The tightening

Yeah, it’s not Bitcoin. But a balanced, low-vol, diversified, 60/40 portfolio has handed investors close to 10% this year. And it was 8.5% last year. The even better news is that there’s more of the same coming, it seems.

The reasons are simple. Don’t overthink them.

Growth is back: the global economy expanded around 3% in 2017, which was a helluva lot better than the 0% of a few years ago. This is expected to explode to 4%, which is the best in half a decade. If it happens, the two-year spurt will top anything since before the credit crisis. Remember all those negative-rate bonds the geniuses in the steerage section said were coming to North America? How CIBC would soon pay you to have a mortgage, instead of the other way around? Phooey. Deflation is inflation, and we’re not going back.

It’s the jobs, stupid: labour stats, month after month, have shown business confidence as employers hire up a relative storm. Unemployment in the US has turned into technical full employment, and in Canada we have the best record going in eight years. Corporations are spending more, making more and expanding as they have not since 2007. Profits have been rising by double-digits – which is exactly why stock markets around the world are bouncing around at record levels.

Trump: Love him or hate him, the election of this wingnut signaled the end of the deflationary post-crisis years and the start of a new era of cowboy capitalism. The tax cut ushered in a week ago is monumental. After all, there is absolutely no reason to slash American corporate tax rates by a third, but that’s exactly what’s about to happen. If you thought the Dow was at nosebleed level, you’ll be awed at what lies ahead. Will there be some corrections along the way? You bet. Ignore them.

Lower taxes, higher profits, rising markets, expanding global growth plus robust spending by more people with jobs will have predictable results. A big win for investors. Higher consumer prices and more inflation. Wage pressure. Inflation. Higher interest rates. Lower house prices.

There’s a 98% chance the US Fed will raise its key rate on Wednesday. That will be the fourth time in 12 months, with three or four more increases to come in 2018. That will total seven or eight moves, raising the Fed rate by a full 2%, in about 24 months. In Canada we’ve had two hikes in 2017 and most economists figure three (or at least two) in 2018. The prime rate next Christmas will be 3.7% and over $280 billion in variable-rate HELOCs will have jumped to around 4.5%.

There will also be higher interest rates in Britain and eventually in Europe. The next Fed boss, Jerome Powell, is expected to lead a coordinated global rate bloat to deal with the inflationary growth spurt and pent-up demand now so evident in these Trumpian times. Fatter economies also mean debt gets less scary, watered down and easier to ignore so eventually we’ll be rid of all those dour guys who say the world economy is heading for a cliff. It’s not.

None of this precludes the possibility of shocks, like a terrorist attack or extreme weather events, or even a recession in the US within the next three years. But market corrections and economic contractions within an overall bullish period are piffles. The only people who suffer are the ones who watch BNN every morning or read blogs by advisors selling fear, then bail when they should be buying.

As for houses, more jobs and higher incomes are catnip, but swelling rates are lethal. Mortgages that were barely over 2% in early 2017 will be at 4% during 2018. Add in the effect of the mortgage stress test, and the qualifying rate will be closer to 6%. The mortgage brokers estimated days ago that this will affect 100,000 families and knock fifty thousand of them out of the real estate market next year. The Bank of Canada figures up to 10% of wannabe buyers will be denied. Overall credit could contract 18% – because of the stress test alone.

So far in 2017 average house prices in the GTA, for example, have declined by 2% even before factoring in the punishing closing costs and commission to sell. For detached homes, the loss has been between 8% and 10%. Meanwhile investors with balanced, diversified portfolios have made the better part of 10%. The gap between those two is huge. In 2018 it will likely yawn further.

If you need a house, can afford one without gutting your liquid net worth, and still retain financial balance in your life, go ahead and buy. The best prices are typically at this time of the year.

But don’t confuse a house with an investment. That would be so 2016.

156 comments ↓

#1 Jimmy on 12.11.17 at 6:40 pm

Hey, I only come here for the dog pics!

#2 Dartle Dortie on 12.11.17 at 6:42 pm

Garth, it is so nice to be in the clear and actually have a good economy again! Everyone needs to enjoy this great opportunity of great leadership by Justin Trudeau and Donald Trump! Thank-you for saving our economies!

#3 rknusa on 12.11.17 at 6:53 pm

Trump: Love him or hate him, the election of this wingnut signaled the end of the deflationary post-crisis years and the start of a new era of cowboy capitalism.

and this new era of cowboy capitalism will end in tears, those well positioned will make big money but the finances of the general public will be laid to waste

#4 akashic record on 12.11.17 at 6:53 pm

Yeah, it’s not Bitcoin. But a balanced, low-vol, diversified, 60/40 portfolio has handed investors close to 10% this year. And it was 8.5% last year.

—-

That’s for sure.

Bitcoin has handed risk takers a growth from USD752 to USD17K this year.

I hope nobody lost their shirt by shorting it when it became available yesterday, just to smooth the pain of FOMO.

#5 Jungle on 12.11.17 at 6:55 pm

I feel good now but Ryan’s post about bonds and stock market crashes had me scared.

Which is it?

#6 Dogs Luv to lie in the middle of a forest path while watching a lamppost near a Hippie on camera on 12.11.17 at 6:56 pm

You must be dreaming cowboy if you think that the infamous currency devastator of Wiemar proportions (Poloz) will hike interest rates in response to globe growth.

If Poloz only hikes interest rates by 0.25%, increasing our overnight rate to 1.25%, what do you think will happen to those luxury high rises in downtown Toronto (Mizrachi towers at 1 Bloor is at a record high 87 floor tower).

What do you think real estate investors like Bard Lamb and Larry Silverstein would do if his investments in real estate in Toronto lose value?

Poloz was advised to keep the real estate Ponzi going at all costs. Those mega skyscrapers need to be built in downtown Toronto. Poloz is basically telling the rest of Canada that they should live under Wiemar-like conditions.

#7 Ronaldo on 12.11.17 at 7:01 pm

Mortgaged your house yet?

https://www.investopedia.com/news/people-are-mortgaging-their-houses-buy-bitcoin/?partner=YahooSA&yptr=yahoo

#8 Linda on 12.11.17 at 7:02 pm

Garth, can you clarify what might occur should the Canadian housing market drop substantially over the next year? Wouldn’t a price plummet or housing correction have an adverse impact upon the Canadian economy, given that so many are carrying so much debt? Thus the rising interest rates may spell joy for investors but empty the piggy bank (if anything is still in it) for those already stretched to the limit financially? Or have I misread what this blog has been saying regarding the impact of rising interest rates would have on the Canadian housing market/economy?

#9 Lost...but not leased on 12.11.17 at 7:02 pm

Phyyrrzzt.

#10 Smartalox on 12.11.17 at 7:04 pm

Good times coming for those that hold assets, hard times coming for those that hold debt. If you think the recent bleating about (wealth) inequality was an excuse to fleece the wealthy, you’re really going to hate the taste of sour grapes for the next few years.

#11 Nerds Always Win on 12.11.17 at 7:10 pm

Nerds always win, which is why bitcoin is going to $100k over the next 18 months. The blockchain stocks on the TSXV and CSE will follow. You don’t have to agree with me, so just sit back and watch the show.

#12 Small_Town_Steve on 12.11.17 at 7:12 pm

First!
Lol couldn’t resist.

#13 People are Strange on 12.11.17 at 7:13 pm

I don’t want to be first

#14 Buddy on 12.11.17 at 7:15 pm

Wow, Gartho, gonna up a fortune telling shop next to the bellfountain this year? Some bold predications chief.

#15 Adam on 12.11.17 at 7:16 pm

When everyone is greedy, be fearful…

#16 Greed and Fear on 12.11.17 at 7:26 pm

US interest rates rising, jobs and incomes growing, USD appreciation against the CAD (and world currencies) for the foreseeable future – yeah, I’m actually betting on further Canadian price increases.

There is absolutely no reason to believe Canadians won’t find the extra cash to put down on a house from families/B lenders.

Just because Canadians are stupid doesn’t mean the smart thing to do will be the right thing to do any time soon. Anyone who is being “smart” with their money right now is just a deferred savings account for Trudeau/Morneau et al.

Rest assured, the government will be coming for your hard-earned and well-saved dollars before they even consider tapping into Canadian real estate for its tax coffers.

Hold $50K of US stock in a taxable account? You must be “wealthy” since you tapped out your TFSA and RRSP.

Hold a $5M single family home in West Van? Well, everyone needs a place to live!

#17 Andrewski on 12.11.17 at 7:33 pm

Looking forward to seeing how 2018 plays out Garth.

#18 bubu on 12.11.17 at 7:34 pm

“If you need a house, can afford one without gutting your liquid net worth, and still retain financial balance in your life, go ahead and buy. The best prices are typically at this time of the year.”

So you believe prices will be flat or go up… why would you tell somebody to buy if you don’t?

#19 I thinks I know something on 12.11.17 at 7:34 pm

“Trump: Love him or hate him, the election of this wingnut signaled the end of the deflationary post-crisis years and the start of a new era of cowboy capitalism.” – Garth

———————————————

Wingnut is right. He doesn’t even know how to spell political correctness. Trudeau does.

#20 Thoughts? on 12.11.17 at 7:35 pm

Hey there Dogs, looking for your opinions – a friend of mine unexpectedly bought a new condo last week, here’s the details..

45yo single female
Steady, stable job @ $65K/yr
$280K very nice condo (20yrs old) in Surrey (near Whalley)
$90K deposit (drained her savings acct)
25yr mortgage / 5yr fixed interest rate
45 min train commute to work each way, everyday
First time homebuyer – really wanted to finally have her own place (has 2 pets)

While she was telling me about it I couldn’t help thinking about all the warnings I read here. At the same time, have to admit, I was kind of envious. Finally, after years of hassles with roommates (I was one of them) she now has a lovely, stable home she can call her own, and I’m stressing out trying to find an affordable rental close to my job in Vancouver. Adding insult to injury, her mortgage will be close to the same amount as my new rent. Sometimes it’s hard to see the upside of renting & investing while surrounded by friends taking the leap into home ownership.

What are the pros & cons at this point in her life? I feel like I’m missing something. It does seem like a good plan. She’s willing to make the sacrifices, and her new condo makes her happy, so why not?

#21 GhostofChristmasPast on 12.11.17 at 7:36 pm

Why do you never mention the combined Consumer Debt, Government Debts and Corporate Debts and how they have hit record highs well above the previous economic cycles Sir?

#22 Gaga on 12.11.17 at 7:37 pm

Looks like Garth is no longer confident about 20-30% haircut in GTA

#23 tccontrarian on 12.11.17 at 7:37 pm

“Trump: Love him or hate him, the election of this wingnut signaled the end of the deflationary post-crisis years and the start of a new era of cowboy capitalism. The tax cut ushered in a week ago is monumental.” -GT
————————————————————

“a new era of cowboy capitalism” – until the cowboys get bucked off the horse.
Buying the Dow now is almost as crazy as buying into Bitcoin – in my opinion, of course!

tCC

#24 PastThePeak on 12.11.17 at 7:39 pm

I don’t think the global economy will go off a cliff, but will be interesting to see how all of the unprecedented ballooning in global credit unwinds. With all of this great predicted growth, the ECB and BOJ that are still QE’ing 10’s of billions per month should be at least stopping, and the Fed unwinding. That is going to be a huge change in credit availability and those swings always unearth some big cracks.

