of the future. In 100 years it will probably still be the country of the future.

Plus it has a high level of violent crime in many cities.

At least if I work in Silicon Valley or Seattle I don’t have to worry about being kidnapped or carjacked.

I’d rather be in Medellin or Santiago or even Montevideo, if I were starting a software company in South America. To each their own. Good luck with your venture.

#20 Sue Me on 04.01.16 at 7:09 pm

I should understand this, but I don’t:

If a government is running a deficit how do we know if we are borrowing this money or creating it? If the government is borrowing then we increase future risk and sensitivity to interest rates, correct? If the government is monetizing then that increase in supply should in theory drive up interest rates?

It just seems that a deficit government should somehow relate to a higher interest rate. What am I missing? How much “control” does the government actually have on interest rates?

SueMe

#21 MicroGX on 04.01.16 at 7:12 pm

Thanks, I value and appreciate the consistent message.

#22 TurnerNation on 04.01.16 at 7:13 pm

Using blog dog argot, equity markets are gitting ‘er done boys. Volatility is in hiding.

#23 Basil Fawlty on 04.01.16 at 7:14 pm

The US jobs report claims that of 215,000 positions created in March, 37,000 were in construction. At the same time, the Census Bureau also reports that construction spending is in a downturn.
I smell baloney.

#24 not 1st on 04.01.16 at 7:17 pm

Garth, just some counter balance. The BRICs are loaded with debt, corruption and shadow lending. And Europe is heaven for central bank machinations.

Canada looks down right hot compared to those regions. Might be talked into putting a token 1% of my wealth there but that would be it.

#25 common sense on 04.01.16 at 7:18 pm

#17 Tundra Pete

What is this thing “The Middle Class” that you speak about?

Please explain…

#26 Frustrated Retiree on 04.01.16 at 7:19 pm

“Mostly, forget the old rules. Like the one that says equities should form no more of your portfolio than 100 less your age. Anybody retiring now, dependant on their assets for income and planning to live another two or three decades, would be best off with 60% in the markets.”

I’m 65, and I do depend on my portfolio for income. I understand your logic. But 60% still is a scary big number to me, after having witnessed 2008. Would you recommend that a big chunk (say two thirds) of that 60% be large blue-chip dividend payers? Or should it all be in broad market ETFs, split evenly between companies of all sizes?

Greater diversity equals reduced risk. Canadian energy companies used to be blue chip. — Garth

#27 Whinepegger on 04.01.16 at 7:30 pm

OK. What am I not getting? If the ‘Buy Low, Sell High’ mantra is still in play, why are we not being advised to stock up on commodities, including oil. They look like a bargain.

If the only rule was to buy cheap, we’d all have a place in Detroit. — Garth

#28 prairie person on 04.01.16 at 7:31 pm

In spite of one regular poster who never does anything but dis the housing market in Victoria, houses in the area in which I live are selling as fast as they’re going on the market. Two condo units sold out immediately. Prices are up and are now substantially over assessed value. Everywhere I look there are sold signs. Making a comparison to Vancouver is irrelevant. Just try buying a house in James Bay, Fairfield or Cook Street village. When a poster makes a career out of one message, don’t buy in Victoria, you can be certain that it isn’t for the benefit of the readers. Maybe he’d like to tell us who he is so we can get an understanding of his motive.

#29 Ponzius Pilatus on 04.01.16 at 7:34 pm

Garth,
Taxi drivers and shoe shine boys are no longer in vogue as investment advisor.
I hear dog-walkers are all the rage now.
I don’t have a dog, but I’m thinking of getting one.
A small one, so he does not eat too much.
And then I hire a dog walker.
But first I’ll check with CRA to see if I can claim the dog and the walker as investment related expenses.

#30 Ace Goodheart on 04.01.16 at 7:37 pm

RE: “First, go where the growth is in order to grab some. These days, that’s south of the border.” I believe this is incorrect, with the exception of a very few equity investments. Firstly you are buying US equities, with Canadian dollars. So you are losing 30 cents on ever dollar. When the CDN dollar goes back up, this will be a painful lesson.

Secondly, really if people want to make money in equities right now, what they should be doing is buying high quality Canadian preferreds and REITs. If people have a bit more of a stomach for risk, there are also a bunch of oil companies on sale (but be very careful here).

There are a number of companies traded on US exchanges I’d want to own right now. One of them is based in the Netherlands and used to make LED light bulbs (but now makes medical equipment). Another makes semi conductors, and was actually spun off from the LED bulb maker.

RE: emerging markets: Yes sure go buy equities in Brazil and China. You really have to understand how these places work before you start purchasing in their markets. Go live in Brazil for a couple of years. Then decide if you want to own shares in their industries.

Lastly, what about the bond markets? Why not purchase some junk? There are so many good deals on junk bonds right now it is ridiculous. I mean, if you buy a group of this stuff, and half of it goes bust, you still are making huge amounts on the other half. It is a win win situation. Bond markets continue to exhibit signs of a deep freeze. There is lots of quality stuff out there that is not being bought. It is a buyer’s market.

You certainly do not need to convert C$ to have US exposure. The rest of your comment was equally accurate. Keep your day job. — Garth

#31 For those about to flop... on 04.01.16 at 7:39 pm

I gave a few insights into my neighborhood this morning.
A lot of the renters in the immediate area are long term.

We were probably brought into be mortgage helpers ,but now I guess for the ones that have paid that off we need to be kept around to help pay for Property Taxes and all the other costs that come with owning a home.

The houses are roughly going for 1.3/1.4 some are asking but not getting 1.6 but there is no flashiness in the neighborhood.I guess coz they spent all their money on a house!

People dress casually and you won’t see any fancy handbags.No real flashy cars, one guy has a Bentley but It hasn’t been well kept.

Where I grew up every house had a driveway and you put the garbage out front ,no alleys.
The guy with the Bentley not only parks in on the street ,but on a bike route as well.

Where I live is not paradise,but i could do a lot worse as well.A few homeowners have sold and moved to Surrey but most people that own the houses realize that it is a good area ,fairly quite and peaceful considering Knight St is only 6/7 blocks away.

I will never be a home owner in this area,but I’m o.k with that because thanks to my new life coach,that’s not my main goal in life anymore….

M41BC

#32 Ponzius Pilatus on 04.01.16 at 7:45 pm

Not sure about the USA hedging its bets on being a leader in innovation.
Looks like pretty much every citizens of this planet has a cell phone now.
And, with every new technology comes the demise of an older one.
Zero sum game.

#33 Ponzius Pilatus on 04.01.16 at 7:48 pm

As long as the job stats do not reflect FTEs, I really don’t think they are too accurate.
If we’re converting too many jobs into part time, who’s the winner?

#34 -jwk- on 04.01.16 at 7:51 pm

#7 wooba you need to cut all ties. In or out. Decide. A bank account and a credit card are likely too much as they indicate intention to return. If you quit Canada entirely, you don’t have to file in Canada (but may want to anyway)

That said it may not be relevant as Australia and Canada have a tax treaty – so you won’t be double taxed on income. With the treaty you are considered a non-resident for tax purposes anyway. You still have to file, but you get credit for taxes paid in australia – about the same as Canada . (https://www.fin.gc.ca/treaties-conventions/austral2-eng.asp)

#35 down and out on 04.01.16 at 7:52 pm

http://windsor.ctvnews.ca/video?clipId=841127 These house pumpers have changed Southwestern Ontario into a pit of vipers .Happened so fast I find it surreal.No explanation what lit the fuse .This old geezer is in awe on my weekly drive to the city every thing seems to have a sold sign .If it was not for this blog I am afraid I would get to bank then join in and run with the herd ,have people lost their minds .

#36 -jwk- on 04.01.16 at 7:52 pm

#7 wooba – oh and there is a form you can fill out, send to the CRA and they will assess your status. They always say you are a resident. And then they know where you live. Don’t do it!

#37 practicalstudent on 04.01.16 at 7:53 pm

Good advice. Will look closer at non-north american markets for long term investing.

Have a good weekend all.

#38 waiting on the westcoast on 04.01.16 at 7:54 pm

#19 james says… “I’d rather be in Medellin or Santiago or even Montevideo, if I were starting a software company in South America. To each their own. Good luck with your venture”

I was in Santiago, BA, and Montevideo in Q4 last year chatting with investors and lawyers/accountants about opportunities in tech. Pretty slow. Good for service bureau type businesses: localization, building apps, etc. But not great for building the next big thing (except Santiago which has a very driven culture). I am looking at Ag tech for Argentina and Uruguay. Lots of opportunities to scale there.

#39 Victor V on 04.01.16 at 7:57 pm

Cenovus to slash additional 440 jobs in cost-cutting effort

http://www.bnn.ca/News/2016/4/1/Cenovus-to-slash-additional-440-jobs-in-cost-cutting-effort.aspx

#40 Hotdogs from Heaven on 04.01.16 at 8:00 pm

#23 Basil Fawlty on 04.01.16 at 7:14 pm

The US jobs report claims that of 215,000 positions created in March, 37,000 were in construction. At the same time, the Census Bureau also reports that construction spending is in a downturn.

I smell baloney.
———————————-
I don’t know. All those new jobs in the last few years and a saving rate that has surpassed 5% now has those folks down south socking away almost $8.5 TRillion dollars in their saving and chequing accounts, even with them paying almost no interest. That money didn’t get earned by people not working.

https://research.stlouisfed.org/fred2/series/WSAVNS

#41 Trillion $ question on 04.01.16 at 8:07 pm

#20 Sue Me on 04.01.16 at 7:09 pm
I should understand this, but I don’t:

If a government is running a deficit how do we know if we are borrowing this money or creating it? If the government is borrowing then we increase future risk and sensitivity to interest rates, correct? If the government is monetizing then that increase in supply should in theory drive up interest rates?

It just seems that a deficit government should somehow relate to a higher interest rate. What am I missing? How much “control” does the government actually have on interest rates?

—-

No worries, nobody does.
It’s the trillion dollar question.

#42 Warren - the lagging indicator on 04.01.16 at 8:07 pm

Some are concerned the higher Bank preferred share yields signify trouble ahead. This is not the case.
The preferred space has many positive factors in favour of smart new purchase. One being the influx of institutional demand, for example the TD Bank Series 12 offering, where the entire $400 million upsize due to high demand went solely to institutional investors. Another positive is the the introduction of fixed-resets with a floor on the reset rate although the Canadian banks are not eligible to incorporate floors in their Non-Viability Contingent Capital preferred shares and therefore have to offer higher yields as high as 5.6 percent. These issuances will all trade near or above issue and will likely be called on next reset. The real deal here are the lower spread quality preferreds without a floor on the reset rate (as if rates are going any lower) that have sold off to compete with the new issues on a yield basis. These are becoming perpetual-esque in nature due to the unlikelyhood of a call. The low spreads offer higher leverage to interest rate hikes for equivalent current yield. Look for resets on quality names past 2018 and you will be rewarded with capital appreciation along with good income. The uninitiated should really stick with the ETF’s though.

#43 Pinky Has A Cane on 04.01.16 at 8:08 pm

#7 Wooba . Last year my Son’s 23 year old bud moved to Sydney with his new Ausie girl. He’s back already. The Ausies have perfected a way to preserve their jobs for their own citizens. Outsiders are unwelcome. “Sorry mate”. But as usual the’re be a whole bunch of people on this site that disagree so best go figure it out for your self. Blow a bunch of dough and see.The kid wouldn’t listen either.

#44 Pinky Has A Cane on 04.01.16 at 8:12 pm

#10 Jaybee

Ouch!! Pretty disrespectful. Wow! That’s gonna hurt.

#45 not 1st on 04.01.16 at 8:16 pm

Garth, one of your disciples who bought individual stocks and buys covered calls on them.

http://www.theglobeandmail.com/globe-investor/investment-ideas/how-one-investor-boosts-his-dividend-yields/article29498694/

#46 NOTHING SURPRISES on 04.01.16 at 8:20 pm

#7 Wooba

To become non-resident you cannot own any property, investments, insurance, mortgage etc., vehicles, drivers license or other assets in your name in Canada.

You must be totally out of Canada for a minimum of two years ..no visits during that period!

Establish a residency in another country, preferably a low tax jurisdiction.

If possible obtain another passport from this other country, have dual citizenship, possible for example if your parents or grandparents came from the British Isles you should be eligible for a passport say from Ireland (lower income taxes) .

After establishing non-residency you will not be obligated to pay Canadian income taxes.

Pensions can still be available from Canadian sources.

You do no surrender your citizenship, only your residency status.

#47 Fine Wild Roasted Gonads on 04.01.16 at 8:22 pm

#24 For those about to flop… on 04.01.16 at 7:39 pm

Hey Flopper..

“I will never be a home owner in this area,but I’m o.k with that because thanks to my new life coach,that’s not my main goal in life anymore….”

I hope your life coach is a case of beer….

#48 crowdedelevatorfartz on 04.01.16 at 8:29 pm

Hmmmmm.
Apparently Tesla may need MORE money to get those cars built…..

http://www.reuters.com/article/us-tesla-model-idUSKCN0WY3JK

#49 For those about to flop... on 04.01.16 at 8:32 pm

Speaking of volatility in India and and China,when I started to think about what to fill my TFSA with ,I filled it mostly with vanilla products but at the end I thought India or China for the X factor.China looked overdone and since crashed.
India on the other hand looked reasonable but proceeded to go down as well to the tune of around 30%

I seem to have had the same conversation with myself that some people holding Preferreds are asking themselves-what do I do now?

