Spendy people

A rate cut this year? Fuggedaboutit.

Canada created over 35,000 jobs last month. The unemployment rate fell. The 2019 job creation total – despite a few months of suckiness – was the second-best in 13 years, at more than 320,000. So the central bank took a gamble last year when the Fed was chopping (three times) and held fast. It was the right call.

What did bonds do today? Yup. The yield on 5-year GoC debt popped. Bond yields have risen 30% since September – the reason mortgage rates have been inching higher. Given the latest jobs stats, expect more. And did I mention no Bank of Canada cut?

By the way, we’re creating the right kind of jobs, as opposed to self-employed embroiderers, dog walkers and freelance lepidopterologists. Last month 38,400 people found real full-time work. The private sector created 57,000 positions while 21,500 civil servants went home.

All this sounds pretty good until you look at household finances. Debt continues to rise, along with the monthly cost of servicing it. This is why consumer spending in Canada has tanked with retail sales down yielding a poor Christmas for shopkeepers. Remember that two-thirds of the entire economy comes from spending, which is why jobs (good) and debt (bad) are critical.

Given the fragility of our situation, the last thing we need are more taxes. But here they come!

We’ve already alerted you to the plan Chateau Bill and his bearded buddy have to ‘modify’ the way capital gains and perhaps dividends are treated, as well as further tighten the screws on the self-employed with professional corps. But closer to home (if you live in the GTA or the LM) is the continuing assault on real estate.

Don’t be surprised. You were warned.

In Vancouver property taxes are taking a giant leap – up about 8% or four times the rate of inflation. Some of the tax burden is being transferred from businesses to residential owners. And as the market value of high-end detached houses is constantly eroded by the NDP’s venomous  assault, more of the property tax must be shouldered by those buying ‘affordable’ real estate – like $2 million Vancouver Specials or $700,000 weensy condos. That’s what happens when you elect spendy people.

In Toronto we’re just weeks away from the announcement of an ‘empty house’ tax in the nation’s largest market, as well as a jump in the ridiculous double land transfer tax on high-end digs. Oh yeah, and property tax is rising 8% over the next few years.

As you know the vacant house thing was pioneered in YVR when advocates screamed 25,000 places were empty. That was a lie. The number of homes not inhabited full-time turned out to be about 2,000. The city has extracted about $38 million from those owners and for 2020 has increased the tax by 25%. The low rental vacancy rate – the supposed reason this levy was put in place – has not dropped. So, it was just a tax to be a tax, aimed at Hovering off additional revenue from wealthy people. The Canadian way.

Toronto also spends more than it takes in, a significant amount of that to pay for the defined benefit pensions of employees, past and present. Then there’s transit. Subway extension and the cross-town line cost billions upon billions, and are grossly over budget. The city is desperate. The anti-tax, right-wing, former-Conservative-leader mayor is now a spend-and-tax liberal. So his metamorphosis is complete. And up goes the cost of living.

The trouble is, Toronto is Canada’s commercial, corporate and financial capital. There are thousands of homes and condo units used by people who need access to the city for business reasons and for whom hotels are impractical. When all these units were bought, they were taxed. During ownership, they are taxed. When sold, taxed again. Now a 1% vacancy tax on a $700,000 one-bedroom unit used the equivalent of four or five months a year will amount to seven grand – or twice the property tax owing. Coming next month.

The impact of this tax plus the new tough Airbnb regs (there are over 21,000 units for rent) and a creep in lending rates could be palpable. Will gutting the stress test mitigate that? Or has real estate become just too juicy a target for governments – who will encourage ownership and debt, only to feast then on the hapless owners?

Alas. Harry and Meghan may have no idea what awaits them.

103 comments ↓

#1 Brian Ripley on 01.10.20 at 3:32 pm

“Edmonton and the Peg are frozen.” Garth from yesterday

My Plunge-O-Meter is showing up the first housing casualty: Edmonton
http://www.chpc.biz/plunge-o-meter.html

Edmonton SF Detached Prices are now 1% below the first Plunge-O-Meter target (ie: 2013)

14% below that is the 2009 target.

#2 HoweStreet.com on 01.10.20 at 3:37 pm

Ross Kay on This Week in Money:

https://www.howestreet.com/2020/01/gold-oil-real-estate-resource-juniors-this-week-in-money/

#3 Leo on 01.10.20 at 3:40 pm

Other than CPP, defined benefit pensions are paid for by their members. Not tax payers.

Untrue. There is an employer portion and benefits can far exceed a worker’s contributions over time. – Garth

#4 Shawn Allen on 01.10.20 at 3:43 pm

Is this a suggestion that Toronto raise taxes?

“Toronto also spends more than it takes in, a significant amount of that to pay for the defined benefit pensions of employees, past and present.”

*************************************
Pensions were promises made and that will continue to be promises kept.

When it comes to pensions it would seem that the spending cannot be cut. Therefore, if people don’t like deficits; do they suggest tax increases?

Or can Toronto cut spending such as chopping back the number of active employees?

Or, can they grow the City budget sufficient to allow budget to balance itself? If so, they can keep borrowing until that happens?

#5 Shawn Allen on 01.10.20 at 3:45 pm

Be careful what you promise

It was around 1975 that Warren Buffett wrote a very lengthy letter to his friend Katherine Graham, owner of the Washington Post, warning in detail about the dangers of making pension promises. I believe he reprinted that letter in his annual report several years ago.

Toronto and governments in general did not get that memo.

#6 David Pylyp on 01.10.20 at 4:02 pm

In Toronto we’re just weeks away from the announcement of an ‘empty house’ tax in the nation’s largest market, as well as a jump in the ridiculous double land transfer tax on high-end digs. Oh yeah, and property tax is rising 8% over the next few years.

This will be painful and punitive

David Pylyp
Toronto

#7 Nat on 01.10.20 at 4:03 pm

DB pensions are good because the employees give up a very large contribution off their pay cheque. Employers match contributions 1:1 similar to any RRSP matching plan in the private sector.

#8 Xpat on 01.10.20 at 4:13 pm

#1 Brian Ripley on 01.10.20 at 3:32 pm
“Edmonton and the Peg are frozen.” Garth from yesterday

My Plunge-O-Meter is showing up the first housing casualty: Edmonton
http://www.chpc.biz/plunge-o-meter.html

Edmonton SF Detached Prices are now 1% below the first Plunge-O-Meter target (ie: 2013)

14% below that is the 2009 target.

—————-

Interesting charts. If you look at Vancouver SFD it really looks like the dead cat bounce is over and it’s going down slowly but surely. Mean reversion will have it settle down around 900k, but will probably overshoot.

Makes you wonder what the burbs will be priced at.

#9 Toronto CA on 01.10.20 at 4:18 pm

#3 Leo on 01.10.20 at 3:40 pm

Totally untrue. We, the taxpayers, are the ’employers’ funding these DB pensions.

#10 Bloomberg Jane & Finch on 01.10.20 at 4:19 pm

Toronto post-secondary graduates work for free as unpaid interns. This might be counted as “employment”. Millennials don’t know why they are working for free, but how will they get a job in this oversaturated job market?

#11 Sweden on 01.10.20 at 4:22 pm

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#12 SunShowers on 01.10.20 at 4:26 pm

“The private sector created 57,000 positions while 21,500 civil servants went home. All this sounds pretty good until you look at household finances. Debt continues to rise, along with the monthly cost of servicing it. This is why consumer spending in Canada has tanked with retail sales down yielding a poor Christmas for shopkeepers.”

