News you can use

Covid Diaries date 28.8.20. Hey, if Melania can be upbeat about her captivity, so can we.

Go Prefs!

When the virus came to town central banks crashed interest rates, crushing bond yields and preferred share values. Bond prices jumped, but prefs tanked. And what did this pathetic blog suggest? You bet – buy some preferreds. They’re cheap, we enthused, they chuck a handsome dividend, are tax-efficient and pretty much guaranteed to jump in value once the economy reopens.

Well, as it turns out, you didn’t need to wait that long.

Yes, interest rates are still in the ditch and will likely stay there for two or three years. But pref ETFs have now jumped more than 40% in value since March 23rd, they pay a juicy 5% (compare that to a 1% GIC) and you can collect the dividend tax credit. What’s not to love?

And look what the dudes running the Royal Bank just did!

RBC on Wednesday announced it’s redeeming about $1.5 billion worth of outstanding preferred shares – buying back six different issues at the price of twenty-five bucks. This comes on the heels of the bank issuing new debt last month, so a truckload of dollars will be looking for a new home – plus the outstanding supply of prefs has just been reduced. “This is huge!!” says my suspending-snapping portfolio manager buddy Ryan, who has far too little stimulus in his life. “If other banks follow suit this would add to the reduction of supply and be very positive for the pref market!”

In case you missed it, prefs swelled on Wednesday like a lovesick guppy.

So, you took the advice five months ago, right? By the way, our balanced portfolio model currently holds about 13% in prefs. The remainder of the 40% in fixed-income assets is government, corporate and provincial bonds and a smidgeon of cash. The overall yield of the bonds and prefs is about 3.75% – money you make while sleeping. The capital appreciation in preferred values is on top of this. Thanks, RBC. Love ya.

The kiss of death

BC, there were more than 22,000 Airbnb listings in Toronto alone. Today there are 90% fewer. And things are about to go from awful to terminal for those who have hung on to their vacation-rental condos, waiting for Covid to go away and the tourists to return.

Come two weeks, there’ll be new rules which will (a) destroy commercial Airbnb hosts, (b) free up more rental units, (c) help push lease rates lower and (d) suck more air out of the condo market. On September 10th all short-term rental operators will have to register with the city and collect tax (as in Vancouver), plus it’ll be illegal to have an Airbnb space not inside your principal residence.

Pow. This means some massive condo complexes (like the infamous ICE, downtown) which used to house hundreds of short term rental units bought by amateur landlords and specuvestors are now financially sinkholes for them. It’s the end of ghost hotels. Hallelujah.

This is welcome news for people who actually live in those buildings and are tired of the partying transients with their lousy garbage-room habits and suitcases – probably laced with Covid-carrying bedbugs – stuffing up the lifts. For renters it translates into hundreds, maybe thousands of new apartments coming onto the market as owners scramble for revenue and compete with rent cuts. And there’s already evidence of the impact on real estate, as condo listings explode, inventory builds and prices start to erode.

Local pols did the right thing. It only took an economic disaster, which they’re making a little worse, to get there. Good job.

Pressing your luck

As noted here days ago, five-year insured mortgages are now available for the ridiculously low price of 1.5%, or about half the going rate of 18 months ago – thanks to the bug. Cheap money lets people be even more irresponsible, hedonistic and house-horny than in the past, increasing their borrowing limit, allowing them to spend an additional amount on an inflated house in a bidding war conducted by a rockstar realtor who makes more than a cardiac surgeon.

Well, we’re apparently not done yet. The one-five barrier may be broken before long. Mortgage broker celebrity (only in Canada) Rob McLister is calling for a 1.49% home loan before long as US long bond yields flutter lower. But he’s also a responsible cookie, adding this: “Canadians already enjoy tremendously low (record low) rates. Insured rates are now just 10 bps away from 1.49%. If your mortgage closes in the next 120 days and you plan to lock in, be careful about pressing your luck too much.”

BTW, he brings some news on mortgage deferrals. Seems homeowners who stopped paying in March and April are still not making payments – at least to the major banks. In fact at Scotia, for example, the number of deadbeats has actually increased over the summer. So will the market plunge over a deferral cliff, come October?

We shall know soon enough. Curb your FOMO.

114 comments ↓

#1 NoName on 08.26.20 at 3:15 pm

National dog day, today woof…

#2 Andrewski on 08.26.20 at 3:18 pm

Thanks for the free advice Garth. Absolutely love the Prefs I invested in through my non-reg account.

#3 Captain Uppa on 08.26.20 at 3:18 pm

I am giddy over my early no penalty renewal coming up in January.

No pushing my luck, gonna lock in at least a 5’er, but eyeballing the 10 year!

#4 Brett in Calgary on 08.26.20 at 3:24 pm

The article below must have really pained the CBC to print. Siddall airing the dirty laundry… Alberta has a whopping 21% deferral rate! WOW.

https://www.cbc.ca/news/canada/calgary/cmhc-mortgage-deferral-1.5700021

Just like Garth’s timely advice on preferred shares, heed his/Siddall’s advice on housing. Opportunity abounds in 2021.

#5 mj on 08.26.20 at 3:24 pm

Jerome Powell is speaking tomorrow. Some are saying he might suggest that they won’t increase rates for 5 years.

He will never say that.- Garth

#6 polecat on 08.26.20 at 3:28 pm

Ottawa market is crazy, one just went 100k over ask. Glad to lay low but feel for people getting in at this time.

#7 paulo on 08.26.20 at 3:30 pm

About time the air b&bs tax evasion scam was knee capped, in fact the province should adopt Toronto rules across the board and end the ghost hotel game or at the least areas such as Barrie,Orilla,Guelph etc should adopt the measures if druggie is not up for it. cudos to the big smoke politicos on this call.

#8 paulo on 08.26.20 at 3:32 pm

Opps “druggie” should read “Duggie” spell check sucks

#9 Howard on 08.26.20 at 3:39 pm

Canada is more than $1 trillion in debt. No successful industries to speak of at the moment. Low wages, high housing costs, lousy quality of life, set to get worse. The middle class pays the bills while Trudeau’s trust fund circle gets the juicy contracts in what is clearly the most corrupt government in generations. Two innocent Canadian men languishing in Chinese jails.

And what does Radio-Canada (French CBC) obsess over at Erin O’Toole’s first press conference?

Apparently several years ago O’Toole voted in favour of taking into account the life of an unborn child in cases where the mother is attacked by an assailant. This is “scary” to the cultural marxists at Canada’s state-run media.

The CBC cannot be defunded soon enough.

#10 SnowOwl on 08.26.20 at 3:42 pm

Great stuff as always, Garth. What about utilities in your portfolio? Can you consider them as a sort-of substitute for fixed income? Or what about some international REITs? VNQI has an 8% dividend for example.
Thanks!

#11 Dolce Vita on 08.26.20 at 3:51 pm

Evan Siddall, Aug 25 [Twitter]

Further data on @CMHC_ca [no further data there as of 2130 h CET]

“Deferral rates, with most July data, by province:

AB 21.0%,
SK 14.8%,
NL 14.8%,
BC 11.1%,
ON 10.1%,
3 territories 9.9%,
NS 9.9%,
MB 9.6%,
NB 9.3%,
PEI 8.4%,
QC 5.6%.

