Acceptable risk

“But I get 8%,” Jill said, her voice starting to rise on the phone. “And it’s secured. What could possibly be wrong with that?”

Poor woman. The typical mortgage investment corporation investor – older, unsophisticated, afraid of stocks and bonds but who understands interest and has owned real estate. So when she sold her home and needed retirement income she plowed a few hundred thousand into a MIC offering a return six times higher than a GIC and based on an asset she knew all about. Houses.

Of course, being a prick when it comes to bubbles and inflated expectations, I gave Jill the facts.  She’d just locked her precious, never-to-be-duplicated savings into second and third mortgages made to deplorables who didn’t qualify for bank loans to buy property at the most bloated levels in history, with no guarantee.

“B..buu…but,” she stammered, “They’re mortgages. Mortgages are backed by stuff – houses, properties.”

Yeah, first mortgages are, I countered. If the borrower walks the lender gets money back eventually. But not title. The trouble with MICs is they usually lend seconds at crazy rates and aren’t federally insured. Risk drips out of every orifice. Did you not wonder, Jill, why they pay 8% when the bank’s offering 2%?

She hung up.

These days MICs are big business, especially since Home Capital started croaking. Business has been booming for these subprime lenders whose mortgages can easily cost 10% to 12% or more for desperate borrowers the banks have shunned. Immigrants, commissioned salespeople with variable incomes, the self-employed, folks with a blemished credit record or anyone who admits to following this blog are among the walking dead who require such lenders. As Home cuts back on its lending to conserve cash and cling to life, little mortgage brokers (who may sell jewelry or falafels on the side) have been busy arranging loans which are then funded by pools of money from private investors. Like Jill.

Rates are stiff because they reflect true risk. The lousier the credit rating of the borrower the higher the chances of default and unrecoverable loss (especially in a declining market) and therefore the more interest the lender demands (passing it on to the investor). It makes you wonder: in a country where households owe more money than the entire stock market’s worth, with stagnant incomes and diminished savings, why can you still borrow from the bank at 2.5%?  The answer is simple: CMHC.

But there’s no taxpayer-funded monolith standing behind the MICs. If a borrower blows up – typically because a real estate correction puts them underwater and it’s easier to go bankrupt than make payments – the first mortgage-holder will sell the property to recover what it can. The second lender gets the scraps. Or nothing.

As Home Capital reduces its lending and the housing market lurches into a high-listings, low-sales, weakening-prices mode, rates are jumping. And this market is huge – with about $400 billion in mortgages made through subprime lenders now out there in the big cities, mostly in the GTA (Toronto, Brampton, Mississauga). The more borrowers who end up getting their money here, and the more Jills who foolishly fund them, the more risk the entire market is at. We don’t need to have the Bank of Canada spike rates. They’re already ballooning for an army of people.

And speaking of CMHC, word has surfaced this week that mortgage loan volumes have collapsed – at least those insured by the feds. There’s been a fat 41% drop, the agency says, the result of the moister stress test Ottawa brought in late last year, plus higher premiums – and declining real estate activity. You may remember that first-time buyers now have to qualify for loans not at the cheapo bank rate, but the central bank’s five-year standard rate of 4.64%. To get around that there’ve been more withdrawals from the Bank of Mom as parents borrow against their own houses to give down payment cash to their spawn. Yes, debt gifted to the kids so they can qualify for more debt.

All this is worrying people who don’t live here, look at us and shake their heads. Like the dudes at the International Monetary Fund.  Once again they’ve warned our housing market is unsustainable, point to the recent downgrades of Canadian banks as evidence, and say governments (like those in BC and Ontario) who blame foreign buyers are probably misguided. Far better to replace such discriminatory, xenophobic taxes with measures to curtail speculation, they say.

So, it’s all about risk. Borrowers buying into a declining housing market are embracing it. People like Jill who fund subprimes are swimming in it. Systemic risk bubbles higher as the mortgage pie gets less insured, less regulated. And now governments are certain to make the outcome worse.

As yesterday’s comments showed, that’s on you.

160 comments ↓

#1 Noname on 05.31.17 at 5:36 pm

first!!

#2 The First Bilderberger on 05.31.17 at 5:39 pm

Garth my friend..what do you think that they will discuss in Chantilly VA, USA 1-4 June. Are “They” are going to discuss about the monstrous Canadian RE bubble and its potential to bring populists in power in Canada?

http://bilderbergmeetings.org/press-release.html

Our common friend Bill Morneau is invited, I hear he’s going to give a lecture of how to run a country into the ground in 5 easy steps via inflating its FIRE economy..

http://www.bilderbergmeetings.org/participants.html
Minton Beddoes, Zanny (INT), Editor-in-Chief, The Economist
Molinari, Maurizio (ITA), Editor-in-Chief, La Stampa
Monaco, Lisa (USA), Former Homeland Security Officer
Morneau, Bill (CAN), Minister of Finance

The key topics for discussion this year include:
The Trump Administration: A progress report
Trans-Atlantic relations: options and scenarios
The Trans-Atlantic defence alliance: bullets, bytes and bucks
The direction of the EU
Can globalisation be slowed down?
Jobs, income and unrealised expectations
The war on information
Why is populism growing?
Russia in the international order
The Near East
Nuclear proliferation
China
Current events

Can you please ask in the CANADIAN PARLIAMENT WHO’S PAYING FOR HIS TRIP. CAUSE IT’S MY MONEY BRO, AND I’M ROYALLY PISSED…ROTFLMAO

I want these lame schmucks to try to earn their living for one day, they wouldn’t be fit to be janitors in a normal world..

#3 The Technical Analyst, CSTA, CPD on 05.31.17 at 5:43 pm

I wanted to point this out as it is an important market move for the past week.

Chinese nationals are re-patriating their funds back to China with the largest bullish rally in years of the USDCHN.

Does this mean money is leaving Canada? I donno. But it means money is being pulled back to China around the globe.

#4 I'm stupid on 05.31.17 at 5:44 pm

Of course she hung up, she’ll call someone else that will give her the security she’s looking for. No one wants to hear the truth, they just look for advise that legitimizes their own beliefs. Even if those beliefs are wrong. Good luck Jill, I’m sure you’ll be wondering how you lost it all. The answer was given to you prior to hanging up.

#5 Retired DND on 05.31.17 at 5:47 pm

talking about risk anyone know a good India ETF

#6 dave on 05.31.17 at 5:51 pm

$400Billion sub prime. is this your attempt at fake news, Garth? Seriously overstated. the MICs and true alternative book for the monolines is less than 5% of the market, and Ben T and BoC would all agree to that. can’t include the First Nationals etc – unregulated, yes, but as prime as prime can get. unregulated doesn’t mean sub prime in Canada. waaaaaaay off the mark.

Not according to Home Capital documents. It estimates between one-quarter and one-third of the $1.2 trillion mortgage market is subprime. — Garth

#7 InvestorsFriend on 05.31.17 at 5:55 pm

But Defaults Remain Low

Of course no one need default if their bank provides skip-a-payment (or four) and such features to turn missed payments into sanctioned behavior. And no one need default as long as new loans are available to make payments on old debt.

Any bank can keep its defaults ultra low by lending new money to its existing borrowers. Until one day it decides not to…

#8 Crypto on 05.31.17 at 5:55 pm

Tell Jill about something that is as risky as a MIC, but has *infinitely* more potential.

The Ethereum crypto coin went in 1 yr from:
cad$18 to cad$310.

Yes, people, a +1622% in a year. Not a typo.

#9 InvestorsFriend on 05.31.17 at 5:57 pm

Truth in Advertising

Some of these outfits advertise that their loans are “secured by real estate”. They fail to mention if it is fist mortgage versus third.

#10 TorontoSux on 05.31.17 at 6:04 pm

I recognize that sign, its from Gunnison Beach in Sandy Hook, New Jersey, a fantastic beach, highly recommended….cool to see that photo here at Garth’s blog!

#11 Mike in Calgary on 05.31.17 at 6:09 pm

I get pissed off every time I see Bill Good plugging Capital Direct on BNN. “and it’s all secured by real estate…I can understand that”.

So can I Bill. So can I.

#12 InvestorsFriend on 05.31.17 at 6:17 pm

Banker Tricks

Banks are in it to make money of course.

Some years ago a friend ended up with mortgage at Home Capital and in over her head with house too expensive.

She was trying to sell the house and conveniently the mortgage came up for renewal. But Home Capital charges a VERY high rate on an open mortgage which she could not afford and therefore was somewhat forced to renew for several years in order to get a lower payment.

Then the house sold and Home Capital wanted $13k interest differential fee on like a $130k mortgage. I talked to a V.P. there and he reduced it to $7k and I thanked him since he was under no obligations to reduce.

Somewhat sweet justice to see Home on the rocks now after they squeezed so many people like my friend.

#13 Ace Goodheart on 05.31.17 at 6:21 pm

RE: “But I get 8%,” Jill said, her voice starting to rise on the phone. “And it’s secured. What could possibly be wrong with that?”

If it’s syndicated, she’s in trouble. Last in line. Not sure if that’s what she’s gotten herself into, but a bunch of people recently lost their entire life’s savings on syndicated mortgage investments, with the money reportedly being spent on promotions and partying by those in charge.

#14 JSS on 05.31.17 at 6:26 pm

National Bank increases dividend

http://www.newswire.ca/news-releases/national-bank-increases-the-dividend-of-its-common-share-625465183.html

Rub tummy

#15 Kikuyu on 05.31.17 at 6:28 pm

New reader to this blog and I’m lovin’ it!

Anybody know what happened to the Toronto Real Estate Board versus Competition Tribunal for release of MLS sales information to the general public?

The appeal was heard in December 2016 but no news yet!

#16 Looney Baloney on 05.31.17 at 6:40 pm

ShareMyHouse™ – a stock market for housing. It will work similar to HELOCs. Any equity a homeowner acquires in excess of 51% of the current valuation of their property will be tradable on a stock market exclusive to housing.
Now is Canada’s chance to innovate and cement our place as a world leader in real estate.

A setup like this will:
– Introduce much needed liquidity to the housing market
– Gramps can rent cash flow without losing their shelter
– Makes housing affordable again to moisters
– Investors can expand the REIT portion of their diversified portfolios with commercial realestate
– Reduce taxes for owners without reducing tax revenue
– Jill can invest in what she knows – houses, without shouldering too much risk
– Much easier to divide in case of a divorce

#17 Pete on 05.31.17 at 6:42 pm

Garth, why did you waste your breath explaining to Jill who does not even understand the most basic in investing: higher return means higher risk?

