The spiral

In the last few days, Bloomberg asked readers about inflation and their personal finances. Without a doubt the erosion in the value of money has been one of the biggest stories of late. Right up there with Omicron, an Ontario cat which showed up after 12 years on the lam and some germy tennis dude trying to break into Australia.

The cost of living increase in Canada is (officially) just under 5%. On Wednesday the American number is expected to come in at 7%. On the street, life is far more expensive. Housing, food, insurance, energy – all way up.

You can blame Covid for much of this, because lockdowns and WFH have meant an outsized demand for stuff and reduced demand for services. The virus also started supply chain problems by shuttering production facilities which were then unable to deal with increased orders. Now Omicron is milder but hugely infectious, causing shortages of truck drivers who deliver goods and increasing business overheads. A dearth of computer chips reduced the flow of new cars, jacking up the value of used ones. Fewer trips to Mexico or Vegas redirected people into domestic vacays, and that catapulted RV prices. Don’t even ask about exercise bicycles, skiis or fishing boats.

The next shoe to drop is wage inflation. So, back to the Bloomberg poll. Here it is…

Well, that’s interesting. Not hard to see what comes next in a society where there are more job openings than workers to fill them. As noted here a few days ago, the quit rate just spiked in the US with 4.5 million people handing in their resignations in a single month. Why? Because they’re confident a hot market for workers will land them a better position. (Besides, Millennials have zero corporate loyalty.)

So, paycheques will probably inflate. Minimum hourly pay – which just jumped in places like Ontario, to $15 – is destined to go higher. White collar salaries too, since people are desperately trying to keep up with real estate inflation. Plus mortgages are about to jump, making that steamy pile of personal debt more costly to service.

Did you catch the latest CB update?

The boss of the Federal Reserve was in Washington being grilled by politicians Tuesday, and Wall Street was pretty nervous in advance. His message: (a) we will attack inflation. (b) “If we have to raise interest rates more over time, we will. We will use our tools to get inflation back.” (c) The focus is now on long-term economic expansion, since unemployment has crashed below 4%. “To get the kind of very strong labor market we want with high participation, it is going to take a long expansion. To get a long expansion we are going to need price stability. And so in a way, high inflation is a severe threat to the achievement of maximum employment.”

As a result, the stock market went from being a few hundred points in the red, back into the green. Investors trust this guy. The odds of a rate increase in March are now 90%, and the expectation is increases will happen four times in 2022. More the year after. Ironically higher rates are designed to fight inflation by removing stimulus from the economy. But in reality the increased cost of money will seriously impact middle-class families whose reach exceeded their grasp when it comes to residential real estate. It’s not hard to envision a few years of rising debt service costs prompting more wage increases, begetting higher prices throughout society, with extra inflation and a CB response.

In short, kids, welcome to the Eighties.

Inflation in Canada in 1980 was over 10%. By 1983 it had dropped to just over 5% – not far off the level now. Mortgage rates in 1980 were 14% (for a fiver) and by 1985 had plunged to just under 12%. Of course, high rates meant lower prices for assets like houses. Average family income was $55,000 in 1980. The average house in Toronto cost $75,700.

You can see what a pandemic and crazed, cheap, depressed, in-the-ditch mortgage rates of 2% have done to the cost of accommodation.

But now it flips. Enjoy the ride. And ask for a big raise.

About the picture: “Love the blog, I’ve been reading it for years,” Steve writes me. “This is Charlie in his prime from a few years ago.  He loved wintertime walks in our woodlot in Debert, NS.  We said goodbye to Charlie today after more than 13 years of belly rubs and companionship.  What a good boy he was!” 

203 comments ↓

#1 Paddy on 01.11.22 at 3:57 pm

Steve, thank you for sharing this lovely pic of Charlie.
He was obviously one happy pupster. Good boy????….no no no…Best boy is more like it. I’m sure he’ll be missed dearly.

#2 Gravycanuck on 01.11.22 at 3:58 pm

Is there any difference yet in wage inflation between high income and low income?

#3 Søren Angst on 01.11.22 at 4:00 pm

Omens II.

HOPE.

https://i.imgur.com/5vlLY7i.png
https://i.imgur.com/jB7DQV9.png

…and

Omicron BA.1 sibling on the rise?

BA.2

https://world-today-news.com/a-glance-at-the-more-mutated-omicron/

A SCARIANT like Deltacron?

—————-

And ya, the 80s revisited. So true Garth.

https://www.youtube.com/watch?v=5IiFf_rdFEI

Run. Hide.

#4 Søren Angst on 01.11.22 at 4:02 pm

They only apprehension I have about this Covid dynastic animation is this:

Jan ’21 –> July –> Jan –> July?

https://twitter.com/theosanderson/status/1480600931364442114

Expect something in July 2022?

This is Covid Year AD 3.

I believe it will be mostly over by the end of this year +2 more years mopping up, putting fires out in the rest of the World.

Covid Year AD 5. Pandemic –> Endemic.

WHO thinks half of Europe will get infected within 2 months = 374.15 million (lucky us):

https://edition.cnn.com/2022/01/11/europe/europe-half-infected-omicron-who-intl/index.html

They’ve gone from telling us NOTHING, “it’s all good” (e.g., original Canary in the Coal Mine Italia early 2020) to getting all sky is falling at the drop of a hat.

Je me souviens.

#5 Andrewski on 01.11.22 at 4:03 pm

Speaking of selling used cars…

https://www.cbc.ca/news/canada/toronto/businessman-accused-ponzi-scheme-1.6306466

And he scammed the wrong people:

“some individuals with ties to illegal gambling rings in Woodbridge, north of Toronto, have made late-night visits to the 42-year-old’s former home, and the homes of his family members, making violent threats and demanding to know Cohen’s whereabouts to get their money back.”

#6 Søren Angst on 01.11.22 at 4:05 pm

Re: OMENS II

On mandatory vaxing, myself EACH HIS/HER/Bill C-16 OWN with this CAVEAT:

Mind vs. Matter.

Freedoms/Rights vs. Mother Nature/Natural Selection

When the latter flexes, the former forcibly confined…

“Inhabitants were to stay indoors for one month after the death or infection of anyone in the building…BLUE CROSSES should be attached to doors of houses that held anyone infected with plague over the past week.”

– Lord Mayor of London, Sir John Whyte, 1563.

https://www.historyextra.com/period/medieval/plague-black-death-quarantine-history-how-stop-spread/

————–

Freedoms/Rights bluster’s, shakes its fist whilst HIDING behind the skirt and tails of 21st C medicine. *

“They fancied themselves free, and no one will ever be free so long as there are pestilences.”

– The Plague, Albert Camus

STILL, each his/her/Bill C-16 OWN.

* Freedoms/Rights eroded are seldom restored.

– John Adams to Abigail Adams, 7 July 1775

Human Nature, understood near 250 yrs ago – since time immemorial.

#7 Dogman01 on 01.11.22 at 4:06 pm

#124 Shawn on 01.10.22 at 10:59 pm

Thanks for answer, I kinda figured that GDP must be adjusted otherwise with it would be pretty obvious.

Yes – My Tax question was obtuse; but Googled it.
Was wondering if Inflation would place more people in a higher tax bracket, assuming a wage earner received a raise.
However I see that the Basics Personal amount does go up each year so they must adjust brackets higher must be a formula.
2020 $13,229
2021 $13,808

Up by $579 so 4.38%

I know they adjust CPP each year, do they use the same formula for Tax adjustment?

I noticed TFSA amount did not increase this year….

#8 John on 01.11.22 at 4:06 pm

There shall be a maximum of TWO interest rate increases of 0.25% each by 2023, before the Fed backs off yet again. If we’re lucky.

#9 Dogman01 on 01.11.22 at 4:08 pm

“I do love a good conspiracy theory — and now it feels just like I’m actually in one!”
———————————
#177 The West on 01.09.22 at 11:12 pm

…something is very, very suspicious about all of this

————————————-
#205 Numbers on 01.10.22 at 8:55 am

We need our governments and organizations that are tasked with gathering that information to release it, to be transparent and truthful. I think more and more people are noticing they have not been, and that is very unfortunate for may reasons. Not for those people, but for the fact that those organizations have lost trust and credibility – and I’m not sure how they can operate effectively going forward.

———————————

#164 Network Admin on 01.11.22 at 10:23 am
The reason some people are vaccine hesitant is a loss of trust in media.

—————————–

Great explanation and spot-on.

We have a growing fundamental mistrust in our institutions. Which is now creating a breakdown in institutional trust, eroding and perhaps ultimately destroying “peace order and good government”.

It is incompetence or is it deliberate?

Bitcoin seems driven by the same phenomena of loss of trust in currencies\government (that is why it is so popular in the authoritarian run parts of the world).

#10 Doug t on 01.11.22 at 4:10 pm

Come gather ’round people
Wherever you roam
And admit that the waters
Around you have grown
And accept it that soon
You’ll be drenched to the bone
If your time to you is worth savin’
And you better start swimmin’
Or you’ll sink like a stone
For the times they are a-changin

#11 Imagine dragons on 01.11.22 at 4:12 pm

Joe Biden ‘Confident’ His Team ‘On the Right Track’ on Coronavirus as Hospitalizations Hit Record Levels….

Imagine if the vaccine didn’t work, this happened with mass vaxx campaigns working. ROFL

#12 SunShowers on 01.11.22 at 4:14 pm

“Besides, Millennials have zero corporate loyalty.”

Back when workers had corporate loyalty, they could expect a DB pension in return for it.

If you build it, they will come (and stay).

#13 Dave on 01.11.22 at 4:16 pm

For my household I’m calculating inflation as roughly 15% for essentials. Is it a decent rule of thumb to double (or triple) the government inflation number to get a ‘real’ estimate?

#14 Billy Buoy on 01.11.22 at 4:17 pm

Just absolutely shocking Jerome walked back the heat generated the past few days at rumour of rate hikes and looky what happened….

Good job Jerome, your masters are proud and bought the dip for the 86533789753367 time.

Rate hikes..Still faaaaar away and Jerry is doing everything he can to keep the 1% entitled.

Good work Jerry…2 more years of this and you could go down in history.

#15 crowdedelevatorfartz on 01.11.22 at 4:17 pm

@#210 Sunshowers ( always make me happy)

“My wife’s doctor retired last year. She called 311, gave her particulars, and the regional health authority emailed her a list of doctors accepting new patients in the area within a week.”

+++
Not from BC eh?

Well its fine to ignore the News clips from all across Canada complaining of long lineups, quadrupling surgery waits, elective surgery wait list deaths….. yep.
Its alllll “fake news”
Because it doesnt fit YOUR agenda.

I ask again.
What mythical city, town whatever has 1 hour ER waits, where no one complains about elective surgery ( not emergency surgery) waits ( I guess 710 days waits for hip, knee replacement is “normal” in your town? No one complains?)

Please educate us as to where this mythical town is?
We all want to fly there to get our knees, hips, cataracts, backs, etc etc etc repaired, removed or replaced.
Save us some money!
We don’t want to have to fly to the US or France like the “rich” who are in pain and agony are forced to do after months and years long waiting lists…..

Help us……

#16 ogdoad on 01.11.22 at 4:19 pm

let’s not forget the increase in mental health issues brought on by months and months of booze, weed and screens – horny peeps in their 20’s are in for a surprise when they realize that most dude’s don’t have abs (I can help) and most gals don’t look like Jenny Lawrence.

Or just the hours of boredom. Same thing day in, day out…reality – have a look at your life. Mom was wrong. Blame her upbringing.

I can’t count on both hands how many people have told me they need change – what, designing a lever to go inside a widget that fits inside a box which clips to whatever isn’t quite grinding the gears…before you DIE? Sorry, low hangers.

Yes, y’all deserve a raise. Booze prices are rising. And coffee inside the metaverse isn’t free.

Og

#17 DON on 01.11.22 at 4:19 pm

#8 John on 01.11.22 at 4:06 pm
There shall be a maximum of TWO interest rate increases of 0.25% each by 2023, before the Fed backs off yet again. If we’re lucky.

*********
Why don’t you elaborate…what would a quick reversal indicate if that happened? Inflation is the new bully in town.

#18 IHCTD9 on 01.11.22 at 4:19 pm

Average family income in Toronto 2021: 109K (up 98%)
Average house in Toronto 2021: 1.6 Million (up 2114%)

Yep, we’re heading in the right direction. Fastest acceleration of this price increase was over just the last 7 years once Trudeau took the reins.

Good job Libs.

Get retired asap dogs, this will continue until it explodes. You don’t want to fund the government allowing this clown show to continue, nor do you want to foot the cleanup bill once it’s been reduced to ash. These Libs are more dangerous, and more toxic, than “happy fun ball”.

https://www.youtube.com/watch?v=GmqeZl8OI2M

#19 Billy Buoy on 01.11.22 at 4:20 pm

#8 John

2 hikes of .25 each?

Watch out some people here who can see the future and are clairvoyant will be angry and will call you out on your educated guess..goes against the blog policy of free speech.

Just a warning from someone who agrees with you.

#20 Faron on 01.11.22 at 4:21 pm

Sorry to hear about Charlie. Judging by the photo, he appears to have been a very good boy. Perhaps even the best boy. And, because it has to be said, sorry Charlie. You were obviously loved.

Garth, I’m amazed at your fortitude the past couple of days in comments. Until today, never had I seen or read of someone utilizing their washboard abs to so effectively deflect public health cretins. Well done.

#21 Zed on 01.11.22 at 4:21 pm

…and some germy tennis dude trying to break into Australia.

How is he more germy than the next person? He is healthy, young and he tested negative.

Garth, you are encouraging the split in society.

#22 JSS on 01.11.22 at 4:24 pm

Wages depend on whether you’re working in private or public sector
– In private sector, yes could be wage increases 2.5%+/yr
– In public sector, probably between 0-1.5%/yr

Also, geographically:
– In BC/ON/MB, yes wage increases are coming
– In AB… no, until AB wages fall in line with the rest of the country

Government can also increase immigration, which will bring wage stability and control. Most recent immigrants are satisfied with having a job, especially a white collar job. As a result, they may accept less salary, as they’re beginning their lives in a new country.

#23 AM in MN on 01.11.22 at 4:25 pm

#182 Faron on 01.11.22 at 11:54 am
#178 AM in MN on 01.11.22 at 11:41 am

Any examples you can put forward of people being “persecuted” by conservatives?

Conversion therapy is the domain of the religious right. That took 0.05 milliseconds to come up with. Shall I make you a list, dawn of Duluth?

——————————————————–

“Persecuted” means by the government, with the power to throw you in jail or confiscate your property. No church can do that. No church can force you to be a member.

The government can force you to pay for the chaos of others though, as well as destroy your business and whole host of other negative impacts on your life, as we’re seeing now.

I disagree with Garth about going back to the ’80’s, I think it’ll be more like the ’70’s.

#24 Søren Angst on 01.11.22 at 4:25 pm

Garth I agree with you but…

if finances, wages are so fragile, debt so high, then aggressive CB rate increases may precipitate a

recession.

