What could go wrong?

Last year over 65% of the money the Big Maroon Bank with The Penguins made on all its retail operations came from – you guessed it – mortgages. But this spring there’s a been a deep, almost shocking, reversal. Listen to what Christina Kramer, head of CIBC’s retail banking, told analysts on a conference call Wednesday:

“We expect there to be an origination decline in the 50 per cent range relative to the same period last year. A year ago, two-thirds of our revenue would be related to our mortgage business and today that’s about a quarter.”

The ‘origination decline’ she’s talking about relates to mortgage volumes, as the bank expects the number of new home loans to plummet by 50%. That was enough to shove bank stock down 1.5%, but shares in CIBC (at $115) are still not far off their high of $123. Kramer’s colleagues were quick to point out that while the mortgage business sucks large right now, other things have perked up – like deposits. What a difference a little bit of extra interest makes, as the risk-averse and timorous listen to [email protected] and plow savings into those brain-dead GICs. It’s amazing how many people become aroused when they can make more than 2%.

So will housing whack the banks? Some people think so. The Big Short guy made some headlines the other day telling investors Canadian financial institutions were ripe for a tumble as the real estate market continues to wobble and possibly fall over. This is a uniquely American view, and based on experience there. As you know, the yanks securitized dodgy mortgages, turning them into AAA-rated investment assets that Wall Street harpies sold to unsuspecting clients. (“Hey, they’re residential mortgages? What could possibly go wrong?”)

The US housing crisis turned quickly into a credit crisis as investment and retail banks swooned when a wave of mortgage defaults turned the blue-chip assets into dung. Wall Street institutions failed and Washington spent (literally) trillions trying to revive the economy and restore faith in the financial system.

So through that lens, Canada looks pretty bad right now. Households owe more money than the size of the entire economy (over $2.1 trillion), 60% of which is in the form of mortgages on houses that may have tripled in value in the past few years. Classic bubble, based on loose credit and cheap rates. Real estate has soared. Incomes have not. So debt has soaked up the difference.

Meanwhile we’ve allowed real estate and related activity to constitute almost a quarter of the whole economy, more than manufacturing and oil put together. With interest rates now rising and serious new credit controls reducing mortgage activity (as the CIBC just revealed), it appears Canada’s banks are sitting with massive exposure to an asset class that can only tumble.

But what about mortgage insurance? Doesn’t Canada has in place a regime that will instantly protect the banks if homeowners started mailing back their keys? Yes, we do, and CHMC stands behind about $600 billion in mortgages. But that’s less than a third of the home loan debt outstanding, and does not take into consideration another $320 billion in HELOCs (40% of which aren’t being repaid).

More concerning is the whole reason we now have a stress test for new borrowers. Big numbers of moisters were getting around the old test in place for people with small down payments by scoring loans from the Bank of Mom. If they could plop down 20%, no test. So no mortgage insurance. No protection for the lender. And banks like CIBC found that while half their portfolios were uninsured, a large number of those borrowers might be sketchy. That’s why the bank regulator freaked, and now everybody has to prove their viability. Which is why mortgage borrowing just fell 50%.

Scary? Hmm, somewhat. Recall that when the credit crisis hit – created by the effects of American house lust – our bank stocks were mutilated. CIBC shares, for example, traveled from more than $100 down to about $40 – a collapse of 58%. Of course, during it all the bank continued to be profitable, and never cut its dividend payment to shareholders. This also proved to be one fat momma of an opportunity, since the bank’s stock has since risen by 175%. Those who know money is best made when the gutters flow red, cleaned up. Some things never change.

So this particular bank has over $200 billion in mortgages, which might concern you. But it also just announced an increase of 25% in quarterly profits, and is making money hand-over-fist. Like the other guys, Big Maroon has expanded its reach deep into the US, and reaps a harvest on everything from credit cards to insurance, wealth management to commercial banking and its retail deposit-taking, among other things. As I explained the other day, the banks want to now be seen as technology companies who have financial operations. Someday there will be no more CIBC branches, as credit replaces cash.

Sure, if this housing market thing comes unglued, investors might panic sell off the banks as they shed perceived risk. That could take much of Bay Street down with it (financials make up 34% of the equity market). In that case, back up the truck. I’ll drive.

200 comments ↓

#1 NoName on 05.23.18 at 5:44 pm

interesting read

https://www.bloomberg.com/news/articles/2018-05-23/u-s-says-china-employee-hit-with-sound-sensations-brain-injury

#2 Honey Dripper on 05.23.18 at 5:47 pm

“If you want to buy stocks, why would you want the price to go up?” – Warren Buffett

#3 Niagara Region on 05.23.18 at 5:51 pm

Key Dodd-Frank regulations have just been rolled back by the U.S. Congress, regulations put in place in after the financial crisis of 2008. Follow the link for more info: https://www.democracynow.org/2018/5/23/we_are_lurching_toward_plutocracy_rep

#4 FOUR FINGERS WATSON on 05.23.18 at 5:53 pm

Obvious conclusion……rates will be lower for longer.

#5 Doom Incarnate on 05.23.18 at 5:55 pm

Since I now apparently have twins on the way, I sure hope that real estate crash comes soon to my town so I can get a bigger place for the mewling babes in short order. The money’s in place. I just need the prices to meet my needs. Or I could rent a house. Or stay where I presently am in a too small paid off condo.

Hmmm…

#6 jess on 05.23.18 at 6:17 pm

In 1994, $3 million was enough to be considered ‘ultra-high net worth,’ said Peter Charrington, global head of Citi Private Bank.

‘Fast-forward almost 25 years, and $25 million is how we define ultra-high net worth,’ he said.

#7 young & foolish on 05.23.18 at 6:18 pm

If we are heading for higher rates, and we seem to be, then why are we expected to accept higher equity valuations? I’ve heard about growth, but with high debt loads and flat wages, where are the profits expected to come from?

#8 Lost....but not leased on 05.23.18 at 6:19 pm

Looking at todays “dog”photo…. I see proof that Marty Feldman was re-incarnated.

#9 jess on 05.23.18 at 6:19 pm

Belvedere Global Strategies Announces New Affiliations With Several …
http://www.marketwired.com/…/belvedere-global-strategies-announces-new-affiliations-with...

Apr 19, 2011 – … 2011) – Belvedere Global Strategies CEO, James Scott announced … Belvedere Global Strategies is a company founded by globalization …
A DC Think Tank Used Fake Social Media Accounts, A … – BuzzFeed
https://www.buzzfeed.com/…/icit-james-scott-think-tank-fake-twitter-youtube

May 15, 2018 – The day’s closing session featured James Scott, ICIT’s senior fellow and …. “James Scott, Founder and CEO of Belvedere Global Strategies,

#10 MSM-Free Zone on 05.23.18 at 6:20 pm

#4 Niagara Region on 05.23.18 at 5:51 pm
_________________________________

Indeed.

“…For far too long, far too many people in our country have struggled to make ends meet,” Rep. Jeb Hensarling, chairman of the House Financial Services Committee, said in a statement. “They’ve struggled to buy a car; they’ve struggled to buy a home; they’ve struggled for their version of the American dream…..”

“…But today, that changes….The bill’s passage marks the end of years of lobbying by the financial industry to soften post-crisis rules….”

That’s rich, really rich. Republicans feigning sympathy for the ‘struggling American’, when it was Republican deregulation that allowed the forever-lobbying Wall St. to blow its brains out in the first place, giving new meaning to the phrase ‘struggling American’.

What could possibly go wrong? v2.0

#11 Linda on 05.23.18 at 6:23 pm

The difference between 2008 & now is that any Canadian housing meltdown is highly unlikely to trigger a world wide financial crisis.

As for the stress test, if it keeps people from taking on more debt than they can handle is that a bad thing?

#12 Wrk.dover on 05.23.18 at 6:31 pm

Bernie Madoff was jailed they say….for this?

#13 ole Doberman on 05.23.18 at 6:34 pm

Gartho i already backed up the truck on bitcoin when it pulled back. Banks will become obsulete soon as crypos reign supreme.

#14 MSM-Free Zone on 05.23.18 at 6:35 pm

If you’re in your advanced years like me, nervously thinking ‘what could go wrong’, and want to keep your money safe from a future Trump/Republican GFC v2.0, the Maroon Bank of Penquinettes (The Simple One) is offering 2.75% CIC’s on a one year term, about 0.5% above the current inflation rate.

Seeing as equity markets are currently wallowing in their peak after a pretty good 10-year run, you get to sleep well, until you can buy in at the bottom again.

#15 Suede on 05.23.18 at 6:36 pm

when can we vulch the banks?

The prime + half HELOC is 3.95% (2.6% effective)

Bank Dividends are over 4%

In my day, that’s what we called a nice spread.

#16 Goldie on 05.23.18 at 6:38 pm

Hmm… I wonder if the public will be allowed a say when banks decide that they (the citizens) no longer have a right to physical cash.

#17 David on 05.23.18 at 6:41 pm

Comparisons to last year are pointless, no? We are in the process of reverting to the mean, as you have said countless times Garth. The fact that 2016 and 2017 were stupid in GTA doesn’t make the more sensible 2018 levels a crisis. Markets like Ottawa and Montreal are smoking hot and yoy comparisons are meaningful cause 3016 and 2017 were “normal” and weren’t peaks in a bubble and thus pointless comparators.

#18 Smartalox on 05.23.18 at 6:52 pm

The CIBC spokeswoman said that mortgage ORIGINATIONS are down 50% (actually, from 66% to 25%, seems like only a decline of 40 percentage points – should we be worried that the spokeswoman seems to be innumerate?), but you can be sure that the bank will be tightening the screws on the holders of all the current mortgages.

Cha-ching!

She said mortgage originations have dropped by half. The mortgage share of overall retail banking has declined from two-thirds to a quarter. I think she probably knows more than you. – Garth

#19 ANON on 05.23.18 at 6:56 pm

Someday there will be no more CIBC branches, as credit replaces cash.

Ha! That will be the day :)

#20 The Real Mark (not the imposter) on 05.23.18 at 6:59 pm

“#16 Suede on 05.23.18 at 6:36 pm

The prime + half HELOC is 3.95% (2.6% effective)”

Shop around, you can do way better than that. I’m paying a little over half that personally to borrow.

Seeing as equity markets are currently wallowing in their peak after a pretty good 10-year run, you get to sleep well, until you can buy in at the bottom again.

10 year run? Not in Canada. The TSX is only a few percent above its 2008 level. Still plenty of runaway ahead of it, especially since its trading at a trailing P/E of 16, and a ‘current’ P/E somewhere between 13 and 14.

#21 Rexx Rock on 05.23.18 at 7:06 pm

Thank God the BOC will not raise interests rates for many years to come because of our high debt.Inflation will be the killer but Canadians can tough it out because were used to high taxes and just budget around these incoviences.

#22 TurnerNation on 05.23.18 at 7:10 pm

Confirmed Orange Pinko sweep in ON. :(
Talking to people downtown with money and assets…they say no to BS D.F. and no to KFC spokesperson.

Leaves Cat Ladies and Soybois to vote in :(

Convert all $ to Gold Bricks, bury, then apply for free tuition, drug plan and health care, dental plan and govt assistance like Guaranteed Minimum Income.

For faster health care cross into USA, flush passport, and return with open arms. Front of line for housing and hospital care. Tell a good story. :(

The Kanadian way.

#23 Nonplused on 05.23.18 at 7:17 pm

Mortgage lending may be declining but consumer credit will not. Where does the government think the 99% are going to get the money to pay for their new carbon taxes, increased prices due to the $15 minimum wage, and various other new taxes on real estate and rising income taxes? The 99% already has too much month left at the end of their money, which is why consumer debt is where it is. This will only get worse unless we see some sort of drastic reduction in lifestyles across the board, which I doubt will happen until there is no other choice including debt.

Technology has been playing a role too. Sure we’ve seen discussion ad nauseam about how technology is replacing jobs, but it’s always don that. However it is also increasing living expenses. Who these days would even consider going without a cellular phone? And one for each of the kids too? That’s an extra $300 or so every month that you didn’t have to pay 15 years ago. And what about computers? it wasn’t that long ago, maybe 15 years, when people didn’t have computers in their homes unless they worked from home. That’s about when I got my first computer. Since them I’ve bought a new one about every 3 years because they aren’t designed to last much more than that. Sooner or later the hard drive goes and it isn’t worth replacing because the thing is too darn slow and Microsoft isn’t supporting the software anymore. And don’t forget that with the computer comes internet. More monthly fees.

Technology is also becoming irresistible. Anyone who has a 12 year old boy knows what happens when a new gaming counsel comes out. Why we need gaming counsels I don’t know because we already have 15 years worth of old computers which could already run the games if they were designed for that platform. that’s all a gaming counsel is really is just a specialized computer. They have a disk drive, internet connection, Netflix, play DVD’s, pretty much just a little computer. But if your kid wants to play the latest games he has to have the latest counsel. So now I’ve got a stack of old counsels beside my stack of old computers.

Or take what they’ve done to TV’s. Years ago I bought a 32″ TV at near the end of the tube era for $350. I thought it was pretty cool at the time, and they didn’t come much bigger unless you went to some sort of projection TV. It still works. But now everyone has a 55″ LED that cost $1,000. And cable. And I’ve also got about $700 tied up in a “Home PVR” system. You have to have it. You HAVE to. It’s irresistible.

Same thing happened to cars, mostly by government mandate. The cars they were building in the 60’s basically were just as good at getting from point A to point B, but they were a lot cheaper to manufacture and repair, and got about the same mileage as today. But then the government decided to “fix” the automobile, starting with emissions regulation. That was probably necessary but the trade off to getting rid of smog was drastically worse gas mileage. (One of the first things that happened to get rid of NOx was the compression ration had to be reduced. This meant the engine had to be a lot bigger. So cars started coming with 460’s in them.) Nowadays cars are so complicated you need a computer to find out what’s wrong with it, and they are so expensive to buy people need 60 month financing. I had a ’67 Cougar for a while that was a hobby car. 302, no computers, easy to work on. The automatic transmission needed to be rebuilt. $350. This was in about 1995. Try getting a transmission fixed let alone rebuilt for $350 today.

And don’t get me started on what it costs to own a Harley. Yikes! That isn’t for the 99% anymore.

#24 Tina Dinnowski on 05.23.18 at 7:20 pm

I saw somewhere a 3% 1 year GIC. I can’t remember, Google it.

#25 Steven Rowlandson on 05.23.18 at 7:24 pm

“Households owe more money than the size of the entire economy (over $2.1 trillion), 60% of which is in the form of mortgages on houses that may have tripled in value in the past few years. Classic bubble, based on loose credit and cheap rates. Real estate has soared. Incomes have not. So debt has soaked up the difference.”

I take it government and business debts are extra?
So how big? When does rising interest rates cause it all big and small to go into the crapper? What is the magic number?