#18 Dan.t on 05.31.17 at 6:44 pm

Again, same post today, just because…What is wrong with people in Canada? Fools buying houses for 500k without seeing the house? Buying tear downs for a ton of money and sinking more into them? 500k condos?? Even detached houses for 500k is a ton of money but I guess not in Canada.

It’s pocket change. Free money from the bank, money from mom and dad, credit cards, I mean, seriously, it’s just debt but good debt as long as you buy a Piece of S++t cardboard, pressed board box, with shoddy construction and

Seriously, people spend more time choosing a 6-pack of beer than they do spending half a million on house speculation.

I see brick houses here, older than Canada and still standing for cheaper than some plywood, 30 year old tear down on the outskirts of butt f**K no where for a quarter of the price.

Get over yourselves Canadians. The whole world does not want to buy your crappy tear down. Other Canadians…well, that is a different story it seems. They will buy the promise of never ending Real Estate glory and riches for whatever amount of debt they can get themselves into.

A country of house horny financial illiterate, debt pigs. Yes, I believe in BC, Christy Clark and the liberals sold out British Columbians to the highest bidding foreigners, and money laundering is rampant but it was the locals who pushed prices to bubble territory.

No other topic matters in Canada but Real Estate. It is a religion. Bow to the almighty marble counter tops and hardwood floors! Doesn’t matter if the bank owns 80% of your altar and you had to sell your soul to get it.

You know what I pray for… that at some point people see how stupid this all is. It is fine if you can afford to pay for a 1.2 million dollar home, but the reality is, that no average family can actually afford that and yet average home prices are near or over that price range and crappy condos are running near half a million. What is wrong with you people.

And still, comments here, any drop, people are ready to vultch…nothing will change until it does.

#19 garth reader on 05.31.17 at 6:44 pm

“All this is worrying people who don’t live here, look at us and shake their heads. Like the dudes at the International Monetary Fund.”
======

Hi Garth and blog dogs…

Can any of you explain why non Canadian outfits are worried about our debt lust? I thought the Canadian economy was so small that any crash would have little effect on world financial markets??

#20 Joseph R. on 05.31.17 at 6:47 pm

#8 Crypto on 05.31.17 at 5:55 pm
Tell Jill about something that is as risky as a MIC, but has *infinitely* more potential.

The Ethereum crypto coin went in 1 yr from:
cad$18 to cad$310.

Yes, people, a +1622% in a year. Not a typo.

—————————————————–

What can you buy with “Ethereums”?

It’s most famous cousin, Bitcoins, only uses seems to be illegal drugs, ransomware and pornography of questionable legality.

#21 espressobob on 05.31.17 at 6:51 pm

Like DIY investing isn’t hard enough? Risk is real. Quality counts, always has. Hell could be waiting on the other side otherwise.

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

#22 fartonomics on 05.31.17 at 6:51 pm

if a home sells for under asking
does any body hear about it through the news?

#23 Flatlander on 05.31.17 at 6:57 pm

Yikes…
http://www.ctvnews.ca/business/b-c-investor-fears-1-million-at-risk-in-gic-1.3437415

#24 Dave on 05.31.17 at 6:58 pm

Trickle down economics & tax havens for the rich experiment – now over 30 years old – in practice has turned out to be – trickle up economics. The rich getting richer and poor getting poorer. The massive erosion of the middle class by the trickle down theorists.

We see this in the real estate market where the super rich – made by the trickle down theory and tax haves – are massively investing in residential real estate – mainly condos. The Chinese, the Russians, Asians etc are buying in secure countries such as Britain, Canada, Australia.

Most big condo developments are pre sold to foreign buyers. They’re not even available to locals – thus creating shortages of available property for sale – even though the number of condo developments in these countries is mind boggling. Some of them are completely empty.

The locals cannot possibly compete with these oligarchs and are forced, forever, to be renters.

Garth keeps bashing the local purchaser for borrowing so much. But, what choice do they have? Be, forever, renters? He should be getting down to the real reason for this mess – the utopian theory of trickle down economics and tax haves for the rich which in practice has been a disaster for the middle class.

Healthy middle class is what drives the economy – not trickle down theory or tax haves for the rich.

#25 GDP up...some good news on 05.31.17 at 7:01 pm

March GDP +0.5%.

Manufacturing, retail and wholes sale trade and oil and gas the big contributors.

If RE et. al. begins to unravel, maybe the rest of the economy can offset it, well, in March at least.

Probably thanks to our “dollarette”.

If nothing else, some good news.

#26 Sultan of Sudbury on 05.31.17 at 7:05 pm

#14 JSS

Don’t you get it? It’s peddle to the metal on all fronts until SHTF.

#27 bill boy on 05.31.17 at 7:07 pm

Why get upset over what Bill Good says or shills for. He had lost credibility ever since showing his support for Campbell’s Liberals. Did you see how his former colleague Taggart and Killeen were visibly upset when announcing the news ndp/green partnership? Enjoy a sunny day

#28 AK on 05.31.17 at 7:15 pm

“But I get 8%,” Jill said
——————————————————————–
A number of large REITS on the TSX pay between 5 and 6% with favorable tax treatment (Return of Capital).

A lot less of a risk than MIC’s.

#29 marcuzzo on 05.31.17 at 7:18 pm

nobu condos just went for sale in Toronto

1000 per square foot

bought FIE instead… how did I convince the wife…

take her out to dinner tonight ;)

#30 Doug t on 05.31.17 at 7:22 pm

Money, it’s a crime
Share it fairly but don’t take a slice of my pie
Money, so they say
Is the root of all evil today
But if you ask for a rise it’s no surprise that they’re giving none away

RATM

#31 Long-Time Lurker on 05.31.17 at 7:24 pm

Nice article, Garth. Thank you for continuing your blog.

Some news from memory. No sources. You can look it up or disbelieve me.

Amazon stock hit $1000US yesterday. I think Bezos still isn’t giving out a dividend. Back in the spring I wrote it wasn’t spiking. My bad.

Warren Buffett is sitting on $50 billion in cash –40% of his assets– waiting for the U.S. market to crash. (Secondary source. Numbers from memory. Exact number is forgotten.)

Red China has finished it’s development cycle from a low to middle-level sophistication economy. Low-cost manufacturing production has moved to other less developed southeast asian countries. Expect a decline in Red China. (Jim Rickertts)

Red China has big credit problems in their banking system.

A few hedge fund managers deriding current market conditions.

Australia is in the same pickle as Canada. Housing bubbles and vulnerable economy.

Auto loans in the US have been collected together and securitized for $1 billion. So now there are collateralized-debt-obligations in their car market.

Arizona made gold legal tender, thumbing their nose at the Federal Reserve.

Jill, don’t renew your GIC with them. Be safer.

#32 For those about to flop... on 05.31.17 at 7:24 pm

Well Adam ,when I asked you the other day after helping me do a snapshot of the market I asked you if you would help me again.

You did not respond and so being Tasmanian I am both stubborn and stupid in equal measure,so here I go again.

You don’t ask ,you don’t get…

M42BC

Recent sales or removals.

955 Forest Hills Drive, North Vancouver paid 1.9 ask 1.8

4250 CHELSEA Crescent, North Vancouver paid 3.15 ask 3.28

4302-4508 HAZEL ST BURNABY paid 1.38 ask 1.5

1401-6659 SOUTHOAKS CRES BURNABY paid 650 ask 555

845 Drayton st. North Vancouver paid 1.53 ask 1.64

5830 Alma st. van paid 3.4 ask 3.5

5020 Hollymount Gate Richmond paid 1.28 ask 1.39

2712 Pandora st. Van. Paid 1.29 ask 1.39

3509 Turner st. Van paid 1.4 ask 1.49

Thanks in advance,Flop…

#33 broader mind on 05.31.17 at 7:24 pm

Funny thing , Home Cap was in no real trouble financially until a few Hedge funds decided to wipe it out with Fake news. A few rumors put a run on them. Lucky pension fund picking up a free mortgage company. All those nice dividends redirected to a pension fund that knows Canadians will not flake on their mortgages the way Americans did. Sadly the success at destroying Home Cap is now allowing them to walk all over our banks. Ever seen so much international news about Canada the indebted nation. Smokey calls this the machine. Real and powerful. Coming soon – the big six in Canada under investigation ( for making to much money)

#34 I'm not Poloz on 05.31.17 at 7:33 pm

Will Stephen S. Poloz resort to cutting interest rates to 0.25% to save the real estate bubble in the center of the universe Toronto and the outlying suburbs which make up the Greater Toronto Area?

Kathleen Loser is vowing for a $15/hr min. wage in Ontario by 2019, but do you know that Poloz will decimate the Loonie to 45 cents that the $15 will only be valued $6-7.50US dollars in American currency?

Poloz warned and threatened that he will slash rates and introduce Quantitative Easing to boost exports while creating Loonies out of thin air to boost exports to a protectionist America.

#35 JG on 05.31.17 at 7:54 pm

sooo… I wonder how the guys at Fortress and FDS Mortgage Brokers are doing with all the legal mumbo jumbo going on?

#36 InvestorsFriend on 05.31.17 at 7:58 pm

He did not understand the risk…

From a link at 23 about a Home Capital GIC investor

“I wasn’t given all the information,” Bidner said. “Had I been told that I was secured to $100,000, I would never have invested in that.”

***********************************
Funny thing about risk is that in fact it really CANNOT be precisely measured. That’s why it’s called risk.

The InvestorsGroup rep who recommended a GIC from what appeared to be a safe bank now has to put up with this whiny customer. I have little sympathy. The fact is the dude will almost assuredly get his money back at the maturity of the GIC.

Says he did not understand the risk. Actually he appears to be vastly over estimating the risk now. The GIC was and is low risk, actually. But (newsflash) low risk is not the same as no risk.

He did not know GICs are insured by the government only to $100k? Really, should we believe that?

#37 Andrew t on 05.31.17 at 7:58 pm

“My view still is that three rate hikes this year makes sense,” John Williams, the president of the Federal Reserve Bank of San Francisco, told Bloomberg News in Singapore on Monday. “Nothing has pushed me away from that. We should continue this gradual process of policy normalization in interest rates.”

https://www.nytimes.com/2017/05/30/business/economy/fed-inflation-interest-rates.html

#38 Wicked as it seems on 05.31.17 at 8:00 pm

http://www.greaterfool.ca/2017/05/31/acceptable-risk/#comment-519473 Yes Bill Boy I did notice taggert and Killeen faces when confronted with ndp….just do you job and read the news without bias!