My India fund is still extremely volatile,and will always be ,but I held my nerve and it has come back up 11% in the last month.

I have been investing small amounts of money ever since I was 17 and didn’t crystalize any losses during the GFC ,but I’m thinking if it ever gets back to even I will put it into something a little more boring…

After all if I want a heap of excitement I can always call Mark Farquar to talk about the sales mix…

Go Flyers…

M41BC

#50 For those about to flop... on 04.01.16 at 8:34 pm

#47 Fine Wild Roasted Gonads on 04.01.16 at 8:22 pm
#24 For those about to flop… on 04.01.16 at 7:39 pm

Hey Flopper..

“I will never be a home owner in this area,but I’m o.k with that because thanks to my new life coach,that’s not my main goal in life anymore….”

I hope your life coach is a case of beer….

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

I’m sure Garth has been called worse…

M41BC

#51 crowdedelevatorfartz on 04.01.16 at 8:38 pm

And not to be outdone we have the latest from Brazil!
The vice president who may become the leader after his boss is impeached for corruption.

http://www.reuters.com/article/us-brazil-politics-temer-idUSKCN0WY5E9

“the Butler” as he is know to friend and foe alike once worked as an assistant to a Governor who’s motto was ” He steals but gets things done…….”

Democracy in Brazil is almost as interesting as a US Presidential election these days….almost.
Nobody trumps Trump.

Alas another billionaire charged with corrupting Brazilian politicians…..will it ever end?

http://www.reuters.com/article/us-brazil-corruption-safra-idUSKCN0WX2MD

#52 Joe on 04.01.16 at 8:39 pm

Why is Canada such a lax country when it comes to letting criminals in?

http://blogs.vancouversun.com/2015/11/21/mass-immigration-fraud-adversely-impacts-canadian-society/

#53 crowdedelevatorfartz on 04.01.16 at 8:41 pm

@#47 Fine roasted unmentionables
“hope your life coach is a case of beer….”
********************************************

Yep. And Ms. vodka, and Mrs. rye, and Mr. rum and innumerable beersh…….

Smokey….over to you

#54 Investx on 04.01.16 at 8:43 pm

“Interest rates will take a long time to reach historic norms”

Noooo really?

#55 common sense on 04.01.16 at 8:48 pm

#52 JOE

Ahh me thinks..Money.

#56 Nemesis on 04.01.16 at 9:06 pm

“Just don’t load up on the Shanghai index unless you have danglies of steel.” – HonGT

#InvestingInEastAsianCapitalMarkets?… #LookingForOrientalDangliesOfSteel?…

http://tinyurl.com/hasregd

#No!…. #YouNeed… #Occidental!… #”BallsOfFury”… #MPAA-PG13

https://youtu.be/oaAG1ch69jU

#57 Ole Doberman on 04.01.16 at 9:12 pm

Gartho weren’t you the one saying over a decade ago the DOW was going to 30,000?

I think it was in one of your books I read – do you still hold to this conviction and do you believe the health sector will be the place to be as billions of wrinkly boomers will need old dude services?

#58 For those about to flop... on 04.01.16 at 9:13 pm

The government of B.C knows that 93,000 people earn minimum wage,they track that.

How much foreign ownership in B.C ,not real sure…no data…

M41BC

#59 Ace Goodheart on 04.01.16 at 9:15 pm

Re: “You certainly do not need to convert C$ to have US exposure. The rest of your comment was equally accurate. Keep your day job. — Garth”

Don’t agree with you. You are way too hard on the CDN investment scene. There are always tons of good deals here in equities and bonds.

And are you seriously advising people to invest in Brazilian equities? The country is about to enter a civil war and be bailed out by the IMF. I mean, are you kidding me?

An emerging markets ETF, of course. Where did I ever say to buy Brazilian equities? — Garth

#60 Wooba on 04.01.16 at 9:16 pm

#36 -jwk- on 04.01.16 at 7:52 pm

I’ve read that many people have been able to keep a bank account without any issue. But as others suggested, CRA probably don’t always follow their own rules.

I’m confused about the form you were talking about and not filling it out. Since I’d have to fill in a tax return the year after I leave (for the year that I leave) they will know my address anyway, will they not?

#43 Pinky Has A Cane on 04.01.16 at 8:08 pm

You make a good point but there’s compelling reasons for me to go which I won’t get into here. However, I have a skill that seems to be in demand, so I’m hopeful I can get my foot into the door without much effort. I’ll have the relevant Australia qualifications by the time I land.

#46 NOTHING SURPRISES on 04.01.16 at 8:20 pm

Pretty much what I’ve read, but I don’t think you’re correct about not being able to visit however.

You brought up a good point about the pension. I’ve got a pension with my current employer (13 years). When and how can I extract that? What about my RRSP. Can I leave that, can I transfer it?

Thanks for advice.

#61 WalMark of Sadkatoon on 04.01.16 at 9:17 pm

good article about risk. unfortunately most Canadians are sold the idea of risk = being left behind. we’re doomed

#62 hope & ruin on 04.01.16 at 9:18 pm

good post, I agree 100%. I think the next decade could be bumpy/scary at times but we will come through at the other end. The GFC is over and the recovery is slow but real. Will we ever get a post discussing the TPP and markets?

#63 TurnerNation on 04.01.16 at 9:18 pm

#16 Smudgekin it’s the same duck and cover.scare tactic from the 1960s. Goal, they want to steal our cash. T2 bit the extortion and handed over 42m of our cash.


Imagine, USA spends more on defense/killing technology as all other First worlds combined.
Yet we’re told a rag tag group of men armed with 50 year old technology (small arms) is holding us hostage. As if. Yet they always are known, photos splashed on front page. Same script each time.
And 101 new laws against our freedom of movement are rolled out.
Apparently they have no demands. No dislike for our freedoms or little girls going to school. ( That was the old marketing plan.)

In fact there’s a camera and microphone trained on me as I write this! Google and Siri too. Listening live via the selfie camera and microphone of my “Smartphone”…all tagged via Gps.
I’ll turn in my collaborators…online friend lists. Papers please. Everything old is new again.

#64 Rube Goldberg on 04.01.16 at 9:19 pm

# 52 Joe
More lies from that racist anti migrant piece of trash they call a news paper. The Sun is about to fold like a cheap umbrella.The Sun is so desperate they’ll print anything.They can’t prove these nice people are criminals.They don’t have any information on them.Leave them alone! Sick of it!!!!

#65 For those about to flop... on 04.01.16 at 9:21 pm

Ha! B.C real estate board going to possibly use private eyes to keep an eye on its members.

I sense a comeback from Hall and Oates…

M41BC

https://m.youtube.com/watch?v=JsntlJZ9h1U

#66 Steerage Bilge on 04.01.16 at 9:25 pm

For smokey… a selfie with Butt.

https://pbs.twimg.com/media/Ce58I7fUAAAqXa5.jpg:large

#67 Wooba on 04.01.16 at 9:28 pm

Looks like from the CRA website I CAN keep a bank account:

If you leave Canada and keep residential ties in Canada, you are usually considered a factual resident, and not an emigrant. However, if you are also considered to be a resident of another country with which Canada has a tax treaty, you may be considered a deemed non-resident. Deemed non-residents are subject to the same rules as emigrants.

#68 TCContrarian on 04.01.16 at 9:38 pm

“The best lesson about money anyone can learn is the nature or risk. It’s everywhere, in every activity, each day. Running from it is not a strategy. Even staying in cash exposes you to currency and inflation risk. Chasing yield has proven to be a mistake. Ditto for buying things at the top, just because everyone else is.”

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

With this I agree, totally. For this reason, I’m not buying SP500/DJ equities – in fact, I’m shorting them.

Long China and other emerging markets.
Also, long gold, commodities, energy – not because they’re ‘special’ or anything. But they are low…

My favourite way for managing ‘risk’ – when you pay the least $$ for an asset (works for any asset class, including RE).

#69 hope & ruin on 04.01.16 at 9:45 pm

This weeks reading is a book by Alan Greenspan: the map and the territory. I know a lot of people here don’t think much of him or other central bankers but he is a really intelligent man and it’s easy to read. Very cerebral in his approach and draws on his technical experience plus some anecdotes and trends that he notices.

#70 ANON on 04.01.16 at 9:47 pm

The economy was swelling like a lovesick sponge.

Does that mean what goes up will come down no matter what?! There must be something someone can do, and someone is certainly responsible for this! I have to admit I don’t remember the blame-trend of the week, though, it’s been a while…but it’s Their fault, alright!!!

#71 Tesla on 04.01.16 at 9:52 pm

#48 crowdedelevatorfartz on 04.01.16 at 8:29 pm

Hmmmmm.
Apparently Tesla may need MORE money to get those cars built…..

http://www.reuters.com/article/us-tesla-model-idUSKCN0WY3JK

So what? The world is awash with cheap money… especially if you have demand for what you produce…

From the $1K deposits Tesla just raised $200 million interest free cash… try this yourself, if you can…

#72 BallsofSteel on 04.01.16 at 9:56 pm

” unless you have danglies of steel.” Well, that would be me.

#73 BOOM! on 04.01.16 at 9:56 pm

Another fair day in the markets. That ol’ diversified portfolio has been doing very well, thank you.

No GIC’s, no precious metals, just stuff I get paid for owning. Preferred, Bonds, ETF’s and a handful of good dividend payers, too. Total stock market index, Healthcare REIT, real estate REIT.

Naw, it is never “perfect” I’m not perfect, what’s your point? It pays decent dividends, grows mostly with the market returns, and someday I’ll hit room temperature, but I probably will NOT have run out of money first.

So, why not enjoy my family, friends, and life every day along the trail. I can’t see a better more stress-free way.

Thanks to the great advice over the years, Garth. At least you know some people have been listening to ya.

Should it all go bust, well… I surely won’t be alone will I?

#74 Tony on 04.01.16 at 10:00 pm

The U.S. dollar died shortly after the jobs report. If the report was true the dollar would have either flat lined or risen during the day. The same can be said of the PMI report. No one on Earth believes either one.

#75 Ben Larson on 04.01.16 at 10:10 pm

No mention of Preferreds today Garth?

#76 Tony on 04.01.16 at 10:14 pm

Re: #57 Ole Doberman on 04.01.16 at 9:12 pm

I read the book exactly 20 years ago back in 1996.
What Color is Your Parachute? That was the book that predicted DOW 30,000.

#77 tundra pete on 04.01.16 at 10:16 pm

#25 common sense

Isn’t it that thing between dirt poor and West Vancouver homeowner?

#78 TRUMP on 04.01.16 at 10:23 pm

YES SIR…..

#79 David Bloom on 04.01.16 at 10:31 pm

Liberal sycophants try and spin a ‘sunny future’ lie while the truth is more layoffs and a bleak picture for the economy as savings dry up and real jobs aren’t replaced.

http://www.bnn.ca/News/2016/4/1/Oil-crash-contagion-fears-may-be-overblown.aspx

As we know , Trudeau is well known globally as ‘a man with little intellectual heft’. He is a product dredged up from the back rooms of Liberal hate and sold to Canadians on a platter of ‘winner take all ‘ lies and deception. With the help of a nine year Hate Harper campaign byu the public broadcaster Canadians were finally put to sleep, but the fact that Trudeau Liberals have broken every election promise must have clued even the sleepers to the reality of the scam.

Liberal scammers also want to have you believe that the economy in the US is healthy when the truth is that we’re looking at the shoe dropping from years of gluttonous ZIRP and exporting inflation to the third world.

http://www.cnbc.com/2016/04/01/wall-streets-latest-dirty-word-stagflation.html

Well gang, stagflation is real and will gut both Canada nad the US as the chickens come home to roost. The third world has been squeezed dry, they are as bloated with US dollar debt as we are borrowed to the hilt and see our national debt skyrocketing under the sycophant spenders.

Under this scenario commodity, like gold, will stage a huge rally as markets attempt to find value. House prices will crash along with the first IMF warnings on Canada’s unsustainable debt and spending, along with the complete exhaustion of savings. Ghoulish good for Canada’s stock pickers.

#80 David Bloom on 04.01.16 at 10:39 pm

Forgot to add the facts on the phony ‘jobs surge’.

http://www.marketwatch.com/story/part-timers-might-account-for-labor-force-surge-2016-04-01

It’s all an election ploy and Obama scam for his ‘legacy’ as first black president. It’s all BS coming out of the WH.

For the sake of transparency, this person posts several times daily under different names with the same rabid, disrespectful, extreme-right rhetoric. The posts are almost always deleted. — Garth

#81 Brazil ex-pat on 04.01.16 at 10:45 pm

#8 crowdedelevatorfartz on 04.01.16 at 6:30 pm
Oh God why did you have to mention Brazil in a positive light?
Brazil Ex Pat is insufferable enough as it is……..
++++++++++++++++++++++++++++++++++++

Have you even been to Brazil? Or does the fart gas in your brain only allow you to use the University of Google? Has anyone here that is commenting been to Brazil? I guess no one here has ever been to the USA, Europe, Africa or Mexico where murder happens all the time….and where all the above govts/continents are corrupt.

And Jesus said – “He who hath committed no sin may cast the first stone”.

#82 BillyBob on 04.01.16 at 11:08 pm

wooba,

I am an expat of over a decade, and I returned to Canada. I did not pay income tax whatsoever in Canada and had no issues.