Gee, sure sounds like the 57,000 full time positions created pay extremely poorly. Guess that’s what happens when manufacturing gets offshored and we become a service economy.

Can you not read? – Garth

#13 acdel on 01.10.20 at 4:26 pm

Dam, another great Canadian icon gone; RIP Neal Peart!

https://www.cbc.ca/news/entertainment/neil-peart-obit-1.5422806

#14 Shawn Allen on 01.10.20 at 4:30 pm

Who pays for Pensions?

#3 Leo on 01.10.20 at 3:40 pm
Other than CPP, defined benefit pensions are paid for by their members. Not tax payers.

Untrue. There is an employer portion and benefits can far exceed a worker’s contributions over time. – Garth

********************************
CPP is funded equally by employers and employees and zero by taxpayers. Zero! (except where the government is the employer).

Many government pensions are funded equally by employees and the government employer. But the federal one is something around two thirds contributed by the government I believe. It has not been 50 / 50 historically.

Of course, the benefits greatly exceed contributions. We’d fire the managers if that were not the case. Money flows into pensions plans from the profits of companies serving consumers.

One can argue that the taxpayer pays the government’s share of pensions. That’s true but in effect the taxpayers as a population needed to hire the government workers to provide needed services and governance. No employer including taxpayers should begrudge the wages and benefits they pay should they?

Did the government workers not earn their wages and benefits? If not, whose fault was that? I’d blame the employer / taxpayer not the government workers who simply took the deal offered.

#15 Linda on 01.10.20 at 4:40 pm

Is there such a thing a ‘tax-fixing’? Because I am noticing a theme here. Vancouver tax up 8%. Toronto up 8%. Calgary 7.8% & like Vancouver have shifted more of the tax burden from business to residential. I believe Edmonton also announced a tax increase in the 8% range for the 2020 year.

Another thing I’ve noticed is how pensions (especially having a public one) have become the latest public enemy number one. Shouldn’t we as a society work to ensure that everyone has a secured pension for retirement? One of the recurrent themes is that public pensions are taxpayer funded & therefore unfair to those who don’t have one. However the pension members contribute to the plan as well. Spare me the rhetoric about how they are paid out of the public purse. As for the holier than thou crowd, have you or your employer ever been the recipient of a government bailout or subsidy? Because I fail to understand how it is just fine to accept public money that way but totally wrong to contribute to a pension plan that isn’t optional.

#16 Camille on 01.10.20 at 4:40 pm

Canadian bond yields started the day up in green, in line with a good employment report. Then quickly turned red, recovered a little, and then promptly dived into the deep red today. Check out the ten and thirty. The five barely moved. So that’s that. US bonds were even deeper in the red. As far as 30% movements, yes that’s true. But when yields are so low, this does not have a very big effect, especially on the type of bonds most hold. Increased percentage volatility is a mathematical effect. Check out European bond yields.
What’s the point, correlating this to federal rates?

#17 AGuyInVancouver on 01.10.20 at 4:46 pm

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#18 Sweden on 01.10.20 at 5:00 pm

How much did the Illuminati globalists pay you to remove my comment?

What happened to free speech? Is Canada like Sweden where the native-born population is suppressed?

I got two hundred bucks. Why? – Garth

#19 leebow on 01.10.20 at 5:04 pm

Another Canadian couple on the path to FIRE
https://sussexroyal.com/funding/

#20 Occasional Reader on 01.10.20 at 5:08 pm

“The low rental vacancy rate – the supposed reason this levy was put in place – has not dropped. So, it was just a tax to be a tax, aimed at Hovering off additional revenue from wealthy people.”

Or the tax just wasn’t substantial enough to influence behaviour so far.

#21 Mattl on 01.10.20 at 5:15 pm

Rate cuts confirmed

#22 Dog Breath on 01.10.20 at 5:17 pm

“Alas. Harry and Meghan may have no idea what awaits them.”
———————————————–
I know what awaits them. Instead of feeding at the public trough in the U.K., they’re going to expect to feed at the public trough in Canada. We already have one Prima Donna prancing around on the taxpayer’s dime, we don’t need another one!!

#23 Lee on 01.10.20 at 5:23 pm

The big problem with government employee pensions (not CPP and OAS) is that almost no solution is good for government. Cutting benefits also means less tax revenue for government. Increasing employee contributions also means less tax revenue. Increasing the age where you can collect your pension means higher paid workers stay on longer as employees, thus increasing employer costs. The federal and provincial governments are extremely dependent on the incomes these pensioners earn as pensioners for tax revenue, as they are a guaranteed source of taxes. Don’t expect any radical changes to the way these pensions are funded. I think over time what we will see is smaller pay increases for government employees which will in the long run flow through to reduce pension payments. Until then, pension envy will get you nowhere.

#24 Linda on 01.10.20 at 5:26 pm

Revised property tax figures for Calgary – they reduced it to 7.51% but some new service fees were implemented so likely the overall tax hit is still about 8%. As for Edmonton, they have a reported $28 million revenue shortfall but were working to find a way to limit their 2020 tax increase to 2.8%. I checked on Ottawa, Montreal & Halifax; all apparently have managed to limit property tax increases to 3% or less for the 2020 year.

#25 Stone on 01.10.20 at 5:27 pm

#10 Bloomberg Jane & Finch on 01.10.20 at 4:19 pm
Toronto post-secondary graduates work for free as unpaid interns. This might be counted as “employment”. Millennials don’t know why they are working for free, but how will they get a job in this oversaturated job market?

———

Well, if they actually have skills that are in demand, there is no oversaturated market. If they’re delicate snowflakes with thin skins and nothing to offer to an employer, that market is definitely oversaturated. It’s not the employers job to hire wasted meatbags. The meatbags need to adapt or fall behind. And they should never, ever work for free. Period! Only fools do that. It’s all up to them.

#26 OK, Doomer? on 01.10.20 at 5:31 pm

#3 Leo on 01.10.20 at 3:40 pm
Other than CPP, defined benefit pensions are paid for by their members. Not tax payers.

Untrue. There is an employer portion and benefits can far exceed a worker’s contributions over time. – Garth
++++++++++++++++++++++++++++++++++++

And if you’re fortunate enough to have been self-employed your whole career, you will have paid twice (employer AND employee) portions not only for yourself and for anyone you’ve ever employed and only get to collect once.

Where the hell is Delaware anyway?

#27 jsto on 01.10.20 at 5:37 pm

Harry and Megan should not be part of this conversation… If the insanity of the real estate market continues and propped by governments at the expense of the “no good” renters… taxing those gains will be a priority…

#28 the Jaguar on 01.10.20 at 5:44 pm

“So the central bank took a gamble last year when the Fed was chopping (three times) and held fast. It was the right call.”

I hope they give Mr. Poloz a nice party when he leaves. He has been a class act. A ‘steady eddie’ type and I liked the fact that he wore nice cuff links. It’s those small things.
As for the GTA and all the other Godzilla-like hoods in the country who are getting too big for their britches, tax grabs aside I think the real ‘black swan’ event for real estate will be the building integrity of all these glass towers that have been built. John Lorinc wrote a great piece in the Globe a few months ago about the energy inefficiency and other failings of these glass boxes. And those towers have no hope of future renovation and don’t serve peoples desires to raise a family. They’re going to go ‘out of fashion’ abruptly. If the OK Boomers want to downsize it will be outside of Gotham City. Live better with less – a great idea whose time has come.