#25 For those about to flop... on 12.11.17 at 7:47 pm

Boise ,Idaho looks like a good place to buy if you want to stay away from those pesky Millennials…

M43BC

“This Map Shows Where Millennials are Buying Houses (and for How Much)

Millennial homeownership rates are essential to understanding the housing market because they facilitate additional home sales for other people. How does this work? Suppose you make an offer on a house. The current owner is also probably on the market, and he or she likely has a contingent offer on another house. This sets off a chain reaction throughout the economy. Millennial homeownership rates are therefore an easy way to judge the economic vitality of any given area. That’s why we created this new map.

Our viz takes millennial homeownership data from Abodo and maps it by metro area across the country. Abodo adopted the data from the U.S. Census Bureau, which regularly collects a variety of information about the population, including the age of homeowners, the estimated value of their homes, and how long it would take to accumulate a 20% down payment. Our numbers are from 2015. We then overlaid this information across metro areas with bubbles representing the portion of millennial homeowners in each market: the bigger the bubble, the more millennial homeowners there are. We also color-coded each bubble to represent the median value of their homes—dark red circles mean the homes are worth over $500k, and dark blue means under $200k. This gives you a quick snapshot of the overall economy and the housing market.
The first trend you can see on the map is a clustering of red circles on both the West Coast and along the Northeast. The most expensive city in the country for millennials is San Jose, CA, where the average millennial buys a home worth $737,077. Seattle, WA in the Northwest is also relatively expensive at $342,769. These are population-dense areas with booming tech sectors. At the other end of the spectrum, you can see clusters of blue bubbles across the Midwest in old manufacturing cities like Detroit, MI ($148,404) and Cleveland, OH ($160,251). Memphis, TN is the cheapest place for millennials at $142,795. Southern states like Texas and Florida are also relatively affordable thanks in large part to their suburban sprawl, which Zillow predicts will expand next year.

It’s no surprise that homes are more expensive in California (think Silicon Valley) than the industrial heartland, but consider how homeownership rates change based on affordability. The red bubbles all tend to be smaller than the blue bubbles. This means that as homes get more expensive, millennials become increasingly unable to afford them. It’s not like there’s a surplus of ultra-rich millennials buying up all the houses in California and New York. Millennials are just as sensitive to high prices as everyone else.

Let’s break the map down into a top ten list of the urban areas with the highest rates of millennial homeownership, combined with the average price of their home. A full 42% of the millennials living in Minneapolis-St. Paul, MN own their own home, the highest rate in the country.

1. Minneapolis-St. Paul-Bloomington, MN-WI: 42.4% and $222,528

2. St. Louis, MO-IL: 40.2% and $167,791

3. Detroit-Warren-Dearborn, MI: 40.2% and $148,404

4. Louisville/Jefferson County, KY-IN: 38.5% and $158,974

5. Pittsburgh, PA: 37.5% and $152,731

6. Indianapolis-Carmel-Anderson, IN: 37.4% and $161,856

7. Kansas City, MO-KS: 37.1% and $170,254

8. Nashville-Davidson–Murfreesboro-Franklin, TN: 37.0% and $213,090

9. Oklahoma City, OK: 36.7% and $172,485

10. Baltimore-Columbia-Towson, MD: 36.3% and $272,805

Buying a home is often the biggest financial decision anybody makes, and that’s especially true for young people. And there’s a lot to consider when buying your first home, but one thing other than affordability to keep in mind is how many other millennials are in the same situation. If you’re a millennial looking to buy a home, and you want to live next to other young people, you just might have to move to the Midwest.”

https://howmuch.net/articles/millennial-homeownership-large-cities

#26 Danny on 12.11.17 at 7:55 pm

Wow…yesterday’s blog divided the comment section into 2 sides of the fence…..supporters reflecting on royalty as ” do gooders”and those who viewed history in a different way…..” royalty as another word for “dictators…..looking out for themselves ”
Guess it depends on one’s reflection of their family history and on which side of the sword your family was on.

Whether it was French, Spanish Italian or English royalty…..does it matter? ….Royalty affected families big time…. And for a long time…generations…..not just few years.

Today’s blog….again I assume….2 sides of the fence….”the market shows too much confidence….the peak is too sharp” and of course those that believe there is too much debt historically speaking by the public sector and now personal private sector…..debt can’t be paid off in one’s lifetime if debt trend continues……….trouble is looming….And on the other side of the fence We are rich….and getting richer.
Garth your blog laid it all out…..both sides of the fence.
Looking forward to the comments today.

#27 TheSecretCode on 12.11.17 at 7:58 pm

This just in. It was spotted in the parking lot carrying a duffel bag outside of River Rock Casino in Richmond, BC:

▄██████████████▄.▐█▄▄▄▄█▌
████████████████▌▀▀██▀▀
████▄████████████▄▄█▌
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#28 crowdedelevatorfartz on 12.11.17 at 7:59 pm

@#20 Thoughts

Well.
Your friend will feel pretty stupid if her 280k condo is worth 200k next year ( bye bye downpayment) but her payments remain the same.
Your friends mortgage is the same as your rent….what about her condo fees, unexpected repairs, leaky condo assessments on a 20 year old roof, boiler, elevators, pipes,……?
What about a$$hat neighbors that “party til its 1999”?

You rent.
You can move.
So can she.
For a loss.

#29 Nonplused on 12.11.17 at 8:03 pm

I think corporate taxes are redundant. After all they don’t own themselves. Sooner or later the owners get the dividends and you can just tax that. The only issue would be for foreign held stocks and corporations but they could tax the distributions on their way out of the country.

Worse, corporate taxes hinder the ability of a corporation to raise investment capital. After all you can’t use money to build a factory that you have to send to the government. The only alternative is to borrow money or sell more shares, but both are dilutive.

But it is all part of the economystical theory that if you tax the same dollar enough times you can end up with more than a dollar. So if I own a share in a corporation, and that corporation earns a dollar, I pay corporate tax, income tax, CPP, EI, and GST on before I get any spending power. That’s 5 taxes not counting all the other embedded taxes like property taxes, gasoline taxes, sin taxes, carbon taxes, and royalties.

We are simply drowning in taxes.

Even the so called $15 now movement is just an underhanded way to raise taxes. Sure, the workers will se some more money, but lets shake it down. If you live in BC and assuming 40 hours a week and 50 weeks a year, at $9 a hour you will earn $18,000 a year and pay $1,981 in taxes and CPP and what not. If you get a raise to $15 an hour you will earn $30,000 a year and pay $5,019 a year in taxes and such. So that’s a 66% increase in your wages but a 153% increase in your taxes. And since there are a lot of people who are affected by the new minimum wages, governments could not have come up with a better way to raise more revenue. It will have way more impact than trying a big tax rise on the 0.01%.

And since the employers who have to pay the new minimum wages don’t have any money (corporations in general do not have any money, only assets and expenses), they will have to raise prices. You will pay the higher minimum wage, and also the higher taxes, every time you order a coffee from Starbucks or gas your car. There is no other place for the money to come from.

A lot of people think “corporations” are some sort of bucket of money just totally in need of draining by the government, but it is not true. They don’t have any money, only assets and expenses. Let’s look at a simple 7-Eleven. The owner has franchise rights and a lease on the building, plus a bunch of money tied up in inventory and Slurpee machines. He also has a bunch of employees he has to pay every 2 weeks. He doesn’t have any money. Instead he has a revenue stream that comes from sales. In the event that sales no longer cover all these expenses he goes broke, and rather quickly. If he experiences any rise in his expenses, whether wages, taxes, or rising costs of inventory, he must immediately raise prices or he will go broke.

So they can’t raise taxes on the 7-11 franchisee because his marginal rate is probably over 40% so you can’t get a 153% tax rise out of him or his rate would be 101%. So they have brilliantly come up with the idea of raising the minimum wage, because that would affect millions and millions of people and it’s easy to sell because the minimum wage workers will see an increase in take home pay, but at the expense of everybody and also of many of their jobs.

The government is just squeezing us every way they can.

It raises a theoretical question. If it costs so much money for the government to provide whatever services they provide, let’s for now include law and order, defense, roads, transit, airports, health care, CPP, EI, hockey rinks, stadiums for artificial pro sports leagues, and Bombardier subsidies, have we now reached the point where we have raised our expectations of government beyond our ability to pay for it? I think we have. Actually probably some time ago. You are expecting much more from government than you produce, and have been for some time. That is why there is a national (and provincial and civic) debt. A deficit can be understood if it’s a deficit here and a surplus there. Chronic deficits are the road to ruin.

#30 Dolce Vita on 12.11.17 at 8:06 pm

How very good for the US and the World.

You forgot about NAFTA.

#31 I wanna marry Janet Yellen on 12.11.17 at 8:07 pm

#16 Consequences of Poloz hyper-inflation: pain of hipsters and feminists on HELOCS eased temporarily, the illusion that Toronto real estate will rise again, only a privileged few clients of Morneau and his feminist cronies benefit,

You end up with even more bad debt, speculators in Toronto and Vancouver being rewarded, savers punished, the dollar destroyed, retirement nest eggs and pensions worthless while we pay more tax on Poloz peso.

Poloz refuses to hike rates. FX analysts forsee that if Poloz stays put into Q3 2018, the US dollar will be worth at least C$1.35-$1.44 range because of interest rate differentials and higher inflation because of a lower Canadian dollar.

Trudeau wants us to withdraw our savings for a downpayment for an overpriced shoebox or to steal from Garth’s terminology “plywood and glue box houses”.

As men in our 20s to 40s, why should we spend our savings for Toronto & Vancouver real estate speculation under the threat of it being devalued because of Poloz Peso?

This economy needs a reset, and fast.

#32 Pete on 12.11.17 at 8:08 pm

At least I am not alone to see that bitcoin was created by government agents to get the puppet masses to like digital money
/2017-12-10-evidence-points-to-bitcoin-being-an-nsa-psyop-roll-out-one-world-digit

#33 Pete on 12.11.17 at 8:09 pm

Here is link https://www.naturalnews.com/2017-12-10-evidence-points-to-bitcoin-being-an-nsa-psyop-roll-out-one-world-digital-currency.html

#34 Darryl on 12.11.17 at 8:11 pm

That tree drank to much Turpentine btw. Or maybe I did ;)
12 year old single malt of course.

#35 NoName on 12.11.17 at 8:15 pm

#4 akashic record on 12.11.17 at 6:53 pm
Yeah, it’s not Bitcoin. But a balanced, low-vol, diversified, 60/40 portfolio has handed investors close to 10% this year. And it was 8.5% last year.

—-

That’s for sure.

Bitcoin has handed risk takers a growth from USD752 to USD17K this year.

I hope nobody lost their shirt by shorting it when it became available yesterday, just to smooth the pain of FOMO.