#39 AGuyInVancouver on 05.31.17 at 8:03 pm

#33 broader mind on 05.31.17 at 7:24 pm
Funny thing , Home Cap was in no real trouble financially until a few Hedge funds decided to wipe it out with Fake news. A few rumors put a run on them. Lucky pension fund picking up a free mortgage company. All those nice dividends redirected to a pension fund that knows Canadians will not flake on their mortgages the way Americans did. Sadly the success at destroying Home Cap is now allowing them to walk all over our banks. Ever seen so much international news about Canada the indebted nation. Smokey calls this the machine. Real and powerful. Coming soon – the big six in Canada under investigation ( for making to much money)
____________________________________
Well, other than writing fraudulent mortgage applications. I guess what you meant is they hadn’t been found out yet. Did Cohodes call to short HC come before the investigation or after?

#40 Spectacle on 05.31.17 at 8:12 pm

What was that I heard today on the CBC Radio…..?
Something by an ex employee in the BANKING industry employees forgin signatures on client actionable transaction/investments , 80% of employees do this .

Just wow.

That is a myth. — Garth

#41 Smoking Man on 05.31.17 at 8:13 pm

#33 broader mind on 05.31.17 at 7:24 pm
Funny thing , Home Cap was in no real trouble financially until a few Hedge funds decided to wipe it out with Fake news. A few rumors put a run on them. Lucky pension fund picking up a free mortgage company. All those nice dividends redirected to a pension fund that knows Canadians will not flake on their mortgages the way Americans did. Sadly the success at destroying Home Cap is now allowing them to walk all over our banks. Ever seen so much international news about Canada the indebted nation. Smokey calls this the machine. Real and powerful. Coming soon – the big six in Canada under investigation ( for making to much money)
….

I do contract work. IT back in 2004 I worked for one of the big 5. Rate 100 per hour. Annual profit then. 1 billion. Did a short gig Nov Dec my rate 100 per hour. They pull down 3 billion every 1/4 now or 12 billion a year.

Now if I wasent a share holder. I would be wearing black, smashing windows, and freaking out about all the temporary offshore workers that keep my rate going down.

It’s a delema. But the new leader ceo is an utter idiot I will be quite vocal at the next annual general meeting.

That ship is heading for an ice burg.

#42 conan on 05.31.17 at 8:13 pm

Taking retirement income from a mortgage based investment is insane. These funds have a habit of suspending payments if redemptions get out of whack. You have to read the small print.

On the other side of the coin there is a lot of potential for fraud. Meaning, the properties themselves are not valued properly. 888 k is written in the books, but the property is junk, worth half that.

Buyer beware….

#43 Xbox Economist on 05.31.17 at 8:22 pm

Yes, MICs and private lending are big business and a completely unregulated market. The loans being offered now, because of HCG’s problems, are predatory. The MICs are taking advantage of people who are suddenly finding it hard to renew their mortgages at the subprime lenders. The borrowers will do whatever it takes to keep their homes. Meanwhile people like Jill are killing it. Eventually the shadow mortgage market will turn and then watch out.

But let’s be honest, there isn’t a risk of a significant housing market correction until interest rates rise substantially. However both US treasury and Canadian bond yields are dropping, signalling lower mortgage rates ahead. The last Fed rate hike in March was actually considered dovish(!). The latest Canadian GDP numbers show exports are dropping so guess what Poloz is thinking.

https://www.bloomberg.com/quote/USGG10YR:IND

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

#44 For those about to flop... on 05.31.17 at 8:32 pm

Adam , a little bit more homework for you if you have time.

The last one was only a Possible Pinkie but it was a bit of a niche property with stables and a bit of land and so with your help we can see how that side of things is going…

M42BC

4263 Portland st Burnaby paid 1.86 ask 1.79

1847 Venables st. Van paid 2.01 ask 2.02

447 232 Street, Langley paid 4.15 ask 4.88

#45 Tony on 05.31.17 at 8:33 pm

Re: #14 JSS on 05.31.17 at 6:26 pm

They don’t need to increase their dividend. The short sellers of National Bank stock will increase the dividend for anyone wishing to buy the stock.

#46 Bobby13 on 05.31.17 at 8:33 pm

It’s all going to work out we elected a very intelligent and experienced leader to help navigate us through these kind of situations. I’m sure there is some currency somewhere to swap and make it all good.

#47 Pete from St. Cesaire on 05.31.17 at 8:36 pm

Can any of you explain why non Canadian outfits are worried about our debt lust? I thought the Canadian economy was so small that any crash would have little effect on world financial markets??
———————————————————-
Canadian banks are huge and are tied tightly into the total global market and are used to launder billions; and they are close to collapse. They would have already collapsed except for the bailouts and the promise of future gains when the housing bubble pops and the banks get to repossess all of the defaulted properties and more bail-outs/bail-ins. The true elites who are in-the-know aren’t worried one bit.

#48 NOTHING SURPRISES on 05.31.17 at 8:40 pm

The Canadian Goose is cooking, but I believe we may cook a great deal more!

U.S. investors should take a good look at their portfolios.

Canada is America’s most important trading partner.

Every year $267 billion worth of goods and services cross the border. That’s more than the U.S. exports to China, Japan, and the United Kingdom combined.

In other words, the fate of the U.S. and Canada are highly intertwined.

More importantly, the U.S. economy sits on a mountain of cheap money, just like Canada.

They have more auto loan, student loan, credit card, and corporate debt than they’ve ever had. Plus, the federal debt is at $20 trillion and counting. And that “official” figure doesn’t include Social Security, Medicare, or Medicaid.

In short, the U.S. economy is sitting on a tinderbox of debt. And a Canadian housing crisis could very well be the spark that sets the U.S. economy on fire.

The heat is increasing.

#49 Pete from St. Cesaire on 05.31.17 at 8:41 pm

What can you buy with “Ethereums”?
It’s most famous cousin, Bitcoins, only uses seems to be illegal drugs, ransomware and pornography of questionable legality.
—————————————————–
That’s what the media wants you to believe. Cryptocurrencies are to be demonized whenever they can be. They smack of freedom and that’s a dirty word these days. There are lots of places both on and off line that accept Bitcoin; other coins however aren’t as well recognized.

#50 Myra Andrews on 05.31.17 at 8:44 pm

Vancouver stats for May 31 posted by the Vancouver realtor Paul Boenisch

I don’t know Paul but have included his website to be considerate since it is nice of him to post these number on a Vancouver real estate blog.

New 222
Price Change 53
Sold 187
TI:8806

https://www.instagram.com/clivestevepaul/

#51 broader mind on 05.31.17 at 8:47 pm

The million dollar question. Who was the OSC working for in the timely hit on Home Capital A) Poloz B)Morneau C) Hedge Fund Group. Answer – All of the above might work

#52 Andrew Woburn on 05.31.17 at 9:00 pm

Apparently nothing, absolutely nothing, is sacred.

– Robots are coming for priests’ jobs, too

https://qz.com/994384/robots-are-coming-for-priests-jobs-too/

#53 Keith in Calgary on 05.31.17 at 9:01 pm

Need to change my handle soon to reflect my new status.

I wonder what Nelson has done with his wife as a result of the blog commentary.

Any feedback Garth ?

He replied at the end of the comments thread. — Garth

#54 Andrew Woburn on 05.31.17 at 9:08 pm

Here’s what the CBC said about document fraud. It seems to imply that there is a general problem, but from the information given here, it is hard to judge the real extent and the number of cases of actual losses to clients.

– Document forgery in financial industry more common than you’d think, past employees say

http://www.cbc.ca/news/business/financial-industry-employees-forge-documents-more-often-than-you-d-think-1.4138212

Can’t speak for the banks, but any instance of someone signing on behalf of a client – even under the client’s direct instruction – means instant dismissal for an employee and huge sanctions, disciplinary action and fines for a licensed advisor. — Garth

#55 Freedom First on 05.31.17 at 9:16 pm

#30 Doug t

It’s the love of money.

#56 India on 05.31.17 at 9:26 pm

#5

XID is the one you’re looking for

#57 DON on 05.31.17 at 9:27 pm

Isn’t Taggart the aspiring actress, who turn to announcing entertainment venues around Van then off to news reader. I guess the days of investigative journalists, earning their dues to become a anchor are over, now just pleasant looking “valley” girls and boys.

#58 Leverage on 05.31.17 at 9:30 pm

#20 Joseph R. on 05.31.17 at 6:47 pm

#8 Crypto on 05.31.17 at 5:55 pm
Tell Jill about something that is as risky as a MIC, but has *infinitely* more potential.

The Ethereum crypto coin went in 1 yr from:
cad$18 to cad$310.

Yes, people, a +1622% in a year. Not a typo.

—————————————————–

What can you buy with “Ethereums”?

It’s most famous cousin, Bitcoins, only uses seems to be illegal drugs, ransomware and pornography of questionable legalit

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

If you able to connect 2 sentences in your own post you discover you can at least dollars.

You have to try use both the neurons.

#59 Mark on 05.31.17 at 9:32 pm

“Most big condo developments are pre sold to foreign buyers. “

Never heard of this happening. Didn’t Garth post a video a while back where the buyers lined up at a particular condo pre-sale event were clearly Canadians?

Sure, there’s that ever-present racist narrative that if you’re not white, you’re not a Canadian. A slight variant on such costing the former Prime Minister the election. But looking beyond such indicates that most of the buyers of condos, pre-sale and otherwise, in Canada, are Canadian citizens, and are doing so with money earned or borrowed in Canada. Mostly the latter, not the former.

#60 Smoking Man on 05.31.17 at 9:36 pm

The wisdom of Bilderberg.

A bunch of loser elites that don’t even know what Herdonomics is.

Over schooled advisors is what I’m thinking.

#61 Squirrel on 05.31.17 at 9:38 pm

Huh???

Document forgery in financial industry more common than you’d think, past employees say

Former CIBC representative says ‘85% of sales staff’ in her workplace forged documents, encouraged by manager

http://www.cbc.ca/beta/news/business/financial-industry-employees-forge-documents-more-often-than-you-d-think-1.4138212

#62 Smoking Man on 05.31.17 at 9:49 pm

Entrupenurs two more sleeps till I unleash free invoice software.

It’s 100% free. I know what it’s like to make payroll on cash from credit cards. The un greatfull mindless widgets that voted liberal.

Im going to make alot of like minded friends quick books coders not so much.

Quick books sucks. You can’t run a business on an accounts wet dream.

#63 High on weed on 05.31.17 at 10:04 pm

Real Estate and Gold Bullion have smashed all investments except Bitcoin…..Period …since 2000

Gold’s lost 36% in the past six years. — Garth

#64 Havadonut...on me on 05.31.17 at 10:08 pm

Canadian SM TSX is hitting resistance…it just can not break through 15K….growth …what growth Commodity prices are at great recession levels even after adding 20 Trillion in liquidity….Cash out stocks/bonds now and hold cash…..do not be greedy

#65 Keith in Calgary on 05.31.17 at 10:10 pm

OK………just read how his diatribe.