Hopefully the Fed knows what it is doing and acts with prudence rather than fury.

And yes Mr. Market trusts the Fed…green across the board today for my Threadbare Portfolio.

#25 Barb on 01.11.22 at 4:31 pm

Steve, awwww…Charlie was such a handsome creature.
Looks like he didn’t want to leave the outdoors as he was having too much fun.

Condolences on the loss of your buddy.

#26 Pylot Project on 01.11.22 at 4:34 pm

But now it flips. Enjoy the ride. And ask for a big raise.

===

That made me laugh. Good one Garth. The joint I work at gave us a New Years gift of a company wide wage freeze.

#27 Faron on 01.11.22 at 4:37 pm

#8 John on 01.11.22 at 4:06 pm

There shall be a maximum of TWO interest rate increases of 0.25% each by 2023, before the Fed backs off yet again. If we’re lucky.

Nope, central banks wont have a choice but to raise. Unless a market whoopsie causes inflation to somehow drop back to 3% (not gonna happen) central banks will have to raise the overnight rates, potentially sharply, to prevent serious stagflation regardless of how equities repond. Bond markets will take care of the rest of the curve.

Previous instances of rate cuts were different because the background inflation allowed them. For instance, in 2018, the fed was free to cut rates in the face of the econ downturn because inflation was running cool (3% tops). Cutting rates met both purposes of stimulating the financial system (yay 2019 NASDAQ) and preventing deflation. Very different scenario now.

CB’s are in a horrible spot rat present and, politically, IMO this isn’t going to end well with the global system of central banks that we have now. I fear that the combination of a forced CB policy error and the already established rise of nationalism isn’t going to bode well for global unity. Or eventually, the global stonk market that may have to live with much lower profit margins as nations re-crystalize and cut global ties and lose the profit edge globalization brought. But that’s another topic entirely.

I’m definitely not an end-of-worlder, but I think there are a lot of very massive economic weights that are starting to move around and that may usher in, gradually of course, a new era.

#28 Cheese on 01.11.22 at 4:37 pm

$19/hr at the ottawa general hospital. No holidays other than christmas. If I ask for a raise I will likely be let go and worse off. There really is no winning in 2023.

Being a subcontractor is suffering.

Things are getting nuts here, everyone is stressed, they are also laying off staff to replace them in the food services with a subcontractor with the lowest bid.

Take care of yourself and don’t go to the hospital, the food will kill you.

#29 Prince Polo on 01.11.22 at 4:40 pm

Unloyal loser rentin’ Millennial here. Been with my current company since 2010….see Garth, we aren’t all bad. Looking forward to all the juicy divvy hikes from those pathetic Cdn Banks!

#30 yorkville renter on 01.11.22 at 4:40 pm

Gave myself a $34K raise yesterday… I’m worth it, and I deserve it :-)

Employees are next, and they are in for 5-figure raises too.

Not because of inflation, but 2021 was a good year for the biz!

#31 crowdedelevatorfartz on 01.11.22 at 4:41 pm

@#210 Sunshowers

“What’s the point? You wouldn’t believe me if I told you. You’re not coming from a place of facts or logic, so no facts or logic on my end can convince you of anything.”

+++

Apparently irony escapes you.

Ignore the previous news articles I posted regarding ludicrous wait times ( 710 days for knee replacement in Nova Scotia, A quadrupling of the surgery wait list in Quebec, on and on) for regular surgeries.
No no.
You rather generalize about the fabulous medical system Canada has.

How about this 5 year old kid that has lost one kidney and has had her “elective” ( insert necessary) surgery delayed once again….

Our collapsing Health Care at work…..

Last nights 6pm Vancouver News

https://globalnews.ca/video/8502431/concern-grows-for-maple-ridge-girl-whose-surgery-is-delayed

#32 Cheese on 01.11.22 at 4:43 pm

from yesterdays posts:

Anti-vaxxers love to use the ‘vaccinated still get infected’. Yet they fail to do even basic research into sterilizing vs non-sterilizing vaccines.

mRNA vaccines still provide T-cell response, even if the antibodies from them were coded to the initial and delta strain.

Omicron requires different antibodies, hence why you still get infected while vaccinated, but you T-cells are primed so the illness is mild.

Antivaxxers are willfully ignorant and spend far too much time engaged in motivated reasoning and ‘muh freedoms’

Go read the Herman Cain awards on reddit, it will provide some insight into the fate of the anti-vax crowd.

Stay safe, best wishes to all.

#33 Wrk.dover on 01.11.22 at 4:45 pm

Got interrupted yesterday, couldn’t buy the dip through this morning before Stonewall Powell spoke.

Sen Kennedy showed a compressed graph with the economy going straight up since 08, asked why interest couldn’t have been increased during this momentum?

Powel even said wages are at a thirty year high!!!!

No interest increase in sight.

Dip gone. No surprise there. At. All.

#34 Mehling on 01.11.22 at 4:47 pm

“Canada’s Quebec plans health tax for residents who refuse COVID-19 vaccine – premier”

https://gazette.com/news/us-world/canadas-quebec-plans-health-tax-for-residents-who-refuse-covid-19-vaccine—premier/article_0023534e-e67c-5cd4-81bd-a7b2f97689ad.html

Should ensure quick adoption, unless they’re already on the CERB / welfare.

I told ya it was coming. – Garth

#35 VladTor on 01.11.22 at 4:48 pm

…Wall Street was pretty nervous in advance. His message:…a) b) c)….

************
Some meaningless set of words. They don’t really know what to do.

I would added d) We are in panic!

The TSX added 200 points today and the Dow 183. Some panic. – Garth

#36 fishman on 01.11.22 at 4:52 pm

The same ride as 80’s in the sense that roller coaster rides are the same. But different like Six Flags to our old coaster at the PNE. I was punished in the 80’s ride. I’ll call that a Six Flags ride. Theres enough systemic problems across Canada that this one, I think, is going to be a good old fashioned grinder. I love Vantowns old roller coaster. That spaghetti of 2×4’s could, for real, collapse. The slow grind up. Gives one time to contemplate ones demise.

#37 David on 01.11.22 at 4:56 pm

It’s rent loss vs house loss calculation. Maybe Winnipeg and similar cities are different.

I have been renting a 1 bedroom, 1 bathroom unit in a 1950’s building for the last 4.5 years. No en-suite laundry, no dishwasher, an older kitchen and bathroom (both original). No A/C (use portable device). Nice view along the river, detached single garage and in a central/nice area. Also, good storage and closet space for a 1 bedroom. About 700sqft.

Rent including parking and water: $1355/month
Insurance: $25/month
Hydro: $30/month

All in $1410/month is lost.

Rent goes up only $20/month each year due to being a 20 years plus building (controlled). I can get an updated bathroom and kitchen for an extra $150/month bringing the total to $1560/month.

It’s the 2 of us but let’s be serious if you have 1 kid over 5 you need a 2 bedroom. That runs $1610/month or $1760/month if you do the upgrade.

A 2 bedroom in Winnipeg runs on average around $1450/month all in. But if you want to be in a newer unit or central or a good area your looking at $1700+/month.

So let’s use $1600/month for a 2 bedroom all in. $1600×12 = $19,200.

The breakeven point at 4% interest rate would be a purchase price of $400,000 with 20% down. So $80,000 down. This can be done in Winnipeg. If the area is more central/nicer you won’t get it all (lot size, house size, renovated year 2000+) but you still get a decent place.

Something like a 2 storey from 1950’s that has no structural issues, up to code services (electrical panel, water, sewer). 2010 windows, 2018 roof, detached 2 car garage, 60% grounded (kitchen, utility room) but no knob and tube or aluminum wiring, basement stripped to the walls and framed/insulated. 3 bedroom, 1 bathroom, half finished basement, small garden and small backyard. 1300sqft (650×2).

$12,800/year for interest (simplified)
$4300/year for property tax
$850/year for house insurance
$1600/year utilities
$2000/year maintenance

Total is $21550/year

So $2300/year more but for a lot more.

Taking into account the potential investment based on the 80,000 down payment. The rent would be $6400/year cheaper if you got 8%.

But the other argument is your only putting $80,000 at first towards the home and if the house goes up 1% per year that’s $4000/year.

So let’s lower the rent by only $2400/year.

Overall it’s $4,700 more per year but your getting the house described vs a 2 bedroom apartment.

A more expensive 2 bedroom would mean the options would break even regarding $/year. Or a cheaper home ($350,000).

With rates at 1.5-2%. The home Choice at 400,000 would cost less due to interest not being $12,800/year but around $6000/year.

The question is do you have more money to pay off the house? That’s where people rent because they can’t afford the other payment.

Land transfer and legal fees would be a 1 time payment of about $7500.

#38 tc-contra on 01.11.22 at 4:58 pm

Some interesting developments down south and it appears that Anthony Fauci may have perjured himself last summer:

[WASHINGTON, D.C. – Jan. 10, 2022] Project Veritas has obtained startling never-before-seen documents regarding the origins of COVID-19, gain of function research, vaccines, potential treatments which have been suppressed, and the government’s effort to conceal all of this.

#39 HUNGRY BEAR on 01.11.22 at 5:00 pm

I Hate when Garth is right!

…..DAMN I sold to early.

#40 TurnerNation on 01.11.22 at 5:02 pm

Finally a dog photo!

– On the Economic Shutdowns. MSN cannot ignore. ON’ “Re-opening Act” is indeed a Re-Closing act.

“What exactly is Ontario’s exit plan?”
https://www.tvo.org/article/what-exactly-is-ontarios-exit-plan

— Making us dependent upon government handouts is a goal of this planned Great Reset. Ready for Year 3?

https://westernstandardonline.com/2022/01/half-of-businesses-closed-in-pandemic-havent-reopened/
Blacklock’s Reporter said researchers tracked 12,976 businesses in Vancouver, Toronto and Ottawa that were subject to lockdown orders in April and May 2021 including bars, restaurants, shops, nightclubs and motels. “Half of businesses recorded as temporarily closed in May had reopened by the end of September,” said the bank report.
“In my view there are hundreds of thousands of zombie businesses, businesses that are essentially dead but haven’t finalized the closure process altogether,” testified Dan Kelly, CEO of the Federation.”


– The noose is fast tightening in Kanada.

https://calgaryherald.com/opinion/columnists/corbella-ucp-government-plans-to-attack-our-fundamental-rights-dont-let-it
“The Provincial Administrative Penalties Act will not only essentially eliminate traffic court but also the right to due process, the right to face your accuser, the right to cross examine testimony provided by your accuser or witnesses and, as already mentioned, the right to be presumed innocent”

— Don’t give our Regime any more ideas…

.Social media users who mock UAE COVID-19 rules face jail time (english.alarabiya.net)

—-
— Science in Kanada. Laugh or Cry? Also, the provinces spent tons on the “voluntary” (wink wink) secure CV Isolation sites On hospital capacity not so much.

.Ontario considered forcing hospitals to re-hire unvaccinated staff as surging case numbers strain health-care providers (ottawacitizen.com)

#41 Nonplused on 01.11.22 at 5:04 pm

“Inflation in Canada in 1980 was over 10%. By 1983 it had dropped to just over 5% – not far off the level now. Mortgage rates in 1980 were 14% (for a fiver) and by 1985 had plunged to just under 12%. Of course, high rates meant lower prices for assets like houses. Average family income was $55,000 in 1980. The average house in Toronto cost $75,700.”

Toronto house prices at 1.5 times income? Maybe if we get 14% interest rates, but I don’t see it.

My prediction would be that the total monthly payment as defined by the principle of the mortgage (and thus house prices) and the interest rate will remain about the same, meaning housing isn’t going to get any more affordable even if rates rise causing prices to fall.

What needs to happen in order to offer any serious relief to the cost of housing is more must be built. Whether condos in the sky or distant suburbs or basement suites, we need more units. Unfortunately this is very difficult and expensive to do in YVR and YYZ.

And adding even more complexity to the problem, if rising interest rates cause a corresponding reduction in prices, well, there goes your incentive to build if you are a developer.

There is no way out so long as everyone in the country wants to live in just two cities. But given that most of the rest of the country is uninhabitable, here we are.

#42 Jens on 01.11.22 at 5:08 pm

So what if interest rates are being raised, but not by enough to combat the effect of inflation? Then governments will milk both the boomers’ cash accounts and the millennials’ debt heaps, while reducing their own debt pile in real terms. And Garth’s B&D portfolio holders can watch from the stands, enjoying the spectacle.

#43 Linda on 01.11.22 at 5:12 pm

RIP Charlie, chest high & pretty in the snow.

I await with bated breath the next (likely understated) official inflation number. I believe that gets released to our disbelieving eyes next week in Canada. As for wage increases, going to be interesting to see how struggling businesses dealing with the fallout from the virus, supply chain issues & increased expenses for pretty much everything across the board are going to be able to fork out more $ to employees. I did see a headline that Quebec got the feds to lift the cap on foreign workers. That presumably is one way to get around those pesky demands for more money from Canadian workers.

#44 baloney Sandwitch on 01.11.22 at 5:18 pm

Looks like France is turning the heat up on antivaxxers. Something like covering them with poo etc.
https://wapo.st/3feSRZH
Also looks like we have flipped into inflationary times. This could last a decade. Big implications for investing.

#45 DON on 01.11.22 at 5:21 pm

#24 Søren Angst on 01.11.22 at 4:25 pm
Garth I agree with you but…

if finances, wages are so fragile, debt so high, then aggressive CB rate increases may precipitate a

recession.

Hopefully the Fed knows what it is doing and acts with prudence rather than fury.

And yes Mr. Market trusts the Fed…green across the board today for my Threadbare Portfolio.

**********

I read recently that 38-45 months after rates are initially increased a downturn emerges.

#46 Shawn on 01.11.22 at 5:25 pm

To my friend Dogman01

#7 Dogman01 on 01.11.22 at 4:06 pm
#124 Shawn on 01.10.22 at 10:59 pm

Thanks for answer, I kinda figured that GDP must be adjusted otherwise with it would be pretty obvious.

Yes – My Tax question was obtuse; but Googled it.
Was wondering if Inflation would place more people in a higher tax bracket, assuming a wage earner received a raise.
However I see that the Basics Personal amount does go up each year so they must adjust brackets higher must be a formula.
2020 $13,229
2021 $13,808

Up by $579 so 4.38%

I know they adjust CPP each year, do they use the same formula for Tax adjustment?

I noticed TFSA amount did not increase this year….

*****************
Actually after the fact I relized you were just asking if tax brackets are indexed. As you found out, yes they are and have been for a long time at the federal level. I’m not sure exactly how but probably the same as public servant pension inflation which is the average of the 12 numbers ended September of the previous year.

TFSA goes up in $500 increments when inflation accumulates that much. They save the inflation for a few years and when it is accumulated to justify a $500 increase they do that. It’s all good TFSA is a gift to investors so let’s all just be quietly thankful and not call too much attention lest the left decides its too generous.

