The write-off

  “Here’s the mandatory suck up,” writes Rob (everyone is so well trained now). “I bought The Money Road years ago at the Calgary airport, read the book on a flight to London, and have been a daily blog reader ever since, learning a lot and keeping my finger on the economic pulse. Thanks for your great work.

I’d be interested in your view on our situation.

My wife and I, both 48 years old, with a young child, have about $270,000 invested in an ETF portfolio, held in maxed out TFSAs, and RRSPs with about $50k of it unsheltered. My wife has a medium sized pension, I have none. We have a new house on 6 acres on Vancouver Island that has farm income of about $6k / year net, low farm status property taxes, plus all we can eat organic veg and fruit. I built the house myself with a lot of blood and sweat. Not a cornflake throw away.

In the current market, the house and land are apparently worth about $650k. We have a private mortgage of $183k at a fixed rate of 3.70%, payable to my 80 year old parents. Our current combined gross income, excluding the farm income, is $$88,000, split roughly 50:50.

My question is, what are the pros and cons of using part of the portfolio to pay off the mortgage and then taking out a HELOC and borrowing money against the house to replicate the portfolio or even increase it and thereby making the interest tax deductible? Is this a reasonable idea? I’ve owned a sold a small business and so I’m not risk adverse but I’m also not a gambler at this point in life.

Of course you should pay back your elderly parents – that’s job one. The 3.7% they’re getting from you now is above GIC rates, but below what a stable preferred-share ETF could provide. Besides, all the interest you pay is 100% taxable in their hands, whereas dividends gain better tax treatment. In any case, they’re 32 years closer than you to departing this mortal coil so maybe they just want to blow that money on clubbing and a new Mercedes – or oxygen and motorized wheelchairs. Whatever. Pay it back, dude.

As for your strategy, yup, works just fine. The TFSA assets can be sold with no tax consequence, but any RRSP liquidation will be taxable (you’re in a 20% bracket). If you borrow against your property, count on a secured line of credit for 65% of the appraised value – or about $420,000. The payments need be interest-only, which means 100% of them can be deducted from your taxable income. So, why pay this money back?

More in a minute. First, Regi has a similar question. But no suck-up.

My wife and I (in our early 40’s) can be described as a couple of DINK’s making a solid effort at achieving early retirement. We save a substantial portion of our take home income and have loaded up our RRSP’s, TFSA’s, and non-registered funds into low cost index funds.Life is good! We currently have zero debt, our Calgary townhouse is mortgage free, but we have a HELOC of $300k @ prime that is currently begging to be invested.

My question to you is that my wife and I struggle to determine if these HELOC funds would be best invested in the market with the hope of exceeding the current interest rate, thus putting our house to work! We struggle with the risk/reward proposition, but I feel that if we sold the house and simply rented we would have already invested those funds, so the only issue is the premium associated with paying the bank the current 3.45% premium for the privilege to access these funds.

What are your thoughts on investing HELOC funds into the market? If our timeline is 10 years or longer would it make sense to put these funds to work?

We live in a unique time, of course. Cheap rates and racing hormones drove real estate values to historic highs. The tax code and willing bankers let you access that windfall equity through a secured LOC. So long as the money you borrow is used to produce taxable income, the cost of that loan can be completely deducted. So the higher your income, the greater the benefit (like an RRSP). It means the rich – those making over $240,000 – can borrow and reduce the effective rate by 53%. For regular schmucks, the saving is around 30%.

So, Regi, that cheap 3.45% loan rate is more like 2.4%. Even modest portfolio gains would put you in the black. This contrasts with sitting on real estate equity doing nothing, especially if house values plateau or fall. Dead money is made alive again. Hallelujah.

But, of course, there are risks. This is not suited to everyone. You must know the rules.

(a) It’s a long-term strategy. Markets and portfolios ebb and flow from month-to-month and over years, so borrowing to invest means taking the long view. Never do this if the funds are needed in a year or two, when you might be forced to sell in a down cycle.
(b) Invest correctly – in a balanced, diversified, liquid portfolio. Buy ETFs, not stocks (or mutual funds). Have multiple assets classes (equity, REITs, bonds, preferreds etc). Invest globally – not all in maple or Trump. Stick with 60/40. It works.
(c) Get an advisor if the bucks involve warrant it. Less stress. More professionalism. And the fee is tax-deductible, also.
(d) Don’t worry too much that the debt’s not being reduced. Interest is deductible. Principal payments are not. With a liquid portfolio you can repay the loan at any time, should interest rates spike or your spouse looks murderous.
(e) Track the interest charges carefully so they can be claimed when filing the income tax return. If the payments are interest-only (the most sensible) the accounting is simple.
(f) Ignore skeptics who tell you only assets that pay regular income (like bonds or preferreds), and not those which provide capital gains (like equities), are eligible for this kind of interest-deductible portfolio. They’re wrong.
(g) If you worry about borrowing to invest, freaking out with every market gyration, then don’t. It’s not worth it. Odds are you’d sell at a loss if a big drop occurs. Remember that human nature is the enemy of investing. We crave what’s going up and flee when things decline. Smart folks do the opposite.
(h) Be confident. Markets and asset values rise more than 70% of the time. Even during the 2008-10 financial crisis a balanced portfolio returned an average of 5% a year while stock markets cratered 55% and took seven years to recover. Besides, there’s no 2008 coming. Seriously. If wrong, I’ll totally refund the subscription fee to this blog.

81 comments ↓

#1 Mish Delhumme on 09.03.18 at 4:52 pm

First!

#2 Matt on 09.03.18 at 4:57 pm

Thanks Garth!

Appreciate the words of wisdom, when all my 20-something friends are buying houses and laughing at me for renting in the beaches for $2400 a month (all in)

Keep up the great reads!

Matt

#3 Tom from Mississauga on 09.03.18 at 5:01 pm

Nice to see you’re not worried about being out of NAFTA. Maybe Garth you think a member of Congress will risk voting against improved trade deal with Mexico a day before going to the polls?