He will be closing on something in 12 months. Caucasians do name their kids Nelson. Haven’t for decades.He contradicted his initial conversation to you multiple times in describing her in his reply.

I’ll bet money on it……..12 months.

#66 Keith in Calgary on 05.31.17 at 10:16 pm

You need a post edit feature……..change your blog platform.

You can buy anything with cryptocurrencies……..there are many bitcoin or ETC credit/debit cards available worldwide.

Gold has been around 5000+ years………can’t say that for any other form of money.

Sorry……..facts are a horrible thing.

#67 Smoking Man on 05.31.17 at 10:17 pm

Trashing Butts on twitter. He’s so stupid.

Vengeance served cold. Enjoy a ford ranger with roll down windows and a broken ac.

Thives.

#68 Raging Ranter on 05.31.17 at 10:51 pm

My wife’s friend was over tonight. She said her cousin in Toronto just went halfers with a friend on a place. Their plan is to rent it out on AirBnB. Apparently they can “easily” cover their expenses that way. She never said what kind of a place; I assume it’s a condo of some kind but I don’t know that for sure.

It sounded to me like just another anecdote from the very peak of the housing bubble. First in is the smart money. Then follows the lucky money. Last in is the dumb money. Now which of those best describes the above? It can’t be long now. It just can’t be.

#69 WUL on 05.31.17 at 10:53 pm

Last 12 months across Canada, bankruptcies are down 1.3%. AB over same period? Up 23.6%. Calgary? Up 30%. However, lousy reporting. No mention of personal and/or corporate!

CBC Calgary. I can copy but not paste for some reason. Maybe I’m pasted.

#70 OttawaMike on 05.31.17 at 10:54 pm

Canadian banks on notice from IMF

Invest in Canadian Bank stocks.

Suck & Blow?

The IMF said no such thing. Canadian banks just make $10 billion in the last 90 days. — Garth

#71 Joseph R. on 05.31.17 at 10:57 pm

#49 Pete from St. Cesaire on 05.31.17 at 8:41 pm
What can you buy with “Ethereums”?
It’s most famous cousin, Bitcoins, only uses seems to be illegal drugs, ransomware and pornography of questionable legality.
—————————————————–
That’s what the media wants you to believe. Cryptocurrencies are to be demonized whenever they can be. They smack of freedom and that’s a dirty word these days. There are lots of places both on and off line that accept Bitcoin; other coins however aren’t as well recognized.

————————————————————–

What makes you believe there exists a conspiracy to keep cryptocurrencies down? You see nothing wrong with a “currency” who value changes quickly on a weekly basis?

Which bank allows deposits/withdrawals in Bitcoins? Any bank accept Bitcoins to securitize a loan?

Hell, even precious (Au, Ag, Pt, Pd) coins and bullion can be used for the above purposes.

“They smack of freedom and that’s a dirty word these days.”

Compare the purchasing freedom C$3000 cash has versus a Bitcoin … Which one gives you more freedom?

If you are afraid of the government spying on your purchases and want freedom offline, just use hard cash; it’s still legal tender.

#72 WUL on 05.31.17 at 10:59 pm

Upon re-read, it appears to be personal bankruptcies. “It’s not business, it’s just personal.”

#73 GreiseF. on 05.31.17 at 11:02 pm

#31 Long-Time Lurker on 05.31.17 at 7:24 pm

Nice article, Garth. Thank you for continuing your blog.

Some news from memory. No sources. You can look it up or disbelieve me.

Amazon stock hit $1000US yesterday. I think Bezos still isn’t giving out a dividend. Back in the spring I wrote it wasn’t spiking. My bad.
++++++++++++++++++++++

It split 3 times in the late 90’s – really $1000US a long time ago if no splits.

#74 conan on 05.31.17 at 11:03 pm

#67 Smoking Man on 05.31.17 at 10:17 pm

LOL @ Smokingman

Your musings create 1000’s of new Liberal supporters every year. They are all thinking the same thing:

” I want to be on the side that Smoking Man is not on.”

https://www.youtube.com/watch?v=b2Kyl0HP1T0

#75 Calamity Jane on 05.31.17 at 11:03 pm

Thought some of you may be interested in a conversation I had with a real estate agent I collaborate with occasionally. I work in a construction related field and the agent works for one of the largest RE brokerages in Ontario. In one week just one of the lawyers she works with has 7 deals that will not be closing in Far East of the GTA. Those who think they got in just in time and are patting themselves on the back for getting $100k over asking and have already purchased their next home are finding to their surprise that they are having to renegotiate their deal in order to get the purchaser to close. Purchasers are finding the same house for less money down the street and are backing out of deals. The particular house I measured 3 weeks ago the homeowner was upset because a number of houses had come up for sale while he was working on his. Fast forward to now and 3 more homes have come up for sale on his street… it’s a small street. He still hasn’t finished his renos and now is thinking of not redoing some things because he won’t get the money out of the house he was hoping for. I asked if this was just unique to some of their clients but this is the feedback coming from all their colleagues. Paraphrasing “people have heard listings are up a bit and things have cooled down a bit but they have no idea the reality is that everything stopped over night, it’s so much worse than what the public currently realizes”. Spoke to the boss at my company and they said they heard the exact same thing from another employees spouse who is a RE agent in the 705 (Peterborough is the new “6” apparently). It’s getting scary out there and I think it’s happening far faster than people are realizing.

#76 PM on 05.31.17 at 11:04 pm

https://www.zolo.ca/toronto-real-estate/383-shuter-street

This market never ceases to amaze me. Who would in their right state of mind will pay $788k for this.

#77 Smoking Man on 05.31.17 at 11:09 pm

When you are worth something.

https://www.youtube.com/watch?v=SRvCvsRp5ho&list=RDSRvCvsRp5ho

#78 Riders of the space dust on 05.31.17 at 11:11 pm

#67 Smoking Man on 05.31.17 at 10:17 pm

Trashing Butts on twitter. He’s so stupid.

Vengeance served cold. Enjoy a ford ranger with roll down windows and a broken ac.

Thives.
..
So when ya landing in Antigua….. must be itching to start enjoying the untaxed millions of forex winnngs..

#79 DON on 05.31.17 at 11:17 pm

#61 Squirrel on 05.31.17 at 9:38 pm

Huh???

Document forgery in financial industry more common than you’d think, past employees say

Former CIBC representative says ‘85% of sales staff’ in her workplace forged documents, encouraged by manager

http://www.cbc.ca/beta/news/business/financial-industry-employees-forge-documents-more-often-than-you-d-think-1.4138212
*****************
Not if everyone is doing it…than it’s just the ‘new normal’.

#80 Smoking Man on 05.31.17 at 11:17 pm

Old strip joints

https://www.youtube.com/watch?v=1w7OgIMMRc4&index=5&list=RDSRvCvsRp5ho

#81 Smoking Man on 05.31.17 at 11:21 pm

So the spelling not too good.

https://www.youtube.com/watch?v=vx2u5uUu3DE&index=7&list=RDSRvCvsRp5ho

#82 Sunnyside on 05.31.17 at 11:52 pm

” governments (like those in BC and Ontario) who blame foreign buyers are probably misguided. Far better to replace such discriminatory, xenophobic taxes with measures to curtail speculation.”

Garth, isn’t a foreign buyer a speculator? Not to mention the money laundering going on.

#83 Nuke on 05.31.17 at 11:59 pm

In 2010 I watched Bitcoin rise from .0008 to .08 while I pondered investing $1,000. Did not invest. Same with Ethereum back in Feb 2016. Next wave is low tech adoption using Bitcoin debit cards and pos retail terminals. It is the internet circa 1995 all over again. Banks don’t get it, they think the blockchain is just a new ledger they can control in a centralized system. it is a 100% decentralized trustless platform.

#84 Doug in London on 06.01.17 at 12:01 am

@Retired DND, post #5:

Try INDY-NY for exposure to India.

#85 Sir James on 06.01.17 at 12:19 am

#8 Crypto
Bitcoin has about 30 million global users, about the size of Canada. Whats the ‘market cap’ of the Canadian Dollar?

#86 Dave on 06.01.17 at 12:41 am

MARK,

“Most big condo developments are pre sold to foreign buyers. “

“Never heard of this happening. Didn’t Garth post a video a while back where the buyers lined up at a particular condo pre-sale event were clearly Canadians?”

You don’t understand. They are marketed and pre sold in foreign countries. They’re not the ones lining up.

The people lining up are poor people who think that there is a lack of supply.

#87 Sir James on 06.01.17 at 12:42 am

#83 Nuke

Redundant middle-men are often the last to recognize the new reality as technology advances.

#88 westcdn on 06.01.17 at 12:59 am

I also watch Marilyn Denis. I don’t see she her much because of her timing – but still a woman I respect. She had a special with talented children. It touched me and I can say I will protect them – goes with being a father parent. I watched Ellen the other day. She does make me smile. She doesn’t want children that follow her around – don’t worry, I will take care of that.

One of the funniest scenes I saw was average Andy with the LA Kings. I think she loves him. “You are such an asshole Tanner” sticks in my mind.

https://www.bing.com/videos/search?q=average+joe+ellen+kings&view=detail&mid=4ED398EBBA9A646554D14ED398EBBA9A646554D1&FORM=VIRE

Here is it ain’t me. Nothing new to report on the investment front – I just want cash to buy down my debt.

https://www.youtube.com/watch?v=D5drYkLiLI8

#89 Freedom First on 06.01.17 at 1:26 am

#72 WUL

it’s just personal. Very clever.

#90 Poloz the Terrible on 06.01.17 at 1:38 am

Governor Poloz announced today that he, himself, and his team of specially appointed geniuses have uncovered the mythical backdoor in the Bitcoin protocol planted there by a certain Satoshi, former custodian working for the NSA.

Promptly, Mr. Poloz and one of the geniuses were able to craft a custom miner algorithm which instantly mined for Canada the remaining 5 million bitcoins supposed to be mined slowly throughout this century.

Mr. Poloz refused any comments and did not answer questions about any intentions to buy anything else but CAD, “just because”. He was heard mumbling something unintelligible on his hasty exit from the building. Some reporters think they heard “I’ll be back”.

Reporting for CBC, Peat Onmybridge

#91 Adam on 06.01.17 at 2:38 am

For those about to Flop,

Apologies as I don’t usually have time to read the comments everyday and often have to catch up on blog posts on weekends. Some realtors put out weekly market updates for their area with price changes and sold prices but you need to subscribe. It takes time to search listings and I am wary of posting the information online. I would prefer there was a way for you to track this info yourself. I will think about it and try and get back to you this weekend.