#29 crowdedelevatorfartz on 01.10.20 at 5:53 pm

“So, it was just a tax to be a tax, aimed at Hovering off additional revenue from wealthy people. The Canadian way.”
++++

So many crosswalks…so few rainbows….so little money.

That tax is desperately needed !

#30 crowdedelevatorfartz on 01.10.20 at 5:55 pm

@#22 Dog Breath

I’d rather see the two “ex Royals” on 6pm tv than Little Lord Fauntleroy …

#31 crowdedelevatorfartz on 01.10.20 at 6:01 pm

@#15 Linda
“Is there such a thing a ‘tax-fixing’? Because I am noticing a theme here. Vancouver tax up 8%. Toronto up 8%. Calgary 7.8% ”
++++

How much yew wanna bet that is approximately what they need to keep their retired municipal employees pension solvent….
Since most municipal employee pensions are short of cash…..

#32 Dutchy on 01.10.20 at 6:08 pm

Very nice Garth,
Wonder how many readers Googled “lepidopterologists”

#33 JFC13 on 01.10.20 at 6:21 pm

Correct me if I am wrong, but from what I understand these 35 K new jobs only exist because of the magic of “seasonnaly adjusting data”? Without adjustment, it is a lost of 7K…after a lost of 135 k last month!
https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410035501

#34 Dutchy on 01.10.20 at 6:21 pm

“Canada created over 35,000 jobs last month. The unemployment rate fell. The 2019 job creation total – despite a few months of suckiness – was the second-best in 13 years, at more than 320,000.”

What a difference (in perception) one month makes.

https://www.greaterfool.ca/2019/12/page/13/

#35 Jack on 01.10.20 at 6:23 pm

Regarding the dispute on the pensions, the key point that most people miss is “Defined Benefit”. If it was “defined contribution” then it really does not differ from RRSP or anything similar. The problem is the overly promised benefit that has to be covered by the employer (in most cases, the government – tax payer), regardless how the contribution is divided.

#36 AGuyInVancouver on 01.10.20 at 6:26 pm

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#37 The real Kip (Ret) on 01.10.20 at 6:42 pm

Wowzers! That’s a lot to take in. I’m just a poor pensioner living in my SFH, so how do all these new regulations affect me? That’s what I thought.

#38 DFO on 01.10.20 at 6:47 pm

I’m all for vacancy taxes because it encourages people to contribute to the local economy.

Cry me a river if your short-term business person rental in a private residence is subject to vacancy taxes. What use is a private residence that doesn’t house a person who contributes to the day-to-day economy?

This is the only current solution to get any money from the very wealthy who sit on many properties and have finagled various tax ‘avoidance’ strategies so that their property ownership, in fact, becomes a burden to the locals. If an empty property catches fire, houses vermin, or explodes from a gas leak, who pays for the city services?

#39 Nonplused on 01.10.20 at 6:48 pm

I have to admit I had to look up “lepidopterologists”. Sounds like it would be a profession in decline given the insect die off going on due to all those pesky pesticides.

Gail has another interesting article out:

https://ourfiniteworld.com/2020/01/08/expect-low-oil-prices-in-2020-tendency-toward-recession/#more-44631

If her assessment is correct there is still no good news on the horizon for Alberta.

Her forecast kind of contradicts the strong corporate profits we are seeing but it does fit in nicely with the high debt levels and sluggish consumer sales figures. Most people (not readers of this blog of course) are having trouble replacing that $1000 iPhone every 2 years. They simply aren’t making enough money to live the dream, and thus must borrow.

Of course much of it is based on people’s lifestyle expectations, but much of that is based on human psychology. We expect to have the same sort of lifestyle we observe the people around us to have. So if the neighbor’s kids all have iPhones and play hockey your kids have to too or the wife will see you as not worthy. If your wife’s best friend just got a brand new RV well guess what you are spending the weekend doing?

I always say “Never move to a rich part of town unless you are prepared to buy your wife a brand new BMW”.

Just last night I was talking to a waitress who had her 5 year old son in hockey. My son played hockey for a few years and so I can tell you from experience that business is expensive. You can easily drop $2,000 for a 4 month season. And that doesn’t include out-of-town tournaments. Add another $1,000+ for that. She must get really good tips. But if you don’t put your kid in hockey you are a bad parent. And then add to that the fact you need to get new skates every year and everything else every 2 years and yeesh. (One thing I never figured out is where all the used equipment stores went. You’d think there would be pretty solid demand, especially for kids equipment.)

Even soccer can zing you for a lot of $$$ these days. The trick the clubs use is to put your kid on a competitive team based on evaluations, but of course then you have to pay another $350 for technical sessions with paid coaches. And then if you make the provincials, well it’s off to Fort Mac for the weekend.

People simply can’t afford to pay for all this stuff without borrowing money. That’s why personal debt levels only go up, especially for families in the child rearing years who may not be at full income potential yet. But unfortunately the babies can only wait so long. I think this is why in the past it was common for women to marry men who were older than they were and making bank. But now people tend to marry their grade school cohorts and finance their children to be paid off at a alter date.

But yet among all this financial pressure governments figure there must be some additional dollars out there in the system just ripe to be taxed. It doesn’t work that way. Outside of the 1%, raising taxes just raises the amount borrowed against the house each year.

#40 crowdedelevatorfartz on 01.10.20 at 6:59 pm

@#7 Nat
“Employers match contributions 1:1 similar to any RRSP matching plan in the private sector….”
++++

My goodness.
The govt employee delusional lies are full on tonight.
Full Moon explains it.
In ALL my 44 years of working in private sector companies…they NEVER matched our pension contributions 1:1.
The best was employer contribution was 25% of my contribution and it was usually a Company share purchase. For every 3 shares I bought they would contribute 1.
Hardly a generous offer when the best you can hope for is the share may go up in value.

The retired, govt pigs feeding at the pension trough will soon hit a wall when the taxpayers start hanging their spineless political “leaders” at the polling booth.
Eventually pensions, benefits, etc will be hauled back in line with reality.
Take note at what is happening in France.
An unsustainable, unaffordable pension system is kicking the federal budget in the gonads…so the govt is cutting….one way or another….

:)

#41 I'm Alright Jack on 01.10.20 at 7:00 pm

Speaking of useless taxes, I’ll be paying my fair share of the carbon tax next week. It’s forecast to be going down to minus 35 to 38 at night with daytime highs in the mid minus 20s (central BC).

Both gas fireplaces will be going full time so we don’t have to listen to the gas furnace kicking in continuously. Plan to huddle inside with a good book and some whiskey.

But I’m sure glad I’ll be saving the planet from that nasty global warming – and paying the BC NDP more taxes at the same time (a win-win).

If the gas cuts out and the wife and I freeze to death, we’ll be saving the planet from even more deadly CO2. Another win for the planet.

#42 Cabbagetown Carly on 01.10.20 at 7:06 pm

“Toronto also spends more than it takes in, a significant amount of that to pay for the defined benefit pensions of employees, past and present.”

Sorry Mr Turner, this is simply not true. You sound like a ranting right wing fool making this comment with no factual basis. You’re not, of course. So what are you drinking today?