#47 VladTor on 01.11.22 at 5:26 pm

The TSX added 200 points today and the Dow 183. Some panic. – Garth

*************
Very good! It just QE flooding market with printed money.

Can you explain to me what happened in the economy that would explain the rapid growth of these TSX/DOW over the past year. Maybe I didn’t notice the coming of the industrial revolution? Or something else????

#48 Steuy on 01.11.22 at 5:27 pm

Oh No, not the Eighties! Do I have to wear Big Hair Again?Reganomics was a thing back then. What will we call it this Time; Bidenomics???

#49 SunShowers on 01.11.22 at 5:27 pm

#34 Mehling on 01.11.22 at 4:47 pm
“Canada’s Quebec plans health tax for residents who refuse COVID-19 vaccine – premier”

I told ya it was coming. – Garth

Given that we’ve run out of carrots, and are now debating what variety of stick to beat the anti-vaxers with, this one is my least favorite. Vaccine passports are one thing, as it’s not a right to go to a restaurant, concert, sports game, movie theatre, be admitted into a private building, etc.

But we’ve decided that healthcare is a right, and once you start making exceptions to exclude people, it makes it easier to exclude other people for other reasons. I bet a lot of people would agree with making smokers and alcoholics pay an additional healthcare tax (even though tobacco and alcohol are already massively taxed upfront as it is to offset their healthcare costs.) I think that’s a slippery slope.

It’s only a right if everybody has equal and unfettered access to it, even people who you think don’t deserve it because they squander it.

Maybe we should tax Fox News, other “alternative news” sites, and social media, and use that to offset the strain on our healthcare system as a result of the brain-rot they cultivated.

#50 The West on 01.11.22 at 5:32 pm

#88 Diamond Dog

Well written.

#51 VladTor on 01.11.22 at 5:32 pm

Garth….Average family income was $55,000 in 1980. The average house in Toronto cost $75,700.

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

Garth this is unbelievable!
Working Canadians could become owner of house just in 3-5 years. Comparing income now and cost of house now.

Canada economy in deep ass (sorry!).

#52 Shawn on 01.11.22 at 5:34 pm

Powell and inflation and mortgages

Seems like the market WANTS to go up. Otherwise why so soothed when he confirms rate increases coming?

Mortgages were 12% last time inflation was 5%. Yes and that is shocking to remember but yes, I was there. We thought we would never see mortgages unfer 10% again.

Mortgage rates then declined very very slowly over many years. Maybe there is inertia in the system. Will they also rise slowly?

What crazy math made lenders demand 12% at 5% inflation in 1990? Something has changed in the ability of banks to lend. Yet CMHC was in place for a long time by 1990. Were bankers just completely scared by memories of the high inflation years and now they forgot about that and are super complacent? I don’t know…

Lending creates its own supply of deposits and maybe what has changed is that deposits now really can’t ever leave the banks as a group.

The supply of money to lend is not constrained by available deposits (for the banks as a collective since lending creates deposits). The supply is constrained by the willingness to lend and by the ability of banks to raise equity capital if needed which is not a problem. Are risk management systems so much better now that bankers have no fear?

#53 Shawn on 01.11.22 at 5:34 pm

P.S. Aloha… Maui is a lovely place.

#54 Another Deckchair on 01.11.22 at 5:47 pm

Back in the 80’s I went to my boss with charts of my salary, at that point had been up 12% yearly. Wanted another 12%. Boss said “if I give you 12% you will make more than me”.

That was a woah, have to maybe focus more on the spending moment.

Did move to a different country and got a huge raise, but it did start my “watch where the money goes” program that continues to this day.

#55 Faron on 01.11.22 at 5:53 pm

#23 AM in MN on 01.11.22 at 4:25 pm

#182 Faron on 01.11.22 at 11:54 am
#178 AM in MN on 01.11.22 at 11:41 am

“Persecuted” means by the government, with the power to throw you in jail or confiscate your property.

No, it doesn’t. Use a dictionary. If you meant political persecution through government, then you should have said as much.

No church can do that. No church can force you to be a member.

Parents often require their dependents to attend religious services ( I have no problem with that to a certain age). Because they are dependents, they have no say and in some cases it goes against their will (again, no problem IMO until about 12 years old). In the case of conversion “therapy” (it’s actually a kind of brain washing/torture) there have been countless cases where children were subject to attendance against their desires. This is an almost perfect example of persecution of homosexual people as a class.

The question at hand was whether there are any examples of conservatives persecuting others. There are. Frankly, true libertarianism (not the half arsed kind practised by most) is probably the only political alignment free of any or most persecution.

Anyhow, it’s PM in Pipestone County. G’night.

#56 Faron on 01.11.22 at 6:00 pm

#43 Linda on 01.11.22 at 5:12 pm

RIP Charlie, chest high & pretty in the snow.

Dogs + snow is a perfect combination in my opinion. Pretty much every dog I’ve known loves snow with a great passion (like myself). Given that, on average Canadian dogs get more time in the snow than say, US dogs; is it possible that Canada is the land of the happiest dogs of North America?

I have bias as a person living in the warm west. Perhaps dogs don’t get sick of the snow here but do in colder climes? Confounding factor is condition of working dogs in the north who live far different lives staked out on the ice all winter and out of town all summer. But, man, they get to run.

These are the hard-hitting topics that steerage was built for.

#57 Drew on 01.11.22 at 6:05 pm

The days of working for a company for 40 years and retiring with a nice pension and a gold watch is long long gone. Before Gen-Y had a name.

Why would they have loyalty for corps that will layout off hundreds when the books get too red. Loyalty is earned.

#58 DON on 01.11.22 at 6:08 pm

#19 Billy Buoy on 01.11.22 at 4:20 pm
#8 John

2 hikes of .25 each?

Watch out some people here who can see the future and are clairvoyant will be angry and will call you out on your educated guess..goes against the blog policy of free speech.

Just a warning from someone who agrees with you.

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

I am truly curious how your narrative plays out with the current state of affairs. Have you lived through higher inflation?

#59 Chinada on 01.11.22 at 6:19 pm

#34 Mehling on 01.11.22 at 4:47 pm
“Canada’s Quebec plans health tax for residents who refuse COVID-19 vaccine – premier”

https://gazette.com/news/us-world/canadas-quebec-plans-health-tax-for-residents-who-refuse-covid-19-vaccine—premier/article_0023534e-e67c-5cd4-81bd-a7b2f97689ad.html

Should ensure quick adoption, unless they’re already on the CERB / welfare.

I told ya it was coming. – Garth

—-

And just like that boys and girls.

Welcome to dictatorship.
Welcome to communist Canada.

Told you a few times democracies looked at China with envy.

We have arrived.

These are our leaders.

This is our country.

I guess I have to immigrate again.

And you thought it was going down hill when they took your flag down Garth. You ain’t seen nothing yet, baby.

#60 under the radar on 01.11.22 at 6:21 pm

So sorry about your dog.

#61 Chinada on 01.11.22 at 6:25 pm

DELETED

#62 THE DANDADA on 01.11.22 at 6:34 pm

UN-VAXED…. PAY-UP!!

OUCH!!!!!

https://abcnews.go.com/Health/wireStory/quebec-force-unvaccinated-pay-financial-penalty-82205073

#63 Reynolds753 on 01.11.22 at 6:39 pm

Oh yes, the early nineteen eighties: I remember them so well. I bought my first house in the east end of Toronto for the princely sum of $100,000 in 1981. My belief at that time was that it was the average TO home price. It was three stories, had a basement and was all of about 900 square feet. It did have a two car garage which was (and still is inthat area of TO) a big deal. I had to put up 25% for a down payment. The first mortgage that I could take over was an unbelievably low 11.5% that had about three years left until it came due. This was considered a big selling point. I had to get a second mortgage at 19% and you could only get it for six months. I remember renewing at 20%. At that time I had a mortgage calculator book that started at 10%. If and when interest rates rise those having to take out mortgages will be in for a surprise.

#64 I don’t know on 01.11.22 at 6:40 pm

#47 VladTor on 01.11.22 at 5:26 pm

Maybe not an industrial revolution in the traditional sense, but a incredible adaptation to the pandemic. All aided by advances in technology that have been happening over the past 25 years. The story of the economy in 2020/2021 is of incredible resilience and adaptation. Monetary policy is definitely part of that, but it’s only part of the story.

Regarding housing in the 80’s, the average person able to purchase the average home in a large city was a condition that existed only for a couple decades post ww2 in the western world. It was one of the only times in history that this was the case. There were hiccups for sure, but the balance of population to homes, availability of blue collar jobs, availability of land, lower cost of materials, much higher interest rates and overall different view of housing are all conditions that made it happen. All are long gone. This is only regarding the single family detached, which is what everyone wants, of course.

#65 Chinada on 01.11.22 at 6:54 pm

#62 THE DANDADA on 01.11.22 at 6:34 pm
UN-VAXED…. PAY-UP!!

OUCH!!!!!

https://abcnews.go.com/Health/wireStory/quebec-force-unvaccinated-pay-financial-penalty-82205073

—-

Yup. Canada has jumped the shark. Flipped. Done.

It doesn’t matter that this is illegal and will never happen. The fact that this tactic of threat is even being deployed shows you where we’re at. These ego maniacs we voted for have let the power go to their heads.

We’re on the other side now with this move. Bizarro Canada

Here is the funny thing…those who have money and are rich and stand by their conviction will pay this fine or tax and expense it.

Meanwhile, the poor get screwed. As usual.

Just like the poor get screwed with vaccine access. Poor countries that is.

https://www.unaids.org/en/resources/presscentre/featurestories/2021/october/20211021_dose-of-reality

https://www.independent.co.uk/news/health/covid-vaccine-poorer-countries-latest-doses-b1978215.html

#66 Chinada on 01.11.22 at 6:56 pm

#61 Chinada on 01.11.22 at 6:25 pm
DELETED

Was that too much bullshirt Garth? A little overly passionate, yes?

It happens. Forgive.

#67 westcdn on 01.11.22 at 7:08 pm

I leave my TV on and wander by. I saw a sitcom with a Nigerian doctor – never caught the name but it was funny. She sounded just like my doctor. I decided years ago I should have a doctor in my life. She was accepting patients. She is a tall thin Nigeran with a wicked accent.

She is mean and looks at me. You are diabetic and obese. What I say. I am going to place you on meds. I was not happy. Well, I dropped 60 pounds as time went by and the meds went down with it. Perhaps I wont need them in the future – I can always hope.

She makes me smile and I will make her happy. I can do nothing about the Alberta weather – may she stick around because she is good. I fear to lose her.

Now for my investing experience. Things are going very well for now. I am thinking I should sell a few things but first transfer in kind to my TSFA. $6,000 is not a lot but the capital gain is a happy problem.

Financials are not my favorite. I have been buying PIC.A just to diversify – a mutual fund, Garth will kick me. I also like SGR.UN – the w/h tax annoys me.

#68 Ponzius Pilatus on 01.11.22 at 7:12 pm

193 Faron on 01.11.22 at 1:02 pm
#181 Ponzius Pilatus on 01.11.22 at 11:53 am
Frankly, if more people spent a bit more time following their passions I can’t see how the world would be worse. Our host, Garth, seems to have lived such a life. Might turn out that a lot of people are passionate about the wellbeing and opportunity of others. Don’t ignore the costs of being/feeling like one is duty-bound especially if there’s a “should” in the line of thinking.
——————-
Sure, bring in Garth.
Major Suck Up.
My passion is the study of Philosophy.
Always wanted to teach it at an University.
But then a major physical handicap became an obstacle too much to overcome.
Had to make a living. Became an Accountant, haha.
Talked to a guy in a wheel chair once.
He said Rick Hansen had made life harder for him.
People’s attitude changed, like hey why can’t you be like him, rolling around the globe.
——————-
Growing up in Austria in an afterwar ghetto, we had a neighbour who had no legs.
We teased him, calling him a cripple.
As I grew older, I learned that he lost his legs, standing guard.
for the Nazi army in in the cold North Sea , somewhere outside of Norway.
I started to talk to him and apologized for my stupid adolescent antics.
He showed me his medals of bravery and heroism.
But he said he did not care for any accolades.
He was just happy to be alive.
Many of his buddies did not make it out alive.
Some people just get the short end of the stick.
That brings me to the average Canadian, who won the birth lottery.
Be grateful for what you have.
And stop whining.

#69 PastThePeak on 01.11.22 at 7:14 pm

#62 THE DANDADA on 01.11.22 at 6:34 pm
UN-VAXED…. PAY-UP!!

OUCH!!!!!

https://abcnews.go.com/Health/wireStory/quebec-force-unvaccinated-pay-financial-penalty-82205073
++++++++++++++++++++++++++++++

What about “un-jabbed” but fully recovered from Covid naturally? How is this person a menace to society? He/she has the same benefits as vaccination. Many studies say better (I think one that the CDC likes to use said not as good – typical).

There will be millions of Canadians who catch Omicron (and Delta) in this wave. Estimates – before the provinces cut back on testing in the last week – were 3-4x as many infections as confirmed cases. That means could be 100-200K per day now.

Many would be jabbed but not boosted – do they need a booster as well? Is that too much for their systems to handle?

Just ignore these millions with natural immunity and “other” them as unworthy of health care? Wow. You guys are quite the saints! Nothing makes me prouder to be a Canadian than listen to you bunch…/sarc

#70 Don Guillermo on 01.11.22 at 7:14 pm

I thought I was escaping the stress of the Covid world by “running away” (as some describe it) to Mexico and “following my dreams”. The pool was 3/4 through being retiled when the damn pool tile supply chain broke and put me 2 weeks behind schedule. Thankfully new tiles arrived this morning and Augusto is back to work. He and I are both happy. Hope to be back poolin’ by Sunday.

#71 Ponzius Pilatus on 01.11.22 at 7:23 pm

Talking about individual rights versus the commons.
The Jockowitch saga tells us that when you’re privileged, you can bypass restrictions that ordinary people can’t.
Just lawyer up, and clog up the courts.
I say to the Aussies:
Kick his sorry ass back to Serbia.

#72 Ponzius Pilatus on 01.11.22 at 7:30 pm

#58 DON on 01.11.22 at 6:08 pm
#19 Billy Buoy on 01.11.22 at 4:20 pm
#8 John

2 hikes of .25 each?

Watch out some people here who can see the future and are clairvoyant will be angry and will call you out on your educated guess..goes against the blog policy of free speech.

Just a warning from someone who agrees with you.

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

I am truly curious how your narrative plays out with the current state of affairs. Have you lived through higher inflation?
——————-
Yes, I did.
20% mortgage in the early 80s.
No big deal, cut down on non essentials for a few years and you come out stronger, lean and mean.
What does not kill us, makes us stronger .