#26 NEVER GIVE UP on 05.23.18 at 7:27 pm

#236 IHCTD9 on 05.23.18 at 12:19 pm
#225 NEVER GIVE UP on 05.23.18 at 11:41 am

Another poster compared socialism with Venezuela. That country is a failed state because it is a strong man dictatorship. No socialism there.
______

Venezuela did great under Chavez.

Was Venezuela a Socialist country then?
====================================
http://www.foxnews.com/world/2015/08/10/hugo-chavez-daughter-is-richest-individual-in-venezuela-report-claims.html

A country can still grow under a dictator. Especially when that dictator has control of an oil rich nation with one of the largest reserves in the world!

Usually they use the nation as their personal bank account. Unless you believe that Hugos daughter was a high income earner! LOL.

Stinks like Marcos in the Philippines.

My ex wife’s family was very close to Marcos by marriage and all of her uncles and her father were employed in Stock market fraud and money laundering. They were the ones purchasing the towers for Marcos in New York, Hong Kong, Paris, and Vancouver to name a few places. They confided in me about the “life”. They told me about the pump and dump schemes in the stock market they were told to do from the “boss” Marcos. Wisely they all got out just before the SHTF in the 80’s. A half a plane load of them left just in time and settled in Vancouver.

The richest one of them, Joe Campos just died a billionaire recently. He could never go back to Philippines or a bullet would find him. Still owns Drug companies and property development in the Philippines. Heirs own lots of Robson Street property in Vancouver.

Basically a bunch of criminals and it shows in their personalities.

The third world is full of these types and anyone who cares to read a bit could learn about how many people have died as a result of their murders, and their theft of the public purse. In the Philippines there were many people starving to death and dying of disease untreated in the smaller provinces while the elite was raping the national treasury in the 50’s to the 80’s, and it continues to this day.

#27 Vote Doug Ford to fight feminism on 05.23.18 at 7:36 pm

There is no future for young men in Canada. Not even signing up for acting on shady video agencies will give a Canadian man stable income to live on.

There is no future for any young man living in Toronto because the city is absolutely infested with feminists and Liberal elites.

The only future of hope for young men in Canada is to vote Doug Ford for Leader of Ontario. As your Premier I will slash funding for social services like feminist art grants, implement a scientific based approach to Health Education, compel universities to allow Eric Brazau and Hitler to host free speech rallies on campus, and increase male employment rates by forcing women back into the kitchen.

Vote #Doug Ford for Premier.

Brought to you by an Ontario Liberal supporter who is engaged in a PSY-OP operation paid from your tax dollars. My MP provides me a stipend of $1,000 a week to troll on conservative platforms to make them look bad.

#28 Adam on 05.23.18 at 7:36 pm

“If they could plop down 20%, no test. So no mortgage insurance. No protection for the lender.”

Five years ago when I got my first mortgage, I asked the Soctiabank-employed guy who was doing the paperwork why a bank would give a better rate to somebody with more than 20% down, shouldn’t they give the best rates to people with less than 20% down, because they’re essentially riskless mortgages (from the banks perspective) backstopped by CMHC, with the borrower being on the hook for the fee? He just looked at me and blinked….astoundingly, it appears, nobody else realized this until recently either.

#29 Nonplused on 05.23.18 at 7:37 pm

#7 jess

Probably about the same purchasing power.

#30 Happy Housing Crash Everyone! on 05.23.18 at 7:40 pm

We expect there to be an origination decline in the 50 per cent range relative to the same period last year. A year ago, two-thirds of our revenue would be related to our mortgage business and today that’s about a quarter.”

Just proof the GTA is nothing more then a Ponzi scheme bubble based on Mortgage fraud and cheap and easy credit. Imagine No CMHC? The decline would be even greater as no bank would lend to anyone in this Ponzi scheme.

#31 Shawn Allen on 05.23.18 at 7:41 pm

Jess says $25 million is the new $3 million in about 25 years.

Shocking because it would take let’s see umm only a bit less tan 9% compounded to turn $3 million into $25 million in 25 years.

The message? Investing is a darn good idea?

What a nice rich country we live in when it takes $25 million to join the ultra high net worth club.

#32 MSM-Free Zone on 05.23.18 at 7:59 pm

#21 The Real Mark (not the imposter) on 05.23.18 at 6:59 pm
“…..10 year run? Not in Canada. The TSX is only a few percent above its 2008 level. Still plenty of runaway ahead of it….”
_______________________________________

“…that could take much of Bay Street down with it (financials make up 34% of the equity market)….”

I guessed you missed that part.

#33 MSM-Free Zone on 05.23.18 at 8:01 pm

#21 The Real Mark (not the imposter) on 05.23.18 at 6:59 pm
_________________________________________

Is that like……@realDonaldTrump?

#34 Dave on 05.23.18 at 8:06 pm

CIBC reporter record profit today.

#35 tccontrarian on 05.23.18 at 8:06 pm

#25 Tina Dinnowski on 05.23.18 at 7:20 pm

” I saw somewhere a 3% 1 year GIC. I can’t remember, Google it.”
——————————————————–
Or you could buy the TLT ETF (20+YR to maturity Treasuries), at current prices (~$118), hold for a few weeks/months till it goes to $125-135 and make +10% in cap. gains + 2.65% dividend yield.
Also, and you’re free to buy/sell any time you please as opposed to being ‘locked’ in, as in a GIC.
I believe Garth has called GIC’s as a ‘brain-dead’ investment. I concur! As are Mutual Funds!

TCC

#36 crowdedelevatorfartz on 05.23.18 at 8:07 pm

@#28 V.D. Ford to f. Feminism

“My MP provides me a stipend of $1,000 a week to troll on conservative platforms to make them look bad.”
+++++

yer doin an awesome job.

#37 Doug t on 05.23.18 at 8:15 pm

Read The Creature from Jekyll Island: A Second Look at the Federal Reserve – find out how modern banking began and how evil it is to the masses

RATM

Try living without central banks and discover monetary chaos. – Garth

#38 Leo Trollstoy on 05.23.18 at 8:16 pm

In 1994, $3 million was enough to be considered ‘ultra-high net worth,’ said Peter Charrington, global head of Citi Private Bank.

‘Fast-forward almost 25 years, and $25 million is how we define ultra-high net worth,’ he said.

Exactly what I posted in the past

8 figures or don’t bother posting your stuff. You’re just embarrassing yourself

#39 Vision on 05.23.18 at 8:17 pm

#23 Turner Nation
Dead on!
What can we do about it?

#40 Lost in Abbotsford on 05.23.18 at 8:24 pm

“#15 MSM-Free Zone on 05.23.18 at 6:35 pm

the Maroon Bank of Penquinettes (The Simple One) is offering 2.75% CIC’s on a one year term”

I just phoned CIBC a minute ago. They do not have any one year GICs near this rate.

Of course not. – Garth

#41 dakkie on 05.23.18 at 8:24 pm

What Will Surging Mortgage Rates Do to Housing Bubble 2?

http://www.investmentwatchblog.com/what-will-surging-mortgage-rates-do-to-housing-bubble-2/

#42 For those about to flop... on 05.23.18 at 8:31 pm

You down with OECD.

Yeah, you know me…

M43BC

“See How Your Take Home Pay Compares to Workers Around the World

Tax season has finally come and gone, and by now most Americans have either gotten their refund or established a payment plan for taxes owed to the government. Here’s a nice thought experiment: go back and look at your tax return to figure out how much money the government claims through all forms of taxation. How does your own situation compare to the rest of the world?

The Organization for Economic Co-operation and Development (OECD) tracks both the average wage earnings and taxation figures for each of its 35-member countries. Gross earnings refer to the amount of money you get paid before anything gets taken out, like taxes, health insurance and retirement contributions. The remainder is referred to as net earnings. We used these numbers to create a pie chart. The overall size of each slice refers to the level of gross earnings, and the green portion represents net income after taxes. We illustrate the difference between these two figures with dark red referring to income tax rates, and pink referring to social security taxes. The result is a snapshot of how much workers actually take home across the OECD.

Top 10 Countries with the Highest Net Wages
1. Switzerland: $58,864 after paying 16.9% in taxes

2. Luxembourg: $46,593 after paying 29.1% in taxes

3. Iceland: $45,390 after paying 28.7% in taxes

4. Korea: $44,892 after paying 14.5% in taxes

5. Netherlands: $43,835 after paying 30.4% in taxes

6. Australia: $41,655 after paying 24.4% in taxes

7. United Kingdom: $41,608 after paying 23.4% in taxes

8. Japan: $41,139 after paying 22.3% in taxes

9. Norway: $40,834 after paying 27.6% in taxes

10. United States: $39,211 after paying 26% in taxes

Our chart reveals a few different dynamics in the OECD. First off, Switzerland stands out atop the rankings with $70,835 in gross and $58,864 in net take home pay. The combination of high earnings with low taxation is hard to beat. Now take a look at South Korea. The country ranks way down in 14th place in terms of gross earnings ($52,505) but rises to 4th in terms of net earnings ($44,892). That’s entirely thanks to a relatively light tax regime of 14.5%, which is the third lowest rate in the OECD behind only Chile (7.0%) and Mexico (11.2%).

At the other end of the spectrum, some countries have extraordinarily high taxation levels that take up significant chunks of workers’ paychecks. Belgium is the clear outlier in this regard with $58,545 in gross but only $34,834 in net take home pay. This is thanks to an average total tax rate of 40.5%, pushing it below Ireland and France.

Another interesting trend in our visualization is how many OECD countries are scrunched at the low end. Mexico, Latvia and Chile are so small that the slices are almost difficult to distinguish. In fact, the average gross earnings across the entire OECD is only $43,792 with net earnings amounting to just $32,624. This means that Americans are above average in terms of their earnings, but not dramatically so. The potential to make an obscene amount of wealth is likely higher in the U.S. than any other country, but not for most people.

There are two important caveats to keep in mind. First, federal income taxes can be highly complex, and as much as 45% of taxpayers don’t pay any federal income tax whatsoever. Second, despite all the focus on take home pay, it is worth remembering that income taxes and social security taxes both eventually buy workers something—namely, everything that the government spends money on. Many people across the OECD take the long view that paying for social services through taxation makes a lot of sense for society. All that being said, more take home pay on par with Switzerland wouldn’t be too bad either.”

https://howmuch.net/articles/money-people-take-home-after-taxes

#43 Danny on 05.23.18 at 8:35 pm

Very interesting info……will the banks be as forthcoming and help the fools who just don’t understand their financial woes? Probably not…it takes honesty to be the first bank to reveal the many personal debt problems.

Yes honesty hurts, so the Banks make short hint like statements…which people like Garth has to read between the lines to keep sounding the alarms…Too bad many people are deaf.

Yes Garth………”Washington spent (literally) trillions trying to revive the economy and restore faith in the financial system.”

Actually many Republicans were not really supportive.
I was surprised how much “Obama “….supported and led the march on that one.

Can we say……Obama instead of ” Washington “. I can.

That was one Obama achievement that “Vindictive Don Donald ” can never take away from Obama.

Well maybe when Trump hides in Saudi Arabia to lick his wounds…..history will reveal more Truth about under the table deals the whole Trump family engaged in white collar crimes and the corruption from using Washington favors to get more questionable and suspicious loans…..

Nepotism worked not only for Mussolini and Gaddafi….and other dictators and Royal Families over the ages.

#44 Reximus on 05.23.18 at 8:35 pm

Read The Creature from Jekyll Island: A Second Look at the Federal Reserve – find out how modern banking began and how evil it is to the masses

RATM

—–
you can always tell someone never took a first-year Finance & Banking course when they recommend that book…”holy crap, you wont believe how the fractional banking system was invented!”

#45 Shawn on 05.23.18 at 8:42 pm

It’s likely that the European banks run into problems again before the Canadian banks. Interest rates can’t get off of zero there. Banks are having profitability issues. EUFN will lead the way down…

QQQ > SPY > EEM > TSX > VGK

#46 What can I say about that? on 05.23.18 at 8:44 pm

5 FOUR FINGERS WATSON on 05.23.18 at 5:53 pm

Obvious conclusion……rates will be lower for longer.

——————————————-

Exactly. I can’t see how anyone in their right mind can believe that rates will be going up significantly. Just the opposite is true.

#47 Reality is stark on 05.23.18 at 8:45 pm

The financial crisis. What really happened and why?
The neocons owned Dubya even though they only represented about 5% of the Republican Party.
It was Brooksley Born who sent out the warning that derivatives were a shell game. The neocons went in to panic mode and shut her down.
When congress asked Greenspan what derivatives were he told them he had an army of PHD’s and they didn’t know what they were. Even though he really didn’t understand derivative markets he was confident that the instruments were safe. A fairly absurd statement from a cogent fellow.
The real issue of course was that they didn’t want the US economy to slow and American citizens to lose their zeal to fund the Iraq war. It was the poor and uneducated young American men that got to die in that war.
Alan Greenspan is the true Israeli war hero. He single handedly funded that war long after it’s due date.
Who cares that he caused a worldwide financial crisis. He did after all issue an apology for that but his mission was accomplished.
The financial crisis never affected us in Canada quite as badly as oil and an idiotic housing market have medicated the people. But the chickens have come home to roost now and it is our turn to cry. We have no leadership to guide us through this period. Our leaders only understand paying for social justice through debt financing and new creative taxation.

#48 Shawn on 05.23.18 at 8:46 pm

Short Credit Suisse (CS).

#49 waiting on the westcoast on 05.23.18 at 9:00 pm

#34 MSM-Free Zone on 05.23.18 at 8:01 retorts… “#21 The Real Mark (not the imposter) on 05.23.18 at 6:59 pm_________________________________________
Is that like……@realDonaldTrump?”

The funny thing is both the original Mark and Real Mark are equally confusing / in error… Not sure which is which any more… ;-)

#50 NDP OK on 05.23.18 at 9:02 pm

DELETED

#51 Doug t on 05.23.18 at 9:05 pm

Read The Creature from Jekyll Island: A Second Look at the Federal Reserve – find out how modern banking began and how evil it is to the masses

RATM

Try living without central banks and discover monetary chaos. – Garth

That doesn’t he to be the case Garth – just create a new system -just because the modern cartel has existed for roughly a hundred years doesn’t mean we have endure it – brilliant minds always get creative when needed – and we desperately need it

RATM

#52 Myra Andrews on 05.23.18 at 9:08 pm

Greater Vancouver Stats from realtor Paul Boenisch

May 23 New 328 Sold 144 TI: 11,613
May 22 New 477 Sold 143 TI: 11,496

May 18 New 226 Sold 119 TI 11,208
May 17 New 191 Sold 110 TI 11,161
May 16 New 235 Sold 147 TI 11,133
May 15 New 315 Sold 178 TI 11,127
May 14 New 302 Sold 124 TI 11,052

May 11 New 183 Sold 132 TI 10,935
May 10 New 229 Sold 126 TI 10,957
May 9 New 309 Sold 172 TI 10,914
May 8 New 318 Sold 117 TI 10,835
May 7 New 389 Sold 131 TI 10,697

May 4 New 191 Sold 110 TI 10,540
May 3 New 213 Sold 103 TI 10,503
May 2 New 268 Sold 146 TI 10,481
May 1 New 363 Sold 134 TI 10,420
Apr 30 New 375 Sold 163 TI 10,459

April 16-27 New 2453 Sold 1224 TI 10,347
April 3-13 New 2111 Sold 916 TI 9,727

Mar 19-29 New 1834 Sold 1072 TI 9,032
Mar 5-16 New 2248 Sold 1224 TI 8,743

The inventory at the end of February was 8,211

#53 Mark on 05.23.18 at 9:09 pm

So if originations are going to collapse, this implies that the mortgage brokers are toast. Right?

