Freeconomics

In 1993 I completely lost it and ran for the leadership of the federal Progressive Conservative party. That’s back when being a Con meant you worried more about finances than diddling. Socially liberal. Fiscally conservative. Worked for me.

Well, there was a big convention in Ottawa. Ten thousand people. And while my chances of winning were zero (Kim had it nailed) it was an opportunity to make a statement. So I did. After sweet-talking the Vancouver Board of Trade, they gave me their debt clock. I hauled that sucker to the nation’s capital and installed it in the lobby of the convention center, where it ticked ominously over the heads of delegates.

You know the rest. The PCs were annihilated in the next election. I lost my seat. The Chretien Libs kept the GST and finance minister Paul Martin attacked the deficit. In 1998 the debt clock was retired when the federal budget was balanced. And while I was not directly part of that effort, it felt close. Paul called me one day to say so. Classy.

My, oh, my. How things have changed. The national debt in 1993 was about $600 billion. By the time the credit crisis hit in 2008, it was down to $500 billion. Then the wheels came off. Since then nobody talks about the debt. Nobody cares. Now it’s $1 trillion. The Trudeau team is adding about $340 billion this year alone, and we’re apparently about to embark on a spending spree of Biblical proportions.

Capital Economics is calling it “Freeconomics” and the new architect is Chrystia. Now untethered to the pedantic pinstriped gray-hued Bay Streeter Bill Morneau, our prime minister is about to go nuts. Covid has morphed from a disaster into an “opportunity”, he says. The country’s about to get the kind of green new deal that Freeland was promoting just before being elected in 2013.

Say the economists:

New Finance Minister Chrystia Freeland has already shown her colours by ramping up fiscal spending after just one day on the job, and her previous calls for a “new New Deal” to address inequality suggest she may soon push for even greater spending. The opinion polls imply most Canadians would support this more activist approach and, despite record debt issuance already this year, the government can still essentially borrow for free in real terms. All this means the stage is set for sustained deficit spending in the years ahead, which could cause GDP growth to be higher than we currently assume.

Does any of this matter, except to paleo guys like me?

Nah. And T2 knows it. With interest rates in the ditch thanks to the virus, the Bank of Canada can push a few buttons, create billions more and fuel unfettered government spending. Of course all this money has to be backed by something, which will be a new mess of government bonds and (naturally) more tax revenues to service the debt.

Most recently Freeconomics has delivered another $37 billion in spending as CERB morphs into an expanded EI campaign. But unemployment is still over 10% nationally and expected to remain at elevated levels for months to come. So expect more income support payments. Then there are the hundreds of thousands of mortgage deferrals which will cease this autumn. The banks are reporting that between 12% and 18% of all home loans are not being serviced. So what happens when the clock runs out? Meanwhile businesses are hurting, and corporate tax revenues are falling along with revenues, which are down almost 12%.

Not that you care (I bet), but our debt is now equal to 50% of the economy. If we have another three or four years like 2020 in terms of federal deficits, that ratio will be 100%. (By the way, when provincial government debt is added we’re already at about 90%. And did you see the latest Alberta number? Ugh. Brutal.)

Is this sustainable?

If interest rates stay where they are, people get back to work, the economy reopens fully, businesses regain profits and the GDP swells, then we’re okay. But that won’t last. More economic growth brings expansion, wage pressures, rising prices and inflation. That means higher rates. Always. So the more debt that’s racked up now – even if it can be serviced handily  for a few years – locks in future generations to epic payments. When I hauled that debt clock across the country the feds were hobbled by handing over a third of all taxes collected in interest payments alone. Could happen again. Tell your kids.

Will the cost of money stay lower forever? Lots of people come here to say it will. They desperately need it to be so, for their own pooched finances. But it’s a gamble. The odds of losing the bet are high.

Soon the Freeconomics new deal will be here. Sources say Trudeau wants ‘to go big’.  He now has a willing, supportive sidekick in control of the purse strings. Will the majority of people even care? Or have we become a nation of people comfortable with endless debt and free cash flow?

Don’t bother. I know the answer.

Next week we’ll discuss how to prepare.

178 comments ↓

#1 JB CONDO DEATH on 08.27.20 at 1:36 pm

#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.
………………………………………………………………..
Ya sure been in the higher end type its all the same.

#2 NotLegalAdvice on 08.27.20 at 1:42 pm

10 year fixed NON insured mortgage for 2.59 from a Big 6 bank – is it worth taking this over the 5 year 1.99 rate? Remember NON INSURED! Thanks for answering.

#3 Masks really do make some people more attractive on 08.27.20 at 1:42 pm

Isn’t Alberta doing the opposite of the Libs? Cutting programs, lowering taxes, paying public servants less, getting rid of expensive doctors, favouring the O and G industry?

We have a rare opportunity to see which of these politically divergent approaches produces the better result. Although it seems that many doctors aren’t waiting around to see how this turns out, much to BC’s delight.

#4 Captain Uppa on 08.27.20 at 1:46 pm

My wife is frugal without being cheap and hates debt. Though we obviously hold debt (home and car), she reigns in our temptations to spend while our friends buy all kinds of toys with cheap money.

She’s on a mission to reduce what debt we currently have. So as any happily married man here knows, I better comply. Lucky me.

#5 Jeff on 08.27.20 at 1:48 pm

Fiscal conservatism in a democracy is impossible. This could be the big refutation that’s needed to finally wake up all these palooka conservatives.

#6 Typo Obsessed on 08.27.20 at 1:50 pm

Most recently Feeconomics….
More economic growth beings expansion…

#7 Barb on 08.27.20 at 2:02 pm

These people are stone-cold Marxists. They will bankrupt Canada into the new Venezuela. They don’t care about Canada, they care about their own absolute power, and absolute power corrupts absolutely. The outrageous corruption will continue with these power lusting clowns in charge.

#8 mattbg on 08.27.20 at 2:06 pm

It’s really strange what’s happened with conversations about fiscal prudence and federal debt.

Even talking to people who are fiscally conservative in their own lives, and are concerned about things like the impact of climate change on future generations, seem not to be worried about piling on federal debt and what it means in future. A decade ago, these people would have been concerned. Some of the thinking is that, as long as everyone is doing it, there is no concern. There’s some logic to that, but still…

The best line I’ve heard is: “That’s not my money – that’s the government’s money!”

My reading of the situation is that we’ve just become emboldened by the fact that inflation did not arrive after all the borrowing and QE in 2008 and will keep pushing until something breaks. People expect that of those in charge.

Strange, because the price of stocks and housing shows you how much people think our money is really worth.

#9 The West on 08.27.20 at 2:11 pm

Greater Fool – the troubled future of financial capitalism.

#10 Steven Rowlandson on 08.27.20 at 2:11 pm

Garth did you ever read the book Death by deficit by Major General Richard Rohmer ?

https://www.debtclock.ca/ Ominous indeed is it not?

#11 Comrade on 08.27.20 at 2:14 pm

Mark Carney takes a job with Brookfield Asset Management, who have sizable investment in renewable energy sector. Coincidence, or not with the government’s announcement in spending in green projects. I think this may be telling where the money is.

Interesting times, will liberals create a better, greener, and more equal world for future generations, or five years from now we will be scratching our heads trying to figure out how to undig ourselves out of the hole they created, with nothing to show for.

#12 Friedman’s Ghost on 08.27.20 at 2:14 pm

Although the system has it flaws, less government, less taxes, and increased privatization is the answer to ensure basic public freedoms and fair market pricing. Almost all cases of government interference result in stagnant innovation, a greater division between rich and poor, and an increase in monopolies/oligopolies.

The smallest thought that one would think the government is best positioned to make lifestyle choices for you and for the populace in which one lives, garners much concern and it reflects upon ones thoughts regarding social liberties.

#13 Ponzius Pilatus on 08.27.20 at 2:18 pm

“Freeconomics”
Time for another bestseller, Garth.

#14 Polecat on 08.27.20 at 2:21 pm

Crap…time to start looking at off grid situation.

#15 The Woosh on 08.27.20 at 2:22 pm

But unemployment is still over 10% nationally and expected to remain at elevated levels for months to come.

————————————————

Looks like a typo to me….”months” should Be “years”. Don’t kid yourselves. Real unemployment will be high for years to come.

#16 Millennial Realist on 08.27.20 at 2:22 pm

Paleo Boomer Cons – change is coming!

Bigly.

Be part of the change.

Or be run over by it.

#17 crowdedelevatorfartz on 08.27.20 at 2:24 pm

I was thinking the other day we need the debt clock back. In every major Canadian city.
Showing Canada’s debt.
The tax liability for every person.
Etc.
I remember the one in downtown Vancouver.
People would just stop and stare at it.
Speechless.

Time for a new one before Trudeau calls another election?
Go fund me a “Debt Clock?

#18 Dave on 08.27.20 at 2:27 pm

If interest rates are dropping…why not increase stress test.

Cheap money that keep housing balanced???

#19 NSNG on 08.27.20 at 2:33 pm

#5 Jeff on 08.27.20 at 1:48 pm

Fiscal conservatism in a democracy is impossible. This could be the big refutation that’s needed to finally wake up all these palooka conservatives.

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

The Liberals did it with no problem under Paul Martin as finance minister

It helped that there was a reform party ready to burn their tales.

We just need a few more pitchforks and torches in government.

Sooner or later, everyone becomes a fiscal conservative (because sooner or later no one is stupid enough to lend you money).

#20 cto on 08.27.20 at 2:34 pm

Garth
I consistently come on here and state that rates are going no-where. Not because i need them to stay low, i want them to rise! Purge out the weaknesses, like the speculators, and condo investors.
I was expecting this to happen back in 2011, you and the central bankers said as such, but like being hit by a run away train, i was blindsided and knocked on my ass!
Not only have they not raised rates (in any meaningful way) but they have dropped them even lower and continued there QE.
It will soon be 13 years since they first lowered…and left them there…do you actually think they are going to raise anything out of the ditch, other than housing?

#21 NSNG on 08.27.20 at 2:35 pm

*burn their tails

#22 BillyBob on 08.27.20 at 2:35 pm

I care. I lament the crushing load being so blithely taken on by the next several generations. Debt does matter, even if we’ve gotten expert at passing the buck and embracing the illusion of wealth.

But I will abstain from helping to pay for such tragically poor decisions as much as I possibly can. I suspect many others with money will do the same, which will of course only reinforce the vicious cycle.