First of all I would say you absolutely should retain professional, RELEVANT advice. I have never seen so much nonsense as what some people have posted here. Not just partially, but 100%, completely false information. Perhaps it is intentional, or perhaps people really think they’re correct. But here’s from mine (and many other Canadian expat colleagues) experience.

There are no absolute rules with the CRA. But essentially, you are expected to cut ties with Canada if you don’t want to pay Canadian income tax. If you don’t do that sufficiently, you can be deemed a resident for tax purposes. But that doesn’t mean you can’t have ANY ties, that’s ridiculous. They basically look at the whole picture and make an assessment.

That assessment assigns different weights to different ties, that they list as primary and secondary ties. Primary ties include things like having your spouse and kids reside in Canada while you live abroad. Another one is owning property that ISN’T AT ARMED LENGTH. i.e. your brother/mother lives in it, or you leave it empty for your use. If you rent if out, to strangers that’s allowed. But you’ll have to pay 25% tax on the rent, every month. Since it’s income earned in Canada.

They also consider what they call secondary ties. Things such as bank accounts, credit cards, and pretty much anything with your Canadian address on it. These things by their own are highly unlikely to have you deemed a resident. They only come into play if you’re already borderline and then tip the scales.

In other words, you absolutely may have say, a bank account. For example, you may own a property and rent it out. (To strangers, managed at arms length, withholding the tax). So of course you have a bank account, it’s only reasonable as a place to deposit rent and cut the cheques to CRA.

Or maybe you keep one credit card, as I did, since some overseas online stores won’t accept credit cards issued in the Middle East, where I lived. Not a problem.

It’s a matter of degree – a couple of reasonable, minor ties won’t even merit notice. NOBODY cuts every single tie to the country you’re a citizen of. But a home that you sister lives in and four bank accounts, a couple credit cards, your wife living in Canada, nope.

Oh and the statement that you need to be away more than two years is false. You need to be away for more than one year to be exempt from tax on importing your household effects, but that’s something different.

Get professional advice. I can hardly believe some of the stuff being written in response to your questions.

#83 Rube Goldberg on 04.01.16 at 11:12 pm

#79 David Bloom
Says who, You? I think Mr. Trudeau is a very nice man. Pretty disrespectful. You must be proud of yourself?

#84 Victoria Real Estate Update on 04.01.16 at 11:20 pm

# 28 prairie person

You appear to be another angry Victoria poster who needs lessons in reading comprehension. Try reading my post again.

You also like to make claims without anything to back them. Saying that you see sold signs in your area proves nothing.

I think you have problems understanding some general things about any housing market.

For example, that current supply/demand conditions are always only temporary. We’ve seen these conditions change quickly in Victoria in the past. A seller’s market can turn into a buyer’s market within a short period of time.

Also, the price performance of a housing market in one month can’t be used to predict the performance of the next month. As we saw in 2010, the market peaked and prices began to follow a downward path that ended up being a significant price decline. The core areas were part of this correction.

The information that I present on Garth’s blog is factual (I’m not dissing Victoria real estate). I’m simply using facts to show potential buyers (there may be some who read my posts) what can happen and has happened with real estate in Victoria in the past and with housing markets in general.

If you prefer to hear the pumpers pump Victoria real estate by making false claims (for example: wealthy buyers from China “suddenly discovered Victoria”) it’s available from many sources: the local paper, local tv channels, other blogs, realtor sites, the local board’s site, etc.

Your comment reveals that you concentrate only on the current supply/demand, sales/listings of the housing market and think that these (temporary) conditions are permanent.

You object to my wider perspective and the way I bring in past market events that are typical of any housing market. Events that history has shown to happen over and over again.

Just like in 2010, there is a lot of hype right now about Victoria real estate. You seem to be on board with it. That hype vanished when prices inevitably began to decline in 2010.

You seem to have missed one of the main points of my post: that house prices in Victoria are only 6% higher than in 2008, despite all of the hype that is out there right now.

Prices in Victoria are only 6% higher after 7 years of emergency level interest rates . Victoria should have seen strong price gains over that time like Canada’s other major cities. That supply/demand conditions have changed over the last year (approx.) doesn’t mean that those conditions won’t change again. They will.

I think you need to broaden your perspective and stop being so angry. I’m not here to repeat the (false) hype of real estate “professionals”. As I said, you can find that almost anywhere these days.

Don’t be disappointed and angry when the market turns around again. It’s inevitable.

#85 Freedom First on 04.01.16 at 11:22 pm

#31 Flop

…..not my main goal in life anymore…..

…………………………………………………

Blasphemy!
I am stunned Flop. Welcome to Freedom! Perspective. You have arrived!

#86 ozy -oxy moron on 04.01.16 at 11:26 pm

I have to be a moron to invest in kinada stock market when locals liquidate in drones and buy multiple houses in kanata and they keep coming…. all their upper-class will move here – evict the ones that are selling… they’ll never be able to buy their former house back

That being said, it looks Real Estate can still be speculated 40% more in Toronto good hoods before flattering then dropping 10%. Also maybe 2000% in maritimes.

Do you have the titanium dingles, Garth? hahahaah

#87 Longterm on 04.01.16 at 11:29 pm

#7 Wooba on 04.01.16 at 6:29 pm

I lived abroad for 10 years in the UK and the rules for Oz are the same.

If you are going to Australia then there is a tax treaty with Canada so you can pretty much keep everything – bank account, credit card, RRSP, TFSA – but you can’t contribute to the latter two while you are abroad and a resident of that other country. When you are in a country with a tax treaty with Canada if you are deemed by that country to be a resident for tax purposes then you are automatically a non-resident of Canada for tax purposes. It’s covered in section 216 of the Income Tax Act – where this is explicitly spelled out. If you earn income in Canada while abroad, besides what is earned in an RRSP or TFSA [no tax is payavble on these earnings], for example rental income, then you file an annual return in Canada to the International Tax Office at Walkley Road in Ottawa, which is called a 216 Return [as per the section of the tax act]. You will need to get a non-resident tax number from CRA to do this. If you don’t earn any income in Canada while you are away then you don’t need to do anything or file any return as long as that other country has a tax treaty as per section 216. In the year you move [and return, if you do] you will still need to file a T1 General. In most cases there is no double taxation and it’s all pretty easy. If you move to a country without a tax treaty with Canada then it’s a different story entirely.

#88 Sydneysider on 04.01.16 at 11:55 pm

#7 Wooba

Yes, you can keep your money in a Canadian bank while you are genuinely resident in Australia, and legally pay no tax in Canada on what you earn (unless Trudeau changes this). However, you are expected to declare any Canadian earnings to the Australian tax authorities, who will treat it in the same manner as money earned in Australia. Apparently the Canadian govt prefers the Aussies to have the tax, but don’t ask me why (the Aussies on the other hand take 10% of earnings from people who park money there).

My Canadian bank was happy to take instructions about term deposits by email for years, but I suspect they would want something in writing had I tried to do anything more complicated.

I can’t comment on Canadian credit cards.

#89 waiting on the westcoast on 04.02.16 at 12:22 am

#74 Tony on 04.01.16 at 10:00 pm says… “The U.S. dollar died shortly after the jobs report. If the report was true the dollar would have either flat lined or risen during the day. The same can be said of the PMI report. No one on Earth believes either one.”

The US$ is flatlining/falling because of Yellen being so dovish… reports can sometimes lift/shrink the currency but that is still due to speculators short-term. The long-term outlook is for the US to rise with interest rates (assuming they come to their senses and raise rates).

#90 Where is the CAD heading? on 04.02.16 at 12:22 am

Garth, do you think our loonie is bound to rise or to drop versus the us dollar the rest of this year? I’m thinking we should see at least 1 us fed interest rate increase, and oil should drop again. That should devalue our Loonie back again to 1.40-ish. Or do you think the liberal debr spending, foolish as it may be, will serve as a cushion to protect our loonie? Any thought much appreciated, keep up the great work!!

#91 For those about to flop... on 04.02.16 at 12:33 am

34 jwk.

That said it may not be relevant as Australia and Canada have a tax treaty – so you won’t be double taxed on income. With the treaty you are considered a non-resident for tax purposes anyway. You still have to file, but you get credit for taxes paid in australia – about the same as Canada .

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

Ok ,this is a question I have been wondering about ,but my mum always said ,don’t ask a question you don’t wanna know the answer to.

I have a superannuation fund that I pay into in Australia.
I started paying in 1992 and it will finish in 2029.

When this fund expires, if I am still living in Canada,which country will I be owing taxes to that year?

Please only respond if you know what you are talking about….that means Mark,its time to go play with your rubber band collection…

M41BC

#92 Go Canada Go on 04.02.16 at 12:46 am

This is why you should invest in China:
https://www.youtube.com/watch?v=RDrfE9I8_hs

Not because Garth told you so or because they have
“middle” class :)

#93 Tire of Waiting on 04.02.16 at 1:04 am

#15 Victoria Real Estate Update

I’ve been waiting on the sidelines for a year or so looking cautiously at condos in Victoria, carefully considering which neighbourhood would be best… essentially, not getting emotional about the whole thing– keeping it rational.

But it’s noticeable just in the past month the change in attitude. Condos would sit on the market for 8 or 10 months last year. Realtors seem now to list average looking condos at higher prices with dates they will be accepting offers. It’s as if they are trying to create a Vancouver-like panic here. I recently contacted a realtor about a suite in a building that had posted on the listing “accepting offers March 21.” Low and behold, I was told the unit had an offer fall through due to financing and I had better get over to see the unit ASAP. These high pressure tactics make me want to barf.

Is it a realtor-generated hype? Or is it for real? Are the hoards really leaving Vancouver to buy up Victoria? I’m so sick of it all.

#94 Capt. Obvious on 04.02.16 at 1:10 am

I agree with most of what this post is about, but I disagree that you should be adding more risky assets to make up for low ‘safe’ investment returns. The correct answer is to save more, not take more risk. If you look at sequences of returns (I’m sure Garth knows this), you can have really horrible outcomes if risk in your portfolio is too high. Remember that taking on risk does not guarantee you the expected return. i.e. the long run can be a lot longer than you think.

#95 family beagle on 04.02.16 at 2:03 am

“weighting to all emerging markets should increase, because that’s where the greatest future expansion lies (…) swelling populations and big appetites for stuff”

Earth: the gravel pit. Shame we can’t interest them in philosophical pursuits. North Americans are convinced if it doesn’t burn, lever, or become easily digested, it’s worthless. Remember the good ol days when we could shoot buffalo from a train? Whatever happened to that? Your pic is an allegory on consumption: Wake up one day and the things we took for granted are gone. Is there an ETF for conservation… thrift?

#96 Robert on 04.02.16 at 2:04 am

In the end, it’s clear that Vancouver, Toronto, and connected real estate markets have outperformed all other investment strategies in Canada for the past decade. There is every sign this will continue for the foreseeable future as there will be no interest rate hikes, mortgage rule tightening, CMHC curbs, foreign ownership regulations, or any other form of regulatatory action to rationalize the rush. The goose is laying golden eggs. Sure, bubbles collapse but why not join in the party. This is a very balanced market when factoring in foreign capital, lax lending and low interest rates, CMHC pumping, government inaction. All this kvetching is pointless.

Oh, you mean recent performance dictates future results? That certain assets can appreciate indefinitely? And it’s different this time? If so, this marks a new phase in human history. — Garth

#97 Bla bla bla on 04.02.16 at 2:33 am

http://www.usdebtclock.org

So tell me when exactly the FED stopped printing monopoly money?

They have to print almost 2 trillion a year just to keep the Ponzi going.

This will end badly. There is no way out.

#98 jane 24 on 04.02.16 at 4:06 am

Hi Wooba

I left Canada in 1992 so have saved myself 24 winters. Yeah!

I left my bank account open to pay Cdn bills and my RSSPs invested. They send my bank statements here to me in England and the RSSPs were frozen but remain alive but I cannot contribute any more. Sadly RRSPs hold back 25% non-residents tax when I cash some in but then I no longer put in a Cdn tax return and that 25% tax is actually cheap.

No one bothered me about the Cdn credit cards so I ran them for a few years and then when I had sufficient credit in England, I got UK cards and cancelled the Canadian ones.

Overall it was very easy and no-one seems fussed about anything. Apparently much worse if you are an American citizen.

#99 Tony on 04.02.16 at 5:31 am

excellent article, things have changed, my question is,
is it permanent, a blip in a large economic cycle, or even the death of capitalism for most western societies,
the economic depression, and political unrest seem to be the new normal, I have no idea where all this is going, or what anyone can do, but it might be bigger than a portfolio rebalance.

#100 family beagle on 04.02.16 at 6:18 am

Mr. Turner, If my earlier comment appears crass, I do apologize and thank you for taking the time to organize the complex concisely, and I agree.. with your positive vibes for North American innovation. I believe we have opportunities to maximize efficiency, develop processes, and export technology and knowledge to emerging economies. We can encourage a shift away from the consumption paradigm and re-emphasize lifestyle over excess. We’re hip enough to affect what the world values and what gets peer approval…balance, diversity, sustainability, harmony. Thanks for your considerable effort.

#101 LowRent of Arabia on 04.02.16 at 6:45 am

It’s been awhile Garth but I have noticed a shift in your readers (or at least those who comment)…I think the Bears are capitulating. Which as you know is the beginning of the end of the Bull market.

Only when the Bears capitulate and buy does it mean this gasbag is done.

I haven’t gone to get a pre-approved yet myself but thats because I am in the desert somewhere near one of twenty Middle Eastern conflicts. Choose one.