#4 Adrian on 09.03.18 at 5:16 pm

Van detached listed at $750,000
haven’t seen that in a loooong while:
https://www.zolo.ca/vancouver-real-estate/7818-main-street

#5 Troy McClure on 09.03.18 at 5:46 pm

As you so often remind us, a HELOC is a demand loan. What’s the chances of the market taking a downturn and the bank demanding the HELOC be paid during that downturn?

#6 Leo Trollstoy on 09.03.18 at 5:52 pm

Tried FIRE. Didn’t like it

Like Gartho said, if you like your work, why retire?

People who try to convince me otherwise are poor and definitely haven’t retired

Sucks to be them

#MAGA!

#7 Chico on 09.03.18 at 5:56 pm

#199 KLNR on 09.03.18 at 3:52 pm

@#168 IHCTD9 on 09.03.18 at 11:12 am

True enough.
Canada has always been a country of centrists. skew to far right or left and you won’t get many votes. Thats why the libs hold power for so long and why scheer is acting the way he is. Thats why harper muzzled all the back benchers in his party. Canadians don’t like the lunatic fringe.
Really wish T2 would have changed the voting system.
Would better reflect who Canadians want to govern.
Also make voting mandatory – really sad when half the country doesnt vote then starts whining about their gov

—————————————————————

You said “Canadians don’t like the lunatic fringe.” You then say we should make voting mandatory!

You sound like the lunatic fringe.

#8 Bytor the Snow Dog on 09.03.18 at 5:57 pm

48 years old? With a young child?

What is this world coming to? Thanks Feminism.

#9 TurnerNation on 09.03.18 at 6:01 pm

Ontariowe hired King Ford the Union Buster. The mood here is darker than Smoking man’s liver.

– He’s seeking to privatise Toronto’s transit money pit, booting its unions in the process.
– Set up snitch lines for tighty righties to call when their public union educator strays into NWO sex ed territory.

Why? Infrastructure plays will follow this. The major pension funds – Canada’s top capital chasers – put a schism in their capital -ism and uploaded tons of global infrastructure plays in recent years past, lately, of late; like, now.

This means they see global equity markets likely as fairly/fully valued.

(Charging uncapped “user fees” to the tax farm slaves under the guise of providing essential infrastructure, is good business. See: Toronto airport’s highest landing fees – in the world.)

#10 crowdedelevatorfartz on 09.03.18 at 6:02 pm

@#197 IHCTD9
“Wow, RBC report says half a million. Why such a massive discrepancy?”
+++++

Gee the CBC filing another Trudeau “news” report that tries to minimize the debacle of failed NAFTA talks?

Say it aint so.

I cancelled my tv cable in BC a few years back due to the endless Global TV pandering to the Christy Clark Liberals. The propaganda was so one sided and revolting it infuriated me to be paying money for what some wags out here dubbed “Goebbel TV”.
But I am a news junkie.
My digital antennae only brings in a few channels…..one of which, unfortunatly is ….The CBC.
ENDLESS pandering to the federal Liberal Party agenda. If it isnt a gender neutral visible minority saving the environment….it doesnt get air time…..usually 10-15 minutes of prime time prattle with loaded questions gently lobbed to the “expert” being “interviewed”.

That and endless interviews with angry university professors spewing their one sided vitriol about Trump, gender issues or some other pro business announcement.
And to top it off, Sunday evenings at Prime Time 6pm the CBC BC English channel shows…….cartoons……

While the CBC BC French channel has….. 6pm News.
The CBC French channel sucks up $6,000,000/month for what stats Canada estimates are less than 4000 french speaking only francophones as opposed to the 3 million english speaking taxpayers of BC….

The CBC …..
….. its own worst enemy and if they think Harper was bad…..wait til the next Conservative Prime Minister gets his( or her) hands on the purse strings.
I for one, will not regret the long overdue demise of “The Corpse” and their thinly veiled anti business luddite agenda.

#11 crowdedelevatorfartz on 09.03.18 at 6:06 pm

@#4 Adrian

Its a classic Realtor scam.
Drop the price well below current market prices and wait for the Greaterfools to bid war it to the stratosphere…
Final sales price?
Higher than estimated….and another idiot is soon parted from their money.

Wait until ALL the listings are $750k……… moo hooo haa haaa haaaaaaaaaaaaa

#12 Sept. 5 on 09.03.18 at 6:31 pm

Rates going up again Sept. 5?

The silence of debt slaves lately is deafening.

#13 NoName on 09.03.18 at 6:31 pm

This is so funny.
https://youtu.be/z1YP_zZJFXs

#14 Zapstrap on 09.03.18 at 6:32 pm

#11 crowdedelevatorfartz on 09.03.18 at 6:06 pm

@#4 Adrian

Its a classic Realtor scam.
Drop the price well below current market prices and wait for the Greaterfools to bid war it to the stratosphere…
Final sales price?
Higher than estimated….and another idiot is soon parted from their money.

Wait until ALL the listings are $750k……… moo hooo haa haaa haaaaaaaaaaaaa

Think it wiould take a while but wouldn’t be surprised to see it …

#15 Chico on 09.03.18 at 6:42 pm

#186 Stan Brooks on 09.03.18 at 1:28 pm

I don’t think we are far from a complete economy meltdown, it becomes more and more likely by the day and soon will be probably a certainty.

————————————————————

You should pen a daily devotional. Are you really Freedom First after all? I’ve been wondering about that lately. Freedom disappeared and shortly thereafter Stan appeared. Railing nonstop about everything but his own shortcomings. Sounds like Freedom, just no more bashing of women.