The OMERS pension plan is funded by employer and employee contributions. These have remained stable and reasonable for decades. The only problem the plan ever had was when the Harris government showed its hatred of unions and ordered contributions to stop for several years when markets were booming in the 1990s and such plans had a surplus, only to leave such DB plans underfunded when the dot-com bust happened.

Most have now recovered or are about to, based on equal contributions from employer and employee. Not much different in cash flow from an employer contribution RSP program.

This is not the problem with Toronto’s or any city’s budget. It may simply be property tax levels that are too low or other infrastructure or staff issues. It is not the pension plans.

#43 VicPaul on 01.10.20 at 7:16 pm

#3 Leo on 01.10.20 at 3:40 pm
Other than CPP, defined benefit pensions are paid for by their members. Not tax payers.

Untrue. There is an employer portion and benefits can far exceed a worker’s contributions over time. – Garth

*******

Admittedly, I’d prefer the DB (thank you 26 year teaching career) but, other than being indexed (and paying out until death), isn’t it much like employers matching employee’s contri’s – ours is not 50/50 but 52% employer/48% employee….except that I’ve been required to pay x% (roughly 12k/yr) to it, like it or not.

M55BC

You paid $12,000 per year into it (pre-tax), with the employer matching? How much annually do you draw? – Garth

#44 Conspiracy Theory on 01.10.20 at 7:17 pm

One of the most dazzling Soleimani conspiracy theories I have come across is that because he was on the terrorist list (Obama did that) the CIA took him out without consulting Trump until it was too late. The theory goes on to say that of course Trump had to take credit for it, because if he said he didn’t know about the attack until later people would say “whaaaat????” But regardless whether he approved a plan before or after it happened doesn’t matter, it shows the danger of these so-called lists. Once a person is on the terrorist list, the military-intelligence apparatus has authority to shoot at will. This wasn’t anywhere near the first time they did it, it’s happened 100’s of times under both Obama and Trump (Trump’s kill rate has actually ben lower than Obama’s), but it was the first time they took out a high-ranking government official from an actual country.

In response Iran’s parliament voted to put the whole US military on their “terrorist list”, which is largely symbolic because they have been doing their best to kill American soldiers for a long time.

Pelosi has introduced legislation to limit Trump’s ability to act against Iran, so it may in fact turn out to be a gift to the Ayatollah. But the authority to go to war properly lies with congress so it is probably the right thing to do. Bush had unlimited war making authority and so did Obama, but that wasn’t right based on the constitution. But it gives the Ayatollah some breathing room as now there can be no attacks on Iran until congress debates it, which he will be able to watch on CNN.

So here is where we are at in this whole sorted mess. Obama put Soleimani on the terrorist list. Trump either authorized executing what that meant or took credit for it later. Congress has prevented the president from self authorizing a war against Iran. Iran has now got breathing room as Trump and the US army has basically been limited to only attacking targets on the terrorist list and outside of Iran. Since Trump campaigned on ending the forever wars seems like everybody wins except for one really bad guy who was causing a lot of trouble. All Iran has to do now is make sure they don’t piss off congress. However, if they do I predict this blog will go back to being a forum for how best to catch and cook squirrel.

#45 Steven Rowlandson on 01.10.20 at 7:19 pm

“Or has real estate become just too juicy a target for governments – who will encourage ownership and debt, only to feast then on the hapless owners?”

Yes! You can’t hide real estate from the taxman. Besides it is all overpriced and un-affordable any way. Anyone who can pay for anything more than a tent or a car is filthy stinking rich! Just the sort that needs to make a donation to the government for the common good. Were it not for real estate being hyped as a win, win investment, homes would be cheap and any man jack with a job could buy one to live in and governments would not be so pressed to pay for homeless shelters and other housing related social programs set up for the sake of those priced out of the country. Real estate profiteers of all descriptions created the problem therefore they can help pay for it.
Canada was not meant to be England in the time of Charles Dickens nor is it supposed to be one of John Calhoun’s mouse utopia experiments.

#46 crowdedelevatorfartz on 01.10.20 at 7:25 pm

@#42 Carly Cabbagetown
“It may simply be property tax levels that are too low or other infrastructure or staff issues. It is not the pension plans.”
++++
Bwahahaha.
Transit thats billions over budget.
Property taxes through the roof.
City employee Pension plans that are draining the municipal budgets as boomers retire.

Economics 001
God I love a full moon.

#47 crowdedelevatorfartz on 01.10.20 at 7:30 pm

@#43 VicPaul
” (thank you 26 year teaching career)…retired at 55…
++++

Wow !
You slaved behind a desk for a whole 26 years…the horror.
The private sector is just hitting their stride at 26 years…
Did you book off on stress leave ?
Zero Empathy for govt workers whining about how hard they have it.
Especially when I deal with them on a daily basis.
Underworked, overpaid, entitled, lazy, sloths that are too stupid to realize how good they have it….
The day of reckoning is coming folks.
Count on it.

#48 Lead Paint on 01.10.20 at 7:31 pm

The major problem with public sector pensions is that unions threaten politicians with political strife to achieve financial commitments that take place after their elected term. This should be abolished.

#49 hookshott on 01.10.20 at 7:33 pm

As you know the vacant house thing was pioneered in YVR when advocates screamed 25,000 places were empty. That was a lie.
……………
Link please.

#50 Everything is better in USA! USA! on 01.10.20 at 7:34 pm

People in Canada are house poor. Eating cardboards. I can just by looking at their clothes and huge lines ups at stores like no frills and freshco. I pity the fools.

#51 Nonplused on 01.10.20 at 7:36 pm

#41 I’m Alright Jack

Don’t worry about the furnace kicking in and out, it’ll be running full time. I’d check which is more efficient the furnace or the fireplaces and run the more efficient unit first. My furnace is 95% efficient but my gas fireplace is only about 80%, so I save 15% in carbon taxes by using the furnace first.

Since you are in central BC, it seems it might be time for you to consider a carbon neutral wood stove or fireplace. Just chop down a bunch of trees every year (be conscientious and plant new ones), fire up the chain saw and log splitter, and haul all that around in your truck! Make sure you have outside air for combustion though or the furnace might actually run more. Oh and think 2 years ahead because the logs need to dry. See? Easy-peasy to avoid carbon taxes when it’s -38. Unless you have a day job of course.

#52 Everything is better in USA! USA! on 01.10.20 at 7:36 pm

If this was USA, people would have revolted. Canadian are timid.

#53 acdel on 01.10.20 at 7:48 pm

#32 Dutchy

No idea; I figured it was some sort of hemorrhoid condition; too lazy to look it up!!

Those Smoking Man bashers; I remember the abducted alien guy saying that the U.S. economy would explode under Trump; meaning new highs in the Dow; record low unemployment; meanwhile in Canada people are more concerned about a beard and two people a baby British folks moving here! No wonder this country never moves forward! Pathetic!!

#54 Deplorable Dude on 01.10.20 at 7:51 pm

Another stealth ‘tax’ in BC?….ICBC is now requiring that you register all potential drivers of your car. Your premium now potentially gets whacked depending on the driving record/age of these listed drivers.

And someone mentioned carbon tax….why the hell do we get this added to our electric bills in BC?? 90% of our power is hydro generated. Just about the most cost effective and clean power option available.

#55 Rico on 01.10.20 at 7:58 pm

Weird.
Real estate is in a bubble due to free money.
The solution to free money is to increase interest rates, which Canada can’t do unless the US also increases.
Our options are to do something or to do nothing.
Garth complains about the government doing something.
Is your preferred solution to do nothing and the problem will fix itself?

