The ironic

Let’s summarize.

The burning issue in Canada, polls say, is the cost of stuff. Above all else, the price of houses. This is why Pierre P’s vid of a dodgy $5 million Van property received a brazillion views. It’s why NS and BC brought in ownership laws penalizing fellow Canadians. Why Ontario and the nation repel non-resident buyers. Why we have a mortgage stress test. Why there are ‘vacant’ house taxes in Vancouver and soon in Toronto, Ottawa and beyond. Why there will soon be a national flip tax and why HST is now slapped on assignment sales.

For two years most elections have been fought on getting real estate prices down and affordability up. It’s happening again in Ontario ahead of the June 2nd vote. This has been a defining issue for Canadians, and to date no government has been effective in reducing property values by a single dollar.

But then came Tiff.

Since the Bank of Canada decided to turn bad ass on inflation, everything has changed. Interest rates have jumped a couple of times, will head higher (a lot) in 17 days, then again in July, while letting bonds roll off its balance sheet as it engages in quantitative tightening. The result has been an explosion in bond yields (up by a factor of six) and mortgages that were 2% in February becoming 4.5% in May, and on their way to perhaps 6% by the autumn.

Real estate sales as a result have already dropped 20% to 45%, depending on the market. Average prices are slipping weekly. Showings have plunged. Offer nights yield no offers. Multiple bids and blind auctions are kaput – except in rare circumstances. Listings are rising as deals are dropping. Buyers now have far more choice and vastly more time to make a decision. Conditional offers are back. Financing and home inspection clauses are again becoming routine.

In short, what every government and wanna-be politician in the land failed at achieving, is now being unveiled as the cost of money rises. Ironically as houses cheapen, buyers retreat. That exposes a deep flaw in the human psyche, and underscores our innate lack of confidence and analysis. People are wusses.

But this post is about something else. Irony.

For example, just as the central bank’s aggressive tightening policy stares down society’s big angst, making real estate more accessible, the frontrunner Con leader wants to fire Tiff Macklem and take over Bank of Canada policy.

Why? Because Poilievre says the CB was politicized by the Trudeau Liberals and issued bonds used to finance excessive Covid deficit spending. He calls it ‘printing money.’ But ironically as bonds are now shunted (the pandemic is over) and the cost of money rises, reducing credit, the candidate says his government would politicize the bank completely. It’s as if the pied piper hopes the mice are blind.

More irony. Falling real estate sales and prices used to be the goal. Now that they’re happening, it’s suddenly a crisis. Calls for the mortgage stress test to be gelded or slaughtered are rising from the industry.

“There’s chatter of ‘adjusting’ the stress test, to basically keep the prices going to the moon,” says engineer and blog dog Osama, in Burnaby. “This stuff is basically too big to fail. I should have loaded up on debt 10 years ago.”

He’s right. The regulator (OSFI) is being urged to kill the test which seeks to ensure borrowers can afford higher rates in the future. These days they must prove they can make payments 2% greater than the current five-year rate of about 4.2% – which seems reasonable since 6% mortgages may be the norm in months.

OSFI said last week it might “make adjustments at any point if necessary for the health of the Canadian lending industry.” That would be a departure from its annual tweaking in December. And note what the regulator cares about – the health of the lending industry. Not the health of buyers.

Says a mortgage broker: “The market is softening, prices are coming down. They (OSFI) did the stress test to cool the market. They don’t need any cooling of the market anymore. It’s already there now. AS things stand, they have got to do something.”

See? Falling prices are b-a-d.

And check out this irony: the CB has barely started a year-long series of increases as inflation spurts out of control, and this headline appears in the MSM…

Is it true? Did a central bank deputy-boss Toni Gravelle really say if real estate prices come down the Bank of Canada will stop in its tracks, because we all actually fear lower house values? Or was the Globe reporter having a bad day?

Turns out Gravelle said rate increases might “pause” if inflation eases, if the Ukraine war ends or if house prices fall enough to decimate debt-drenched households and their consumer spending.

His words, exactly:

Rising interest rates are designed to slow the economy by making borrowing more expensive. That tends to slow sectors like housing. But this slowing might be amplified this time around because highly indebted households will face high debt-servicing costs and will likely reduce household spending more than they would have otherwise. Our base-case scenario includes a slowdown in housing activity. But we could see a larger-than-expected slowdown due to higher indebtedness and unsustainably high housing prices.

Unreported was Gravelle saying rates might rise more than expected if the global supply chain stays broken, if consumers, “spend more of the savings they accumulated during the pandemic than we currently expect,” or if “some of the increase in housing demand we saw during the pandemic—for bigger housing and in suburban locations—persists much more than we have factored into our projection.”

There ya go. The masses thought high prices were the enemy. They clamoured for action, and received many new taxes in return. Now politicians, regulators and monetary authorities waffle and hum as a nation of house junkies recoils.

Don’t ask what comes next.