—-

https://twitter.com/nntaleb/status/939526347730407424

#36 palebird on 12.11.17 at 8:17 pm

#29 nonplused “It raises a theoretical question. If it costs so much money for the government to provide whatever services they provide, let’s for now include law and order, defense, roads, transit, airports, health care, CPP, EI, hockey rinks, stadiums for artificial pro sports leagues, and Bombardier subsidies, have we now reached the point where we have raised our expectations of government beyond our ability to pay for it? I think we have. Actually probably some time ago. You are expecting much more from government than you produce, and have been for some time. That is why there is a national (and provincial and civic) debt. A deficit can be understood if it’s a deficit here and a surplus there. Chronic deficits are the road to ruin.”

Right on the money. That is why Canada is screwed and I do not see this changing anytime soon. And the Dow is going straight up along with the USD. Trump is taking the high road and most everyone else is taking the low road. Lot’s of money to be made, probably a once in a lifetime situation.

#37 oncebittwiceshy on 12.11.17 at 8:20 pm

Greed and Fear: “I’m actually betting on further Canadian price increases.”
<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<

… and I'm betting that you're in the industry. The smart money got out or is doing their damnedest to get out by year end.
<<<<<<<<<<<<<<<<<<<<<<<<<<<<

Linda: "Wouldn’t a price plummet or housing correction have an adverse impact upon the Canadian economy, given that so many are carrying so much debt?"
<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<

Yes Linda, you are indeed correct. OSFI legislation will be the end of this incredible run up in real estate and the beginning of the most devastating correction/crash that Canada has ever seen.

I tend to review opinions with a grain of salt but this guy has a lot of very pertinent points regarding Canada's future.

http://www.moneygeek.ca/weblog/2017/10/16/canadian-housing-market-bubble-interview-seth-daniels-jkd-capital/

"the main thing that credit bubbles share is the amount of debt that’s being taken on and how quickly it is growing. If you look at housing and financial insurance, real estate, construction, consumer spending, as a percentage of the economy, it’s bigger in Canada than it was in the US. Basically any metric that you look at, it’s a bigger bubble in Canada than it was in the US, at least the ones I used to analyze the US bubble at the time."

#38 TheSecretCode on 12.11.17 at 8:25 pm

Look at what happened with a little-known cryptocurrency called NEM.

+291,142% in the last couple of years.

That’s enough to turn a single $100 bill into $291,242.

#39 TheSecretCode on 12.11.17 at 8:27 pm

A small $500 investement into Ethereum would have ballooned into a retirement fortune of as much as $407,822… in just a couple of years.

And a slightly larger investment could’ve literally turned into millions.

For example, a $5,000 investment in another cryptocurrency called SibCoin…$2.8 million fortune… in a matter of months.

#40 TheSecretCode on 12.11.17 at 8:31 pm

What’s Set to Happen?

You see, with cryptocurrencies minting new millionaires seemly everyday…

this Single Event is About to Catapult Cryptocurrencies into the Third and Most Explosive Stage of the Boom

Simply put, this event will trigger a buying frenzy…

And help mint a new round of crypto millionaires.

You see, big tech companies like Microsoft and Overstockare already accepting Bitcoin as a form of payment.

But what would happen if the world’s largest online retailer started doing the same?

We’re about to find out…

Because with the popularity of Bitcoin exploding…

With people like Bill Gates saying cryptocurrencies are “the future of money”…

And with big economies like Japan legalizing Bitcoin as a form of payment…

I am certain that Amazon WILL ACCEPT Bitcoin.

#41 Blacksheep on 12.11.17 at 8:33 pm

OK….Growth, inflation, upward wage pressure and dirt cheap rates next year @ 4%…got it.

Sorry Dogs, so much for your RE crash.

Can’t wait to read the comments tonight.

#42 TheSecretCode on 12.11.17 at 8:38 pm

Amazon will be the tipping point that will create massive generational wealth unlike we’ve ever seen before.

Of course only Amazon’s CEO Jeff Bezos knows for sure the exact date this will happen…

But given the company’s history of staying ahead of its retail rivals…

Amazon could make the announcement as early as February 2, at 4 p.m., during its next earnings conference call.

Nov 1, 2017 – Amazon registered for three cryptocurrency domains.

Just remember: 95% of all cryptos are worthless… and will eventually go to zero.

Place your bets accordingly.

#43 akashic record on 12.11.17 at 8:38 pm

#19 I thinks I know something on 12.11.17 at 7:34 pm

“Trump: Love him or hate him, the election of this wingnut signaled the end of the deflationary post-crisis years and the start of a new era of cowboy capitalism.” – Garth

———————————————

Wingnut is right. He doesn’t even know how to spell political correctness.

Yet he won the competition for the world’s most contested political role, against all odds, at the age of 70.

Could you?

#44 Pete on 12.11.17 at 8:51 pm

Interest rates are going up and up and up

http://business.financialpost.com/news/economy/investors-told-to-brace-for-steepest-rate-hikes-since-2006-1

#45 Linda on 12.11.17 at 8:52 pm

‘Thoughts’ – regarding your friend, I hope it all works out for her. Myself, I’d never purchase a condo. All the risks of renting, but with the responsibility of being a landlord. In other words, having to pony up for repairs, special assessments, put up with condo board rules that can & do regulate how you can live in ‘your’ own home, condo fee (rent) increases etc. I do trust your friend did due diligence & that 28 year old building was recently renovated into tip-top shape before she purchased AND has a very healthy reserve fund for any repairs.

#46 the Jaguar on 12.11.17 at 8:52 pm

I like the small carpet Bandit is lying on. Hard to say who has the more fetching smile. We’ll call it a ‘tie’.

The bigger problem with interest rates and Mr. Stress Test isn’t house purchases. It will also apply to any (and there are many) requests to ‘refinance’ debt using a house as collateral. Many are ‘tapped out’, hanging on by their fingernails, and only now beginning to realize it. The chicken’s always come home to roost.
Just ask Sadie, the dog on yesterdays blog. Banks will always find a way to look after any debt that presents a risk to them alone and/or their shareholders, but other peoples problems will just have to wash up on someone else’s beach. A good time to be in the loan shark biz, I suppose.

#47 nick on 12.11.17 at 8:56 pm

Massive private and household debt levels, Central banks buying up assets now sitting on huge balance sheets, average US citizen is still not better off than they were before after the 2008 crash even after this “recovery”, China slowing down, interest rates flat or heading higher, US employment is up due to increases in lower paying jobs (also wage growth is consistently coming in below expectations, and downwards revisions are happening from prior periods), old people working jobs instead of retiring because they have nothing to retire on…

I love this blog but im honestly kind of surprised things look so rosy in your opinion. Seems more like a debt fueled fake economic recovery to me. More of a “looks great on the outside, but has problems under the hood”.

Asset prices around the world have been blowing up for years. you could have invested in almost anything and reaped double digit returns. Too bad the average person isnt the main beneficiary of a huge stock market rally due to CB asset purchases and low interest rates.

#48 For those about to flop... on 12.11.17 at 9:00 pm

#111 oncebittwiceshy on 12.11.17 at 3:12 pm
102 Mattl:”Both homes held for under 5 years and profit over 500k on each. Bottom line is your 1 year study only looks at a fraction….of a fraction of the market.”

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

…. or perhaps Flop is actually in tune with the current market and you are remembering the glory days.

https://thinkpol.ca/2017/12/11/many-metro-vancouver-homes-selling-for-a-loss/

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

Hey Once,thanks for trying to stick up for me today while I was at work.

The person you responded to is in my " Do not waste your time replying to this person " folder.
There are about ten people in that folder and it seems to annoy them that I won't respond.They appear more interested in arguing than in swapping information.

A couple of things,virtually all the houses in that article have been featured on this blog by myself but it was not I who sent the information to them.

I only conduct my project for this blog and on this blog.

Also I have admitted my study ,like the person conducting it has many faults but it has brought to light many verifiable facts.

Also my critics like to say a house here and a house there does not make a study.

From January about June before I went back to work and was learning how to walk again after a botched surgery I was looking at around 250 houses a day.

So even before I had gone back to work I had studied tens of thousands of houses and stockpiled the purchases that I found interesting and watched it play out.It is an ongoing situation with obviously many reluctant to take a loss.

Since being back at work I do roughly 50 listings on each of the weekend days and this frees up a bit of time to follow up and document the Pink Draws and the Confirmed Pink Snow.

While I was off work I studied the entire market,since going back to work and because of the reduction of time spent I no longer spend much time on Condos because of the current trends seemed to warrant spending more time on detached properties.

Having said that in the earlier part of my study despite a robust condo market I had absolutely no trouble finding condo owners in trouble and as confirmed on here some losses.

I think from memory the majority of these were in Richmond but also found people in strife in Olympic Village and in some older condos in Coal Harbour.

Even some of the Specuvestors in Trump Tower are having trouble getting out.

One case I was looking at yesterday they were going for a 11% gain ,but after expenses roughly a 5% gain and they can't find a buyer and are not done yet.11 other condos are providing some internal competition.

The boss of this blog has stated multiple times that time itself is our most important asset and I have been accused of wasting mine.

This is my choice, I believe this blog is worth it.

To my critics,if you would be so kind as to put your phone numbers up on the blog and I promise I will call you every time I do a session to see if now is a convenient time for you and for myself to do some public service…

M43BC

#49 People are Strange on 12.11.17 at 9:04 pm

#20 Thoughts

What are her condo fees?

#50 akashic record on 12.11.17 at 9:10 pm

#35 NoName on 12.11.17 at 8:15 pm

#4 akashic record on 12.11.17 at 6:53 pm
Yeah, it’s not Bitcoin. But a balanced, low-vol, diversified, 60/40 portfolio has handed investors close to 10% this year. And it was 8.5% last year.

—-

That’s for sure.

Bitcoin has handed risk takers a growth from USD752 to USD17K this year.

I hope nobody lost their shirt by shorting it when it became available yesterday, just to smooth the pain of FOMO.

—-

https://twitter.com/nntaleb/status/939526347730407424

Taleb is probably correct.

The entire idea to trade a derivative on a market that doesn’t operate 24/7/365, as BTC does, on several exchanges worldwide, is funny to me.

The settlement reference rate for the derivatives as the spot price, operated by the tiny company of a (maybe) former Goldman Sachs guy out of London is a funny business, Jekyll Island comes to my mind.

I am perfectly fine riding BTC and some other cryptos, but I have zero interest in the derivatives.

#51 45north on 12.11.17 at 9:16 pm

Linda: Garth, can you clarify what might occur should the Canadian housing market drop substantially over the next year? Wouldn’t a price plummet or housing correction have an adverse impact upon the Canadian economy, given that so many are carrying so much debt? Thus the rising interest rates may spell joy for investors but empty the piggy bank (if anything is still in it) for those already stretched to the limit financially?

Linda I think you know the answer, at least part of it. Next year, lets say 25% of mortgages come due. If prices stay right where they are now, let’s say half of them fail the stress test. The bank sends out letters saying it will renew the mortgage but at 1% higher rate. Or the home owner can pay the full amount. The 1% is on top of everything else – gasoline prices, car maintenance, whatever. Seth Daniels: generally people miss the non-linearity of what happens in the down part of a credit cycle. If prices drop 10% then more than half will fail the stress test – more letters go out. I suppose the good news for the people without debt or at least with little debt – line up times at the car dealership disappear, there’s lots of help at Home Depot. The trick is do not advertise!

two posts down:

Smartalox: Good times coming for those that hold assets, hard times for those that hold debt.

that’s my reaction: the best of times, the worst of times.