The only land I own is a rice paddy near my MIL’s house in SE Asia. Actually I don’t think my name is on the title but I am not sure cause I can’t read Thai. Lol.

There is cheap real estate available in places in the world but Canada is not one of them.

#102 Pepito on 04.02.16 at 7:07 am

# 7 Wooba
# 18 Herb
# 46 Nothing Surprises

The lack of intelligence on this website even on the most simple issues continues to amaze me. How can one expect to jump thru the legal hoops of Australian immigration, yet be totally ignorant of how to become a non-resident of Canada? Hello? Go to the CRA website here http://www.cra-arc.gc.ca/tx/nnrsdnts/cmmn/rsdncy-eng.html
and submit an NR74 form

Also, Why do other posters pretend they know the answers, when they clearly don’t? Yes, you can keep your bank account and investment account, as long as you change them to non-resident accounts. And, yes, you can also keep a provincial driver’s licence..though you’ll have a hard time renewing it with no address in Canada.

How do I know this? I became a non resident a few years ago.

If you don’t know, don’t post BS.

#103 Pepito on 04.02.16 at 7:48 am

Glad to see that you’re finally capitulating to the reality that many posters have been pointing out for some time, mainly that it’s a changed world. In this new reality, taking on more risk is an error (especially for those depending on a reliable annual investment income) most will regret. There is a reason for low yields on bonds: low growth. And that same reason will continue to impact equities. Better bite the bullet, pay a little premium on high quality government bonds and adjust one’s lifestyle accordingly rather than go with the herd and be corralled into more risk.

Your 6 or 7 percent much touted long-term average on the balanced diversified portfolio means nothing to a 65 year old who sees zero or negative growth in his assets for one or two years and must, therefore, dip into the principal for living expenses.

If the 65-year-old you refer to is yourself, stop being fearful and foolish. You have fallen into the classic trap of misinterpreting risk. You already sound angry and bitter – with 25 years to go! Good luck with that. — Garth

#104 New Cad Expat on 04.02.16 at 8:17 am

There is an escape, just leave Canada or places with lower costs of living and lower taxes and don’t look back. I just left on Mar 29 and I’m gone baby, gone.
Bye bye canada, suck it! No more complaining or voting for change from liars, just vote with your feet and leave. Take control of your own destiny. :)

#105 Herb on 04.02.16 at 8:36 am

#102 Pepito,

I’d agree with you wholeheartedly if that link didn’t have the conditional “may” all over it.

#106 hope & ruin on 04.02.16 at 8:46 am

@ Tony and the doomers

why come to a blog like this if you think the end is near? plenty of prepper sites you should be visiting instead.

http://topprepperwebsites.com/

@ Brazil ex-pat

I used to live next door to a bunch of brazilian foreign exchange students that I became friends with, great ppl and culture. I visited S. America but not Brazil, I don’t understand why people hate on the ex-pats here so much.

Different cultures, different climates suit different people. Financially is it better or worse? I’m not sure but I know plenty of people who can’t get ahead here anyways. Keep posting your perspective I think it is valuable and some of us consider that lifestyle.

#107 whiskerstangofoxtrot on 04.02.16 at 9:00 am

#4 Brazil ex-pat on 04.01.16 at 6:26 pm
That is why I am here. And you will learn of what the company I am engaged with is doing here and why we chose Brazil to launch. Amid all the political turmoil it will still be an exciting time to be involved in tech.

Brazil is a dead end dude, not to mention very dangerous….funny how you keep coming on here to try and convince yourself that it was a good move

#108 glasshousebuilder on 04.02.16 at 9:05 am

#102 Pepito on 04.02.16 at 7:07 am
# 7 Wooba
# 18 Herb
# 46 Nothing Surprises

The lack of intelligence on this website even on the most simple issues continues to amaze me…… and submit an NR74 form

Also, Why do other posters pretend they know the answers, when they clearly don’t?

If you don’t know, don’t post BS.”

Good lord….were you looking in the mirror when you wrote this…the NR74 is not a legal requirement to become a non-resident….it is a case by case evaluation, and you may be a de facto non-res even without submitting this form.

If you don’t know, don’t post BS…sorry couldn’t resist.

#109 X on 04.02.16 at 9:08 am

Gotta be honest, for those looking to buy RE, even within Garth’s rule of 90, not alot of value for the $ in the GTA.

Seems like such a high cost for what your getting, even if you can comfortably afford it, financially better to rent in most cases….

#110 saskatoon on 04.02.16 at 9:34 am

trump has the establishment running scared.

chart your IQ with this simple test:

http://www.thestar.com/news/world/2016/04/02/donald-trump-american-fascist.html

if you see through this article…you are reasonably smart.

if you agree with this article…you are as dumb as they come.

#111 Andrewt on 04.02.16 at 9:39 am

The terminology used by the realtors in this article would have been unthinkable not to long ago.
A conspicuous lack of upside spin.

http://www.financialpost.com/m/wp/news/blog.html?b=business.financialpost.com/personal-finance/mortgages-real-estate/no-bottom-in-sight-for-calgary-housing-market-as-prices-drop-3-51-from-a-year-earlier&pubdate=2016-04-02

#112 Jack Haytal on 04.02.16 at 9:43 am

So, Garth, what about you saying for years now that interest rates will rise over the next few years.

Are you back tracking on that now. In some months in 2013, 2014 the longest term GIC, government bond rates, net yields in Canada U.S. were in the 3.0% to 4.25% range.

Now they 2.5% to 3.5% at best. This is a 20% to 30% increase in GIC, bond rates, net yields. They have to rise 50 to 75 basis points just to match were they were. I think it is most likely the Bank of Canada and U.S. Federal Reserve will have to cut rates again in coming months to years.

#113 ROCK BEATS PAPER on 04.02.16 at 9:56 am

“These areas are populated with legions of young people, have rapidly-growing economies (Canada 1%, China 7%),…”

______________________________________________

Garth, that must have been a major typo. Your point is well taken in general, but we would need to sub in India for China.

China is definitely nowhere near 7% growth. That is why South Korea’s exports have fallen off a cliff. Moreover, their population peaked and will now experience decline. Dito Russia. Brazil is in a two year recession, and is the only one with a truly young population with lots of resources and access to the US markets. Maybe Africa will join in sometime this century!?

Chinese growth slated to achieve 6.7% this year. One-child policy modified. As stated. — Garth

#114 Grey Dog on 04.02.16 at 10:00 am

29, how to claim you dog as a taxable expense…my neighbour used to claim his dogs under ‘home security’, mind you they were Rhodesian Ridgebacks, beautiful gentle dogs, they just looked fierce.
Now take my 16 pound miniature schnauzer, fierce, won’t let anyone in that she doesn’t know, once guest is sitting, won’t let them move to another room cause they might steel the silver, or one of her toys…actually she is a case for Caesar Milan so maybe I should claim all her expenses under HOME SECURITY.

#115 Wack on 04.02.16 at 10:05 am

Garth
The insanity of the Yvr has spread out to the outlying cow town of the FV and even beyond! Houses are selling for 100k over what they were a year ago, which was already high enough! I’ve been in the construction business 30 years seen the 7yr boom bust cycle repeatedly, never thought I’d see one as crazy as this one. It is actually madness and people are borrowing vast sums that actually needs to be paid back one day. Not sure of how big this balloon will get, but the bigger it gets the bigger the pop! My wife will be happy for a few days (or months) off with her!

#116 Wooba on 04.02.16 at 10:15 am

#82 BillyBob on 04.01.16 at 11:08 pm

#87 Longterm on 04.01.16 at 11:29 pm

#88 Sydneysider on 04.01.16 at 11:55 pm

#98 jane 24 on 04.02.16 at 4:06 am

Thanks you very much to these folks (and the earlier ones) for your contributions.
I will be seeking professional advice closer to the time I leave, but these are great starting points.

#102 Pepito on 04.02.16 at 7:07 am

I’m sorry if my level of intelligence offends you. Yes I handled the immigration process myself but I didn’t suddenly become dumb. I’ve done a fair bit of research and I’m finding conflicting details at every turn which is why I turned here to ask for others with first hand experience. Doesn’t seem unreasonable to me. I’m not afraid to put my hand up and say I need to some guidance.
I think the last sentence from Garth to you in comment #103 sums it up nicely.

BTW, Ontario licenses are required to be surrendered in some (all?) Australia states when getting a local one. This is listed on the Victoria govt. website, but I know I’ve read the same for NSW somewhere.

#117 Retired Boomer WI on 04.02.16 at 10:20 am

103# Pepito

At 65 years old…if you think your money will last you until you hit room temperature without growing MORE than inflation, you will be seriously disappointed.

YES, there will be years when growth is meager (zero, or even less than her), and years where growth may well exceed 15%. That’s why you have a diversified portfolio, growth & safety.

I cannot tell you why rates yet remain desperately low. You say ‘low growth’ but, we had that crap before, remember stagflation? Low productivity growth high interest.

Whether that ever comes around I can not tell. What I CAN tell is a lot of the things I buy are slowing escalating in price.

My investments need to meet, or exceed those increases.
I am not going back to work, and eating my capital to make-up for low earnings is a loser’s game…eventually you run out of capital. A bitch if you’re still alive, not so much when the kids inherit it. (They can fend for themselves).

By the way a house has no part in my plan. I live in the house, that is all. It’s an asset, if I need it to be.

#118 crowdedelevatorfartz on 04.02.16 at 10:27 am

@#81 Brazil Ex Patsy
“And Jesus said – “He who hath committed no sin may cast the first stone”.
*******************************************

Now you’re quoting the bible?
I would assume Jesus never visited Brazil either but you seem to be ok quoting his advice…..

Still no comments on The Presidents pending impeachment? Still no aknowledgement of the double diget unemployment in Brazil? Still no comment on the inflation rate? The Olympic sized construction boondoggle rushing ever forward to incompletion?

Oh right. And the Zika virus is “propaganda”…..
And because I’ve never visited a 3rd world country that could fall back into a military dictatorship (democracy since 1985?Wow THATS a history of stability…) in a heartbeat(or a bank failure?).
Im not allowed to comment on your silly comments about Canada?
Marie Antoinette used to mock the “little people” and they handed her her head…..
I’ll just sit back and continue to watch the almost daily dreadful financial and political news from your beloved adopted country with interest.
You keep calling it propaganda and ignore it. We’ll keep a 1 bedroom basement suite in Ft Mac waiting you and the family when the financial, political, judicial Sh*t hits the fan down there.
And you call me delusional.

#119 Fine Wild Roasted Gonads on 04.02.16 at 10:41 am

#91 For those about to flop… on 04.02.16 at 12:33 am

34 jwk.

That said it may not be relevant as Australia and Canada have a tax treaty – so you won’t be double taxed on income. With the treaty you are considered a non-resident for tax purposes anyway. You still have to file, but you get credit for taxes paid in australia – about the same as Canada .

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

Ok ,this is a question I have been wondering about ,but my mum always said ,don’t ask a question you don’t wanna know the answer to.

I have a superannuation fund that I pay into in Australia.
I started paying in 1992 and it will finish in 2029.

When this fund expires, if I am still living in Canada,which country will I be owing taxes to that year?

Please only respond if you know what you are talking about….that means Mark,its time to go play with your rubber band collection…

M41BC

I have absolutely not the slightest clue…. the only question that matters is how much beer will it buy.

#120 capital is the new labor on 04.02.16 at 10:41 am

#103 Pepito on 04.02.16 at 7:48 am

Glad to see that you’re finally capitulating to the reality that many posters have been pointing out for some time, mainly that it’s a changed world. In this new reality, taking on more risk is an error (especially for those depending on a reliable annual investment income) most will regret. There is a reason for low yields on bonds: low growth. And that same reason will continue to impact equities. Better bite the bullet, pay a little premium on high quality government bonds and adjust one’s lifestyle accordingly rather than go with the herd and be corralled into more risk.

Your 6 or 7 percent much touted long-term average on the balanced diversified portfolio means nothing to a 65 year old who sees zero or negative growth in his assets for one or two years and must, therefore, dip into the principal for living expenses.

If the 65-year-old you refer to is yourself, stop being fearful and foolish. You have fallen into the classic trap of misinterpreting risk. You already sound angry and bitter – with 25 years to go! Good luck with that. — Garth

===

Pepito, having saved, put together a few hundred thousands or a million dollar and expect that you can offer this to someone for a guaranteed risk free, high return has become somewhat like offering your labor for sale in any profession… Nobody will guarantee you that you that your offering on the market will match a buyer.

There is abundance of human labor, abundance of capital. In fact, creating money has become much cheaper than creating labor capacity…

The bottom line: no matter whether you try to sell your skills, knowledge or your capital, you have to hassle, use your brain to get the most out of it.

Plus, you still need to take risk – in both.

#121 Renter's Revenge! on 04.02.16 at 10:45 am

#99 Tony on 04.02.16 at 5:31 am
I have no idea where all this is going, or what anyone
can do, but it might be bigger than a portfolio rebalance.

NOTHING is bigger than a portfolio rebalance. If you’ve learned anything from reading this blog, that should be it.

#122 Dynex on 04.02.16 at 10:55 am

#103 Pepito

I feel your pain. Get some friends together buy a house and become flippers. It’s the only game in town.I cashed in my portfolio and I’m making cash cash cash flipping. I’ve never been happier in my life. It’s like money falling from trees. Don’t listen to any one else. Just do it! You’re still young.