Deferrals in oil producing regions are evidently elevated.”

https://twitter.com/ewsiddall/status/1298338009197301760

———————————————–

No $ values given. I assume they are insured mortgages if data from CMHC?

Eyeball estimate, 10% of Cdn. mortgages deferred.

Could be worse (e.g., 8.6M on CERB, 20M workforce = 43%)

#12 HoweStreet.com on 08.26.20 at 3:54 pm

Ross Kay on HoweStreet.com Radio:
#1 Wealth Building Strategy Of All Time.
Negative Interest Rate Mortgages are here.

https://www.howestreet.com/2020/08/negative-interest-rate-mortgages-ross-kay/

#13 Mint Julep on 08.26.20 at 3:54 pm

Re: breaking a mortgage. I’m sure you’ve addressed this already in another post, but what if you still have a few years left on your current term? Should you consider it even if it is less than a 2% difference between current rate and advertised? Will breaking a mortgage impact your credit rating? What are the risks?

#14 Dolce Vita on 08.26.20 at 3:54 pm

“Covid Diaries *date 28.8.20.”

*star

#15 be careful about pressing your luck on 08.26.20 at 4:02 pm

Hi Garth thanks again for the blog

May I ask what exactly did you mean by saying
be careful about pressing your luck

Are you saying the bottom for mortgages will bottom in the next 120 days so don’t press your luck beyond this date?
Groan my mortgage is up for renewal in June 2021 I believe I can get a rate guarantee in January.

Thanks

#16 PBrasseur on 08.26.20 at 4:07 pm

Melania is happy cos she read the last poll

https://thebl.com/politics/rasmussen-poll-president-trumps-approval-rating-among-black-voters-hits-all-time-high-in-the-wake-of-rioting.html

Why would you link to a 3-month-old poll? – Garth

#17 willworkforpickles on 08.26.20 at 4:09 pm

The Fed is headed for some really tough decision making ahead. Powell may even resign.
If this second wave of covid-19 does burst back worse than the first and unemployment continues to increase beyond where it stands now at nearly 3 times the highest levels seen in the last recession…runaway QE infusions of cash will be the only savior.
In these days of low production/high unemployment it can only add tremendously to inflation over time.
Does the Fed let it snowball hurting consumers in an already hurting economy in this recession, or opt for higher rates slowing down the stimulus to spend and attempts to decrease unemployment just to keep inflation in check?
It’s a double edged sword for sure. Powell must be quaking in his boots looking ahead to 2021.

#18 Linda on 08.26.20 at 4:10 pm

Interesting news regarding AirBnb. So the question I have is, if someone can only operate AirBnb in their principle residence, doesn’t that impact their capital gains exemption if/when they sell? Also the owners are supposed to declare that income to the taxman. So either people pretend they have a very large circle of friends/family coming to stay year round or hope that no one notices/reports the activity. Good luck with that.

#19 JB CONDO DEATH on 08.26.20 at 4:10 pm

The end of the investment CONDO HELL as we know it. They will all be turned into a RENTAL HELL. Same old same the owners that legitimately lived in these places now have to deal with Renters. Depressing really.

#20 FreeBird on 08.26.20 at 4:12 pm

So Jim Cramer/MSM weren’t to be trusted on all the facts. Shocking. Maybe AirBB is going public hoping to attract same RobinHood investors as Hertz etc?

Fool me once…

#21 Asterix1 on 08.26.20 at 4:14 pm

Many in ICE condo and others in the downtown core will need to sell their units ASAP. Renting them out to an average Joe for 1+ years will not cut it.

They paid a huge premium to buy the « hotel condos » next to sporting venues and CN tower. Check out HouseSigma, lots of crazy buys for minuscule units in past few years.

Also please, don’t believe MSM and RE trash news, prices are not going up, you will pay less than last year for anything in GTA. Average price is up, yes, but it’s a meaningless stat, it’s all about the sales mix at a given time.

#22 Dolce Vita on 08.26.20 at 4:17 pm

Off topic, a bit.

A lot of Twitter armchair quarterbacks trying to explain the % deferral rates by Province provided by Siddall in his Tweet.

One Commenter [agent1] gave up on explanatory charts for Siddall’s data and instead decided to provide a Year 2020 “Relative Importance” plot:

https://twitter.com/SportsHandicapl/status/1298394906747166720/photo/1

In Human Nature we Trust.

—————————

There are some very good comedians out there, at large, even if they are somewhat perplexed about the importance of masks.

#23 Billy Buoy on 08.26.20 at 4:24 pm

You just got to love ex Central Bankers…

The idiot (cough person) who claimed “We will NEVER see another financial crisis as long as I live” in 2017. …

Ol Yeller (dog reference in keeping with this blog) Janet Yellen said Monday in a NY Times piece:

“If senators still fail to resolve stalled negotiations when they return after Labor Day, millions of needy Americans will suffer — and the overall economy could degrade from its current slow rebound in growth to no growth at all,”.

Gee this is coming from the idiot who helped Bush and Obama blow various Bubbles sky high and was afraid to raise rates….

Don’t worry folks, the TRILLIONS WILL BE printed to make Janet and co. “feel better” about helping the “poor people” temporarily, while any one else with assets will continue to see them keep growing and growing.

KEEP BUYING THOSE HOUSES, the FED and company have your backs!

#24 Bill on 08.26.20 at 4:27 pm

#10 SnowOwl
Best REIT manager anywhere…Jeff Olin vision capital..has outperformed TSX by 500% in 10. Shorted Alberta before the meltdown.
Easy to buy and diversified…Do your own Doo dilly.

#25 Comrade on 08.26.20 at 4:30 pm

Nah no cliff, the government will intervene, and will throw more money and let people defer the payments even further. What is a few more billions to the pile.

The party may end, but not just before highly possible fall/spring elections.

How about inclusive, fair and affordable(free) housing for all, as the next election promise?

#26 Sara on 08.26.20 at 4:36 pm

#18 JBCondoDeath “The end of the investment CONDO HELL as we know it. They will all be turned into a RENTAL HELL. Same old same the owners that legitimately lived in these places now have to deal with Renters. Depressing really. ”

Yeah because renters are low-lives (sarcasm off).

#27 Sara on 08.26.20 at 4:41 pm

Ooops. Hopefully it was obvious I was being sarcastic in my last comment. Nothing wrong with being a renter. Makes a lot of sense these days. It’s time to stop equating renting with being a loser.

#28 Billy Buoy on 08.26.20 at 4:44 pm

You also have to just love this one from the USA.

https://www.thestreet.com/mishtalk/economics/mortgage-lenders-ask-new-question-do-you-you-intend-to-pay

Do you intend to pay your mortgage? Really?

Really.

#29 Papabear on 08.26.20 at 4:47 pm

Good post about Airbnb. Thank you, Garth.

I’m glad to see it getting curtailed a bit after so many years of free reign. This should be duplicated across the country and other major cities.

All the best everyone, and remember to stop reading the comments section.

#30 Mattl on 08.26.20 at 4:53 pm

#13 Mint Julep on 08.26.20 at 3:54 pm
Re: breaking a mortgage. I’m sure you’ve addressed this already in another post, but what if you still have a few years left on your current term? Should you consider it even if it is less than a 2% difference between current rate and advertised? Will breaking a mortgage impact your credit rating? What are the risks?