#52 Zapstrap on 12.11.17 at 9:25 pm

#20 Thoughts? on 12.11.17 at 7:35 pm

Hey there Dogs, looking for your opinions – a friend of mine unexpectedly bought a new condo last week, here’s the details..
——————————————————————
Whalley … really?

#53 Robert B on 12.11.17 at 9:47 pm

Nice positive blog today.

Let the games begin……

#54 The Great Gazoo on 12.11.17 at 9:49 pm

This news should help Ryan meet his US $60 (WTI) target price of oil in 2017 – currently trading at US$ 58.30.

Repairs to the “Major Forties” pipeline requires the shutdown of 80 (yes EIGHTY) oil & gas platforms in the North Sea. They say it will take 3 weeks to repair, but who knows.

http://www.bbc.com/news/uk-scotland-north-east-orkney-shetland-42308437

Brent oil currently trading over US$65, so Saudis and Russia likely pleased with that.

#55 acdel on 12.11.17 at 9:49 pm

Hey Garth, I cannot complain; grossed 10% on my portfolio this year, others have done better but most not!!

As your weekend columnist eluded to; changes are coming, prepare!!

#56 Walter Safety on 12.11.17 at 9:50 pm

#29 Nonplused
Right on and Thank You

#57 acdel on 12.11.17 at 9:58 pm

#38 TheSecretCode

Not sure if this was posted before, been busy, but this guy seems to get it! Hint, delivery system!!

http://www.cbc.ca/news/business/well-there-s-no-limit-on-it-ohio-student-makes-a-fortune-buying-canadian-invented-ether-cryptocurrency-1.4433510

#58 Millmech on 12.11.17 at 10:06 pm

#28
Did you notice after working 20-25 yrs she managed to save about 300/ mth for the down payment.Now she has another 20years to probably save up another $90,000 to retire on,must have a great DB pension to rely on I think,if not those cats will have competition for the can of Friskies.Who do you think will run faster at the sound of the electric can opener opening the can,her or the cats?

#59 The Pin! on 12.11.17 at 10:20 pm

#35 No Name

Some nice nuggets in that tweet’s replies.
E.g.:

“Bitcoin is the pin, not the bubble.”

Heh heh..

#60 genbizx on 12.11.17 at 10:22 pm

read some pre-2008 predictions…telling
more chearleading than growth going on..
when the things i buy get cheaper we are doing better..aint happening..

#61 mark on 12.11.17 at 10:28 pm

Poppycock.

#62 gfd on 12.11.17 at 10:36 pm

Check this insanity https://www.marxist.ca/analysis/1296-lack-of-affordable-housing-a-symptom-of-capitalist-crisis.html

#63 For those about to flop... on 12.11.17 at 10:37 pm

For those interested in the Thinkpol article below are the details of the number one house on that list.

Featured on this blog multiple times by yours truly.

I don’t think that house sold for ask ,most likely a lot more ,but they felt it necessary to resort to shock tactics.
Been surprised a lot of times during my Pink Project and this could be another one.

As I wrote last night the assessment people are basically clearing the transactions in August this year and have seen a couple in early September but this house should have cleared by now ,but it has not.

It sits in my “Waiting for Clearance” folder and I will show the results on here which hopefully will be soon.

I just went back to the previous thread to cross check some information and was humbled that a few guys stuck up for me.

I am presenting a side of the story that a lot of journalists can’t or won’t…

It’s not perfect ,but it’s better than nothing…

M43BC

$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$

No update
6291 Bellflower Drive, Richmond paid 2.2 April 2016 sold in early June.

Mar 13:$2,480,000
May 24: $1,680,000
Change: – 800000.00 -32%

https://www.bcassessment.ca/Property/Info/QTAwMDA1WEdVMw==

https://www.zolo.ca/richmond-real-estate/6291-bellflower-drive

#64 Site C on 12.11.17 at 10:44 pm

Quick, some one build a crypto farm on site C.

Step 1: build dam
Step 2: build generators
Step 3: build crypto farm
Step 4: mine ether
Step 5: PROFIT!

That $10B investment will pay for itself in no time.

#65 Bottoms_Up on 12.11.17 at 10:47 pm

Two sales in my hood over the past 2 weeks. Usually a slow time of year. Thinking the impending changes are pushing buyers right now.

#66 For those about to flop... on 12.11.17 at 10:56 pm

Pink Pumpkins being carved in Richmond.

This house is one of the few on that Thinkpol list that I haven’t shown here yet,so let’s rectify that.

Picked up for 1.9 million in May 2017

5691 Jaskow Drive ,Richmond .

Currently asking 1.69 million.

Richmond is a mess ,this I must confess…

M43BC

https://www.zolo.ca/richmond-real-estate/5691-jaskow-drive

#67 Newcomer on 12.11.17 at 11:07 pm

#20 Thoughts? on 12.11.17 at 7:35 pm
—-
A few thoughts:
This is the first time I’ve seen the words “Whalley” and “lovey” used that close to each other.

Your friend went from having a year and a half of income in the bank to having about three years income in debt. If her job is as stable as you say, that might not be scary but at 45 it’s also time to start thinking long term. Pretty good move at 35, less obvious at 45.

You say that you’re stressing out trying to find an affordable rental close to your job in Vancouver. Could I suggest finding one that is a 45 minutes commute in a slum. You’d save a lot of money and get to see the life your friend is living.

You say that she’s willing to make the sacrifices, and her new condo makes her happy, so why not?

Indeed, why not.

#68 For those about to flop... on 12.11.17 at 11:18 pm

Pink Pumpkins being carved in Port Coquitlam.

I scrolled through all the ones that I have already shown and this affordable option caught my eye.

3550 Pearkes Place ,Port Coquitlam.

Paid 830k in February 2016

Currently asking 780k

Port Coquitlam has been underrepresented in my study but it is coming back to earth with a thud…

M43BC

https://www.zolo.ca/port-coquitlam-real-estate/3550-pearkes-place

#69 NEVER GIVE UP on 12.11.17 at 11:20 pm

Just had an argument with Rogers Bank Credit card company.

Our card went over limit in un-posted charges while our monthly payment was processing.

Our payment is considered unpaid until they receive it.
At the same time they consider a blocked unpaid out credit card charge a real time charge.

They then technically can charge an overlimit fee of $29.00. Usually companies will waive it but in this case they only were willing to waive it once. It happened to us earlier.

We pay our entire balance every month and they are looking for some free money from suckers.

Most companies will waive it any time you ask because Canada is alone in allowing its Citizens to be ripped off like this by Credit Card Companies. In the USA you have to opt in or they will just block your card when it reaches the limit. That is our preferred option.

I asked them to stop my card when it hits the limit and they said no. They only have the rip off option of going over limit for say $500.00 and they earn another $29.00 in a one month period for a total interest cost of 69.6%.

They waived one of my charges but I am a hard ass about this. I am closing the card we have been using at the rate of 6k per month and paying it off every month. So far we have triggered no interest and only 2, $29.00 overlimit fees.

Canadians are such suckers to pay this fee.

Lay down Canadians.

“Lay Down” is the term used by Auto salesmen to describe a person who pays the sticker price without getting a discount.

#70 Smoking Man on 12.11.17 at 11:21 pm

#64 Site C on 12.11.17 at 10:44 pm
Quick, some one build a crypto farm on site C.

Step 1: build dam
Step 2: build generators
Step 3: build crypto farm
Step 4: mine ether
Step 5: PROFIT!

That $10B investment will pay for itself in no time.
…..

Unlike communist Ontario and the LCBO monoply on feel good. Picture this. Smoking Mans retail weed shack on the beach. Get free book with every once.

100% legal in 3 weeks and you guys think I’m down here for a gig. Ha!

Dr Smoking Man
PhD Herdonomics
Always ahead of the curve.

#71 Paul on 12.11.17 at 11:27 pm

Subprime mortgages 2nd’s 10% , 6% arranging fee $3000 legal fee paid by the borrower, 50% advance interest only.
Why buy a investment property?

#72 For those about to flop... on 12.11.17 at 11:29 pm

I see the Bellflower house is back on the market.

It was sold in June 2017 but the deal must have fallen apart.

Been back up on Zolo for 9 days.

What a mess…

M43BC

#73 Ontario's Left Coast on 12.11.17 at 11:32 pm

#48 Flop

Thanks, Flop, I have always enjoyed your updates and appreciate all you do for the reader of this blog. Cheers and thanks very much!

#74 acdel on 12.11.17 at 11:39 pm

#64 Site C

Normally I would not respond to a post such as yours because I believe that you believe in what you posted!

You just do not get it! Instead of ridiculing the largest opportunity that it going to happen whether you like it or not; study, learn, and take advantage of it, I am not referring to the cryptos but the delivery system; last post I will ever make of this! Good riddance!!

#75 Zachary on 12.11.17 at 11:49 pm

To all those privileged feminists from downtown Toronto who accused the Host of “misogyny” because of that Dog reading a book pic, where were you all when a Muslim woman from Africa was treated worse than a roadkill carcass after she died on a conveyor belt in Toronto?
https://www.thestar.com/news/gta/2017/09/08/one-year-after-this-temp-agency-worker-died-at-fiera-foods-family-is-still-searching-for-answers.html

Seriously, where were the feminists from their comfy office jobs in downtown Toronto? Where were the Pink Hat marches? Where were the protests at the owner’s luxurious Bridle Path home?

No. You harass and advocate violence against an elderly Vancouver guitar surfboard Liberal who loves Harley bikes and has the stamina of a 25-year-old man.
All because he posted a pic which was intended to be a pun and wordplay.

This is unbelievable. Feminists probably don’t protest against owners of businesses which break the law because men who usually drive Bentleys while their associate businesses were investigated for criminal acts tend to be those you wouldn’t want to be in their faces.

Feminists don’t protest against corporations which exploit immigrants and women of color.

#76 down_boy on 12.12.17 at 12:15 am

Second para, ‘it’s jobs’…
Take a look at this chart
http://www.macrotrends.net/1316/us-national-unemployment-rate
what happens when the US, et al, hits ‘technical full employment’.
It happens fast, almost overnight, and today is no different.
How would frontrun this trade? I’m gaming the the employment moonshot won’t make it out of orbit. There’s only one way to go.
The bonds post from Saturday was smart.

#77 TheSecretCode on 12.12.17 at 12:19 am

#20

You left out a ton of details.

You should also do your own math to verify all of this.

Here are my guesstimates…

We will go with the typical benchmarks – this will be close but not exact.

2089.88 per month gross to cover the rent if used as a rental (submitting all income to CRA).

It will pay for itself in 11.16 year as a rental being rented to someone else at the above gross amount.

1326.37 approximately is what she will be paying per month for the roof over the head (all in).

Her max affordability with stress test at current rate is 326K.

Consider rising interest rates and the added costs if they start rising.

#78 april on 12.12.17 at 12:26 am

#65 – of no interest if you don’t state what your location is.

#79 Nonplused on 12.12.17 at 1:53 am

#36 palebird
#29 Nonplused
“Right on the money.”