#16 Spectacle on 09.03.18 at 6:46 pm

#11 crowdedelevatorfartz on 09.03.18 at 6:06 pm
@#4 Adrian

Its a classic Realtor scam.
Drop the price well below current market prices and wait for the Greaterfools to bid war it to the stratosphere…
Final sales price?
Higher than estimated….and another idiot is soon parted from their money.

~~~~~~~~~~~**~~~~~~~~~~

“And parted from their financial future!”

The pain will be enduring and enormous for them.

#17 Grateful Boomer on 09.03.18 at 6:49 pm

Hey Lawless, whew, talk about Labour Day…scrolled through over 200 comments from yesterday’s blog in the hope of seeing your response to Garth’s request. You know ….share how you able to pull together 625k in 3 yrs in the big city,with 2 kids after living expenses

#18 Wrk.dover on 09.03.18 at 6:49 pm

CBC/Comatose By Crap. Where Canadian individuals go to find out what they themselves think. They can’t know what to think, left on their own to decide. Most don’t think. Much or often.

Next step, legal government dope to watch CBC on.

Like: Oh Wow Man…Far Out!

#19 Nonplused on 09.03.18 at 6:53 pm

What’s with all the people writing in lately that don’t really have any financial problems? It’s not nearly as much fun as the bozos. Maybe all these years of effort and Garth has actually managed to educate an entire nation?

#20 Freebird on 09.03.18 at 7:00 pm

Timely. HELOCs are popular and we looked at this.

There are various reasons why a 48 yo couple/person would have ‘young’ children…by choice or ‘oops’ (life happens), adoption, fostering, through death of lived one or friend and grandparents/family taking over parenting role even w/bio parents still alive but unable to properly care for the child/ren. Im guessing the family from the email is by choice. My mom and dad were older when they had me over 50 yrs ago. Life didnt end and all was fine.

#21 mark on 09.03.18 at 7:19 pm

I love how late 90’s this blog looks with the poorly aligned bylines at the top now, reminds me of the last time I read a Northern BC newspaper. Seriously man, if you went to one of those mobile fancy re-adjustable ones I think I’d be devastated.

#22 Karl on 09.03.18 at 7:22 pm

I’m in a similar situation and would consider using my substantial home equity to invest in a diversified/liquid portfolio.

Garth, I would probably go with you and Co. to manage this. Do you work with people like me and Regi, or do you tell us to sell our house and get out? Asking seriously.

Everyone’s situation is unique. – Garth

#23 KLNR on 09.03.18 at 7:31 pm

@#7 Chico on 09.03.18 at 5:56 pm

Jesus Chico, relax.
Can’t handle the truth eh.

#24 IHCTD9 on 09.03.18 at 7:32 pm

#10 crowdedelevatorfartz on 09.03.18 at 6:02 pm
@#197 IHCTD9
“Wow, RBC report says half a million. Why such a massive discrepancy?”
+++++

Gee the CBC filing another Trudeau “news” report that tries to minimize the debacle of failed NAFTA talks?

Say it aint so.
——-

Yep, I can’t wait for CBC to be defunded. It’s 100 miles from anything resembling balanced objective news. It’s another of the seemingly endless reasons to reduce my tax remittances. Some of the tripe that passes as news over there is unbelievable, and there is always some sanctimonious undertone in delivery that is telling you how you should be thinking on the topic. It’s like every article is an opinion piece.

#25 NoName on 09.03.18 at 7:33 pm

@farts and ihctd9

I do have skin in tha game when it comes to automotive industry, but you aleady know that, since my buddy slod me down the river, but i forgived him.

I looked a bit around added some numbers for just 4 assembly plants, ( didnt add gm in Oshawa they close ing it down anyway) adds up to around 28000 jobas (2 Toyota, 1 honda 1 ford) no casting or stamping plants in those number, just assembly. On a side note 2 in top 10 cars sold in us are made in canada.

For every assembly job depend what you read ther is low of 6 and hi of 9 spinoff jobs, how many are in canada but i can see how quickly numbers coonservativly guestimating go easy two and maybe 3 times higher than reported by government tv station. It would be interesting to someone smarter than i makes table and shows how oll that afect economy and what sectors im it.

If they put lock on a door mark ans his sales mix will look educational and entertaining comparing to my posts…

#26 BlorgDorg on 09.03.18 at 7:40 pm

And finally the labour day weekend has come and gone. Time for the traditional fall real estate season to bounce back into high gear as buyers and sellers jump back into the market…

… except this year it ain’t gonna happen. Act II of this market is about to begin. Get yer popcorn.

#27 IHCTD9 on 09.03.18 at 8:18 pm

#25 NoName on 09.03.18 at 7:33 pm
@farts and ihctd9

I do have skin in tha game when it comes to automotive industry, but you aleady know that, since my buddy slod me down the river, but i forgived him.

I looked a bit around added some numbers for just 4 assembly plants, ( didnt add gm in Oshawa they close ing it down anyway) adds up to around 28000 jobas (2 Toyota, 1 honda 1 ford) no casting or stamping plants in those number, just assembly. On a side note 2 in top 10 cars sold in us are made in canada.

For every assembly job depend what you read ther is low of 6 and hi of 9 spinoff jobs, how many are in canada but i can see how quickly numbers coonservativly guestimating go easy two and maybe 3 times higher than reported by government tv station. It would be interesting to someone smarter than i makes table and shows how oll that afect economy and what sectors im it.

If they put lock on a door mark ans his sales mix will look educational and entertaining comparing to my posts…
—————-

Yeah, I think that 91K number is low, big time low. Diaz says the vast majority of cars made in Canada ship to the US. I’ve got a B.I.L. that works at Honda in Alliston, they tell the employees “they’re working on a plan” if tariffs come to town – but nothing more. Meanwhile, I have a customer that works in autoplants outfitting robot cells, and he says game over if tariffs come. He already spends most of his time in Alabama and Mexico – that’s where all the new investment has gone.