—————————————————-

No risk, but you need to understand the numbers. I broke one a few years back, cost me 11K to break and saved me 20K over what would have been the remaining term. Was an easy call.

#31 Inequity on 08.26.20 at 4:56 pm

#22 Billy Buoy

The two most relevant things about the US are:
Its a good place to help diversify your portfolio.
Its important that we keep the borders closed as the plague infested citizens fight and riot among themselves.

#32 nah on 08.26.20 at 5:03 pm

So! if any of you were paying attention, remember about 12 months ago, when there were somewhat negative comments here regarding pref,s I told you that at the right price they are a very steady source of income. I have had over 10,000 for a few years now and they have been kicking out a steady stream of dividends at 5.5% to 6%. Been delightful and rewarding in this age of extra low pay bank rates. You have to read the legal terms with care and at some date let them roll over at the rates which were set 3 – 5 years ago, somewhat lower but still 2-5% better than GIC or Bonds. They do not have the same guaranteed backing, but how many alternatives are there for the average investor?
Don’t go for the less reliable (ie bigger payouts), just stick with banks and their like.

Actually invest through an ETF. – Garth

#33 ImGonnaBeSick on 08.26.20 at 5:06 pm

#21 Asterix1 on 08.26.20 at 4:14 pm
…. it’s all about the sales mix at a given time

—–

Mark? Is that you? Prices haven’t gone up since 2015

#34 Dogman01 on 08.26.20 at 5:11 pm

All Canadians should read this and ask our government why so friendly to China these last decades? – it is outrageous.

https://globalnews.ca/news/7275588/inside-the-chinese-military-attack-on-nortel/

“And as a result, in 2009 — after getting massively underbid on a series of contracts by China’s state-champion company Huawei — Nortel went bankrupt.”

But typical of Western executive leadership ethos, no long term thought to what was going on;

“Nortel’s brass was mostly disinterested in the investigation and did little more than change executive account passwords. He says they were more focused on year-to-year profits”
“Western companies die when costs rise above sales. By 2008 Nortel was in trouble and it desperately needed to land the 3G Universal Mobile Telecommunications wireless contract offered in Canada by Telus Corp. and BCE Inc. But Huawei won the deal by underbidding Nortel an estimated 40 per cent”
Thousands of decent Jobs lost just in Calgary as the Nortel factory closed here, ( I had a few 20 something friends working there, NE Police Station now).

Huawei is a state sponsored enterprise and its goals are not to “create shareholder value” it’s goals are to further the aspirations of the Communist Part of China and the “100 year Marathon”.

They are drinking our Milkshake
https://www.youtube.com/watch?v=a5d9BrLN5K4

#35 Julian on 08.26.20 at 5:11 pm

Is there a chance that the provincial government could override / vacate municipally imposed short term rental (namely Airbnb) rules in response to lobbying from the negatively affected parties?

I mean if condo prices do actually take a substantial hit, I’m sure the cries for relief will be very loud.

#36 PBrasseur on 08.26.20 at 5:16 pm

A more recent poll for you to ponder…

White House Watch: Biden, Trump In Near Tie

https://www.rasmussenreports.com/public_content/politics/elections/election_2020/white_house_watch_aug26

This is a compliation of US polls. Might be more illuminating for you. – Garth

#37 dr talc on 08.26.20 at 5:18 pm

Principal residence is a ‘designation’ on a CRA form. In fact the ‘designation’ occurs After you sell.

#38 Howard on 08.26.20 at 5:22 pm

#28 Billy Buoy on 08.26.20 at 4:44 pm
You also have to just love this one from the USA.

https://www.thestreet.com/mishtalk/economics/mortgage-lenders-ask-new-question-do-you-you-intend-to-pay

Do you intend to pay your mortgage? Really?

Really.

————————————-

Yeah.

Wolf Richter touched on this new phenomenon a few weeks ago. Payments are now effectively optional.

https://wolfstreet.com/2020/08/07/no-payment-no-problem-bizarre-new-world-of-consumer-debt/

“This is the utterly bizarre new world of no-payment-no-problem-credit, where debt payments are being put on ice, and were delinquencies are routinely cured by modifying loans, and then by sheltering the loans in forbearance programs. The missed interest payments are added to the principal balance of the loan, and the burden of those debts grows, even as the banks book the interest income of those payments that haven’t been made.”

#39 Bill on 08.26.20 at 5:29 pm

#34 Dogman01 on 08.26.20 at 5:11 pm
Huawei is a state sponsored enterprise and its goals are not to “create shareholder value” it’s goals are to further the aspirations of the Communist Part of China and the “100 year Marathon”.
—————————————————
Yes I installed the 1st Nortel CDMA base stations on earth in Burnaby waaaaay back. They were $250k. An Huawei site about $35k. CCP had a plan to destroy NT and deploy the massive subsidized equip…theres no environment over there, slave labor ect. Nortel also got stupid and lazy. Sad 100k of Canadian jobs down the tube.
Huawei needs the boot and its happening.
Our gov has pandered to them for years. Maybe we need a new flag.

#40 BillyBob on 08.26.20 at 5:36 pm

No mortgage. Paid cash. The hard-earned tax-free gains of years of hard graft being a stranger in a strange land.

Tired of hearing low-rate loans referred to as “free money”. Debt is the opposite of freedom.

One of my major equity ETF’s (VWRD) bottomed out at $63 USD a share on March 23. Today it closed over $96 USD.

I’ve made more money unemployed this year than I did employed in the last 2. During the worst pandemic in 100 years.

We are truly living in the Upside Down.

But fine by me.

#41 Timmy on 08.26.20 at 5:41 pm

No matter what happens, prices in Vancouver don’t seem to go down. I would have thought we’d see condos tank with all those Air B and B listings coming on the market. Maybe the $2000 monthly checks that our Chinese apologist PM quietly slipped foreign students is keeping them paying their mortages.

#42 SHANE GALLANT on 08.26.20 at 5:45 pm

Garth, how do you think the cottages prices will do north of the GTA this fall?

#43 Brian Ripley on 08.26.20 at 5:52 pm

“…the number of deadbeats has actually increased over the summer…Curb your FOMO.” Garth

My Single Family Detached chart of Y/Y price momentum for Vancouver, Calgary & Toronto Single Family Detached Prices and the TSX Real Estate Index:

http://www.chpc.biz/housing-price-momentum.html

Physical real estate buyers are still betting on price appreciation while cash buyers (the TSX Real Estate Index) has remained in plungeville on the last 4 negative prints of 20% below the flat line.

Back in 1Q 2007 the TSX Real Estate Index plunged with the global troubles and 18 months later on this Y/Y momentum chart, investor momentum found itself at the Get Me Out level (down 40% Y/Y).

#44 XYABC on 08.26.20 at 5:53 pm

And there’s already evidence of the impact on real estate, as condo listings explode, inventory builds and prices start to erode.

What if the condo owners decide to reduce supply by criminal means, such as doing a nine eleven false flag to justify a war in the middle of the Asian mountains?

#45 KNOW IT ALL on 08.26.20 at 5:55 pm

‘Only when the tide goes out will we discover who is swimming naked’

W.B

#46 paulo on 08.26.20 at 5:57 pm

#18 Linda

You bet it will effect your personal residence exemption:
you are conducting commercial business and dont think for one minute the cra is not being appraised on whom has been issued permits to operate the bnb.