#56 MF on 01.10.20 at 7:58 pm

23 Lee on 01.10.20 at 5:23

Great points. I agree with your prediction as it has already come through.

Close family member works for the federal government. All the older co workers at their workplace constantly lament about how a government salary used to be able to “afford you a home, give you a good living and was enviable”.

Those days are done.

Now the idea is the private sector is where the money is, but benefits may be lacking. Even security is not what it used to be, since tons of employees are on perpetual contract. So it’s a trade off.

Anyone with “pension envy” is just stuck in the 1990’s and hasn’t realized a lot has changed.

MF

#57 akashic record on 01.10.20 at 8:05 pm

There are thousands of homes and condo units used by people who need access to the city for business reasons and for whom hotels are impractical. When all these units were bought, they were taxed. During ownership, they are taxed. When sold, taxed again. Now a 1% vacancy tax on a $700,000 one-bedroom unit used the equivalent of four or five months a year will amount to seven grand – or twice the property tax owing.

Businesses needing to own a $700,000 condo in Toronto will absorb the seven grand. At least it is deductible cost.

But is is fair? – Garth

#58 Linda on 01.10.20 at 8:13 pm

#31 ‘Crowded’ – actually, the robust markets over the past couple of years plus (in our pension case, anyway) increased contributions to make up the pension shortfall have resulted in many public pension plans being fully funded. The plan I’m in went from being some 2.5 billion (with a B) in the hole to having a pension surplus for each of the last two fiscal years. So contributions from both employee & employer have dropped, since the fiscal emergency is currently a non-event. Of course, bad markets or poor investment decisions on the part of the fund managers could see that surplus disappear like snow during a Chinook. Fingers crossed that we continue to maintain 100+% funding, especially if demographics increases the retiree pool as anticipated.

#59 Gas Storage on 01.10.20 at 8:16 pm

Back in the early days of my career, I worked for a certain Alberta gas utility company (well, there is one of note so you can guess). I was in gas supply (no longer exists it’s Direct Energy now). We got hit with some cold temperatures, like really cold, and “day gas” went through the roof. Not quite as bad a California in 2000, but shocking, shocking I say, for the time.

Where was all the gas? Well there was lots but it was also cold out east and it was contracted to go that way or we had to compete based on price. It was an ouch. There was much lamenting in front of the regulator at the next deferred gas account hearing.

This “shock” produced a number of planning scenarios in the subsequent months. One of the questions was “what if we can’t get enough gas at any price???” This is a serious question because if the pipes go empty the regulators (that circular thing by the meter) shut in to prevent air from flowing back into the lines. That means every house that was affected has to be purged and relighted. We estimated that if we lost one major regulator station it would take 20 days to do the purge and relight if every competent employee plus every external gas fitter in the city was on the job 8 hours a day. Hundreds of people could die and the damage from broken water pipes would be horrendous. Lesson learned from this study is the pipes cannot go below pressure even if there is not enough gas for a few days.

So what solution did we come up with to prevent this tragedy? Did you guess it? Do you want a little time to think about it? I’ll spit it out: Rolling power brown outs of the power grid. Yup, get Enmax and Epcor to shut down the power on a rolling bases. Shut down enough furnaces to match the supply. A couple hours here, a couple hours there, shed load. No electricity and basically only the hot water tank still works, maybe the odd gas fireplace.

Fortunately it never came to that.

So why is this interesting today? Because gas storage, which has always been an important part of meeting peak winter demand, is no longer feasible due to hydraulics on the pipeline. Sure they can do some but not like they did. The storage pools are not full. The spreads do not make it economic. The peaking supply is impaired.

So now you know. If the power goes off on Monday night it is because they can’t source the gas to fuel your furnace, but they want to avoid a purge and relight.

And yes this is a true story, although many years old. And it occurs in stages, the first step is to tell the industrials to shut down, followed by the commercials, and then if all that fails, brown outs. They will rotate it so that nobody goes without heat for more than a few hours, but brown it out they will.

Monday is going to be a big test. Can we do without commercial gas storage? We’ll see. But the biggest test will be if after a cold January we also have a cold February. March almost always gets better.

#60 Bytor the Snow Dog on 01.10.20 at 8:22 pm

I am saddened by Neil Peart’s passing. Watch the master at work here:

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

And Garth, at best you are being disingenuous about the funding model for public pensions, at worst you are downright misleading.

You are better than that.

I have one. I know how it works. Fortunately I do not require the money and donate it. – Garth

#61 midnights on 01.10.20 at 8:25 pm

If you have a subscription? Read the Globe&Mail article…Is Justin Trudeau eyeing the exits?

#62 Out Of Work CEO, Will Travel on 01.10.20 at 8:26 pm

Y’all come down to the Rio Grande on South Padre Island and enjoy the good life. I’m talking Peppermint Creme Pie (in the frozen section) on special at Wal-mart for $1.50. Come on I know why all the Ontario plates…you can’t fool me or the pelicans. Yes sir Bob and the cheapest gallon is near $2.17. You can swallow a Margarita for $1.00 at some of the better upscale lounges. Never did I realize how popular Texas was in the 416.

#63 akashic record on 01.10.20 at 8:29 pm

#57 akashic record on 01.10.20 at 8:05 pm

There are thousands of homes and condo units used by people who need access to the city for business reasons and for whom hotels are impractical. When all these units were bought, they were taxed. During ownership, they are taxed. When sold, taxed again. Now a 1% vacancy tax on a $700,000 one-bedroom unit used the equivalent of four or five months a year will amount to seven grand – or twice the property tax owing.

Businesses needing to own a $700,000 condo in Toronto will absorb the seven grand. At least it is deductible cost.

But is is fair? – Garth

Bloody hell, no. It is a shameless populist money grab.

But at least it does not force businesses to move to other cities, as it is often suggested to individuals, if living in TO becomes un-affordable for them, due to reasons, which might also be unfair.

#64 Nonplused on 01.10.20 at 8:34 pm

#57 akashic record

“Businesses needing to own a $700,000 condo in Toronto will absorb the seven grand. At least it is deductible cost.”

No, they won’t, and they can’t. They will pass the cost on to their customers. If that is a foreign entity maybe it works but if it’s Canadian business like say a partner at an accounting firm who has to travel between Vancouver and Toronto then the rates he charges the plumber and tow truck guy to do his taxes are going up.

No tax at any level can help but raise the price of everything, for everybody, including you. Or it can sometimes manifest in reduced wages because the employer cannot afford the tax. But either way we all have to pay. That is how the system adjusts. There is only so much money and if the government scoops some of it all prices need to adjust.

The HST is the most fair of any tax. Everyone can see what it is, and know that no matter what we all pay the same rate.

“Oh well let’s tax the billionaires then!” Well, we already do on any perceived income, and heavily. The problem is that Bill Gates doesn’t have a swimming pool of gold coins in his basement like Scrooge McDuck, he has shares of Microsoft and his wealth is entirely notional. It is not cash until he sells it, and if he does it is taxed, so there is no tax avoidance.

And mark my word, this insanity is just starting. Pretty soon if you have a single family unit on a property zoned R-2 or R-4 you’ll be paying too. Then they will start rezoning everything to R-4. Then they will start coming after your second bedroom if you have a condo. They are coming after all the money, and not just the rich.