#56 Walter Safety on 12.11.17 at 9:50 pm
#29 Nonplused
Right on and Thank You

I think I post here so often, I think I might have 30% as much text as Garth does. I shouldn’t really do it I should be off riding motorcycles or at the strippers or something more productive. But like Garth, I like to see my own thoughts in text, and also like Garth I think that I am not the only one out there that sees these things. I like knowing that I am not alone, and that not the whole world is crazy, only most of it. So thank you.

Being financially literate in today’s world is like being an atheist at a Christian camp for kids. It’s not accepted. Garth is doing good work.

#80 MikeJ on 12.12.17 at 1:57 am

Flop, you might find some useful info here to update your lists:
https://thinkpol.ca/2017/12/11/many-metro-vancouver-homes-selling-for-a-loss/
List of 100 properties at the bottom of the page that are already selling for a loss and those are asking prices. Losses not counting interest paid and other costs are up to 25% on some properties on the top of the list

#81 Smoking Man on 12.12.17 at 2:11 am

Costco wine is shit until after the 3rd bottle then it gets good.

Canadians can’t experience that feeling. Lcbo bitches. Those db pensions need funding.

My weed recipe, I’m going to oun California soon. Then the mid west then NYC.

Not coming to Canada any time soon.
Enjoy your govt sanction garbage.

#82 fishman on 12.12.17 at 2:46 am

I see the Libs just took Surreysouth & Whiterock. I know ROC hears Surrey they think ethnic gangbangers but Surreysouth is white, rich, horsey, hobby farm,holding property. (Bill & Melinda would drive their daughter up from Seattle to compete in teenage girls horsey stuff.)& Whiterock like its namesake is white,older, welloff, big retired population. Same as two more Van Liberal ridings, Point Grey, & West Van. A lot of constituents there are like me, rich, white, dumb,old, fat f***s: but they sure don’t vote like me. They vote Liberal. Maybe they are different than me, maybe their not dumb. And the poorer all white crowd on the Island goes Greenie & Dipper. Who says that letting oodles of offshore casheruno in doesn’t get votes?Or maybe its a higher education. Whatever, the white elites out here on the West Coast love their Progressive Agenda.

#83 AGuyInVancouver on 12.12.17 at 2:57 am

#28 crowdedelevatorfartz on 12.11.17 at 7:59 pm
@#20 Thoughts

Well.
Your friend will feel pretty stupid if her 280k condo is worth 200k next year ( bye bye downpayment) but her payments remain the same.
Your friends mortgage is the same as your rent….what about her condo fees, unexpected repairs, leaky condo assessments on a 20 year old roof, boiler, elevators, pipes,……?
What about a$$hat neighbors that “party til its 1999”?

You rent.
You can move.
So can she.
For a loss.
_ _ _
Nobody who has been renting the same place in Vancouver for more than 5 years is going to move. T do so means you will be playing way way more in rent, and you’ll be competing with a horde of eager renters for each place.

In short, unless your family situation changes drastically you’d be a fool to give up a decent rental in YVR.

#84 down_boy on 12.12.17 at 3:08 am

I found my sector to short in this ‘bubbly’ economy…
https://www.bloomberg.com/news/articles/2017-12-10/maersk-warns-of-falling-freight-rates-in-bearish-sign-for-trade

#85 nick on 12.12.17 at 6:44 am

@#51 45north

You’re kind of off here. Biggest problem is that you seem to think people renewing have to go through the stress test, this is false, IF you stay with your current lender.

Lots of mortgages coming due, but if you consider the typical and most popular mortgage product, a 5 year fixed, rates back then were about the same as today. 5 years ago, price wasnt as crazy as it is now, and it was actually pretty good if you consider the low interest rates. Took a few years but then prices started rocketing up.

So people wont fail the stress test if they bought 5 years ago. NOt only that, if they stay with their current banks they dont have to do the stress test, but they will have to eat whatever rate they are fed by their current lender.

So the people who will have a tough time are those who had 1-3 year terms, especially those who bought last year.

#86 Howard on 12.12.17 at 7:23 am

Crooked Christy has a kindred spirit in Australia.

https://www.nytimes.com/2017/12/12/world/australia/sam-dastyari-resigns-china.html

#87 Howard on 12.12.17 at 7:35 am

If you thought the Dow was at nosebleed level, you’ll be awed at what lies ahead. Will there be some corrections along the way? You bet. Ignore them.

——————————–

Well this is what everyone generally believes at this point.

I have a sneaking suspicion that this will be the mirror image of the aftermath of Trump’s election. Remember that almost everyone thought the markets would crash and gold would soar. As we all know, the opposite occurred.

This time, almost everyone is predicting a bubblicious 2018 in the major indices resulting from these tax cuts. Remember that many corporations were already paying low effective tax rates due to loopholes, tax havens, etc. Official employment numbers can’t get much better so there’s only one direction it can go. This bolsters the contrarian view that markets will decline, particularly as the Mueller investigation inches closer to Trump himself.

You forget global growth. Far more consequential than a corporate tax cut not even yet enacted. — Garth

#88 Big Daddy on 12.12.17 at 7:40 am

While I commend a 10% investment return , what happened to all the juicy returns on the likes of CPD and RCI.b etc both up 25 and 30%? Oh, right…..the real profits were sucked away into the ‘safety’ of bonds which paid ….zero……which is why more than 50% of the potential gain is where the money has gone. Like my darling wife says…”only but the stocks that go up”.

Consistent returns are great, but the real enemy of most people is volatility. A reasonable, diversified bond component does wonders to dampen that and relieve anxiety when inevitable declines occur. Everyone’s a cowboy in a rising market. — Garth

#89 Penny Henny on 12.12.17 at 8:15 am

Bitcoin soon to be outlawed because it is bad for the environment!

https://www.theweathernetwork.com/news/articles/is-bitcoin-an-energy-guzzler/90690/

#90 Steven Rowlandson on 12.12.17 at 8:26 am

“But don’t confuse a house with an investment.”

Good advice but most won’t listen for many reasons.

1 They want the tax free capital gains on principle residences.
2 They want to play monopoly in the real world for real.
3 They think real estate is safer than the stock and bond market due to getting financially screwed and that government requires people to have a residence in order to function in society according to law when it comes to driving and mailing addresses.
4 They think they will get rich flipping or investing in houses or other types of real estate.
5 They think all Canadians are made of money and can and will be their obedient financial slaves….

Canadians won’t give up their bad habits until they are utterly ruined by them or until it becomes a legal matter of life and death.

#91 Eyestrain on 12.12.17 at 8:41 am

From the Alt Facts file:

“Lower taxes, higher profits, rising markets, expanding global growth plus robust spending by more people with jobs will have predictable results.” G.T.

Higher national debt, higher prices, hyper-inflated asset prices, isolationism plus more consumer borrowing will have predictable results.

“None of this precludes the possibility of shocks, like a terrorist attack or extreme weather events, or even a recession in the US within the next three years.” G.T.

When they look back, the warning signs will be obvious. A lawyer at the Fed, a madman in the oval office, and those who knew better began running with the herd. The decline of economies and empires are attributed to many causes, but the unwritten truth is that people become fat, lazy and stupid. Swing low Alabama (N. Young).

#92 Howard on 12.12.17 at 8:43 am

Why no discussion ever of oil on this blog? WTI looks set to break the all-important $60 USD level.

Canadian oil stocks still in the dumpster but to me that represents an opportunity. Companies with clean balance sheets (ATH and TOG come to mind) should eventually react nicely to rising oil, particularly once Q4 results are released.

Is value investing/trading completely dead?

#93 Capt. Serious on 12.12.17 at 8:58 am

I was leafing through my copy of The Intelligent Investor by Ben Graham last night. I was reminded of how easy it is for people to be suckered in by the newest latest thing. The copy I have is annotated by Jason Zweig, and lays in context to Graham’s writing some common day examples. Common day for my edition was early 2000s. The parallels between hype for internet stocks in 1999 and bitcoin today are remarkable. Fun fact, in a survey 1338 Americans in 1999, 10% had 85% or more of their investments in internet stocks.
About every generation some segment of the investing world goes barking mad, and it’s always the newbies who think it’s different this time who get creamed. The guys with grey hair have seen the movie before and avoid ruinous decisions. People who have never seen a housing correction should remember that as well.
“An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return.” Amen.

#94 Penny Henny on 12.12.17 at 9:18 am

This guy sounds like a Dr. of Herdonomics.

“Famed University of Chicago economist Richard Thaler, one of the architects of behaviourial finance, has spent decades probing why investors do the things they do.”

https://www.theglobeandmail.com/globe-investor/globe-wealth/investors-should-prepare-for-a-reversal-of-the-bull-market/article37292566/

#95 Mattl on 12.12.17 at 9:39 am

Flop – thanks for making my point. You were looking at 250 houses a day to find one or two that may be losing money on a short term flip. You would passed through thousands of houses that sold above ask and previous sale to get one for your “study.

I couldn’t care less if you respond to me, I’m not looking to debate this. If I had time I would post, day after day, homes that sold for over last sale, over ask and over assessment. But that would be a waste of time. All the info everyone needs on market direction is posted publically.

Continue to post but for gods sake drop the public service act. You have a strong bias and are looking hard to find anecdotes on the market that support your beliefYou are NOT painting an accurate picture of the market. Seriously, ask anyone that is actively looking for homes in this market if there are deals to be had, homes selling for strong discounts over previous.

#96 For those about to flop... on 12.12.17 at 9:46 am

OLC pm
#48 Flop

Thanks, Flop, I have always enjoyed your updates and appreciate all you do for the reader of this blog. Cheers and thanks very much!

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

Hey OLC ,good to see your still lurking and thanks for the kind message.

Also MikeJ ,yes I have studied that article.The majority of houses have already been put up but I will decode some of the others when I get the chance and we will see what happens with them…

M43BC

#97 IHCTD9 on 12.12.17 at 9:46 am

#90 Steven Rowlandson on 12.12.17 at 8:26 am

Canadians won’t give up their bad habits until they are utterly ruined by them or until it becomes a legal matter of life and death.
___________________________________________

Aye. AKA “learning the hard way”. I’ll be voting Wynne next year, and Trudeau/Jagmeet the year after as my humble offer to gently teach my fellow Canadians about how the wages of stupidity is a broke government, and an all out frontal assault on your financial wellbeing by the government as they attempt to regain solvency without making any concessions.

Think our collective leadership will reduce public hires? Reduce, or even just freeze public wages? Eliminate gold plated DB pensions – or even just acknowledging that their current path is unsustainable?

C’mon, we all know this will never happen. Much, MUCH easier to give them whatever they want and just raise taxes and fees. Even so, we also know that if another Mike Harris rose to power and promised to make big changes in the Public service, he’d get voted into oblivion.

Voting Trudeau in with a majority confirmed what I suspected for a while: that is that a new breed of Canadians coming on-line have a lot to learn yet about Canadian Politics.

That is why I offer to teach them, but not before I start insulating myself from the tax/fee fallout. I’m well along already, and have high hopes for some pretty rare and amazing successes on this front by the close of 2018.

#98 NoName on 12.12.17 at 10:06 am

Kid:
dad can I have 1btc for my birthday?
Dad:
What, you want 15,854??? 14,285 is lots of money! Why do you need 16,578 anyways?