Fact of the matter is that this overnite hosting nonsense facilitated one of the largest tax evasion and tax fraud scams ever committed in this country. the game was simple 1) purchase a property and short term host it for 14 months with all utilities bills in your name etc, meeting the cra’s test for claiming personal residence, after reaping the income from hosting in most cases not declared, sell the residence and claim it as a personal residence thous committing a second fraud a game that has been played by many . the cra had figured it out but the covid thing took there attention off tracing these buggers but there day is coming.
.

#47 crossbordershopper on 08.26.20 at 6:05 pm

still trying to figure out who people are talking to to get a mortgage, i got turned down for a 1000 canadian tire credit card, and people talk about 5% down on investment property at 1.5% idk.
maybe we live in two different Canada. i owe nothing to no one probably because I pay cash, because well no one lends me any money. i think this debt thing is a scam
low interest rates, high prices, go ahead and play your games, i will just buy what i need with cash .

#48 espressobob on 08.26.20 at 6:19 pm

Prefs are what you buy when taking profit off common stocks indices.

What’s old and unloved can prove to be loved again.

Timing an asset class is tougher than it seems.

#49 T-Rev on 08.26.20 at 6:26 pm

Ok blog dogs- what’s the cheapest money available for a non insured mortgage in Alberta right now? Mines up for renewal early 2022, and the early break penalty is less than the savings of refinancing so long as the rates are less than 2.02 for a fiver. I’ve already found some for 1.79, who’s got better and where from? What’s the best someone’s gotten out of the Big5?? And remember- uninsured. Decades of responsible cash management don’t get me the same low rates as you government insured high ratio gamblers.

#50 GRG on 08.26.20 at 6:30 pm

If the deferral problem is big enough the T2 government, the BoC, CMHC and those well paid Big 5 Bankers will figure out a work-out.

Nobody wants to collapse the housing market, or be stuck with a bunch of foreclosers in a saturated market.

What would they do with them? Airbnb? Ooops…

#51 Dogman01 on 08.26.20 at 7:18 pm

Local news mentioned 21% of Alberta mortgages were deferred.

Wow.

#52 Nonplused on 08.26.20 at 7:19 pm

Oh I forgot about the dividend tax credit. That is another one I expect to see phased out in addition to the capital gains inclusion rate by the Trudeau/Freeland government. And they may raise corporate tax rates.

To whit, they will not tax primary residences because it would be political suicide, raising the HST will be seen as regressive and punishing the poor, and income taxes are already about as high as they can go. They will probably raise income taxes on people in the top bracket but that isn’t going to float the boat. So we have to look at where the most money can be raised without pissing of the bulk of the voters. So capital gains and dividends it will be. Most of the SJW’s will see those being impacted as “rich people who deserve it” and “fair” (because a dollar is a dollar is a dollar), so it is the most politically expedient option. They already went after private corporations and small businesses so there is no more blood to be had there.

The agenda driving this is Trudeau’s plans for huge social spending and green energy policies. I believe this is the real reason Morneau left, not the WE thing. For all his flaws, including being a Liberal, I suspect he can do math and understand economics a little bit. That is why his major accomplishment was to attack private corporations, because if used correctly they did allow people with fluctuating incomes to stay in a lower tax bracket by retaining earnings. Well that is no more, so it’s on to other things.

So as we’ve learned from California now might be a good time to invest in a Generac backup generator and a huge propane tank. Propane stores better than diesel or gasoline and the natural gas pipes are not sized for everyone to try and heat their houses and keep the lights on at 40 below. Trust me I know, I used to design them. What some in the industry call “send out” is just what happens when all the furnaces are running at 100% and no more gas can be consumed, so the temperature in the houses starts to drop. The pipes are sized for that load and no more. In fact in some states it is illegal to hook a standby generator to the natgas for this very reason. So people go with propane. You can walk don’t run to do this, because it takes a number of years to ruin a power grid with solar. And it ain’t cheap. All in it’ll probably cost you $10,000. But it’ll work at night. Not maybe a good option in Quebec if the protestors keep shutting down the railways. But Quebec has lots of hydro so they might not be forced to do solar.

—————————–

So here is a story that might interest the engineers out there but not anyone else, who should skip it. Back in my pipeline design days there was actually real fear of natural gas shortages if you can believe it, and with good cause. But the problem with a gas outage, at least at that time, is that all the pilot lights would go out and the regulators would shut in (safety feature to prevent air getting in the pipes, which is bad), so even after restoring gas service it would be a monumental task to relight all the furnaces and reset all the regulators safely. So we actually had a plan to ask the power companies to use rolling blackouts to reduce gas demand (furnaces won’t run without electricity). We never actually had to use said plan, but we got close a couple of times. Now it is no worry because there is too much gas and most furnaces have electronic ignition. Resetting all the regulators might still be a problem but I am not sure. Most people have no idea how to do that safely.

#53 Garth's son Drake on 08.26.20 at 7:22 pm

Garth, I told you – get the house and create a suite. Income. Cutting living expenses will make you wealthy. And it curbs the AirBnB bs because apparently that is accepted in the new rules. And when you are sick and tired of renting part of your gorgeous home out you just stop doing it once the renters have paid it off for you.

Condos are garbage. Nobody aspires to live in condensed living. And just to make my point clear about how crappy it is:

In Hong Mei House, the two initial patients with coronavirus lived 10 floors apart, but were on the same vertical block of apartments — number seven. Health authorities evacuated residents living in apartments numbered seven on all 30 floors of the building because their toilet discharge pipes were linked.

This is how condos are built. It is worse than a cruise ship for infection.

#54 Stone on 08.26.20 at 7:24 pm

#27 Sara on 08.26.20 at 4:41 pm
Ooops. Hopefully it was obvious I was being sarcastic in my last comment. Nothing wrong with being a renter. Makes a lot of sense these days. It’s time to stop equating renting with being a loser.

———

Why should I care (or you) what landlords think? They’re just jealous that we’re the pinnacles of perfection.

Renters = losers? Nah. When the landlord subsidizes my living accommodations, who’s the loser now?

Oh yeah!

#55 Flop... on 08.26.20 at 7:25 pm

“Jerome Powell is speaking tomorrow. Some are saying he might suggest that they won’t increase rates for 5 years.”

He will never say that.- Garth

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

Stuffed if I know.

Pretty sure I read a Herald Sun article the other day where Australia is expected to sit on .25% or less for the next 3 years following the latest update from the Bank of Australia

Here’s what Aunty had to say on the matter…

M46BC

https://www.abc.net.au/news/2019-08-27/interest-rates-predicted-to-stay-low-economists/11450918

#56 Nonplused on 08.26.20 at 7:30 pm

#13 Mint Julep on 08.26.20 at 3:54 pm
Re: breaking a mortgage. I’m sure you’ve addressed this already in another post, but what if you still have a few years left on your current term? Should you consider it even if it is less than a 2% difference between current rate and advertised? Will breaking a mortgage impact your credit rating? What are the risks?

————————————-

Why would you break your mortgage? The bank will be happy to carry it over to your new house. And no, there is no effect on your credit so long as you pay the break fee.

#57 Flop... on 08.26.20 at 7:40 pm

Didn’t realize the Aunty article had a crust on it.