To me, the fact that they’ve already been exiting stage left for a couple decades is really all I need to know. Things are bad enough right now to leave – making things 2X worse with tariffs will just speed up the existing processes.

I’ve got indirect skin in the game, I’ll have to compete with all those shops who used to do auto work that would be barging onto my turf in panic mode. Those auto guys tend to get totally usurped by the industry and end up doing almost nothing else other than automotive work.

#28 SoggyShorts on 09.03.18 at 8:25 pm

#6 Leo Trollstoy on 09.03.18 at 5:52 pm

Tried FIRE. Didn’t like it
Like Gartho said, if you like your work, why retire?
People who try to convince me otherwise are poor and definitely haven’t retired
Sucks to be them

#MAGA!
**************************
Exactly! Anyone who wants Financial independence must be a moron!
Obviously working your whole life should be the goal!
Too bad slavery is against the law, or else I could go volunteer for that!

Idiot.

#29 arfmoocat on 09.03.18 at 8:38 pm

Median annual income in 1976 was 54K

Median annual income in 2018 is 49K

#30 Chico on 09.03.18 at 8:45 pm

#23 KLNR on 09.03.18 at 7:31 pm

@#7 Chico on 09.03.18 at 5:56 pm

Jesus Chico, relax.
Can’t handle the truth eh.

————————————————————

You’re right. Making it mandatory for Canadians to vote is a brilliant piece of truth that you are presenting to the readers of this blog post. I sincerely apologize for upsetting you and hurting your feelings.

#31 crowdedelevatorfartz on 09.03.18 at 8:57 pm

@#24 IHCTD9
“and there is always some sanctimonious undertone in delivery that is telling you how you should be thinking on the topic. It’s like every article is an opinion piece.”
+++++

Total agreement.
I wince in pain when they bring on some “expert” to voice their opinion on some news event.
Last week on two consecutive evenings it was some associate professor from Nowhere’s-ville in the US commenting on Senator McCain’s life.
It almost immediately turned into 12 minutes of Trump bashing…..it was so pathetically biased it was ridiculous.
12 MINUTES of this gal droning on and on and on ….I changed channels after 4 minutes and would pop back every 4 minutes…..unbelievable.
On two consecutive nights! The same gal….Trump bashing……
CBC doesnt like Trump…….We get it

The CBC has no money to get real interviews.
Talk for 3-5 minutes and then move on!
Christ!
This is typical now for CBC 6pm “News”.
Get one major story and find the liberal, equality, environmental spin and….. beat…. it…. to…. death.

Sad.
Peter Mansbridge must be glad he’s left the pc $h!tShow.
In these politically correct times I wondered how the overpaid sloths and slugs in Toronto Head Office HR Dept would pick a gender neutral, inoffensive, anchor.

The solution for Mansbridge’s replacement on The National?

THREE anchors!
A woman, a man of indocanadian roots and a man of asian background.
Hurray! Problem solved!
Back pats all around at HR for making a nondecision decision!
CBC is sooooo politically correct its pathetically nauseating in its agenda.

Close the doors……. give them all the pensions they so obviously want …….and 25 years from now…….save $ billions.
Show us reruns of Front Page Challenge and the Beachcombers for the next 50 years.
It would be better than whats posing as “entertainment” today.

#32 fancy_pants on 09.03.18 at 9:27 pm

Argentina greets hyperinflation. Mark my words, as I have been warning for years, we are not immune. Enjoy your low rates while you can
https://www.cbc.ca/news/business/argentina-central-bank-interest-rates-1.4805032

#33 dakkie on 09.03.18 at 9:34 pm

U.S. Luxury Real Estate CUT Price by $1 Billion! Is This A WARNING Sign?

http://www.investmentwatchblog.com/u-s-luxury-real-estate-cut-price-by-1-billion-is-this-a-warning-sign/

#34 Remembrancer on 09.03.18 at 10:26 pm

#25 NoName on 09.03.18 at 7:33 pm

FCA Brampton not make the cut? About 3500 there as well to add to the toll…

#35 NoName on 09.03.18 at 10:38 pm

My bad fca is in there both plants, fca 9500, ford 5000, honda 4600, toyota 9000.

#36 Ponzius Pilatus on 09.03.18 at 10:54 pm

#29 arfmoocat on 09.03.18 at 8:38 pm
Median annual income in 1976 was 54K

Median annual income in 2018 is 49K
—————–
You are bang on.
As Garth pointed out a few posts ago, immigrats average about 35k.
Ergo, more immigrants lead to lower standard of living for everyone.
Now, go ahead and call me a racist.

#37 Ace Goodheart on 09.03.18 at 10:57 pm

#3 Tom from Mississauga:

When Brian Mulroney signed us up for NAFTA and Chretien just let it slip past I never, ever thought I’d see the day when Canada would have the opportunity to reverse that error and get out again.

The day has come and it is here.

And we have a feminist PM who is going to ditch NAFTA because it doesn’t deal with women’s issues.

Man the way things work out. 28 years watching my country get smashed up by the US wrecking ball and what saves us?

Women’s rights and a feminist.

We’re like litmus. We just can’t fake it. Throw us in anything, we’ll float.

Unbelievable.

Down with NAFTA. After 28 years I want my country back.

#38 bubu on 09.03.18 at 11:27 pm

#32 fancy_pants . that inflation would be very nice for Canadians.. I leaved in a country where the same thing happened and I paid my mortgage in 2 years instead of 25.. just get a fixed rate and you will pay everything from one monthly salary as I did 25 years ago…

#39 Chaddywack on 09.03.18 at 11:41 pm

@#4

They’re going for a bidding war or a foreign investor (notice the 8’s in the price).

That house is well below market value. It’ll sell for $1.2 even in this market.

#40 Rob on 09.04.18 at 12:40 am

#8 Bytor the Snow Dog on 09.03.18 at 5:57 pm

Not sure what you mean by ‘thanks Feminism’.

Having a single kid at age 40 was by choice after living in Europe for ten years, child free, and having a pretty fantastic time and travelling the world over several times. Though the kid was also sort of an accident. Too many beers and five months in a tent Down Under.

#41 Ustabe on 09.04.18 at 1:23 am

Hey, @ crowdedelevatorfartz & IHCTD9

The CBC goes where the Bell’s, Roger’s, Shaw’s and etc will not.