#92 ColintheColin on 06.01.17 at 2:43 am

Hey Flop,

Here’s a bit of the data you asked for the pink reports:

1847 Venables st. Van paid 2.01 ask 2.02:
Listed at 2.48 dropped to 2.29 dropped to 2.22 dropped to 2.02 and just expired today

5830 Alma st. van paid 3.4 ask 3.5:
Listed 4.3 dropped to 4.2 dropped to 3.8 dropped to 3.5 raised to 3.78 sold yesterday at 3.65

2712 Pandora st. Van. Paid 1.29 ask 1.39
Listed 1.58 dropped to 1.39 May 1 raised to 1.52 May 23 and terminated yesterday

3509 Turner st. Van paid 1.4 ask 1.49:
listed 1.59 dropped to 1.54 dropped to 1.49 dropped to 1.44 terminated today

I’ll pop off a few more at some point for you in a few days. If I had more time I’d add the dates – it’s pretty interesting.

#93 Most big condo developments are pre sold to foreign buyers. on 06.01.17 at 5:15 am

Here you go #59 Mark, local Brad Lamb whining:

https://twitter.com/FIVRE604/status/869763113129791488/photo/1

http://vancitycondoguide.com/still-building-still-selling-offshore/

https://twitter.com/FIVRE604/status/869037008730980352/photo/1

http://www.bnn.ca/top-toronto-condo-developer-warns-tax-on-foreign-buyers-could-trigger-recession-1.703067

____________________

A quick, under a minute, sampling.

#94 Victor V on 06.01.17 at 6:48 am

National Bank of Canada is tightening its mortgage standards and is restricting the loans it advances outside of Quebec, a move designed to reduce the lender’s risk profile amid roaring housing markets in some of the country’s biggest cities.

https://beta.theglobeandmail.com/report-on-business/national-bank-hikes-dividend-as-profit-soars-130-per-cent/article35160338

#95 Figure it out on 06.01.17 at 7:24 am

#51 broader mind — “The million dollar question. Who was the OSC working for in the timely hit on Home Capital?”

Maybe Canadian investors generally? A lot of people seem to be missing the point on OSC v. Home Capital.

Home was projecting 20% growth. On the basis of that, investors bid it up to a high multiple. Home had a poor quarter. It had just terminated relationships with brokers who’d done 10% of its business the prior year. An analyst on the earnings call asked about the poor results, and management blamed the weather. That’s lying, folks. Lying when you know people are relying on your lies to make investment decisions, which is a fraud on the markets. When you do that and you’ve already received a sanction from the OSC for lying to investors in an unrelated case, the OSC might not want to make a deal with you (and rightly so!)

People focusing on the mortgage default rate are missing the point. Over at the Financial Post, it’s probably on purpose, because they should know better. Elsewhere, it’s probably just ignorance.

#96 TurnerNation on 06.01.17 at 7:35 am

Yesterday on TSX Element Financial and sister co. ECN Capital had their stock prices drop by up to one-third.
One bounced back the other did not.
Financial and Lending companies.
No news no rumours…yet.

#97 pBrasseur on 06.01.17 at 7:41 am

Canadian banks just make $10 billion in the last 90 days. — Garth

As RE goes so go the Canadian Banks, a pretty solid case can be made to demonstrate that.

Should work on the way down too. If you think RE is a lousy investment right now then the same should apply to Canadian banks.

Their loans are taxpayer-guaranteed with seriously contained risk. There are lots of things to worry about. The banks are not one of them. — Garth

#98 Porsche on 06.01.17 at 7:41 am

#18 Dan.t on 05.31.17 at 6:44 pm

Great post !!

#99 TurnerNation on 06.01.17 at 7:43 am

#2 The First Bilderberger

To understand our elites one must flip everything they say around completely.

(For example did you notice how the actor (Regan’s) wife kicked off the war OF drugs in late 80s: in came crack, meth which ensured private prisons would be full with minorities. This decade it’s even deadlier drugs on the front page. Bad. Breaking.)

Their topics will include:

The key topics for discussion this year include:
The Trump Administration: A regression report
The Trans-Atlantic offence: alliance: bullets, bytes and bucks
The mis-direction of the EU
Can globalisation be sped up?
Reducing Jobs, income and unrealised expectations
The war Of information

#100 crowdedelevatorfartz on 06.01.17 at 8:18 am

@#68 Raging Ranter
“My wife’s friend was over tonight. She said her cousin in Toronto just went halfers with a friend on a place. …”
***********

“Objection your Honour! Heresay evidence! I ask that it be striken from the records!”

“Sustained”

#101 crowdedelevatorfartz on 06.01.17 at 8:22 am

@#58 Leverage
“If you able to connect 2 sentences in your own post you discover you can at least dollars.

You have to try use both the neurons.
*******

Do they teach english grammar on Planet Neuron?

#102 crowdedelevatorfartz on 06.01.17 at 8:27 am

@#34 I’m definitely not Poloz
“do you know that Poloz will decimate the Loonie to 45 …”
******
Are you sure you and Apocalypse2017 arent twins? Or just the same person with mutiple personalities?

#103 yorel on 06.01.17 at 8:39 am

It all reminds me of the old line from the used car lot owner.
“I lose money on every sale, but the volume keeps me going.”

#104 crowdedelevatorfartz on 06.01.17 at 8:40 am

@#27 bill boy
“Did you see how his former colleague Taggart and Killeen were visibly upset when announcing the news ndp/green partnership…”
*******
They weren’t nearly as upset as Chris Gailus at Global tv.
The same Chris Gailus that “finished” a “hard hitting” 3 minute puff ball interview with Christy Clark with,’ Bye Christy talk to you later tonight”…..
Or the time he “interviewed” single mother Christy’s 13 year old son on the 6pm news asking such hard hitting questions as ” Does it bother you that your moms’ famous?” While Clark hovered next to him ready to jump in and take over if he screwed up any answer.
Global tv, with their nose so far up the liberal govts ample derrier they cant see real news for all the paid govt advertising dumped at their doorstep…..
They deserve every percent of their plummeting ratings.

Come to think of it. The kid does look like Gailus…..

#105 Leo Trollstoy on 06.01.17 at 9:02 am

In YVR this week. Nice place. Not sure if live here. Too cloudy rainy. Nice restos tho. Amazing views.

#106 pBrasseur on 06.01.17 at 9:05 am

There are lots of things to worry about. The banks are not one of them. — Garth

Not a systemic risk probably, as you point out banks are backstopped by taxpayers (pity us…), but that doesn’t mean they are a good investment. And since banks make up such a large part of the economy you should expect strong «side winds»!

Better still, don’t buy individual equities. An all-in TSX ETF is the best choice. — Garth

#107 Penny Henny on 06.01.17 at 9:24 am

96 TurnerNation on 06.01.17 at 7:35 am
Yesterday on TSX Element Financial and sister co. ECN Capital had their stock prices drop by up to one-third.
One bounced back the other did not.
Financial and Lending companies.
No news no rumours…yet.

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

http://business.financialpost.com/news/fp-street/element-fleet-says-unaware-of-reason-as-stock-plunges-38

It was a mistake, but underscores investor nervousness and reinforces the danger of holding individual equities. — Garth

#108 Ace Goodheart on 06.01.17 at 9:42 am

Re: #96 TurnerNation on 06.01.17 at 7:35 am
Yesterday on TSX Element Financial and sister co. ECN Capital had their stock prices drop by up to one-third.
One bounced back the other did not.
Financial and Lending companies.
No news no rumours…yet.

-US short seller Muddy Waters tweeted it had identified a new Canadian candidate for shorting, but did not give the name. People mistakenly believed it was ECN and its sister firm Element Financial. Shares plunged. It was then revealed that the target was Vancouver based Asanko Gold.

Both Element and ECN now look like screaming buys, particularly Element, which has not fully recovered.

#109 LS in Arbutus on 06.01.17 at 9:59 am

Flop, thanks for your homework. It certainly shows that the market is NOT on fire. Even for those sold above what someone paid, when you add in property transfer tax, closing costs, reno costs and realtor costs they’ve probably made NO money. And when you’re on the hook for $2 – $3 million PLUS… that’s a pretty big risk to take.

I am simply surprised the market’s limped along as well as it has… maybe this is the melt that Garth speaks of.

I don’t see it continuing at a melt pace when inventory increases (which is inevitable) or when China implodes (inevitable) or when interest rates increase (inevitable) or when the new government introduces new anti housing measures (inevitable and long overdue.)

And then you add in all the news on sub-prime, HCG, difficulty for people to get mortgages…

And finally and a HUGE factor in the Vancouver market is that many, in my mind, have been using their homes as ATMs.. as prices decrease and they have no more access to funds from said HELOC… this is when the real sh*t hits the fan.

#110 maxx on 06.01.17 at 10:08 am

#21 espressobob on 05.31.17 at 6:51 pm

“Like DIY investing isn’t hard enough? Risk is real. Quality counts, always has. Hell could be waiting on the other side otherwise.

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

Hell always waits on the other side of malinvestment – separated only by the thinnest of membranes, composed of whatever legislation is in place – whether or not that legislation has actual teeth.

People will always get sucked in and many do lose their life’s savings, having ignored caution to get “the rate”.

Much of the time, this happens mainly out of need rather than greed, further accelerating the deterioration of the social fabric during crappy economic times.

And those times are about to get worse. Sometimes being on the sidelines sucks. At other times, it rocks…..I feel that I like my current perch very much indeed.

#111 Capt. Serious on 06.01.17 at 10:33 am

I was talking with my boomer retired parents last night. They live in a nice-ish neighbourhood near the lake and Rouge river, on the right side of the 416 divide. Houses were selling in their area most of last fall and through the winter within a couple of weeks, usually over asking. Now houses are sitting and not selling. Things have changed. Price adjustments may be coming.

#112 Rob Fortyyy on 06.01.17 at 10:40 am

My real estate lawyer told me yesterday that every third client she sees has either all or some of their mortgage coming from a private lender at around 10% interest.

Since the turmoil with HCG that number has increased.

Her Yonge and Steeles office is certainly in close proximity to some Jewelry and Falafel shops.

Spot on Garth!

#113 Stan Broock on 06.01.17 at 10:44 am

#6 dave on 05.31.17 at 5:51 pm
$400Billion sub prime. is this your attempt at fake news, Garth? Seriously overstated. the MICs and true alternative book for the monolines is less than 5% of the market, and Ben T and BoC would all agree to that. can’t include the First Nationals etc – unregulated, yes, but as prime as prime can get. unregulated doesn’t mean sub prime in Canada. waaaaaaay off the mark.