Here is a recent quote from the head of the Reserve Bank of Australia.

“The Board is committed to do what it can to support jobs, incomes and businesses in Australia. Its actions are keeping funding costs low and assisting with the supply of credit to households and businesses. This accommodative approach will be maintained as long as it is required. The Board will not increase the cash rate target until progress is being made towards full employment and it is confident that inflation will be sustainably within the 2–3 per cent target band.”

I think the 30 year chart ranged from 17.5% down to .25%

Pretty sure growing up my savings in the bank were getting 6-8% from my before and after school jobs.

Ain’t coming back in my lifetime.

Gone, baby, gone…

M46BC

#58 Justin S on 08.26.20 at 7:40 pm

I’m a relatively new investor, so would appreciate input on this question: What is the value of investing in preferred shares yielding 3.75% or so when you can invest in the common shares of the big 5
cdn banks all yielding 4-6% or so? Does it have to do with their preferential treatment in potential bankruptcy situation? If yes, is there any risk in big 5 bank bankruptcies? I would think no – so what’s the value of pref shares?

Thank for the great blog Garth!

#59 Fortunefaded on 08.26.20 at 7:41 pm

So how exactly does one get their hands on these preferred shares? I have An investors edge Account. What should I be buying?

#60 Nonplused on 08.26.20 at 7:42 pm

“Actually invest through an ETF. – Garth”

So I wanted to weigh in on the wisdom of this advice (and it is wise).

A lot of people will jump up and down saying ETF’s flood the market with money, and that if more people were “value investors” stock prices wouldn’t be so darn high. But I don’t think that argument works because we are talking about the same amount of money whether it is in an ETF or some Robinhood trader is throwing it at one stock or another. So the effect on the market would be the same but the Robinhood traders lack diversification.

If you have a large portfolio, I think it makes sense to have some individual stocks, but not large positions. To have even 5% of your portfolio in an individual stock is flirting with danger. But ETF’s allow you to own dozens of stocks without ringing up all those transaction fees. And there is one for every sector if you like to sector-weight.

#61 Yukon Elvis on 08.26.20 at 8:05 pm

#58 Justin S on 08.26.20 at 7:40 pm
I’m a relatively new investor, so would appreciate input on this question: What is the value of investing in preferred shares yielding 3.75% or so when you can invest in the common shares of the big 5
cdn banks all yielding 4-6% or so? Does it have to do with their preferential treatment in potential bankruptcy situation? If yes, is there any risk in big 5 bank bankruptcies? I would think no – so what’s the value of pref shares?

Thank for the great blog Garth!
……………………………………

It has been stated here on this blog many times by Garth and others that the Big5 will not fail or cut their dividends. Fear not.

#62 Rico on 08.26.20 at 8:06 pm

#59
PDC.TO INVESCO CDN DIV INDX ETF
ZPR.TO BMO LADDERED PREFERRED SHARE INDEX ETF
Up a ton today. Not sure if the price will hold.

#63 Arcticfox on 08.26.20 at 8:07 pm

Why do taxes have to be raised at all and overtly tick off top earners. Just keep printing it up, as last few months, targeting have nots to address the escalating populism meme. Ex. If one person has millions and another has nothing, if new $ is created into existence than directed to person with nothing. This is actually debasing the millionaires cash hoard. The wealthy person’s $ is slowly inflated away to redistribute to person with nothing. This slow surreptitious approach would probably offend wealthy persons less than directly targeting them with tax increases. Could this be safest approach for an encumbent and inevitably the allure of ubi?

#64 ImGonnaBeSick on 08.26.20 at 8:10 pm

#52 & #60 Nonplused on 08.26.20 at 7:42 pm

——-

There are $17 trillion dollars in mutual funds… There’s only $4.5T in ETFs… That’s worldwide… The US market itself is worth $30T… The whole ETFs manipulate the market is absurd…

As for the dividend tax credit, I would think they would need to change some conventions on double taxation to mess with that.

#65 leebow on 08.26.20 at 8:17 pm

#53 Garth’s son Drake

Why do you think Garth got such a big house? He lives in the west wing and rents out the rest. During the long winter nights he listens to the Andante from Shostakovich’s 2nd piano concert together with his tenants and Bandit (The Sergeant-at-Arms).

#66 Kat on 08.26.20 at 8:17 pm

It isn’t enforced in vancity so I doubt it will be there either. So not much to worry about. Personally I dont understand why it isn’t banned, they go against bylaws made for a reason.

#67 Nonplused on 08.26.20 at 8:19 pm

#64 ImGonnaBeSick on 08.26.20 at 8:10 pm
#52 & #60 Nonplused on 08.26.20 at 7:42 pm

——-

There are $17 trillion dollars in mutual funds… There’s only $4.5T in ETFs… That’s worldwide… The US market itself is worth $30T… The whole ETFs manipulate the market is absurd…

As for the dividend tax credit, I would think they would need to change some conventions on double taxation to mess with that.

————————–

Everything that isn’t income tax is a double tax.

#68 AR on 08.26.20 at 8:25 pm

Would it make sense to borrow a few hundred thousand against a paid off home at 1.5% and invest in Preferreds at 5% and write off the mortgage expense?

#69 Captain Uppa on 08.26.20 at 8:28 pm

I check HouseSigma daily.

Even through the past 5 or 6 years of RE price craziness in the GTA, my jaw never dropped until today.

Just pure insanity.

#70 mike from mtl on 08.26.20 at 8:35 pm

RE: AirBNB, good – they deserve a smack.

Perfs, yeah that sounds like a cheap way to attract cheap debt, recall old high issues at initial offer price. To then probably reissue new ones at now rock bottom 5-year. Banks are many things, stupid is not one of them.

I am waiting for 9.50 possibly 10$ ZPR before dumping them. Last five years total return I would have been better in cash – no taxes on that!

#71 Ace Goodheart on 08.26.20 at 8:58 pm

I’ve done quite well buying Husky Energy preferreds.

Would not touch the common stock with a barge pole.

Preferreds however have been consistently making me money.

They cost $6.97 right now with a very nice dividend.

Par value is of course $25.00

Should things improve in the oil patch (inevitable really- oil still has value whether we like to admit it or not) these preferreds will double in value and then some.

And you get to collect the dividend while you wait.

#72 Dave on 08.26.20 at 9:15 pm

A few news articles on BOC thinking about changing how interest rates are set.

People don’t feel 2% inflation but a lot more.

Is there something to this? Increase rates?

#73 Apocalypse2020 on 08.26.20 at 9:32 pm

70 Days to Global Catastrophe.

PREPARE

#74 El presidente on 08.26.20 at 9:43 pm

Melania is getting a billion or two to hang in there….

#75 crowdedelevatorfartz on 08.26.20 at 9:55 pm

Ahhhh.
Just when you thought BC Realtors couldnt get any worse……..

https://www.wellandtribune.ca/ts/news/canada/2020/08/24/who-does-this-bc-realtor-accused-of-snatching-fruit-from-garden-during-house-tour.html

Apparently the egregious fees they charge just aren’t enough to pay the bills.

#76 kommykim on 08.26.20 at 10:26 pm

RE: #58 Justin S on 08.26.20 at 7:40 pm
I’m a relatively new investor, so would appreciate input on this question: What is the value of investing in preferred shares yielding 3.75% or so when you can invest in the common shares of the big 5
cdn banks all yielding 4-6% or so?