#73 Arguing with antivaxers... on 01.11.22 at 7:34 pm

https://youtu.be/Dp0Bt2cbcc8

#74 Mattl on 01.11.22 at 7:38 pm

#49 SunShowers on 01.11.22 at 5:27 pm
#34 Mehling on 01.11.22 at 4:47 pm
“Canada’s Quebec plans health tax for residents who refuse COVID-19 vaccine – premier”

I told ya it was coming. – Garth

Given that we’ve run out of carrots, and are now debating what variety of stick to beat the anti-vaxers with, this one is my least favorite. Vaccine passports are one thing, as it’s not a right to go to a restaurant, concert, sports game, movie theatre, be admitted into a private building, etc.

But we’ve decided that healthcare is a right, and once you start making exceptions to exclude people, it makes it easier to exclude other people for other reasons. I bet a lot of people would agree with making smokers and alcoholics pay an additional healthcare tax (even though tobacco and alcohol are already massively taxed upfront as it is to offset their healthcare costs.) I think that’s a slippery slope.

It’s only a right if everybody has equal and unfettered access to it, even people who you think don’t deserve it because they squander it.

—————————————————————-

You get it.

This is essentially a version of two tiered healthcare. The folks advocating for the unvaxed to pay their own way may be the next to be denied HC. I mean, why should an ICU bed go to someone that smoked 2 decks a day for 30 years? Or the guy that spends his day drinking. Of anyone with a BMI over 30? Skiing is pretty dangerous, why should society cover a guy that crashes into a tree doing something so stupid?

Definitely fits in the category of careful what you wish for. And not sure people truly understand how slippery this slope is.

#75 Ed on 01.11.22 at 7:39 pm

Quebec should get the boot out of confederation. Please boot us Albertan’s at the same time.

#76 rknusa on 01.11.22 at 7:40 pm

Trudeau will save all homeowners from going under

from enforced deferral of mortgages to cash handouts I would not put anything past him

#77 VicPaul on 01.11.22 at 7:52 pm

#53 Shawn on 01.11.22 at 5:34 pm
P.S. Aloha… Maui is a lovely place.

*********

That it is…went with a girlfriend 38 years ago…should go back. The hibiscus-imbued air is enchanting.

MY Dog!! The nose-bleed level of golf precision that the top three finishers displayed at Kapalua (on Maui) this Sunday…good grief!! It was the Tournament of Champions…34 under par!!

Man, those guys are good!

M58BC

#78 yvr_lurker on 01.11.22 at 8:00 pm

A few months ago Garth had no issues or concerns with numbered companies buying up rental housing stock across the country. The argument was that this would provide better management than mom and pop operations. Seems like these numbered companies have found a weak link. Buy in New Brunswick where there are no rental controls and simply give the long standing tenants a 50% rent increase with a nice “thank you for your consideration note”. Although I think Kershaw and generation squeeze are out of their collective minds, these huge spikes in rents were completely predictable as I noted over the summer quoting several articles. This is something for Gov’ts at all levels need to put in bylaws to prevent such spikes.

https://www.cbc.ca/news/canada/new-brunswick/disability-pension-rent-increase-1.6310235

Garth is incorrect that this issue is a nothingburger.

A guy from Brampton bought the building. You have no idea what a ‘numbered company’ is, do you? – Garth

#79 Quintilian on 01.11.22 at 8:05 pm

Bank rate increases will be minuscule in Canada.

Wage pressures will be muted by the elevated immigration levels.

The higher prices of commodities will keep the CAD buoyant.

But above all, the BOC is a lap dog of the politicians, and the politicians will telegraph that they prefer inflation over higher rates.

#80 A01 on 01.11.22 at 8:13 pm

So Garth does this mean that finally the long awaited real estate reckoning is coming? Will prices finally come back to earth? I sure hope so.

#81 tc-contra on 01.11.22 at 8:29 pm

some commenters here saying the markets are ‘up’? Passive index investing – otherwise known as ‘bogleheads’ who keep buying cuz, you know, market only go up.
Meanwhile, there’s a record number of stocks that are below the 52 week high, but the popular indeces like SP500 and Naz, only a few megacaps are holding them up. When you look intelligently under the hood, we’ve been in a bear market since last spring. But I did say ‘intelligently’ – and who does that these days? I mean, judging from the anti-vaxx venom spewed by many, there are highly imbalanced individuals lurking. But they vote.
bTW Fauci is going down soon – perjury among other crimes. I will enjoy more than the crash in the Markets…maybe.

#82 Yuus bin Haad on 01.11.22 at 8:33 pm

Somebody’s trying to break into Australia? Crikey!

#83 DON on 01.11.22 at 8:35 pm

Didn’t lack of action by the Feds cause problems in the 1980s?

And then there is this…

“RBC’s McKay calls for ‘rapid action’ on rates to tame inflation.”

Now imagine how many votes can be lost due to not taming inflation as opposed to those lost because of a healthy correction in some stocks.

#84 novax djokovid on 01.11.22 at 8:40 pm

@#71 Ponzius Pilatus on 01.11.22 at 7:23 pm
Talking about individual rights versus the commons.
The Jockowitch saga tells us that when you’re privileged, you can bypass restrictions that ordinary people can’t.
Just lawyer up, and clog up the courts.
I say to the Aussies:
Kick his sorry ass back to Serbia.

I won’t go.
I’m entitled to my entitlements.
My mom said so.

#85 meslippery on 01.11.22 at 8:40 pm

1980 house 75k income 55k today 2022 house 1.1 million
family income needs to be 750k for same 1.5 times salary.
That’s $180.00 per hour each for a couple working 40hr weeks.
ln chess you resign if you can’t win. Ah the great resignation.

#86 Flop... on 01.11.22 at 8:42 pm

Ponzi on 01.11.22 at 7:23 pm
Talking about individual rights versus the commons.
The Jockowitch saga tells us that when you’re privileged, you can bypass restrictions that ordinary people can’t.
Just lawyer up, and clog up the courts.
I say to the Aussies:
Kick his sorry ass back to Serbia.

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

Ponz, you got it all wrong, let the Aussie show you how it’s done.

Apparently at the Novak Djokovic hearing someone accidentally showed some porn for a moment or two.

Good to see Djokovic is not the only one acting like a prick…

M47BC

#87 HUNGRY BEAR on 01.11.22 at 8:43 pm

Steve….. Charlie just looks like an angel. You know he’s in heaven.

Glod Bless.

#88 VladTor on 01.11.22 at 8:52 pm

#64 I don’t know on 01.11.22 at 6:40 pm

Thank you for comments about housing.

With other hard to agree with you….

…. but a incredible adaptation to the pandemic.

***********
I didn’t see real adaptation.

Here from Garth about “adaptation”….causing shortages of truck drivers who deliver goods and increasing business overheads. A dearth of computer chips reduced….

What about luck of containers to deliver goods and materials from and to China for instance? List “adaptation” like this too long….

Adaptation was only in virtual reality linked with internet. Internet worked during pandemic very well – no any interruptions.

#89 Midnights on 01.11.22 at 8:53 pm

DELETED

#90 crowdedelevatorfartz on 01.11.22 at 9:00 pm

To all you Canadians that think that “pay as you go” private Health Care is wrong.

Not to worry.

Canada now has “Pay if you DON’T go” Health Care…….

https://www.reuters.com/world/americas/canadas-quebec-working-plan-get-unvaccinated-residents-pay-up-says-premier-2022-01-11/

Imagine that.
Making Canadian pay because they DIDN’T use the health care system…..

Perhaps there’s hope for Private/public health care in Canada after all.

:)-

#91 Nonplused on 01.11.22 at 9:08 pm

#71 Ponzius Pilatus on 01.11.22 at 7:23 pm
Talking about individual rights versus the commons.
The Jockowitch saga tells us that when you’re privileged, you can bypass restrictions that ordinary people can’t.
Just lawyer up, and clog up the courts.
I say to the Aussies:
Kick his sorry ass back to Serbia.

—————————————

Of course, as always, there is the other side of the story. Djokovic had covid and recovered so he supposedly has “natural immunity” and doesn’t need to be vaccinated. Remember when that was a thing? That’s his argument. Why would you get vaccinated against something you are already immune to?

It wasn’t that long ago that part of “herd immunity” included people who had covid but recovered. How quickly we forget.

Anyway that is what the whole argument is about. Having recovered from covid means he was allowed in the country, but the rules keep changing. But haters gonna hate.

What’s gonna be slightly more interesting is how China is going to pull off the Olympics in the near future. Hockey, as I understand it, is already pretty much a forfeit. How many other events are going to be affected? And what of the billions China spent to host? What of the TV rights? Who’s going to be watching if their favorite athletes can’t get in? It’s a big mess and the Djokovic thing is but a foreshadowing.

Natural immunity is irrelevant when the law requires vaccination. Laws are universal, not selective. – Garth

#92 Sail Away on 01.11.22 at 9:26 pm

“Canada’s Quebec plans health tax for residents who refuse COVID-19 vaccine – premier”

I told ya it was coming. – Garth

——-

This is where the US healthcare system is superior: if you have the $, you get treated. It can’t be turned into a socialist shaming exercise.

#93 mike from mtl on 01.11.22 at 9:34 pm

To expand, yes this exactly the same sentiment my employer faces – manpower. There’s around a quarter to half shortage of manual employment compared to the normal times.

Thing is this is not normal times, that desperate segment willing to work for nothing is evaporating. Try all you can to import nearly indentured slaves is quarterly thinking.

Hopefully we can bust the 2000s everything bubble of endlessly cheap labour and transport. Crap off a Chinese barge is so done thankfully as it was never sustainable.

Housing at in this land needs to have a huge haircut, let’s see if reality meets real estate, but I doubt it.

#94 T-Rev on 01.11.22 at 9:39 pm

I report to the prez, and told him today that I’m not working for less than last year, which means 5% in inflation adjusted terms. Were pushing through price increases of 6-15% depending on market and product, averaging about 8%, and so am I for my services. We had record profits last year in my division…largely due to increased margins that we realized through targeting tough, high margin market segments. Time to reward the performance.

#95 Doug t on 01.11.22 at 9:49 pm

Just imagine what this country is going to look like in 20 years – LORDY LORDY

#96 Chaddywack on 01.11.22 at 10:15 pm

The 80s was also the end of Trudeau’s dad as PM. Hopefully the same happens here!

I can do without the mom jeans and big hair though.

#97 wallflower on 01.11.22 at 10:35 pm

#54 Another Deckchair on 01.11.22 at 5:47 pm
Back in the 80’s I went to my boss with charts of my salary, at that point had been up 12% yearly. Wanted another 12%. Boss said “if I give you 12% you will make more than me”.
========

1998 interviewed for a job that I just assumed paid ~$60K. I asked the President (the interviewer) the pay. He said ~$40K. I stood up, “Woops, I have to apologize for wasting your time. Very sorry. Did not realize the pay would be this low.” And I exited.

He called me the next day, “So you gonna take the job?” I said, nope. I added, I need more like $60K to take this job. He said OKAY.

Two years later, I learned that there was only one other employee getting paid that salary and nobody higher (but, a bunch of the sales dudes earned more in commissions). It was the Controller.
Of a group of about 75 employees!

I was shocked. I had zero accreditation, not an engineer, just an old B.A. … but I had chutzpah – and I did not even know I had THAT until that very moment in the interview!

#98 Ponzius Pilatus on 01.11.22 at 10:36 pm

#13 Dave on 01.11.22 at 4:16 pm
For my household I’m calculating inflation as roughly 15% for essentials. Is it a decent rule of thumb to double (or triple) the government inflation number to get a ‘real’ estimate?
———————
Dave,
Thank you for your informative post.
Can you please let us know how you came up with your numbers.
Mine are a little lower.

#99 Ponzius Pilatus on 01.11.22 at 11:00 pm

#94 Doug t on 01.11.22 at 9:49 pm
Just imagine what this country is going to look like in 20 years – LORDY LORDY
——————
I’ve been here now for over 40 years now.
Sure, it looks different.
More people who speak different languages and have strange customs.
I know quite a few of them.
But my, are they hard working, and glad to be here.
We need more people who appreciate what they have, rather than complaining about what the don’t have.

#100 TurnerNation on 01.11.22 at 11:06 pm

I don’t follow JP.
The posts here I always couch in economic terms – as this is a financial weblog.

— Cancel culture, all the old culture must go Comrades:

•MNP Ltd. in its capacity as Receiver has initiated a sales process closing on January 14, 2022 for the Aberdeen Recreational Center (“ARC”). The ARC is located in Aberdeen, SK (near Saskatoon) and contains a NHL sized hockey rink, 4 curling ice sheets, multiple tenants, tavern with VLT’s and a café and concession.

•HockeyShot Inc., a Mississauga, Ontario-based online specialty retailer of hockey training equipment, was placed in receivership on January 6, on application by Pivot Financial I Limited Partnership, owed approximately USD $1.1 million and CDN $2.5 million.

— Haha this cartoon is our lives these days. Well not in ON, QC where eating inside 4 walls is banned – for the 3rd year running. https://pbs.twimg.com/media/FI3ANtrXoA0gPVk?format=jpg&name=900×900

— Anyone see Hunger Games movie? I did not. Was it predictive?

https://www-cnbc-com.cdn.ampproject.org/v/s/www.cnbc.com/amp/2022/01/11/dominos-pizza-expects-soaring-food-costs-in-2022-backs-long-term-outlook.html
Domino’s Pizza is expecting “unprecedented” food-cost increases in 2022.
The company is forecasting an 8% to 10% jump in its food basket costs, three to four times the inflation for a typical year, CEO Ritch Allison said.

#101 J. Morris on 01.11.22 at 11:08 pm

Just had work done on my SUV in Parksville BC. Replace left wheel bearing: [potholes galore]
Labour:3 hrs~$357. 50~ Parts~$202.37~Tax~$67.18 ~Total $627.05 Wow! talk about inflation,I used to wake up feeling like a million bucks now a days more like a bounced cheque.

#102 Reddy on 01.11.22 at 11:18 pm

Lotsa talk about interest rates and house prices falling. Thought I’d share that nearly everyone I speak with has old money coming to them. Millions in old money. This is the difference and a key as to why we won’t see falling prices. The old money is just waiting to get inherited and spent

#103 Ponzius Pilatus on 01.11.22 at 11:27 pm

#91 Sail Away on 01.11.22 at 9:26 pm
“Canada’s Quebec plans health tax for residents who refuse COVID-19 vaccine – premier”

I told ya it was coming. – Garth

——-

This is where the US healthcare system is superior: if you have the $, you get treated. It can’t be turned into a socialist shaming exercise.
————————-
I don’t think that there is any empirical evidence about which health system is superior.
It pretty much depends on the individual circumstances.
But one thing is for sure, if you got the money, you’re better off in the States.
But, if you got money, you’re always treated better, no matter where.
Just ask Jokowitch.
Personally, Me and my family have been very well treated under the Canadian Health Care system.
Sure I had to wait a few times in the emergency, but I realize hospitals are staffed for average conditions, and sometimes there are more cases than normal, and the gotta triage.
The only experience that I had with the American Hospital System was in Hawaii when I had a minor injury that I had to be looked after.
Waited 2 hours for a Dr., who bandaged me up and gave me a prescription for painkillers.
I had extra insurance, and I found out later that they charged $ 3500, and after some negotiations the Insurance company paid $2,800.
It’s a game of chicken.
I just like it, when I can go to my Doctor or hospital, without worrying about the cost.