This also means that a heck of a lot of people, in their estimation, are so trapped with their lender that they basically have little to no choice other than to sign a renewal letter at a non-discounted rate. Agree?

This is extremely bullish for the Canadian banks. If I didn’t already own a full allocation of Canadian banks, I’d probably want to buy more.

#54 Bobs ur uncle on 05.23.18 at 9:11 pm

#36 tccontrarian

https://www.theglobeandmail.com/globe-investor/inside-the-market/this-bond-etf-is-the-master-of-disaster/article34575126/

Info is a year old, but still applicable I’m sure:

“Investors have been in a confident mood lately, and so TLT has suffered. For the year to Feb. 28, the total return of interest plus share price changes is a loss of 4.7 per cent. If the U.S. economy picks up and interest rates rise, this ETF could get hammered. The effective duration of the portfolio is just over 17 years, which means a rise of 1 percentage point in interest rates would result in a loss of 17 per cent (and vice versa if rates fall).”

That’s…quite a bet…do tell us how it pans out.

#55 Still in cowtown on 05.23.18 at 9:17 pm

#25 Tina Dinnowski on 05.23.18 at 7:20 pm
Just got 2% floating GIC (resets quarterly and callable/cancelable by me) at one of the ‘blue’ big five… the tides are turning in favour of savers and not so much for borrowers…

The inflation rate is 2.1%. You lose. – Garth

#56 dr talc on 05.23.18 at 9:21 pm

#38 Doug t on 05.23.18 at 8:15 pm
Read The Creature from Jekyll Island:

g edward griffin is an obvious plagiarist
he also advocates return to a gold standard
he plagiarized the eustace mullins’ book:
the secret of the federal reserve.
although it is acknowledged that Ezra Pound was the instigator
when i was in the jekyll island gift shop they only sold the griffin book, not mullins’
Bill Still also plagiarized Mullins in his films- no credit or mention whatsoever

#57 PBrasseur on 05.23.18 at 9:29 pm

Well if 25% of the economy relies on an activity that is largely unsustainable then I’d say you have a problem, a big one.

#58 akashic record on 05.23.18 at 9:32 pm

Try living without central banks and discover monetary chaos. – Garth

I can’t remember this choice on a referendum, not even in public debate, so it’s hard to prove it either way.

Unless, of course, if you don’t find “chaotic” enough a couple of random headlines – besides what you describe in Canada:

– Fed Finds 22% Of American Adults Can’t Pay Their Monthly Bills; 41% Have Less Than $400 In Cash

– Fed Study Asks “Are Millennials The Lost Generation?”

– Doing God’s Hedging: Goldman Made $200 Million In One Day During Feb 5 “Volocaust”

– A study from the same Goldman states: “as machines have replaced people, and speed has replaced capital, the ability of the market’s liquidity providers to process complex information may lead to surprisingly large drops in liquidity when the next crisis hits.”

But you can start thinking about Financial Stability Without Central Banks:

https://iea.org.uk/wp-content/uploads/2018/02/Selgin-Interactive.pdf

#59 tccontrarian on 05.23.18 at 9:34 pm

#55 Bobs ur uncle on 05.23.18 at 9:11 pm

“Info is a year old, but still applicable I’m sure:”

A year old ‘news’ from a newspaper?? LOL
It was “too old” the day it was printed – as most printed ‘news’, by writers that have little (or zero) track record on their market calls.

“That’s…quite a bet…do tell us how it pans out.”

“Quite a bet” on an asset that has been in a 37 year bull market? Hmmm…gotta think about that. Um, not really a stretch that it will continue for a few more months. Statistically, almost a 99% certainty.

I don’t have to ‘report’ back with how it pans out – you can track it yourself, if you really want to know.

TCC

#60 crossbordershopper on 05.23.18 at 9:34 pm

i have a weekly covered call write strategy that i have been doing with cm for a few years now. i buy the stock and use the 5.32 dividend that i buy long dated put option so that i have no risk on my investment, i am short the dec 114 calls which is my 2018 price.
on a weekly basis i write at the money calls, i collect anywhere from .60 to 1.10 a week, its been basically a thrid and third a thrid so far. so sometimes i get called, its down a buck or so on the week, sometimes its near the start of the week and sometimes i pay the 43 bucks in commission compared to 6.95 to buy. if exercised.
i have found this to be an excellent risk reward ratio, i simply am completely covered 100% assurance of at least my money back if it is below my cost at expiry date. i play the game with the premium, week after week after week.
its about a 30% return for me, ya i know people dont beleive me but, its worked for me, 100% principal protection and a lot of premium over the year.
for what its worth thats my trading since the topic of cm came up today

Or, you could get a job. – Garth

#61 Reynolds531 on 05.23.18 at 9:37 pm

Well, pigs are flying tonight. The Liberals declined the Chinese buying aercon on security grounds.

One in the win column.

#62 jim on 05.23.18 at 9:40 pm

“Try living without central banks and discover monetary chaos. – Garth”

No, not chaos. Freedom. People free to choose currencies.

It is odd that you cling on to a relic of soviet style command and control thinking. The claim that a group of people can manage an economy is the greatest conceit in history.

The USA had competing currencies at various times, and the real problem with them was that the government couldn’t manipulate the currency. Recent work in economics has shown that the major strategy nation states use to escape debt obligations is currency devaluation.

It becomes a whole lot more difficult to depreciate the currency when people can just shift to an alternative.

You might call it chaos, but a communist would probably say the same thing about you being able to buy cars from Ford, Toyota, Hyundai, etc.

#63 jim on 05.23.18 at 9:43 pm

” the banks want to now be seen as technology companies who have financial operations”

That’s sad, because they are complete incompetent at technology.

Canadian banks are probably even worse than clowns like CGI. (I mean the IT firm, not the Clinton Global Initiative, although I guess that is a fair comparison too).

However, maybe they saw the party coming to an end and tried to upgrade their PR speak to position themselves as technology leaders.

As an example of their incompetence, MITACS had a post the other day looking for PhD students to work with a major financial institution to implement fraud detection and anti-money laundering (AML) software.

That’s how idiotic the Canadian banks are. Instead of hiring experts, they outsource key functions to broke grad students. These are your ‘technology’ leaders.

#64 conan on 05.23.18 at 9:44 pm

Is that Trump carving up the Holiday bird; while the
very difficult to deal with ,and very spoiled Canadian Dog, waits in vain, to cut a NAFTA deal?

Bozo eruption award 2018 goes to Trump. I thought it was going to be Jason Kenney, but no, its Trump.

#65 Michele on 05.23.18 at 9:45 pm

Question for blog. Is title insurance necessary when buying a new home from builder in Ontario or is it a rip off benefitting insurance company and lawyers? Experiences and advise appreciated.

The best insurance money can buy. – Garth

#66 NoName on 05.23.18 at 9:50 pm

I was reading this this article earlier today, reminds me of four zero seven deal, minus the billboards and move theatre thingy, but I am sure path we are on we will eventually get there…

https://finance.yahoo.com/news/china-apos-social-credit-system-072010400.html

#67 Ian on 05.23.18 at 9:52 pm

The banks are going to get smoked.

And one way or another the taxpayer will have to help. This is too big a problem.

#68 Terry on 05.23.18 at 10:09 pm

“As you know, the yanks securitized dodgy mortgages, turning them into AAA-rated investment assets that Wall Street harpies sold to unsuspecting clients. (“Hey, they’re residential mortgages? What could possibly go wrong?”)”

Some FYI ……………… most of that AAA garbage is still on the books of those investment banks. It was March of 2009 when the U.S. government mandated the FASB to change it’s accounting rules to allow those bad investments to be shown as Level 3 assets or off balance sheet assets. Once that happened 700 billion in TARP money came rushing in to recapitalize the banks so they could lend out again and stay in business. Almost to the day when the FASB rule change happened the stock markets all around the world put a V-bottom stop in place and have been rising ever since. Don’t ever think that the credit crisis of 08/09 is over. Those bad debts still have to be dealt with because they are still there!

#69 Bobs ur uncle on 05.23.18 at 10:09 pm

#60 tccontrarian

“make +10% in cap. gains + 2.65% dividend yield.”

“Statistically, almost a 99% certainty.”

Must be quite a crowded trade with those odds. I mean – it’s almost unbelievable.

#70 MF on 05.23.18 at 10:14 pm

48 Reality is stark on 05.23.18 at 8:4

You purposefully ignore several events in your simplistic narrative.

Our system is in trouble because rates have been too low for too long. We need rates to rise so the credit bubble can burst (slowly we hope). Our leaders know it will hurt, so the can is kicked down the road. in June 2004 fed rates started to go up. Greenspan started to administer the medicine. The derivative mess, of course, was bigger than anyone could imagine and the credit bubble popped bigger than expected.

To blame Greenspan for trying to administer the necessary medicine, and then complain about our own system’s need of the same medicine is a joke.

Iraq 2:

You downplay the impact of the first Persian gulf war, what caused it, and it’s lingering effects.

You downplay the impact of Saudi Arabia in the whole affair

You downplay W’s father’s role in Iraq 2.

You downplay the role of oil in all of it.

You downplay 9/11 (and I don’t care about any worthless conspiracy theory trash)

With a name like “reality is stark”, you should know reality is never simple, always messy, and usually complicated.

MF

#71 PastThePeak on 05.23.18 at 10:20 pm

I got some cash set aside for the express purpose of picking up some bruised bank shares. Outside of a few pullbacks that Garth mentioned, CAD big banks are a (literal) license to print money…

#72 D Apostrophe on 05.23.18 at 10:22 pm

Bet on it. This is the beast unknown. M’Hosers.. how bad will it get? Well, I can see an analogy.. this housing market has been arcing like 45 since September 2016.. almost to the week. Not gonna be pretty on both counts. The good news is that the blood in the gutters in the 6ix.. won’t have the same source as the gutters in the US. However, I hope I’m wrong.

#73 Boombust on 05.23.18 at 10:33 pm

Jeepers!

When the Vancouver Global News at 5:00 tonight does a story about the real estate situation in Vancouver and leads in with the anchorman saying,

“Is Vancouver on the verge of a real estate collapse?”.

When Global (spinmeisters such as they are) finally poses the question, you certainly knpw something is cookin’.

#74 Shawn Allen on 05.23.18 at 10:47 pm

Bad Mortage Debt From 2008?

#69 Terry on 05.23.18 at 10:09 pm said:

Some FYI ……………… most of that AAA garbage is still on the books of those investment banks. … Those bad debts still have to be dealt with because they are still there!

**********************************
Really? I would have thought that if a mortgage that existed in 2008 was bad, it would have been bad and foreclosed on a long time ago. If the mortgage has been paid for the last ten years and house prices have recovered then it’s not likely the mortgage will default now, is it?

A ton of people until in 2009, 2010 were warning that all the big U.S. banks were “technically insolvent”. Meanwhile some of us were buying Bank of America under $7.50 and some bought under $6 as late as near the end of 2011.

And much the same people were warning that U.S. houses prices would crash even further. Meanwhile many smart Canadians picked up the deals of a lifetime in Florida and other U.S. states. And they did it with out dollar at par in some cases. Garth and others on this blog mentioned the opportunity back then.

The banks may have bad loans at this time. If they do it is likely newer loans not 2008 loans. Generally with U.S. house prices recovered but still affordable, the U.S. banks are in fantastic shape. Their leverage is still high but far lower than 2008.

But there is never any shortage of doomer sites to tell you the end is nigh.

#75 crowdedelevatorfartz on 05.23.18 at 10:52 pm

I’ve spoken to 3 different people in 3 totally different jobs who have just relocated from Alberta to Vancouver.
The economy there is dead. Nothing is moving.
Dippers to blame? Too soon to be sure but if Notley doesnt pull a golden rabbit out of her butt real soon…

And here in the LowerBrainland everyone is bitching about the cost of everything.
Housing, taxes, rents, car insurance, user fees, food, gas, you name it, its too expensive.

Rising interest rates?
God help us all

#76 WUL on 05.23.18 at 11:24 pm

A confession. Years ago, this lifelong NDP supporter in Alberta became a 10 minute Tory. I bought a membership only to vote for a leadership candidate other than Alison Redford.

The news of Dug Ford buying memberships to enable support for a candidate of his choice is not newsworthy.

Politics is the dirtiest business.

However, you must admit that my voting for someone other than Redford was prescient.

#77 salted on 05.23.18 at 11:33 pm

#24 Nonplussed

That was a good read. Thanks :)

#78 Peter on 05.23.18 at 11:48 pm

Hey Garth,

What do you mean by “In that case, back up the truck. I’ll drive.”?

Thanks for keeping up with the blog,
Peter

#79 Rural Rick on 05.23.18 at 11:52 pm

So if all the balls stay in the air there will be more of the same until the balls don’t stay in the air which will mean a buying opportunity for the bold. Forlock tug to the sage.

#80 Fake News Again on 05.23.18 at 11:55 pm

Dave on 05.23.18 at 8:06 pm
CIBC reporter record profit today.

____

I wonder what the public would do if they found out….I mean REALLY found out that banks are “legally allowed” to print money out of thin air with loans and make “interest” on said loans created out if nothing.

Me thinks “quarterly record profits” would end like the ice age.

#81 earlybird on 05.23.18 at 11:57 pm

As per usual, thank you for the stimulating, orgasmic read…truly..
1)Awesome dog pics…most importantly! ; )
2)Wow.. arousal at 2%
3) America has confirmation bias..
4) HELOCS are the extend and pretend
5) Bought Royal at$ 45, thought is was overpriced…who knew..
Happy as a shareholder that the banks can reap such incredible profit…as an essential service to all wonderful countrymen..really a I am truly happy for them, thanks for all that you do…SARC OFF…

#82 Fake News Again on 05.24.18 at 12:02 am

Doug t on 05.23.18 at 8:15 pm
Read The Creature from Jekyll Island: A Second Look at the Federal Reserve – find out how modern banking began and how evil it is to the masses

RATM

Try living without central banks and discover monetary chaos. – Garth

____

The United States of America did JUST FINE without a “PRIVATE” central bank for nearly 150 years. Then the world was taken to the cleaners and it has been nothing but “RECORD PROFITS” for banks ever since.