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

Those shares will yield a bit more than 3.75% if you can buy them below par value. ie: a pref issued at $25 and yielding $0.9375 per annum (3.75%) might be selling on the market for $17 per share and thus effectively yield 5.5%. And, if what Garth mentioned about RBC happens and the issuer calls the shares on their anniversary date, then they are obligated to pay you out at $25 per share. You buy prefs for the income stream without having to “worry” about share price, but you’re right, the banks are a pretty good bet anyway.

#77 TurnerNation on 08.26.20 at 10:29 pm

#22 Dolce Vita look at only the photos in this predictive programming err I mean ‘news’ article. Straight out of a medieval dungeon chamber.

https://www.cbc.ca/radio/asithappens/as-it-happens-friday-edition-1.5695035/choir-director-invents-performer-s-face-mask-for-safe-singing-1.5695376

This is the New System, a slave system, submit. And the children back to school is straight out of prison.
All designed to disrupt our feeding, movement and especially breeding. Our farmers control this.
People willingly gave up their rights for the new global religion, CV. I don’t need them – I’ve already separated the wheat from the tare so to speak.

#78 Dr V on 08.26.20 at 10:29 pm

Nonplused – just google “why is there a dividend tax
credit?” It basically just equates the pre-tax corporate income to a salary paid to the business owner. The owner (shareholder) is given a credit for the tax that gets paid by the corp. I thought you would have understood this.

so if CIBC wants to skip the corp tax, just pay me the pretax profit as a wage which they can write off as an
expense, and I get no credit. Same result.

A refresher

https://www.moneysense.ca/save/retirement/delectable-dividends/

“The government recognizes that it’s unfair to tax the same income twice. So they give you a break on dividend taxes to offset the taxes the corporation already paid. As a result, you should pay roughly the same tax as if the income had come straight to you in the first place, without passing through corporate hands.”

so I don’t see dividends on the table. Well, maybe if you make $1M pa from them, but the more likely way is to simply raise the income and corp tax rate. Too many small-timers and retirees receive dividends to screw with them.

#79 Devil's advocate on 08.27.20 at 12:24 am

#27 Sara on 08.26.20 at 4:41 pm

Ooops. Hopefully it was obvious I was being sarcastic in my last comment. Nothing wrong with being a renter. Makes a lot of sense these days. It’s time to stop equating renting with being a loser.

————————————————-

Too late, Sara. I already read your (sarcasm off) post! I’ll never treat them the same again … thanks to you.

#80 Rob Reynolds on 08.27.20 at 1:30 am

How long can you get a mortgage rate guarantee for these days? 90 days? 120? Longer?

Wondering if it makes any sense to get pre-approved now, when things are still “relatively” good.

Then in the fall when Mortgage deferral cliff hits, and in the new year when foreclosures start, having a pre-approved mortgage with a low rate might be a benefit.

#81 Bento Box on 08.27.20 at 5:47 am

If I look at building an investment portfolio over a twenty to thirty year time frame , it’s easy to look at management , balance sheet and potential rather than yesterday’s news. Meanwhile the issues that are on sale now, prefs, REITs, it’s etc are all screaming buys. I don’t sell anything to rebalance, instead I use dividends to top up issues that lag rather than sell what’s up. Investment efficiency and no tax rocks. But buy buy, and sleep gooooooood.

#82 Groover Stone on 08.27.20 at 7:07 am

DELETED

#83 Stan Brooks Psychiatrist on 08.27.20 at 8:09 am

#168 Stan Brooks on 08.26.20 at 3:02 pm

Watching in real time the destruction of the ‘loonie’ is surreal, but fulfilling.

What kind of idiots can trust the socks boy and his ‘green’ finance minister is beyond me but it is kind of funny to watch the exceptionally stupid lead by 2 dummkopfs with combined IQ 1/3 of mine.
—————————————————————-
What destruction of the loonie Stanley? The loonie is holding nicely against the US dollar. As for the 2 dummkopfs having a combined IQ 1/3 of yours, you are confusing your IQ of 90 as being high. I told you many times during our sessions how IQ numbers work and a 100 IQ is not a perfect IQ as you keep insisting. You are embarrassing yourself Stanley…

#84 Wrk.dover on 08.27.20 at 8:10 am

Perusing the NSLC site, I see 15>25% booze price increases across the board. No corresponding press release when I googled though.

So this won’t show up as CPI increase I suppose.

$4.00 for a tall can of beer!!!!

I wonder if this is a provincial or fed excise increase, and if the other is yet to follow.

I called hoarding these products as an investment on this site months ago.

#85 MikefromCorbeil on 08.27.20 at 8:15 am

Would it make sense to borrow a few hundred thousand against a paid off home at 1.5% and invest in Preferreds at 5% and write off the mortgage expense?

I have been thinking of doing the same..but I am too
chicken…t

#86 crowdedelevatorfartz on 08.27.20 at 8:16 am

@#73 Apocalypse 2020

Every time you pop up I’m reminded of a ground hog.
I hear its going to be a bad winter……..

#87 Book of Ecclesiastes on 08.27.20 at 8:18 am

#162 YouKnowWho on 08.26.20 at 2:10 pm
TurnerNation

“Hilarious that people pay $2m for a leasehold on the Queen’s land and think they own it…just to keep a box to store all their crap in. When broken down to basics it’s silly and so is the pursuit. Spend your life in debt to have a box for your clothes, collection of comics and whatever other nonsense is keep in the garage where a car should go. Then weap about the tragedy of death when you dedicated your life to worship of money or real estate.

Well done. Reflect about this success on the death bed. Think how much of your life that detached house ate up. Wish you had it back now, don’t you? Can’t.
—————————————————————–
Ecclesiastes 1:2-3

2 Vanity of vanities, says the Preacher,
vanity of vanities! All is vanity.
3 What does man gain by all the toil
at which he toils under the sun?

#88 Justin S on 08.27.20 at 8:46 am

#61 Yukon Elvis on 08.26.20 at 8:05 pm

#76 kommykim on 08.26.20 at 10:26 pm

Thank you both for the responses. Much appreciated.

#89 ImGonnaBeSick on 08.27.20 at 9:06 am

#67 Nonplused on 08.26.20 at 8:19 pm
#64 ImGonnaBeSick on 08.26.20 at 8:10 pm
#52 & #60 Nonplused on 08.26.20 at 7:42 pm

——-

There are $17 trillion dollars in mutual funds… There’s only $4.5T in ETFs… That’s worldwide… The US market itself is worth $30T… The whole ETFs manipulate the market is absurd…

As for the dividend tax credit, I would think they would need to change some conventions on double taxation to mess with that.

————————–

Everything that isn’t income tax is a double tax

——-

Good point

#90 TurnerNation on 08.27.20 at 9:12 am

The Second Wave – of Bankruptcies – is here. In the food industry. The tape of the is here, scroll down for closed/shuttered:

https://www.blogto.com/eat_drink/

I’ll say it again – in a ‘pandemic’ I expect long lines at walk in clinics and ER rooms, with them begging only essential visits be made. Sure a blog dog (or two did, I think) will tell us their neighbour died, and I get that. But based on the *media fear level* that single person should have infected dozens, hundreds. Entire families wiped out as doctors throw up their hands at this ‘novel disease’. Funeral plots should be selling out as houses are , bidding wars even. Streets continually shut down for the never-ending stream of hearses. That’s a pandemic. I have networks of hundreds spanning diverse groups, as do many others. This is not what’s happening. Sure they will tell us ‘we caught it in time’ – then it’s not a pandemic is it.