#104 Michael in-north-york on 01.11.22 at 11:37 pm

An extra health tax on the unvaccinated is slightly less opressive than an outright mandate.

But it won’t be very effective. They can’t tax anyone retroactively for 2021, when the rule wasn’t in place. The start date can be set for early 2022, but all reporting will occur in the Spring 2023.

If Covid is no longer a health emergency by that time, then the justification for the extra tax falls apart. Taxpayers will sue the government and will win.

If Covid is still an emergency, then people notice that they are hit by a new tax, and maybe some hesitants will choose to take a vaccine. So, any meaningful change in behavior will only occur 14 months from now.

#105 willworkforpickles on 01.11.22 at 11:38 pm

Those next 3 interest rate hikes incoming will keep the markets afloat until late 2022, but by then will prove to be too little too late to prevent a market crash.
Too little too late in that 3 minuscule quarter point hikes won’t put a dent in rising inflation and the market will anticipate much higher point hikes looking ahead.
The anticipated interest rate hikes now will work/are working just enough to prop up the markets with a dis-inflationary smokescreen the market needs to stay afloat, but as the year rolls on and inflation shows no sign of receding, more rate increases with higher quarterly point rises perceived incoming to actually get inflation under control will blow the market up.
For now, the phony baloney Fed illusion of dis-inflationary measures being taken with a few smallish rate increases will have to suffice as the Fed is out of options.

#106 DON on 01.11.22 at 11:50 pm

#100 J. Morris on 01.11.22 at 11:08 pm
Just had work done on my SUV in Parksville BC. Replace left wheel bearing: [potholes galore]
Labour:3 hrs~$357. 50~ Parts~$202.37~Tax~$67.18 ~Total $627.05 Wow! talk about inflation,I used to wake up feeling like a million bucks now a days more like a bounced cheque.

*******

Yikes!

Try Arrowsmith automotive in Qualicum.

Did you go to Ok or Sidney Tire or the automotive place in the industrial park?

#107 Bubble Bubble more Trouble on 01.11.22 at 11:54 pm

Let’s hope Powell and company can engineer a soft landing. They are in a very tight spot.

#108 Shawn on 01.11.22 at 11:56 pm

Vic Paul 76

Kapalua golf? Ya I was there Sunday to see the final round. Not very crowded. Staying at kapalua resort. Thanks stock market!

#109 april on 01.11.22 at 11:56 pm

#65 – read the Charter of Rights and Freedoms.

#110 april on 01.12.22 at 12:15 am

#39 – Project Veritas is a “questionable source. “… mixed factual reporting”. Media/Bias Factcheck.

#111 Michael in-north-york on 01.12.22 at 12:24 am

The European Medicines Agency (EMA) suggested that going forward, Covid booster shots may be offered annually, “synchronising them with the start of the cold season in the way that flu vaccines are currently administered”.

But not every few months.

https://www.france24.com/en/live-news/20220111-omicron-pushing-covid-out-of-pandemic-phase-eu-agency

This is not too bad. Especially, if combined Covid + Flu vaccines can be designed. Two pathogens, but only one injection in the middle of the fall.

#112 Shannon Fong on 01.12.22 at 12:27 am

Bank heads hammer Trudeau/Tiff for under reporting inflation, over reporting job creation and outright lying on rate management.

https://www.bnnbloomberg.ca/rbc-s-mckay-calls-for-rapid-action-on-rates-to-tame-inflation-1.1706209?utm_campaign=trueAnthem%3A+Trending+Content&utm_medium=trueAnthem&utm_source=facebook

Tiff wants you to think inflation is kept low by imported Chinese T Shirts. But we know inflation is running hot at 30++% semi annually. Housing up 40%. Food up 50%. Who cares about Trudeau fudging on gas prices towards $2 bucks a liter.

Anyone supporting Trudeau hates Canada. Calling an enemy a hero is a signal that your democracy is being stolen.

#113 Tomás de Torquemada on 01.12.22 at 12:36 am

The market reaction to Fed’s interest rates talks shows that there will be no real meaningful increase.

With the current level of debt that is not possible, in the 80-es debt was 4 times lower.

I am hearing about that increase since 2008-2009, i.e. almost decade and a half and nothing happened except that assets exploded in price with economy stagnating.

If economy was in a good shape, rates should have been higher than inflation, i.e. 15 % + currently.

It is just talk, a bluff from professional con men, whose credibility is rapidly diminishing.

So a house in the 80-es in Toronto was 20 times cheaper than now with wages 2 times lower?

What a great progress in the standard if living indeed.

More to come, so brace up.

The adjustment of inflation calculation to report fake numbers all these years clearly shows that all this monetary policies were planned in advance.

In the 80-es there were no assets purchasing ‘liquidity’ programs.

This is just starting, Inflation will go unchecked for a very long time, some hybrid program with slightly higher rates (max 1.5%) and continuous asset purchases will take place as no sane person will buy bonds yielding 10 % + real negative rates.

7 % official inflation! And they take about ‘potential’ rate increases to 1 %…. wow, the guts these lairs have.

#114 Doug t on 01.12.22 at 12:39 am

#98 ponzi

Okey dokely lol

#115 Tomás de Torquemada on 01.12.22 at 12:43 am

5 % inflation in Canada was the real joke of the year. With houses – half of the living expenses increasing 25 % if nothing else increased, it would have been 12.5 % honest inflation reported.

But food, energy increased dramatically as well, 15 % would have been a low reading for real inflation for the last year.

With rates at 0, government indexed benefits of 2 %.

And the ‘economy’ is all good, more of this to come in the next decade – decade and a half.

#116 Canadian Moose on 01.12.22 at 12:43 am

RIP Charlie, God Bless ya!

#117 bdwy on 01.12.22 at 1:37 am

#100 J. Morris on 01.11.22 at 11:08 pm
Just had work done on my SUV in Parksville BC. Replace left wheel bearing: [potholes galore]
Labour:3 hrs~$357. 50~ Parts~$202.37~Tax~$67.18 ~Total $627.05 Wow!

if you make 90k pretax you must spend 2 full days in day jail to pay for it.

or
30 second search….”Front hubs on a RWD vehicle are pretty easy. Remove wheel, caliper, rotor, undo bolts holding hub to knuckle, remove hub. If you live in the rust belt it can take a bit of effort to separate the hub & knuckle, so use plenty of penetrating fluid.”

some very basic tools and a bfh (big f-ing hammer)
120 bucks from amazon for part and maybe and hour or 2 if you go realllly slow.

1.5 fewer day jail days reqd.

#118 Faron on 01.12.22 at 1:47 am

Long time since we heard folks piping the gold narrative…

#119 Nonplused on 01.12.22 at 2:24 am

“Natural immunity is irrelevant when the law requires vaccination. Laws are universal, not selective. – Garth”

Well, true. But the messaging at one time was that natural immunity was a thing that happened and worked. Why was it not included in the law? Or did we get new information that it didn’t work?

If natural immunity works and is a thing, a law requiring those who have it to get unnecessary vaccinations seems a bit over the top. The sort of thing the courts should throw out.

But anyway it is Australia and I suppose they can do as they please. But there will always be a footnote. Whoever wins the tournament will have an asterisk after their name that says “*Novak Djokovic probably would have won if he was allowed to compete.”

#120 Billy Burnes on 01.12.22 at 3:50 am

Garth, have you forgotten the massive recession starting in 1980? You couldn’t get a job . Thousands turned up for wait jobs ads. Vanc’s fancy shopping Robson St was boarded up. You could fire a cannon down Granville. Everything got mean.

House prices fell 50% for a decade and more. By 88 T-Bills paid 14%. CSBs hit 18% for a 5 year. EI offices put up bullet proof glass . What started in 1980 got worse. Many called the winter of 82/83 ‘ the great darkness.’ Things didn’t pick up in RE until ‘92. It was a decade long as slicking for anyone with a mortgage.

Nasty decade except for the VSE, gold miners and rocks were trading on fire.

#121 Big Bucks on 01.12.22 at 6:16 am

In 1980 minimum wage was $2.65/hr x 35 hours=$98.00 week or $4800 a year so I don’t know what family’s were pulling down $55,000.00 a year.

#122 crowdedelevatorfartz on 01.12.22 at 8:12 am

@#119 Big Bucks
“… in 1980 the family income was around $20,000 and in many cases a lot less.”

+++++

Where were you living ?
Eastern Germany?

#123 crowdedelevatorfartz on 01.12.22 at 8:22 am

@#111 Shannon Fong

Interesting article and 100% correct.
Unfortunately Trudeau and his merry band of lickspittles won’t do anything about inflation until they are forced to.
They will follow the US rate rises.
It’s easier to blame “outside market forces” than to admit their hideously expensive profligate CERB policies were wrong and have condemned Canada to decades of tax increases and govt cuts.

Another article about repeated Booster shots also raised a good point…

https://www.bnnbloomberg.ca/repeat-booster-shots-spur-european-warning-on-immune-system-risks-1.1706083

#124 IHCTD9 on 01.12.22 at 8:31 am

#116 bdwy on 01.12.22 at 1:37 am
#100 J. Morris on 01.11.22 at 11:08 pm
Just had work done on my SUV in Parksville BC. Replace left wheel bearing: [potholes galore]
Labour:3 hrs~$357. 50~ Parts~$202.37~Tax~$67.18 ~Total $627.05 Wow!

if you make 90k pretax you must spend 2 full days in day jail to pay for it.

or
30 second search….”Front hubs on a RWD vehicle are pretty easy. Remove wheel, caliper, rotor, undo bolts holding hub to knuckle, remove hub. If you live in the rust belt it can take a bit of effort to separate the hub & knuckle, so use plenty of penetrating fluid.”

some very basic tools and a bfh (big f-ing hammer)
120 bucks from amazon for part and maybe and hour or 2 if you go realllly slow.

1.5 fewer day jail days reqd.
___

Depends a lot on the vehicle too. We had an 02 Elantra, and the rear wheel bearings were cake. 2 bolts to pop the caliper off, disk just slides off the wheel studs, and 1 pc 32mm (IIRC) nut to free the wheel bearing from the “spindle”. The new bearing was 95.00. Half hour job.

The Mazda 3 we have now is a lot more difficult, 4 bolt design, thru bolt holes so the exposed ends of the bolts that have to go back thru the threaded hole are all crusty. Piloted design that rusts solid to the carrier, so get out the little 3lb mallet because there’s nowhere to swing the BFH. Easy 2 hr job and the new hub was expensive too because the wheel speed sensor is part of the assy.

#125 Wrk.dover on 01.12.22 at 8:46 am

FWD bearings are in an enclosed hub assembly with the ABS sensor in it, so priced according to price of car $ or $$ or $$$,

The labor is in racking the car, removing the wheel, the caliper (two bolts ), the ABS wire jack, then removing big nut on the axle the lower control arm nut.

A no skill job, an hour is plenty of time, in an equipped shop.

RWD front bearings come out of the rotor hub, cost $20ish/inner and outer pair, have to be hand packed with grease, and properly set up with preload on the spindle nut. It’s a skilled dirty work job though. Lower part cost, higher labor/time cost.

Avoid owning expensive cars off warrantee! If you do, steer clear of the dealer for parts or service.

Good luck owning an off warrantee Tesla, YIKES!

#126 bdwy on 01.12.22 at 9:29 am

Avoid owning expensive cars off warrantee! If you do, steer clear of the dealer for parts or service.

—————————-
Mon Dieu do i love GM products for this reason.

On our bulletproof and butt ugly cavalier the hub is 48$, but it never breaks down so i’ll likely never get the chance even though it’s smashed plenty potholes and mexican topes.

—————————-
7% as expected.

Supply chains will take longer than a quarter or 2 to untangle keeping inflation hot and forcing JP’s 4 moves.

Growth (still puffed up) stonks will continue the month long underperformance relative to financials and anything with an actual p/e.

BRK.b has been on fire during the recent tech spanking.

#127 Mark on 01.12.22 at 9:30 am

At least I’m with the majority. After a three year wage freeze we were gifted a 1% raise in a mass email. To which the boomer members of the senior management team replied-all to thank our dear leaders for their generosity. And you wonder why non-boomers have no corporate loyalty?

As for the eighties, those inflation rates came at a very different time in economic history. Most notably before the BoC had a rate target. I assume Tiff and the gang will need to start cooling the economy. Fearing inflation is a self fulfilling prophecy. But do remember Garth, last years inflation was near zero. If you annualized the last two years, inflation is closer to 2.5% which is within the banks monetary target. I never expect much data literacy from you, but this is likely the economy catching up to slack within it. Though with every media outlet and blog pumping high inflation it will likely persist without intervention from the bank.

Last year we were coming off a recession and had two quarters of negative GDP. The catch-up has been remarkable, but also reflects inflationary pressures in Europe, the UK and the US. Labour market conditions alone, apart from the supply chain woes and real estate speculation, dictate CB action. Try not to be ageist, by the way. Makes you sound whiny and appear inconsequential. – Garth

#128 IHCTD9 on 01.12.22 at 9:30 am

#94 Doug t on 01.11.22 at 9:49 pm
Just imagine what this country is going to look like in 20 years – LORDY LORDY
___

It’ll be a mess. Fully divided and conquered society, zero culture, massive cost of living, garbage quality of life, job market stuffed to the max, wages going nowhere fast. We’re literally racing towards it since Trudeau took the helm.

That will persist until newcomers decide other countries offer a better deal. That day will arrive when the USA reforms their immigration system to be more like ours. Best get retired and collect before then.

#129 Goldfinger on 01.12.22 at 9:58 am

#117 Faron on 01.12.22 at 1:47 am
Long time since we heard folks piping the gold narrative…

—-

If this trajectory for democracies keeps up soon you’ll get your wish where only two things matter.

Pure blood and gold! HA HA HA!

#130 Chinada on 01.12.22 at 10:02 am

#108 april on 01.11.22 at 11:56 pm

#65 – read the Charter of Rights and Freedoms.

^^^^

Aren’t our rights and freedoms suspended right now?

Don’t wrap yourself in a piece of paper with words on it thinking it will protect you. That fact has been made perfectly clear.

Garth wrapped his building in the Canadian flag, and we all know how that ended.

#131 Big Bucks on 01.12.22 at 10:25 am

#121

The facts are what they are and the poverty level in Canada was $8400 in 1980.Not many made $55000 in 1980(or families)as even teachers made about $15-$18,000 and minimum wage workers barely grossed $5000 a year.42 years ago is a long time ago and it was a different word.House prices were about 3 times the family income and of course now it 6-7 times ,maybe even higher in big cities.