You cannot borrow your way to prosperity. Ever.

#23 SunShowers on 08.27.20 at 2:37 pm

“Soon the Freeconomics new deal will be here. Sources say Trudeau wants ‘to go big’. He now has a willing, supportive sidekick in control of the purse strings. Will the majority of people even care? Or have we become a nation of people comfortable with endless debt and free cash flow?”

:)

#24 Paul on 08.27.20 at 2:40 pm

“Next week we’ll discuss how to prepare.”

The way things are going I hope that’s not leaving it to long!

#25 Steven Nicolle on 08.27.20 at 2:40 pm

Yes it will be a spending spree like no other and the NDP will see to it. You wonder how O’Toole will ever gain traction with the under 60 voter. He will have to move left as well or never have a chance. With all these parties moving to the left they should unite and form a new party. “The Left of Center Party” HaHa This way they cannot be called socialist.

#26 ElGatoNerodeYVR on 08.27.20 at 2:40 pm

The green economy failed in Germany however I am sure we can do it better here in Canada, lotusland and all.
As far as borrowing goes it worked for China so why not go big and spend a trillion or so in Infrastructure (fast trains , subway lines, resort towns, new cities for the homeless complete with government sponsored cafeterias ) and military.
One way or the other we will never pay for it and we will get taxed into poverty to support interest payments so may as well be getting something for it.

#27 The Totally Unbiased, Highly Intelligent, Rational Observer on 08.27.20 at 2:42 pm

“In 1993 I completely lost it and ran for the leadership of the federal Progressive Conservative party. That’s back when being a Con meant you worried more about finances than diddling. Socially liberal. Fiscally conservative. Worked for me.” — Garth

Fiscally conservative means that people are concerned about finances.

Socially conservative means that people are concerned about morality.

Of course, ideally people should be both fiscally and socially conservative.

Some people seem to think that they can be fiscally conservative without being socially conservative, but both require self-restraint and self-control.

As the current Canadian Prime Minister Justin Trudeau is showing, when people lack self-restraint and self-control, all forms of responsibility get thrown out.

#28 Andrewski on 08.27.20 at 2:45 pm

Neighbours finally sold their home. The new owners moved in over the weekend & told me they had a tough time qualifying for a mortgage. Both work full time, one in health care & the other in a government job, yet they were to told to up there down payment, thankfully they had TFSA $ to access. To those who’ve (needlessly) deferred their mortgages, that will show up (as a negative) on their credit reports for sure.

#29 Crazy Jim on 08.27.20 at 2:50 pm

There’s a term for what you are describing:

“Financial Repression”

It’s already here.

#30 Some guy on 08.27.20 at 2:53 pm

So heres a theory, the Trudeau government can borrow two buckets:
1. A super large sum for debt to give out like robin hood
2. A large sum to cover future interest payments for that debt for X number of years.

I believe that is the future of Canada.

#31 Overheardyou on 08.27.20 at 2:55 pm

Next week we’ll discuss how to prepare.

———————-

I have never wanted to skip a weekend before, this is such an occasion.

#32 Dirty Dan on 08.27.20 at 3:07 pm

Garth, I think you’re missing the bigger picture with regard to the finance minister.

It isn’t about fiscal responsibility, the future of Canada or this debt you seem to be concerned about.

What we have is bigger than that… we have the first female finance minister, and you can take that to the bank, hahaha.

#33 Don Guillermo on 08.27.20 at 3:11 pm

#11 Comrade on 08.27.20 at 2:14 pm

Interesting times, will liberals create a better, greener, and more equal world for future generations NO

or five years from now we will be scratching our heads trying to figure out how to undig ourselves out of the hole they created, with nothing to show for YES

#34 PBrasseur on 08.27.20 at 3:11 pm

When in a hole stop digging, that’s about the best this country can hope for at this point.

To do more digging T2 needs a new mandate.

#35 Jeremy on 08.27.20 at 3:14 pm

I have already had a couple of tense conversations with my financial advisor about all this.

She is encouraging me to think about liquidating all assets by December 31 at the latest, even this month if possible, and plan for a strategy to offshore all I can to avoid what she thinks will be massive tax increases.

Never heard this level of fear before.

Get a new advisor. – Garth

#36 crowdedelevatorfartz on 08.27.20 at 3:14 pm

@#16 Millenial Denialist
“Be part of the change.
Or be run over by it.”

++++
Apparently you (like the majority of your cohort) weren’t paying attention when “deficit” and “debt” were being discussed.

Not to worry.

The cold cruel reality of massive personal tax increase will explain it to you.

:)

#37 Dolce Vita on 08.27.20 at 3:16 pm

“Will the majority of people even care?”

No. He got re-elected.

“Or have we become a nation of people comfortable with endless debt and free cash flow?”

Yes. He got re-elected.

The NEW Canada*:

Give us free money and we’re cool with no ethics, sole source contracts to your buddies and family, Black Face and all.

————————————-

*At least the Mafia is up front.

#38 blogshark on 08.27.20 at 3:31 pm

#32 Dirty Dan on 08.27.20 at 3:07 pm

Yup, 100%. And canadians will eat it up.

Congratulations on your 300 seats minimum next election, Mr.Prime Minister for life

#39 LG on 08.27.20 at 3:31 pm

Renewable Energy is Corrupt.

Mark Carney, now working in the renewable energy sector … supported by the Trudeau Liberal gang. Everyone involved will be making money from the fooled taxpayers, and supported by fooled environmentalists.

Sounds like a page out of Al Gore’s playbook. Watch Micheal Moore’s documentary “Planet of the Human” now free on YouTube. Climate change is real, renewable energy is corrupt. Follow the money.

Lack of critical thinking has brought us to this point where we (society in general) see what we want to see, not what is really happening behind the curtain.

#40 Joseph R. on 08.27.20 at 3:33 pm

#27 The Totally Unbiased, Highly Intelligent, Rational Observer on 08.27.20 at 2:42 pm

“Socially conservative means that people are concerned about morality.”

—————————————————————

No. It means they are pushing status quo and traditions on society. Despite their fear-mongering, they are not more moral or ethical than social liberals

#41 BlogDog123 on 08.27.20 at 3:33 pm

Won’t be an election called (non confidence vote) until the MPs who need to get their minimum 6 years of ‘service’ for a pension achieve that milestone.

If I were an MP in the opposition with only 5.5 years in, I’d want that fully guaranteed pension to kick in, and be sure of that before I boot Trudeau and those sanctimonious, obsequious, green ass licking MPs out the door.

Protecting their own interests first… Insane spending and debt for future generations, not so important…

Silly comment. Nobody who goes through the hell of getting elected does it to get a meagre pension after six years. – Garth

#42 Habitt on 08.27.20 at 3:41 pm

#16 millennial realist lol you still waiting? Best take a seat and number. Poor little hard done by ….. You make your generation look bad. Maybe do something instead of your constant whimpering. Maybe join the military. Not sure even that would save you. Wiener er whiner.

#43 YouKnowWho on 08.27.20 at 3:42 pm

Garth,

FYI – I figured out how Liberals justify the debt in their minds as a nothing big to worry about really.

US Population 328M
Canada Population 37.6

There is this 10:1 ratio of thinking. Even though it isn’t exactly that, let’s follow that logic. You sell something in US? You should sell 1/10th of that in Canada.

US debt? $25T USD
Canada? $1T CAD – so we can still double and not be AS bas as the “basket case” Americans

Per capita? Also works to justify more debt room in Canada. $76K USD vs. $26.6K CAD – TONS OF DEBT ROOM!

Honestly, what do you think of the glass half-full approach? Let’s compare ourselves as better than the worse student in the class, vs. the best – it’s how it is done.

#44 YouKnowWho on 08.27.20 at 3:47 pm

More economic growth brings expansion, wage pressures, rising prices and inflation

—————-

Wage pressures how? Upwards? So holding wages flat would help hold inflation? :-)

#45 SoggyShorts on 08.27.20 at 3:53 pm

#16 Millennial Realist on 08.27.20 at 2:22 pm
Paleo Boomer Cons – change is coming!
Bigly.
Be part of the change.
Or be run over by it.

*******************
So you keep saying, but all I see is taxes that you will have to pay while the boomers (and those of us who learned from them) have already won.

#46 Stone on 08.27.20 at 3:56 pm

Next week we’ll discuss how to prepare.

———

Are you going to teach us how to get nice and cozy with the Liberal Party of Canada so we can feed from the trough too? Yay!

I really want to eat from the trough!

#47 Ace Goodheart on 08.27.20 at 3:56 pm

The Bank of Canada is just printing money.

The result will be a devalued currency.

The Libs are borrowing from our own Central Bank.

Where does interest collected on printed money, that our Central Bank loans to our own government, actually go?

Yup, back to our government.

It’s a shell game.

The end result is a devalued dollar.

Only way out is for the Central Bank to convert the debt into bonds and sell the bonds to third parties.

Otherwise it’s a devalued currency

#48 BlogDog123 on 08.27.20 at 4:05 pm

#41
Silly comment. Nobody who goes through the hell of getting elected does it to get a meagre pension after six years. – Garth
===

A guaranteed pension vs. nothing would be a consideration/short term thinking once you’re in… good ol’ Bloomberg news likes to stir up the pension envy with this post:

https://www.bnnbloomberg.ca/sophomore-mps-have-pensions-at-stake-in-minority-government-s-survival-1.1356826

And remember “Vegas Girl”, I believe she was out on vacation when she found out she won for the Quebec NDP seat. Pencilled in because she had a French last name. She did however brush up on her French, represent her constituents and got re-elected for a 2nd term, so good for her!

#49 Westcdn on 08.27.20 at 4:09 pm

My preferreds ran up too high and are correcting to a more sane level. I tried to sell a few EFN’s near the top but failed – too slow. Yet I bought them at a discount so I get to keep the yield about 8% on average based on cost. There are about the only thing paying me dividends these days.

Somebody has launched an attack on the price of gold today. I guess is it to shake out weak hands in the bull option market – God, the games the champions of finance play. I am getting better with options but I play in the non investment grade market. I will keep my bets small but it nice not to have the big money crush me.

After listening to the US Fed speak, I have no fear of interest rate increases in the short term. T2’s spending plans have been greenlighted. I am surprised by the strength of the Cdn$. I attribute to the uncertainty of US politics so I paid back my us$ margin today. I don’t like the conversion fee but it is much less than a few years ago – much like broker commissions.