Not according to Home Capital documents. It estimates between one-quarter and one-third of the $1.2 trillion mortgage market is subprime. — Garth

————————
According to a recent survey 75 % percent of mortgage holders in Canada can not handle 10 % increase in their monthly payments.

All these are subprime mortgages.
It represents 900 billions in subprime mortgages.

The worse part is that the majority of those ultra-subprime mortgages are not mortgages originated in the last year at the current top (33 % Y/Y increase) at 1.5 million SFH in GTA but mortgages from 4-5 years back, that are subprime even at prices of 800 k.

scary stuff.

#114 Shawn Allen on 06.01.17 at 10:46 am

Gold money for 5000 years?

#66 Keith in Calgary on 05.31.17 at 10:16 pm said:

Gold has been around 5000+ years………can’t say that for any other form of money.

***************************************
There are a LOT of things that really have only been around for a few hundred years at most.

These include the current monetary and banking system

Also things like decent life expectancy. A comfortable standard of living for most people. Vast leisure time. Many years in retirement. Travel for the masses. Freedom from war for most of the world.

There is just no comparison to the standard of living today compared to 200 years ago. Things are also vastly better than they were 50 years ago for most people. Only those over about age 55 can attest to this from personal experience.

Our current monetary system plays no small part in creating today’s standard of living.

While there is much to learn from history, the notion that gold will return as a valid currency is not likely one of them.

Bitcoin? Let’s see. It’s totally open and also totally private. Really? It will have no central authority? Dream on. Blockchain has a future but it is no panacea. Bitcoin is just a fringe thing.

#115 For those about to flop... on 06.01.17 at 11:36 am

38 am
For those about to Flop,

Apologies as I don’t usually have time to read the comments everyday and often have to catch up on blog posts on weekends. Some realtors put out weekly market updates for their area with price changes and sold prices but you need to subscribe. It takes time to search listings and I am wary of posting the information online. I would prefer there was a way for you to track this info yourself. I will think about it and try and get back to you this weekend.

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

Hey Adam , thanks for getting back to me.

I want you to know that even if you help me just the one time like you already have, that I am grateful for your effort.

I don’t want anyone to do anything that they don’t feel comfortable with.

When I first started noticing people losing money or breaking even before renovation costs my plan was to just wait until the information was updated into bc assessment and then show everyone the results.

The problem with this is it can take a long time and there was a lot of people on here that didn’t believe me.

Here we are in June and some of my cases from January and February still haven’t been updated.

Once a person on here told me of three houses that they wanted to know the price of the sales from last year and they as well have not been updated and so it does not seem very consistent.

I am a blue collar bum with some time on his hands and so in that spirit I will do the dirty work and if someone wants to finish the puzzle off it is o.k by me.

As I once said to Broadway when he asked me why I don’t just call a realtor,I like the fact that someone on here verifys what I am doing in front of anyone and it’s not really about who is wrong or who is right.

Nor is it about being a winner or a loser , as the real winners are anyone who has been smart enough to cash in and live in an appropriate piece of property for them instead of being owned by the bank…

M42BC

#116 Crypto on 06.01.17 at 11:44 am

#85 Sir James on 06.01.17 at 12:19 am

[b]Bitcoin has about 30 million global users, about the size of Canada. Whats the ‘market cap’ of the Canadian Dollar?[/b]

Well good sir knight, which of those has the room for growth then? CAD is not going to grow its userbase.

Moreover, CAD can be created, and is created, every minute when banks create loans. Compare this with bitcoin which has a hard limit on the supply (even dwindling).
It is bitcoin’s fate to become scarcer and scarcer as wallets are lost.

Where should you store your wealth? In something that is rapidly created (TO condo, diamonds, Canadian Dollar) or something that is doomed to ever increasing scarcity?

#117 For those about to flop... on 06.01.17 at 11:47 am

Hey Colin ,thanks for the help.

The message that I sent to Adam applies to you as well.

I am grateful and only do what you feel comfortable with.

I see the one you were able to help me with had the same result as a lot of my cases ,walking away basically with not much after expenses but able to fight another day.

Probably should thank LS in Arbutus for their encouragement and Freedom I’ve been meaning to thank you as well.

My Pink Pollen posts aren’t for everyone,I try to do a bit of colour commentary for one each one and try to personalize the case to stop from putting everyone to sleep , but luckily I have a good teacher in the boss of this blog to basically write the similar things over and over but never write the same thing twice.

I leave the plagiarizing up to other people on this blog…

M42BC

#118 InvestorsFriend on 06.01.17 at 12:08 pm

Be the Bank?

What if you could start your own bank? Banking is traditionally quite lucrative. It would be nice, no?

Unfortunately it is obviously not reasonably possible to start your own bank.

But you don’t need to. The market today is allowing you the rare chance to buy into certain banks at about book value. Canadian Western Bank is trading barely above book value. Some very smart and quite wealthy people started this bank about 30 years ago.

It has sometimes traded at over twice book value. Most profitable businesses trade at well over book value because why should new people get in at the same relative value as the founders after the thing is already successful?

Banks indeed can be risky and occasionally can trade at or below book value. But that is relatively rare. There are no guarantees but that is usually a great buying opportunity.

Individual stocks can be risky and not everyone should go that route. But if you like to buy individual stocks, Canadian Western might be worth considering.

Disclosure. I own it. Question my motives if you wish but I just think buying this bank at near book value will work out well. I seriously doubt that any buying my post generates will push up the price. In any case I will not be selling any shares in the foreseeable future.

Again the ability to buy a Canadian bank that appears to be solid at around book value is a rare chance.

Home Capital is well below book but that is a vastly different situation. FAR more speculative.

Invest in anything at your own risk. Most people should use an advisor.

#119 pBrasseur on 06.01.17 at 12:10 pm

Better still, don’t buy individual equities. An all-in TSX ETF is the best choice. — Garth

I believe Canadian banks are a lousy investment no matter if it’s directly or through an ETF

#120 Doug in London on 06.01.17 at 12:47 pm

After reading about these MICs I’m amazed so many geniuses have said Canada doesn’t have subprime mortgages like those in the United States years ago. Why would anyone buy into such a thing when there are better investments out there? Speaking of which, has anyone noticed that ENB, IPL, and XEG have been on sale recently?

#121 Simplyput7 on 06.01.17 at 12:48 pm

Now appraisers (and lenders) are more concerned with values of homes.

Best part of article:

It wouldn’t be the first time, appraisals have lagged purchases prices — a phenomenon that previously caught some Vancouver buyers by surprise when it was time to close.

A lower appraisal could increasingly be an issue for people with previous deals, not yet closed, in Toronto, especially when buyers are coming up with only the minimum 20 per cent down payment for a non-government backed loan.

If you buy a home for $1 million with $200,000 down, you need a $800,000 loan to close. But if your appraisal comes in at $900,000, your financial institution will only agree to a maximum $720,000 loan based on 80 per cent debt to 20 per cent equity. Those buyers are left searching for a second mortgage — at a higher rate — to get the extra $80,000 if they can find someone to loan them the money.

“We are seeing some people walk away from deals,” said Polito, because they can’t close — a move that comes with a myriad of problems if the sellers seeks legal damages. “What are seeing is properties sold in January and February, values are still there but if it sold in March, it is very hard to support the value.” Toronto prices rose 33 per cent in March from a year earlier.

http://business.financialpost.com/personal-finance/mortgages-real-estate/real-estate-market-uncertainty-is-forcing-appraisers-to-take-a-second-look

You mean the bidding wars in Toronto and Vancouver don’t reflect the true value of home? How could that be?

Also, I like the part in the article, where they mention lenders not banks are giving loans to these people.

The next several months should be interesting.

#122 n1tro on 06.01.17 at 12:57 pm

@post#71

“What makes you believe there exists a conspiracy to keep cryptocurrencies down? You see nothing wrong with a “currency” who value changes quickly on a weekly basis?”

The fact that governments are scrambling to understand it and put regulations on it. If a cryptocurrency has no value and swings wildly, governments just need to wait for it to implode and go down to zero. The reason why their is hate for bitcoin is that it works independently and outside of the SWIFT network which is controlled by central banks and have been used in the past to punish people/nations not falling in line by restricting access to it.

“Which bank allows deposits/withdrawals in Bitcoins? Any bank accept Bitcoins to securitize a loan?”

No bank allows deposits of bitcoins or precious metals for that matter. It has to be converted to paper money which Bitcoin and precious metals can be.

“Hell, even precious (Au, Ag, Pt, Pd) coins and bullion can be used for the above purposes.”

Wrong.

“Compare the purchasing freedom C$3000 cash has versus a Bitcoin … Which one gives you more freedom?”

The freedom that is being referred to here is being able to transfer money anywhere without the fees or regulations. Cash is great but try carrying more than $10K across the border and see if you don’t get harassed.

“If you are afraid of the government spying on your purchases and want freedom offline, just use hard cash; it’s still legal tender.”

Pablo Escobar had a ton of hard cash. After a certain point, it did him no good so he had to bury it and sometimes burn it.

Bottom line is that governments will put a negative spin on cryptocurrencies because they can’t track it yet. They’ll tell you it is being used for evil things like buying drugs and kiddie porn. This narrative will stop when central banks coordinate and make or back their own cryptocurrency and it will be considered the next best thing to sliced bread.

#123 maxx on 06.01.17 at 1:00 pm

#25 GDP up…some good news on 05.31.17 at 7:01 pm

“March GDP +0.5%.

Manufacturing, retail and wholes sale trade and oil and gas the big contributors.

If RE et. al. begins to unravel, maybe the rest of the economy can offset it, well, in March at least.

Probably thanks to our “dollarette”.

If nothing else, some good news.”

Not so fast……debt is keeping up the pace. As usual. This msm gem has its opponents, stating that much of it has to do with re in bubble areas.
At any rate, the real economy continues to suck way more than it blows and the end of summer will see increased sucking momentum, à la Trump with re values dropping as listings continue to swell.
We’ll be quite entertained when tptb return from fun in the sun, armed with imaginary strategies, canned speeches and prepared sound bites. Those Blackberries will be smoking!

#124 Ole Doberman on 06.01.17 at 1:06 pm

Looks like Starbucks serving alcohol in Vancouver – good homeowners are going to need it over the next 3 years:

http://www.bnn.ca/starbucks-to-serve-alcohol-in-vancouver-in-push-to-attract-evening-customers-1.767058

#125 Pete on 06.01.17 at 1:12 pm

#66 Keith in Calgary on 05.31.17 at 10:16 pm said:

Gold has been around 5000+ years………can’t say that for any other form of money.