#99 Ubul on 12.12.17 at 10:07 am

#92 Howard on 12.12.17 at 8:43 am
Why no discussion ever of oil on this blog? WTI looks set to break the all-important $60 USD level.

Canadian oil stocks still in the dumpster but to me that represents an opportunity. Companies with clean balance sheets (ATH and TOG come to mind) should eventually react nicely to rising oil, particularly once Q4 results are released.

Is value investing/trading completely dead?

……

It is up to you. If you believe that your take on it is right, do you need validation?

#100 Alistair McLaughlin on 12.12.17 at 10:16 am

@ #69, if you’re hitting your max balance anytime during the month, then that card does not have a high enough limit to suit your needs. Expand your limit, then the overage fee vs. blocked transaction becomes moot.

#101 Good grief on 12.12.17 at 10:42 am

Chronically low interest rates and govt policy to fuel the housing sector it was Sickly obvious that real estate was the place to be

Stubborn Relics , like Garth were prematerly calling for a crisis in 2011. How many people did he lead down the wrong path. Keep in mind he’s written BOOKS on real estate , lol, true story

Today- rates are rising and govt policy set to Deter housing sector

The game isn’t hard

#102 Glengarry Girl on 12.12.17 at 10:44 am

This blog is interesting and I do enjoy reading the comments section. It’s interesting to me what people think the current situation is. However it’s human nature to be positive for what you are invested in. You look for news and data that substantiate your beliefs. I think we are completely in uncharted territory. I also believe that a lot of the data is not reliable to make predictions. The printing of money and the leverage of debt has distorted reality. I know that this blog is pro investments that are linked to the idea that the economy is in growth. It also believes that there will be a major correction in the housing indusrtry. It certainly looks like that should have happened for years now. This blog promotes investments as though they would not be severely pulled down by a housing correction. This is a time, in my opinion to sit on the sideline. It’s too volatile and the good time to invest would be after the correction.

#103 TurnerNation on 12.12.17 at 10:54 am

World class Toronto again. As I’ve said for a while now here that we have a de-facto One-Child policy. (See: Communist China.)

Here it is in writing:

https://www.thestar.com/news/gta/2017/12/12/child-care-fee-hikes-outpace-inflation-with-toronto-parents-hardest-hit.html

“At that price, the couple isn’t sure they can afford to have a second child, even though Charlie will be entering junior kindergarten next fall.”

I’m sure it’s all by accident though!

Hey look at this map, pay close attention to global policy and where we are. Again accidential I’m sure, not planned out.

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

#104 David on 12.12.17 at 10:56 am

Buy the United States. Buy US Dollars.
Avoid Canada or at least reduce exposure to Canada for the next couple of years. There will be downward pressure on the CDN Dollar combined with deficits and foolish, anti-growth policies federally and in the majority of the provinces.

#105 Site C on 12.12.17 at 10:57 am

#74 acdel

I hodl btc and eth.
I really think energy plants and btc match well.
Some regions have negative energy price.
E.g Germany at times.
Use energy and YOU get paid by power supplier.
On top if that, you mine, double profit.

Look it up: negative electricity prices.

#106 Ace Goodheart on 12.12.17 at 11:25 am

RE: #75 Zachary on 12.11.17 at 11:49 pm

“To all those privileged feminists from downtown Toronto who accused the Host of “misogyny” because of that Dog reading a book pic”

The host (whether he knew it or not) was actually using a literary form known as a “beast fable”.

The idea behind this particular type of expression is very simple. It’s a dog, and a female dog is referred to as a bitch, so in the situation where you are dealing with animals, it is perfectly fine to have a male dog reading a book about bitches.

The trick is that dogs don’t read books.

So if you use animals instead of people, you can get away with a lot more stuff.

There is a very famous comedian who uses this technique with puppets. He is not “saying” anything, the puppet said it. Puppets can say a lot more than people can, without getting into trouble.

So he did not break any rules with his picture. Dogs can read those kinds of books. It’s perfectly fine. For a dog…

#107 TheDood on 12.12.17 at 11:39 am

#20 Thoughts? on 12.11.17 at 7:35 pm
__________________________________________
The key words “drained her savings account” were all I needed to hear. In my opinion, a colossal blunder on your friend’s part. So now she has a real estate asset with no monetary asset. She’s joined the ranks of millions of others – owns the roof over her head but otherwise doesn’t have a pot to piss in. What’s worse here is her age (45) doesn’t give her a whole lot more time to recover the savings. She’s joined the ranks of countless others who will retire poor.

#108 Howard on 12.12.17 at 11:46 am

#99 Ubul on 12.12.17 at 10:07 am

It is up to you. If you believe that your take on it is right, do you need validation?

—————————————

Since when does soliciting other opinions equate to needing validation?

I don’t know whether I’m right. I’m a value investor at heart but I sense that such a strategy is still years away from being the right one, what with the markets chasing profitless behemoths and now a bunch of fin-tech companies with negative book value.

#109 Mike in Edm on 12.12.17 at 12:07 pm

I’m surprised (and saddened) at just how bad the couple of interest rates is (seemingly?) affecting people here in Edmonton. Made some donations today to the local Christmas charities and they are FAR from their goals. 25% for the Christmas Bureau, 69% for Santa’s Anonymous, and 11% for Adopt A Teen.

Things are picking up here very slightly, but it’s definitely not like Notley would like everyone to believe. I really think the increased interest rates are making people really cut back. I recently had a chat with a good friend that works at a car shop, and he said that discretionary/ hot rod parts sales are ZERO right now. Cars still break down, so they’re busy, but nothing other than maintenance. I couldn’t figure it out and he’s actually the one that figures it’s because of interest rates.

#110 One Price No Tax Shown, Please help me Garth on 12.12.17 at 12:13 pm

Garth its my understanding that Ontario MPP Yvan Baker from Etobicoke Ontario has a private members bill to hide taxes in the prices of all goods sold in Ontario, I tried to find the Bill but the Bureaucratic Bull hides it and I just cant find it.

Your the best!

Thanks Garth

#111 T on 12.12.17 at 12:23 pm

#95 Mattl on 12.12.17 at 9:39 am

If you are going to contradict someone provide some data. Flop is providing data, you are providing useless and unfounded statements.

Flop is doing a public service. Many of us appreciate it immensely.

Thanks flop!

#112 Bitcoin is for bitminds on 12.12.17 at 12:28 pm

Think about it.

I personally know several people who greatly increased their helocs and blew it all into bitcoin in the past 2 weeks.

I would not consider any of them the brightest stars in the sky.

The herd is strong on this one.

#113 One Price No Tax Shown, Please help me Garth on 12.12.17 at 12:33 pm

BTW Garth I did find this tho…

Tax Fairness for Realtors Act, 2017

http://www.ontla.on.ca/web/bills/bills_detail.do?locale=en&Intranet=&BillID=4615

#114 heloc on 12.12.17 at 12:44 pm

#112
I personally know several people who greatly increased their helocs and blew it all into bitcoin in the past 2 weeks.

And as irrational that may have been, so far, they have made the best choice w.r.t their net worth.

Some will end up burnt, but some will make out like bandits.
I’m sure some HELOC money went into btc when it was still $300,- per coin.
Those mortgages are firmly paid off now, 10 times over.

Dunno… 21M coins.
Eventually half of them will be lost on forgotten wallets, harddisks on the garbage dump, etc.
Those 10M left over coins are awfully scarce when you consider the pool of people that may want one of those. There are 7.4B people on this planet. Did you get yours?

#115 Simplyput7 on 12.12.17 at 12:44 pm

But don’t confuse a house with an investment. That would be so 2016.

———————————

I’m so happy that speculating in the housing market is now a thing of the past, I want this mania in Bitcoin and cryptocurrencies to continue for another 24 months. That way housing can go back to primary homeowners and real investors who want to become landlords instead of people hoarding concrete boxes and houses for short-term financial gain.

I think I should help:

Bitcoin is the new gold, the returns on bitcoin are bigger than any speculator could have made in the housing market in Toronto or Vancouver.

For all of you individual syndicated mortgage lenders, you gave money to people who the banks didn’t even want to lend money to. Seriously, banks love nothing more than for you to be in debt forever; if they don’t want to give money to these people – you should have taken the hint, and waited to invest in Bitcoin. Look how much money you would have made if you invested all of that money you gave to sub-prime borrowers into Bitcoin. Are you even making 7% on people who will probably not pay back your principal investment?

You condo loving speculators are going to find out the real cost of your small concrete box, after mortgage rate increases, monthly maintenance fees going north of $500 (some places are over $1,000 in Toronto), property taxes and dealing with draconian condo by-laws. When you add up all of your monthly expenses and freedom you gave up to comply with condo laws, you will find out you could have owned a freehold townhouse for the same price. On the bright side you will be the fittest person out of all your friends and families as the elevators in your building are broken so often that you can cancel your gym membership and become a professional stair climber.

To the people who left their good paying job to become real estate agents. You had a few great years, but now the frenzy is over, some of you were honest, many in your industry lied and people trust you less than a used car sales person. What happened to the bidding wars? Where are the foreign investors and immigrants to buy your clients’ home for over asking? You gave up your career to deal with greedy homeowners who want to list their home for asking prices not seen since the peak in March 2017. Why? Didn’t you see the next new “it” investment on the horizon? You could be retired and living off of your Bitcoin profits. Now you are invested in a debt ridden industry that is very challenging to survive in when home prices are going down. You could have been at home with your family, instead of working evenings, nights and weekends for half the pay your old 9-to-5 job was paying.

Speculators, you hoarded homes like gold coins and now they will be subject to B-20 regulation, if you think your bank will continue to give you low rates when they don’t have to think again.

Dump your speculative houses, pay CRA (before they find you) and invest in Bitcoin before it hits $50,000.

Bitcoin is the future, now is the time to buy.

#116 Stan Brooks on 12.12.17 at 12:45 pm

All #4 akashic record on 12.11.17 at 6:53 pm
Yeah, it’s not Bitcoin. But a balanced, low-vol, diversified, 60/40 portfolio has handed investors close to 10% this year. And it was 8.5% last year.

—-

That’s for sure.

Bitcoin has handed risk takers a growth from USD752 to USD17K this year.

I hope nobody lost their shirt by shorting it when it became available yesterday, just to smooth the pain of FOMO.

—————————————

– Desire to get something in exchange of nothing.
– Need to prove to be smarter than others and more successful./vs loser.
– FOMO – Fear of Missing Out.

All lethal sins IF YOU DON’T GET OUT ON TIME.

For bitcoin and crypto-currencies the time is now/ in the next month or two, maybe year or two.

Total failure of authorities to regulate crypto-currencies.

Looking at T2 and wild bill and you know why.

But the day of reconciling is apprpoaching fast both
for cryptos and the Canadian housing market and economy.

Got delays but does not forget.
Amen.

#117 Stan Brooks on 12.12.17 at 12:46 pm

God delays but does not forget.

Amen.

#118 Stan Brooks on 12.12.17 at 12:49 pm

But the day of reckoning is approaching fast both
for cryptos and the Canadian housing market and economy.
————————
damn spellchecker.