I see banks have gone after wealth management and are doing well. I like to pick my investments, keeps me busy and I have done okay. Trust betrayed is the worst I suffer so I do my homework and testing – no guarantee as many are slick with no morals.

#50 YouKnowWho on 08.27.20 at 4:15 pm

#43 YouKnowWho

Further to my point.

US GDP – $21T USD
Canada GDP – $1.7T USD

See…relatively close to 1/10th.

So even at 1TB, we’re 1/2 as bad as the Americans with their world reserve currency.

Canada…A OK! We can still borrow another 500B and…well, we’ll be alright!

PARTY ON REAL ESTATE!

#51 Clueless Millennial on 08.27.20 at 4:24 pm

The Chretien Libs kept the GST and finance minister Paul Martin attacked the deficit.

Is this a Liberal or a Conservative? The current Liberals would balloon that deficit for SJW, and the Progressive Conservatives would balloon that deficit to cut taxes for the foreign offshore corporations.

#52 Yukon Elvis on 08.27.20 at 4:25 pm

You give me, I vote you long time. Borrow, steal, tax rich guy, it’s ok. No care. You give, I vote you. Next !

#53 Job on 08.27.20 at 4:27 pm

trust me on this one…Should you dare criticize Freeland, the Toronto Police, OPP and RCMP would arrest you for misogyny. Toronto Police treat men accused of criticizing women far worse than a war criminal.

……………………………………………………

New Finance Minister Chrystia Freeland has already shown her colours by ramping up fiscal spending after just one day on the job

#54 Fecalnomics on 08.27.20 at 4:33 pm

Who wants the Finance Minister’s job ? as everyone else hides under the cabinet table. Good luck to her. She will need it. Expect Election before winter 2021.

#55 Dolce Vita on 08.27.20 at 4:34 pm

Good/Bad mixed numbers from StatCan “Payroll employment, earnings and hours, June 2020”.

June 2019 to June 2020:

Avg. Weekly Earnings +9.4% (+ $95.81/wk)
Number of Employees -15.1% (-2,564 thousand)

May to June 2020:

Avg. Weekly Earnings -1.8% (- $20.00/wk)
Number of Employees +4.9% (+666.5 thousand)

—————————

+ better than -, hole being filled in…slowly.

Average weekly earnings Table
https://www150.statcan.gc.ca/n1/daily-quotidien/200827/t001a-eng.htm

Number of employees Table
https://www150.statcan.gc.ca/n1/daily-quotidien/200827/t002a-eng.htm

Payroll employment, earnings and hours, June 2020 (Summary Report, Discussion)
https://www150.statcan.gc.ca/n1/daily-quotidien/200827/dq200827a-eng.htm

#56 Doug t on 08.27.20 at 4:41 pm

LAZY NATION – what happened to us? This country lost its mojo a long time ago – and now we blindly slide into a comatose state of UBI and a life of living via Instagram, Facebook and AI – we are sooooo lost

#57 bob on 08.27.20 at 4:43 pm

I care Garth, glad you do too. But we are the minority.

At the risk of being insensitive to BLM (not my intention), how about the hashtag #debtMatters?

#58 FreeBird on 08.27.20 at 4:44 pm

“It is no measure of health to be well adjusted to a profoundly sick society.“ -Jiddhu Krishnamurti

From ignorance is bliss to ignorance is strength. Too many heads in sand about govt‘s leveraging avg person/tax payer’s future (money, services, freedom/liberties) to buy votes now justifying it on fear. Playing Robin Hood….just not taking from Robin/JT and peers.

#59 Patricia on 08.27.20 at 4:45 pm

“Most recently Feeconomics has delivered another $37 billion in spending as CERB morphs into an expanded EI campaign.”
My goodness, what are they doing? Can’t they just eat cake!

#60 Jake on 08.27.20 at 4:45 pm

I doubt the Libs will just let people cave on their mortgages this Fall, this would crush our economy worse than covid. If the tap is opening even more, they will likely extend mortgage deferrals into 2021. It may not be a blanket extension as before, it will come with proof of hardship. Housing may correct, but it cannot collapse. Too much at stake.

The loans are made by the banks, not the government. They cannot just absorb payments on $180 billion in debt. Not that simple. – Garth

#61 Oracle of Ottawa on 08.27.20 at 4:47 pm

What you have is the “Me” generation handing off to the “I want it now” generation. It all comes down to greed and self fulfillment. What political party would have the balls to tell Canadians we have to be fiscally responsible and do with less. That’s political suicide.

#62 Spectacle ( hoping trudeau is charged) on 08.27.20 at 4:50 pm

#7 Barb on 08.27.20 at 2:02 pm
These people are stone-cold Marxists. They will bankrupt Canada into the new Venezuela. They don’t care about Canada, they care about their own absolute power, and absolute power corrupts absolutely. The outrageous corruption will continue with these power lusting clowns in charge.
———————–=———–=———=———–=,——–

Hmm.
I must agree Barb, the current corrupt ( and growing) government is beyond belief!
Like staring at the Debt Clock to make it real, this corruption is unfathomable for the human brain to grasp. My head hurts.

#63 Ponzius Pilatus on 08.27.20 at 4:52 pm

#17 crowdedelevatorfartz on 08.27.20 at 2:24 pm
I was thinking the other day we need the debt clock back. In every major Canadian city.
Showing Canada’s debt.
The tax liability for every person.
Etc.
I remember the one in downtown Vancouver.
People would just stop and stare at it.
Speechless.

Time for a new one before Trudeau calls another election?
Go fund me a “Debt Clock?
————————-
You got it wrong. That is the Steam Clock in Gastown.
Lots of tourists hang around there.
You probably went by there on your way to worship your hero Gassy Jack.

#64 Gg on 08.27.20 at 4:55 pm

When does raising taxes become a zero sum game and aren’t we close to that level. If you are paying more than half of what you make into taxes the next level up will only result in people not working those extra hours or avoiding the tax legally or otherwise
How can more taxes be the answer here when we are at these levels of taxation already?

#65 tccontrarian on 08.27.20 at 4:58 pm

#45 SoggyShorts on 08.27.20 at 3:53 pm

#16 Millennial Realist on 08.27.20 at 2:22 pm
Paleo Boomer Cons – change is coming!
Bigly.
Be part of the change.
Or be run over by it.
*******************

So you keep saying, but all I see is taxes that you will have to pay while the boomers (and those of us who learned from them) have already won.

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

Perfect response and exactly what I was thinking! :)

tcc

#66 Ponzius Pilatus on 08.27.20 at 5:03 pm

#56 Doug t on 08.27.20 at 4:41 pm
LAZY NATION – what happened to us? This country lost its mojo a long time ago – and now we blindly slide into a comatose state of UBI and a life of living via Instagram, Facebook and AI – we are sooooo lost
—————-
Not my experience.
In my middle class, mostly recent immigrant neighborhood, those with jobs are leaving in the morning to go to work.
Those who are still furlounghed or laid off are fixing up their houses and yards.
Still far too many F-150s for my liking on the street, so things must be good financially.

#67 Don Guillermo on 08.27.20 at 5:06 pm

#56 Doug t on 08.27.20 at 4:41 pm
LAZY NATION – what happened to us? This country lost its mojo a long time ago – and now we blindly slide into a comatose state of UBI and a life of living via Instagram, Facebook and AI, * , – we are sooooo lost

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

*and don’t forget Financial Blogs!!!

#68 KNOW IT ALL on 08.27.20 at 5:09 pm

The Gangsters and Bangsters have officially taken over

#69 JacqueShellacque on 08.27.20 at 5:18 pm

“In 1993 I completely lost it and ran for the leadership of the federal Progressive Conservative party”

I remember those days Garth, true you must’ve been completely off your nut, but at least you weren’t as boring as Boyer (there’s a guy who could, er, soothe voters) or shameless as Charest (with his ‘the Bloc is a crock’ line…in English!). It really was a bad-looking fiscal situation at the time (I remember it because I had made a crazy decision of my own at the time to study economics, a choice I both resent and regret today. I’m heartened to see you seem to harbor neither feeling re the ’93 leadership campaign). Your push for fiscal sanity bought the breathing room needed for ’08 to mostly pass us by, but these days I think there are bigger forces at play, be they monetary, fiscal or even social that have us headed full steam into the uncharted waters of debt, liabilities and whatever smokescreen policies are developed in the future to cover them (or cover them up). I know this irritates you a great deal and I promise it isn’t intentional, but doesn’t that imply a sunset for the 60/40?

#70 ImGonnaBeSick on 08.27.20 at 5:18 pm

#66 Ponzius Pilatus on 08.27.20 at 5:03 pm
#56 Doug t on 08.27.20 at 4:41 pm
LAZY NATION – what happened to us? This country lost its mojo a long time ago – and now we blindly slide into a comatose state of UBI and a life of living via Instagram, Facebook and AI – we are sooooo lost
—————-
Not my experience.
In my middle class, mostly recent immigrant neighborhood, those with jobs are leaving in the morning to go to work.
Those who are still furlounghed or laid off are fixing up their houses and yards.
Still far too many F-150s for my liking on the street, so things must be good financially.

——-

Careful now, your envy is showing…

#71 Dolce Vita on 08.27.20 at 5:18 pm

US debt? $25T USD
Canada? $1T CAD

Italia? €2.06 trillion (Cdn $3.2T), Population 60.485 million.

Using you’re population argument then Canada, to avoid being like threadbare Italia, can incur debt up to Cdn $2T.

Thank you for making me feel good about threadbare Italia:

#43 YouKnowWho

#72 MF on 08.27.20 at 5:23 pm

Of course people care.

Canada is actually better off in this regard to most other western countries. It’s counter intuitive, but it is what it is.

So,

This leads back to central banks. They kept rates too low for too long and incentivized everyone (private and public) to go in debt. They are to blame for implementing short sighted policy. Like I’ve said here many time’s, I pity the central banker that will have to face the music and do what is necessary and uncomfortable and raise the rates because he/she has no choice. Should have happened a long time ago but they took the wimpy, flaccid approach and kicked the can down the road so someone else can deal with it later (that would be my generation).

The drive towards left leaning political parties is logical and makes complete sense. The wealth gap has increased because low interest rates primarily help those at the top. There are more without who don’t care one iota about tax rates or cap gains exemptions. They don’t even know what those are. Fiscallly prudent parties are seen by the common person as being for the wealthy corporations. This isn’t my view it’s the prevailing view of many (and growinf$. It’s obvious why spending is up, and it is a good political strategy.