#83 MSM-Free Zone on 05.24.18 at 12:04 am

#41 Lost in Abbotsford on 05.23.18 at 8:24 pm
“#15 MSM-Free Zone on 05.23.18 at 6:35 pm

I just phoned CIBC a minute ago. They do not have any one year GICs near this rate.

Of course not. – Garth
___________________________________________

Au contraire….

Read it again, not CIBC Penquins, but CIBC Penquinettes (aka Simplii, a subsidiary of CIBC):

One year GIC: 2.5%:

https://www.simplii.com/en/investments/gic.html

Simplii is not CIBC. And they can’t spell. – Garth

#84 Smoking Man on 05.24.18 at 12:05 am

Trying to make a blog dog meet up when im in Toronto next week. Thursday night is looking good.

Duke of Devon on Wellington and bay. Patio. 5ish.

Bay street beasts. Turner Nation? You in.

JohnnyBoy. James, Gravy train.

Come vent on me in person. I’m bringing three MAGA caps. Just for you three.

#85 Tom from Mississauga on 05.24.18 at 12:14 am

Really strange what’s happening in Mississauga, my new work gave me an 11% pay increase to keep me. Thought I made out like a bandit till the work piled up and we tried to hire a temp, still haven’t found one. The agencies haven’t got anyone. Overtime is unlimited. Yet properties are piling up for sale near me at hwy 10 and the 403. Nothing is moving at all. What a change from 2 or 3 years ago.

#86 Jon on 05.24.18 at 12:27 am

#18 bitcoin will be 6500 within two months the downtrend is well in place why in the he’ll would you load up now. There is currently no catalyst for higher bitcoin prices talk to any real btc trader. Wait my friend

#87 Canada=Poor cousin of U.S on 05.24.18 at 12:34 am

Canadians are house obsessed and very different from Americans.

#88 Blacksheep on 05.24.18 at 12:38 am

Reynolds 531 # 62,

“Well, pigs are flying tonight.”
———————————–
I’m the first to admit, the undeniable attraction to the compliant ride that is, a fine butted chromoly frameset (Multiple Rocky blizzard’s, circa 1996 and some Brodie fetishes) what’s your flavor?

Back in the day, never had the bux for Ti frame, then, full suspension came around and chromoly was history…

#89 Blacksheep on 05.24.18 at 12:53 am

US$ on a tear lately, but still CAN$ holding high 70’s.

No rate move coming. Polooza won’t kill exports.

#90 Stan Brooks on 05.24.18 at 12:57 am

Of course banks will make big money on deposits.

Thanks to the thieves and idiots at BoC banks pay close to nothing on deposits (interest rate in deposits is related to central bank) while increasing long term loans and mortgage rates (related to US 10 years treasury bills which do and will go further up) while taking no risk due to idiotic CHMC policies.

Canadian savers are some of the most gullible sheeple on earth.
As are Canadian taxpayers.

Pay, pay, pay and get nothing in return, expect the privilege to look at low IQ politicians screwing you and the generations ahead.

3rd world country life-style is an understatement, at least these have much cheaper cost of living and usually much better weather.

Even 350-400 k for the likes of the cardboard particle homes or glass condos in GTA considering the cost of living and the wages is pushing it.

700 k sounds absolutely ridiculous.

1 mil is idiotic and sign of serious societal mental illness,.

1.5 mil in places like Vaughan and Scarborough is simply indescribable.

#91 Stan Brooks on 05.24.18 at 1:14 am


But what about mortgage insurance? Doesn’t Canada has in place a regime that will instantly protect the banks if homeowners started mailing back their keys? Yes, we do, and CHMC stands behind about $600 billion in mortgages. But that’s less than a third of the home loan debt outstanding, and does not take into consideration another $320 billion in HELOCs (40% of which aren’t being repaid)

Government also insures private mortgage insurers like GenWorth.

Total coverage over 900 billion.
+ over 200 billion Euro (320 billion cad) in covered bonds sold to Europeans.

+ over 320 billion in HELOC.

They/Canadian taxpayers also cover US exposure, do you think Canadian bank with US business will be left to suffer losses due to US exposure?

It always amuses me the degree to which we are accustomed to lies.

The finance minister lies that federal debt is 35 % of GDP, around 650 billion.

And then compares that to government dept of countries like Germany that has no provincial dept.

Even federal debt is understated, total federal debt is over 1 trillion (including crown corporations), total government debt, including provincial is over 90 % of GDP.
we have record private dept (citizens over 100 % of GDP) , if we include private corp debt we have worse situation than Italy that we laugh at.

Worse, if we measure in net national product (excluding excess credit of over 200 bil annually) the things are mush worse.

https://bizfluent.com/info-8126440-differences-between-gdp-nnp.html

our current account balance per capita is the worst in the world by far.

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

Pretty good indication on where lies can bring you with gullible and stupid population.

I continue to bet on catastrophic economic and house market failure, inflation and higher taxes.

Anything short of 80 % decline in real (inflation adjusted) house values in places like GTA and Vancouver is laughable.

#92 Stan Brooks on 05.24.18 at 1:21 am

Look at TSX ‘performance’, money flows (accelerating outflow of capital from Canada), gas prices at the pump, food prices, taxes.

Not just the moment state but the trends. It paints horrific picture.

Pity for the young, who will never work a decent job and will have to continue experiencing T2 socks, his corrupted band of thieves, the maple leafs and raptors suckers and drake.

#93 dee on 05.24.18 at 1:48 am

Question for blog. Is title insurance necessary when buying a new home from builder in Ontario or is it a rip off benefitting insurance company and lawyers? Experiences and advise appreciated.

The best insurance money can buy. – Garth

_——————

G, hopefully you can explain why one day please.

#94 Renter with reliable job, two kids on 05.24.18 at 1:50 am

After receiving the dreaded “termination of tenancy” papers via email last month, I have been finding out that with the B.C. Speculation tax fast approach, my children and I may be the “hot commodity”, for tax avoidance.

Unfortunately we have to move by June 30th, but if we could have held out until July 31st, we actually may have been able to find something decent at a reasonable price! It’s all Spec landlords here on the North Shore here so far, and dark dingy basement suites are the only affordable game in town at about 50% after tax income + utilities.

Any ideas how to turn this into a win/win situation?

#95 Blacksheep on 05.24.18 at 2:02 am

Bla, bla, bla…..There are more important things in life:

https://www.youtube.com/watch?v=KC5H9P4F5Uk

#96 jane24 on 05.24.18 at 2:25 am

The Organization for Economic Co-operation and Development just published a wage report for their 35 member countries. I was quite surprised when I read it today. It calculates the average net wage per person when all taxes and social security payments are taken off, all calculated in US dollars. What the average person has to spend. The countries were ranked 1 to 35. Of the countries of interest to me you have:

6. Australia – 41,655
7. UK – 41,608
10. US – 39,211

The other top ten countries are in Northern Europe and Japan and South Korea.

In the lower ranks are:
France – 34,224
Italy – 29,793
Canada – 31,639
New Zealand – 32,617.

Now 50 years ago my dad told me that we were moving to Canada as it represented higher wages and I believe we moved for double his UK salary and with 5 kids he needed it. In the 50 years since I do wonder what happened. I have noted that Canadian family members seem to have little ready cash. I may not be the only British Canadian who decides to return home to Britain.

Canada according to the numbers is in a slow decline, a little each year but like the frog in the hot water, one doesn’t notice. Why? Can’t be socialism as some of those Northern EU counties are far more left politically with heavy tax levels but wealthy. Can’t be carbon taxes or shelling out for heat in awful winters as they have them too. Why is Canada falling down this average wage table?

#97 Howard on 05.24.18 at 2:28 am

The new allegations against Ford – that he personally bought party memberships for riding residents and bussed them in to vote for his preferred candidate – are quite serious. How on earth did he think that wouldn’t come to light eventually.

Looking more and more like an NDP minority government. It’s not all bad – foreign buyer tax will remain in place, and extending the legal minimum paid vacation to 3 weeks is the right thing to do and in any case still puts Ontario well behind European countries where 5-7 weeks is the norm.

And if they screw up, it’ll be “one and done” just like the Rae government.

#98 Proof ? on 05.24.18 at 5:45 am

Yet no mention, by anyone, that 3 casinos and a 20 year gaming license in Ontario were sold last month to the Great Canadian Gaming (GC / T) and syndicate for $ 158 Million or (one ) times EBITDA !!!

The fair market value of the transaction should be 7 times EBITDA or about $ 1.1 Billion.

The market capitalization of CG / T (who has only 50 % of the deal )went up over $ 800 Million the next day as the stock soared, reflecting the TRUE value of this deal.

Your Lieberal government just sold a prime asset for 1/7 of the price that would be normal, or another way to put it is they just gave away $ 900 Million of the province’s wealth to private parties.

I saw only 2 articles on this in the MSM and I read a lot of it every day.

This, among other massive financial disasters, is what Ontarians should be pissed at, not where beer and wine is sold.

#99 Steven Rowlandson on 05.24.18 at 6:04 am

RE#28

“Brought to you by an Ontario Liberal supporter who is engaged in a PSY-OP operation paid from your tax dollars. My MP provides me a stipend of $1,000 a week to troll on conservative platforms to make them look bad.”

Thank you for your confession. I have suspected for some time now that politics in Canada was a leftist puppet show and a false flag operation. This explains everything.

#100 Reynolds531 on 05.24.18 at 6:42 am

#88 black

Manganese molydenum. That is my flavor.

#101 Ian on 05.24.18 at 6:48 am

Interesting news overnight for the cryptotards.

U.S. Launches Criminal Probe into Bitcoin Price Manipulation

https://www.bloomberg.com/news/articles/2018-05-24/bitcoin-manipulation-is-said-to-be-focus-of-u-s-criminal-probe

#102 Ian on 05.24.18 at 6:58 am

#98 Proof

It’s unreal how low nationalised assets are sold for.

Reminds me of the IPO of PetroCan in 96/97 (or 1992 if you’re using the Mark Gregorian Calendar).

I did some calculations, couldn’t believe what I was seeing, went to our oil analyst and said ummmm why is this being sold at 1/3 the price / cash flow it should be sold at? He confirmed it. That’s around the time I started really learning about politics.

So not only did Snowboarder One rape Alberta with the National Energy Program, THEN they dumped the key asset for a song.

It’s my birthday today, so ticker symbol update:

M49ON – UltraBlues

#103 jess on 05.24.18 at 7:23 am

+’s or -‘s

https://www.stlouisfed.org/publications/regional-economist/fourth-quarter-2017/central-banks-negative-interest-rates

#104 Victor V on 05.24.18 at 7:40 am

Royal Bank’s Q2 earnings beat expectations with 9% profit bump

https://www.bnnbloomberg.ca/royal-bank-s-q2-earnings-beat-expectations-with-9-profit-bump-1.1082257

TD Bank sails past estimates as second-quarter profit jumps 17%

https://www.bnnbloomberg.ca/td-bank-sails-past-estimates-as-second-quarter-profit-jumps-17-1.1082260

#105 Tater on 05.24.18 at 7:45 am

#16 Suede on 05.23.18 at 6:36 pm
when can we vulch the banks?

The prime + half HELOC is 3.95% (2.6% effective)

Bank Dividends are over 4%

In my day, that’s what we called a nice spread

—————————————————————–
That’s a fantastically bad idea. Leveraging yourself to housing, to buy another asset that is highly leveraged to housing.

#106 maxx on 05.24.18 at 7:51 am

#22 Rexx Rock on 05.23.18 at 7:06 pm

“Thank God the BOC will not raise interests rates for many years to come because of our high debt.”

God has nothing to do with it. The BOC may try, like the straining little engine, but resistance to the global banking Borg is futile.

“Inflation will be the killer but Canadians can tough it out because were used to high taxes and just budget around these incoviences.”

Wrong. Wrong. Wrong. Canucks generally have a very low tolerance for “incoveniences” and after trying to spin like tops gone mad around government regs so that they could swallow ever more debt, hordes are teetering on the brink of consumer proposals. Let’s call that the “foie gras” of debt. Banks may be freaking out, but they’ll dine on that mass consumer mistake for decades to come. Other profit-producing “products” will step into the breach to compensate for dwindling mortgage subscriptions.

Btw, we just bought a high-end home……at 20% discount over ask – how’s that lookin’ for smart-a$$, know-it-all realtards?.

#107 jess on 05.24.18 at 8:02 am

Wednesday, May 23, 2018
Justice Department Announces Actions to Disrupt Advanced Persistent Threat 28 Botnet of Infected Routers and Network Storage Devices
Additional action necessary worldwide to remediate the botnet.

The Justice Department today announced an effort to disrupt a global botnet of hundreds of thousands of infected home and office (SOHO) routers and other networked devices under the control of a group of actors known as the “Sofacy Group” (also known as “apt28,” “sandworm,” “x-agent,” “pawn storm,” “fancy bear” and “sednit”). The group, which has been operating since at least in or about 2007, targets government, military, security organizations, and other targets of perceived intelligence value….”

https://www.justice.gov/opa/pr/justice-department-announces-actions-disrupt-advanced-persistent-threat-28-botnet-infected

#108 jess on 05.24.18 at 8:07 am

The botnet, referred to by the FBI and cyber security researchers as “VPNFilter,” targets SOHO routers and network-access storage (NAS) devices, which are hardware devices made up of several hard drives used to store data in a single location that can be accessed by multiple users. The VPNFilter botnet uses several stages of malware. Although the second stage of malware, which has the malicious capabilities described above, can be cleared from a device by rebooting it, the first stage of malware persists through a reboot, making it difficult to prevent reinfection by the second stage.

In order to identify infected devices and facilitate their remediation, the U.S. Attorney’s Office for the Western District of Pennsylvania applied for and obtained court orders, authorizing the FBI to seize a domain that is part of the malware’s command-and-control infrastructure. This will redirect attempts by stage one of the malware to reinfect the device to an FBI-controlled server, which will capture the Internet Protocol (IP) address of infected devices, pursuant to legal process. A non-profit partner organization, The Shadowserver Foundation, will disseminate the IP addresses to those who can assist with remediating the VPNFilter botnet, including foreign CERTs and internet service providers (ISPs).

Owners of SOHO and NAS devices that may be infected should reboot their devices as soon as possible, temporarily eliminating the second stage malware and causing the first stage malware on their device to call out for instructions. Although devices will remain vulnerable to reinfection with the second stage malware while connected to the Internet, these efforts maximize opportunities to identify and remediate the infection worldwide in the time available before Sofacy actors learn of the vulnerability in their command-and-control infrastructure.

The FBI and the Department of Homeland Security have also jointly notified trusted ISPs. The Department and the FBI also encourage users and administrators to review the Cisco blog post on VPNFilter, available HERE (link is external), for recommendations and to ensure that their devices are updated with the latest patches.