#119 Stan Brooks on 12.12.17 at 12:56 pm

No inflation Eh?

https://ca.finance.yahoo.com/news/cost-child-care-20-cities-100000294.html

Bhahahaha

#120 Ace Goodheart on 12.12.17 at 1:00 pm

Re: #7 Ronaldo on 12.11.17 at 7:01 pm

Mortgaged your house yet?

https://www.investopedia.com/news/people-are-mortgaging-their-houses-buy-bitcoin/?partner=YahooSA&yptr=yahoo

This is going to end really badly. Bitcoin is a clear asset bubble. At this point it has probably had its run and people buying it now are just the biggest idiots who are allowing the fools beneath them to cash out.

The next one in the line is LTC. Going up by 100% a week right now as fool after fool rushes in to grab some. Again, people who bought on the ground floor last year will make out like bandits while those rushing in will likely get burned as the biggest idiots.

At some point people are going to realize just how easy it is to create a crypto currency. It is just a math problem that gets more complicated the more “miners” pile into it. When bitcoin first came out kids were mining coins on their lap tops. And remember these were 2000’s era laptops, many of them five years old or more (kids can’t afford brand new computers). Now you need a specialized mining computer.

Oh well.

People need to remember, money CAN buy you happiness. It totally makes you very happy. The more the better. But houses, crypto coins, investments that do not produce a steady rate of return, investments that have to be sold before you can get a return on them, and most importantly debt, do not equate with happiness. These things make you unhappy.

Money buys happiness when properly invested. The more you have properly invested, the happier you will be.

#121 Dups on 12.12.17 at 1:01 pm

Did you know that the from the worlds total number of patents, 30% of them are expiring this year 2017. This would lead to more companies making me too products. Think about this for a bit. We are in for a very long profitable and competitive bull market.

#122 I’m stupid on 12.12.17 at 1:07 pm

Bitcoiners have become as annoying as Jehovah witnesses. Give it a break none of us care.

#123 Ace Goodheart on 12.12.17 at 1:23 pm

Here’s an interesting fact: Most bitcoin which is currently in existence is owned by the person or group of people who originally created it. There are estimated to be over 1,000,000.00 bitcoins owned by this person or people.

Bitcoin is currently valued at around $18,000 US dollars per coin.

18,000.00 times 1,000,000.00 turns out to be a very large number: 18,000,000,000

Of course this does not mean that the founder of bitcoin is actually worth 18 billion dollars. What it means is that supply of this coin is intentionally limited, creating an artificial bubble and artificial demand. If this person actually tried to sell his or her 18,000,000,000 worth of bitcoin, the market would immediately crash and the coins would likely be worth pennies each, or less.

#124 Damifino on 12.12.17 at 1:39 pm

Sunny ways, bright as ever. Disappointing.

#125 Stan Brooks on 12.12.17 at 1:40 pm

#120 Ace Goodheart on 12.12.17 at 1:00 pm

People need to remember, money CAN buy you happiness.,
————————–
It surely does.

The bottle of Chivas proves it.
Cheers!

#126 SoggyShorts on 12.12.17 at 1:47 pm

#83 AGuyInVancouver on 12.12.17 at 2:57 am
#28 crowdedelevatorfartz on 12.11.17 at 7:59 pm
@#20 Thoughts
Nobody who has been renting the same place in Vancouver for more than 5 years is going to move. T do so means you will be playing way way more in rent, and you’ll be competing with a horde of eager renters for each place.

In short, unless your family situation changes drastically you’d be a fool to give up a decent rental in YVR.
**********************************
I still don’t get why people are so attached to the city they live in. If I was living in a place that is in the top 1% of most expensive cities, but wasn’t making top 1% income, I’d be constantly looking to move. Most jobs exist in more than 1 place, and even if you take a hit in salary, if your cost of living goes down by a lot more, doesn’t it make sense?
Granted I’ve only visited and never lived in Van, maybe there’s a rainbow everyday and unicorns on every street, but if not then one of the other dozen cities might do just as well.

On another note, is a 45m commute considered good? It sounds awful to me. She makes $32/h but spends 2h in transit(assuming the train stations aren’t inside her house/work) The way I look at that is paying $60/d to work.

#127 Stan Brooks on 12.12.17 at 1:51 pm

The bottle of Chivas is worth exactly 0.002 bitcoins!

something really worth investing in!

#128 Stan Brooks on 12.12.17 at 2:01 pm

#126 SoggyShorts on 12.12.17 at 1:47 pm

**********************************
I still don’t get why people are so attached to the city they live in. If I was living in a place that is in the top 1% of most expensive cities, but wasn’t making top 1% income, I’d be constantly looking to move. Most jobs exist in more than 1 place, and even if you take a hit in salary, if your cost of living goes down by a lot more, doesn’t it make sense?
Granted I’ve only visited and never lived in Van, maybe there’s a rainbow everyday and unicorns on every street, but if not then one of the other dozen cities might do just as well.

On another note, is a 45m commute considered good? It sounds awful to me. She makes $32/h but spends 2h in transit(assuming the train stations aren’t inside her house/work) The way I look at that is paying $60/d to work.

———————————-

You are raising interesting question:

Why do the mentally challenged love the mental institution that is their permanent home and refuse to live the real life out there?

Ever watched The Truman show? Not everyine is Truman.

Most are:

-lazy/stupid/settled/stupid/feeling superior/stupid/unable to cope with change/stupid/brainwashed/stupid/brain-frozen/stupid.

BTW average commute in GTA is 2+ hours one way to/from work.

#129 Ace Goodheart on 12.12.17 at 2:07 pm

RE: #127 Stan Brooks on 12.12.17 at 1:51 pm

“The bottle of Chivas is worth exactly 0.002 bitcoins!

something really worth investing in!”

I remember a few years back waiting in the departure lounge at Pearson for a flight out to Cuba (two weeks of beach lounging, complete with servants running back and forth with my drink of choice, on my command).

The airport duty free had its selection of expensive hard liquor. Stuff like $1000.00 bottles of Scotch and the like.

I was admiring a particularly tasty looking 40 year old example, when I was surprised by a very attractive young lady who approached me with a tray full of little cups.

Turns out she worked there. The duty free had just decided (for reasons still unknown to me) to crack open a $1200.00 bottle of Scotch whisky and offer samples to anyone who wanted one.

I must have had about four of them. I kept coming back. The store was mostly empty (not a lot of flights leaving at that time) and it was early in the AM so she did not have many takers.

Your comment reminded me of that day for some reason. That was a very good morning, indeed.

#130 S.Bby on 12.12.17 at 2:15 pm

#95 Mattl on 12.12.17 at 9:39 am

have you looked at myrealtycheck lately?

https://myrealtycheck.ca/

#131 down_boy on 12.12.17 at 2:26 pm

#122 I’m stupid on 12.12.17 at 1:07 pm
Bitcoiners have become as annoying as Jehovah witnesses. Give it a break none of us…

bought. Only a real bigot with an irrational hatred would draw a simile to an innocent group. If you don’t like alternative currencies, go back to AM radio. This is a blog on economics, real estate, money, and the road ahead.

#132 SimplyPut7 on 12.12.17 at 2:29 pm

#122 I’m stupid on 12.12.17 at 1:07 pm

No, Bitcoin is the new housing market. Look at all of you housing speculators, price of Bitcoin has surpassed anything you could have made giving money to sub-prime borrowers.

Don’t let this opportunity pass you, you will never be able to get in again. Buy now before it’s too late.

http://fortune.com/2017/12/12/bitcoin-historical-investment-values/

#133 Mattl on 12.12.17 at 2:32 pm

#111 – the plural of anecdote is not data. What would posting green pumpkin report prove? Nothing, of course, posting homes in Maple Ridge going for big numbers only proves that some homes in Maple Ridge are going for big numbers. Cherry picking a small – miniscule sample of sales – and trying to extrapolate market direction is the definition of ignorance.

If you want to understand how the OVERALL yvr market is performing go here:

http://www.rebgv.org/sites/default/files/REBGV-Stats-Pkg-November-2017.pdf

You can hate Realtors, but this data is pretty good. If you ignore the press marketing release and focus on the data you get a good picture of what is happening. For instance, markets in Richmond, Burnaby and West Van are soft. Little to now growth the last 6 months. So ya, bad buys and quick flips will equal losses. We don’t need an endless stream of reports, all of the data is being captured and reported on. When the market really turns, and it will, this will show up in the RE board numbers. There is no hiding it – see what happened in the GTA the past 6 months.

And the existing yvr data shows that most markets are up yoy double digits, and up insane numbers the past 3 years. Markets like Maple Ridge are flat out insane. There are no deals….yet. A house selling for 50 percent more then 2013 but 2% less than spring 2017 is not a deal. Don’t believe me, hit some open houses in YVR and see of you can snag a place for 2015 prices. Let me know how that goes.

#134 Rainclouds on 12.12.17 at 2:38 pm

One would presume that the Huffington fish wrapper isn’t beholding to RE advert $ given they seem to be the only ones reporting this rather interesting development……………

http://www.huffingtonpost.ca/2017/12/12/statscan-to-unveil-foreign-investor-data-on-toronto-vancouver-housing-markets_a_23304679/?utm_hp_ref=ca-homepage

#135 down_boy on 12.12.17 at 2:43 pm

Litecoin has spiked. Others have followed. Charlie Lee, creator of Litecoin, warned Ltc holders yesterday, in a tweet, not to get too exhuberant. He wrote if you are not prepared for the price to drop back down to $20, then you should not be holding Litecoin. He predicts an extended bear market for alt currencies in the future before they recover. This maybe a disclaimer to hedge his promotional activities earlier this quarter. Currently, Ltc at $416 CAD

#136 Lost...but not leased on 12.12.17 at 2:51 pm

Bre-X vs BITCOiN

People using heloc to invest in BITCOiN ?!?!!!

There are a few documentaries re: 1990’s Bre-X scam.

One geologist was able to convince the planet of a major gold find( which was later proven to be his shaving gold from a ring into core samples).

People’s cognitive reasoning shut down and normal due diligence was ignored. We know it did not end well, but regardless the issue was fairly linear..either(i) the claims were true or(ii) not true ,(which was exposed when the claims were subjected to proper scrutiny)

re BITCOiN…There are likely numerous individuals and groups who are assessing the mass psychology of BITCOiN “mining” ie data and patterns etc. to apply to the next big hyped investment.
We have some camps who view BITCOiN under certain lenses ( tunnel vision ) as “different from the rest”…ie infallible,sky is the limit…ad nauseum blah blah.

Many others simply snicker at what may become a bigger scandal then Bre-X. BITCOiN has simply been able to “red herring” its trail and likely tapped into a demographic( of those who actually understand the technology involved, but don’t have the sober old school reasoning of what may be a scam on par with Bre-X.

BITCOiN seems to fill that psychological void of classic “get rich quick” left when historical avenues of Real Estate, Precious Metals and Stock market do not attract certain groups…but still relies on blind faith with a dose of 1/2 truths.

#137 it burns on 12.12.17 at 3:19 pm

Another shout out to the time flop is spending to paint the true picture.

All I do now is hit control f and search “flop” and forget the rest of the posts.

Thanks!!!

#138 AGuyInVancouver on 12.12.17 at 3:22 pm

#4 akashic record on 12.11.17 at 6:53 pm
Yeah, it’s not Bitcoin. But a balanced, low-vol, diversified, 60/40 portfolio has handed investors close to 10% this year. And it was 8.5% last year.