About the picture: “I have been a daily reader since 2018. A saver since childhood, I never took investing seriously until I started following your blog,” writes Mariah. “Thank you for setting me on the right track and for everything you do for our great country. I’m sharing a photo for you to consider. These cover girls are Winnie and Betty. 11 month old sisters, loved by human sisters. Winnie is a big city gal and Betty can be found in Bunnypatch. They are looking forward to a fun summer together on Lake Huron.”

157 comments ↓

#1 Flop… on 05.15.22 at 11:51 am

Flop Drops.

It’s never good when a listing starts out “This complex has problems.”

Pretty sure this has been going on down there for years, these guys are facing their D-Day tomorrow so we’ll put a sticker on it and see how it pans out.

The details…

200- 2468 e Broadway, Vancouver.

Asking 275k

Assessment 273k

Won’t worry about how they just dropped the price, that’s not what this is about.

They still want the assessed price, PLUS the buyers will have to hand over a special assessment of 240k, in what world does that make sense?

Handing over half a million for a leaky condo in a so-so part of town, I just showed a nice little studio yesterday that went for 427k in a nicer neighborhood.

The photos of this one are pretty dire, it looks like the guy living there just sat down for his evening Aperitif and just said “do what you’ve gotta do, and the get out!”

Didn’t even get out of the way of the photos.

Thanks for the reminder.

Buying at the bottom end of Vancouver sucks, renting at the bottom end sucks even harder…

M47BC

“Foreclosure sale. Property sold ‘as is’. Measurements are approx., buyer to measure if deemed important. This Complex has problems and buyers will have to consider special assessments/levies. SPECIAL LEVY amount of $240,000+ is not included in the purchase price and is to be paid by Buyers. COURT APPLICATON DATE FOR SALE APPROVAL IS MAY 16, 2022.”

https://www.zealty.ca/mls-R2648337/200-2468-E-BROADWAY-Vancouver-BC/

#2 Prince Polo on 05.15.22 at 12:06 pm

TPTB are missing the opportunity for three additional (and “glorious”) taxes:
a) stupidity tax
b) FOMO tax
c) blame the person in the mirror tax!

#3 I'm voting Pierre Poilievre on 05.15.22 at 12:19 pm

‘Bank of Canada Warns Debt Is A Problem’ – SERIOUSLY

If Poilievre (or anybody for that matter) did get to be PM, they better start firing heads and rethink this BoC cartel. How could they not see us being led down the path of Greece?

‘But, but, but… we just couldn’t see fat tail risks…’ they always lament.

Enough! Our society is being manipulated for the .001% and for what? So we always end up in boom-bust issues and chaos that follows?

#4 Quintilian on 05.15.22 at 12:19 pm

Exceptionally cunning and high IQ manipulators know that the best way to perpetuate their lies, that support their agenda, is to add a sprinkling of truth.

CB’s are beholden to politicians that is a fact.

However, PP would be a disaster for Canada.

The decency of most Canadians would render him repulsive, but not necessarily unelectable.

Uncertainly and fear make people do things that places perceived self-preservation over morality and tends to attract conservetive voters.

#5 MC on 05.15.22 at 12:20 pm

No, don’t stop! What comes next??!

#6 Overheardyou on 05.15.22 at 12:21 pm

The nation of paper millionaires continues…

#7 T on 05.15.22 at 12:30 pm

What comes next.

Increases in mortgage rates.
Lowering of the stress test rate.
Government programs to help families stay in primary residences they can’t afford.
Bankruptcies of highly leveraged property investors with negative cash flow.
House prices depressed for some time.

#8 yvr_lurker on 05.15.22 at 12:36 pm

“making real estate more accessible”
—–
Good post. I do hope for the next generation that prices do come down and that there are the roughly the same opportunities for them that I had to get into the market. Your comment “making real estate more accessible” is way too premature. Infinity divided by two is still infinity. Prices are very sticky and some of the rapid gains over the past few years will be clawed back when someone needs to sell owing to mortgage renewal, but I don’t see it going below 2019 levels. Immigration to the major cities will keep the pressure on….

#9 Faron on 05.15.22 at 12:37 pm

#3 I’m voting Pierre Poilievre on 05.15.22 at 12:19 pm

The BoC doesn’t set the budget. And, believe it or not, boom/bust is far less bad than it used to be. How many bread lines have you seen outside of global pandemics? 0.

PP sending Canada into a fiscal backwater with a politicized CB and a gold/bitcoin standard would be a disaster for all Canadians both rich and poor.

However, I love PP. He allows a left shift in the libs by splitting the cons.

#10 dosouth on 05.15.22 at 12:37 pm

There ya go. Today’s media editing what they want to make as a headline.

I can’t believe it, not fake but not true….just adjusted for maximum eyes on page. Oh well, guess we will have to make our own decisions as all this is not going to end well. (or maybe it will…)

Meanwhile in the “real” world (of social media??)

Potato chips cause cancer….or do they?