Remember folks, there is only so much money. And therefore only so much they can tax. We all pay the same tax rate through the mechanism of pricing. Now, they are trying to monetize notional assets. That cannot work because real assets are not money.

#65 Russ on 01.10.20 at 8:38 pm

Gas Storage on 01.10.20 at 8:16 pm

Back in the early days of my career, I worked for a certain Alberta gas utility company (well, there is one of note so you can guess)…

And yes this is a true story, although many years old. And it occurs in stages, the first step is to tell the industrials to shut down, followed by the commercials, and then if all that fails, brown outs. They will rotate it so that nobody goes without heat for more than a few hours, but brown it out they will.

Monday is going to be a big test. Can we do without commercial gas storage? We’ll see. But the biggest test will be if after a cold January we also have a cold February. March almost always gets better.
===============================================

We had a practice run in southern B.C. just over a year ago, with the Enbridge gas pipe rupture.

Sumas gas price outlook for this Monday is not that bad, only a wee curtailment on the Industrials so far.

Winter heating tip:
It may be cheaper to run an 80% efficient fireplace to keep a couple of rooms toasty warm rather than running a 95% efficient furnace to heat the whole house.
This is our strategy whit the living room at a tropical 80 F and the rest of the house as low as 55 F in the far reaches (near the back door).

#66 Nonplused on 01.10.20 at 8:39 pm

#57 akashic record

Oh and PS, it’s not really deductible. Deducting a tax from a tax is like running in a circle. All they are doing is deciding which level of government gets to slice their meat off the carcass first.

#67 Bytor the Snow Dog on 01.10.20 at 8:42 pm

#43 VicPaul on 01.10.20 at 7:16 pm sez:
“#3 Leo on 01.10.20 at 3:40 pm
Other than CPP, defined benefit pensions are paid for by their members. Not tax payers.

Untrue. There is an employer portion and benefits can far exceed a worker’s contributions over time. – Garth

*******

Admittedly, I’d prefer the DB (thank you 26 year teaching career) but, other than being indexed (and paying out until death), isn’t it much like employers matching employee’s contri’s – ours is not 50/50 but 52% employer/48% employee….except that I’ve been required to pay x% (roughly 12k/yr) to it, like it or not.

M55BC

You paid $12,000 per year into it (pre-tax), with the employer matching? How much annually do you draw? – Garth”

Boy Garth, you’re really being a dick today. How much money would one have if they invested $24,000 PA in a balanced portfolio at a conservative 6% return for 30 years?

He stated $12,000 as the contribution for 26 years. Review the context. – Garth

#68 crowdedelevatorfartz on 01.10.20 at 8:49 pm

@#59 Gas Storage
I found your comments very interesting….”brown outs”, “gas storage”, “purging”, etc …..in a multitude of ways…..

#69 Ustabe on 01.10.20 at 9:31 pm

You pay more to golf the exclusive club links than you do at the municipal course.

You pay more to buy that upscale Audi or BMW than you do for a Yaris.

The higher you go the higher the dues in almost any endeavour. A rib eye costs more than a sirloin steak.

I pay more for my firewood now that I have it delivered opposed to when I took my chain saw and trailer out into the cut blocks and gathered my own.

Whatever it is that I pay (and I do not really know, I engage the services of professionals to look after that stuff) I’m happy to be able to. Plenty left over for me.

Some of you really need to evaluate what it is in your existence that makes you so continuously bitter and angry.

Why the CPC is in disarray continuously on display in the comments here.

#70 SW on 01.10.20 at 9:38 pm

#39 Nonplused on 01.10.20 at 6:48 pm
“One thing I never figured out is where all the used equipment stores went. You’d think there would be pretty solid demand, especially for kids equipment.”

I guess you guys pulling the wings off butterflies don’t get out much.
Google Play It Again Sports. Or go to a charity shop or (not not for profit) Value Village. It’s not that cheap as it’s a brisk market.

#71 TurnerNation on 01.10.20 at 9:39 pm

KANADA in ONE CHART. True Dough is here. Subprime Slime.

GSY.TO alt/scuz lender: $16 in 2016; $75 today. No sign of stopping.

Go easy/Easy Home https://www.goeasy.com/

Blehhh!!

#72 n1tro on 01.10.20 at 9:41 pm

#38 DFO on 01.10.20 at 6:47 pm
I’m all for vacancy taxes because it encourages people to contribute to the local economy.

Cry me a river if your short-term business person rental in a private residence is subject to vacancy taxes. What use is a private residence that doesn’t house a person who contributes to the day-to-day economy?
———-
I doubt your “contribution” to the day to day economy amounts to much if you live off on envy of others. I bet I contribute more to the day to day economy than you so that must mean I get a bigger share of the tax stolen from the rich guy with all the empty houses right?

#73 ImGonnaBeSick on 01.10.20 at 9:46 pm

#32 Dutchy on 01.10.20 at 6:08 pm
Very nice Garth,
Wonder how many readers Googled “lepidopterologists”

—–

Hopefully all of them… Completely odd to use/know that outside of the field…

#74 n1tro on 01.10.20 at 9:47 pm

#41 I’m Alright Jack on 01.10.20 at 7:00 pm

Thank you for your service kind sir.

#75 VicPaul on 01.10.20 at 9:51 pm

#47 crowdedelevatorfartz on 01.10.20 at 7:30 pm
@#43 VicPaul
” (thank you 26 year teaching career)…retired at 55…
++++

Wow !
You slaved behind a desk for a whole 26 years…the horror.
The private sector is just hitting their stride at 26 years…
Did you book off on stress leave ?
Zero Empathy for govt workers whining about how hard they have it.
Especially when I deal with them on a daily basis.
Underworked, overpaid, entitled, lazy, sloths that are too stupid to realize how good they have it….
The day of reckoning is coming folks.
Count on it.

******
Do you genuinely struggle with reading comprehension, or are you using my comment as a set-up to trot out (again this week) your unbridled resentment for anything public sector – your constant whining has long ago gotten old.

#76 VicPaul on 01.10.20 at 10:10 pm

47 crowdedelevatorfartz on 01.10.20 at 7:30 pm
@#43 VicPaul
” (thank you 26 year teaching career)…retired at 55…
++++

Wow !
You slaved behind a desk for a whole 26 years…the horror.
The private sector is just hitting their stride at 26 years…
Did you book off on stress leave ?
Zero Empathy for govt workers whining about how hard they have it.
Especially when I deal with them on a daily basis.
Underworked, overpaid, entitled, lazy, sloths that are too stupid to realize how good they have it….
The day of reckoning is coming folks.
Count on it.

********

Do you genuinely struggle with reading
comprehension or were just using my comment as a setup for your weekly whine about anything public sector? What did I “whine” about? Where did I say I was retired? I continue to educationally tussle with six and seven year-olds five days a week (I’ve taken two medical days this year – never taken any other leave). Retirement comes at 60 – after 30 years of teaching kiddos to read, write, sing….and not poke each other in the eye.

I’d appreciate you not attributing your wrongful, vitriolic assumptions to my life.