Early on only well known Celebrities, Influencers, Pro athletes and Politicians got it. Made us all aware for much social media traffic. All made 100% recoveries if at all.

Monkey see, monkey do.

But hey if you wish to give up your rights that’s your business. It’s not the flu!!
https://en.wikipedia.org/wiki/Coronavirus
Coronaviruses are a group of related RNA viruses that cause diseases in mammals and birds. In humans and birds, they cause respiratory tract infections that can range from mild to lethal. Mild illnesses in humans include some cases of the common cold (which is also caused by other viruses, predominantly rhinoviruses), while more lethal varieties can cause SARS, MERS, and COVID-19

#91 crowdedelevatorfartz on 08.27.20 at 9:21 am

87 Book of Riddles

I hear Jimmy Falwell Jr is getting $10.5 million “severance” from Bible U to leave with his cuckolding wife….

Any zippy biblical quotes for Cabana Boys?

#92 Do we have all the facts on 08.27.20 at 9:25 am

In 2002 investors could choose from 110 US based exchange traded funds with a total net asset value of only $102 billion.

By 2020 investors could choose from 2,100 US based ETF with a total net asset value of $4.4 trillion.

While the total net asset value of US based ETF is significantly lower than the $21 trillion held within 8,000 mutual funds in 2019 the gap is shrinking.

Each time a new ETF is created it results in the purchase of assets on the open market. The purchase of assets by a new ETF maintains, or increases, the value of assets held within existing ETF. With interest rates of many fixed income vehicles at an all time low thousands of new investors have decided to invest in equity based ETF. In essence the creation of new equity based ETF by financial institutions, including the pooling of several existing ETF into a separate fund, increases the demand for equities and increases their extrinsic value.

Close to 50% of the $25.4 trillion invested in US based mutual funds and ETF in 2020 is based on equities. As long as new investment capital continues to increase each year the current rates of return on equities held within a mutual fund or an ETF can be maintained.

It appears as if the extrinsic value of equities based on the influx of new investment capital looking for a better rate of return has become far more important than the intrinsic value of equities based on profitability.

This is not substantially different from the belief that the purchase of a home as an investment will increase in value in perpetuity because it has in the recent past.

As long as demand for any asset remains strong the extrinsic value will increase. When demand is reduced for a variety of reasons the gap between the extrinsic value of an asset and the intrinsic value of an asset will shrink. This is why a balanced and diverse portfolio is recommended.

Change is an inevitable reality that history offers to all investors free of charge.

There is always risk in allowing the past to define your future!

#93 Sara on 08.27.20 at 9:47 am

#91 CEF ” I hear Jimmy Falwell Jr is getting $10.5 million “severance” from Bible U to leave with his cuckolding wife….”

Is it “cuckolding” if the husband participates like Jimmy did?

#94 Dharma Bum on 08.27.20 at 10:20 am

Yes, preferred share prices blossomed the other day.

Meh.

I purchase and hold them for the dividend income anyway.

The only thing better, would have been to have bought them all (or bought more of them) when they initially tanked. But, we are not market timers here, right?

Listen to Garth, dogs. Never exit an asset class.

Preferred shares should have a place in your balanced and diversified portfolio. Stop denying it.

https://www.thekickassentrepreneur.com/are-preferred-shares-an-asset-you-should-consider-holding-in-your-portfolio/

#95 TurnerNation on 08.27.20 at 10:25 am

They’re not even hiding it. We are cattle to our elite rulers. Tracked and our movements, feeding and especially breeding is being controlled. Hence the push for our DNA (swabs or mail it in)
Yep CV did this. People will not protest, we need our employment – as DEBT slaves:

A COLLAR worn around the neck! All to ‘keep us safe’.
“The Truth is no longer hidden, people are hiding from the truth”. This is total prison planet, look my grandparents fought a good ground war in WW2 – and won it – but overall we lost. Ask our German Royal Family which changes their name to Windsor. Their mug graces our coinage.

“Employees are assigned a dedicated wearable device, that can be worn as a bracelet, around the neck or in their pocket, for COVID-19 contact tracing.”

https://mms.businesswire.com/media/20200827005271/en/816267/4/TraceSCAN_Wearable.jpg

Facedrive Inc. (“Facedrive”) (TSXV: FD), Canada’s “people-and-planet first” business and leading tech developer, is pleased to announce that its contact tracing solution, TraceSCAN (http://www.tracescan.ca/), has received media coverage in support of innovative use of wearable technologies for managing COVID-19 at construction sites in Ontario.

#96 JB CONDO DEATH on 08.27.20 at 10:30 am

#26 Sara on 08.26.20 at 4:36 pm

#18 JBCondoDeath “The end of the investment CONDO HELL as we know it. They will all be turned into a RENTAL HELL. Same old same the owners that legitimately lived in these places now have to deal with Renters. Depressing really. ”

Yeah because renters are low-lives (sarcasm off).
#27 Sara on 08.26.20 at 4:41 pm

Ooops. Hopefully it was obvious I was being sarcastic in my last comment. Nothing wrong with being a renter. Makes a lot of sense these days. It’s time to stop equating renting with being a loser.
………………………………………………………………
Been there and done that with a CONDO. It was filled with renters that simply did not give a $hit about the aesthetics of the complex and pretty much ignored every rule. You cannot understand the significance of owning something and taking care of it unless you actually own it. Most renters simply just use and abuse property with the sentiment that it will be taken care of by someone else and it’s not their problem. Would you purchase a used rental vehicle?

#97 ImGonnaBeSick on 08.27.20 at 10:30 am

#92 Do we have all the facts on 08.27.20 at 9:25 am

—–

You usually make good arguments, but I think comparing the ETF purchasing with real estate is a bit of an over reach here. Your argument may work with the average Canadian that knows nothing of either, but you are ignoring liquidity, low transaction fees, quantity of buyers/sellers, underlying assets’ ability to generate earnings, digital asset vs large physical asset, comparatively low price, low leverage for average investor, essentially no maintenance costs, and that’s just off the top of my head. They are not the same, because an ETF is not the actual thing you are buying. It is a basket of underlying stocks, which are all able to be traded individually, and generate revenue individually.

I’m just a hobbyist, an actual professional, could easily pick apart your position on this one.

#98 NotLegalAdvice on 08.27.20 at 10:34 am

What’s the best 10 year anyone has locked into with the Big 6?

#99 crowdedelevatorfartz on 08.27.20 at 10:34 am

@#93 Sara

apparently….. :)

https://news.yahoo.com/cuckolding-meaning-fetish-sex-term-184100030.html

#100 Re elect NO ONE on 08.27.20 at 10:45 am

“Here’s the narrative:

A deadly new virus is discovered…there’s no treatment or cure…it’s highly contagious…everyone is a potential victim…the world is at risk from asymptomatic super spreaders…new clusters of cases reported daily…

Everyone must get tested even though the tests are unreliable…positive antibody tests are called “infections” and “cases” even when the patient has no symptoms…every politician gets involved…media hysteria in high gear…activists demand salvation from government and Big Pharma…

Billions of dollars are authorized for fast track drug and vaccine research…simple, effective remedies are rejected while expensive, dangerous ones are pushed……presumptive diagnoses…exaggerated death statistics…falsified death certificates…

Covid 2020?