I worked up north after high school…zero TV except CBC. Ditto for radio.

There is a real reason that Rogers allows CBC to air Hockey Night in Canada…the CBC over the air signal gets into far more homes than the cable.

Eliminating the CBC or de-funding it would hurt far more Canadian citizens than it would please. But I understand that sort of thing doesn’t bother today’s modern conservative much.

I think there is a real need to push the CBC towards a PBS/NPR type funding scenario with only core funding provided via government. See if the people will support it when it involves digging into their own pockets for programming. That scenario would see the CBC forced to produce and air programming that appeals to a broad range of Canadians.

Bring solutions…don’t just bitch and moan about your problems…makes me wonder if you need some therapy for anxiety or something.

#42 Where's The Money Greedo? on 09.04.18 at 2:20 am

https://www.royallepage.ca/en/property/british-columbia/maple-ridge/21948-acadia-street/7602405/mlsr2258275/?ref=1
I mentioned this property some months ago and now find it today at $729k from the original price of $899k. 1280 SF RANCHER, ~$570/ sq.ft.
So a drop of ~20% since spring.
So hopefully it’ll drop another 20% by the end of the year and all other properties follow.
Still too pricey for me though and it’s still a POS on the outside, imo.
I sent Garth pics some time ago showing how run down it is. I see he’s showing the garage though lol.
HHCE……

#43 AuchSchonEgal on 09.04.18 at 2:27 am

Garth, as much as I love your blog, I find the idea that somebody should take out a loan to invest in the stock market unorthodox to say the least. I mean we laugh at people who extrapolate past real estate gains into the future, but find me any serious economist who does not think that the stock market is due for a very tough decade. Just think of 1990s Japan: a somewhat healthy economoy with asset prices hyperinflated by persistent low interest rates. Then, with little warning both real estate and stocks imploded catastrpohically – even despite the fact that interest rates remained low. And BTW, both NEVER really recovered.

Where did I say to invest only in the stock market? – Garth

#44 Tom from Mississauga on 09.04.18 at 3:19 am

Hopefully Trudeau quits today. Has he realized he fell for history’s largest ever ‘bait and switch’? Not exactly leadership material.

#45 Howard on 09.04.18 at 6:05 am

#176 Lee on 09.03.18 at 12:02 pm

#130 Howard,

What polls show Trudeau at 60 seats in Quebec?

———————————————

Please see the CBC’s poll tracker. It’s updated once a new poll comes out. I know we all hate the CBC but its seat projections seem valid given the polling data. As of now the Liberals win a razor-thin majority of 173 seats via a Quebec sweep. 1980 all over again.

https://www.cbc.ca/news/politics/poll-tracker-federal-poll-averages-and-seat-projections-1.4171977

#46 MF on 09.04.18 at 7:03 am

#36 Ponzius Pilatus on 09.03.18 at 10:54 pm

-What about business owners who enjoy a larger potential customer base? I know in my line of work, we get a whole lot of customers who are clearly immigrants, either recent or who have been here a while.

I thought this blog was all about business owners and the free market? Now we have this poster assuming every Canadian is a poor employee who needs assistance from the government to survive.

“Now, go ahead and call me a racist”

-I know you are being facetious, trying to pretend that every criticism of your criticism of immigration can be discarded as a knee jerk response from some leftist…but at my line of work we see many immigrants from the USA. A lot of them are skilled workers. We get a lot of aerospace engineers, as an example. Your incorrect assertion that every immigrant or work visa is from some far off land and who has zero skills shows how out of touch you are.

MF

#47 Gravy Train on 09.04.18 at 7:11 am

#36 Ponzius Pilatus on 09.03.18 at 10:54 pm
“[…] As Garth pointed out a few posts ago, immigrants average about 35k. Ergo, more immigrants lead to lower standard of living for everyone. Now, go ahead and call me a racist.”

You should be delighted with immigration if you own stock or low-cost index funds! AOTBE, lower wages and higher productivity imply higher profits, larger dividends, and higher stock prices! Now, if you don’t own stock or low-cost index funds, why are you reading this blog?

Oh—and BTW—you’re a xenophobe, not necessarily a racist! :)

#48 dharma bum on 09.04.18 at 7:46 am

“Everyone is so well trained now.” ~ Garth
——————————————————————–

So, when do we get our doggie biscuit rewards?

https://www.google.ca/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&ved=2ahUKEwiG9caTo6HdAhVG8IMKHZ-bCZ8QjRx6BAgBEAU&url=https%3A%2F%2Fwww.dreamstime.com%2Fbone-shaped-dog-biscuit-good-dog-words-imprinted-good-dog-reward-biscuit-image101315952&psig=AOvVaw1G2OQTCJJjaXBW8bwAEhUI&ust=1536147865265174

#49 Ponzius Pilatus on 09.04.18 at 7:54 am

#19 Nonplused on 09.03.18 at 6:53 pm
What’s with all the people writing in lately that don’t really have any financial problems? It’s not nearly as much fun as the bozos. Maybe all these years of effort and Garth has actually managed to educate an entire nation?
————
More likely, result of over-moderation by the host.
But hey, it’s his blog.

#50 FOUR FINGERS WATSON on 09.04.18 at 8:10 am

#45 Howard on 09.04.18 at 6:05 am
#176 Lee on 09.03.18 at 12:02 pm

#130 Howard,

What polls show Trudeau at 60 seats in Quebec?

———————————————

Please see the CBC’s poll tracker. It’s updated once a new poll comes out. I know we all hate the CBC but its seat projections seem valid given the polling data. As of now the Liberals win a razor-thin majority of 173 seats via a Quebec sweep. 1980 all over again.

https://www.cbc.ca/news/politics/poll-tracker-federal-poll-averages-and-seat-projections-1.4171977
…………………………………………

Wowzers. Another 39% majority for our fake democracy! More gay parades! Where’s my whisky and ceegars ?! Let the good times roll !

#51 crowdedelevatorfartz on 09.04.18 at 8:23 am

@#41 Ustabe CBC employee ( hey! That rhymes!)