So what? Horses have been around for 5000+ year for transportation. Are you going to ride horses instead of driving a car?

#126 InvestorsFriend on 06.01.17 at 1:16 pm

RESP WITHDRAWAL optimization

If you have a large RESP account with lots of gains it is tricky to know how much to take out in a year to try to get it out tax free.

In 2016 I took a large amount. My kid’s income tax was still zero but it reduced the $5000 max tuition transfer to me down to about $2500. This means I lost a $2500 deduction on my own tax return. In effect this RESP withdrawal in the kid’s name increased my taxes. Probably at a marginal tax rate well over 30% on that lost $2500 deduction.

Also my kid appears to have lost some mysterious “other credits” that would have applied if his income was not boosted by RESP. The total marginal tax impact of an RESP withdrawal is not easy to estimate.

Well, the RESP money had to come out some time… If you get large gains it likely leads to some tax being paid and o tax credits lost. But there are worse things than paying taxes on gains. Like no gains.

#127 InvestorsFriend on 06.01.17 at 1:18 pm

About Gold and horses and obsolescence

Pete at 122, excellent response! (a knock-out punch)

#128 bdwy sktrn on 06.01.17 at 1:19 pm

east van (north of 16th or so) sfh sales report – last couple of weeks

still slowish, but just price it right and it’s gone in a week.

on a handful of sales;

‘character’ houses (ie 100yo uninsulated maybe still knob and tube)
2 sold 1.7(100k over ask) and 1.8 (200k over, renoed)

van special 1 sold – ask 1.7 sell 1.6

weird but new reno bung 1.75 at ask

2 lot value – around 1.4 (further east than the 2 same for sale at 1.99 close to the drive)

and one , more interestingly, in cedar cottage, like halfway over to flop’s pink pointers headquarters just went way over ask for a 25′ (smaller) lot
1218 E 14TH AVENUE $1,498,000 $1,675,000

#129 jess on 06.01.17 at 1:23 pm

Bill Black: Lenders’ Lies about Liar’s Loans and “Rigorous Underwriting”

…”The definition of a liar’s loan is that it is designed for the purpose of avoiding not simply “rigorous” underwriting, but rather the most minimal underwriting any property lender must do to have any chance of surviving. Yes, “rigorous underwriting” is the absolute essential to managing risk in property lending. Yes, in the case of conventional home lending, rigorous underwriting can reduce credit risk to tiny proportions. One of the “Four C’s” of minimally competent underwriting for such loans is “Capacity.” That means that the lender, must at a minimum, verify that the borrower has adequate income to repay the home loan.

The definition of liar’s loan is that the lender does not verify the borrower’s income (and more extreme liar’s loans do not verify the borrower’s job or assets). The CEO causes the lender to make liar’s loans for the purpose of inflating the borrower’s reported income, which makes it possible for the lender to make more and larger loans, which enriches the CEO.

The failure to verify the borrower’s income produces massive fraud and what economists call “adverse selection.” As a result, at the time the loans are made, they represent in economic reality a loss. The loans have a “negative expected value” at the time they are made. This exemplifies the great truth that the WSJ cannot seem to comprehend – underwriting appears to the ignorant to be a cost center for a home lender, but it is actually an honest bank’s most important profit center. Proper GAAP accounting would require the lenders making liar’s loans to report at the time they made the loans that they produced a net loss, but one key to the frauds is for the lender’s controlling officer to set aside only pathetically inadequate “allowances for loan and lease losses” (ALLL). The officers that control the lender know that the fraud “recipe” produces three “sure things.” The lender will promptly report record profits, the officers will be made wealthy through modern executive compensation, and the lender will ultimately suffer catastrophic losses.

========

FOR IMMEDIATE RELEASE
Friday, September 30, 2016
Chief Executive Officer of Pharmaceutical Company Charged in $100 Million Fraud Scheme

Scheme Caused the Collapse and Failure of One of Puerto Rico’s Largest Banks

The former chairman and CEO of a multinational pharmaceutical company was charged in an indictment unsealed today in connection with a fraud scheme that caused over $100 million in losses and led to the collapse and failure of Westernbank Puerto Rico (Westernbank), once one of Puerto Rico’s largest bank”

The indictment alleges that Kachkar caused false and fraudulent customer invoices to be submitted as collateral for loans from Westernbank; made false and fraudulent representations to Westernbank executives about purported imminent repayments of the Inyx loans and the value of assets he pledged as a guarantee for these loans; and misappropriated and embezzled the fraud proceeds for his personal use and benefit. During the course of the scheme, Kachkar allegedly misappropriated approximately $25 million in fraudulent proceeds to his personal bank accounts and also misappropriated an additional $9.6 million in fraudulent proceeds to a bank account in the name of his associate. Kachkar also allegedly used the proceeds from the scheme to pay for, among other things, multiple high-end real estate properties in Miami, luxury vehicles and a private jet.

https://www.justice.gov/usao-sdfl/pr/chief-executive-officer-pharmaceutical-company-charged-100-million-fraud-scheme

#130 IHCTD9 on 06.01.17 at 1:26 pm

#109 LS in Arbutus on 06.01.17 at 9:59 am

And finally and a HUGE factor in the Vancouver market is that many, in my mind, have been using their homes as ATMs.. as prices decrease and they have no more access to funds from said HELOC… this is when the real sh*t hits the fan.
_____________________________________

This is popular all over – even in the hinterland among more affluent couples. Let’s put it on the mortgage. New camping trailer and a big-ass 4×4 Quad Cab F350 to pull it. New garage, let’s pave the driveway too. I know two guys who racked up an unbelievable pile of sheer consumer spending which was nonchalantly added to the monthly mortgage bill. One guy apparently had to agree to an increased interest rate – not just on the HELOC spending, but on the current mortgage principal as well.

It all looks so picture perfect when peering out the window, but their financial future has now been firmly rooted behind the black gates. The eye atop Barad-dûr appraises their solvency, and lightly stays the Uruk-hai…

#131 RP on 06.01.17 at 1:27 pm

When the pro RE Globe and Mail publishes an article like this it is a good idea to pay attention. The title of the article is misleading and benign… But it is what is written within that is telling:

https://beta.theglobeandmail.com/real-estate/toronto/torontos-unpredictable-housing-market-stokes-anxiety/article35164710/?ref=https://www.theglobeandmail.com&service=mobile

#132 TurnerNation on 06.01.17 at 1:29 pm

What’s rallying in Canada: Gold, Weed, Dollarama stock.

All we got bro.

#133 n1tro on 06.01.17 at 1:43 pm

@Pete and horses being around +5000 yrs.

Illogical counter to what is being argued. The premise of what Keith is saying is that gold is something physical which has traditionally associated with a certain value and has been used in commerce. Keith implies that if paper based system implode that gold could again be used since it has history on its side.

Your dismissive argument of using horses now since we have modern technologies like cars and planes makes no sense because one could argue that if oil is depleted and there are no more cars, then YES, people could go back to horses as a mode of transportation.

Paper money isn’t going away. It’s value however will eventually go down to nothing as shown by all currencies in history. The important thing to think about is what you can use the money for once you accumulate enough of it.

#134 For those about to flop... on 06.01.17 at 2:02 pm

Pink Pollen falling in Vancouver.

Well ,for those paying attention this is the third or fourth house that I have found in trouble in the questionably named Turner Street of Vancouver.

Of course this street was destined to be featured in a Vancouver real estate correction , but just as one of their neighbours gave up its these guy’s turn to try to escape.

They forked out 1.4 in April 2016 which is mainly land value and after attempting to make a profit they have lowered it down to the assessment number and their buy price to see if they can walk away with nothing but a few bitten fingernails.

I am still lobbying the local council for a Flop Street…

M42BC

3509 Turner Street, Vancouver

Mar 10:$1,599,000
May 31: $1,399,000
Change: – 200000.00 -13%

https://www.zolo.ca/index.php?sarea=3509%20Turner%20Street,%20Vancouver&filter=1

https://evaluebc.bcassessment.ca/property.aspx?_oa=QTAwMDAwMlJVVw==

#135 Bose on 06.01.17 at 2:04 pm

@Retired DND, post #5

BMO’s ZID (India Equity Index) etf , solid blue-chip companies.

#136 Long-Time Lurker on 06.01.17 at 2:21 pm

I got a name wrong. It’s James Rickards not Jim Rickertts.

An interesting bit on BitCoin. Did someone post this already?

http://themacrotourist.com/macro/my-great-bitcoin-bungle

#137 bdwy sktrn on 06.01.17 at 2:21 pm

and flop, no data on venables turner or pandora

#138 The Technical Analyst, CSTA, CPD on 06.01.17 at 2:23 pm

@#122 n1tro on 06.01.17 at 12:57 pm
@post#71

N1tro, I see where you are going with this. Heck, I listen to Alex Jones myself sometimes.

But Bitcoin is speculative cryptocurrency. It may have “early block chain” technology, but as post#71 said: “You see nothing wrong with a “currency” who value changes quickly on a weekly basis?”

It’s unstable, highly speculative, BTC can be created out of thin air, hell, it’s more fiat than currency is. (you can mine it with your computer).

If you think it isn’t used for illegal goods/uses, you need to look at WHO is trading it. 95% of BTC trades originate from China to get around Cap Controls. Is that a “currency” you want to put your savings in?

BTC (itself) isn’t the future, it is a speculation. It’s fools gold.

This coming from (I think) the only one here who trades FORex on the global market.

#139 Where's The Money Guido? on 06.01.17 at 2:32 pm

Re:#118 InvestorsFriend on 06.01.17 at 12:08 pm
Unfortunately it is obviously not reasonably possible to start your own bank.

But you don’t need to. The market today is allowing you the rare chance to buy into certain banks at about book value. Canadian Western Bank is trading barely above book value. Some very smart and quite wealthy people started this bank about 30 years ago.

Maybe the reason CWB’s trading at book value is because they hold a bunch of Alberta mortgages that are about to go under and they’re trying to suck in anyone who thinks this is a good deal—at book value.
I’d be surprised that it doesn’t go under in the next year or so from all that bad paper.

#140 Fake News on 06.01.17 at 2:42 pm

The Fake News on the radio is going crazy today in Vancouver the words “Global Warming (not climate change), Russian Hackers and James Comey are being repeated every 30 minutes.

Desperate MSM?

#141 For those about to flop... on 06.01.17 at 2:49 pm

CONFIRMED PINK SNOW.

This is the first time I have come across this house but it looks like it did not go to plan for someone.

This house is back on the market for 1.6m even though it is only assessed at 935k but the reason you should check out the link is because someone panicked and sold it before things exploded out there in 2016 and they took a small loss as far back as June 2015.