The efforts to disrupt the VPNFilter botnet were led by the FBI’s Pittsburgh and Atlanta Offices; FBI Cyber Division; Trial Attorney Matthew Chang of the National Security Division’s Counterintelligence and Export Control Section; and Assistant U.S. Attorneys Charles Eberle and Soo C. Song of the Western District Pennsylvania. Critical assistance was also provided by Richard Green of the Criminal Division’s Computer Crime and Intellectual Property Section and The Shadowserver Foundation.

https://blog.talosintelligence.com/2018/05/VPNFilter.html

#109 IHCTD9 on 05.24.18 at 8:35 am

#97 Howard on 05.24.18 at 2:28 am
The new allegations against Ford – that he personally bought party memberships for riding residents and bussed them in to vote for his preferred candidate – are quite serious. How on earth did he think that wouldn’t come to light eventually.

Looking more and more like an NDP minority government. It’s not all bad – foreign buyer tax will remain in place, and extending the legal minimum paid vacation to 3 weeks is the right thing to do and in any case still puts Ontario well behind European countries where 5-7 weeks is the norm.

And if they screw up, it’ll be “one and done” just like the Rae government.
________________________________________

I went thru the NDP platform last night – just to see how many expensive promises would be on the agenda, and how their plans to pay for it all looked.

I wasn’t let down – even a little bit: massive plans to spend on anything you can name, while “cutting” the cost of hydro, housing, on and on. Seriously, they have planned to spend BILLIONS, while planning cost reductions for Ontarians that will cut revenues by BILLIONS more – right alongside each other.

The slam dunk was the total absence of any credible financial plan to pay for it all.

There was a steady injection of anti-business, anti-rich rhetoric that meshed nicely with the “mighty benevolent hand of big government” point of view employed while putting together their literature.

To hell with the Libs – I’m voting NDP – I hope they get a majority.

With any luck H will kick the real cost of Hydro further again down the road near to the end of the 2020’s, and give my kids free post secondary educations. Those things combined with my efforts to side step new taxation will put me way ahead of the game – winning on both ends of the spectrum.

If she gets a majority, the state of Ontario’s finances will be horrifying 4 years from now – I’m taking WELL over 400 BILLION in debt, new taxes galore, and flat – virtually immovable revenues for the government.

#110 JohnnyBoy on 05.24.18 at 8:45 am

#84 Smoking Man on 05.24.18 at 12:05 am

Trying to make a blog dog meet up when im in Toronto next week. Thursday night is looking good.
Duke of Devon on Wellington and bay. Patio. 5ish.
Bay street beasts. Turner Nation? You in.
JohnnyBoy. James, Gravy train.
Come vent on me in person. I’m bringing three MAGA caps. Just for you three.
………………………………………………………………….
Let me get a tetanus shot first before I show up. May bring my wife on the back of my hog! She would get a big laugh at you from what she has read on this blog. ciao

#111 Conn Smythe on 05.24.18 at 9:00 am

#90 Stan the Man Brooks

“1 mil is idiotic and sign of serious societal mental illness,.”

The only mental illness on display here is yours Stanley. GTA prices are alive and well. They took a breather earlier this year just like stocks take the occasional breather before they resume their upward trajectory. I have first hand knowledge of an estate home that just sold in which my better half is one of the beneficiaries. Sold for a mere 1.33 million. Three week closing. Read and weep Stanley…

#112 Conn Smythe on 05.24.18 at 9:06 am

#83 Fake News Again

“The United States of America did JUST FINE without a “PRIVATE” central bank for nearly 150 years. Then the world was taken to the cleaners and it has been nothing but “RECORD PROFITS” for banks ever since.”

Do yourself a favour and read The Age of Uncertainty by the late great Canadian economist John Kenneth Galbraith. In it you will see what kind of larceny took place in the good ol’ US of A before they had a central bank. Banks could print their own currency and it was the wild west on financial steroids. Your comment is quite laughable. If reading isn’t your thing, Galbraith made a tv series out of his book and it aired on the BBC. Utube has all the videos.

https://www.youtube.com/watch?v=McW2aFpJxsM

#113 20% Discount on 05.24.18 at 9:07 am

Many retailers bump up the price to declare a sale for the buying suckers. You too might have been hooped. I use to sell baskets of tomatoes door to door out of town when I was a kid. Lady would come to the door, and I would look up at the sky saying it looks like rain. My pitch was since its going to rain soon will cut my price 50%, and she bought on the spot handing me cash paying me retail.

#114 Conn Smythe on 05.24.18 at 9:10 am

#79 Peter

“Hey Garth,
What do you mean by “In that case, back up the truck. I’ll drive.”?”

Peter, Peter, Peter…. It means that a Mad Max world will soon unfold and Captain Garth is gallantly willing to drive the get away truck into the wilds of our Canadian wilderness where blog dogs will survive by living off the land, far from any grid with daily sermons by the bearded mystic sage that writes this pathetic blog (his words not mine:) Get with the program Peter!

#115 LivinLarge on 05.24.18 at 9:10 am

“Of course, during it all the bank continued to be profitable, and never cut its dividend payment to shareholders. This also proved to be one fat momma of an opportunity, since the bank’s stock has since risen by 175%”… Oh was it ever. If you’re young enough to have the life span available and strong enough to watch the SP collapse but realize that any of our Big 5’s aren’t ever actually in trouble (hense no div cut etc) the 08-12 was an incredible ride to say the least. Just let the DRIP roll and you made a fortune doing nothing at all. If the div doesn’t ever get slashed (as in: it never has) then a 50% drop in SP means a doubling of the new shares dripped also paying the nice fat dividend every quarter.

This almost qualifies as “money for nothing”. And then there is the oft ignored fact that our Big 5 regularly split their shares when the SP gets above consumer comfort levels. The dividend for that Quebec-ish bank in 2000 was $2/ share but they split in 2001 and have still raised their div almost to $3, that’s the equivalent of $6/share of pre 2001 shares. This is even with a 4 year hiatus for the financial crisis.

For over a century, income investing has had a wonderful track record with the core Big 4 of our current Big 5 banks. Personally I think all investing is eventually income investing. Why else invest if not to earn real spendable income at some point.

#116 Conn Smythe on 05.24.18 at 9:13 am

#72 PastThePeak

“…CAD big banks are a (literal) license to print money…”

That is right PTP. It’s called fiat money, fractional reserve banking notwithstanding Georgist’s denial of its existence!

#117 Conn Smythe on 05.24.18 at 9:24 am

#63 Jimbo

“The USA had competing currencies at various times, and the real problem with them was that the government couldn’t manipulate the currency. Recent work in economics has shown that the major strategy nation states use to escape debt obligations is currency devaluation.”

Ah Jimbo, your non sequiturs are world class. Governments couldn’t manipulate the currency but the banks sure could! The 1800s in the good ol US of A were the wild west days of private banking. Your equating central banking to Soviet style control of an economy is also a non sequitur. You have been drinking the Ron Paul and Austrian School of Economics Kool-Aid. England has had a central bank since 1694. Captain Garth correctly point out that without Central banks chaos would ensue as it did in the good ol’ days prior to their implementation.

#118 Conn Smythe on 05.24.18 at 9:27 am

#61 Crossbordershopper

You should use some of your winnings and invest in a grammar/spelling course or use spellcheck before posting. You sound like you went to the Smoking Man School of English writing…

#119 Conn Smythe on 05.24.18 at 9:30 am

#27 Never Give Up

“In the Philippines there were many people starving to death and dying of disease untreated in the smaller provinces while the elite was raping the national treasury in the 50’s to the 80’s, and it continues to this day.”

It’s testimonials like this that reaffirm how fortunate we are to be living in this nation.

#120 20 year low , new home sales GTA on 05.24.18 at 9:31 am

https://www.mortgagebrokernews.ca/market-update/sales-of-new-homes-in-the-gta-hit-lowest-april-in-20-years-242896.aspx

#121 Conn Smythe on 05.24.18 at 9:32 am

#23 Turner Nation

“For faster health care cross into USA, flush passport, and return with open arms. ”

Make sure the door doesn’t hit you on the way out cowboy…

#122 Tony on 05.24.18 at 9:33 am

With the gross overvaluation of the U.S. stock market being short almost any stock today is a prudent investment choice. This is why shorting Canadian bank shares are doubly delicious. Americans have the guts to short dividend paying stocks and so should you! This is what shorting is all about, believe you me dividend paying stocks generally present the best shorting possibilities for maximum profit since many amateur investors overlook them. The Canadian housing crash is a much, much bigger house of cards than any previous housing crash in American history.

#123 Ian on 05.24.18 at 10:03 am

#84 Smoking Man on 05.24.18 at 12:05 am

Trying to make a blog dog meet up when im in Toronto next week. Thursday night is looking good.
Duke of Devon on Wellington and bay. Patio. 5ish.
Bay street beasts. Turner Nation? You in.
JohnnyBoy. James, Gravy train.
Come vent on me in person. I’m bringing three MAGA caps. Just for you three.

————————
I’m in! Did you let Moldova Mike know?

We’ll do some laptop forex again. Renko Gambit!

Garth you need to be there!

#124 Ian on 05.24.18 at 10:04 am

Trump cancels Korea summit.

He was complaining about NAFTA last night too so I’m sure that’s next.

#125 Conn Smythe on 05.24.18 at 10:28 am

#234 Gravy Train on 05.23.18 at 12:08 pm

“Roth on Trump, as quoted in Business Insider magazine: “[Philip] Roth said that Trump is a con artist. Roth … [said] that Trump ‘is ignorant of government, of history, of science, of philosophy, of art, incapable of expressing or recognizing subtlety or nuance, destitute of all decency, and wielding a vocabulary of seventy-seven words that is better called Jerkish than English.’”

The late Mr. Roth summed up the Trumpster very accurately. Even scarier is the thought millions of Americans love the Donald…

#126 TurnerNation on 05.24.18 at 10:31 am

Smoking man I made a note nxt Thursday Duke.

#40 what to do? Join the Party.
In the news….Toronto Council planning mandating 40% of units in new kando towers be 800-1000 square feet sized. At current prices that’s a cool million bucks. ..good for developers yes? Add .60/foot monthly kando fees.

Toronto Council also just docked funding to the Opera and Toronto Symphony. Why? These ones didn’t meet Diversity Requirements. No joke. Why they are being targeted is beyond the scope of this weblog but it’s clear to me. Total kontrol over our minds.

#127 Condos & Marijuana on 05.24.18 at 10:38 am

Who did not see this coming, ha, ‘In a multi-dwelling unit, your air isn’t your own.’ Thanks Justin your still an idiot for letting this crap happen. Next election your out with Wynne and you will have to get a real job for once in your silver spooned life.

https://www.msn.com/en-ca/news/canada/condo-boards-racing-to-clamp-down-on-cannabis-before-pot-becomes-legal/ar-AAxJoM7

#128 Ian on 05.24.18 at 10:52 am

Smoky, just talked to Moldova Mike…he’s in for Devon next Thursday! I’ll be there 4.15 on the patio.

#129 45north on 05.24.18 at 10:54 am

Randall Denley: but neither of the other major parties is promising to change the single worst policy instituted by the Wynne government.

He is saying that no party is about to change the policy of borrowing money to lower hydro bills.

The Fair Hydro Plan is like going to a pay-day loan joint to pay a basic utility bill.

http://ottawacitizen.com/opinion/columnists/denley-this-election-wont-solve-the-power-bill-problem

Political leaders are smart and they’re going along with the Fair Hydro Plan because they have to. In other words, if they don’t they will lose the election.

At some point, this policy will be reversed and people in Ontario will have to pay the cost of current electricity and the cost of past electricity. Plus interest. Wealthy people, can establish residence out of province. When the crunch comes, they move.

#130 Alistair McLaughlin on 05.24.18 at 11:02 am

@#117, and if they told your parents that in 1989, they were right for the next 7 years. Long enough for plenty of people to lose their homes.

Yes, your parents made it though just fine. You’re not demonstrating recency bias, but survivorship bias.

#131 IHCTD9 on 05.24.18 at 11:14 am

#96 jane24 on 05.24.18 at 2:25 am

Why? Can’t be socialism as some of those Northern EU counties are far more left politically with heavy tax levels but wealthy. Can’t be carbon taxes or shelling out for heat in awful winters as they have them too. Why is Canada falling down this average wage table?
_____

Sweden does big time international trade playing in big-dog industries, and win. They do it with a fraction of the population and resources we have. They are happy to extract resources as there is no better way to increase the wealth in a nation than thru this activity.

The Scandinavians seem to be the only Socialists in the world who understand that all these government services cost a mint, and they’re happy to build pipelines, cut down trees, and listen to business owners to avoid sinking their entire nation in permanent debt similar to what their southern political brethren did to themselves.

If you want the de-facto reason why they are doing better than us:

They’re smart, we’re stupid.

#132 PastThePeak on 05.24.18 at 11:22 am

#274 thelie on 05.23.18 at 5:35 pm
The lie that the rich tell themselves is that they made their life the way it is. Same as your neighbour whoes house rose by 100k last year. In truth, they got lucky. Someone making 250k is no more competent at life than a starbucks barista. They just lucked out.

You really buy into this fantasy that the rich deserve what they are “earning”. I bet its because you hang out with them a lot. The fact is that the worse you are paid, the harder you have to work for it. And that is true all the way back to slavery.

i hope one day that everyone is paid the same, and people can do whatever they want to do with their life. Until then, economic equality policies should prevent us from moving more and more to a coporatist despotism. so go ndp go.
++++++++++++++++++++++++++++++++++++

Of all the ridiculous posts on the previous blog post, I thought this one worthy of highlight.

Yep – there is absolutely nothing different between someone who obtains a well paying career and someone who doesn’t and accepts a min wage for the rest of life, except luck…and perhaps drive, hard work in school, hard work in career, or having a f*cking clue…

This guy is all you need to know about what is wrong with Canada…

#133 aa5 on 05.24.18 at 11:36 am

#97 Jane 24

Canada according to the numbers is in a slow decline, a little each year but like the frog in the hot water, one doesn’t notice. Why? Can’t be socialism as some of those Northern EU counties are far more left politically with heavy tax levels but wealthy. Can’t be carbon taxes or shelling out for heat in awful winters as they have them too. Why is Canada falling down this average wage table?
_______________________________________

Good post, data and questions.

One factor is the resource trap. Canadian governments have lots of money from resource revenues to pay big wages relative to most of the private sector. I often see very bright people working government jobs which don’t utilize their full cognitive capabilities. They get trapped in those jobs because of the higher pay and benefits relative to especially the early years working in the private sector.

Something leftists never mention is that government workers in Sweden are intentionally lower paid relative to the pay in Sweden’s high tech corporations. Sweden has about 25% higher average wages than Canada, yet Swedish teachers maybe make 70% of what Canadian teachers do.

Part of Sweden’s strategy is to drive the country’s cognitive elite into the R&D corporations, while providing huge numbers of decent paying government jobs for average intelligence Swedes.