Meanwhile

#11 the Jaguar on 05.15.22 at 12:41 pm

I wasn’t going to post again, but maybe just this one time. Some things need to be said.

Listen up Tiff. Greenspan, Bernanke, Yellen and Powell. All of them mafia. Don’t make the same mistake. As Jeremy Grantham said:
“They act as if a low rate is a panacea and comes with no downside. That is clearly nonsense. It’s created, I think, the biggest evil in our society and that is inequality”.
Drive down rates, drive up asset values. The top 1% own 35% of the assets, the top 35% own all assets. If things don’t return to normal there will be blood in the streets. Already happening in some places.

Stay the course Tiff. Don’t think like a mafioso, think like Kevin Warsh. Amen.

#12 Sail Away on 05.15.22 at 12:41 pm

#1 Quintilian on 05.15.22 at 12:19 pm

Uncertainly and fear make people do things that places perceived self-preservation over morality and tends to attract conservetive voters.

———-

Yes. In some cases, that even leads to completely fabricating and taking action on false allegations against a sitting president. Possibly the most egregious false accusation in US presidential history, since it was known to be false by its most rabid promoters.

Oh… but the liars weren’t conservative. Minor detail.

https://www.cnn.com/2021/11/18/politics/steele-dossier-reckoning/index.html

#13 crowdedelevatorfartz on 05.15.22 at 12:46 pm

@34 Quintillian
“The decency of most Canadians would render him repulsive, but not necessarily unelectable.”
+++

If the last few elections Federally, Provincially and Municipally are any indication.
New “leaders” aren’t “elected”.
The protest votes “unelect” the incumbent.

So, yes.
Voters will hold their noses and…..
PP will probably be the PM after Trudeau is punted in 2025….

Probably not. The Cons are migrating in the wrong direction. – Garth

#14 mj on 05.15.22 at 12:47 pm

I’ve mentioned this before. On the front page of realtor.ca shows how many properties are for sale in Canada. The beginning of April was about 167,000 and now it’s over 201,000 seems like it’s growing around a thousand properties a day

#15 Scott in Gibsons on 05.15.22 at 12:53 pm

Yeah! Those dumb wusses! Don’t they know that soaring mortgage rates and falling prices signal a great time to buy? Are you calling the bottom Garth?

#16 Ponzius Pilatus on 05.15.22 at 12:57 pm

#78 Faron on 05.15.22 at 12:28 pm
#65 Ponzius Pilatus on 05.15.22 at 12:09 am
#62 Sail Away on 05.14.22 at 10:53 pm
#56 Søren Angst on 05.14.22 at 7:05 pm

Why not Ukraine? The music of eurovision is so bad that it doesn’t really matter which country is selected. Ukraine is popular. Pick Ukraine. KISS
————-
Why even hold contests then?
Just do a poll and the most popular wins.
Could save lots of money like on the Olympics.
KISS indeed.
BTW, Germany came in last.

#17 Ponzius Pilatus on 05.15.22 at 12:59 pm

Irony and “the law of unintended consequences” rule supreme.

#18 Doug t on 05.15.22 at 1:03 pm

its Pathetic- this country has its head up its a** so far it can’t see or think clearly – we are doomed

#19 Joel on 05.15.22 at 1:13 pm

Living on vancouver island we have held out reading your blog.

BUT, right now this is the most houses we have seen since they start of WFH. What are the key indicators we should look for to be back in the market for buying.

This will be our permanent residence and first buy in our mid 30’s but nobody wants to buy a house then end up in negative equity

#20 Armchair economist on 05.15.22 at 1:13 pm

If you took all the bad things from the right and compressed them into a human, you get Pierre P. He’s like a walking meme. Would like to vote conservative next time, but certainly not for that guy.
Looks like a lot of froth has come off American markets. Starting to look like normal prices now. Of all the countries in the world, they are positioned to benefit the most in the next couple years. You would never think that by looking at their media, but the fundamentals are there.

#21 "NUTS!" on 05.15.22 at 1:14 pm

My family was in the land development business for over 50 years. What I’ve witnessed over the last 15+ years in Canada defies all intelligent principles of home and property values. While I can’t predict what happens next, I have no faith in any fundamental forces dictating what ‘should’ happen. I suspect whatever it is, ‘it’ will continue to feed this irrational phenomena we call the Canadian housing market.

#22 T Dog on 05.15.22 at 1:14 pm

…but I have to ask:

What comes next?

#23 Quintilian on 05.15.22 at 1:18 pm

Dear confused:

Basic stuff, many politicians are RE speculators/investors, including your sanctified PP.
They also control local zoning, CMHC and BOC.

But just like Icarus, they will take it too high.

#24 Sail Away on 05.15.22 at 1:26 pm

#16 Ponzius Pilatus on 05.15.22 at 12:57 pm

BTW, Germany came in last. [In Eurovision]

———

Of course Germany came last. They probably marched around in military formation singing about Lederhosen.