Broadway,you remind me of an old girlfriend….only want to talk to me when you see me talking to other people…

M42BC

Paid 550k March 2015

Sold 552k June 2015

https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDA3N1ZXOA==

#142 Victor V on 06.01.17 at 2:51 pm

http://www.financialpost.com/m/wp/news/blog.html?b=business.financialpost.com/personal-finance/mortgages-real-estate/real-estate-market-uncertainty-is-forcing-appraisers-to-take-a-second-look&pubdate=2017-06-01

Claudio Polito, a Toronto appraiser and principal owner of Cross-town Appraisal Ltd., says lenders basing mortgage decisions on value, as opposed to income and credit history, are really trying to stay on top of a market that appears to be changing rapidly.

By his estimates, prices in the Greater Toronto Area have dropped anywhere from five per cent to 15 per cent over the last 30 days. The next set of statistics from the Toronto Real Estate Board are due out Monday and will mark the first full month of data since provincial changes to cool the market that included a tax on foreign buyers.

#143 n1tro on 06.01.17 at 2:56 pm

@The Technical Analyst, CSTA, CPD

I have no idea who Alex Jones is.
As a currency, if BTC swings around a lot, that is all good for those who want to take the risk of holding it. Same with any paper currency with an unstable government/central bank backing it.

BTC can not be created out of “thin air”. You have this confused with paper money.

Bitcoins needs to be “mined” by using dedicated ASIC machines that decrypts a complex formula. As the formula is solved, a bitcoin is spat out but it gets harder and harder. This is why you can’t use your typical computer to mine it anymore. The point of this by the creator is to simulate a finite commodity which gets scarcer when extracted.

As BTC’s uses and legality….is paper money or any other forms of value eg. blood diamonds innocent in the deaths and suffering of mankind??? No? So we should stop using all cash, diamonds, gold, etc because they are root of all evil?

BTC may not be the future but its concept is. The concept being that it is digital (mobility) and finite (I believe there is only 21 million bitcoins available to be mined) while getting harder and harder to find, so it can’t be inflated away like cash by a central bank.

I am not advocating anyone put any savings into BTC or currency for that matter. Put your savings into vehicles that out paces the devaluation of the medium itself and convert it to something useful.

BTW. I trade forex too.

#144 For those about to flop... on 06.01.17 at 3:07 pm

Pink Pollen falling in Surrey.

These guys were dreaming for a while but have now priced this house to get some interest and get on with their lives.

They are into it 860k that they signed on for in April 2016.

The assessment doesn’t cover this number and as a lot of people out in Surrey seem destined to find out is that at some stage you will be able to get a better deal in town after time and expenses are factored in and will only live out that way of your choosing…

M42BC

8963 Crichton Drive, Surrey

May 11:$1,049,800
May 31: $799,000
Change: – 250800.00 -24%

https://www.zolo.ca/index.php?sarea=8963%20Crichton%20Drive,%20Surrey&filter=1

https://evaluebc.bcassessment.ca/Property.aspx?_oa=QTAwMDA3ODdKRA==

#145 n1tro on 06.01.17 at 3:40 pm

As for the forex traders here, from my reading of posts, it would be

you, me, traderJim, and SmokingMan

#146 MF on 06.01.17 at 3:43 pm

#131 RP on 06.01.17 at 1:27 pm

Thank you for that article. Interesting.

Here one RE shill admits it:

“The new listings number may stay elevated as agents continue to have trouble reading how buyers want the pricing to be while also being fearful of listings looking “stale.” The number could also remain elevated because owners believe that there is a flood of new listings out there and they should jump aboard the bandwagon in order to cash in on high prices.”

Then another tries the usual spin:

“the market will settle into a more balanced phase with prices appreciating by five to seven per cent annually.”

Interesting indeed.

MF

#147 MF on 06.01.17 at 3:51 pm

Lol these guys are so pathetic.

“balanced market” with a 5% increase every year?

How about the fact that houses have been increasing in an unsustainable rate for 15 years?

How about when we remove the thousands of speculators, “demand” will drop like a rock?

How about when we have a competent BoC and interest rates are not artificially manipulated, prices will fall in proportion to the rise in rates?

How about we get rid of the CMHC (useless institution)?

The GTA market is an absolute joke.

MF

#148 Johnny Boy on 06.01.17 at 4:10 pm

#133 n1tro on 06.01.17 at 1:43 pm

@Pete and horses being around +5000 yrs.

Illogical counter to what is being argued. The premise of what Keith is saying is that gold is something physical which has traditionally associated with a certain value and has been used in commerce. Keith implies that if paper based system implode that gold could again be used since it has history on its side.
Your dismissive argument of using horses now since we have modern technologies like cars and planes makes no sense because one could argue that if oil is depleted and there are no more cars, then YES, people could go back to horses as a mode of transportation.
Paper money isn’t going away. It’s value however will eventually go down to nothing as shown by all currencies in history. The important thing to think about is what you can use the money for once you accumulate enough of it.
………………………………………………………………….
My brother is hoarding away all kinds of stuff for the great apocalypse. He owns property and a rather nice home North of where I am by about 160 km. Our Nona lives there with him and his family. He has a 15 hectare woodlot, one stream, one pond and yes he has two horses. He works for himself out of the home and commutes to see his customers when he is needed. He can do that as he is one of those IT programmer gurus. When I talked to him last weekend he said one day Bitcoins and paper money will be worthless. He said with a couple of keystrokes he can make Bitcoins dissappear or reappear. He said paper money is coming to its end soon. So my question was what is valued then. He said gold and land, but gold very impracticable to move around. Then he said sadly the most valuable item in the future is going to be lead. He had a serious look on his face when he told me that. I didn’t tell our Nona as she have a fit.

#149 MF on 06.01.17 at 4:11 pm

#114 Shawn Allen on 06.01.17 at 10:46 am

Great response. No question the standard of living is higher now than it was 50-60 years ago. All anyone has to do is read some history to find out what life was like pre-World War 2 to get a glimpse.

I guess the big question is whether my standard of living in 2017 is better than my the one enjoyed by my boomer parents?

BTW,

Trump announces U.S. will withdraw from Paris climate accord.

MF

#150 Johnny Boy on 06.01.17 at 4:17 pm

Trump pulls out of the Paris agreement. Wow it’s unheard of for 195 nations to agree on anything. Trump is obviously smarter than anybody else? Good luck with that Fat Boy when Mar-a-Lago is under water.

#151 Keith in Calgary on 06.01.17 at 4:22 pm

Just watched Trump’s speech taking the US out of the globalist third world wealth distribution scam.

I could hear millions of snow flakes heads exploding during his direct and blunt rebuke “Pittsburgh, not Paris”………as well as directly mentioning that crime against humanity that is called globalism by the tyrannical leftist elites.

I love this man. Gonna buy a MAGA hat the next chance I get.

#152 broader mind on 06.01.17 at 4:25 pm

#95 Figure it out — I smell coffee,do you. More disgruntled employees from the big banks getting media time again today. Poor things had performance targets to meet.

#153 NoName on 06.01.17 at 4:25 pm

@flop

From yesterday, that gray thing why we no use, probably because only gray thing that i know of is couple of streets over, and its street name where younger ons school is.

#154 bill boy on 06.01.17 at 4:38 pm

@ #104 crowdedelevatorfartz

You’re right. The son looks more like Chris than Mark Marissen.

Also, have you looked into the connection between the BC Hydro head and the crowned premier in 2001?

#155 People are Strange on 06.01.17 at 4:50 pm

A MUST READ:

https://www.google.ca/amp/business.financialpost.com/personal-finance/mortgages-real-estate/real-estate-market-uncertainty-is-forcing-appraisers-to-take-a-second-look/amp

#156 Torontorocks on 06.01.17 at 5:30 pm

Garth – saw you walking the hallowed halls of Scotia plaza today, head down, muttering to yourself, like the weight of the world was on your shoulders.

I still owe you a coffee.

Be cool.

#157 jess on 06.01.17 at 5:41 pm

monte dei paschi italy

https://euobserver.com/economic/138093

========

https://commercialobserver.com/2013/02/deutsche-banks-rosemary-vrablic-and-private-bankings-link-to-cre-finance/

The Russian-Israeli Billionaires Embroiled in Israel’s Latest Corruption Investigation

Worth some $3 billion, ex-con, ex-pediatrician Michael Mirilashvili and his son Yitzhak are two of 14 suspects detained for questioning in the probe of Minister Arye Dery
read more: http://www.haaretz.com/israel-news/1.792710

http://www.haaretz.com/israel-news/business/the-perfect-banker-who-made-the-people-loathe-bank-leumi.premium-1.516681

=================
Israel’s Attorney-General Yehuda Weinstein has formed a task force to look into the Bank Leumi affair. Bank Leumi, Israel’s second largest bank, recently came to a settlement with the United Stated requiring it to pay $400 million to settle two separate investigations into whether it helped its U.S. clients evade taxes.

The criminal investigations conducted by the United States Department of Justice revealed that from at least 2000 until early 2011, Leumi sent private bankers from Israel and elsewhere to meet with US taxpayers and help them conceal assets at Leumi locations in Israel, Switzerland and Luxembourg. Leumi, a unit of Bank Leumi, also helped US taxpayers prepare and present false tax returns, prosecutors said.

https://www.justice.gov/opa/pr/bank-leumi-admits-assisting-us-taxpayers-hiding-assets-offshore-bank-accounts

#158 Smoking Man on 06.01.17 at 6:04 pm

#150 Johnny Boy on 06.01.17 at 4:17 pm
Trump pulls out of the Paris agreement. Wow it’s unheard of for 195 nations to agree on anything. Trump is obviously smarter than anybody else? Good luck with that Fat Boy when Mar-a-Lago is under water.
…..

Ha ha. Boom. Global Communism on the mat for the first time. Other nations will follow. Once T2 is shown the door. Can under conservative govt will pull out too.

#159 A Reply to #151 Keith in Calgary on 06.01.17 at 6:10 pm

“I could hear millions of snow flakes heads exploding during [Trump’s] direct and blunt rebuke….”

Elon Musk was one of them. He’s stepping down from all the councils to which Trump appointed him. (Or, as Trump spells the word, councels.)

#160 Dave on 06.01.17 at 7:04 pm

Is an IMF warning all that big of a deal? Banks are insured, CMHC says they have enough to cover failure. I know it’ll be crappy for the Canadian economy, and houses would lose value, but it doesn’t seem like winter is coming.

Am I wrong? Trying to balance the doom and gloom all of you anti-real estate blogs are handing out with the overly optimistic government.