#134 NotLegalAdvice on 05.24.18 at 11:38 am

Why is no one talking about this 30 year old millennial that doesn’t want to leave home?

https://ca.yahoo.com/news/walking-definition-entitled-millennial-swears-221554083.html

#135 Conn Smythe on 05.24.18 at 11:38 am

#124 Tony

” The Canadian housing crash is a much, much bigger house of cards than any previous housing crash in American history.”

You must be kidding Antonio. Please tell me you are. The American housing crash saw empty subdivisions filled with completed homes and no buyers. Do you see that in the GTA Tony? On the contrary, thanks to the world’s biggest, repeat, biggest, greenbelt, there is no such thing here. For there to be a bust you need demand to collapse and supply to explode. The inverse is true in the GTA.

#136 Conn Smythe on 05.24.18 at 11:39 am

https://en.wikipedia.org/wiki/Greenbelt_(Golden_Horseshoe)

#137 Mike in Edm on 05.24.18 at 11:44 am

#224 Love Guru’s Dad on 05.23.18 at 11:13 am

My take? The present proposed Transmountain pipeline route is simply irresponsible from an environmental perpespective; it passes through the back yards of over 2 million residents. Try to come up with a pipeline route through Alberta that does that.

****************************
Ummm, not 2million, but Pipeline alley which consists of literally dozens of pipelines is situated on the east side of Edmonton with a population of 1million. Never heard of it? Most people haven’t. You know why? B/c they do their job, silently, many underground, and all is well.

Pipelines do not automatically mean your environment is ruined and that they are going to leak. People need to get this through their incredibly thick skulls. I can’t remember the exact stat, but they safely transport something like 99.999994% of all product. You know what’s not as safe as that? Literally everything.

#138 Stan Brooks on 05.24.18 at 11:48 am

#112 Conn Smythe on 05.24.18 at 9:00 am

#118 Be Realistic on 05.24.18 at 9:11 am

The best thing that can happen to you in this market and this mental institution is to be left behind.

An absolute blessing for you and your kids.

GTA market well and rising? Sure.
Pass the pot.

Now I understand why T2 legalized pot, crack heads need it to continue living in their wonderland.

#139 Newcomer on 05.24.18 at 11:50 am

#95 Renter with reliable job, two kids on 05.24.18 at 1:50 am
After receiving the dreaded “termination of tenancy” papers …
Any ideas how to turn this into a win/win situation?
———

People tend to tell me we are very lucky with the place we rent. I know that it isn’t luck. When I was last looking for a place, I made a handout describing each member of our family, including our cat, our source of income, our credit rating and our references. I organized it so the highlights were easy to see and understand. I gave the handout to landlords at open houses and sent it to real estate agents. Basically, I treated it like a sales job. I had a valuable asset to offer to the best bidder. I was offering a steady, long-term, low-maintenance stream of income to whoever could compensate us with the best place.

A large percentage of renters are losers. Most landlords have had at least one experience of late rent or unreasonable damage. They yearn for good tenants. Real estate agents who manage multiple properties are likewise eager to make themselves look good by delivering perfect tenants to their clients. Keep in mind that many of the best places are never listed. They are quietly offered to prospective tenants who had applied for something else or who have just contacted the company to ask what is available.

Do your research, know your market, find the influencers and decision makers, get your name out there, and don’t settle.

#140 Stan Brooks on 05.24.18 at 12:01 pm

#137 Conn Smythe on 05.24.18 at 11:38 am
#124 Tony

” The Canadian housing crash is a much, much bigger house of cards than any previous housing crash in American history.”

You must be kidding Antonio. Please tell me you are. The American housing crash saw empty subdivisions filled with completed homes and no buyers. Do you see that in the GTA Tony? On the contrary, thanks to the world’s biggest, repeat, biggest, greenbelt, there is no such thing here. For there to be a bust you need demand to collapse and supply to explode. The inverse is true in the GTA.

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

Real estate pimps should be ashamed of their lies.

How many (as %) were the empty american homes during the US housing crash when compared to empty homes in Vancouver or empty new condos in GTA today?

US housing bubble was 1/3 of ours. period. It deflated in 2008 with only 6-7 years of growth which was much less aggressive than ours that lasted 20 + years.

The ability to lie and manipulate reality in US is much more limited due to higher number of intelligent investors per capita.

Which part of “we are screwed” is not clear to you?

Nest thing I expect from you is how our ‘free’ health care is the best in the world.

#141 Joe Bloggs on 05.24.18 at 12:05 pm

#120 Conn Smythe
“Captain Garth correctly point out that without Central banks chaos would ensue as it did in the good ol’ days prior to their implementation.”
– LOL!!! Conny dude, you just did not get the message – competition has certain advatnages for society and monopoly – none.
Just think about it for a minute before you start lecturing people with your nonsense.

#142 Leo Trollstoy on 05.24.18 at 12:14 pm

Going to Toronto next week?

Carbon Bar or The Shore Club

I’ll be there

#143 Conn Smythe on 05.24.18 at 12:18 pm

#140 Stan Brooks

“GTA market well and rising? Sure.
Pass the pot.Now I understand why T2 legalized pot, crack heads need it to continue living in their wonderland.”

The person living in his wonderland and spaced out is you Stanley. $1.33 million, closing in 3 weeks. That is the reality of the GTA. Read and weep or continue living in your delusional take on the GTA housing market.

#144 TheDood on 05.24.18 at 12:19 pm

#137 Conn Smythe on 05.24.18 at 11:38 am
#124 Tony

” The Canadian housing crash is a much, much bigger house of cards than any previous housing crash in American history.”

You must be kidding Antonio. Please tell me you are. The American housing crash saw empty subdivisions filled with completed homes and no buyers. Do you see that in the GTA Tony? On the contrary, thanks to the world’s biggest, repeat, biggest, greenbelt, there is no such thing here. For there to be a bust you need demand to collapse and supply to explode. The inverse is true in the GTA.
__________________________________________

Uh no, I don’t think he’s kidding, he’s probably correct. American household debt did not exceed American GDP prior to the crash 10 years ago – like it does here in Canada. There is no precedent for Canada’s current situation. It is indeed a sky high house of cards, ripe for an extended crash and burn.

#145 Guy in Calgary on 05.24.18 at 12:26 pm

#81 Fake News Again on 05.23.18 at 11:55 pm
Dave on 05.23.18 at 8:06 pm
CIBC reporter record profit today.

____

I wonder what the public would do if they found out….I mean REALLY found out that banks are “legally allowed” to print money out of thin air with loans and make “interest” on said loans created out if nothing.

Me thinks “quarterly record profits” would end like the ice age.
—————————————————————

Your name makes sense now.

#146 IHCTD9 on 05.24.18 at 12:31 pm

#134 PastThePeak on 05.24.18 at 11:22 am
#274 thelie on 05.23.18 at 5:35 pm
The lie that the rich tell themselves is that they made their life the way it is. Same as your neighbour whoes house rose by 100k last year. In truth, they got lucky. Someone making 250k is no more competent at life than a starbucks barista. They just lucked out.

You really buy into this fantasy that the rich deserve what they are “earning”. I bet its because you hang out with them a lot. The fact is that the worse you are paid, the harder you have to work for it. And that is true all the way back to slavery.

i hope one day that everyone is paid the same, and people can do whatever they want to do with their life. Until then, economic equality policies should prevent us from moving more and more to a coporatist despotism. so go ndp go.
++++++++++++++++++++++++++++++++++++

Of all the ridiculous posts on the previous blog post, I thought this one worthy of highlight.

Yep – there is absolutely nothing different between someone who obtains a well paying career and someone who doesn’t and accepts a min wage for the rest of life, except luck…and perhaps drive, hard work in school, hard work in career, or having a f*cking clue…

This guy is all you need to know about what is wrong with Canada…
______

I was thinking about all these lucky physicians and Doctors who never worked any harder in life than the burger flippers. They were just lucky.

Yes there are folks who inherit successful businesses without having to do all the work of building them, and there are folks who get lucky getting hired for a public sector job that pays 50% more than its equivalent in the private sector etc… – but this post is the generalization of the century.

#147 rental property math on 05.24.18 at 12:32 pm

#141 Newcomer on 05.24.18 at 11:50 am

People tend to tell me we are very lucky with the place we rent. I know that it isn’t luck. When I was last looking for a place, I made a handout describing each member of our family, including our cat, our source of income, our credit rating and our references. I organized it so the highlights were easy to see and understand.

——————
It’s got to the point with shitty tenants if I don’t see a slight write up like yours I don’t even reply to the inquiry.

Great job getting in the head of a landlord. If you had sent that to me, you’d get a reply within 3 minutes and would easily be the first pick.

#148 Howard on 05.24.18 at 12:36 pm

#112 Be Realistic on 05.24.18 at 9:04 am
There is a huge wave of Millenials coming into the housing market over the next decade; 700,000 to be exact!

The market ain’t tanking folks, find a good deal now while you can.

—————————————————

And how many Boomers will be selling over that same time period?

#149 SilverSon on 05.24.18 at 12:40 pm

#32 Shawn Allen on 05.23.18 at 7:41 pm

“Shocking because it would take let’s see umm only a bit less tan 9% compounded to turn $3 million into $25 million in 25 years.”

Doesn’t that suggest inflation has averaged just under 9% year-over-year for the past 25 years?

#150 JohnnyBoy on 05.24.18 at 12:41 pm

Oh and she calls the kettle black with Ford re party memberships? Ha now that is a laugh, I could cut and paste the liberal scandals all day long. These scandals have cost us dearly. She and her Liberal party are disgraceful for what they have done to this province.

https://www.thebeaverton.com/2018/04/liberal-scandal-kathleen-wynne-wasted-millions-on-fancy-underground-cars-for-the-toronto-elite/

https://www.thestar.com/news/queenspark/2017/09/13/kathleen-wynne-and-the-politics-of-corruption-cohn.html

http://www.cbc.ca/news/canada/toronto/gas-plant-scandal-kathleen-wynne-1.3370516

http://business.financialpost.com/opinion/joe-oliver-kathleen-wynne-switches-her-cynical-political-machine-into-fake-caring-mode

https://www.macleans.ca/news/canada/the-five-sins-behind-kathleen-wynnes-power-failure/

http://nationalpost.com/news/canada/ontario-premier-kathleen-wynne-moves-to-sue-opposition-leader-for-defamation

http://torontosun.com/opinion/columnists/wynne-liberals-broke-every-rule-in-the-book

https://www.huffingtonpost.ca/news/ontario-liberal-scandals/

#151 IHCTD9 on 05.24.18 at 12:45 pm

#147 TheDood on 05.24.18 at 12:19 pm
#137 Conn Smythe on 05.24.18 at 11:38 am
#124 Tony

” The Canadian housing crash is a much, much bigger house of cards than any previous housing crash in American history.”

You must be kidding Antonio. Please tell me you are. The American housing crash saw empty subdivisions filled with completed homes and no buyers. Do you see that in the GTA Tony? On the contrary, thanks to the world’s biggest, repeat, biggest, greenbelt, there is no such thing here. For there to be a bust you need demand to collapse and supply to explode. The inverse is true in the GTA.
__________________________________________

Uh no, I don’t think he’s kidding, he’s probably correct. American household debt did not exceed American GDP prior to the crash 10 years ago – like it does here in Canada. There is no precedent for Canada’s current situation. It is indeed a sky high house of cards, ripe for an extended crash and burn.
______

We have full recourse mortgages, they can go after everything you’ve got. Good for the Banks yes, but those suckers who end up not being able to pay the monthly will be selling their kids into slavery.

Our banks are safe, but I would not want to be that guy paying a mortgage for a house the bank took from me 20 years ago. I already know a couple folks making a vehicle loan payment for a set of wheels they sold 2+ years ago, so it’ll be same old – just financial destruction for life added on top.

Now ask yourself – how many Canadians living in our big expensive cities have dual citizenship?

It’ll be an interesting revelation if the SHTF in RE here…

#152 B20 Bust on 05.24.18 at 12:50 pm

I will just leave this here for VREU and others questioning my posts about the strong and revived south island market, and for those questioning the influence of foreign buyers.

https://www.huffingtonpost.ca/2018/05/17/victoria-hottest-luxury-market-christies_a_23437356/

When the influence of foreign capital was brought up in 2015, there was never any ‘data’ to prove its relative impact. But people liked to point out that there could not be any in Vancouver because the available data for Victoria showed that 0.6% of buyers were overseas.

Fast foward three years, and the percentage of foreign buyers is now almost 5%. Prices have gone up 50% in that that short time.

Of course, now there is actual irrefutable provincial government data – not realtor frankenumbers – on the significant impact of foreign capital on the BC market.

The waves keeps coming – they are just finding a different shoreline to hit. B20 is having no impact on the market in South Island.

#153 Newcomer on 05.24.18 at 12:52 pm

#113 Be Realistic on 05.24.18 at 9:04 am
There is a huge wave of Millenials coming into the housing market over the next decade; 700,000 to be exact!

Oh, my! What a big number! That’s impressive. For the region mentioned, that works out to a growth of about 1% per annum. Blistering! Should make for an incredible shortage. Oh, wait a minute. The death rate in Canada is about 0.75% per annum. So we are looking at 0.25% per annum, divided by household size.

#154 Tom Patterson on 05.24.18 at 12:54 pm

Bond yields are falling fast again today. The 30 year Canada bond can’t go higher than 2.51%. It tested that at least 4 times in the last 18 months.

It seems the higher interest rate train is once again a false prophecy.

#155 Calgary Rip Off on 05.24.18 at 12:55 pm

Rent vs. buy:

The reality is that freedom financially is limited. If you participate in criminality and obtain large amounts of cash, you cannot simply deal with banks. Everything is tracked. So even if you wanted to, buying a house with cash is difficult if not impossible.

Consequently, people learn how to think. Lying is rewarded on many different levels. People lie all day long.

So interest rates will go up. If the mortgage purchasers is not dumb, they did not overleverage. In Calgary if you are living greater than 5-10 years, it doesn’t equate renting for longer than that. Rents are still up. If however you enjoy the joy of dealing with landlords and perhaps moving often, then renting of course is helpful.

What is most important is learning how to think. At my daughters 16th birthday I will be giving her two books: A Bible and the Book of Mormon. Why? Both are historical documents, deal with ethics, and highlight the sacrifice God did in paying the price with His own Son, Jesus Christ. The Bible has established Rome as a powerhouse, and the Book of Mormon in the 1800s helped establish the western United States.

With correct thinking a person can learn to survive.

#156 PastThePeak on 05.24.18 at 12:59 pm

#147 TheDood
#140 Stan Brooks
#137 Conn Smythe
#124 Tony

CAD Housing crash vs. debt crisis?

Lots of people here swear that GTA and BC LML will never crash, and in fact will always go up. Others want a crash back to the 90s values. Unlikely either are correct.