How did the ‘vanishing Austrian forest sprites’ do?

#25 To the point. on 05.15.22 at 1:37 pm

Sneering, smarmy, smirk. You know who I am talking about, don’t you?

Like that other smooth-talking Pepé Le Pew, does this PP pass the sniff test?

A couple of years in everyone’s face as Opposition Leader and this guy will NEVER be Prime Minister.

Blog dogs should trust their noses on this one.

#26 crowdedelevatorfartz on 05.15.22 at 1:45 pm

It’s not just gas, milk and eggs that’s going up in price this year….

https://www.reuters.com/video/watch/idOV804215052022RP1

#27 Leftover on 05.15.22 at 1:53 pm

What comes next?

Might be, finally, political cover for taxing capital gains on principle residences. The mother of all election issues in 2025.

In this corner, a solution to inequality, a better way to allocate capital and a fairer tax system. In that corner, gob-smacked boomers, an irate real estate industry and, god knows, a convoy of Audi’s occupying Ottawa.

I can’t wait.

#28 Gen Z on 05.15.22 at 1:56 pm

India is banning wheat exports, making food prices higher.

But we should care for a DINK couple working at home who chose to buy a cottage near a disputed reserve in Kelona or faraway Quebec-Newfoundland?

#29 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 05.15.22 at 1:58 pm

Here’s a great couple of great solutions to our national cashflow problem:

Create a Federal Investment Fund to buy up Make Believes game tickets, then sell them online at 1500% markup to gullible GTAHoles who believe that ‘it’s different this time’.

Next, implement a Stupidiot Tax on anyone moving into the Torontoilet housing market. Part of the proceeds would also be spent on mental health counselling for loser fans as well as mandatory life insurance (with a 25% repayment fee to Canada upon death) to anyone willing to take the risk of murder and traffic deaths inevitable in the 416/905.

Hey, did you hear about the Leafs!?

They haven’t lost a SINGLE GAME yet in the 2022-2023 season!

It is DIFFERENT THIS TIME!

WINNING!!!!!!!

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

#30 Danger Dan on 05.15.22 at 2:01 pm

I wouldn’t put it past our enlightened government to impose price controls on fuel as inflation rages. Hey, houses are sacred but screw those greedy robber barons out West with their pumpjacks, ruining the environment and stuff.

In other news, WFH is indeed becoming a fixture –

“We are seeing policies slip in real time,” said Melissa Swift, the U.S. transformation leader at workforce consultant Mercer. “There was previously all this talk about how, for white-collar jobs, collaborating in the office was important. That’s slipping. Now, only the people who need to turn a screwdriver need to be in the office.”

https://financialpost.com/fp-work/employees-are-not-showing-up-return-to-office-plans-unravel-as-workers-revolt-in-tight-job-market

#31 Trudeau and Sing marriage on 05.15.22 at 2:08 pm

DELETED

#32 some guy on 05.15.22 at 2:14 pm

Were Canadians always obsessed with housing? When did this happen? Seems like it will never end at this rate.

#33 HUNGRY BEAR on 05.15.22 at 2:15 pm

The cure for lower prices….. is lower prices.

I can’t wait for the aftermath!

#34 Linda on 05.15.22 at 2:26 pm

Today’s blog pups look like they are already ‘chilling’:)

I have to laugh at the angst regarding falling RE prices. What folks want is to buy the RE they want for low prices, but simultaneously have said RE soar in value. Good luck with that.

#35 Asking on 05.15.22 at 2:34 pm

What comes next?

#36 RJ on 05.15.22 at 2:36 pm

Garth what’s your take on stubbornly high Ontario cottage country. Going to soldier on no matter what or will the bottom ever fall out on waterfront?

It’s prime cottage season. Wait five months. – Garth

#37 NEVER GIVE UP on 05.15.22 at 3:08 pm

I crossed the US Border for a few hours by car 10 days ago. Today I wanted to go again but when I looked at my arrivecan app I was greeted with the message that I was in day 10 of quarantine!

I called to ask what is going on because I was not notified of any quarantine by the border guard.
The CBSA officer on the phone said the arrivecan app has a glitch and that all people crossing get this message.

I asked her how I can go over the border today. She replied that I have to open another account under another email address to get around the issue.

What if I wanted to go every day? I would need 14 arrivecan registrations, with all the time and effort to fill out the forms and upload the information about vaccines.
Arrivecan has been an abuse of the citizenry in my opinion.

I was never able to get it to work on my Pixel 4. I was able to log in by my PC only. When I asked for help when I was in Mexico The problem was predictably thrown back at me as if I was the problem and that I did not follow the directions or that I should contact the phone provider.

So this is just more of the same life sucking, time wasting bureaucracy that the government thinks nothing of doing to its Citizens because they do not value our time or our lives.

Everything they do incompetently that wastes our time from poorly designed traffic lights or roads to 50 page long tax forms shows a disrespect for our family time. Our me time. It never comes out of our work time because that must be made up at the expense of our social time.