#123 Joe2.0 on 04.02.16 at 11:09 am

My technical research says today marks the day the Dow turns around after this rally, DOW n
Phase -1

#124 Angela on 04.02.16 at 11:33 am

#7 Wooba

I have been non-resident for 4 years and live full-time in Puerto Vallarta. I still retain my Canadian bank account and Canadian credit cards. As well my investment portfolio also remains in Canada – I just pay a 15% withholding tax at source. I agree with #82 – please get professional advice. Everybody’s situation is different and CRA judges each case individually.

#125 Robert on 04.02.16 at 11:40 am

#96 Of course bubbles are never indefinite but while this irrational exuberance exists isn’t it better to skim off the froth while we can rather than cower in the sidelines. This is a short term play and will run it’s course but it’s clear that government inaction is guaranteed. CMHC will continue to pump, foreign capital will continue to flow in un-checked, low interest rates will prevail for the time being. The trick will be to time your exit. Barring a black swan event (Korea, ISIS, Ukraine, China banks) the next couple of years will see this gas bag continue to inflate. As you know, Harper and Flaherty created this Frankenstein and it’s now too big to let fail. Might as well join the party.

#126 For those about to flop... on 04.02.16 at 11:43 am

#85 Freedom First on 04.01.16 at 11:22 pm
#31 Flop

…..not my main goal in life anymore…..

…………………………………………………

Blasphemy!
I am stunned Flop. Welcome to Freedom! Perspective. You have arrived!

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

Hey Freedom,there is something different about you since you ended your hiatus.
You seem a bit more soft and cuddly….have you found love?
Are you moving into that new condo with a partner?

Either that or your just being nice to me because I said the other day that I would try to hook you up with Pammy Anderson.

I won’t know if you have really softened until Garth writes his next post about a female being stupid and selfish with money, then I will be able to see if you can’t resist hoeing the boots in.

Until then try to treat them as your equal.Always…

M41BC

#127 Joe2.0 on 04.02.16 at 12:04 pm

Ola 124
We live in Bucerias aka BCrias half the year.
Checkout the Skybar in the Marival sometime.
3 drinks and 3 appies for 300 peso’s.
It’s awesome, cold drinks’n hot sunsets.
Viva la Mexico!

#128 David Bloom on 04.02.16 at 12:17 pm

“Forgot to add the facts on the phony ‘jobs surge’.

http://www.marketwatch.com/story/part-timers-might-account-for-labor-force-surge-2016-04-01

It’s all an election ploy and Obama scam for his ‘legacy’ as first black president. It’s all BS coming out of the WH.

For the sake of transparency, this person posts several times daily under different names with the same rabid, disrespectful, extreme-right rhetoric. The posts are almost always deleted. — Garth”

Please elucidate us on a single falsehood offered . Take my posts and tear them apart if you can. I posted articles written by some of the world’s most responsible journalists.

Is the truth as others see it ‘extreme right’ because it disputes your rhetoric?

#129 Damifino on 04.02.16 at 12:20 pm

#83 Rube Goldberg

“I think Mr. Trudeau is a very nice man.”

I couldn’t agree more, Rube. He’d probably make a fabulous next door neighbor.

He’s just a rather poor choice for leader is all. But then again, there wasn’t much choice on offer last October.

#130 busman7 on 04.02.16 at 12:57 pm

@#7 wooba “I will be seeking professional advice closer to the time I leave” is the best advice you’ll receive, just make sure it is an accountant who specializes in tax preparation for expats.

Forget the CRA website if you want to save money!

Remember, depending on your age and how long you’re out of Canada before retirement age you may be forfeiting your OAS benefits.

Also beware of those advising giving up Canadian citizenship as a Canadian passport is one of the better ones to travel on.

Why Australia? It’s main difference from Canada is that the water going down the drain circulates in the opposite direction.

Advise from an expat currently being persecuted by the Harper regime trained civil servants at Service Canada.

#131 Pepito on 04.02.16 at 1:00 pm

If the 65-year-old you refer to is yourself, stop being fearful and foolish. You have fallen into the classic trap of misinterpreting risk. You already sound angry and bitter – with 25 years to go! Good luck with that. — Garth
_________________________________________

No, I am not that 65 year old, nor am I bitter or angry.

If anyone is misinterpreting risk, I dare say, it is you. The world is in a mess, and equities have been bid up by quantitative easing and, to a great extent, share buybacks. Productivity is dead in the water and demand is also on life support as consumers all over the world are stretched to the limit and drowning in debt. And, contrary to your previous assurances, China is most certainly not fixed. This is what a low growth world looks like and, in my humble opinion, it is certainly not the time to be advising others to reach out for more risk, especially retired folks who are the least able to recover from any serious downturn in world markets which may take years to recover.

#132 Jetfixer on 04.02.16 at 1:19 pm

I went to Brazil in October for work and I can honestly say I had a great time, maybe one of the best weeks of my life. It was beautiful, but you definitely have to be street smart there. There are areas that are strictly no-go at night or in the day.

Generally speaking, the people there are smart, super friendly and I’m not gonna lie, the women were knockouts. Even with a language barrier they were more friendly than trying to talk to someone in Toronto. Having said that, yes it is a country that is in a tough spot right now with GDP declining at 3-4%, and yes the president is under investigation for corruption with Petrobras, but at the same time, it is not Mogadishu! University education is free there too so there are a lot of educated young people that are engaged politically. I think that is why you are seeing a lot of grassroots type of stuff. Overall, I think there is still a lot of potential for that country.

Besides, an emerging market ETF like VEE for example, is only 6.7% Brazil anyways. There are some really good companies too. Take Embraer for example, they make a really good regional jet, better than anything Bombardier has produced for regional jets IMO.

#133 Pepito on 04.02.16 at 1:49 pm

# 116 Wooba and #108 glasshousebuilder

Typical Canadian. No, you did not offend. Just somewhat amazed that you would be looking for answers on the internet rather than CRA’s own info and a professional tax accountant. Old school, I guess.

glasshousebuilder, where in my post did I say that a NR74 is a legal requirement to become a non resident? On the other hand, if one wants to be absolutely sure that one’s in the clear with CRA, an NR74 is probably the best way to achieve that.

#134 Bram on 04.02.16 at 1:50 pm

It looks like prices in East Van is still rising.
I was watching a house in my neighbourhood that was listed at $2M+ thinking it was overpriced.
https://www.google.ca/maps/@49.2317314,-123.1046232,3a,75y,354.36h,78.7t/data=!3m6!1e1!3m4!1syx7X9kCm9E6dM3bPg7GK5w!2e0!7i13312!8i6656

It is a pretty mediocre house east of Ontario, standard 33ft lot. It is close to the school though.
And last week, it sold!

I don’t think it fetched over ask, if anything, probably a little below as it was on the market for several months.

But if 2M is the new norm for mediocre East Van houses, it could mean that march’16 numbers will again be through the roof.

A lot of it has to be caused by supply, as it was the only house for sale in that area that was not on the busy streets of main,41st,49th.

A 100 yrs from now, history professors will probably study 2016 Vancouver with their students.

Bram

#135 ROCK BEATS PAPER on 04.02.16 at 2:10 pm

#96 Robert on 04.02.16 at 2:04 am

“This is a very balanced market when factoring in foreign capital, lax lending and low interest rates, CMHC pumping, government inaction. All this kvetching is pointless.”
_____________________________________________

Garth, you are way too gentle.

_____________________________________________
“Chinese growth slated to achieve 6.7% this year. One-child policy modified. As stated. — Garth”

Lets be clear, slated means by the Chinese government, which I will admit has a perfect forecasting record! Command & Control.

Speaking of which, that one child “policy” is going to take at least one generation to fix, so not relevant for the wrinklies except for the aging aspect and decline.

#136 Pepito on 04.02.16 at 2:16 pm

#120 capital is the new labor

Catchy handle but, no, capital is NOT the new labor. The new labor is still the old labor, just worse off, and capital is still capital doing what it has always done.

There are still some small pockets of investment with relatively low risk, albeit at some premium. Provincial bonds are a case in point. You can still get 3-3.5% on such bonds if you go out 10-15 years. If one is a non-resident expat, as I am, the interest on such bonds is not taxable in Canada, and the risk is relatively very low. On a mil plus portfolio such an ROI is absolutely adequate to live comfortably in Spain, for example, where wine, food and housing is excellent and inexpensive compared to Canada. So, no, one does not need to take on more risk, at least not yet.

#137 Rube Goldberg on 04.02.16 at 2:41 pm

Sorry Joe I was wrong. I had no idea that this Pacific Rim country was doing this to Canada Wow! I wonder if anybody else is? I better start wakening up.Attached is the decision from the Judge. Again I’m so sorry.

https://www.canlii.org/en/bc/bcpc/doc/2015/2015bcpc302/2015bcpc302.html?searchUrlHash=AAAAAQAIeHVuIHdhbmcAAAAAAQ&resultIndex=1

#138 Freedom First on 04.02.16 at 2:43 pm

#126 Flop

I live alone.

That being said, there is many women being hoodwinked and raked over the coals by men too. Gender is irrelevant.
Also, as a hetero man, I have said that if I was a woman, I would be living the same single lifestyle. Marriage is high risk. Whether higher for men or women is debatable, and to me, irrelevant.

As for soft and cuddly. Well, I lift weights and do cardio, so I am as hard as a rock, but yes, I am cuddly. A lover not a fighter, so to speak. I think the vast majority of my girlfriends remember me fondly, as I do them. I don’t cheat or mislead anyone. How else could I have lifetime relationships with friends and family.

Money is important. And essential. But so is emotional and mental health. I learned decades ago that I must learn to handle my emotions, or they will handle me. Decades of ongoing practice is helpful. Listen to Garth in his interviews. He is a Master.

While it is good to be kind and generous, it is not wise to operate like a fool. Garth spends a lot of his time warning us about foolish financial decisions. However, whether people use the sound financial Principles in their lives, or not, it is their choice. If not, though, the odds of becoming a Greater Fool, are highly elevated. This is proven by the recent Housing collapses worldwide, and in past history, as irrefutable proof.

#139 espressobob on 04.02.16 at 3:03 pm

Emerging market ETFs require a bit of homework. Looking at the geographical weightings in that old claymore BRIC fund (CBQ) it wreaks of concentration risk.

http://www.blackrock.com/ca/individual/en/products/239470/ishares-bric-index-fund

The Vangaurd ETF (VEE) has more diversification. Judge for yourself.

https://www.vanguardcanada.ca/individual/mvc/detail/etf/overview?portId=9556&assetCode=EQUITY##portfoliodata

#140 capital is the new labor on 04.02.16 at 4:09 pm

#136 Pepito on 04.02.16 at 2:16 pm

Thank you Pepito, I like your handle, too… It reminds me of the book, Platero and I, by Juan Ramon Jimenez, my mom used to read me when I was pepito.

I am very excited to visit Barcelona this summer, for the first time, I am planning to absorb all the goodness there, you mentioned.

Your comment on non-taxable ROI on provincial bonds if you are non-resident ex-pat is a jam.

Wouldn’t the taxman in Spain want some of that cake, though?

#141 Damifino on 04.02.16 at 4:32 pm

#136 Pepito

“This is what a low growth world looks like and, in my humble opinion, it is certainly not the time to be advising others to reach out for more risk, especially retired folks who are the least able to recover from any serious downturn in world markets which may take years to recover.”
———————————————

I am now 65. I retired in 2007 at 56. I sold my last property in 2010 in Vancouver. I now own no RE at all.

I’ve been living on the proceeds of my investments here in silly YVR for 6 years. I rent a nice place downtown for about half of the cost of ownership. (I don’t know why the owners of this building choose to subsidized me, but my hat goes off to them).

The low growth world has been in effect for quite a while already. It certainly has been since I’ve been an investor dependent upon my own capital.

My money is invested with fee-based advisors who have no product to sell other than their own financial management skills. I pay them to manage my risk. So far, they have done a stellar job and been worth every penny.

My capital has fluctuated over time. Today there is more than I started with. There has been also less. I stopped worrying about capital fluctuations long ago. It’s more important not to run out of income than it is to worry about changes in paper value. A properly managed portfolio will fluctuate far less than the markets.

I hope to live perhaps another twenty years. I have no choice but to take some risk. But, I don’t have to take excessive risk. That’s why I got out of real estate, or at least, got out of the insane lack of diversification that goes along with it.

(For for most people, that is. If you’ve already got 4 million in liquid financial assets then I suppose you can justify another 2 million tied up in a West Side SFH).

You’ve got it backwards my friend. Garth is not encouraging anyone to take more risk. He is all about acknowledging risk and helping people manage it sensibly. That’s the dynamic of the world now upon us at that’s the last dynamic guys our age will see.

We’re going to need more people like Garth but, as of the moment, they are few and far between.

#142 World iterations on 04.02.16 at 4:33 pm

There is an amazing collection of statistically skewed maps from BoA.

http://www.bofaml.com/content/dam/boamlimages/documents/articles/ID16-305/bofaml_transforming_world_atlas_2nd_edition.pdf

#143 Brazil ex-pat on 04.02.16 at 4:37 pm

#118 crowdedelevatorfartz on 04.02.16 at 10:27 am
@#81 Brazil Ex Patsy
“And Jesus said – “He who hath committed no sin may cast the first stone”.
*******************************************

Now you’re quoting the bible?
I would assume Jesus never visited Brazil either but you seem to be ok quoting his advice…..