As TheDood notes, perhaps focus a bit less on the specifics of housing (will it crash 10%, 50%, rise forever) and look at the debt issue. Canadians are some of the most indebted in the world – more so than Americans were during their 2008/9 crisis.

This seems to be slowly still getting worse – debt levels increasing, though slower than before. No one is considering paying off debt and lowering the ratio, as a whole. HELOCs are increasing at high single digit rates (well above inflation, interest rate increases, any now any RE increases).

The sugar coating by the media/analysts is that it is OK – debt is rising but so is “wealth” (in form of RE mostly, and some in equities). However, wealth based on market valuation can decline (somewhat, or a lot), but debt doesn’t. You still owe it, regardless if what you purchased has declined.

According to multiple stats, an increasing % of CAD households are struggling – borrowing to pay bills, no emergency cash, $200/mo away from trouble, HELOCS growing fast. And this is with interest rates still VERY low, and unemployment % very low.

You don’t have look to far – extreme indebtedness, cash flow problems already – to see that the problems could be quite large with increases in unemployment & increases in interest rates (yes, both can happen at the same time – whether inflation upticks, but also remember you don’t borrow from the BoC, you borrow from a lender who decides what % rate you pay…).

Lastly, for the housing bulls: it is one thing to convince yourself to take on a $800K mortgage when you are “sure” that the market is rising and that your home will be worth a lot more than you paid for it in a few years – than to do so when the value might stay the same or decline (even just a bit). A completely different calculation.

Yes, there will be demand in the GTA and other markets for housing, but price levels are determined by what people can afford…

#157 Tater on 05.24.18 at 1:01 pm

#118 Be Realistic on 05.24.18 at 9:11 am
#90 Stan Brooks

“700 k sounds absolutely ridiculous.

1 mil is idiotic and sign of serious societal mental illness,.

1.5 mil in places like Vaughan and Scarborough is simply indescribable.”

——————————————————————

You are gonna get left behind. Many people were telling my parents back in the 80s that 75K was absolutely crazy for their Toronto home and that 10, 15, even years on they would be financially crushed.

And no, that’s not “recency bias”. The facts are clear; MORE PEOPLE, LESS LAND.

It’s really that simple, give or take the financial nuances of the times (i.e. interest rate, unemployment, war, etc…)
—————————————————————-

If you bought the average home in the GTA in 1980 and held until 2017, your average annual return would be 6.6%. Over a time period where inflation averaged 3%. Returns would be further chipped away by maintenance and taxes. Not a great investment.

#158 IHCTD9 on 05.24.18 at 1:10 pm

#146 Conn Smythe on 05.24.18 at 12:18 pm

The person living in his wonderland and spaced out is you Stanley. $1.33 million, closing in 3 weeks. That is the reality of the GTA. Read and weep or continue living in your delusional take on the GTA housing market.
___

Useful context on this sale would be the following:

1. Move up buyers or down payment saving buyers?
2. What do the buyer(s) do for a living?

There is 1000 miles between a move up 300K income couple with 900K for a down payment, and a young 150K couple just starting armed with a minimum DP and hope.

When considering the prices in the GTA, make sure you separate move up buyers from all the others. Long time owners turned move up buyers have been saved harmless as their equity increase cancelled the price increase, their buying power has not really changed from when they 1st bought say 20 years ago.

If it were to be determined that well over half of SFD’s in the GTA were being sold to speculators and move up buyers, I would not be so quick to say “this is the new normal”. A normal RE market is built from the bottom up.

Then there are all the current interventionist policies, with a leading in the polls NDP government looking to Napalm the entire GTA market even more. It’s way too soon to even see how the current deterrents out there are going to play out.

IMHO, if the NDP gets in; we need to wait 2 years yet before we have seen enough to consider what the new normal may look like.

#159 Conn Smythe on 05.24.18 at 1:30 pm

#142 Stan Brooks

“Real estate pimps should be ashamed of their lies.”

The only person who should be ashamed is you Stanley, posting your dribble and mindless thoughts for all to see. What I just posted is not real estate pimping, just the stark reality of a current real estate transaction my better half is a beneficiary of. Listed for 1.369 million, sold for 1.33 million. Multiple offers. 3 week closing. Does this sound like a US housing crash? Read and weep Stanley.

#160 Conn Smythe on 05.24.18 at 1:36 pm

#147 The Dood

“Uh no, I don’t think he’s kidding, he’s probably correct. American household debt did not exceed American GDP prior to the crash 10 years ago – like it does here in Canada. There is no precedent for Canada’s current situation. It is indeed a sky high house of cards, ripe for an extended crash and burn.”

Dude, or rather Dood, it’s not going to happen, pure and simple. Supply is tight, demand is ongoing. No empty subdivisions, the world’s largest greenbelt surrounding the GTA. You are not comparing apples to apples. As I told Stan the Man Brooks, a recent example for your perusal. An estate sale my better half is a beneficiary of listed for 1.369 million sold for 1.33 million, multiple offers, closing in 3 weeks. Does that sound like a housing crash to you?

#161 Conn Smythe on 05.24.18 at 1:42 pm

#143 Joe Bloggs

“LOL!!! Conny dude, you just did not get the message – competition has certain advatnages for society and monopoly – none.”

Hey Joey. Another mindless one spewing off without knowing what the hell he is saying. Read your history, read Galbraith’s The Age of Uncertainty of if reading is not your thing watch his television version that was produced by the BBC. In the days prior to the Fed, the 1800s were filled with larceny on an unprecedented scale. Banks came and went like flies, notes were counterfeited like monopoly money. It was wild west finance on steroids. You are the one who is ignorant of banking history and spewing nonsense.

https://www.youtube.com/watch?v=McW2aFpJxsM

#162 Conn Smythe on 05.24.18 at 1:47 pm

#142 Stan the Man Brooks

“Nest thing I expect from you is how our ‘free’ health care is the best in the world.”

Let’s see Stanley. Princess Margaret one of the top 5 cancer research hospitals in the world… Try a serious disease like cancer States side without medical insurance and let me know how it turns out Stanley… You are a mindless moron. Pack your bags and leave cowboy, you won’t be missed.

#163 Midnights on 05.24.18 at 1:48 pm

Time to pay the Tax Man…

https://m.mortgagebrokernews.ca/news/nearly-600m-in-unpaid-taxes-uncovered-in-b-c–ontario-real-estate-sectors-242881.aspx

#164 Alistair McLaughlin on 05.24.18 at 1:49 pm

@#144, Pointing out how well your parents did with their house purchase in the 80s IS survivorship bias. Because not everyone survived the 1990s slump. I’m not arguing that buying a house is bad. Trust me, I wish I’d have bought one 22 years ago when they cost a song and people would leave them on the market for months before getting an offer. In retrospect, THAT was the time to buy. But I was still a starving student at the time and any home purchase at all seemed too risky. It was also the time to buy APPL but that is also survivorship bias. One could have just as easily picked some other exciting new tech company like WorldCom. In fact, pointing out how well the S&P did is a form of survivorship bias. I chose to put money in Japan in 1995. You can imagine how well that worked out. Not all stock markets were money making machines between then and now.

My only argument is to counter your argument, which seems to be that housing can keep going up forever. No, it can’t. It only seems like it can because we’ve had 30 years of falling interest rates. That credit cycle might be ending. And if it doesn’t end, that’s because the economy is once again in the $hitter. And housing doesn’t do well when the economy is in the $hitter.

So either credit starts to tighten and housing won’t do well (see Canada circa 1990), or the economy tanks and rates go down and housing doesn’t do well (see Japan circa 1990). But the 20 year bull run is over. It ended last year. If you don’t believe me, take a look at household debt figures. Nobody knows the natural limit of household debt is, but we can guess that it’s not infinitely above 100% of GDP.

By the way, despite the greenbelt restrictions, new home construction has exceeded new household formation in the GTA for the past decade. In English, it means more homes were built than there were new families to fill them. The excess supply was easily soaked up by speculators who think they’re property “investors”. Classic bubble behaviour.

#165 Be Realistic on 05.24.18 at 2:04 pm

#146 Conn Smythe on 05.24.18 at 12:18 pm
#140 Stan Brooks

“GTA market well and rising? Sure.
Pass the pot.Now I understand why T2 legalized pot, crack heads need it to continue living in their wonderland.”

The person living in his wonderland and spaced out is you Stanley. $1.33 million, closing in 3 weeks. That is the reality of the GTA. Read and weep or continue living in your delusional take on the GTA housing market.

——————————————————————

They don’t get it Conn … they just don’t get it.

#166 Duke on 05.24.18 at 2:09 pm

#6 Doom Incarnate on 05.23.18 at 5:55 pm
Since I now apparently have twins on the way, I sure hope that real estate crash comes soon to my town so I can get a bigger place for the mewling babes in short order. The money’s in place. I just need the prices to meet my needs. Or I could rent a house. Or stay where I presently am in a too small paid off condo.

Hmmm…

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

Hang tight, sir. You will have an opportunity before your twins celebrate their 2nd birthday.

#167 Fake News Again on 05.24.18 at 2:10 pm

Conn Smythe on 05.24.18 at 9:06 am
#83 Fake News Again

“The United States of America did JUST FINE without a “PRIVATE” central bank for nearly 150 years. Then the world was taken to the cleaners and it has been nothing but “RECORD PROFITS” for banks ever since.”

Do yourself a favour and read The Age of Uncertainty by the late great Canadian economist John Kenneth Galbraith. In it you will see what kind of larceny took place in the good ol’ US of A before they had a central bank. Banks could print their own currency and it was the wild west on financial steroids. Your comment is quite laughable. If reading isn’t your thing, Galbraith made a tv series out of his book and it aired on the BBC. Utube has all the videos.

https://www.youtube.com/watch?v=McW2aFpJxsM

_____

So your suggesting things are “hunky dory” today with the way Private Central Banks “control economies” around the world? 120 TRILLION dollars in FAKE money created out of nothing with interest owed to the criminal bankers? How is that type of system working out for you?

#168 Proof ? on 05.24.18 at 2:11 pm

to # 103 Ian

Happy Birthday !
(sorry if you are not a celebrator of such)
At our ages, the years go by fast.
Hope you have a good one !

#169 Confessions on 05.24.18 at 2:12 pm

sorry to pi$$ on your party. at least you are stubborn and persistent

http://www.dailymail.co.uk/news/article-5768295/House-prices-nation-rise-NINE-percent-one-year-fuel-fastest-growth-12-years.html

#170 Fake News Again on 05.24.18 at 2:14 pm

Conn Smythe on 05.24.18 at 1:47 pm
#142 Stan the Man Brooks

“Nest thing I expect from you is how our ‘free’ health care is the best in the world.”

Let’s see Stanley. Princess Margaret one of the top 5 cancer research hospitals in the world… Try a serious disease like cancer States side without medical insurance and let me know how it turns out Stanley… You are a mindless moron. Pack your bags and leave cowboy, you won’t be missed.

________

Go look in the mirror before you call people names Con Man. Cancer is completely curable but there is NO PROFIT for the bankers in a disease that is curable. Many many doctors/scientists have been murdered that have found cures. Yes yes….I am sure your linear thinking will call that a CONSPIRACY THEORY right?

#171 Alistair McLaughlin on 05.24.18 at 2:15 pm

Must be all those millennial buyers emerging from their parents’ basements to embrace home ownership:

https://www.thestar.com/business/real_estate/2018/05/23/new-home-sales-in-gta-hit-20-year-low-in-april.html

Haider & Moranis in the Financial Post don’t seem to grasp something – “kids” still living in their parents’ basement at age 35 aren’t likely to become independent adults with mortgages and high paying careers at age 39. They might tell themselves they’re just delaying their launch into homeownership, but delays tend to become terminal after a certain age.

Peak millennial is now. Not five years from now. And it won’t support the market by itself.

#172 Proof ? on 05.24.18 at 2:23 pm

to # 127 Conn Smyth

Roth was a FICTION writer.
Not an economist, not a financial guy, not a politician, etc.
He wrote fiction of a questionable quality and often offensive content and was a “sensationalist” writer at that.
He was obviously therefore “talking his book” in his hyperbolic take on all things Trump.
Like that idiot Robert DeNiro.
Your appreciation of a fiction writer’s opinion of Trump confirms my suspicion from your previous posts that you are a small minded individual indeed, including your smugness.

#173 WUL on 05.24.18 at 2:31 pm

Perhaps a brawny former Minister of National Revenue can shed light on this. I would solve the problem myself but with my flagging strength, I cannot lift the Income Tax Act off the shelf as it is compendious.

Advice from a bank:

Person A dies while holding a TFSA. Person B is the spouse of A and is named as the “Successor” to the TFSA. The account sits for a month following the date of death.

B does not want a transfer in kind to their own TFSA but rather wants to collapse it and obtain the monies to hand it to children.

Tax is payable on the amount earned in the TFSA for the month following the date of death. So, tax free gains on the TFSA are not allowed to an estate when the account is collapsed rather than taken over as a TFSA by the named successor.

No biggie for one month but if the account were to sit for a year or two before the successor collapses it, the taxes might be a different matter.

Anyone? Thx in advance.

#174 Conn Smythe on 05.24.18 at 2:33 pm

#173 Fake News Again

“Go look in the mirror before you call people names Con Man. Cancer is completely curable but there is NO PROFIT for the bankers in a disease that is curable. ”

You are a complete joke. Try being told you have cancer and then decide what you want to do. Whether it is completely curable or not, at this stage one has to go with the options that are available. In the GTA it is Princess Margaret and I know from personal experience with an immediate family member. When your life is on the line it is a whole different ballgame. What would you do if you were told you had cancer? Please elaborate or wise one…

#175 Conn Smythe on 05.24.18 at 2:37 pm

#170 Fake News

” How is that type of system working out for you?”

Very, very well Faker. Life couldn’t be better. Not working our for you? Central banking is like what Winston Churchill said about democracy, it is the worst form of government except for all the others…

#176 Proof ? on 05.24.18 at 2:40 pm

to # 163 “Con” Smyth

Hey dummy, the subdivisions emptied AFTER the crash began, not before.

My bet is you vacate this blog pretty quickly once that “crash” begins.

Disclaimer: I own outright significant development lands ( total over 190 acres) within the city limits in several communities around Toronto. I am deferring all further development as a result of what I and other major land owners see – and it ain’t a continuation of this pricing regime I can tell you.

By your own admission you operate a school – you know sweet f*&#k all about the RE market dynamics in play.

And no, owning a house in Toronto or recently being a party to a sale does not make you any kind of expert on the subject.

#177 Conn Smythe on 05.24.18 at 2:40 pm

#168 Be Realistic

“They don’t get it Conn … they just don’t get it.”

Sadly true. They can harp on all they want and hope for a GTA crash but reality is another matter. First hand evidence is presented and ignored…

#178 Howard on 05.24.18 at 2:43 pm

So go and buy a bunch of $600K glass boxes, Con(n) Man. Have fun.