Britain simply mails you your tax bill at the end of every year as do many countries. British Citizens do not have to fill out tax forms that are very stressful to many people. No wonder they appear so calm!

It just confirms the callous disregard for the lives of people who pay the government their salaries and pensions.

#38 Søren Angst on 05.15.22 at 3:15 pm

“The masses thought high prices were the enemy. They clamoured for action…: – Garth

Since time immemorial:

Be careful what you ask for.

#39 THE DANDADA on 05.15.22 at 3:15 pm

This is the difference between a free market and a highly manipulated one.

The price of Bitcoin reflects free market forces. The price of bonds reflects nearly 100% artificial and unnatural buying that has no basis in free market economics.

At $30,000 Bitcoin, a lot of truths is already priced in.

Conversely, at $102 on the Aggregate Bond Index, almost nothing is priced in.

Who is going to buy these worthless pieces of paper when the Fed stops doing it?

A lot of money is soon about to get destroyed.

#40 Ponzius Pilatus on 05.15.22 at 3:17 pm

#24 Sail Away on 05.15.22 at 1:26 pm
#16 Ponzius Pilatus on 05.15.22 at 12:57 pm

BTW, Germany came in last. [In Eurovision]

———

Of course Germany came last. They probably marched around in military formation singing about Lederhosen.

How did the ‘vanishing Austrian forest sprites’ do?
———–
I just wonder when the Germans will lose their WWII guilt and stop paying for everything.
All they get for it is disdain and grief.
Right Dolce?
The Austrians entered a guy named Mozart.
And he was booed off the stage.
Ignoramuses.

#41 Paul on 05.15.22 at 3:18 pm

#36 RJ on 05.15.22 at 2:36 pm
Garth what’s your take on stubbornly high Ontario cottage country. Going to soldier on no matter what or will the bottom ever fall out on waterfront?

It’s prime cottage season. Wait five months. – Garth
————————————————————————————————
It’s already started, the cottage owners that know they’ll want out are preparing,

#42 NEVER GIVE UP on 05.15.22 at 3:21 pm

A possible solution to our government and business incompetence would be to start a degree program in our Universities called “Efficiency Studies”.

I think our world needs an army of Efficiency Experts who can use algorithms and statistics to weed out weak and bureaucratic inefficiencies in every aspect of business and especially Government.

These people could axe redundancies and be a gateway between untrained bureaucrats that “know not what they do”, and the citizens that they ask information from.

Information that they often do not even look at.

#43 VladTor on 05.15.22 at 3:24 pm

#36 RJ on 05.15.22 at 2:36 pm

It’s prime cottage season. Wait five months. – Garth

*******
Dear Garth, usually and if things going well need to wait nine months to see result !

#44 Søren Angst on 05.15.22 at 3:37 pm

Watched Eurovision * last night (normally, a pass for me).

Elated at Ukraine’s Kalush Orchestra win with their song “Stefania” (Folk-Rap group). Catchy tune.

Europa viewers made sure that no matter what the 40 country jury votes were (12 votes/country) THEY would decide.

And they did – scroll to the pts table, sort by “Tele” (People votes):

https://eurovisionworld.com/eurovision/2022

When the vote came in & Ukraine had won, I started clapping like crazy. Their pink hat rap singer stole Europa’s heart. Watch what he did at the end of the song (broke +400M people’s hearts):

https://www.youtube.com/watch?v=F1fl60ypdLs

How they managed to be so cheerful is beyond me. 1 or 2? of their members (absent) are in the Ukrainian Army. Here is the song video as seen in Ukraine & now Canada, war and all:

https://www.youtube.com/watch?v=Z8Z51no1TD0

When they did their song, after winning, pink hat thanked everyone. So did Ukraine (cute nod):

https://twitter.com/Ukraine/status/1525612438661615617

————–

Contest this year was in Torino, Italia. They stole our hearts. They did.

The song was written by Kalush Orchestra’s frontman, Oleg Psyuk (pink hat), originally in dedication to his mother. However, the music has taken on a new meaning since the invasion of Ukraine by Russia.

The flute (sopilka, and telenka) player, Vitalii Duzhyk, grew up with Ukrainian folk music and learned to play as a kid. What a voice he has too.

Slava Ukraïni!

* Europa + Oz – Russia

PS:

Most fun Eurovision song was by Moldova (how I remember Alberta):

https://www.youtube.com/watch?v=DUqf_zO2QaI

#45 JOHN PICKETT on 05.15.22 at 3:54 pm

DELETED

#46 Pbrasseur on 05.15.22 at 4:00 pm

No doubt plenty of people in this country will want to keep the gravy train going.

But it’s not about what you want it’s about reality and unavoidable consequences.

Inflation is not going to ease before a deep worldwide recession cleans up this mess, just a matter of time IMO.