Rates need to rise to help heal the imbalance.

MF

#73 MF on 08.27.20 at 5:28 pm

47 Ace Goodheart on 08.27.20 at 3:56 pm

Devalued according to who?

Everyone on earth that matters is in big debt. In a world where currencies are given value by comparing them to other currencies we actually are doing alright (for now).

Think global.

MF

#74 TurnerNation on 08.27.20 at 5:34 pm

It’s almost like the global shutdown was solely to usher in a ‘New System’globally.

#75 Linda on 08.27.20 at 5:41 pm

I’m afraid I know the answer too. Unfortunately there are far too many who believe one can spend without ever having to pay the bill. ‘Just print more money’ say they. ‘Everyone deserves ______’ fill in blank space with whatever wish list of stuff. Funny how all those who say they ‘deserve’ something never ‘deserve’ paying the price for it.

#76 crowdedelevatorfartz on 08.27.20 at 5:47 pm

@#63 Ponzie Piffle
“You probably went by there on your way to worship your hero Gassy Jack.”
+++

You’re my hero Ponzie.
Every utterance is flatulence to my ears.

#77 YouKnowWho on 08.27.20 at 6:00 pm

#71 Dolce Vita

Mamma Mia! Italy GDP only $384B more than Canada ($2.084T USD) with nearly double the population? And that’s all just Ferrari and Gucci – right?

Either there is $1T of GDP under the table, or there is a lot of espresso, vespa and lova-making going on in Italy!

Thanks Italy for helping the Liberals, and Canadians feel good on our way to $2T CAD debt.

JUSTIN, JUSTIN HE’S OUR MAN!
IF HE CAN’T GIVE US MORE MONEY NO ONE CAN!

Now I’m convinced that Real Estate can be bailed out. We have the room on the credit card.

#78 Penny Henny on 08.27.20 at 6:00 pm

I’ll bet that Sail Away is jonesing

#79 binky barnes on 08.27.20 at 6:01 pm

Canada = pooched.

#80 Catalyst on 08.27.20 at 6:02 pm

Why would anyone care about debt if most of the populace doesn’t pay taxes? We are in a scary spot where taxes need to be increased at the lower end to spur responsibility back into the population. The odds of that happening however are slim…

#81 akashic record on 08.27.20 at 6:06 pm

Socially liberal. Fiscally conservative. Worked for me.

—-

Elimination $100 billion debt in 15 years. Creating $340 billion in a year.

Funny, after all these years “socially liberal fiscal conservatives” still haven’t figured out that they are useful idiot enablers for liberal power.

The ever expanding socially liberal part is where the money goes down the drain at ever expanding flow.

It is a great cover for the uber progressive, “peaceful protest” supporting Wall Street, Bay Street to print more cheap money, that mostly ends up only cents on the dollar in the pocket of the socially liberal masses.

Worked for me, the more share you had, the better.

There is no money to be made with socially and fiscally conservative, balanced budget governing.

The debt?

Ah, the debt… well.. there is always an option for a debt jubilee. The money was never real, it was all virtual, no harm is done.

#82 conan on 08.27.20 at 6:07 pm

Until recently, I did not think there would be an election. Now I am sure of it. The Conservative number crunchers should be taking note of the sad situation with their number one buddy, Mr Trump. Deferring this election, likely hurts them more, than going now.

#83 joblo on 08.27.20 at 6:11 pm

Mona Fortier
The Minister of Middle Class Prosperity

hey Mona, what up?

#84 Jeff Bush on 08.27.20 at 6:11 pm

Is this sustainable: yes.

Bernanke’s Money Financed Fiscal Programme (MFFP) would work for Canada in a low inflation environment.

#85 Useless on 08.27.20 at 6:15 pm

Hey Garth isnt the debt to GDP ratio including Provinces going to be around 115%? We were sitting around 90% before the pandemic.

#86 HighParkRanger on 08.27.20 at 6:17 pm

Hot off the press – Fitch threatens further Canada credit rating downgrades:

https://www.fitchratings.com/research/sovereigns/canadas-growing-deficit-raises-fiscal-consolidation-risks-27-08-2020

Here is something that would make CF and JT ponder, if they were smart. Are they?

#87 Out Of Work CEO, Will Travel on 08.27.20 at 6:18 pm

Maybe somebody should ring up Madura over there in Venezuela and show him the ropes.

#88 Economystic on 08.27.20 at 6:19 pm

Everything is unfolding exactly as I have forecast some time ago in these comments. We are breaking down the myth that wealth and labor are related. Soon, everyone will receive all that they need from the government whether they wish to work or not. Economystics like myself have been working diligently for years to bring this about. All the tools were silently assembled out of public view. All we were waiting for is an opportune time.

Of course we were not responsible for the pandemic, but as people will eventually see our system was what was needed to deal with it and also usher in the new age of economystical enlightenment. As people come to realize work is unnecessary, they will wonder why things weren’t always this way. These changes are permanent.

Remember the economystical motto: “Free lunch for everybody, and nobody working in the kitchen.”

More details are coming in future months and in the year ahead, but I can give you a hint of what is to come: we will be free of the chains of financial limitations. No longer will people ask questions like “who is going to pay for all the green new deal infrastructure”. The money is there if we will it to be. It is really that simple. The details are a little complicated but it simply involves notional appraisals. For example, if Amazon can go up 80% in one year, you simply need to list a solar operator on the stock market and then double the share price. It pays for itself. The public is not yet ready to understand this, but the seeds are being planted.

#89 Mark Samo on 08.27.20 at 6:20 pm

Millennial Realist, you will be starving in the future because you are inexperienced and never worked 30 or 40 years for what food you even you put in your mouth.

The old saying is truer today, you want to learn the hard way. It will get harder just like Garth says, crowding out in our economy will happen. Your Liberal Trudeau, Freeland left Socialist, Communist, Marxist daddy government will crash and destroy all the hard work and sacrifices Canada and Canadians have done for over 150 years. Good luck with your socialist utopia which will never exist. The only thing guaranteed for Millennial Realist and others that are like you is lifelong poverty.

#90 Yukon Elvis on 08.27.20 at 6:40 pm

#16 Millennial Realist on 08.27.20 at 2:22 pm

Paleo Boomer Cons – change is coming!
Bigly.
Be part of the change.
Or be run over by it.
………………………….

I am finally woke. From my nap. I lived thru 20% interest rates, market crashes, Y2K,recessions, high unemployment, inflation, stagflation, airline hijackings, oil shortages, no national health care system, Beatlemania, Trudeaumania, Vietnam, and two heart attacks. Finally now everything gonna be free. Little pissant millies with 2% mortgages,200k incomes, Beemers and Benzes, tats and tudes gonna see some shyt. Bring it now, show me the pain. I wanna see what YOU got.

#91 Do we have all the facts on 08.27.20 at 6:48 pm

The Government of Canada increased the limit for insuring residential mortgages from $600 billion to $750 billion. This means that 100% of the risk associated with over 40% of all residential mortgages issued by a financial institution could be assumed by the Government of Canada.

The Government of Canada also authorized CMHC to provide up to $295 billion in guarantees for new NHA MBS issued by financial institutions.

This support for residential mortgages also authorized CMHC to provide up to $60 billion of new guarantees for Canada Mortgage Bonds (CMB) issued through the Canada Housing Trust and secured by the purchase of NHA MBS in the secondary market.

Government of Canada support was capped off by a decision of the Bank of Canada to purchase up to $500 million of CMB per week for as long as assistance in supporting the housing market is required. By August 2020 over $8 billion of CMB had been purchased by the Bank of Canada.

My reason for pointing this out is that neither the financial institutions that issued a sizeable portion of all residential mortgages or the investors who purchased a NHA MBS or a CMB are exposed to any risk if the number of mortgage defaults in Canada were to increase.

The silver lining for the Government of Canada, and for Canadian taxpayers, is that were losses related to mortgage guarantees to become significant the shortfall could be recovered from the original mortgagors when they qualified for OAS, CPP or became entitled to a tax refund.

I am not saying this will happen only that the Government of Canada has the authority to collect any shortfall between the value of a CMHC insured mortgage and the proceeds generated through liquidation of the residence
covered by a CMHC guarantee.

Let us hope this situation never arises.

#92 jsto on 08.27.20 at 7:04 pm

If real estate post records in Covid times, there is NO better investment in Canada! NOTHING can negatively affect real estate, it’s officially untouchable! Ha-ha

#93 YouKnowWho on 08.27.20 at 7:07 pm

That’s it boys and girls. Summer, she be over.

September is here, single digit temps are in the forecast with 9C for Wasaga Beach this weekend at night. NFL is coming back.

Also back:
CERB end.
Unemployment that’s going to hold high
Patios will close – so there is that loss of revenue for restaurants.
Small Business will use up their savings and now we’ll see them folding for real with no where to run or hide.
Mortgage deferrals go bye bye
Kids won’t even have recess!
And just wait when those Floyd and Blake cops are found innocent – America will burn, burn, burn.

I’m calling it – it’s going to be a heck of a depressing fall, and even worse winter.

Enjoy the last days of summer.

It’s about to get real.

…Hope you’re behind on your stand up comedy, so you have something to fall back on for laughs.

#94 SeeB on 08.27.20 at 7:15 pm

#74 TurnerNation on 08.27.20 at 5:34 pm

It’s almost like the global shutdown was solely to usher in a ‘New System’globally.

———————————————–

You ever get tired of being the guy with no shoes, a foil hat, and wearing a sandwich board on the corner?

It’s one thing to cry wolf all the time, but another to cry global-debt-cabal-seeks-to-rule-the-world. Take a day once in a while to ask yourself “What if the stuff I’m watching on Youtube is wrong? What if all these bad actors I see are just stupid and misinformed? What if I’m not seeing other reasons for this behavior?” and make an honest and real attempt to find reason why it may not true, and consider how the opposite may possibly be true. Either you will prove it or disprove it, and you never have to tell anyone, so there’s no ego or credibility at risk.

#95 Other People's Money on 08.27.20 at 7:17 pm

#4 Captain Uppa on 08.27.20 at 1:46 pm
My wife is frugal without being cheap and hates debt. Though we obviously hold debt (home and car), she reigns in our temptations to spend while our friends buy all kinds of toys with cheap money.

She’s on a mission to reduce what debt we currently have. So as any happily married man here knows, I better comply. Lucky me.