—-

That’s for sure.

Bitcoin has handed risk takers a growth from USD752 to USD17K this year.

I hope nobody lost their shirt by shorting it when it became available yesterday, just to smooth the pain of FOMO.
_ _ _

Virginia Woolf must have had Bitcoin in mind when she said “There’s no there there”.

Seriously, there is nothing backing this, it’s all just get rich quick and get out before it blows up. At least with real estate you’d still have that patch of ground you bought, or with gold, metal you could make something with.

#139 SimplyPut7 on 12.12.17 at 3:29 pm

#7 Ronaldo on 12.11.17 at 7:01 pm
#120 Ace Goodheart on 12.12.17 at 1:00 pm

I think this story is as believable as the foreign investors with the suitcase full of money to buy homes in Toronto and Vancouver.

I tried to search for that story online, couldn’t find an article mentioning the suitcase buyers from faraway lands.

This is the close thing I found (below). Were people that delusional in the housing craze in Canada? This story originated from somewhere, I heard about it so many times.

http://bc.ctvnews.ca/how-to-win-a-real-estate-bidding-war-in-metro-vancouver-1.2804164

#140 TnT on 12.12.17 at 3:48 pm

#123 Ace Goodheart on 12.12.17 at 1:23 pm

If this person actually tried to sell his or her 18,000,000,000 worth of bitcoin, the market would immediately crash and the coins would likely be worth pennies each, or less.

The current Exchanges that process Bitcoin to USD cannot and will not facilitate the exodus to hard US Cash.

This is why the Futures Market was put in place and is currently setting up the greatest Ponzi scheme ever.

The heavy insiders will cash out through the Futures Market while the rest of the suckers are left with 404 errors trying to cash out through the current exchanges.

Tragedy in the making…..

#141 Correlation on 12.12.17 at 4:04 pm

Correlation is a beautiful thing:
https://pbs.twimg.com/media/DQ3oPpJVwAAeVxo.jpg
(tomorrow will add another data point to that.)

#142 Newcomer on 12.12.17 at 4:22 pm

#102 Glengarry Girl on 12.12.17 at 10:44 am

This is a time, in my opinion to sit on the sideline. It’s too volatile and the good time to invest would be after the correction.
———-

Here’s a thing though. With all that debt and stimulus it would be pretty unremarkable if we got inflation. If you are on the sidelines while inflation is running its course, you are losing money like a debtor paying interest. Every day you are a little worse off. Sitting on cash in an environment where everyone and his sister is pulling for inflation is too risky.

#143 I’m stupid on 12.12.17 at 4:26 pm

#131 down boy
#132 simply put

I couldn’t careless if bitcoin went to a billion. It wouldn’t affect my life one bit. I won’t be buying today or ever. This passion you have to defend bitcoin should tell you something. I own equities I don’t need to defend them or pump them. Why does the entire bitcoin community feel the need to promote it? I should promote it too, hopefully it creates a massive buying opportunity for actual income producing assets.
Lesson 1 always be a seller when everyone wants to buy. Lesson 2 always be a buyer when everyone wants to sell.
Lesson 3 you never get anything for nothing
Lesson 4 beware of people trying to sell you an investment

Bitcoin fails all those lessons. You may be right, or you maybe wrong but one things for sure, I don’t care.

#144 down_boy on 12.12.17 at 4:43 pm

#138 AGuyInVancouver

“Seriously, there is nothing backing this, it’s all just get rich quick and get out before it blows up. At least with real estate you’d still have that patch of ground you bought, or with gold, metal you could make something with.”

Ampex (gold) accepts bitcoin and ships to Canada. Orders are processed in 15mins. I tested the process as an exit strategy. I believe… you can’t own land in Canada. I read it in a law somewhere. Freehold is as close as you get. Squatters on unsurveyed rural parcels can have a greater claim than their property tax paying civic brothers. Search “Peace River Valley”.

I hold title to a large tract of ecological preserve with a lab tested and proven source of pristine water and the rights to bottle it. I also hold timber rights and 100 years of banked property tax. Cryptos are fun, innovative, and a grand experiment. Dip $50 into it, learn how a wallet works and how to transact. Or ignore it. I bought some so I could learn how it worked, and what the limitations are. I don’t care if it goes up or down, but it would be fun if they succeed. Now I know enough to neither endorse nor discredit bitcoin. It’s a shared pool of value based on your faith in fellow participants. I’ve spent more on well holes than bitcoin.

#145 45north on 12.12.17 at 4:45 pm

nick: So people won’t fail the stress test if they bought 5 years ago. Not only that, if they stay with their current banks they don’t have to do the stress test, but they will have to eat whatever rate they are fed by their current lender. So the people who will have a tough time are those who had 1-3 year terms, especially those who bought last year.

so now is the best time to put in the stress test? The timing decided by a myriad of sql queries against a mortgage database?

#146 Maggie the Tech Writer on 12.12.17 at 4:57 pm

#138
Virginia Woolf didn’t say it. It was Gertrude Stein.

#147 down_boy on 12.12.17 at 5:00 pm

#143 I’m stupid on 12.12.17 at 4:26 pm

“I couldn’t careless if bitcoin went to a billion. It wouldn’t affect my life one bit. I won’t be buying today or ever. This passion you have to defend bitcoin should tell you something. I own equities I don’t need to defend them or pump them. Why does the entire bitcoin community feel the need to promote it?”

Because it’s new and fresh and glimmer of positive in a world with tragic news headlines. If bitcoin holders can convince others, then maybe they guessed right. I don’t dis anybody because they are enthusiastic. In two months it will be boring again.

#148 Mattl on 12.12.17 at 5:05 pm

S.Bby – looks like lots of small changes to price. Clearly sellers were trying to get ahead of the market, which isn’t growing at 25% anymore, and are adjusting down to reach market. I guess I don’t find ask prices that interesting in a market as fluid as RE. For years homes sold over ask, that couldn’t last forever. And homes are still selling, there was lots of action in November, numbers were way up over PY and the large majority of homes are selling for more then comps PY.

But ya, asking prices are down.

#149 down_boy on 12.12.17 at 5:16 pm

#144 down_boy on 12.12.17 at 4:43 pm

Correction…

“I believe… you can’t own land in Canada. I read it in a law somewhere. Freehold is as close as you get. ”

Mining rights are better, because you get to pack a six shooter.
See PAL, Restricted Use.

#150 Willy H on 12.12.17 at 5:57 pm

The Trump Administration’s tax cuts are pure fiscal fantasy. Some lawmakers are having second thoughts and there will be political fallout for program cuts for students and medicaid.

They are likely to pass because the GOP is desperate for a legislative accomplishment. They will leave a gaping $1.5T hole in government coffers.

This is 1980’s failed neo-con policy re-hashed. It’s increased stimulus, blunt and most certainly ineffective in the long-term, when the US economy doesn’t need it.

Yes, there will be a stock market bump and it will end well for some investors and the wealthy, the middle class, as usual, not so much!

#151 TheDood on 12.12.17 at 6:19 pm

#133 Mattl on 12.12.17 at 2:32 pm
__________________________________

……Don’t believe me, hit some open houses in YVR and see of you can snag a place for 2015 prices. Let me know how that goes.
__________________________________

The only people currently buying RE in the YVR area are the dumbest of the dumb. The huge run-up in housing took place over many years. The landing could take that long as well. Or not. Give the new stress test 6 months to do it’s work, add a rate hike or two. 2015 (or before) prices will surely be visible during some point in 2018.

At the end of the day, most YVR homeowners are in lifelong debt because of RE. If they’re in position to ride out the coming storm, good on them. If not, good on them also.

#152 BobC on 12.12.17 at 8:43 pm

Ive been reading about all the money T2 gives away but I’m stumped on this one. Anybody know why he gave $10 million to Omar Khadr? Isn’t that guy a terrorist?
Also on real estate, when someone brings money in from another country and pays a stupid high price doesn’t it help when the bubble pops? They gave their loss to a selling citizen and it stays in Canada.

#153 Ronaldo on 12.12.17 at 8:48 pm

#140 TnT on 12.12.17 at 3:48 pm

#123 Ace Goodheart on 12.12.17 at 1:23 pm

The heavy insiders will cash out through the Futures Market while the rest of the suckers are left with 404 errors trying to cash out through the current exchanges.

Tragedy in the making…..
——————————————————-
Absolutely. The sheep are in for a really good fleecing when their futures contracts expire worthless. The same game will be played as is being played in the PM market.

#154 dienekes on 12.12.17 at 10:43 pm

Where are these jobs
Sask Construction Association – usually 140 tenders posted, it has been below 100 all year finally rising to 106.
Winnipeg Construction Association – usually 160 tenders posted. There are 96 right now and have been under 110 all year.
Crap jobs posted, many overlapping posted on both associations. Alberta has same dismal numbers. BC sucks as well.
Where the hell are these jobs. Polishing Trudeau places from degenerate organizations?
Should start a LBGT Construction Association, Trudeau will be falling all over himself giving it money while oiling up his hair for a picture

#155 45north on 12.13.17 at 12:27 pm

That’s when StatsCan releases new numbers on foreign ownership levels in the GTA and YVR – the result of Justin Trudeau spending $40 million on a project to measure market activity.

I worked at StatsCan for 10 years.

Here’s an article on the Housing Statistical Framework. Some quotes:

Statistics Canada’s public partners include provincial governments, land title authorities and non-for-profit organizations. The private sources cannot be named as per their agreements with the government agency.

it used to be that StatsCan data was collected by StatsCan

another quote: The creation of the database will be facilitated by a National Property Register, which will keep tabs on every property in Canada, and information about their respective owners.

http://business.financialpost.com/personal-finance/mortgages-real-estate/massive-effort-underway-to-create-database-that-will-shed-light-on-canadas-housing-market

“a National Property Register” it seems will be developed by StatsCan:

The team will use existing census records as well as private and public partner sources to fill in those gaps. The resulting National Property Register will have information on every property in Canada, as well as who owns them. StatsCan will then leverage that data to create hard numbers on foreign buyers, average home prices, mortgage holders, vacant homes, and more.

https://www.zoocasa.com/blog/real-foreign-buyer-data-a-toronto-buyers-market-and-banning-double-ending-weekly-real-estate-news-recap/

Revenue Canada shares data with StatsCan but not the other way around but Revenue Canada needs the data to check rental income. I’m thinking Revenue Canada has to develop its own database. Which seems like an added expense.

It also seems that not only does StatsCan have to navigate its way through provincial governments and agencies such as BC Assessment and MPAC, unnamed private sources but it must also navigate the Federal Government:

As the service provider for the Government of Canada’s Open Government portal, Statistics Canada is increasing the public’s access to government information by making its own data available on the portal and by making the portal easier for Canadians to use.

https://www.statcan.gc.ca/eng/about/dp/2017-2018/s07

you got to realize that the Open Government Portal is a part of Shared Services which is just a bureaucratic power grab – it adds nothing. Really nothing – I mentioned the conflict in mandate between Revenue Canada and Statistics Canada, Shared Services adds absolutely nothing to resolve this conflict.

#156 Arne on 12.14.17 at 9:34 am

“Yeah, it’s not Bitcoin.”

LOL, how would you know?