#179 Conn Smythe on 05.24.18 at 2:49 pm

“Useful context on this sale would be the following:”

1. Move up buyers or down payment saving buyers?
2. What do the buyer(s) do for a living?

Sorry, don’t have that info but good questions. They must have wanted it really bad because the closing is a mere three weeks.

#180 Tater on 05.24.18 at 3:00 pm

#154 IHCTD9 on 05.24.18 at 12:45 pm
#147 TheDood on 05.24.18 at 12:19 pm
#137 Conn Smythe on 05.24.18 at 11:38 am
#124 Tony

” The Canadian housing crash is a much, much bigger house of cards than any previous housing crash in American history.”

You must be kidding Antonio. Please tell me you are. The American housing crash saw empty subdivisions filled with completed homes and no buyers. Do you see that in the GTA Tony? On the contrary, thanks to the world’s biggest, repeat, biggest, greenbelt, there is no such thing here. For there to be a bust you need demand to collapse and supply to explode. The inverse is true in the GTA.
__________________________________________

Uh no, I don’t think he’s kidding, he’s probably correct. American household debt did not exceed American GDP prior to the crash 10 years ago – like it does here in Canada. There is no precedent for Canada’s current situation. It is indeed a sky high house of cards, ripe for an extended crash and burn.
______

We have full recourse mortgages, they can go after everything you’ve got. Good for the Banks yes, but those suckers who end up not being able to pay the monthly will be selling their kids into slavery.

—————————————————————-

No. If you go bankrupt, the difference between your house value and the mortgage balance is an unsecured debt. It can be discharged and you basically walk away. Any non-registered savings will be wiped out, but the debt dies.

For people who are in over their heads, with limited assets outside of their home, it makes sense to declare bk.

#181 Stan Brooks on 05.24.18 at 3:02 pm

Conn Smythe on 05.24.18 at 1:47 pm
#142 Stan the Man Brooks

“Nest thing I expect from you is how our ‘free’ health care is the best in the world.”

Let’s see Stanley. Princess Margaret one of the top 5 cancer research hospitals in the world… Try a serious disease like cancer States side without medical insurance and let me know how it turns out Stanley… You are a mindless moron. Pack your bags and leave cowboy, you won’t be missed.

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

So I wish you get cancer and get treated at Princess Margaret Hospital for it.

A friend of mine had cancer in his family in Canada and it was horrific experience. Asked him about his bills going to US and Europe.

Luckily it worked well for him/treatment outside Canada.

By the time you wait in line (after and if your ‘primary care provider’ eventually approves of the screening for it) it most likely will be terminal, stage 4.

But hey, not doubt, terminal cancer patient (dispatching) facilities in Canada are good.

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

#168 Be Realistic on 05.24.18 at 2:04 pm

That is what I am – realistic.

You are delusional and wishful thinking.

House is a place to live, not an investment.

And I speaking realistically about the coming housing correction. Take your stupid head out of your but.

#182 Stan Brooks on 05.24.18 at 3:10 pm

Conn Smythe, Be Realistic,

I will appreciate ANY factual arguments against the coming housing marker crash the like of which the world has never seen in GTA and Vancouver.

I presented numbers and analysis above and all I get is ‘believes’ and ‘come on, be realistic, this is world class city, blah, blah, blah. ‘.

You have absolutely no idea how amusing and entertaining you are when looked from aside with all these superiority (small dick) complexes and FOMO bull crap, while clearly having no clue what you are talking about.

It gives me orgasmic schadenfreude just realizing how screwed the likes of you really are.

So I will just wait until it hits the fan.

And then, oh boy, and then…..

#183 Shawn Allen on 05.24.18 at 3:28 pm

Wealth Returns versus Inflation

#152 SilverSon on 05.24.18 at 12:40 pm quoted me and then asked a question:

#32 Shawn Allen on 05.23.18 at 7:41 pm

“Shocking because it would take let’s see umm only a bit less than 9% compounded to turn $3 million into $25 million in 25 years.”

Doesn’t that suggest inflation has averaged just under 9% year-over-year for the past 25 years?

***********************************
It’s a good question. But no a 9% return does not tell you what the inflation rate was.

The point was that 25 years ago it too $3 million to get into the ultra high net worth club and today it tales $25 million.

Part of the reason is certainly inflation.

According to Statistics Canada inflation has compounded at 1.8% for the last 20 years.

http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/econ46a-eng.htm

Even if it averaged 3% in the 25 years that would cause $3 million 1993 dollars to be worth the same as $6.3 million 2018 dollars.

Now many people refuse to believe the official inflation data because they see things like food and certainly housing that have risen faster. Well, Statistics Cananda shows all the various components and anyhow why I have no reason to believe the inflation data is not calculated honestly. I do know that in 1997 I bought a Dodge Grand Caravan in Edmonton with such exotic options as power door locks, power steering and power brakes. I cost me right around $23000 on sale before tax and you can get a 2018 model that is a LOT better quality for the same price.

I googled 2018 Dodge Grand Caravan best price and one pooped up near me for 22,998. So, that is zero inflation on that product. And, that 1997 version was a low quality vehicle. They have far better engines today.

But people believe what they want to believe.

The fact that it now takes $25 million to be ultra high net worth speaks to the returns that the richer people have made on their wealth. It is a fact that the rich have gotten richer at a faster rate than the middle class and poor. It probably also speaks to asset inflation. Land and houses have appreciated at higher rates than CPI inflation.

#184 Shawn Allen on 05.24.18 at 3:34 pm

Wealth and money are often confused.

Money, technically is the liquid spendable stuff and consists of paper cash and (mostly) bank deposits. A bank deposit is “money” whether anyone likes that or not. I believe a government treasury bill can also be counted as money.

Wealth is measured in units of money but typically consists mostly of non-monetary assets such as stocks, houses , land , private businesses, bonds and lots of other things. That does not make the wealth any less real, but most wealth is not money as such.

A house is measured in monetary value but is certainly not money.

A three year government bond can be considered to be an investment in future money of a know quantity but is not money as such.

#185 maxx on 05.24.18 at 3:35 pm

#115 20% Discount on 05.24.18 at 9:07 am

Doubtful……2 direct (as yet unsold) comparables are at 20 and 36% higher in price than the original list on this one.

Sorry.

#186 Alistair McLaughlin on 05.24.18 at 3:44 pm

@ #173 Fake News Again:

Bankers make money from people dying of cancer?

Your parents didn’t let you play with plastic bags when you were a toddler did they?

#187 jess on 05.24.18 at 3:52 pm

resolution foundation

The Resolution Foundation, a nonpartisan British think tank that researches policy solutions to improve low- to middle-income citizens’ living standards, suggested additional staggered inheritance payments for older Britons starting with people turning 35 in 2020. The report notes that six in 10 U.K. millennials currently in their late 20s would see their wealth nearly doubled by receiving the £10,000 investment from the government. The payment would serve as a stepping stone to reduce a drastic economic imbalance between baby boomers and their younger millennial and Generation Z counterparts.

“Younger generations are bearing more risks and holding fewer assets than their predecessors. We need to redress that imbalance if we are to maintain the promise of an asset-owning democracy,” reads the report, released Tuesday. “No longer can anyone deny the challenge facing us as a country in maintaining a fair deal between the generations,” said Lord David Willetts, a Conservative Party politician who commissioned the report. “If the evidence is so powerful then that means there is an obligation to act.”

https://www.resolutionfoundation.org/

#188 jess on 05.24.18 at 4:00 pm

In the last cycle, temporary employment peaked in late 2005, two years before the recession hit.”

https://www.wsj.com/articles/temp-worker-freeze-bodes-ill-for-economy-1463941529

https://fred.stlouisfed.org/graph/?g=4z6S
temps through staffing agencies has been rising, hitting an all-time high at the end of last year.

https://fivethirtyeight.com/features/stuck-in-your-parents-basement-dont-blame-the-economy/

#189 jess on 05.24.18 at 4:10 pm

Chain of Title
How Three Ordinary Americans Uncovered Wall Street’s Great Foreclosure Fraud

David Dayen

…”they revealed how the financial crisis and subsequent recession were fundamentally based upon a series of revealed the frauds that kicked millions out of their homes because of false evidence by mortgage companies that had no legal right to foreclose.

the collapse of the rule of law in the home mortgage industry.”

Democracy Now!

Amy Goodman talks with author of Chain of Title, David Dayen, in regards to President-elect Donald Trump’s cabinet picks Steven Mnuchin and Wilbur Ross for Democracy Now!
See more

Dissent Magazine

Mike Konczal reviews Chain of Title in Dissent Magazine
See more

The Philadelphia Inquirer

Jake Blumgart reviews Chain of Title in The Philadelphia Inquirer
See more
https://thenewpress.com/books/chain-of-title

#190 Guy in Calgary on 05.24.18 at 4:11 pm

#274 thelie on 05.23.18 at 5:35 pm
The lie that the rich tell themselves is that they made their life the way it is. Same as your neighbour whoes house rose by 100k last year. In truth, they got lucky. Someone making 250k is no more competent at life than a starbucks barista. They just lucked out.

You really buy into this fantasy that the rich deserve what they are “earning”. I bet its because you hang out with them a lot. The fact is that the worse you are paid, the harder you have to work for it. And that is true all the way back to slavery.

i hope one day that everyone is paid the same, and people can do whatever they want to do with their life. Until then, economic equality policies should prevent us from moving more and more to a coporatist despotism. so go ndp go.
—————————————————————

A doctor should be paid the same as a barista? What?

#191 jess on 05.24.18 at 4:15 pm

reverse mortgages hope this shite doesn’t happen here

DAVID DAYEN: Right, so they are both—I call them profiteers because they, like most banks and mortgage servicing companies, just profited from the lack of attention to the foreclosure crisis at the federal level. Mnuchin foreclosed on 36,000 people—in California alone. He foreclosed on much more through OneWest Bank, where he was CEO. And Wilbur Ross, through American Home Mortgage Servicing, which eventually became a company called Ocwen, also did so, and they did so illegally. These were fraudulent foreclosures, where fake documents were used to prop up those foreclosures. There are depositions with individuals from OneWest Bank saying that they spent 30 seconds looking at foreclosure files before signing affidavits that said that they knew everything in that file and reviewed all the business practices. There were forged documents routinely from Wilbur Ross’s American Home Mortgage Servicing. They were done by a third-party company known as DocX, where the CEO of that company actually is in prison right now, went to prison for five years for forging millions of mortgage assignments to be used as evidence in court cases all over the country. So, these were very normal practices, but it’s very ironic that the Obama administration kind of lost track and didn’t pay attention to this crisis that was going on. And now, after Trump’s election, he brings in two people who profited almost the most from that to help run his Cabinet.

#192 Conn Smythe on 05.24.18 at 4:26 pm

#185 Stan the Man Brooks

Stanley, you are a deranged puppy. I presented you with a real actual home sale that went down last weekend in Toronto. Multiple offers, 3 week closing, 1.33 million. You can continue to believe in your delusional scenario of a Toronto housing crash. You are a lost basket case. Hope meds can help and you can get good care in some good psychiatric ward. The blog dogs will come and visit…

#193 Conn Smythe on 05.24.18 at 4:32 pm

#184 Stan the deranged lunatic Brooks

“So I wish you get cancer and get treated at Princess Margaret Hospital for it.”

How very nice of you Stanley. Great for all to see what a total a$$hole you really are. I had an immediate family member treated at Princess Margaret and they were world class and all ended well. No need to go to the States. You are truly a piece of garbage. I am lowering myself engaging in dialogue with a scum bag like you Stanley.

#194 Conn Smythe on 05.24.18 at 4:37 pm

#181 Howard

“So go and buy a bunch of $600K glass boxes, Con(n) Man. Have fun.”

No need Howie. Bought my properties, yes plural, years ago and have enjoyed fabulous capital gains over the years. Primary residence tax free. Getting fabulous rents on my rentals. Also have investments outside of real estate.

#195 Conn Smythe on 05.24.18 at 5:59 pm

#179 Proof

Please direct me to the empty subdivisions in the GTA. Demand in the US disappeared. Hence the empty subdivisions. Will there be a pause? Sure. Will there be a crash, US style? Not a chance cowboy. Toronto is the 3rd largest metropolis after only NY and LA surrounded by the world’s largest greenbelt. It is still cheap by international standards. Students at my school from China tell me what prices are like in Shanghai and Beijing. Toronto is a bargain by comparison… Who made you the crystal ball gazing real estate crash expert?

#196 Conn Smythe on 05.24.18 at 6:13 pm

#175 Proof?

I happen to agree with what Roth said about Trump. Are you saying writers like Roth can’t form an accurate opinion? I couldn’t care less what he wrote, I am not a fan of Roth’s writings. My opinion of Trump is grounded on what I think of him. I don’t need Roth or anyone else to form my opinion. Small minded? Sounds like your hero Trump. The intellect of an oragutan and the hair to match…

#197 TOny on 05.24.18 at 8:02 pm

Re #127 ConnSmythe

The debt levels are much, much higher in Canada than they were when the America housing market last crashed as well wages have severely lagged in Canada.

#198 Proof ? on 05.25.18 at 3:52 am

to # 198 “Con” Smythe

See Garth’s next posting.

New construction home sales 70 % below the 10 year average sales level and sales Y / Y same segment down 65 %.

Empty (as in plenty of empty lots with no new sales) subdivisions are already demonstrably here.

Do you think the land is free ?
It represents very substantial sunk cost before you can even sell the lots , let alone build the houses.

THE LAND COST IN CANADA EXCEEDS THE BUILT OUT COST IN THE USA !!!

Ergo, unbuilt (empty) subdivisions in GTA often have more money committed than US subdivisions have in the TOTAL built out costs, without the cashflow of sales for years!

Accordingly, the “empty subdivisions” signal exists in the GTA , it just appears differently.

Stick to your “school” business, you don’t know shit about current development RE dynamics.

#199 Conn Smythe on 05.25.18 at 8:17 am

#210 Proof

“Stick to your “school” business, you don’t know shit about current development RE dynamics.”

Aren’t we in a giddy mood today? Yep, all those cranes over the GTA building condos, going to see lots of empty condos I guess. Or the urine smelling bungalows that go for $900k just for their lot value. The third largest metropolis next to LA and NY. Is there going to be a pause, sure I buy that. A crash? No way Jose. Let me quote Benjamin Tal ( I know, he’s a shill for the real estate industry, blah, blah, blah).

“We are underestimating the number of immigrants coming to the city. We don’t have the sufficient supply due to government regulations. The rental market is extremely tight. If we don’t deal with the supply issues then we aren’t dealing with the real housing problem. If you think this city is expensive today, just wait ten years and see how unaffordable it becomes because we are not dealing with the supply issue.”

#200 Shawn on 05.25.18 at 10:02 am

Big USDCAD breakout underway. I think we’re going to 1.40

US tech leadership firmly in place.

qqq > spy > vwo > xiu > vgk

Overweight US equities