—————————————————————

Unfortunately, I doubt that your wife or you understand the subtle difference between good debt and bad debt. The bad debt being the obvious aforementioned silly things (i.e. depreciating assets) …. the good debt is used to “leverage” investments (i.e. appreciating assets). The quicker you learn that lesson the better off you will be. I sleep like a baby with 6 or 7 figures worth of debt at any time.

There’s a reason they call it OPiuM ( Other People’s Money) cause it’s like a good drug when used properly.

#96 Smart Alec on 08.27.20 at 7:21 pm

#17 crowdedelevatorfartz on 08.27.20 at 2:24 pm

I was thinking the other day we need the debt clock back. In every major Canadian city.
Showing Canada’s debt.
The tax liability for every person.

——————————————–

Are you kidding? Do you know how much those things cost. What are you trying to do … bankrupt us?

#97 Chasicakes on 08.27.20 at 7:29 pm

My rental unit In downtown Vancouver was put on the market in mid Jiuly when there were 5 others in the same building for sale. Only 1 viewing in 5 weeks and now there are 13 units for sale in same building.

#98 Kevin on 08.27.20 at 7:33 pm

#27 The Totally Unbiased, Highly Intelligent, Rational Observer on 08.27.20 at 2:42 pm

Of course, ideally people should be both fiscally and socially conservative.

Some people seem to think that they can be fiscally conservative without being socially conservative, but both require self-restraint and self-control.”

This is a terrible line of reasoning. Why should I be socially conservative? And in what sense? If you’re gay and want to marry someone, why should I care?

I’m a moist mill aligned with Garth. Fiscally conservatively, socially liberal.

#99 Damifino on 08.27.20 at 7:41 pm

#82 conan

Until recently, I did not think there would be an election. Now I am sure of it.
—————————

The Cons & Block can save face by voting against the throne speech. There’s no reason not to since the liberal puppet wing will carry the day regardless.

At least that buys the Cons time to prepare for a showdown next spring (or probably fall) without looking like complete wimps right out of the gate.

#100 John on 08.27.20 at 7:45 pm

Greece’s debt was 400% of their GDP during the crisis. We at 50% are in a much better position. The money can’t go up in price. It will screw a lot of people. Do you think it’s good for an economy to see lots of borrowers defaulting? Don’t think so, so the money will stay low in price for a very very long period of time.

#101 Sara on 08.27.20 at 8:02 pm

#78 Penny Henny “I’ll bet that Sail Away is jonesing”

Likely. But the comments section has been much improved.

#102 Gary C on 08.27.20 at 8:05 pm

Garth the CERB is a joke, sure there are some people who legitimately deserve it, but 50% do NOT.
EX, A guy on CPP & OAS, works part time made 5000.00
In 2019, now gets 2000.00 per month.
EX, A woman who has had zero income for three years,applies and gets CERB 2000.00

Corner store employees quit after working part time, now get double the money on CRB, store can’t get them back.

All of them voting for T2, and their in Alberta

#103 Dogman01 on 08.27.20 at 8:33 pm

if you are printing money and your sovereign Fiat Peers are printing money you can dump that money in the bottom and get things moving, no chance of Inflation and no relative consequences.

If you throw $1000 to a person at the bottom they spend it on stuff and it then goes to a person at the top who already has so much stuff that they can only invest it. (no stuff inflation but yes Asset Inflation)

So really print print print until inflation gets out of hand and shove it into the bottom.

Maybe our dollar drops but if everyone else is doing it we are all relative, and regardless if our dollar tanks maybe we will start being able to make stuff and sell it to China.

#104 Shawn Pearson on 08.27.20 at 8:35 pm

Maximo Alvarez said it best about Fidel Castro’s socialist Cuba utopia BS, all they guarantee is poverty.

#105 crowdedelevatorfartz on 08.27.20 at 8:37 pm

@#90 Yukon Elvis

Two thumbs up!

#106 crowdedelevatorfartz on 08.27.20 at 8:40 pm

@#93 Sara
“#78 Penny Henny “I’ll bet that Sail Away is jonesing”

Likely. But the comments section has been much improved.”
++++

Sorry , but I disagree.
Love him or hate him.
He does have some great points with excellent arguments.

#107 crowdedelevatorfartz on 08.27.20 at 8:49 pm

@#92 Smarter than me Alec
“Are you kidding? Do you know how much those things cost. What are you trying to do … bankrupt us?”

+++
Aahahaha.
Good one.

Does anyone know who “owns” the “Debt Clock”?
When I google it the Canadian Taxpayers Federation pops up. (no surprise) witht eh “on line ” version.

Me-thinks the Canadian public in ALL major Canadian Cities need a kick in the gut with a huge debt clock ticking away for a few months…

The debt is increasing by……$10,000.00 per SECOND as I type this…….

https://www.debtclock.ca/

I’m ready to kick in a few hundred on a Go Fund me page for the recreation of the debt clock…

Maybe O’Toole cant win but at least the Canadian Public will walk into this election with their financial eyes wide open…..

Its time Trudeau and the fart catching, boot licking socialists see what their “billions per day give away” hath wrought.

#108 BCWally on 08.27.20 at 8:55 pm

I don’t believe there needs to be so much fuss. Fitch just warned about a further reduction in credit rating for our country pretty much right after Chrystia opened her mouth.
This of course means the country has to pay higher interest on its debts. The Liberals can only do what the world investment community will allow it to do.
Got another question: At what point does that ratings downgrade process snowball and cripple the economy? There doesn’t seem to be a definitive answer to that.

#109 Paul Krugman on 08.27.20 at 9:01 pm

Welcome to Alberta:

Government debt is expected to hit $100 billion by the end of the fiscal year next spring. Overall government revenue is anticipated to drop by $11.5 billion – nearly one-quarter.

Corporate tax revenue is to fall by more than half. Non-renewable resource revenue, the province’s oily lifeblood, is projected to dissipate by 73 per cent.

The update forecasts some growth by next year, but it won’t make up for a nearly nine per cent drop expected in the province’s gross domestic product this year. Unemployment, now almost 12 per cent, is expected to stay near double-digit levels into 2021.

Toews suggested cuts are coming.

#110 crowdedelevatorfartz on 08.27.20 at 9:02 pm

DELETED

#111 check please on 08.27.20 at 9:03 pm

Hi, Garth see below, your thoughts?

OTTAWA — A major global credit rating agency is issuing a new warning about federal debt that it says may become more difficult to tackle once the pandemic passes.

Fitch Ratings downgraded Canada’s triple-A credit rating in June, dropping the country to an “AA+” rating over what it called “the deterioration of Canada’s public finances” due to COVID-19.

The decision came out before the Liberals released an updated outlook in early July for federal spending, which projected a deficit of $343.2 billion and a debt of over $1.2 trillion.

Those figures were before the Liberals promised last week to spend $37 billion to revamp income support programs for hard-hit workers.

Fitch says in a note that gross government debt will be 120 per cent of economic output, which is “significantly higher” than the median for a double-A rating.

The ratings agency said it expects government spending to drop sharply starting in 2021, but the growing deficit will make reining in spending and the debt more challenging over the medium-term.

#112 Mark Windows on 08.27.20 at 9:04 pm

World Bank loan= Lockdown

https://www.youtube.com/watch?v=ALF-OYk4R74

#113 SOS on 08.27.20 at 9:05 pm

#79 Binky

Can’t you be more optimistic?

#114 Billy Buoy on 08.27.20 at 9:18 pm

https://www.usdebtclock.org/

Debt Clock? Ha..This is a real many Debt Clock.

“Never count out or bet against the USA.”

#115 meslippery on 08.27.20 at 9:20 pm

Vote for me and I will raise you interest rates.
Oh and we have such debt taxes and your loan payments will rise too.
Yeah that be why they not going up,no benifit to anyone. Please opine on who benifits from higher rates.

#116 DUFFER on 08.27.20 at 9:23 pm

@#16 Millenial Denialist
“Be part of the change.
Or be run over by it.”

I’m hiding and it can’t see me, so you and your descendants will be paying for it. Ignorance is bliss so be careful what you wish for.

#117 Ah steerage on 08.27.20 at 9:32 pm

#104 Shawn Pearson on 08.27.20 at 8:35 pm

Maximo Alvarez said it best about Fidel Castro’s socialist Cuba utopia BS, all they guarantee is poverty.
….

Hey maybe T2 does have a bit of Cuban ancestry afterall…..

#118 BC Renovator on 08.27.20 at 9:35 pm

Good reading this week Garth, Thanks

#119 I See Debt People on 08.27.20 at 9:47 pm

Why are some of us so quick to blame central blanks and governments for low interest rate policy and pro-housing programs for this massively unsustainable run up in personal mortgage debt? It is each and every individual is wholly responsible for their predicament for it is they who have signed on the dotted line… twice, first on the real estate offer and then again on the mortgage. Under the identical conditions others seems to had made conscience decisions to live within their means in residences they can afford, perhaps even embracing the forgotten concept of a modest/starter home.

#120 Sara on 08.27.20 at 9:57 pm

#108 crowdedelevatorfartz on 08.27.20 at 9:02 pm
DELETED

Looking to join your buddy SailAway? :)

#121 crowdedelevatorfartz on 08.27.20 at 9:58 pm

Hmmmm.

Apparently the Trump Hotel in Vancouver is “closing”
( rebranding)…..
No surprise.
The Trump brand in Vancouver is about as appealing as a Covid cough in an elevator.

#122 Gregor Samsa on 08.27.20 at 10:01 pm

I don’t think enough people get that the current game of artificial low rates and money printing only hurts people in other ways. 30 years ago, a house in Canada cost $150K, milk was $1, a dozen eggs was $2, etc. And the homes were better built, the quality of most food was higher and the portions larger.

If you want to eat real food of a high quality, today’s costs are enormous. So like boiling frogs we are being inflated out of existence, with the perpetrators doing it right in front of faces, right out in the open, and we cheer them on because of all the “free” stuff we are being promised.

#123 Terry on 08.27.20 at 10:01 pm

I support Erin O’Toole. Please help topple the Liberal government this Autumn. Please join me in praying for Canada…………..she is in great trouble!

#124 Ferry Boy on 08.27.20 at 10:04 pm

Some reading material for YouKnowWho and MF.