“I think there is a real need to push the CBC towards a PBS/NPR type funding scenario with only core funding provided via government. See if the people will support it when it involves digging into their own pockets for programming. That scenario would see the CBC forced to produce and air programming that appeals to a broad range of Canadians.”
+++++

Total agreement.
I enjoy PBS.
Good luck dragging the “so far to the left it is embarrassing” CBC back to the popular limelight.

Have a visible minority owner with a physically impaired lost dog? Call the CBC. It should be good for a 15 minute interview at 6pm.

The CBC has become a mockery of its former self. Appealing to no one.
Yes I agree they reach far more Canadians than Rogers.
All the more reason they should be delivering honest, unbiased, PBS-like programming.
You know. Something to be respected.
The constant pandering to the far left is vomit inducing and pathetic.
An endless parade of screeching, anti establishment, politically correct diatribe by the staff and guests being interviewed drives viewers away.
And if CBC’s tanking viewership is any indication……I’m not the only one who feels this way.

The CBC. a sad shell of it former self….. bleating the “progressive, politically correct, good fight” ….into eventual irrelevance and ….eventually…its own demise.

Losing ratings, losing billions $ eventually even the most loyal taxpayer will say “enough”.

Keep CBC radio, take the rest out behind the barn and put it out of its misery.

#52 Howard on 09.04.18 at 8:31 am

#8 Bytor the Snow Dog on 09.03.18 at 5:57 pm

48 years old? With a young child?

What is this world coming to? Thanks Feminism.

—————————————–

That’s nothing.

Here : https://www.bbc.com/news/world-europe-38990529

Spanish 64-year-old gives birth to healthy twins in Burgos

#53 Howard on 09.04.18 at 8:46 am

#47 Gravy Train on 09.04.18 at 7:11 am

#36 Ponzius Pilatus on 09.03.18 at 10:54 pm
“[…] As Garth pointed out a few posts ago, immigrants average about 35k. Ergo, more immigrants lead to lower standard of living for everyone. Now, go ahead and call me a racist.”

You should be delighted with immigration if you own stock or low-cost index funds! AOTBE, lower wages and higher productivity imply higher profits, larger dividends, and higher stock prices! Now, if you don’t own stock or low-cost index funds, why are you reading this blog?

Oh—and BTW—you’re a xenophobe, not necessarily a racist! :)

—————————————

By that definition, unless you support open borders and a declaration of Canada as a global entity belonging to no one, you’re a xenophobe too.

Nobody I have heard advocates for open borders. But many want them closed. Not hard to spot the extremists in this debate. – Garth

#54 Howard on 09.04.18 at 8:50 am

#50 FOUR FINGERS WATSON on 09.04.18 at 8:10 am

#45 Howard on 09.04.18 at 6:05 am
#176 Lee on 09.03.18 at 12:02 pm

#130 Howard,

What polls show Trudeau at 60 seats in Quebec?

———————————————

Please see the CBC’s poll tracker. It’s updated once a new poll comes out. I know we all hate the CBC but its seat projections seem valid given the polling data. As of now the Liberals win a razor-thin majority of 173 seats via a Quebec sweep. 1980 all over again.

https://www.cbc.ca/news/politics/poll-tracker-federal-poll-averages-and-seat-projections-1.4171977
…………………………………………

Wowzers. Another 39% majority for our fake democracy! More gay parades! Where’s my whisky and ceegars ?! Let the good times roll !

—————————————-

Your comment is an example of where conservatives mess up. I don’t care about “gay parades”, and neither should any conservative. Let people march and wave flags and dance, who cares. I simply don’t want to have to pay for any of it. That’s the conservative message – do what you want, but don’t make taxpayers fund it.

#55 Stan Brooks on 09.04.18 at 9:01 am

Down it goes, flush the toilet after it:

Canadian dollar falls after Trump says no political necessity to keep Canada in new trade deal

https://ca.finance.yahoo.com/news/canadian-dollar-falls-trump-says-113000080.html

Keep in mind: NAFTA ‘uncertainty’ will be used by BoC as an excuse NOT to further increase rates.

Stock on lubricants/Vaseline, as I said as it will hurt.
BTW official ‘inflation’ will be sub 2 % going forward.

#56 Andrewt on 09.04.18 at 9:23 am

Interesting study from the (disclaimer: left leaning) Brookings think tank, regarding how entitlements have changed focus in an era of rising inequality. Wonkish.

https://www.brookings.edu/research/the-rise-of-the-middle-class-safety-net/

#57 AfterTheHouseSold on 09.04.18 at 9:30 am

#34 Remembrancer
“FCA Brampton not make the cut? About 3500 there as well to add to the toll … ”

FCA has lost a champion of Canadian production with the sudden passing of Sergio Marchionne this past July. The Brampton plant is also vulnerable due to the escalating land value and possible redevelopment of the site for housing.
NAFTA or no NAFTA, say goodbye to FCA in Brampton.

#58 Smoking Man on 09.04.18 at 9:58 am

Garth’s advice for not owning individual stocks has some merit.

You have no way of knowing when a CEO loses his mind.

Nike down 3%. Just short it…..

#59 IHCTD9 on 09.04.18 at 10:57 am

#41 Ustabe on 09.04.18 at 1:23 am
Hey, @ crowdedelevatorfartz & IHCTD9

The CBC goes where the Bell’s, Roger’s, Shaw’s and etc will not.
I worked up north after high school…zero TV except CBC. Ditto for radio.

…Bring solutions…don’t just bitch and moan about your problems…makes me wonder if you need some therapy for anxiety or something.
______

No shit. I was BORN and RAISED in one of those Northern towns. 3 channels and one was French. TV up there wasn’t worth my time back then, I was out riding my bike, or playing hockey instead. I can’t imagine how useless it is now.

I already brought a solution – can the funding for CBC 100% – it’s an echo chamber for 1-2% of Canadians at this point. Waste of money – Trudeau can put the savings towards his massive deficits.

You act like life would end if these Northern folks lost their pathetic TV services. I canned CABLE in my house VOLUNTARILY. No one misses it. I say get rid of the CBC and put the same dollars towards getting decent high speed internet up there – that’s all they need, and it’s way more useful than 3 channels worth of television.