#132 the Jaguar on 01.12.22 at 10:26 am

NP snippet. Feds planning to review possible increase in down payment on investor purchases. Note they haven’t a clue how to enforce it. Reminds me of their sweeping statement that all international travelers returning to Canada would be Covid tested. That hasn’t happened either. This Liberal government has no brain power whatsoever. They couldn’t punch their way out of a wet paper bag. Meanwhile back at the ranch, we welcome huge annual immigration numbers where statistics show many purchase a house within 12 months of arrival. No scrutiny on where the money comes from for the down payments. That would be impolitic and is too delicate a subject to approach. Read this and weep:

” The Federal government is planning to review the rules surrounding down payments on investment properties in a bid to curb speculation in red hot housing markets, with increases in the down payment or restriction on the source of funds the most likely measures it might pursue, according to industry experts.

The review was one of a series of measures to combat soaring housing prices laid out within the Fairness in Real Estate Action Plan in the mandate letter from Prime Minister Justin Trudeau to Ahmed Hussen, the minister responsible for housing, in December.

They had no further details on what the down payment review for investment properties could look like at this time.

“A sudden influx of investors in the housing market likely contributed to the rapid price increases we saw earlier this year,” Beaudry said in a speech to Ontario’s securities watchdog. “In such a case, expectations of future price increases can become self-fulfilling, at least for a while. That can expose the market to a higher chance of a correction. And, if one occurs, the damage can spread far beyond the investors.”.

“Damage from a housing sell-off can drive the whole economy into recession if it’s severe enough, given the wealth and liquidity of millions of Canadians’ are tied to their home value,” Mclister said.IF YOU LOOK AT EVERY SPECULATIVE HOUSING BUBBLE IN HISTORY, THEY’RE DRIVEN BY INVESTORS.Mclister added that he suspects regulators might also curb the use of borrowed money (such as from HELOCS) to fund down payments for rental properties.”

“If you look at every speculative housing bubble in history, they’re driven by investors. Even cities with the most elastic supply, meaning the housing markets could easily respond by building more … no matter how much supply they build, it didn’t prevent a housing bubble,” he added. “When the mood is very exuberant, you can’t build fast enough.” (John Pasalis)

#133 Sønar Gents on 01.12.22 at 10:36 am

I think I liked Dolce Vita better Søren Angst.

You thinking of going back?

Or like Sex in the City, you’re going to take a break, then make a triumphant return and Vita of Dolce?

#134 crowdedelevatorfartz on 01.12.22 at 10:37 am

@#126 mark
“After a three year wage freeze we were gifted a 1% raise in a mass email. To which the boomer members of the senior management team replied-all to thank our dear leaders for their generosity.”

+++

Well.
Don’t blame the Boomer lickspittles in senior mamangement…. Thats how they got there.
I’m sure there are plenty of Mills aiming for their jobs, they just have to practice slathering on the chapstick.

As for complaining about your measly 1% increase after 3 years of slaving in the salt mine…..
Leave and go somewhere else if your skillset is in high demand.
Or completely change careers.
Plenty of jobs out there unlike the high inflation, high interest rate, high unemployment of the 80’s.

I remember working then and now and now is definitely better for job searching….. unless you have zero job skills and are too scared to move.
I understand.
It is easier to whine and blame others.

#135 Slim on 01.12.22 at 10:45 am

As for Quebec Premier François Legault imposing a health tax on the vaccine refuseniks; I believe is not much different than how insurance companies operate.

The higher the risk, the higher the premiums.

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

#136 IHCTD9 on 01.12.22 at 10:46 am

#124 Wrk.dover on 01.12.22 at 8:46 am

RWD front bearings come out of the rotor hub, cost $20ish/inner and outer pair, have to be hand packed with grease, and properly set up with preload on the spindle nut. It’s a skilled dirty work job though. Lower part cost, higher labor/time cost.
___

It’s been a long time since I did tapered roller bearings into a brake disk. I’m not sure they do them like that anymore. Even my 19 year old 3/4 ton (2wd) has bolt on 8 stud hubs for the front.

https://www.moog-suspension-parts.com/moog-515086

My guess is once ABS ended up on all cars, wheel bearing hub assemblies came along with them.

#137 SoggyShorts on 01.12.22 at 11:02 am

#49 SunShowers on 01.11.22 at 5:27 pm
Slippery slope/whataboutism.

But yeah, if you insist: smokers and overweight people paying more *could* happen, and IMO that’s fine.

This ignores the fact that being fat isn’t contagious but whatever.

#138 SoggyShorts on 01.12.22 at 11:10 am

#118 Nonplused on 01.12.22 at 2:24 am
“Natural immunity is irrelevant when the law requires vaccination. Laws are universal, not selective. – Garth”

Well, true. But the messaging at one time was that natural immunity was a thing that happened and worked. Why was it not included in the law? Or did we get new information that it didn’t work?

If natural immunity works and is a thing, a law requiring those who have it to get unnecessary vaccinations seems a bit over the top.
****************************
With so many falsely claiming “it’s just the flu” for the past 18 months, encouraging reckless selfish behavior would be unconscionable and they’d be much worse off.

Also, the term “natural immunity” is a trick. It makes it sound like getting sick is the Certified Healthy Organic choice.
“Recovered” and “Lucky” and “Hopefully not a long-hauler”
are more honest terms.

#139 Sail Away on 01.12.22 at 11:11 am

@Faron, a quick update on my August 19 mining positions in BHP, LIF, NTR and VALE since you seemed a bit fixated on them:

Currently +7% total return, 9% avg div going forward. Physicist took a position at the same time in XBM, and that is currently +22% with 0 div.

That’s the way it is with the volatile stuff. Buy the dip, but sometimes it keeps dipping and needs to be ridden out. No complaints on my side.

#140 Not Fooled on 01.12.22 at 11:12 am

#127 IHCTD9 on 01.12.22 at 9:30 am
#94 Doug t on 01.11.22 at 9:49 pm
Just imagine what this country is going to look like in 20 years – LORDY LORDY
___

It’ll be a mess. Fully divided and conquered society, zero culture, massive cost of living, garbage quality of life, job market stuffed to the max, wages going nowhere fast. We’re literally racing towards it since Trudeau took the helm.

That will persist until newcomers decide other countries offer a better deal. That day will arrive when the USA reforms their immigration system to be more like ours. Best get retired and collect before then.

**********

Another argument, if anyone needs one, for turning one’s tax free housing windfall into a fat portfolio.

We sold and retired during the 2017 YVR RE peak, and our portfolio went from essentially zero to 7 figures overnight. Because capital gains, though respectable, haven’t had years to accrue our income is mostly return of capital at this point.

We pay near zero capital gains tax and declare an embarrassingly low taxable income.

The ratio of roc to cap gains will change over time, but we’re taking full advantage of the current favourable conditions.

#141 Ponzius Pilatus on 01.12.22 at 11:15 am

#127 IHCTD9 on 01.12.22 at 9:30 am
#94 Doug t on 01.11.22 at 9:49 pm
Just imagine what this country is going to look like in 20 years – LORDY LORDY
___

It’ll be a mess. Fully divided and conquered society, zero culture, massive cost of living, garbage quality of life, job market stuffed to the max, wages going nowhere fast. We’re literally racing towards it since Trudeau took the helm.

That will persist until newcomers decide other countries offer a better deal. That day will arrive when the USA reforms their immigration system to be more like ours. Best get retired and collect before then.
—————————
I hear motor homes are on sale now.
Get them while they last.

#142 XGRO and chill on 01.12.22 at 11:17 am

Garth the Oracle calls it! US inflation at 7%! The highest since 1982 / 40 years ago!

https://www.businessinsider.com/inflation-december-cpi-price-growth-index-supply-chain-economic-recovery-2022-1

#143 Lt. Commander Data on 01.12.22 at 11:17 am

Ontario Hospital Covid data shows:

1813 fully vaccinated hospitalizations
163 partially vaccinated hospitalizations
674 non vaccinated hospitalizations

167 fully vaccinated ICU
19 partially vaccinated ICU
157 non vaccinate ICU

Better take down this data reporting Ontario. It is not helping any policy, passports, narratives.

And when data becomes a liability to the narrative, data must be removed.

Real Estate frankenumber has shown what is possible. Everyone wants in on the trend.

50% of ICU coming from 20% of the population? Vaccines work. – Garth

#144 Dharma Bum on 01.12.22 at 11:20 am

#196 Shawn (from yesterday)

You lost me at Milk and probably lost all credibility and self-identified as a “nutter” in the minds of most people.
————————————————————————————————————

The promotion of milk consumption for “health” is a creation of the dairy boards. Milk is not healthy. It is fattening.

Human consumption of milk beyond infancy is unnatural and freakish.

“The current U.S. dietary guidelines recommend that just about everyone eat three servings of dairy a day.

Now, in a new review, Walter Willett, MD, DrPH, a professor of nutrition and epidemiology at the Harvard T.H. Chan School of Public Health, and his co-author, David Ludwig, MD, PhD, a professor of pediatrics and nutrition at Harvard, say the science behind those dietary recommendations is thin. And they say eating too much dairy may cause harm to both our bodies and the planet.

“If we’re going to recommend something, it obviously should be based on strong evidence,” says Willett. He reviewed the risks and benefits of drinking milk for The New England Journal of Medicine.

“The basis of calcium recommendations is, I think, fundamentally flawed in the United States,” he says.

He’s not the only one who feels that way.”

https://www.webmd.com/diet/news/20200214/rethinking-mik-science-takes-on-the-dairy-dilemma

Milk consumption is a major cause of childhood obesity.

https://nutritionfacts.org/2017/03/16/how-milk-may-contribute-to-childhood-obesity/

Besides, milk is just gross. Gag me with a spoon. Fer sure.

https://www.pcrm.org/good-nutrition/nutrition-information/health-concerns-about-dairy#:~:text=Milk%20and%20other%20dairy%20products,%2C%20ovarian%2C%20and%20prostate%20cancers.

#145 VladTor on 01.12.22 at 11:22 am

Garth….On Wednesday the American number is expected to come in at 7%.

***************
It is here!!!!

https://www.bls.gov/news.release/cpi.nr0.htm

Inflation that has not yet reached the market, but already recorded by manufacturers reach 26.5%, this is what “will come to stores tomorrow”

https://www.bls.gov/ppi/

#146 I See You on 01.12.22 at 11:23 am

Anyone else find it disturbing that in Ontario and Quebec these numbers of 500 and 250 in ICU are crushing the system?

You take that into population and we’re talking about a crazy small number of 3 ICU beds per 100,000 population.

This is crazy.

Look at this:
https://en.wikipedia.org/wiki/List_of_countries_by_hospital_beds

Japan has 13.5 per 100,000
Russia has 8.3 per 100,000
Germany 38.7 per 100,000

Canada is reporting 13.5 per 100,000 – which begs the question, how the heck is 3 per 100,000 with these small 250 (PQ) and 500 (ON) number taking down the system?

This is either a total deception/lie or the 13.50 per 100,000 stat is a lie. Which one is it Health Canada?

#147 yvr_lurker on 01.12.22 at 11:32 am

A guy from Brampton bought the building. You have no idea what a ‘numbered company’ is, do you? – Garth
—-
Whether it be some individual setting up a numbered company, an REIT, a hedge fund, or corporations seeking to increase their purchases of the rental stock (i.e. what is going on in Whitehorse), it comes with real concerns in my view. The new owners (based in Ontario) who purchased in NB will likely seek to quickly establish the same rents that one would find in Ontario. With no rent controls in NB the “inverstors” can easily raise the rates with little pusback since in smaller towns the rental stock is more limited. This is where Gov’t controls are needed.
The Gov’t in the Yukon realized this recently by establishing rent controls

https://yukon.ca/en/news/residential-rent-increases-yukon-be-indexed-inflation

It looks like NB will need something similar as well.

The idea from investors of rent parity across the country does not extend to wage parity. Many employers have the mindset that if you are working for them remotely in a WFH situation, then no matter how well you do in your job, your pay needs to be decreased to the level of the typical pay in your new location. Why is this done? Because they make the rules.

This is why everyone one needs to develop and refine skills at their jobs so that they can attractive to other employers who care more about performance. With high level skills you can make the jump.

#148 Novax Djokovid on 01.12.22 at 11:32 am

My goodness, are Australias bitter.

Novak has exposed how ridiculous the whole thing is.

What is Novak guilty of? Being healthy – that’s what!

#149 All lies and manipulated u decide on 01.12.22 at 11:40 am

Garth the inflation hedge continues to rocket.

https://ca.finance.yahoo.com/news/canadian-luxury-real-estate-shatters-records-in-2021-sothebys-144714480.html

Good for a 7 digit increase for me on my assessment’s.
Does is blow up? I don’t believe so…like flat to moderate decline but god knows when…I bet not this year. Happy 2022!

Do you believe every press release from real estate marketing companies? – Garth

#150 Ponzius Pilatus on 01.12.22 at 11:40 am

Skip the Dishes in China

https://www.spiegel.de/ausland/china-mit-ersten-omikron-faellen-dritte-millionenstadt-im-corona-lockdown-a-22059452-da8b-430d-b893-5c361d07b826

#151 Sail Away on 01.12.22 at 11:48 am

#126 Mark on 01.12.22 at 9:30 am

At least I’m with the majority. After a three year wage freeze we were gifted a 1% raise in a mass email. To which the boomer members of the senior management team replied-all to thank our dear leaders for their generosity.

———

I would wonder about company profitability and whether the company has been in dire straits the last three years, since without revenue, a company can’t increase wages, and company survival trumps staff happiness. A wage freeze is first, then comes reorg and the ax. A wage increase seems like a decent sign.

Contrary to the belief of some, not all companies have done fantastically well in the last couple years. Maybe they are hoping some staff will decide to leave voluntarily.

#152 WTF on 01.12.22 at 11:51 am

#102 PP “I don’t think that there is any empirical evidence about which health system is superior.”

Maybe not, but there are comparisons that certainly show some significant differences.

Perhaps Austria (9) to Canada (30)? Not the US (37) which has a worse rating than Canada, In spite of the fact both the US and Canada spend more per capita than ANY other country.

We have a balkanized system with politicians as gatekeepers who don’t have the courage or expertise to challenge the status quo of a slowly disintegrating system nobody else on the planet has, except North Korea…………..

https://www.internationalinsurance.com/health/systems/

#153 IHCTD9 on 01.12.22 at 12:00 pm

#98 Ponzius Pilatus on 01.11.22 at 11:00 pm

We need more people who appreciate what they have, rather than complaining about what the don’t have.
____

No, we need more people to insist that future Canadians have it at least as good as they did when it was their turn to build a life in Canada.

Houses have doubled since Trudeau took office. Debt has doubled since Trudeau took office. Inflation has more than tripled since Trudeau took office. Taxes will soar eventually too.

#154 Quintilian on 01.12.22 at 12:02 pm

#127 IHCTD9
“It’ll be a mess. Fully divided and conquered society, zero culture, massive cost of living, garbage quality of life, job market stuffed to the max, wages going nowhere fast. We’re literally racing towards it since Trudeau took the helm.”