Things not quite so peachy … even Italia is in better shape!

https://theconversation.com/coronavirus-can-canada-fiscally-handle-black-swan-events-135411

#125 Sara on 08.27.20 at 10:25 pm

Not sure if it has already been mentioned here that yesterday was International Dog Day. Since this is also a dog blog, here are some seriously cute Canadian dogs. One looks like Bandit.

https://www.cbc.ca/life/pets/25-canadian-dogs-serving-up-the-cutest-canine-content-on-instagram-1.5260016

#126 Drinking on 08.27.20 at 10:33 pm

If we were a small country let us say the size of France or Spain I believe that Canucks would say enough is enough but since we are not a country, sure united by Hockey and Health care and controlled by the Learantians there is no hope; just do what you can and enjoy what you can while you can. I have an exit plan sure hope the young ones do as well.

How depressing!!!

#127 Sammy Gray on 08.27.20 at 10:36 pm

All I have is $2,500 a month total retirement income at age 68. I get my C.P.P., OAS and annuity payment that came from my workplace RRSP transferred to my LIRA lifetime single annuity.

I put my $950 each month I have left into my savings account and just leave it there. I never saved money for decades but have been doing this for a little over 3.5 years now with $40,000.

I never needed to save money as I had a decent income and modest living expenses. I always worked for 36 years at the same employer. I had used to have terrible savings habits until my income dropped by 45% in retirement. This was a big wake up call for me.

I am debt free completely. I will just let it sit and keep accumulating it. If by my 70th birthday I have $60,000 or by my $75th birthday I have $115,000 to $120,000 that will be just fine. It is a good thing financially life longevity in my family is not more than 78 to 80 years old.

I have worked in the private sector all my life. Many youngsters today are really lost and think that government will be their best chance. This is a big mistake.

#128 YouKnowWho on 08.27.20 at 10:39 pm

Trump CRUSHED IT tonight!

#129 YouKnowWho on 08.27.20 at 10:42 pm

#124 Ferry Boy

Ah, damn it! Provinces are basket cases indeed.

Thanks for correction and additional data. Yeah, the consumer debt in Canada is BRUTAL, we knew this.

I can’t believe that we’re surviving this Covid crap, having entered it at 176% household debt.

#130 Drinking on 08.27.20 at 10:42 pm

AB is now a have not Province, would never have believed this in my lifetime. It will be interesting to see how Canada pays its bills; oh it is not, this will be very interesting to see how this pans out; umm Canadian stocks, would not bet on this!!

#131 James on 08.27.20 at 10:46 pm

Re # 115 the prudent benefit from higher rates as may serve augment their investments, and normalize the cost of items that they could purchase. Does making a case for a weak dollar/nation serve anyone long term?

#132 Shelter in place on 08.27.20 at 11:15 pm

If, if, if ? If everything goes our way? Not according to the guy who pulls the lever, and that sure as hell isn’t Little Potato. Rates are already going up.

https://www.nationthailand.com/business/30393633?utm_source=homepage&utm_medium=internal_referral

#133 Long-Time Lurker on 08.27.20 at 11:22 pm

>Chrystia Freeland sings, “Don’t Cry for Me, Canada!”?

BUSINESS NEWS
JULY 30, 2014 / 10:55 AM / 6 YEARS AGO

Chronology: Argentina’s turbulent history of economic crises

BUENOS AIRES (Reuters) – Argentina was in a race against time on Wednesday to cut a deal by the end of the day with holdout investors who are suing it and to avert its second debt default in a little over a decade.

It was the latest crisis in Latin America’s No. 3 economy, which has suffered a series of economic and political meltdowns going back to the 1930s.

In the early 20th century, the South American country was one of the world’s richest, thanks to its production of beef, wheat and other farm goods, plus an educated workforce made up mostly of European immigrants and their descendants.

But the constant crises, often attributable to government mismanagement and fluctuating commodities prices, have plunged millions into poverty and put the country off-limits to all but the most daring investors today…

…2014
However, the economy is now paying the price for President Cristina Fernandez’s populist and interventionist policies, economists say, and is set to contract for the first time on an annual basis since 2002.

High government spending on social welfare programs, printing of new money and an ailing currency have fueled one of the world’s highest inflation rates. In January, the government was forced to devalue the peso….

https://www.reuters.com/article/us-argentina-debt-chronology-idUSKBN0FZ23N20140730

https://www.youtube.com/watch?v=76ZKihNCWWE

#134 TurnerNation on 08.27.20 at 11:24 pm

This is easy. *Everything* has been inverted once the New System was unleashed that Monday in March.
– All this free government money will go to those not working and grifters and Spendthrifts.
– Middle class and small business will be punished by taxation.
– Our non existent land ownership rights simply mean more taxes levied.
– Via Incrementalism we are only a few moves away from the State seizing your properties for the “less fortunate”. Equality and all.
– The State forcibly closed small businesses.
– The State released prisoners while fining law abiders.
– The State is mercilessly forcing school kids into prison-type rituals.
– A TSX listed firm just supplied US schools and school busses will AI temperature readers. 20 miliseconds is all it takes.
– This weblog mentioned a big bank forcing employees into daily temperature checks.
– That is to say in the New System healthy people are presumed sick.
– Gatherings are forbidden by our global government unless it’s a State sanctioned Marxist group doing it.

EVERYTHING has been inverted.
Beast system? You bet.
Don your Freedom Mask and submit. Keep submitting until more of the New System is rolled out.

As today’s blog details boy do they have a plan. A set timeline too. All by 2021. The #s on the telescreens will be used to keep us on the run.
As a herd of animals. Our freedoms of travel are always in the cross hairs.

#135 yvr_lurker on 08.27.20 at 11:40 pm

I have no idea how this will all look 5 years from now. Vaccine? No vaccine? Some social distancing still in effect in some seasons as Covid becomes a new ongoing reality. I do think that the vaccine path will be difficult. When people say, “when the vaccine comes, then….”, I just laugh. It is like saying “and when pigs can fly then….”.

Financially, It sort of looks like most of the entire western world is in the same boat with having to CERBify their countries and provide support for businesses. We are not unique in taking on epic debt on this by any measure. I don’t think the Gov’t had much choice in this early on. However, now is not the &^&*^& time to expand on green initiatives that will cost oodles more and bring no tangible benefits. That should wait, otherwise it is like going into debt to remodel your basement, and then with no cash reserves deciding that the building of the laneway house can’t wait. Now is not the time for this.

What I am clear about is that we need a very different relationship with China and need to wean ourselves off of expanding ties with them…. less foreign cash-cow students, bringing critical industries home, and less globalization (to some extent). Without some critical rethink of our relationship with them there is likely to be three-peat…. we must remember all of this long-term and vow to not whatever measures are needed not to have it repeated…

#136 James on 08.27.20 at 11:40 pm

The whole point of what they are doing is to inflate away the debt. When inflation picks up, they will only do token interest rate hikes to make it look like they are trying to curb it. In reality, inflation will come extremely hard and purchasing power down. Some may say it’s a dangerous game, but they will be playing it.

Going to really suck for the average working person as they won’t be getting pay raises even close to matching what the inflation will be. Yet again, standard of living will go down. House prices and the stock market will stay high as the best places for purchasing power preservation.

#137 Democracy ain't coming to the USA on 08.28.20 at 12:35 am

I’ve seen the future brother, it is murder, things are gonna slide in every direction….

The sacrilege of the trumpsters..aint no hallelujah….

#138 Dogman01 on 08.28.20 at 12:56 am

Just because: We have access to be informed in the age of the Internet.

No excuses fellow Citizens as with a vote comes great responsibility.

How Venezuela Struck it poor

https://foreignpolicy.com/2018/07/16/how-venezuela-struck-it-poor-oil-energy-chavez/

#139 A broken hallelujah on 08.28.20 at 1:48 am

Cohen passed away the night before donnie got elected…what a crazy 4 years…. he had also predicted he would win!

It’s coming to America first
The cradle of the best and of the worst
It’s here they got the range
And the machinery for change
And it’s here they got the spiritual thirst
It’s here the family’s broken
And it’s here the lonely say
That the heart has got to open
In a fundamental way
Democracy is coming to the USA

Sail on, sail on……

#140 Don Guillermo on 08.28.20 at 1:48 am

#106 crowdedelevatorfartz on 08.27.20 at 8:40 pm
@#93 Sara
“#78 Penny Henny “I’ll bet that Sail Away is jonesing”

Likely. But the comments section has been much improved.”
++++

Sorry , but I disagree.
Love him or hate him.
He does have some great points with excellent arguments.

**************************************

Agreed Fartz, I always make a point to read his posts

#141 YouKnowWho on 08.28.20 at 6:56 am

#124 Ferry Boy

Well, today we also find out how much our GDP has bled out. Projections are 40% in Q2. That’s not gonna help the ratios.

As we learned US down 32% in Q2 and that’s with all that spending and support.

Now what?

#142 YouKnowWho on 08.28.20 at 7:09 am

#124 Ferry Boy

I hate to come back to say my point is right, when you provide the summary that includes provincial debt. However, in your own link it is clear Trudeau sees it my way. He doesn’t care about the provincial debt and is doing the math my way (federal only) not Fitch way(including provincial debt). So…500B more spending, here we come baby!

Trudeau said “we are in an enviable position of having significant fiscal firepower available to support you.” He subsequently stated that “we are the G7 country with the lowest debt-to-GDP ratio,”

#143 Ferry Boy on 08.28.20 at 7:52 am

And what is in the Globe this morning?

https://www.theglobeandmail.com/business/article-fitch-issues-warning-over-canadian-federal-spending-government-debt/

“Fitch says in a note that gross government debt will be 120 per cent of economic output”

#144 Tater on 08.28.20 at 8:06 am

Amazing to see all the hard money types, who’ve been wrong since QE started, bleating now about the debt.

And the Venezuela comparisons are hilarious. Please, pick up “The Deficit Myth” and read it. You’ll have a far better understanding of how the economic and monetary system actually works.

#145 crowdedelevatorfartz on 08.28.20 at 8:21 am

@#120 Sara

I believe his nom de plume is Sail Away.
He was Suspended not Deleted.
Like several of your posts over the past few months…

#146 crowdedelevatorfartz on 08.28.20 at 8:24 am

@#144 Per-tater ( Slingblade’s fave food)

Please ‘splain the modern monetary theory to us rubes.
We’re busy countin’ our money…..

#147 Ferry Boy on 08.28.20 at 8:27 am

YouKowWho

#124 Ferry Boy

Well, today we also find out how much our GDP has bled out. Projections are 40% in Q2. That’s not gonna help the ratios.