Sharpen up your assertions – NO ONE is going to give a rip is CBC TV/Radio/whatever changes/dies. Nobody.

#60 yijin on 09.04.18 at 11:14 am

Good post!! thank

#61 Blacksheep on 09.04.18 at 11:17 am

Adrian # 4,

https://www.zolo.ca/vancouver-real-estate/7818-main-street

I know someone will correct me if I’m wrong, but does this listing not represent, a half of, a duplex home?

Two electrical / gas meters / cable boxes, clearly visible in the opening home pic. Two rear symmetrical front / rear patios, looking top down, from google earth. Neighbors to the right going multiple house down are a duplexes, some newer, indicating hood zoning.

And then there is this straight from the Zolo page:

“Why would you buy a townhouse when you can own a duplex with land???”

#62 KLNR on 09.04.18 at 11:17 am

@#30 Chico on 09.03.18 at 8:45 pm

LOL, you’re really stuck on this
settle down son. there was more to the debate than that.
sigh.

#63 KLNR on 09.04.18 at 11:23 am

@#59 IHCTD9 on 09.04.18 at 10:57 am
Sharpen up your assertions – NO ONE is going to give a rip is CBC TV/Radio/whatever changes/dies. Nobody.
___________________________

We know you, stan brooks and the rest of the belligerent curmudgeons won’t give a rip :)

#64 Canadian economy on 09.04.18 at 11:32 am

need a job?…weed to the rescue

https://lfpress.com/news/local-news/booming-marijuana-companies-struggling-to-find-skilled-workers

canopy growth $65.74 up over 9%

thank you Bruce Linton…:)

where r the blokes that said this was going to end badly?

#65 Oft deleted much maligned stock.picker on 09.04.18 at 12:21 pm

China is puking up blood….market collapse, export collapse, manufacturing collapse, scam explosion….hahahahaha….funny as hell given they master of the universe five minutes ago. Think Trudeau can stand up to Trump when China couldn’t?

https://www.washingtonpost.com/world/asia_pacific/chinese-anger-grows-as-get-rich-quick-investment-schemes-go-bust/2018/08/29/4a1cd5a2-a45b-11e8-b76b-d513a40042f6_story.html?utm_term=.6dcad6030090

Trudeau and his idiot trust has been on a reverse Turner Diaries Easter Egg hint trying to start a race war that would crater western Civilization. Obama is going on tour within weeks…..Trudummy has foot dragged NAFTA to demean Trump. Ask China how weak Trump is. I think Trump has a bucket of tar and a pillow case full of feathers for our little Trudy.

#66 NoName on 09.04.18 at 12:53 pm

41 Ustabe on 09.04.18 at 1:23 am
Hey, @ crowdedelevatorfartz & IHCTD9

The CBC goes where the Bell’s, Roger’s, Shaw’s and etc will not.

—-

You wrong.

https://www.kvh.com/Pages/Satellite-Coverage-Maps/Satellite-Coverage-Maps/TracVision-Maps/North-America/Bell-TV-Canada-Marine.aspx

#67 David Paquette on 09.04.18 at 1:02 pm

I saw this comment – “you can identify the pioneer by the arrows in his back”. I don’t want those but stupidly I rise up – it could be emotion over logic. I survive, learn and move on but, man, it can hurt.

This year has been rough for me investment wise. I have to eat so much crow that I am sick of it. But I will not give up. A few things are going well like my tomato(e)s and hopefully the pomme de terres. It is such a short growing season here and then I have to dodge hail. If nothing else, I will have a lot of green to fry.

I finally fixed my furnace. It was full of water because the condensate trap was plugged. I was so close to the problem. The repair man (sale a-hole) tried to sell me a new one and screwed me over on the bill yet did not fix the problem- he must thought as an idiot. I realize he has to eat too so I forgave.

I sucked and blew to get the water out of the system and cleaned the trap yet I don’t know if my effort will work till winter arrives. So far, so good. The price of new furnace is ghastly. Funny how they all cost the same from different suppliers and their reps are plumbers.

#68 NoName on 09.04.18 at 1:19 pm

#65 Oft deleted much maligned stock.picker on 09.04.18 at 12:21 pm
China is puking up blood….market collapse, export collapse, manufacturing collapse, scam explosion….hahahahaha….funny as hell given they master of the universe five minutes ago. Think Trudeau can stand up to Trump when China couldn’t?

https://www.washingtonpost.com/world/asia_pacific/chinese-anger-grows-as-get-rich-quick-investment-schemes-go-bust/2018/08/29/4a1cd5a2-a45b-11e8-b76b-d513a40042f6_story.html?utm_term=.6dcad6030090

Trudeau and his idiot trust has been on a reverse Turner Diaries Easter Egg hint trying to start a race war that would crater western Civilization. Obama is going on tour within weeks…..Trudummy has foot dragged NAFTA to demean Trump. Ask China how weak Trump is. I think Trump has a bucket of tar and a pillow case full of feathers for our little Trudy.

—-
That country spends more money on domestic policing and civil unrest that on a military.

https://www.google.ca/amp/s/www.wsj.com/amp/articles/china-spends-more-on-domestic-security-as-xis-powers-grow-1520358522

And, this 26 page report with chat and tabe to, that you don’t get to sea on teevee.

https://www.researchgate.net/publication/319403729/

#69 NoName on 09.04.18 at 1:22 pm

Addendum to privious post, if lazy to read scroll down to last page and youll find that according to someone there was 180 000 protests in 2010 alone. Thik about that for a moment, how fragile is that society.

#70 SimplyPut7 on 09.04.18 at 1:28 pm

#58 Smoking Man on 09.04.18 at 9:58 am

I hope it goes down 10%

Kaepernick didn’t vote in the 2016 election, he had no problem standing when Obama was president, when just as many black men were killed by police officers, and he like many SJWs or black lives matter members never talk about the black on black violence that hurts the black community more than racist police officers like in cities such as Chicago.