M56BC (forgot I had a bday)

#77 fishman on 01.10.20 at 10:18 pm

I got Residential/Commercial west side Van. Commercial goes down: Residential goes up. Residential goes up: Commercial goes down. Its called sucking & blowing at the same time. Van City Council is pretty good at it. How about that secret sign revealing yesterday?
I made the sign over my heart today & all my “Man Crushes” flooded out. Matt Dillon, Pallidan, Rowdy, Burt Lancaster,Gorgeous Goerge, Cassius Clay, Preston Manning & now of course the Trumpster. It was love at first sight when he came down the escalator with his Slavic Princess. Developed into an epic “Man Crush.
With the secret sign revealed on the pink sign we can all have “Fantasy Man Crushes” too. Right now I’m Crushing on Mr. Grumpy our Fearless Bearded Leader aka Gartho the Great.

#78 Rexx Rock on 01.10.20 at 10:29 pm

DELETED

#79 n1tro on 01.10.20 at 10:36 pm

#76 VicPaul on 01.10.20 at 10:10 pm

I’ll thank you for your service and dedication to teaching children all these years. You may be the exception rather than the norm of dedication.

When you see the laziness and entitlement day in and day out, you must understand it jades you. Look the what’s going on in Ontario right now. You can almost set your calendar to a teacher strike followed shortly by one from Canada Post. Apparently getting that 4% wage increase is “for the children” or “maintain the level of service”. I remember when I was in high school years back the same crap was being demanded…smaller class size, higher wages….all “for the children” of course.

#80 Shawn Allen on 01.10.20 at 10:57 pm

Pensions

#35 Jack on 01.10.20 at 6:23 pm
Regarding the dispute on the pensions, the key point that most people miss is “Defined Benefit”. If it was “defined contribution” then it really does not differ from RRSP or anything similar. The problem is the overly promised benefit that has to be covered by the employer (in most cases, the government – tax payer), regardless how the contribution is divided.

**********************************
In Alberta the government employees pay half the cost. Contributions were close to tripled over the years per $1.00 of wages to fund the employee’s share of the shortfalls.

The government as employer was at risk for shortfalls. Employees still working were at risk. All retirees are no longer at risk once they are retired.

Fairness might have dictated some haircut for retirees such as no inflation increase for a number of years. But the pension promise has been fully kept, to the penny.

#81 Sail Away on 01.10.20 at 11:03 pm

47 crowdedelevatorfartz on 01.10.20 at 7:30 pm
@#43 VicPaul

” (thank you 26 year teaching career)…retired at 55…

——————————–

Wow !
You slaved behind a desk for a whole 26 years…the horror.
The private sector is just hitting their stride at 26 years…
Did you book off on stress leave ?

Zero Empathy for govt workers whining about how hard they have it.
Especially when I deal with them on a daily basis.
Underworked, overpaid, entitled, lazy, sloths that are too stupid to realize how good they have it….

The day of reckoning is coming folks.
Count on it.

———————————

Fartz, quit whining. You had equal opportunity to teach or work for the govt. You decided another path.. so be an adult and own your choice.

Envy is unattractive and counterproductive. You sound a bit like Sunshowers or that fool M. Realist who also whine about everything.

#82 Shawn Allen on 01.10.20 at 11:04 pm

A fantasitc private sector pension

Check out CN’s pension. They have had absolutely stellar investment success for years. I don’t think it ever got under funded in the last 20 years. The company actually books a pension profit some years because the growth in assets has been so strong. Great DB plan.

I think perhaps the company covers it all, but I ma not sure.

I suspect the banks also have some great DB pensions. Also the Telcos and many or most utilities. Some have converted new employees off the DB however.

But some great private DB pensions do still exist.

As others have said, OMERs is in great shape. Many of the Canadian government pension plans including Ontario Teachers are the envy of the pension world. I believe that includes CPP. Probably not the federal plan though.

#83 SunShowers on 01.10.20 at 11:21 pm

“Full-time work” is a meaningless metric if the wages are insufficient.

#84 Linda on 01.10.20 at 11:46 pm

#73 ‘I’m’ – not necessarily. Anyone who reads extensively is likely to have come across the term. Most gardeners would likely know what it meant without a Google search as well.

#85 Nonplused on 01.11.20 at 12:26 am

#65 Russ

Your winter heating tip will work for certain houses and how they are used but not all. We only have 3 rooms in our house that are not occupied every day, of which one is a cold room so it is not heated and the other 2 have in floor heat that also heats my wife’s office (she works from home). So the best we can do is keep the thermostats down, which we do in the house and garage using those programmable units but those don’t work for in-floor heat so I just keep it at 65 and my wife will use an electric heater if her office gets too cold. There are many different strategies and it really depends on what your situation is.

Incidentally I don’t know how much energy those programmable thermostats actually save when you are dealing with -38. The one in the garage is a good example. At night it goes down to 50 degrees (F) so for most of the time it will not run at all at night (can’t go to no heat too many things in there that don’t like freezing). But when it kicks on because I am planning to do some work in there (it is my shop too) it can take the heater a full hour or more to get back to 70. And it isn’t that big! The problem is when you let everything cool down overnight you have to heat everything back up in the morning, including the furniture and tools and cars.

Another way to avoid heating unused rooms is with the vents. Not perfect but it is something.

#86 Nonplused on 01.11.20 at 12:35 am

#70 SW

The Play it Again Sports and the Sports Swap around here both went tits up. The Chinese made equipment is too cheap new for them to make a profit at a 50% markdown on used stuff and return half of that to the original owner. There wasn’t enough margin. We had a nice fancy Sports Swap not far from where I live in a brand new building. It is now a Memory Express.

Before the Play it Again closed I tried to bring some of my son’s hockey equipment in that I had bought brand new and they wouldn’t take it because they couldn’t sell it. Not even for free. It is still in the closet. I tried to sell it on eBay but the only things that went were the skates and the gloves.

#87 Nonplused on 01.11.20 at 1:07 am

Oh and PS #65 Russ

A pipeline burst in the winter can be a traumatic event for a gas system, but if there isn’t too much damage they can have the gas flowing in a couple weeks or even less, sometimes a few days. And then hopefully the odds go in your favor and the pipe does not burst when it is -38 C.

But when you don’t have enough gas available due to storage and pipeline constraints, prices go crazy first and then they step through the demand shedding schedule.

And the problem is not that there isn’t enough gas in Alberta or BC, there is plenty. But by contract we cannot curtail exports. We have to suffer the same pain our export customers do, or at least did at the time. I believe Klein changed that but it takes an act of government to divert exports and I don’t think it was ever tested. At least until Monday. The idea the importers like California and Ontario have is that it is our problem if we don’t plan for our winter and they need the gas just as much and they paid for it.

Interesting terms arose during that winter. “Backhauling” was my favorite. It meant buying gas from Ontario utilities, paying their fixed-firm transportation charges to Ontario on TCPL, and then using the gas in Alberta. Which was produced in Alberta.

Sometimes mother nature gets the best of you. The problem is that there are so few really cold days and the demand goes up so much that it is really hard to justify building sufficient storage and then filling it up with gas you have to pay for today but might not sell for years. And since we’ve been in a gas glut, they aren’t even filling the storage facilities they have because there is no margin.

This is one thing that actually worked better when the engineers did it instead of the economists. Economists do not plan for the 100 year flood. Engineers do. Economists only think in averages, no matter what the standard deviation of the data set might be.

About the same time as the rest of this story, our economists at the gas company decided that we weren’t getting enough revenue in the summer (August can be 10% of January, look at the graph on your bill), so they decided we should look at the ratio of hot water tanks to furnaces BTU to decide the baseload. But for consistency to the government that meant we had to do our load calculations using that assumption. It meant we were buying way too much gas in the summer and had inadequate supplies on cold days in the winter.