As we learned US down 32% in Q2 and that’s with all that spending and support.

Now what?

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

my point in my posts was that Canadians have been very complacent in the levels of personal and government debt being accumulated. A lot of people are not overly worried and think the situation can continue .. or at least someone else will pay the freight

And I recognize we now need to invest further in healthcare and fix long term care .. so now is not the time to reign in spending. But how long it can continue remains to be seen.

One think I have learned over the years is that fiscal train wrecks can take a long time to play out .. so I expect this to continue for a while

#148 YouKnowWho on 08.28.20 at 8:31 am

#137 Democracy ain’t coming to the USA

—-

And Biden is the answer? The saviour? It is so easy for Trump to paint Joe as the establishment that rots.

We love predictions on this blog, so let me predict this: Biden has a major health issue, likely heart related before the election that derails him. Matters not, Trump wins anyway.

I can’t lie, I want to see Trump have the second term with no re-election pressure. I think that’s when he’ll really blow up some of this bought and paid for carrier politician garbage.

Did you guys see Trump in TV in HD yesterday? Damn he has good skin! Glowing! Maybe he squeezed a quickie in before the big speech? It seems like it would be the perfect thing to do to take the edge off. The real climax was the TRUMP 2020 fireworks going off.

What Trump did yesterday was a Mic Drop on a level never before seen. I don’t care and I don’t get a vote but I thoroughly enjoyed that show. Joe Kisses….hahaha.

#149 maxx on 08.28.20 at 8:50 am

#36 crowdedelevatorfartz on 08.27.20 at 3:14 pm

“…..Apparently you (like the majority of your cohort) weren’t paying attention when “deficit” and “debt” were being discussed.

Not to worry.

The cold cruel reality of massive personal tax increase will explain it to you.”

:)

Perhaps she can help those brighter than Millennial Realist gain insight into their fiscal deficiencies:

https://www.youtube.com/watch?v=871-3XMhtAk

#150 Jeff on 08.28.20 at 9:00 am

I was at that 1993 convention as a University Delegate.

The hottest items to collect were the “I Like Garth” and “Party on Garth” (think Wayne’s World) pins. Did you keep any? Would love to see pictures of them.

#151 Tater on 08.28.20 at 9:01 am

#146 crowdedelevatorfartz on 08.28.20 at 8:24 am
@#144 Per-tater ( Slingblade’s fave food)

Please ‘splain the modern monetary theory to us rubes.
We’re busy countin’ our money…..
—————————————————————

So much money you can’t afford a $40 book? There might even be an audio version if you find reading too much effort.

#152 TurnerNation on 08.28.20 at 9:06 am

Once again this is all about our Travel Rights – taking them away. The New Green Deal will further restrict travel, too.
We are in Phase 1, the Compliance Stage: comply or you’ll be placed on a No Fly list along with international t3rrorists. Yes that’s the penalty. You lose your rights.
Comply with the New system or else:
….
“The Globe and Mail reports in its Friday edition that Delta Air Lines has placed 240 people on a no-fly list for failing to comply with the airline’s face-mask policy, chief executive officer Ed Bastian said in a memo to employees on Thursday. A Reuters dispatch to The Globe says that there is no U.S. federal mandate on masks in airports or on airplanes, leaving U.S. airlines to enforce their own rules that passengers must wear face coverings while travelling. “Although rare, we continue to put passengers who refuse to follow the required face-covering rules on our no-fly list,” Mr. Bastian said in the memo. To obtain a boarding pass, passengers on major U.S. airlines have to check a box confirming that they will follow the mask policy. Airline gate agents can deny boarding to anyone not wearing a mask before the flight. On the plane, however, there is little flight attendants can do to ensure compliance other than threatening to put passengers on a list that would ban them from future travel on that airline.
© 2020 Canjex Publishing Ltd. All rights reserved.”

#153 jal on 08.28.20 at 9:07 am

The “Undecided” have decided
Socialist are bad
Capitalist are bad
Undecided are good
Therefore, everything remains the same.
BAD

#154 Captain Uppa on 08.28.20 at 9:08 am

A lot of people like to tout how seemingly “untouchable” the housing market is in Canada (GTA, etc.) despite a pandemic.

But perhaps look no further than Canadian banks.

#155 TurnerNation on 08.28.20 at 9:16 am

#114 David Greene on 08.28.20 at 12:27 am- you know that’s a joke right, pure propaganda right? Daily I ask myself where are all the sick people? The illusion falls apart at that point.

“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.”

**** In the GTA McDonalds has set up gross Porta Potties (Newcastle location) outside for guests. Sitting in the parking lot sun all day these units rot with open sewage.
Yes, they dialed back 100 years and got rid of indoor plumbing and basic sanitation. So concerned with our health.
Say which scientific study recommends ditching indoor plumbing and running water wand washing facilities? You learned how to use a washroom by kindergarten right?
This is all a humiliation joke on us – part of the New System breaking our morale.

#156 YouKnowWho on 08.28.20 at 9:20 am

#147 Ferry Boy

my point in my posts was that Canadians have been very complacent in the levels of personal and government debt being accumulated.

————-

Complacent?

I think we need to look into the thesaurus for another word choice. There is a new religion in town(world) in case you haven’t noticed – and it’s called “DEBT IS YOUR FRIEND”

Trudeau is clearly looking at the ratio and debt on Federal level only, and therefore set it my way – that there is easily 500B of debt spending room, and possibly up to 999B….you’re FREE to spend on the LAND Minister!

Is it me or is it starting to feel like order/chaos instead of left/right?

Republicans/Cons are painting themselves as “order”
Democrats/Libererals are therefore the “chaos”

…just crossed my mind…probably because I just saw that Mic Drop Trump speech.

No jokes, the only sensation I can compare to feeling this morning after that Trump speech is what I normally feel next day after a good concert.

Then again, it’s been so long since I’ve seen a concert (March) my emotional calibration maybe off.

#157 Ace Goodheart on 08.28.20 at 9:24 am

The “new, fair economic system” stuff should frighten anyone with assets.

There is no such thing as a new economic system. There are only variations on themes.

Capital driven economies are unfair. They have to be. The idea is, more money = more stuff. You get money by controlling the means of production of essential items.

You usually end up with a small group of people who own everything. Like the winner of a monopoly game.

However with a sufficient level of government control, capitalist economies can generate a healthy, happy middle class which can live very well. We have had that in Canada.

“Fair economics” is different. For economics to be fair you need total government control. The government owns everything and allocates things to the citizens based on need.

Most Canadian native reserves are run like this. If you want a house the band has to meet and vote in favour of you having one. Need is a big factor.

You can’t buy a house on a reserve.

Socialist fairness means anything you want, you go on a wait list. The wait can be long. In former East Germany, the wait for a badly built communist car (the Trabbant) was 20-30 years.

You can “skip” the line based on need. Social housing in Ontario is already run like this. Are you non white, lesbian with three kids running from domestic violence? You are at the front of the line for a townhouse.

White single dude? Your name is on the wait list. Check back in 20 years.

For fair economies to work, the government has to confiscate and redistribute everything.

There can be no private property.

Fair economies do not get public support in Canada, because people have it too good here.

But if enough people are put out of work and into hardship, you can get the political force for a fair economy.

I don’t see it happening here. But anyone with assets should fight hard against this sort of “economic revival “

#158 Sara on 08.28.20 at 9:38 am

#146 crowdedelevatorfartz on 08.28.20 at 8:21 am
@#120 Sara

I believe his nom de plume is Sail Away.
He was Suspended not Deleted. Like several of your posts over the past few months…

—————————————————————-
It takes a ‘special’ person — like your idol SailAway — to graduate from getting DELETED comments to being SUSPENDED from commenting at this blog where the owner has oodles of patience.

I’m not so talented. For example, of the very few deleted comments I’ve made ever at this blog (no suspensions), the last one was because I spelled your name wrong (dropped the ‘z’). No biggie.

#159 Guelph Guru on 08.28.20 at 9:43 am

I like free. I guess everyone like free. I hope the big deal has free money for everyone in Canada. Justin should not discriminate. He should have given 2000 per month to everyone. That way everyone is happy.
The question is how long can we continue handing out freebies.
Me thinks, we could have built the pipeline in AB by now. We are focusing on the wrong stuff.
This is the age of the stupid.

#160 crowdedelevatorfartz on 08.28.20 at 9:49 am

@#151 Tater
“So much money you can’t afford a $40 book? There might even be an audio version if you find reading too much effort.”
+++

You were the one mocking us for not understanding Modern Monetary Theory.
Please amaze us with your brilliant summation.
The Coles Notes version will do.
Or have you even read it or just read about it.

As I said, we’re very ,making and busy counting our money to spend time reading another economists unproven theories about how the world works..

#161 YouKnowWho on 08.28.20 at 9:51 am

#124 Ferry Boy

38.7% GDP drop in second quarter.

BRUTAL!

This 3rd quarter everyone was distracted by the sunshine. But as noted, it’s about to get real. Now we’ll see the small businesses take the real beating as they start folding en masse. Many already went out in Q2 – obviously. We’ve seen the FOR LEASE signs bloom in the summer. Those hanging on by their nails are about to fall off the cliff.

Q3 – the summer calm

Q4 – the storm with:
– CERB cliff
– Mortgage deferral cliff
– Credit Card deferral cliff
– Evictions cliff
– Small Business cliff

In fact, let’s call Q4…”The Cliff”. And just like Cliff Claven from Cheers, it ain’t gonna be funny. Watch Garth do a “CLIFF” post…use Cliff Claven on the photo – it’s been a while since we had a human photo.

#162 YouKnowWho on 08.28.20 at 10:04 am

#147 Ferry Boy

By the way….that last concert I saw 2 days before the lockdown…I $#!+ you not…BBNO$ hip hop show.

That’s right…BABY NO MONEY! How Prophetic?!

There is no doubt, the kid has skills too. Beside Lalala which you all know…have you BlogDogs ever heard “Whip a Tesla”?

I warn you…you’ll be humming this to yourself for DAYS!

https://www.youtube.com/watch?v=NyOGIsds2C4

Hey Alexa, hey Alexa
How many ******* can we fit in the Tesla?

#163 YVR Expat on 08.28.20 at 10:07 am

Soon the Freeconomics new deal will be here. Sources say Trudeau wants ‘to go big’. He now has a willing, supportive sidekick in control of the purse strings. Will the majority of people even care? Or have we become a nation of people comfortable with endless debt and free cash flow?
********************************

Welcome to Soviet Canada. First they came for your job (via COVID19), next they will come for your car (you won’t be able to drive anymore due to climate change restrictions), then your bank account. They will tell you it’s for the greater good. You know what that means.