#47 Søren Angst on 05.15.22 at 4:00 pm

PS, PS on Eurovision.

Other notables.

Norway managed to empty all the banana shelves in Europa Supermarkets.
https://www.youtube.com/watch?v=adCU2rQyDeY

Serbian version of “Ainsi font, font, fontes petites marionnettes pour les enfants” + water + soap + vat (though nice dig Serbia about Meghan Markle!!):
https://www.youtube.com/watch?v=XXrDgWDo24g

Spain thought they were playing to drunken English tourists on cheap Spanish cerveza with their BOOTY CALL song:
https://www.youtube.com/watch?v=jSQYTt4xg3I
[though, muy caliente!]

Then there was Deutschland. Naw, everyone else in Europe hates them so I’ll spare you the agony.

(Lithuania, sultry, sleek, who knew?)
https://www.youtube.com/watch?v=B6uEWHrr6fM

And in the Who Knew? Dept., Icelandic Dixie Chicks.
https://www.youtube.com/watch?v=G71c48O3j-s

#48 bdwy on 05.15.22 at 4:00 pm

will the bottom ever fall out on waterfront?

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

only when they start making more of it.

very few mortgages on these.

my little bro has like 5m cash sitting in his corp in NS.
if he listened to me and bought NS oceanfront like i told him he’d have 10-15+ now.

—————-
paid 90k water access howe sound oceanfront in ’04.

‘market’ price today maybe 500, would not sell it for 800k.

#49 NOSTRADAMUS on 05.15.22 at 4:07 pm

BARKY TOLD ME!
My grandad has a dog called Barky that talks to him when he eats too many of those (CBD) gummies (not grandad his dog Barky.) Grandad says that Barky told him to tell me that I should buy crypto when it goes to zero. And if it moves into negative territory, like oil did some time back that I should double down. Unlike a multitude of stock promoters, I have never had a bad tip from Barky. People ask what’s the secret of your success-inside information, the best algos, sheer stock picking brilliance? No, none of that, just Barky, lots of leverage and the Fed. Steady lads, hold the line.

#50 Adam on 05.15.22 at 4:08 pm

Are we to believe that the Bank of Canada is completely apolitical and saintly but OSFI is completely beholden to the vagaries of public opinion and the whims of politicians?

Trudeau wants to expand the Bank of Canada’s mandate to include climate change, gender and social justice along with other ESG stuff. But PP wanting to fire the bank’s governor for totally missing their inflation target is beyond the pale?

OSFI is a government agency. The Bank of Canada is not. Firing Macklem would send shockwaves beyond Canada and do substantial damage. PP is grandstanding. He has created a false target. Do not fall for it. – Garth

#51 Pbrasseur on 05.15.22 at 4:13 pm

Went out for a bit of shopping today, stores are incredibly busy, parking lots are full, consumers apparently undeterred by runaway inflation.

Consider that if you think somehow inflation will ease or has already peaked.

#52 BC Renovator on 05.15.22 at 4:16 pm

Can you write a post on Inflation and where we are heading?

#53 Ambi and Vasu on 05.15.22 at 4:20 pm

But then came Tiff……..

No Garth, he came much earlier, in June 2020.

Since his arrival, money-printing presses went into overdrive and real estate got over-inflated, up, up and up in 2021. Please see https://tradingeconomics.com/canada/money-supply-m1

We are not sure though, we think it was Tiff who told the real estate guys he will not raise the rates till 2023 or something like that. Please see https://www.msn.com/en-ca/money/topstories/tiff-macklem-stokes-doubts-about-usefulness-of-forward-guidance/ar-AATkZ1Z?li=AAggFp4&utm_source=hootsuite

Basically, it was Tiff’s doing ……….!!!! But we may be wrong……

You are wrong. The BoC dropped rates and bought bonds to reduce yields, expand credit and save the economy from a pandemic disaster. It succeeded. CBs in every western country did the same to deal with a one-in-a-century event, putting monetary policy in support of fiscal policy. Now it’s in reverse and people silly enough to think 2% mortgages and 20% annual house price gains were normal will learn otherwise. Blaming the CB is completely puerile. – Garth

#54 PeterfromCalgary on 05.15.22 at 4:22 pm

We need all hands on deck to fight inflation. To only use monetary policy means interest rates will have to go up a lot and many unintended negative consequences. Governments federal, provincial and local need to help fight inflation by reducing spending.

A more balanced approach that uses both fiscal and monetary policy will be less disruptive for the economy and people’s lives.

Suggest areas of government cutbacks – something meaningful (which excludes dumping on civil servants). Child benefit? OAS? Defence? Indigenous? Provincial transfers? – Garth

#55 Philco on 05.15.22 at 4:23 pm

#4 Quintilian on 05.15.22 at 12:19 pm
————————-
You got to be kidding?
And you seem to know this for sure?
And all the peeps thought T2 would be wonderful.
Nobody know nothing that’s for sure.
A laughable assumption.