No. HIV=AIDS in the 1980s”

https://kenmccarthy.com/blog/digging-deep-into-the-covid-con

#101 45north on 08.27.20 at 11:06 am

Bill

Yes I installed the 1st Nortel CDMA base stations on earth in Burnaby way back. They were $250k. An Huawei site about $35k. CCP had a plan to destroy NT and deploy the massive subsidized equip…theres no environment over there, slave labor. Nortel also got stupid and lazy. Sad 100k of Canadian jobs down the tube.
Huawei needs the boot and its happening.
Our gov has pandered to them for years. Maybe we need a new flag.

yep but what’s wrong with the flag we got?

#102 How stupid are you? on 08.27.20 at 11:14 am

DELETED

#103 Captain Uppa on 08.27.20 at 11:36 am

Time to inflate the debt away!

#104 Sara on 08.27.20 at 11:43 am

@ #99 CEF

Interesting. So I guess with regard to Jimmy and spouse, rather than use the term “cuckolding wife” — which implies secrecy and betrayal — we should refer to them as a “cuckolding couple.”

#105 Yukon Elvis on 08.27.20 at 11:56 am

#94 Dharma Bum on 08.27.20 at 10:20 am
Yes, preferred share prices blossomed the other day.

Meh.

I purchase and hold them for the dividend income anyway.

The only thing better, would have been to have bought them all (or bought more of them) when they initially tanked. But, we are not market timers here, right?
………………………………….

Re: market timing. The buy signal was in late March/early April when the market tanked. For example you could have bought CIBC for $70ish bucks . Today it is $103. And yes, I did buy some.

#106 Damifino on 08.27.20 at 12:05 pm

#96 JB CONDO DEATH

Most renters simply just use and abuse property with the sentiment that it will be taken care of by someone else and it’s not their problem.
————————————–

UNLESS, of course, those renters live in a lower density yet higher end purpose-built place with professional management, careful vetting and high security.

In that case, the tenants will actually get something for their (yes, higher) rent while freeing themselves from the typical problems of ownership.

Those problems then become someone else’s actual business along with the motivation to care for and protect their investment.

Then, tenants are free to get on with their own business, part of which should include sensible investment of the vast carrying costs of ownership saved as a result.

#107 TRUMP2020 on 08.27.20 at 12:17 pm

LOW RATES FOR YEARS…. says the FEDS.

So when do I put my house up for sale for top dollar?
Maybe I should wait another month or 2??

#108 Do we have all the facts on 08.27.20 at 12:24 pm

#97

I think you missed my main point that the extrinsic value of any asset be it an individual stock, a mutual fund, an ETF or dwelling unit is driven demand. The increase in demand for many assets seems to be based the historical rates of return on investment not on the intrinsic value of the asset.

The current demand for equity based ETF is not based on the profitability of the basket of assets but on a a belief that the assets within an ETF will continue to increase in value over time.

I wasn’t comparing an investment in equities to anything. I was only pointing out that a considerable portion of the increase in the extrinsic value of equities is driven by increased demand and that demand may decline for any number of reasons.

The purchase of trillions of dollars of equities by financial institutions such as Blackrock has contributed to an increase in their extrinsic value and the rates of return on
realized through investment in equities. This has stimulated a demand that has become disconnected from the intrinsic value of many equities.

A reduction in demand will affect the value of all assets including equities and real estate.

Balance and diversity will minimize the impact of changing demand.

#109 Ah steerage.... on 08.27.20 at 12:30 pm

#104 Sara on 08.27.20 at 11:43 am

@ #99 CEF

Interesting. So I guess with regard to Jimmy and spouse, rather than use the term “cuckolding wife” — which implies secrecy and betrayal — we should refer to them as a “cuckolding couple.”
..

I’m thinking mainlining some clorox is needed….

#110 MF on 08.27.20 at 1:20 pm

100 Re elect NO ONE on 08.27.20 at 10

Nope.

AIDS has ravaged the lives of millions around the world. Like covid it was completely politicized and labelled a homosexual disease, which slowed research and funding for treatment. It was only until that changed due to extensive lobbying, shifting societal norms, and the growing impact of the virus (when we realized it impacted heterosexual individuals as well) that treatments were developed and knowledge was gained.

Since 2004 aids related deaths have been declining, as therapies and treatment become more effective:

https://www.unaids.org/en/resources/fact-sheet

There are parallels to Covid, only the complete opposite of what you are saying. AIDS showed the world that politicizing a health crisis makes it worse, and that taking it seriously, and throwing resources at it work at developing treatment.

It also showed us all to completely ignore all the conspiracies, and that the people who forward that kind of trash (like you are doing here) have their own agenda.

MF

#111 SoggyShorts on 08.27.20 at 1:22 pm

#94 Dharma Bum on 08.27.20 at 10:20 am

Preferred shares should have a place in your balanced and diversified portfolio. Stop denying it.

************************
I get that it’s all about the dividends, but I just can’t ignore the total return picture.
CPD is up 8% on a total return basis since inception over 10 years ago vs VOO at 265%.

So to counter this the idea is to buy and hold forever I guess? That or market timing? I feel like it’s a trap: Yes, you get 5% annual dividends, but no more, and if you ever want out you’re going to take a loss.

I really like the sound of (almost) guaranteed 5% dividends, but with a potentially 50y long retirement just over the horizon I need better. If it’s not going to be an equity that actually goes up 7%+ on average then I need it to at least be negatively correlated with those that do.

#112 MF on 08.27.20 at 1:24 pm

97 ImGonnaBeSick on 08.27.20 at 10

“You usually make good arguments”.

-Not really. Most of that posters arguments have holes the size of the one in the ozone layer in 1995.

Long posts =\ always equal anything useful.

MF

#113 Dee on 08.27.20 at 4:11 pm

Ok we let me get this straight- teachers generally making 6 figures, 3 months off+ sweet pension(globally, one of the best teaching gigs) Ford has called the union out on not stepping up, still no good. Mr.T jumps in and offers 2 bil, most of which lands in Ont.

All is good now :)

#114 David Greene on 08.28.20 at 12:27 am

Nonsense. While it may in fact be true, how prevalent is this phenomenon? We’ve heard of one occurrence. ONE. To quote a meme that goes around scientific/tech. websites, the plural of anecdotes is not “data”.

Garth’s son Drake on 08.26.20 at 7:22 pm

Garth, I told you – get the house and create a suite. Income. Cutting living expenses will make you wealthy. And it curbs the AirBnB bs because apparently that is accepted in the new rules. And when you are sick and tired of renting part of your gorgeous home out you just stop doing it once the renters have paid it off for you.

Condos are garbage. Nobody aspires to live in condensed living. And just to make my point clear about how crappy it is:

In Hong Mei House, the two initial patients with coronavirus lived 10 floors apart, but were on the same vertical block of apartments — number seven. Health authorities evacuated residents living in apartments numbered seven on all 30 floors of the building because their toilet discharge pipes were linked.

This is how condos are built. It is worse than a cruise ship for infection.