Black nfl players had no problems standing during Jim Crow era, black church burnings by the Klan, lynchings of black men by mobs of white people, assassinations of civil right leaders or unfair court rulings that sentenced black men to prison longer than white men and sent innocent black men to jail for crimes they didn’t commit because their complexion match the suspect police were looking for. Players who have been through worse still stand during decades of oppression because they love their country even with all of its flaws.

Yet some how, the world is supposed to fall behind this guy as if he has done something spectacular.

I’m tired of the SJWs looking to blame Trump for situations he never created and were tolerated long before he became president.

#71 IHCTD9 on 09.04.18 at 1:49 pm

#63 KLNR on 09.04.18 at 11:23 am
@#59 IHCTD9 on 09.04.18 at 10:57 am

Sharpen up your assertions – NO ONE is going to give a rip is CBC TV/Radio/whatever changes/dies. Nobody.
___________________________
We know you, stan brooks and the rest of the belligerent curmudgeons won’t give a rip :)
________

You’re damn bloody right about that :).

If you could run the entire CBC organization for 100 million, I’d shut my pie hole. But, it costs over a Billion to keep this useless organization afloat. The whole idea of a public broadcaster is long obsolete.

Let’s step into the 21st century and let them stand on their own two feet. If they’re any good – no one will lose their job.

#72 Stan Brooks on 09.04.18 at 1:49 pm

#63 KLNR on 09.04.18 at 11:23 am
@#59 IHCTD9 on 09.04.18 at 10:57 am
Sharpen up your assertions – NO ONE is going to give a rip is CBC TV/Radio/whatever changes/dies. Nobody.
___________________________

We know you, stan brooks and the rest of the belligerent curmudgeons won’t give a rip :)

Coming from your mouth I consider this as a huge praise. I thought of myself as young and sexy, but hey, everyone needs a reality check here and there.

At least I am not trying to ignore reality, can’t afford it.

As for your behind, rest assured, it won’t be me trying to surprise you.

#73 Zapstrap on 09.04.18 at 1:55 pm

#67 David Paquette on 09.04.18 at 1:02 pm
I finally fixed my furnace. It was full of water because the condensate trap was plugged. I was so close to the problem. The repair man (sale a-hole) tried to sell me a new one and screwed me over on the bill yet did not fix the problem- he must thought as an idiot. I realize he has to eat too so I forgave.

Try replacing one yourself … not much to it, but out here in LaLa Land no one will sell you one. They say it is too dangerous for you to install yourself but will sell you a gas water heater to install … that’s OK.

I sucked and blew to get the water out of the system and cleaned the trap yet I don’t know if my effort will work till winter arrives. So far, so good. The price of new furnace is ghastly. Funny how they all cost the same from different suppliers and their reps are plumbers.

#74 Ponnaps on 09.04.18 at 2:02 pm

Isnt the interest deductible only from the income that’s generated from the borrowing, and not from your overall income?

#75 Jimers on 09.04.18 at 3:05 pm

Dump the CBC and The Monarchy!

#76 Bdwy sktn on 09.04.18 at 3:22 pm

4 Canadian economy on 09.04.18 at 11:32 am

where r the blokes that said this was going to end badly
…………
Think bitcoin at 20k badly.

Obvious stupid mania now.
Max 1b domestic sales. 15b valuation now.
See 90% drop once reality hits.
Puts will go 10x all over the place.
Wait till 1st week of Oct.
Get ready.

#77 Blacksheep on 09.04.18 at 3:46 pm

Crowded # 11,

“Wait until ALL the listings are $750k……… moo hooo haa haaa haaaaaaaaaaaaa”
—————————–
You seem to suffering from, premature ejubilation.

$ 750K buys you 50 % of a non renovated, “non-conforming duplex” with an unfinished basement, in a hood full of duplexes, on a four lane road.

Sounds like a real deal.

You my get your wish someday but today, is not your day…..

#78 Ubul on 09.04.18 at 4:13 pm

#76 Bdwy sktn on 09.04.18 at 3:22 pm

Think bitcoin at 20k badly.

+

Bitcoin didn’t crash much more differently from the stock market, it is climbing slowly, currently hovering around $10K. Most importantly, to achieve this, it did not need any government backstopping, bailout, QE and artificially forcing interest rates extremely low, all over the world, for a whole decade. The medicine to get the stock markets recovered created real estate and other debt bubbles and huge wealth inequality gap. We still don’t know the full extent and all the consequences of all the side-effects of the crisis treatment.

>during the 2008-10 financial crisis…stock markets cratered 55% and took seven years to recover<

#79 Remembrancer on 09.04.18 at 4:18 pm

#74 Ponnaps on 09.04.18 at 2:02 pm

Isnt the interest deductible only from the income that’s generated from the borrowing, and not from your overall income?
————————————————————–
Just like investment income goes into the income pot, interest paid on investment borrowing goes into deductible expense pot…

e.g. you have a rental property; mortgage interest claimed as expense, mortgage principal not claimable, rent collected is income…

#80 oopswediditagain on 09.04.18 at 4:50 pm

Blacksheep: “You seem to suffering from, premature ejubilation.”

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

… and this is why I miss you so much as a "bear", Blacksheep.

Crowdie is a little closer to the truth but your right. The pleasure will certainly last longer with a little patience … for some.

#81 crossbordershopper on 09.04.18 at 5:02 pm

all i see is that in the us you can deduct your mortgage interest without fancy dancing.
income of 240 canadian dollars is no huge amount and 53% is like crazy tax
and of course us companies are far better run, more profitable, world class, us $ based, diversified, where you can get defense biotech big pharma big tech, and lots of other industries.
where in canada you get some banks insurance companies and some resource firms.
and 1000 near extinct resource names trading around .1o cents canadian.
about diversified dividend preferred etf stuff, man most of the us citizens pay zero tax on dividends , $77200 per couple, in us dollars, zero, its not complicated number, zero, here its about gross up, credits , bizarre , arguing over a dollar here and there.
man it rocks in trumpville.