#56 Søren Angst on 05.15.22 at 4:32 pm

#40 Ponzius Pilatus

Right Dolce?

I agree. Travelled many time to Deutschland (I actually like Germans) and they still have that mentality of guilt.

Many a time I told them (youth) they had nothing to do with WWII, that was their Grandparents & Great Grandparents. YOU are the NEW Deutschland.

Act like what you have become NOT what you were in the very distant past.

Still, they harbor guilt. What can I tell you PP.

As for Austria, they were not booed off the stage, certainly not by Italia:

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

——————

Though, I will tell you that in the early days of Covid when it hit Italia first in Europa, Austria’s treatment of Italia certainly deserved to be booed. Little did they know what was coming their way.

I was here during that. Austria’s plate is not clean. Still, Torino Italia cheered them on.

Je me souviens.

#57 Habitt on 05.15.22 at 4:38 pm

Rates go up prices come down is what has been repeated here for awhile. The government knew what to do. But then there’s those pesky voting blocs getting windfalls. Best tread lightly votes count lol. Oh wait the country needs a plan. Best increase demand and keep the party going. Ya know I’m the name of fairness. Get out of the way works.

#58 Søren Angst on 05.15.22 at 4:59 pm

Blaming the CB is completely puerile. – Garth

Ouch.

Though I have to say, I have always loved the word “puerile”. Like THE go to card when you lay your Poker hand down with all the chips on the table.

Thank Roma* and Latin for that word.

* 2,775th anniversary, 21 April 2022.

Caput Mundi.

#59 TheDood on 05.15.22 at 5:01 pm

#19 Joel on 05.15.22 at 1:13 pm
Living on vancouver island we have held out reading your blog.

BUT, right now this is the most houses we have seen since they start of WFH. What are the key indicators we should look for to be back in the market for buying.

This will be our permanent residence and first buy in our mid 30’s but nobody wants to buy a house then end up in negative equity
__________________________________

Patience.

Wait for it. If you’re comfortable renting, continue to do. Prices crested only a few months ago. Rates are going to continue going up for some time. Those who have to sell will be doing so at the whims of buyers (like yourself), who will be able to set conditions and turn your nose up at the slightest spec of dust on the window sill. I wouldn’t listen to anyone who tells you immigration and offshore money is going to keep prices high. Not happening. Interest rates are going up for years to come, that means prices are coming down.

#60 Calgary on 05.15.22 at 5:01 pm

Is mortgage rate @16% possible within 3 years?

#61 Wandering Wonder on 05.15.22 at 5:15 pm

Gezz… Central banker’s seem to get all the blame lately.
I for one am very fond and glad they try their damnedest to be not political.

I was actually quite pleased with Pierre Poilievre shaking things up a bit, but no longer. he’s just seems to ignorant of what central bank’s do.

#62 Robert S. on 05.15.22 at 5:20 pm

OSFI is a government agency. The Bank of Canada is not. Firing Macklem would send shockwaves beyond Canada and do substantial damage. PP is grandstanding. He has created a false target. Do not fall for it. – Garth
_________________

What’s wrong with a false target? You are so worried about PP…more than half the things he’ll never do, including have lunch with Tamara. You too are “falling for it.” PP is roping in the true conservative for the vote, then he’ll dummy down his politics to attract the center. You’ve been in politics long enough to see the pieces. Chess, not checkers. I can’t wait to see him go up against Trudeau. Smudge that narcissistic dictator across the dirty floor he slithers on. Even Joe Rogan agrees. That, after Jordan Peterson…but you probably think those two are Joe Dirt as well. PP for Pres.

Joe Rogan? Seriously? Then you deserve Polievre. – Garth

#63 Rudolf Samoszynski on 05.15.22 at 5:31 pm

The pandemic is not over. Why are you lying?

Covid is not over. The pandemic is. – Garth

#64 Martha Flanders on 05.15.22 at 5:44 pm

Won’t someone think of the work from home Toronto Yuppie couple who just bought their Barrie home for a million dollars?

#65 Reality Check on 05.15.22 at 5:51 pm

There is no free lunch on interest rates. Canada cannot diverge greatly from the world trend in rates. If we think somehow Canada is going to keep rates low while the rest of the developed world raises rate to reverse inflation, good luck. If our interest rates lag rates around the world the dollar drops – perhaps all the way back to 2001 levels. Which causes more inflation due to higher import costs. And our exported goods become more competitive which causes our economy to overheat which causes more inflation.

BoC is truly between a rock and hard place.