Still no comments on The Presidents pending impeachment? Still no aknowledgement of the double diget unemployment in Brazil? Still no comment on the inflation rate? The Olympic sized construction boondoggle rushing ever forward to incompletion?

Oh right. And the Zika virus is “propaganda”…..
And because I’ve never visited a 3rd world country that could fall back into a military dictatorship (democracy since 1985?Wow THATS a history of stability…) in a heartbeat(or a bank failure?).
Im not allowed to comment on your silly comments about Canada?
Marie Antoinette used to mock the “little people” and they handed her her head…..
I’ll just sit back and continue to watch the almost daily dreadful financial and political news from your beloved adopted country with interest.
You keep calling it propaganda and ignore it. We’ll keep a 1 bedroom basement suite in Ft Mac waiting you and the family when the financial, political, judicial Sh*t hits the fan down there.
And you call me delusional.

+++++++++++++++++++++++++++++++++++++

I never called you delusional. I simply said you have fart gas in your brain. I stand by that.

What would you like me to say about the President? Yes….she is getting impeached. In places like Brazil people go to jail when they are caught breaking the law unlike many “un-named” G-20 countries where politicians and heads of corporate interests always get a pass.

Double digit un-employment? HAHAHAHAHA….your funny or ENGRACADO as we call it. You think there is not “double digit un-employment in Canada”? You know how many people do not qualify for EI? How many are on Welfare? Neither group is counted in Canada’s “Govt Statistics” as un-employed. If I had to take a good guess Canada’s un-employment is 12 to 15 percent. And that does not even include the PUBLIC SERVICE of which is 30% in Canada (one of the biggest in the world) which sucks the life out of the tax payer.

LOOK in your own back yard please before you start slinging insults about Brazil.

I’m going to the store now to spend $40 Cdn on 6 steaks, lettuce, 5 avocados, two one liter bottles of cachaca and limes. All would be $200 in Canada. Then will BBQ with real wood charcoal. Not gas or oil based “briquettes”. Wood charcoal BBQ is the bomb……the taste of the meat is exquisite. Oh and its 28 degrees here and sunny. Plus fit beautiful people everywhere……how’s the diabetes race going in Canada?

Enjoy your day….

#144 Brazil ex-pat on 04.02.16 at 4:46 pm

DELETED

#145 Brazil ex-pat on 04.02.16 at 5:17 pm

#144 Brazil ex-pat on 04.02.16 at 4:46 pm
DELETED

O Que? Garth é confuso…….

#146 WUL on 04.02.16 at 5:57 pm

RE: WRINKLIES AND WRISK:

My dear, 86 year old mother, is a conspiracy theory fan non-pareil. She has devoured every word published on the JFK assassination and 9/11. Her latest is that Gerry S and Murray E simply planted Nigel Wright in PM Harper’s office to better ensure the F35 debacle would be purchased by the gubmint to boost their respective aerospace ventures.

You cannot get her started on any issue that is blended with intrigue unless you have two hours on your hands.

Her latest, on the low returns of fixed income investments, is that it is simply a conspiracy by The Powers That Be to force the wrinklies into the perils of the dreaded “stock market”.

Fortunately, she is, relatively speaking, “walkin’ in tall cotton” having reported to work daily for the same employer for 30+ years without complaint.

#147 @Brazil ex-pat on 04.02.16 at 5:59 pm

@Brazil ex-pat:
Dude, there are brazilians everywhere and I’m one of them. And I’m watching you… Lol

Acorda, Brazil is not the paradise you mention. More people die in it per year than on Irak or Afghanistan.

One day you will realize the sh*t of a country it is. Just leave the bubble. Try to cancel an account with Tim or Itau or travel trough Linha Vermelha at night.

Wake up. The country is on verge of a collapse. I’ve friends on the Army. They are paying close attention ro the situation. Soon, it might be 1985 all over again.

Go ask your wife about Collor or Sarney or ACM.

The country is a mess, unfortunately the aituation is getting dangerous faster than expected.

Now, compared to YVR, you are right in some points. Who would want to live in that place?

#148 learningfromyou on 04.02.16 at 5:59 pm

Thank Garth immensely for your posts.

I added another task in my months, review the information available at

http://www.turnerinvestments.ca/

#149 Victoria Real Estate Update on 04.02.16 at 6:27 pm

# 93 Tire of waiting

Current market conditions/sentiment will change. It always does no matter what housing market you consider.

Chill. There will be a much better time to buy real estate in Victoria in the future.

If prices were supported by incomes and rents and if rates weren’t at emergency levels I’d be bullish on Victoria real estate. That isn’t the case and I’m not bullish at this time.

If you buy good luck.

#150 prairie person on 04.02.16 at 7:00 pm

To whoever you are who never passes up an opportunity to belittle the Victoria market: you’re full of it. No one campaigns year after year on one issue without a hidden agenda. Yes, Victoria prices haven’t kept up with Vancouver. So what? Victoria prices are higher than in the US, especially if you cherry pick the spots. Try San Diego. You need to get out more. Nope, no reason to be angry. I’ve bought three houses in Victoria, have done well on the first two, will do just fine on the third one. There used to be a demented character downtown who carried signs and wore sandwich boards about the coming end of the world. Was that you before you got a computer and were disappointed that the world didn’t end? Anyway, keep wasting your time. At least it keeps you occupied and, hopefully, out of trouble. For everyone else, here’s an article worth reading.
A total of 1,121 properties of all types sold through the Victoria Real Estate Board’s Multiple Listing Service last month. The previous record of 1,083 sales was set in May 1991. – See more at: http://www.timescolonist.com/news/local/greater-victoria-s-red-hot-real-estate-market-sets-record-in-march-1.2222284#sthash.sXVRLwr4.dpuf

#151 WUL on 04.02.16 at 7:19 pm

Hon. Bronc Twister GT:

Thanks for your patience.

The internet is the best thing since aluminum horse shoes were invented for the hot bloods racing at Woodbine.

When I moved to Ft. Mac 2 and 1/2 years ago, all I brought with me were old clothes and porridge. I could not bring my 88 string guitar with the black and white keys (it would not fit in the overhead compartment on a WestJet flight). Hence, today when I put new strings on the Tennessee Flat Top Box, I was without E above middle C to tune up. (not that being out of tune ever worried me when I was trying to woo the gals with railroad songs).

Sure enough, you can get the sound of E above middle C on the web.

Grand Ole Opry, here I come (I am composing some oil sands tunes). If the Horseshoe Tavern is still around, I will launch my career there.

#152 For those about to flop... on 04.02.16 at 7:30 pm

Well,I talked a little bit about my hood yesterday and said the houses that were asking 1.6 weren’t getting it and yet when i went past this one today it had a sold sticker on it.
It was on the market for a month and hasn’t had much in the way of updates ,but I bet it went for at least 1.5 which is stupid money for a house that old in this hood.

M41BC

http://imgur.com/t3aCHSp

#153 moonwajings on 04.02.16 at 7:38 pm

#133 Pepito on 04.02.16 at 1:49 pm
# 116 Wooba and #108 glasshousebuilder

Typical Canadian. No, you did not offend. Just somewhat amazed that you would be looking for answers on the internet rather than CRA’s own info and a professional tax accountant. Old school, I guess.

glasshousebuilder, where in my post did I say that a NR74 is a legal requirement to become a non resident? On the other hand, if one wants to be absolutely sure that one’s in the clear with CRA, an NR74 is probably the best way to achieve that.”

Pepito, great waffling…are you Belgian by any chance.
And great moonwalking on the issues that you raised….take up tap dancing next..maybe a few Fred Astaire videos would help

#154 For those about to flop... on 04.02.16 at 7:58 pm

Freedom First,yeah you are running your race and are happy as am I.
I like the banter we have but I’m glad that we write each other sincerely occasionally just to show respect.

I see the banter between Crowded and Brazil ex pat and I don’t see the big deal.
One guy is in Canada… happy
One guy is in Brazil….happy

Scoreline in football or hockey terms ….1-1 ,it’s a draw!

You should not sledge someone if you can’t take a little bit back ,which is why neither of us squeal when the other one is serving it up.
I wish you only happiness,but I will still needle you as I see fit.
Good luck,brother.

M41BC

#155 jess on 04.02.16 at 8:05 pm

In 2014, the global rich spent an estimated $2 billion acquiring nationalities.”
http://www.pbs.org/newshour/making-sense/why-one-percenters-spend-billions-on-foreign-passports/

Where is the cheapest place to buy citizenship?
By Kim Gittleson BBC reporter, New York

4 June 2014
http://www.bbc.com/news/business-27674135

#156 crowdedelevatorfartz on 04.02.16 at 8:08 pm

@#132 Jetfixer.
No arguement about the Brazilian gals. Have 3 different friends that married absolute knockouts….and now all 3 are divorced. Skinned alive financially and the gals stayed here….could have run back home to Brazil and lived like queens but choose to stay here in YVR…..
My brother has visited, liked it, but was wary of the crime.. My sister has billeted Brazilian kids several times for school exchanges. They are polite, well educated but want to live some place other than Brazil….?
Brazil looks beautiful but I’m sure its not the utopia that “Brazil formerly named Pat” harps on about.

Time will tell who’s right about their economy , political implosion and which country will devolve into anarchy first……
Methinks Canada will be accepting Brazilian ex pats…..by the hundreds.

#157 For those about to flop... on 04.02.16 at 8:19 pm

WULLY,no Canadian team is going to be in the playoffs but to amuse you I will give you my hockey story.

Upon moving to Vancouver I tried to support the Canucks but it just didn’t feel right ,after all where I come from you choose a team because you like them not just because you live there.Melbourne is roughly the same population as T.O but they have 10 pro football teams.
You pick one because it feels right not because of your address.

Anyway during the first lockout ,I had time to think about who I really wanted to go for and I chose the Philadelphia Flyers,they were struggling down the bottom of the east at the time but had some players I like.

I am not going to declare Claude Giroux my favourite player as every time I do that the guy ends up getting traded…sorry Scott Hartnell and Vinny Lecavlier.

Anyway I’m sure you have more important things to do in Fort Mac on a Saturday night but maybe your good karma can help my team scrape into the playoffs.

Go Flyers.

M41BC

#158 WUL on 04.02.16 at 8:57 pm

FLOPSTER:

Meet me down the hall. This much ballyhooed sorry blog is the wrong place to discuss hockey. Fortunately, Dorothy is moderating right now while whatshisname polishes the V-Twin.

I had season tickets to the Oilers ’83 to ’86. Those guys could dangle. Growing up with Foster Hewitt and Ward Cornell, the only choices were the Habs (the Pocket Rocket vs. Dave Keon) so you had to choose one.

The Flames arrived in Cowboy Heaven in ’81 and Lanny hoisted the cup in ’89. On that date, I was in a tent on the Oregon coast. ’79 to ’83 I was in Vancouver and fell in love with “Stanley Steamer” and Thomas Gradin.

Fact is, the local press in any town causes the local heroes to worm their way into your heart.

Giroux, Schenn, Simmons and the “Ghost” (can you say Calder Cup??) are a reasonable bet.

Garth:

Why do you hate hockey, for crying out loud??!!!

#159 Brazil ex-pat on 04.02.16 at 9:13 pm

#156 crowdedelevatorfartz on 04.02.16 at 8:08 pm
@#132 Jetfixer.
No arguement about the Brazilian gals. Have 3 different friends that married absolute knockouts….and now all 3 are divorced. Skinned alive financially and the gals stayed here….could have run back home to Brazil and lived like queens but choose to stay here in YVR…..
My brother has visited, liked it, but was wary of the crime.. My sister has billeted Brazilian kids several times for school exchanges. They are polite, well educated but want to live some place other than Brazil….?
Brazil looks beautiful but I’m sure its not the utopia that “Brazil formerly named Pat” harps on about.

Time will tell who’s right about their economy , political implosion and which country will devolve into anarchy first……
Methinks Canada will be accepting Brazilian ex pats…..by the hundreds.

++++++++++++++++++++++++++++++++++

So are you a politician or…….? You sure seem to like to twist words and cherry pick the things others say.

I never said Brazil was a utopia. The divorce rate in Canada is not much better than Brazil.

I have been saying the same thing….over and over…..BOTH countries have problems. But the women in Brazil are hotter, the weather is warmer and the food is yummier. Add in FREE healthcare and education and well maybe it is utopianish…….Too bad Canadian kids are paying off student loans until they are 35 and get limited healthcare unless they are in a car crash. But you choose where you want to live I guess.

Cheers !!

#160 acdel on 04.02.16 at 9:25 pm

Hey Garth, great blog!

After reading what you mentioned I will adjust my portfolio somewhat but I have to say that you have more optimism in the U.S. economy then I do. I will personally wait until after the election for a major change.
Although the numbers are looking ok from a data point, (it could be a mistake on my part) but I just do not believe the U.S. and Chinese numbers; we all know that the official employment numbers are half of what they really say, that’s including Canada and I guess Brazil.

What’s with all these Brazilian posts??

#161 Fine wild roastedgonads on 04.02.16 at 9:31 pm

#158 WUL on 04.02.16 at 8:57 pm
FLOPSTER:

Meet me down the hall. This much ballyhooed sorry blog is the wrong place to discuss hockey. Fortunately, Dorothy is moderating right now while whatshisname polishes the V-Twin.

I had season tickets to the Oilers ’83 to ’86. Those guys could dangle. Growing up with Foster Hewitt and Ward Cornell, the only choices were the Habs (the Pocket Rocket vs. Dave Keon) so you had to choose one.