IHCTD9, you are describing most of the developed economies.
You lost me at “Trudeau took the helm”

The truth of the matter is, that many years ago, Greenspan embarked on a Frankenstein style monetary experiment.

It proved too addictive for politicians to break the habit.

We will have to hit bottom, before we admit to the real cause of the problem.

#155 Bubble Bubble more Trouble on 01.12.22 at 12:02 pm

Garth,

Tiff must have read your blog.

#156 Faron on 01.12.22 at 12:26 pm

Last year we were coming off a recession and had two quarters of negative GDP. The catch-up has been remarkable, but also reflects inflationary pressures in Europe, the UK and the US. Labour market conditions alone, apart from the supply chain woes and real estate speculation, dictate CB action. Try not to be ageist, by the way. Makes you sound whiny and appear inconsequential. – Garth

W/re the labour market, I’ve seen similar data. If you want a sense of where CB set rates are headed there’s a great chart comparing wage growth rates to interest rates through time. They are highly and positively correlated. Latest data show wages ramping hard and into a range where CB rates are several hundred basis points higher. CBs rates will have to catch up very quickly here.

Again, where are all the muhflation gold (AKA Boomer Bitcoin) bugs? We have inflation now. It’s in the data yelling at us, but crickets (different kind of bug). You don’t mean to say that the 2020 gold ramp was just a speculative frenzy where a narrative was formed to justify the buying do you? I’m actually thinking this is a gold bottom, but it needs some gold bug buzz. Let’s go!

#157 Faron on 01.12.22 at 12:28 pm

#127 IHCTD9 on 01.12.22 at 9:30 am

Zero culture is a bit dramatic. Where there are humans, there is culture full stop. Arguably, tough times breed culture because socializing is free.

#158 KLNR on 01.12.22 at 12:37 pm

@#102 Ponzius Pilatus on 01.11.22 at 11:27 pm
#91 Sail Away on 01.11.22 at 9:26 pm
“Canada’s Quebec plans health tax for residents who refuse COVID-19 vaccine – premier”

I told ya it was coming. – Garth

——-

This is where the US healthcare system is superior: if you have the $, you get treated. It can’t be turned into a socialist shaming exercise.
————————-
I don’t think that there is any empirical evidence about which health system is superior.
It pretty much depends on the individual circumstances.
But one thing is for sure, if you got the money, you’re better off in the States.
But, if you got money, you’re always treated better, no matter where.
Just ask Jokowitch.
Personally, Me and my family have been very well treated under the Canadian Health Care system.
Sure I had to wait a few times in the emergency, but I realize hospitals are staffed for average conditions, and sometimes there are more cases than normal, and the gotta triage.
The only experience that I had with the American Hospital System was in Hawaii when I had a minor injury that I had to be looked after.
Waited 2 hours for a Dr., who bandaged me up and gave me a prescription for painkillers.
I had extra insurance, and I found out later that they charged $ 3500, and after some negotiations the Insurance company paid $2,800.
It’s a game of chicken.
I just like it, when I can go to my Doctor or hospital, without worrying about the cost.

Bingo.

my fam has never had any issue with healthcare here.
I am in an urban centre though, so I’m sure its very different out in the hinterland.

#159 Immigrant man on 01.12.22 at 12:44 pm

#127 IHCTD9 on 01.12.22 at 9:30 am
That will persist until newcomers decide other countries offer a better deal.
——-
Sorry, that’s just not gonna happen. People move for opportunity. Believe it or not, there are people that move to places far worse than even this “Canada of the future”. For example, people will move from Central Asia to Russia if they think that it will offer them better economic opportunity (and they do). Would they rather come to Canada? Hell yeah, but it’s harder to get in over here. So I don’t think the stream of immigrants to Canada will dry up. The quality of it may change though, but not the quantity. And I just don’t see any government reducing the numbers of immigrants. Even the “ultra-right wing” Bernier would take in only 100-150k vs 350-400k Libs/NDP/Cons. That is still huge. Current inflation ain’t gonna make raising children any cheaper. Hence, import “ready humans” instead.

Good point about the States. All they need to do is expand the H2B visa list of eligible professions, not even a major overhaul. That would make the high taxpayers be able to flee even easier. Bad combo for Canada.

#160 dragonfly58 on 01.12.22 at 1:06 pm

Got a surprise when I replaced some wheel bearings on a trailer last summer. For many years top notch SKF bearings were pretty much the industry standard. Any parts store I know always supplied them. This Summer they had all been replaced by Chinese bearings. Same price , but who knows what quality. I am sure the supply chain somewhere is seeing a larger profit. But is the end user getting their money’s worth ?

#161 Love_The_Cottage on 01.12.22 at 1:11 pm

For all the people here who were going to leave Canada due to a tax on the value of your home over 1 million even though it hasn’t happened and probably never will.

For all the people who are going to leave Canada due to no free coverage for unvaccinated in Quebec hospitals even though it hasn’t happened yet and I don’t think it would withstand a court challenge and you don’t live in Quebec.

Happy trails.

#162 Shawn on 01.12.22 at 1:11 pm

#143 Dharma Bum on 01.12.22 at 11:20 am
#196 Shawn (from yesterday)

You lost me at Milk and probably lost all credibility and self-identified as a “nutter” in the minds of most people.
————————————————————————————————————

The promotion of milk consumption for “health” is a creation of the dairy boards. Milk is not healthy. It is fattening.

etc.etc

************************
I rest my case.

You were listing a bunch of snacks and fast foods that we all agree are unhealthy and ruined your point by including Milk and Orange juice which only the fringe groups would put in the same category. Ya should have saved those for another time. Surely you agree?

#163 headley on 01.12.22 at 1:16 pm

some germy tennis dude trying to break into Australia.

He overcame the illness naturally in December 2021 and tested negative, and now he is germy? You can do better Garth.

He lied on his docs and tried to skirt a law. Very germy. – Garth

#164 McSteve on 01.12.22 at 1:20 pm

At any other time in history, raising rates would dump a cold bucket of water on inflation. But with sovereign and personal debt so high, could the government ever raise rates to 20% like in the early 80’s without imploding when they go to 6 %? That is the question…

I think the only play is to figure out how to level this nose-dive off and inflate away the debt. But first, you need to pull hard on the stick. Not going to happen….

#165 Observer on 01.12.22 at 1:20 pm

#136 SoggyShorts on 01.12.22 at 11:02 am
#49 SunShowers on 01.11.22 at 5:27 pm
Slippery slope/whataboutism.

But yeah, if you insist: smokers and overweight people paying more *could* happen, and IMO that’s fine.

This ignores the fact that being fat isn’t contagious but whatever
^^^^^^^^^^^^^^^^^^^^^^^^^

Also ignores the fact that there is no vaccine that mitigates serious illness due to obesity.

#166 IHCTD9 on 01.12.22 at 1:22 pm

#158 Immigrant man on 01.12.22 at 12:44 pm
#127 IHCTD9 on 01.12.22 at 9:30 am
That will persist until newcomers decide other countries offer a better deal.
——-
Sorry, that’s just not gonna happen. People move for opportunity…

…Good point about the States. All they need to do is expand the H2B visa list of eligible professions, not even a major overhaul. That would make the high taxpayers be able to flee even easier. Bad combo for Canada.
____

I guess we’ll see. Depending on which study/report you read – Canada already loses 35-40% of all its immigrants within 20 years of their arrival – and this was over 5 years ago. Mostly young Men.

We can lure them in, but they may not hang around. If immigration is to be a success, they need to commit. For them to commit, Canada needs to offer the same promises to newcomers as it does to born Canucks. There are steadily increasing swaths of Canada where that promise is no longer being kept. Even if you work 80-90+ hrs per week.

The US will eventually do it – it’ll be a game changer. I agree we’ll see the top tier of higher earners scrambling to become Americans. It’s just a no-brainer for these particular folks.

#167 Faron on 01.12.22 at 1:28 pm

W/re the relationship between wage growth and CB rates (sorry I can’t find the original, non twitter version, but it’s legit, @gnoble79 is a manager of a modest-sized hedge fund):

https://twitter.com/gnoble79/status/1481111470901542921/photo/1

And don’t worry SunShowers, I haven’t abandoned my social-democratic awareness. These wage growth numbers don’t reflect the affordability reality of the bottom 75% of earners although it is encouraging that the lower quintiles have seen the fastest wage growth for the first time in decades.

Of course, the wage growth could crash back down too…

Here’s another from that same feed comparing Price/Sales of the dot com era puffballs to Price/Sales of today’s profitless garbage (AKA ARKK) stocks. Yikes!

https://twitter.com/gnoble79/status/1481250414473490436/photo/1

#168 Shawn on 01.12.22 at 1:37 pm

1980’s were not heavenly

#119 Billy Burnes on 01.12.22 at 3:50 am
Garth, have you forgotten the massive recession starting in 1980? You couldn’t get a job . Thousands turned up for wait jobs ads. Vanc’s fancy shopping Robson St was boarded up. You could fire a cannon down Granville. Everything got mean.

***********************
Agreed! I graduated engineering in 1984. Jobs were extremely scarce. Help wanted signs were literally never seen until I spotted one in Toronto in 1986 and it jarred me. No such signs in Nova Scotia at that time. Unemployment rate in Newfoundland I recall 18% plus. Canada was around 9%. Hey but a house was cheap if you had cash and a job. Or could borrow at extreme high interest rates. Yeah, not all a bed of roses at all.

Employment really got easy only somewhere around 2004.

#169 Ponzius Pilatus on 01.12.22 at 1:38 pm

#158 Immigrant Man

Good point about the States. All they need to do is expand the H2B visa list of eligible professions, not even a major overhaul. That would make the high taxpayers be able to flee even easier. Bad combo for Canada.
————————
Sure, take away a job from an American.
Better wear a bullet proof vest to your new work place.

#170 Shawn on 01.12.22 at 1:44 pm

Day Trade ForEx rather than work?

Listened to stories last night about a young skilled tradesman that turned down shifts to sit home and daytrade ForEx.

His older boss now going to try it.

I bit my tongue.

Any horror stories out there?

Zero sum game before trading costs. Who are they making money from? Other day traders? I don’t think it is those providing insurance versus those needing to hedge.

Is there a case that those with skill and discipline can consistently win on ForEx day trades? Actually they tell me the trades last only 20 minutes.

#171 Wrk.dover on 01.12.22 at 1:46 pm

#135 IHCTD9 on 01.12.22 at 10:46 am
#124 Wrk.dover on 01.12.22 at 8:46 am
It’s been a long time since I did tapered roller bearings into a brake disk. I’m not sure they do them like that anymore. Even my 19 year old 3/4 ton (2wd) has bolt on 8 stud hubs for the front.
_______________________________

I only have one car built in this century, and it’s a FWD ’02, so yeah. Right-e-o.

#172 willworkforpickles on 01.12.22 at 1:47 pm

We are being drawn into the vortex of the debt spiral now.
From runaway debt to runaway inflation to runaway interest rates (2023&beyond) to a weaker/weakening (artificial economy) to more rampant debt piling on (unavoidable).
We were warned years ago already, when the chit hits the fan its going to be bad…much worse than 08…devastating even.
Smooth talk was preferred over austerity that could have saved us…it sounded so much better than any dreaded austerity measures, at the time.
Its too late…economic devastation into mid 2023 and beyond? ….Plan for it!

#173 It's so over, Biden and FRAUDCI defeated on 01.12.22 at 1:48 pm

DELETED

#174 Sail Away on 01.12.22 at 1:49 pm

#157 KLNR on 01.12.22 at 12:37 pm

Re: healthcare

But, if you got money, you’re always treated better, no matter where.

——–

Not here. And that’s a travesty since better treatment is one of the best perks of having money.

#175 Shawn on 01.12.22 at 1:50 pm

Inflation Estimates

To those who see 15% inflation at the grocery store: How much should you deduct from your personal inflation number to account for far less driving and not eating out and not traveling?

#176 Typical Cognitive impairment on 01.12.22 at 1:53 pm

50% of ICU coming from 20% of the population? Vaccines work. – Garth

No they do not !!!!!! Let that sink in your thick skull..

ER DOCTOR

#177 IHCTD9 on 01.12.22 at 1:58 pm

#156 Faron on 01.12.22 at 12:28 pm
#127 IHCTD9 on 01.12.22 at 9:30 am

Zero culture is a bit dramatic. Where there are humans, there is culture full stop. Arguably, tough times breed culture because socializing is free.
____

Yeah there will be culture, just not anything a visitor would identify as Canadian culture.

#178 Network Admin on 01.12.22 at 2:15 pm

Is #175 useful?

It’s instructive. – Garth

#179 IHCTD9 on 01.12.22 at 2:16 pm

#166 Wrk.dover on 01.12.22 at 1:46 pm
#135 IHCTD9 on 01.12.22 at 10:46 am
#124 Wrk.dover on 01.12.22 at 8:46 am

It’s been a long time since I did tapered roller bearings into a brake disk. I’m not sure they do them like that anymore. Even my 19 year old 3/4 ton (2wd) has bolt on 8 stud hubs for the front.
_______________________________

I only have one car built in this century, and it’s a FWD ’02, so yeah. Right-e-o.
___

Well if you ever upgrade, at least your repairs will become easier (and cleaner). I’m back to shitty greasy WB changes with my “new” ’91 C2500 LD.

#180 Faron on 01.12.22 at 2:17 pm

#176 IHCTD9 on 01.12.22 at 1:58 pm
#156 Faron on 01.12.22 at 12:28 pm
#127 IHCTD9 on 01.12.22 at 9:30 am

“…not anything a visitor would identify as Canadian culture.”

Can you define what that is? Which era that it applies to? I’m resisting the temptation to argue here, but things like “Canadian Culture” raises some MAGA-esque alarms as does “Old Stock Canadians”. I think it’s possible that as Canada changes there will be some positives. What is more likely to happen is that the culture is one that you don’t recognize and feel alienated from.

But, I get it even though I know that my reflexive views of “culture” are socially ingrained and probably not accurate.

I’ll offer my perspective. The main Canadian characteristic that I value is a greater dedication to a common good. The main US characteristic that I value is the seeming greater sense people have to express their views. This week I had back-to-back meetings with a Canadian group and then a US group and the US group just seemed that much more comfortable to me because I could tell where people stood. There was less polite hedging of opinions. Interestingly, I think these cultural/social dynamics are at odds with each other.

#181 Brandon on 01.12.22 at 2:19 pm

Are we heading back to the ’80s? No way will interest rates reach double digits, let alone 3 to 4%.

Why?

One word: DEBT.

The municipalities will go bankrupt. The provinces will go bankrupt. The entire country will go bankrupt!

The massive debts that are evident now were not so in the ’80s. Simply put, the debt-service payments would crush us. The BOC will not let that happen.

Rates will be allowed to increase to a level slightly less than inflation (which won’t be allowed to reach double digits). So debt will be inflated away relative to GDP, very much like the time spanning the 1940’s and 1950’s.