Always remember the sad case of the economist who drowned in a river that had an average depth of 6 inches. That doesn’t happen to engineers, no matter how much the economists laugh that the engineer brought a canoe.

#88 Nonplused on 01.11.20 at 1:20 am

Oh and another fancy term I learned in those days was “sendout”. Here was the magical concept that when it got really cold demand leveled off at a certain temperature. See? Look at that? We only have to plan for -40. No you idiots what happened was the furnaces were all already running at 100% and the houses cooled off. But given the rare occurrence that is perhaps it was the best solution rather than over-building.

But for anybody who is still talking about sendout realize what is really happening is that the day is colder than what was designed for and the furnaces just can’t make anymore heat than they are. It only happens once in a while and that’s why you have all those sweaters in the closet.

#89 WUL on 01.11.20 at 1:25 am

Garth,

I’m pining for the dulcet tones of the voice of Cici. Email her and tell her that I hope she has not lost my number.

It’s real cold these days in Fort McMurray and this is my first venture into online dating. Honest.

If you do, I’ll place my vast wealth in your hands to invest on my behalf and squander it. That’ll take about 5 minutes.

By the way, Oilers vs. Flames tomorrow night. Hope she’s a hockey fan.

Thx,

WUL

#90 Russ on 01.11.20 at 1:37 am

I ImGonnaBeSick on 01.10.20 at 9:46 pm

#32 Dutchy on 01.10.20 at 6:08 pm
Very nice Garth,
Wonder how many readers Googled “lepidopterologists”

—–

Hopefully all of them… Completely odd to use/know that outside of the field…

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

I think Garth did this to draw the attention of the aurelian. These guys hate the modern reference.

Cheers, Russ

#91 Al on 01.11.20 at 2:29 am

“I have one. I know how it works. Fortunately I do not require the money and donate it. – Garth,”

I would too if I were you, especially if I needed it ;) – NS

#92 crowdedelevatorfartz on 01.11.20 at 8:12 am

@#52 USA USA
“If this was USA, people would have revolted. Canadian are timid.”
++++

At least we’re not revolting…..

#93 crowdedelevatorfartz on 01.11.20 at 8:22 am

@#81 Sail away
“Envy is unattractive and counterproductive.”
++++

I think your confusing my disgust with your envy.
And every time teachers go on strike …”its about the kids….”
Riiiiight.
Oops.
Cant afford to give the union extortionists more money?
No problem, just tack on another “Professional Developement” day to the ever growing days off in the school year…
How many months off in a 12 month work year?
3.5 months? 4 ?

No wonder so many parents are putting their kids into expensive private schools or expensive after hour lessons.
The Politcially Correct Indoctrination Centers ( aka public schools) are too busy finger painting placards for the next protest they can send the kids to.

#94 crowdedelevatorfartz on 01.11.20 at 8:38 am

@#76 Vitriolic Paul
“I’d appreciate you not attributing your wrongful, vitriolic assumptions to my life.”
+++++

You forgot “bullying”.
Go out your pink t shirt on and come back. I’ll wait.

When you bragged “(thank you 26 year teaching career).
One would assume you were speaking in the past tense for your employment.
You get to slave for another 5 years. The horror.
Be kind to the elderly Wal Mart greeters.
It could have been you in another non govt guaranteed pension life.

So you work with 7 year old kids.
A room full of disease-filled petri dishes as it were.
And you’ve only taken two sick days off this year?
Impressive.
But I’m sure dealing with the parents of the kids is far more stressful.

#95 KS on 01.11.20 at 9:37 am

I was wondering if anyone has any idea if using the app MINT was safe? Just curious.

#96 Dharma Bum on 01.11.20 at 9:52 am

The sad part is that after all is said and done, Toronto residential property taxes STILL need to be increased by far more than 8% to feed the beast.

Property taxes have to rise a minimum of 20% – 25% to even begin making a dent in the revenue shortfall.

Anyone that craves living in the city should have to cough up the vig to maintain the privilege. This isn’t your grandpa’s city anymore. It’s a cash hungry behemoth that needs 50 years of infrastructure catchup to be funded.

Perhaps we will then also see a significant drop in the prices for resale homes in Toronto.

Win – Win.

#97 neo on 01.11.20 at 10:14 am

#96 Dharma

There is no political will to do so. People want their cake and eat it too. Kick the can down the road until it lands in a pothole.

#98 Sold Out on 01.11.20 at 10:29 am

#93 crowdedelevatorfartz on 01.11.20 at 8:22 am
@#81 Sail away
“Envy is unattractive and counterproductive.”
++++

I think your confusing my disgust with your envy.
And every time teachers go on strike …”its about the kids….”
Riiiiight.

×××××××××××××××××××××××××××

If it were truly disgust motivating you, wouldn’t it make sense to direct that disgust towards the employer, rather than at the employee? When you attack the individual, it’spretty clear that you’re motivated by envy of their specific situation. But by all means, pull a Lenny Bruce – “Deny, deny, deny, even if they’ve got pictures”- sometimes it works.

Sheesh, talk about a pot full of Canadian crabs. Maybe blame your own choices, instead of wishing that everyone else be dragged down to your level of misery. Every worker protection that we enjoy, whether in the public or private sector, came about because of unions. Build a bridge, get over it.

#99 GrumpyPanda on 01.11.20 at 10:40 am

34 years ago I said to my teacher roommate “Teachers have to work hard.” she told me they have to work really hard the first year setting up lesson plans. The second year you refine them and after that it is pretty easy to coast if you want.
I was shocked. Oddly, so has been every teacher I ever told that story to.

#100 NotLegalAdvice on 01.11.20 at 11:23 am

Some dude said:
“And Garth, at best you are being disingenuous about the funding model for public pensions, at worst you are downright misleading.

You are better than that.”

________________________________________________

I have one. I know how it works. Fortunately I do not require the money and donate it. – Garth

__________________________________________________

Donations can be made out to my law firm (opening by EOY…..maybe) lol

#101 Doug in London on 01.11.20 at 11:45 am

So Canada created over 35,000 jobs last month. I recall a lot of bitching, whining, and bellyaching about how Canada lost jobs the previous month while there were job gains in the United States. It looks like all that worrying about job losses in November was a tempest in a teapot, much like worrying if the TSX lost a “catastrophic” 100 points on the last trading day.

#102 Midnights on 01.11.20 at 6:08 pm

Martin Armstrong on…
https://www.howestreet.com/2020/01/martin-armstrong-manipulating-the-world-economy-ross-clark-this-week-in-money/?unapproved=361220&moderation-hash=14a0f804e4d7812bbfb5edc9d509b098#comment-361220

#103 PAULLY on 01.11.20 at 6:09 pm

#96 Dharma Bum on 01.11.20 at 9:52 am
The sad part is that after all is said and done, Toronto residential property taxes STILL need to be increased by far more than 8% to feed the beast.

Property taxes have to rise a minimum of 20% – 25% to even begin making a dent in the revenue shortfall.

Anyone that craves living in the city should have to cough up the vig to maintain the privilege. This isn’t your grandpa’s city anymore. It’s a cash hungry behemoth that needs 50 years of infrastructure catchup to be funded.

Perhaps we will then also see a significant drop in the prices for resale homes in Toronto.

Win – Win.

———————————————-

Totally agree!!