The Flames arrived in Cowboy Heaven in ’81 and Lanny hoisted the cup in ’89. On that date, I was in a tent on the Oregon coast. ’79 to ’83 I was in Vancouver and fell in love with “Stanley Steamer” and Thomas Gradin.

Fact is, the local press in any town causes the local heroes to worm their way into your heart.

Giroux, Schenn, Simmons and the “Ghost” (can you say Calder Cup??) are a reasonable bet.

Garth:

Why do you hate hockey, for crying out loud??!!!
—-
Garth hates hockey? Is this widespread blog dog knowledge I am unaware of?

#162 dontcallmeshirley on 04.02.16 at 9:32 pm

Folks,

Garth neglected to mention the easiest way to totally eliminate risk on your long positions. Simply spend a few bps of your long position and buy long future dated put options.

All this cheap insurance will cost you is a couple hundred bucks. You’d be foolish not to backstop long positions with put options.

You can bet Garth and his hedge buddy do it.

#163 baddog on 04.02.16 at 9:38 pm

Great post today Garth.

#164 acdel on 04.02.16 at 9:40 pm

Ok, the feel good story of the day; a little light to this pathetic excellent blog; way to go Steven Tyler!

http://www.cbc.ca/news/canada/hamilton/news/aerosmith-chance-encounter-niagara-falls-1.3518080

#165 DON on 04.02.16 at 10:56 pm

From the Buddah calendar. April 1st, 2016.

“Fulfilled desire may provide a sense of temporary satisfaction; however, the pleasure we experience upon acquiring a new care or home, for example, is usually short-lived. When we indulge our desires, they tend to increase in intensity and multiply in number. We become more demanding and less content, finding it more difficult to satisfy our needs.”

#166 Star Stuff on 04.02.16 at 10:59 pm

President Rump to be predicts massive recession….

http://www.theglobeandmail.com/news/world/trump-predicts-massive-recession-in-us-slams-nato-allies/article29504750/

#167 hope & ruin on 04.02.16 at 11:00 pm

Brazil comes up 70+ times on this page lol.

Guess we can add this to the list of things not to mention on greaterfool: building 7, foreign money, freedom first, brazil….anything else?

And I have an update from the millennial housing craze front lines. Bidding wars in mississauga, for real-zies. First-time buyer townhouses, 3bd, 2bath went for 80k over asking. Friend made a bid on the next one, offered 20k over asking but it went for 60k over instead.

Friend lost out on both, asked him if he was mad about all the foreign money driving up prices. He said no and he wasn’t sure what I was talking about. So I asked if the people at the open houses “looked Canadian”? he said: “of course not, it’s mississauga”.

#168 crowdedelevatorfartz on 04.02.16 at 11:19 pm

@#159 Brazilian socialist ex pat
“FREE healthcare and education and well maybe it is utopianish…..”
*******************************************
Completely unafforable at current GDP estimates but considering that Lula and Dila represent the socialist leaning “Workers Party”.
Im not surprised.
The other paragon of fiscal responsibilty in South America?
Venezuala. Hugo Chavez’s experiment in absolute financial meltdown. His only saving grace? He died of cancer before the next revolution that with toss the lunatics in power out.
Brazil is staggering towards fiscal, political and judicial meltdown all while the populace prepare for an Olympics that nobody really cares about.
Zika is the least of their worries.
Good luck with that.

#169 crowdedelevatorfartz on 04.02.16 at 11:23 pm

@3167 hope and ruin
“Brazil comes up 70+ times on this page.”
*******************************************

my bad. :(

#170 Dups on 04.02.16 at 11:24 pm

Our CAD dollar could be in shaky grounds again.
Garth is right to not bet against America. The currency though does make the US stock market investments a double edge sword sometimes. Hope its handle stays on and does not fall for a while.

https://news.markets/comment/canadian-dollar-rally-has-run-its-course-13644/

#171 For those about to flop... on 04.02.16 at 11:25 pm

Hey WULLY,I went looking for you down the hallway past the conspiracy theory blog,the climate change blog and the beer blog ,but I got lost so I came back here.

You picked up a point tonight….the Flyers won and I’m giving you an assist.

The weather blog is telling me that people in Vancouver are absolutely giddy about the weather this week.
I drove out Surrey today and could not believe how many open house signs I saw for this time of year.

5 on Knight st in 10 block stretch alone.
2016 is not going to be the year of the cool off in Vancouver ,the way it is looking it is the same as the best Men At Work album….Business As Usual…

M41BC

#172 from the mouth of a wolf on 04.02.16 at 11:38 pm

Not everyone should own a house!

listen 21min

https://www.youtube.com/watch?v=YSU1GUD-NF4

#173 Ronaldo on 04.02.16 at 11:39 pm

”The only challenge was to amass enough money by sex-pill age, then all was cool.”

what age might that be? lol

#174 Dups on 04.02.16 at 11:51 pm

I think Donald Rump is probably shorting himself, he will probably drop out as planned and make out with millions like a bandit. He is there for himself and for money not for his country. Look at his speach podium logo”TRUMP”, not a single sign of USA or any patriotic slogans. He is a self serving egoistic oportunistic individual that will profit no matter how things turn out.

#175 Move on VREU on 04.02.16 at 11:57 pm

Good for you for publishing Victoria’s excellent sales stats and for calling out the hidden agenda of VREU.

I was about to post the same article but you beat me to it.

Unfortunately, that type of factual information does not compute with our little friend that tries to ‘talk down the market’ because she cannot afford it.

Isn’t it interesting how bears are quick to point out that past trends of increases do not predict future price increases. Well, that knife swings both ways – past years of stagnant or declining performance does not mean future years of stagnant of declining performance.

Oh, and I am still waiting for VREU’s explanation of why EXACTLY sales are so hot and prices are heading north. Go ahead VREU, put your explanation on the record so as to be ‘credible.’

#176 Move on VREU on 04.03.16 at 12:00 am

My previous post was in regards to #150 prairie person.

I do think that the hot sales were partly due to the new down payment rules, but the vast majority of sales were attributable to Vancouver boomer refugees cashing out and letting naive millenials and foreign capital fund their retirement.

#177 Gerbils McGill on 04.03.16 at 12:39 am

“Remember, depending on your age and how long you’re out of Canada before retirement age you may be forfeiting your OAS benefits.

Also beware of those advising giving up Canadian citizenship as a Canadian passport is one of the better ones to travel on.

Why Australia? It’s main difference from Canada is that the water going down the drain circulates in the opposite direction.

Advise from an expat currently being persecuted by the Harper regime trained civil servants at Service Canada.”

*****OZ is as bad tax wise as Canada in the tax department…pretty much the same as….with better weather.

The definition from the CRA is ‘residence. You can leave your RRSP and investments behind…paying tax on the non reg…..you can own your home and rent it out…..claiming income from the rental…as we see from the hundreds of thousands of HAM …remote ownership doesn’t deny you the ability to invest.

But why OZ? Choose a country with a much lower tax rate….and the biggest savings is not paying the CPP and EI every month…which in my case saves me $700 a month alone.

If you’re afraid of losing a portion of the $400 a month in CPP and OAS….you’ve done something very wrong in your life. $400 in London is a Big Mac and sortie down to Bon Au Pain on the high street.

My message to young people is not to get entangled with the Canadian system at all…get out of Canada the day after you graduate. Canadians have to be the least mobile of any developed nation…why? Is it because you believe the propaganda and get encumbered with 80 year mortgages? Things aren’t getting better in Canada…the opposite is true….unless you’re a Liberal Unionized civil servant…everyone else should leave.

#178 Maddness on 04.03.16 at 2:55 am

http://pauleviston.com/mylistings.html/details-55417773

Why not buy anywhere else and get luxury

#179 truthy on 04.03.16 at 3:06 am

True incident

I sold the house I’m living in recently and was in the process of finding a new rental unit.

I was interested in a unit which was under the control of a rental agency. I filled out my form and was asked if they can do a credit check.

Well in less than 40 minutes later this agency called us back and ask about our 3 other houses which we had partial ownership in Vancouver, and 2 in the USA and 1 in mainland china.

They also knew we had only one mortgage and the rest were all paid up.

This raises an eyebrow. Here the Real estate board and our government are all indicating its impossible get stats and here this agency found out everything about us in less that 40 minutes.

btw I am Canadian

not japanese because I own an honda and not chinese internationalist because of my last name

#180 1 mill in 7years on 04.03.16 at 3:11 am

http://www.theglobeandmail.com/life/home-and-garden/real-estate/vancouver-homeowners-cashing-out-for-smaller-markets-with-more-space/article29492020/?service=mobile

Lucky and smart. Thus is what feels the buy now, good investment etc

#181 David Bloom on 04.03.16 at 5:46 am

Garth, ‘for the sake of clarity’ , it was the British newspaper ‘The Guardian’ that called Junior “a man with little intellectual heft”, not my line, theirs, it had been oft repeated in the European media. You accusing me of ‘disrespect’ is misdirected.

Saying the Trudeau Liberals ‘have to spend 30 billion dollars “sustain the economy” is another red herring as the Libs I’m the budget speech has directed more than a third to ‘social infrastructure’ , which as you know is a political franchise not economic .

Hate me by all means, most unaccountable Liberals do, but please, let’s at least be adult about the absolute public truth.

#182 Fortune500 on 04.03.16 at 6:52 am

The NR74 just gives you a snapshot in time. The CRA can decide after the fact that circumstances changed between the time their verdict was issued and when you actually returned to Canadian shores. What it does do though is put you on their radar …

#183 Herb on 04.03.16 at 7:56 am

http://www.cbc.ca/news/politics/tax-expenditures-giveaways-neil-macdonald-1.3515484

Could it be that Trudeau II is interested in good government, not just politics? Unthinkable!

#184 Companhia Brasileira de Distribuição De Cachaça on 04.03.16 at 8:03 am

#Brazil ex-pat

According to your experience, Brazil sounds like an exquisite ex-pat escape destination. However, you’d better watch out and never ever leave your cachaça glass unattended. I’ve heard on several occasions frightening stories about tourists and ex-pats having been drugged with this “burundanga” drug, then having had their kidney removed (trafficked on the organ black market) and waking up in bathtub full of ice with a slimy note on door.

Seriously, comparing Canada with Brazil is like comparing apples to pineapples. Unless, of course, Mark Carney’s next job assignment would be “Governador do Banco de Espírito Santo”.

#185 Connecting dots on 04.03.16 at 8:04 am

142 World iterations on 04.02.16 at 4:33 pm

There is an amazing collection of statistically skewed maps from BoA.

http://www.bofaml.com/content/dam/boamlimages/documents/articles/ID16-305/bofaml_transforming_world_atlas_2nd_edition.pdf

===

According to this document Canada’s #1 export is vehicles and car parts.

Over 100000 people put down $1K deposit on the new Tesla before they saw it. An other $1.5 within a day of introducing it.

The Blackberry moment of the car industry?

#186 TurnerNation on 04.03.16 at 9:13 am

Person mentioned selling Dow here. Seems a few weeks too early imo.
Lots of ops for schlock pickers. I like the online payments space: entrenched but not yet legacy PayPal, and Square – recent IPO. Both should be good for a few points then out.

#187 Nelson on 04.03.16 at 9:26 am

So don’t buy at the top but load up on US investments…hmmm……

In a balanced and diversified portfolio there is no ‘loading up’ on any asset class. Keeping about 20% of the growth portion in a 60/40 account in diversified American assets is a reasonable and sane approach. Besides, this is is the global economic engine. You really want to be decoupled? — Garth

#188 Ontario's Left Coast on 04.03.16 at 9:28 am

#85 Freedom First on 04.01.16 at 11:22 pm
#31 Flop

…..not my main goal in life anymore…..

…………………………………………………

Blasphemy!
I am stunned Flop. Welcome to Freedom! Perspective. You have arrived!

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

Hey Freedom,there is something different about you since you ended your hiatus.

The person who assumed FFs handle following the ‘hiatus’ is not Freedom First. The narrative tone and writing style (which can’t easily be changed) aren’t even close. The new guy has a much better mastery over the language. That being said, he is much more likeable than the original.

#189 Apocalypse2016 on 04.03.16 at 9:39 am

Trump is right, and he is the most economically informed and spin-free of all the candidates.

A huge, historic recession is bearing down on America.

http://www.cnbc.com/2016/04/03/trump-predicts-very-massive-recession-in-us.html

Add this to the collapse of Brazil into chaos (the world’s seventh largest economy and bigger than Canada’s) plus war spreading from the middle east and central Europe and North Korea, and we have disaster ahead.

“We’re not at 5 percent unemployment,” Trump said.

“We’re at a number that’s probably into the twenties if you look at the real number,” he said, adding that the official jobless figure is “statistically devised to make politicians – and in particular presidents – look good.”

Since 2008 the U.S. economy has floated on one credit card cash advance after another. It has all been an illusion. People are poorer, jobs are scarcer, official unemployment rates are a lie.

Next it comes crashing down.

#190 cramar on 04.03.16 at 9:47 am

Ain’t the picture the truth!

#191 BS Paulista on 04.03.16 at 9:52 am

#159 Brazil ex-pat on 04.02.16 at 9:13 pm

….
I have been saying the same thing….over and over…..BOTH countries have problems. But the women in Brazil are hotter, the weather is warmer and the food is yummier……”

Cheers !!