#164 Dharma Bum on 08.28.20 at 10:17 am

#90 Yukon Elvis

I lived thru 20% interest rates, market crashes, Y2K,recessions, high unemployment, inflation, stagflation, airline hijackings, oil shortages, no national health care system, Beatlemania, Trudeaumania, Vietnam, and two heart attacks.
——————————————————————–

Ahhhhh…the good ol’ days! How I miss ’em so.
Don’t forget the Kennedy Assassination, the FLQ, the Energy Crisis, oatbran, Tab, Rochedale, bell bottoms, the wet look, tie dye, platform shoes, haircuts at The House of Lords, peeling out and burning rubber in 500 horsepower rear wheel drive sedans weighing 10,000 lbs., sit-ins, IRA bombings, the cold war, Super 8 movie cameras, Cheech & Chong, Burt Reynolds, Johnny Carson, streaking, AM radio top 40, smog, Yonge Street body rub parlours, Funland Arcade, legal firecrackers, seeing the Hell Drivers at the CNE, 10 cent payphones, Uncle Bobby, Captain Kangaroo, The Friendly Giant, Mannix, Ed Sullivan, The Flintstones, $30,000.00 Toronto houses, LCBO where you had to order the booze at a counter and white shirted dudes with skinny black ties, glasses, and crew cuts would fetch your order from a closed off warehouse, the Yonge Street Mall, 3 speed bicycles, Nixon, vinyl record albums, real rock & roll, grade 13, $2/hour minimum wage, beer in stubbies, no cellphones, Thrifty’s jean shop, Hercules Department Store, painter pants, shag haircuts, shag carpet, olive green kitchen appliances, and grocery shopping without a rag wrapped around your kisser.

Sigh.

#165 Taternuts on 08.28.20 at 10:20 am

#160 crowdedelevatorfartz on 08.28.20 at 9:49 am
@#151 Tater
“So much money you can’t afford a $40 book? There might even be an audio version if you find reading too much effort.”
+++

You were the one mocking us for not understanding Modern Monetary Theory.
Please amaze us with your brilliant summation.
The Coles Notes version will do.
Or have you even read it or just read about it.

As I said, we’re very ,making and busy counting our money to spend time reading another economists unproven theories about how the world works..
—————————————————————-

Unproven theories says the guy who expects hyperinflation. It’s all out there, if you’re too lazy to do the work that’s on you.

#166 TurnerNation on 08.28.20 at 10:22 am

#94 SeeB I don’t watch Utube. I do not “follow” anyone on social media. I lead not follow.
I have called this since the global elites shut down the old system in March and replaced it. My observations backed up with facts.
Do you not see the changes and loss of rights and bankers taking control – yet?
As someone one said the Truth is no longer hidden, people are hiding from the truth.

#167 Quintilian on 08.28.20 at 10:52 am

Go Chrystia Chrystia go.

The monetarists have had their way for a long time.
Low interest rates alone are not going to cure the malignant economic tumors such has the asset inflation they have caused.

The cons are in a tight spot, they cannot vigorously oppose the massive fiscal stimulus, nor can they stay true to the principle of minimum intervention by governments.

Previous administrations of all political stripes have abdicated their moral responsibility by signaling to their central bankers to keep interest rates too low for too long.

And now there is nowhere to turn to but massive government spending.

#168 45north on 08.28.20 at 11:33 am

a neighbour rents out his basement, now he has moved out and rents out the top half too. He told me he is charging $4,400 a month just for the top half. What!

we’re at peak insanity

so we’ve been shutdown for six months, as far as I can see there have been no consequences. My wife and I have not gone hungry. None of our family has suffered. I don’t know of anybody who has. Of course, this has been deliberate government policy and rightly so. However, there are going to be consequences, it’s just we don’t know what they will be.

Danielle Park has a piece in which she quotes Danielle DiMartino who talks about the US economy. “Financial engineering, zombie companies, bankruptcies, retail speculators, urban-exodus real estate and implications” Her (DiMartino’s) writing confirms my fears that there are going to be consequences but we just don’t see them yet.

#169 WhackoNation on 08.28.20 at 12:03 pm

166 TurnerNation on 08.28.20 at 10:22 am
#94 SeeB I don’t watch Utube. I do not “follow” anyone on social media. I lead not follow.
I have called this since the global elites shut down the old system in March and replaced it. My observations backed up with facts.
Do you not see the changes and loss of rights and bankers taking control – yet?
As someone one said the Truth is no longer hidden, people are hiding from the truth.

They own you……

#170 Nick on 08.28.20 at 12:07 pm

I love(d) your blog, but with all due respect, I feel like you are out of touch. I agree with everything you write, but the experience on the street is completely different. In the 4 years that I have been reading your blog, none of your doom and gloom has come to fruition. Home prices (in London at least) are up astronomically. Interest rates are continually at record lows. The BoC just announced that they have updated their economic policy that they won’t touch rates unless inflation exceeds 2%, and they use some skewed metric to always report low (or negative!) inflation. The government WANTS low rates and high inflation to make their debt seems smaller.

The economy (from my perspective is booming). Home building/reno supplies are sold out, bikes, cars, boats all flying off the lots. The stock market is sky high, REITs are flopping. I can’t make any sense of it, but I’d love to see you address some of these issues. You seem to always be focusing on a correction, and I suppose, eventually, when one comes you will say “I told you so”, but I’m thankful that I followed my gut and bought our dream house (with cash!), and not the advice of this blog that there will be an epic crash.

The blog has not called for an epic crash. It has stressed taking a balanced approach to everything, so hopefully you do not have all your net worth in one house in a secondary market. By the way, the Bank of Canada did not make that announcement, it was the US Fed. – Garth

#171 YouKnowWho on 08.28.20 at 1:01 pm

The blog has not called for an epic crash. It has stressed taking a balanced approach to everything, so hopefully you do not have all your net worth in one house in a secondary market. By the way, the Bank of Canada did not make that announcement, it was the US Fed. – Garth

——-

Garth, you regularly amplify those who say 20%, 30%, 40%, 50% drops without doubt. And you are more gloomy on RE than handing money over to invest. That’s what the pitch on the blog is – we know that.

Clearly the average family income and multiplier to average home in key cities make absolutely NO SENSE WHATSOEVER. They didn’t when the house were $900K, and they don’t when they certainly don’t when they are $1.8M now.

But while that observation is correct, and the fact consumer debt is 176% in Canada making consumer pickled with the solution now to this pile of debt is MORE DEBT, the lengths to which the government has gone on policy to continue to inflate RE and to push for more home ownership is incredible.

It’s a good strategy. Inflate the asset that’s just standing there. Drive the economy. Drive people to buy more SH…tuff. Contribute to GDP. You pointed this out too…what is going on with GDP? IT SUCKED in Q2. But with housing going nuts in Q3, guess what GDP will look like? Yup.

More importantly – re-asses value of people homes, and TAX, TAX, TAX! That lovely indiscriminate easy picking property tax….mmmmm….tasty.

Nicky makes a valid point though.

The only “greater fools” to date have been those NOT borrowing to the gills and buying houses.

Patently incorrect. Following that strategy in a market like Calgary has been a wealth-robbing one. People who invested in financial portfolios over the last ten years have seen higher long-term rates of appreciation than with residential real estate. It is only in selected markets and through the use of 10x or 20x leverage that real estate has made some people a lot of wealth – and only if they sell and crystallize it. The goal here is not to use a single asset to gamble on using debt, but to understand and adopt a lower-risk, longer-term path to financial security. It’s not a race. Let’s keep our pants on. – Garth

#172 Dave on 08.28.20 at 1:07 pm

GDP down almost 40%

Does this force Trudeau to pump up housing to bump up GDP.

That decline has largely been erased. – Garth

#173 JB CONDO DEATH on 08.28.20 at 1:50 pm

#89 Mark Samo on 08.27.20 at 6:20 pm

Millennial Realist, you will be starving in the future because you are inexperienced and never worked 30 or 40 years for what food you even you put in your mouth.

The old saying is truer today, you want to learn the hard way. It will get harder just like Garth says, crowding out in our economy will happen. Your Liberal Trudeau, Freeland left Socialist, Communist, Marxist daddy government will crash and destroy all the hard work and sacrifices Canada and Canadians have done for over 150 years. Good luck with your socialist utopia which will never exist. The only thing guaranteed for Millennial Realist and others that are like you is lifelong poverty.
…………………………………………………………….
Never trust anyone who owns property in Russia!

#174 Barb on 08.28.20 at 2:26 pm

“The PCs were annihilated in the next election.”

————————————————

Proof that, to have a chance, O’Toole cannot focus on fiscal responsibility. It scares the millions at the trough.

If only Garth was in government!
Either stripe (ha ha).
That’d make him a top bureaucrat.

Probably better in the long run, at least GT is capable of running the country.
T2 isn’t.

Obviously it was a great dream!

#175 Ootofthehoos on 08.28.20 at 7:58 pm

“Socially liberal. Fiscally conservative. Worked for me.”

You cannot have fiscal conservative without Christian morality because not stealing is a social conservative Christian value.

#176 willworkforpickles on 08.28.20 at 8:14 pm

#142 YouKnowWho
“Trudeau said “we are in an enviable position of having significant fiscal firepower available to support you.” He subsequently stated that “we are the G7 country with the lowest debt-to-GDP ratio,”
……………………………………………………………………………………………………….

JT’s facts are skewed as he fails to factor in provincial and municipal debt levels putting Canada in the highest debt to GDP ratio among G-7 Countries.

#177 Mike from Canmore on 08.29.20 at 2:01 pm

#134 TurnerNation “– Via Incrementalism we are only a few moves away from the State seizing your properties for the “less fortunate”. Equality and all.”
Definitely in the plan either that or raise property taxes so high one cannot afford it any more and then… repossesion.
Well, there’s a policy that has been used over the centuries called the scorched earth policy. Not advocating and I didn’t invent it, just mentioning…

#178 Mike from Canmore on 08.29.20 at 2:07 pm

#152 TurnerNation

I have now put delta airlines on my no fly list , two can play at that game hahaha. I haven’t flown anyways since like 2007 as it’s not even nice anymore and now they’re making it even worse. However if I get my own row…