This is the only way of this mess.

#182 Dr V on 01.12.22 at 2:20 pm

139 Not fooled

“We sold and retired during the 2017 YVR RE peak, and our portfolio went from essentially zero to 7 figures overnight……The ratio of roc to cap gains will change over time, but we’re taking full advantage of the current favourable conditions.”

Can you give us any more details to explain this
strategy? Are you collecting public pensions? Private pensions? Have you bought back in to the RE market?
Different location?

I’m just starting retirement and am trying to develop a strategy for realizing cap gains. In BC, I still see “favourable conditions” to realize cap gains up to about $90k income. Downside is you lose old age tax credit.
Gains would go into TFSA, then nothing matters tax-wise. Also concerned about increased inclusion rate.

#183 willworkforpickles on 01.12.22 at 2:22 pm

In 3 to 5 years, 80 to 90 million US jobs are figured to be replaced by AI.
Feed that into the coming depression.

#184 KLNR on 01.12.22 at 2:22 pm

@#147 Novax Djokovid on 01.12.22 at 11:32 am
My goodness, are Australias bitter.

Novak has exposed how ridiculous the whole thing is.

What is Novak guilty of? Being healthy – that’s what!

Nah, novax is just being a diva as usual.

#185 Squire on 01.12.22 at 2:46 pm

#48 Steuy on 01.11.22 at 5:27 pm
Oh No, not the Eighties! Do I have to wear Big Hair Again?Reganomics was a thing back then. What will we call it this Time; Bidenomics???
——————————
it will be called Harrisenomics
https://nypost.com/2021/12/17/joe-biden-accidentally-calls-kamala-harris-president/
accident or a slip ?

also stats
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1045619/Technical-Briefing-31-Dec-2021-Omicron_severity_update.pdf

draw your conclusions ….. fast up, fast down

RE: Quebec
deflect, deflect. So much time Quebec and Ontario had to increase hospital capacity, surge plans, etc etc but no.
In fact, Ontario’s government
has cut more than 18,000 hospital beds since 1990 and still the cuts are continuing

http://www.ontariohealthcoalition.ca/wp-content/uploads/backgrounder-on-hospital-bed-shortage.pdf

#186 Ustabe on 01.12.22 at 2:51 pm

#175 Typical Cognitive impairment on 01.12.22 at 1:53 pm

50% of ICU coming from 20% of the population? Vaccines work. – Garth

No they do not !!!!!! Let that sink in your thick skull..

ER DOCTOR

Six exclamation marks…six!
Capitalization!

We better listen to this guy, eh?

All the auto parts guys…Rock Auto.

I mean ROCK AUTO!!!!!!

#187 VladTor on 01.12.22 at 2:54 pm

Do you believe every press release from real estate marketing companies? – Garth
**********

Garth, it is miracle, but unbelievable amount Canadians trust them. All my friends among those blinded people.

Typical mantra is – house prices never ever fall down and never ever will fall down.

I stopped discussing this and my response now is “OK”

#188 Novax Djocovid on 01.12.22 at 3:03 pm

#183 KLNR on 01.12.22 at 2:22 pm
@#147 Novax Djokovid on 01.12.22 at 11:32 am
My goodness, are Australias bitter.

Novak has exposed how ridiculous the whole thing is.

What is Novak guilty of? Being healthy – that’s what!

Nah, novax is just being a diva as usual.

No he is not being a diva. He’s the #1 rank player. He’s THE draw. You want your “open” to matter, you want the headliner to be there.

He’s been invited.
He’s been given a visa.
That visa was cancelled for PR reasons, because politicians looked like fools and Australians realized they’ve been bamboozled.

Now it’s Novak’s fault?

Why? Because he’s healthy?

#189 willworkforpickles on 01.12.22 at 3:11 pm

My wife just came into my den, library, converted spare room, whatever one might want to call it…obviously just at her own desk computer, and said to me…”you are just a bundle of joy again today for all those blog readers”
I replied with a ….Yeah, they probably hate me even more now than yesterday.

At least we can still laugh it up.
Her thoughts are…”when the end comes – the end comes, who the hell cares”

Time for a shot of whiskey, best made on planet earth. Had to post it.

#190 IHCTD9 on 01.12.22 at 3:23 pm

#179 Faron on 01.12.22 at 2:17 pm
#176 IHCTD9 on 01.12.22 at 1:58 pm
#156 Faron on 01.12.22 at 12:28 pm
#127 IHCTD9 on 01.12.22 at 9:30 am

“…not anything a visitor would identify as Canadian culture.”

Can you define what that is? Which era that it applies to? I’m resisting the temptation to argue here, but things like “Canadian Culture” raises some MAGA-esque alarms as does “Old Stock Canadians”. I think it’s possible that as Canada changes there will be some positives. What is more likely to happen is that the culture is one that you don’t recognize and feel alienated from.
___

Yes I could, but no point in doing so as my definition is individual and era-specific. To complicate matters, what I define as Canadian Culture already well precedes my time here. The most I’ve ever experienced of it amounts to a hand-me -down from those who lived it. When I think of Canada and it’s peoples my thoughts go back decades and follow the fading traces of same to the present.

Whatever Canada turns into from here on in won’t change my mind much. Right now is likely the worst time ever for Canadians. Piles of debt everywhere you look, stunted fertility rates, insane housing market, unbridled greed, absolutely pathetic politicians. If you want an idea of my definition of Canadian Culture – you can go with the opposite of everything you see going on today.

#191 Faron on 01.12.22 at 3:25 pm

#138 Sail Away on 01.12.22 at 11:11 am

@Faron, a quick update on my August 19 mining positions in BHP, LIF, NTR and VALE since you seemed a bit fixated on them:

Currently +7% total return, 9% avg div going forward. Physicist took a position at the same time in XBM, and that is currently +22% with 0 div.

Sail Away, your future as a credible source of stonk tips relies on reading this tome (Sorry for the hypergraphia Garth. The TL;DR is your lack of risk management or discussion differentiates you from a credible source of stonk tips putting you in the degenerate gambler category. Garth, maybe a piece on how you pros manage risk is in order?):

First, I can’t believe you are crowing about this as a success given that you haven’t outperformed a holding of SPY or NDQ. Actually, I can believe it. It is coming because of the past two days of performance.

Glad you point out XBM. Back then I argued (either in a comment or in my head LOL) that the sector ETF was (almost always is unless single stock analysis is your full-time job) the better route and you have proven that point extremely well. I will detail now how that played out.

In this case you were heavily exposed to a limited portion of the commodities basked (+- steel and potash) and also were highly geographically exposed to Chinese demand. XBM has exposure to a broader range (although is heavy Copper and seems to track it) and, thus, will be less volatile while capitalizing on any reopening commodities themes. These commodities are also linked to the dollar because commodities trade in USD. The ascendant dollar put pressure on your choices and XBM until it reversed in mid November. Look at the past two days of DXY and XBM. What do you see? Yep, dollar is finally backing off and commodities are jumping bigly.

Here’s more detail not including divvies, so underestimates by ~ a quarter’s worth of dividends.

Vale: -14%ish (plus minus currency)
BHP: flat (plus minus currency conv)
LIF: -3% in CAD
NTR: +23% in CAD

Three of your picks were garbage at that time and were down as much as 37% in mid November. You gambled and broke even while getting to experience very gross paper losses if you held because you were exposed to the singular risk of the price of one commodity, steel (look up FEF1! in tradingview and note the correlation with several of your holdings). 3 of your stocks gave you very little diversification and if you did some analysis, you may have seen that your exposure was waaay skewed. The fourth, NTR, offers diversity from the others but still has single name risk. All this to arrive at gains that were equivalent to SPY and NDQ (+7.5% plus 2.5% USD appreciation with max drawdown of -2.3% and 7% plus 2.5% USD appreciation with max drawdown of -3%).

This. Distinction. Matters. I don’t think anyone can be seen as credible if they don’t assess the risk associated with their positions. Garth and co don’t talk about it as a stand alone subject, but risk management and assessing exposure are critical parts of successful asset management. If you don’t bring that into your game you are gambling and, like your and my excessive posting to comments here, it is a sign of an addictive personality at work and a lack of self-control seeking a dopamine hit.

#192 Wrk.dover on 01.12.22 at 3:30 pm

#159 dragonfly58 on 01.12.22 at 1:06 pm
Got a surprise when I replaced some wheel bearings on a trailer last summer. For many years top notch SKF bearings were pretty much the industry standard. Any parts store I know always supplied them. This Summer they had all been replaced by Chinese bearings. Same price , but who knows what quality. I am sure the supply chain somewhere is seeing a larger profit. But is the end user getting their money’s worth ?
___________________________

Atlas Metals has been gone from Welland for years, so where you gonna get the alloy? China!

SKF probably has moved…to China too.

Every car part I source seems to be Chinese, even antique replacement parts.

#193 IHCTD9 on 01.12.22 at 3:41 pm

#159 dragonfly58 on 01.12.22 at 1:06 pm
Got a surprise when I replaced some wheel bearings on a trailer last summer. For many years top notch SKF bearings were pretty much the industry standard. Any parts store I know always supplied them. This Summer they had all been replaced by Chinese bearings. Same price , but who knows what quality. I am sure the supply chain somewhere is seeing a larger profit. But is the end user getting their money’s worth ?
____

By now, I’m sure China has figured out how to make a good bearing, so they’re probably fine – especially just for a trailer.

I would not hesitate to put a Chinese bearing in my trailer – provided the cost was a minimum of half of what SKF wanted. Any more than that, and I’d ante up for the SKF.

That said, when I rebuilt the final drives on my dozer, I carefully searched out the part numbers for genuine made in the USA SKF full-complement bearings (SKF manufactures in China too). It’s too big of a job to risk doing it again. I would not have put Chinese bearings in those final drives even if I got them for free.

#194 Wrk.dover on 01.12.22 at 3:48 pm

#185 Ustabe on 01.12.22 at 2:51 pm
All the auto parts guys…Rock Auto.
I mean ROCK AUTO!!!!!!
___________________________________

I have 48 RockAuto fridge magnets. (one used to come with each order)

#195 Not Fooled on 01.12.22 at 3:51 pm

#181 Dr V on 01.12.22 at 2:20 pm
139 Not fooled

“We sold and retired during the 2017 YVR RE…

Can you give us any more details to explain this
strategy? Are you collecting public pensions? Private pensions? Have you bought back in to the RE market?
Different location?

I’m just starting retirement and am trying to develop a strategy for realizing cap gains. In BC, I still see “favourable conditions” to realize cap gains up to about $90k income. Downside is you lose old age tax credit.
Gains would go into TFSA, then nothing matters tax-wise. Also concerned about increased inclusion rate.

**********

We left YVR and bought on southern Vancouver Island at a time when the price differential was much more in our favour. That option is quickly disappearing.

I commuted a smallish DB pension to a LIF, otherwise we just have my spouse’s CPP, OAS, and now GIS due to low taxable income. Professionally managed B&D portfolio, so I can no credit for the melt strategy they employ.

Yes, if the inclusion rate increases we may feel the pinch further down the road, but we have the freedom to tailor withdrawals in way that pension or employment income can’t be. We don’t have large RRSPs, which helps. About 60% of the portfolio is in cash account and TFSAs.

My LIF is being melted well before the mandatory conversion age. The rest of our expenses come from the cash account, CPP, etc. Spouse’s small RRSP will be converted in 2 years, withdrawals will go into TFSA I presume.

Portfolio continues to fatten, despite withdrawals. We aren’t wealthy but live in a well-serviced community and know we have enough money for the rest of our lives, barring utter disaster.

#196 Satori on 01.12.22 at 3:53 pm

#145 I See You on 01.12.22 at 11:23 am
Anyone else find it disturbing that in Ontario and Quebec these numbers of 500 and 250 in ICU are crushing the system?

You take that into population and we’re talking about a crazy small number of 3 ICU beds per 100,000 population.
____________________________________

Take an ALREADY FULL clinical unit, and add in some Covid patients. THE ICU is NOT just covid people with the other people requiring intensive care going home to make room for the onslaught of covid patients.

#197 Immigrant man on 01.12.22 at 4:31 pm

#168 Ponzius Pilatus on 01.12.22 at 1:38 pm
Sure, take away a job from an American.
Better wear a bullet proof vest to your new work place.
——–
Never heard of Canadian professionals getting shot in US. I know quite a few geos and engineers that moved to Nevada (pretty gun loving place), those that worked in Alaska (obviously guns) and so on. Mines tend to be remote (more gun loving hicks). All good, no problems. And of course tons of IT ppl that moved/did stints in states, in large urban centers. Noone was threatened with guns.

#198 Dr V on 01.12.22 at 4:38 pm

194 Not fooled – thanks and welcome to the island!

#199 Sail Away on 01.12.22 at 4:42 pm

@Faron

Haha. I love your fury when my stocks do well, which, as it happens, is often.

TSLA +4% today, by the way. 6,407.18% since first position.

#200 SoggyShorts on 01.12.22 at 4:53 pm

#164 Observer on 01.12.22 at 1:20 pm
#136 SoggyShorts on 01.12.22 at 11:02 am
#49 SunShowers on 01.11.22 at 5:27 pm
Slippery slope/whataboutism.

But yeah, if you insist: smokers and overweight people paying more *could* happen, and IMO that’s fine.

This ignores the fact that being fat isn’t contagious but whatever
^^^^^^^^^^^^^^^^^^^^^^^^^

Also ignores the fact that there is no vaccine that mitigates serious illness due to obesity.
******************
Right? I mean if there was a vaccine that turned lung cancer into a mild sniffle I’d probably still smoke.

#201 dragonfly58 on 01.12.22 at 5:12 pm

SKF is still a very major supplier of bearings. Worldwide but home base is in Sweden. I am sure the particular bearings used in the vast majority of 3500 pound trailer axles are still in SKF’s product line up. But someone at the national distribution, wholesale level of replacement parts has decided to go with a cheaper part.
I have no doubt I could have special ordered SKF bearings through a bearing jobber. Or over the internet. But that would have taken at least a few days, and I am also finding a lot of the places I once did business with while in the trade are becoming far less welcoming to over the counter, cash sales.
Best place I have used in the past, both availability and price is in the U.K. But about 2 weeks delivery. Not garden variety trailer bearings , but oddball ones for some of my vintage projects that are hard or impossible to find in Canada.

#202 dragonfly58 on 01.12.22 at 5:26 pm

Hi TD , I hear you about the final drives. At work one of our purchasing agents found out he could source Romanian bearings at a substantial discount compared to the name brand SKF , FAG and similar we had been using. Mainly for European pumps and gear drives. They quietly went in the bin. Some of those gear drives had a replacement cost in excess of $50,000. So what if you save a hundred or two on bearings. Does it make any sense to risk a cut rate product ? We started specifying the exact bearing required after that.

#203 Punch Bowl Economics on 01.13.22 at 12:49 pm

The Tiff, will he, or won’t he, raise rates on Jan26th.

Vote now:

YES X
NO