Well you had me listening until you said Brazilian food was good….been there many times and it is amongst the worst foodie places I have been……maybe you should visit Asia, Italia, etc. Feijoada and stuffing oneself with churascarria BBQ is not gourmet cuisine! Also the level of obesity in Brazil may be worse than even Canada!
Warm weather???Well West Africa also has warm weather, but who actually wants to live there, other than mosquitos?
Free stuff? Usually when something is free, it is not worth having!

#192 Tony on 04.03.16 at 10:01 am

Re: #172 from the mouth of a wolf on 04.02.16 at 11:38 pm

Or this one from youtube:
https://www.youtube.com/watch?v=yyGKTKSKCiU

#193 @ #7 Wooba on 04.01.16 at 6:29 pm on 04.03.16 at 10:12 am

@ #7 Wooba on 04.01.16 at 6:29 pm You can’t keep anything except your RRSP and TFSA. I know I had non-resident status for 20 years. Make sure you can access your RRSP and TFSA via online outside of the country, otherwise you won’t be able to trade when needed. RBC Direct wouldn’t allow me to access my RRSP for 20 years, they basically screwed me out of $90,000 because I had to keep high MER mutual funds for that time and wasn’t allowed to re-allocate once a year.

#194 CHERRY BLOSSOM on 04.03.16 at 10:33 am

One can’t help notice that the younger generation don’t really know how to use their brains. They know how to tap an app. I wonder if Apple and Microsoft have conspired with governments on how to render the masses non thinking, entitled to government dole outs. Way easier for the government to control a population of idiots and people growth out of control. Governments should just put something in the water to slow down the birthrate. We really don’t have to have growth at all costs. And speaking of climate change I don’t hear anything about paving the earth with highways and coverage it with high-rises. Kinda like smothering the earth. It’s not all carbon. Again population control would slow down the building and paving.

#195 Immigrants on 04.03.16 at 10:46 am

I was catching up on old blog posts. What a shame blaming immigrants for our problems. But it is the way for the last 100 years. Remember the Irish famine? What about the Scottish? We blamed them for our problems.
It’s said its a fact of life we always blame new people for our problems.

Here is a fact. Most 20 something kids born in Canada don’t work love home and live off mommy and daddy.
They go to university and earn degrees

They don’t work in macdonalds or timmys, that’s beneath them!

My point I do income tax for many new Canadians and they work two or three jobs. Here’s an example of a couple I prepared a tax return for.They make 4,000 a month between them, two jobs each, pay 800 a month in rent and about 700 in living expenses. And save the rest. Amazing.
Newly arrived Canadians are extremely hard workers.

Back to debt, I really don’t know when the musical chairs will end, 30 billion deficit is pretty small compared to total budget. But your right about Canadian citizens. I read a Facebook page that a young man of 30 said I just got approval from the bank for a loan to buy a Porsche.
Now that’s stupid.

Back to housing

#196 Caught In The Grip on 04.03.16 at 10:48 am

I just finished listening to your interview on Talk Digital Network – This Week In Money.

I’m an investor & health professional. Your commentary & advice are very good. Great interview!

Thanks!

I look forward to more of these radio shows.

Shawn

#197 The dude on 04.03.16 at 11:40 am

Hey Garth did you see your name mentioned in the globe and mail this weekend?

#198 David Lee on 04.03.16 at 12:01 pm

Literally priceless!

http://www.vancouversun.com/touch/north+vancouver+condo+sold+500k+below+value+double+ending+sale/11826617/story.html?rel=813152

#199 joblo on 04.03.16 at 1:06 pm

Hello Gerbils.

“My message to young people is not to get entangled with the Canadian system at all…get out of Canada the day after you graduate.”

Care to share reasonable locations to locate for recent Grads?

#200 TRT on 04.03.16 at 1:16 pm

About to make the big move Garth.

To California.

Just don’t want to pay taxes to fund boomers healthcare in future …

Many in my cohort talking same. TN1 Visa baby!!!

Will come back to collect pensions and healthcare when needed.

Vancouver going to be short many health professionals in coming years. The gig now is get a subsidized education and leave. Lol

#201 TRT on 04.03.16 at 1:23 pm

Farmland prices in the plains of northern India have plummeted from about RS40 lakh per acre to about RS20 Lakh per acre.

50% decline. They had their own version of HAM; ‘Black’ money was being pumped into land by tax evaders and then it stopped one day. What happens if HAM stops one day? A Taxi plate licence n Uber moment?

Regardless, the average worker can never afford a house there…even on the plains. Should get rid of all income taxes and tax real estate and wealth. Only solution going forward.

#202 BS on 04.03.16 at 2:00 pm

Bram on 04.02.16 at 1:50 pm
It looks like prices in East Van is still rising.
I was watching a house in my neighbourhood that was listed at $2M+ thinking it was overpriced.

https://www.google.ca/maps/@49.2317314,-123.1046232,3a,75y,354.36h,78.7t/data=!3m6!1e1!3m4!1syx7X9kCm9E6dM3bPg7GK5w!2e0!7i13312!8i6656

It is a pretty mediocre house east of Ontario, standard 33ft lot. It is close to the school though.
And last week, it sold!

You call that a mediocre house? LOL, only in Vancouver. That house would be overpriced at $150K any city in the US. A total eye sore of house in a bad neighbourhood any self respecting person would be embarrassed to live in. The funny part is suites rent for $500 per month in that area. Paying $2 million to live there will make Nortel look like a bargain at $120 per share.

#203 Immigrant, too on 04.03.16 at 2:28 pm

#195 Immigrants on 04.03.16 at 10:46 am

Here is a fact. Most 20 something kids born in Canada don’t work love home and live off mommy and daddy.
They go to university and earn degrees

They don’t work in macdonalds or timmys, that’s beneath them!

My point I do income tax for many new Canadians and they work two or three jobs. Here’s an example of a couple I prepared a tax return for.They make 4,000 a month between them, two jobs each, pay 800 a month in rent and about 700 in living expenses. And save the rest. Amazing.
Newly arrived Canadians are extremely hard workers.

I am immigrant too. Newly arrived Canadians are extremely hard workers indeed, and with this we do contribute to pressure wages down. With this we re-create the cycle of working extremely hard for low wages – not by choice but because we don’t have the extra resources t avoid this. Working at mcdonalds or timmy below living wage is a matter of survival not a matter of pride of achievement.

#204 For Medium Growth Portfolio on 04.03.16 at 2:32 pm

Want to start investing. I have moved funds to an investment brokerage account. Looking for where to start.

Considering to start with iShares AOM with $5500 and then add $100/month. After a year, I can see how it goes then increase or decrease the investment to this fund.

After a year, might consider for more growth and US based investment – not sure if AOR is alright or not or if AOR belongs to this group.

I can see iShare provides Portfolio configuration at: https://www.blackrock.com/ca/individual/en/investment-ideas/core-tool however, apparently, highly maple focused. Based on this article – I do not find the portfolios very attractive.

#205 No more offshore secrets on 04.03.16 at 3:02 pm

Biggest data leak ever! Get the popcorn ready as this is the story of the year!

http://panamapapers.sueddeutsche.de/

#206 Brazil ex-pat on 04.03.16 at 3:03 pm

#191 BS Paulista on 04.03.16 at 9:52 am
#159 Brazil ex-pat on 04.02.16 at 9:13 pm

….
I have been saying the same thing….over and over…..BOTH countries have problems. But the women in Brazil are hotter, the weather is warmer and the food is yummier……”

Cheers !!

Well you had me listening until you said Brazilian food was good….been there many times and it is amongst the worst foodie places I have been……maybe you should visit Asia, Italia, etc. Feijoada and stuffing oneself with churascarria BBQ is not gourmet cuisine! Also the level of obesity in Brazil may be worse than even Canada!
Warm weather???Well West Africa also has warm weather, but who actually wants to live there, other than mosquitos?
Free stuff? Usually when something is free, it is not worth having!

+++++++++++++++++++++++++++++++++++

I guess there is good and bad food everywhere. Just got back from Hong Kong. Worst food I have ever had eating while away…….While here in Porte Alegre I never have a problem finding good eats and the Zaffari has awesome meat and produce.

cheers.

#207 calling out BS on 04.03.16 at 3:11 pm

#200 BS on 04.03.16 at 2:00 pm

Bram on 04.02.16 at 1:50 pm
It looks like prices in East Van is still rising.
I was watching a house in my neighbourhood that was listed at $2M+ thinking it was overpriced.

https://www.google.ca/maps/@49.2317314,-123.1046232,3a,75y,354.36h,78.7t/data=!3m6!1e1!3m4!1syx7X9kCm9E6dM3bPg7GK5w!2e0!7i13312!8i6656

It is a pretty mediocre house east of Ontario, standard 33ft lot. It is close to the school though.
And last week, it sold!

You call that a mediocre house? LOL, only in Vancouver. That house would be overpriced at $150K any city in the US.

===

Overpriced at $150K ANY US city, eh, like NYC, SF, LA? In which year?

#208 sockeye sam on 04.03.16 at 3:23 pm

#198 David Lee

A view will fetch you any where between $300, 000.00 and a half a Mil. in these parts.
Waiting for all the Ontarian disagree-ers.
Enjoy your snow storm!!!

#209 Chauvinist Cansycho on 04.03.16 at 3:37 pm

“We are socialists, we are enemies of today’s capitalistic economic system for the exploitation of the economically weak, with its unfair salaries, with its unseemly evaluation of a human being according to wealth and property instead of responsibility and performance, and we are all determined to destroy this system under all conditions.”
– A. Hitler

#210 Panama papers on 04.03.16 at 3:37 pm

#238 jess on 04.02.16 at 7:22 pm

The Law Firm That Works with Oligarchs, Money Launderers, and Dictators

By Ken Silverstein
December 3, 2014
http://www.vice.com/author/ken-silverstein

http://www.taxjustice.net/2016/03/30/panama-the-making-of-a-tax-haven-and-rogue-state/

#203 No more offshore secrets on 04.03.16 at 3:02 pm

Biggest data leak ever! Get the popcorn ready as this is the story of the year!

http://panamapapers.sueddeutsche.de/

——

https://www.icij.org/project/luxembourg-leaks/explore-documents-luxembourg-leaks-database

ICIJ’s Luxembourg Leaks investigation is based on a confidential cache of secret tax agreements approved by Luxembourg authorities, that provide tax-relief for more than 350 companies around the world. These private deals are legal in Luxembourg.

In this interactive application ICIJ has created a visual and searchable database of 548 tax rulings that have been approved by Luxembourg officials with a stamped and signed confirmation letter. In addition, ICIJ is publishing 16 other documents — such as corporate tax returns — related to companies in Luxembourg.

On December 9, 2014, ICIJ released on this database a small new batch of Luxembourg tax rulings. ICIJ received the documents after the publication of the first installment of stories on Nov. 5.

The new documents are Luxembourg tax rulings sought by a variety of accountancy firms on behalf of corporate clients from around the world. The files cover the period from 2003 to 2011. ICIJ is only publishing the rulings that were reported on by ICIJ and its media partners and that bear evidence that they were approved by Luxembourg authorities.

Companies associated with Canada:
3i
Abry Partners
ACE Group
Archangel Diamond Corporation
BAYTEX Energy Corp
Bluebay (now Royal Bank Of Canada)
Brookfield Asset Management
China Petrochemical Corporation (Sinopec)
China Yunnan Metallurgical Group
Doughty Hanson
Encore Consumer Capital
ESO Capital Group
EVRAZ Group
Fairfax Financial Holdings
Golden Gate Capital
Graymont Group
Harbinger Group
Heinz
Highland Capital Partners
Hutchison Group
Innisfree Fund
Knight Business
Li Family Trusts
Macquarie Group
Pacific Century Group
PALA Investments
Panorama Capital
Perry Capital
Procter & Gamble
Public Sector Pension Investment Board
TINICUM
Tyco Group
United Technologies Corporation
Vermilion Energy Trust
Viva Group
WE Group
Yamana Gold

#211 For those about to flop... on 04.03.16 at 3:40 pm

I’ve got to come to Brams defence.
That is a mediocre house for that area.
There are a lot of new builds that make that house look worse than what it is.
I haven’t worked over there recently but I helped build several houses over there4/5 years ago and I noticed how nice some of the houses are.

Regarding getting a suite in that area for 500 a month must be a family discount.
Maybe you can get a room for that but the last time I looked a one bed was going for close to 900and a two bed for around 1100…

M41BC

#212 For those about to flop... on 04.03.16 at 3:55 pm

Here is a little bit of an example as to what I was talking about…

M41BC

https://vancouver.craigslist.ca/van/apa/5520965667.html

#213 Brendan Harris on 04.04.16 at 9:09 am

What I don’t understand is in one post you talk about how young people don’t think interest rates will increase, especially in the mid-term and you call them stupid, but then in another post like this one you say how there will be flatlined growth for a generation (or at least that is what it appears you’re implying). How can the two be mutually exclusive?

(a) I called nobody stupid. (b) Rates will not stay where they are today, but they will not normalize to levels of two decades ago. — Garth

#214 Wow. Who’d have thought? on 04.04.16 at 1:53 pm

Some of the world’s most successful and powerful people have private stores of wealth. Wow. Who’d have thought? — Garth

In other news:
New Orleans man facing 20 years in jail over stealing $31 worth of candy

http://www.businessinsider.com/new-orleans-man-facing-20-years-in-jail-over-stealing-31-worth-of-candy-2016-4

Wow. Who’d have thought?