#66 Barb on 05.15.22 at 5:55 pm

#30 Danger Dan on 05.15.22 at 2:01 pm

I wouldn’t put it past our enlightened government to impose price controls on fuel as inflation rages.
——————————–
Not gonna happen.
Lotsa money landing in provincial and federal coffers from all those per litre taxes.

https://en.wikipedia.org/wiki/Motor_fuel_taxes_in_Canada

#67 Mark on 05.15.22 at 6:07 pm

Pay no attention to CMHC, and the fact that it is backstopping all the risk from the banks. Or the fact that housing prices started going parabolic shortly after CMHC was started. Allowing banks to lend out money with significantly less risk is DEFINITELY NOT a contributing factor to canadian “investors” over-leveraging and using their heloc to buy more and more properties. Carry on, nothing to see here. Keep blaming lack of supply, foreign investors, etc etc etc.
My kingdom for a politician who is honest about housing. Might be time to vote NDP after all, they seem to be getting closer than anyone else. Never thought we would live to see the day that voting NDP made the most sense. madness everywhere.

#68 I fixed the comment on 05.15.22 at 6:17 pm

You are wrong. The BoC dropped rates and bought bonds to reduce yields, expand credit and save the economy from a pandemic disaster. It succeeded. CBs in every western country did the same to deal with a one-in-a-century event of cretinism, overall global corruption and stupidity putting monetary policy in support of transnational billionaires and virologists like Bill Gates. Now it’s in reverse and people silly enough to think 2% mortgages and 20% annual house price gains were normal will learn otherwise. Blaming the CB is completely puerile. – Garth

It was a trap for the lemmings and in Canada they are 80 percent of them…wink, wink

#69 Faron on 05.15.22 at 6:18 pm

#12 Sail Away on 05.15.22 at 12:41 pm

that even leads to completely fabricating

Oh, is that the Steele Dossier that the FBI was mostly ignoring and sitting on because it wasn’t verifiable? Is this the investigation that lead to indictments of numerous people in the Trump camp for lying to the FBI among other serious charges? The same one that lead to:

…US government inquiries uncovered dozens of contacts between Trump campaign associates and Russians, which have since been acknowledged. The candidate himself and his closest advisers even welcomed the Kremlin’s interference in the election.

(from your CNN article)? The one in which Trump was never under investigation according to the FBI?

Just checking.

#70 Sam on 05.15.22 at 6:27 pm

Those who tell you that the stock market outperforms over the long-term, left out some important details. After the 1929 the market declined 90% in 3 years and then it took 25 years to get back to the 1929 peak. Ask yourself if you can handle that kind of pain.

It’s not 1929. – Garth

#71 IHCTD9 on 05.15.22 at 6:28 pm

Well, the BOC will be in the woods for a while yet. These diesel prices still have to work their way thru the system, and supply chains would be lucky to repair by the end of 2023. Lots of runway for increases. IMHO, rates will be high enough by the time OSFI ever drops the stress test that it won’t matter. The Banks can suck it, they’ve made puh-lenty during Trudeau’s disastrous tenure in office.

Once the flock is spooked, they all crow at the same. No one is concentrating on market sentiments much, but FOMO got us where we are, and FOOP will bring us back. We might even enter the SORE stage (scared of real estate), that could result in the 90’s reoccurring.

As far as PP/JC is concerned, either one gets my vote. Trudeau has destroyed Canada’s finances, and sat on his hands while house prices went berserk. Now it appears we are on the eve of RE destruction. If you’re a specuvestor or a M+P LL, you can thank Trudeau and your own feeble IQ for your miserable condition. It would be sweet, sweet irony if you happened to vote for Trudeau as well.

Either way, the IH collective backs up the truck – especially if Trudeau wins again (The local YAMAHA and GMC dealerships are already sending me pro-Trudeau propaganda).

#72 PeterfromCalgary on 05.15.22 at 6:34 pm

“Suggest areas of government cutbacks – something meaningful (which excludes dumping on civil servants). Child benefit? OAS? Defence? Indigenous? Provincial transfers? – Garth”

Stop funding the CBC and sell its assets.

Eliminate subsidies to newspapers

Cut provincial transfers by 2%

Eliminate environment Canada (the provinces have their own environmental departments)

Reduce government travel by 50% and use secure virtual meetings instead.

Keep government vehicles for 15 years or until they have major repairs that are not worth fixing.

Eliminate building any new infrastructure for two years except for public health like sewers/ water or projects that have already broke ground.

Freeze civil service hiring for 3 years or until inflation falls below 3%.

Stop subsidizing the purchase of electric vehicles and charging stations.

Save on administrative costs by eliminating the carbon tax. It is revenue neutral with the rebates so this will not reduce government funding.

#73 BCWally on 05.15.22 at 6:34 pm

I can’t see why people think there will be a way out of a massive housing bust.
If the BOC doesn’t fight inflation, base costs for everything else will continue to rise until mortgage payments can’t be made. I just bought a “half” package of bacon for over $8.
If interest rates rise enough to tame inflation mortgage payments can’t be made. Historically, inflation has only been beaten when interest rates have risen above the rate of inflation. I’m really curious on how to tame demand on essentials though, with supply side issues.
Biggest factor forgotten in all this are the Americans. They don’t have a big housing debt problem, they have a labor shortage, and they have the lowest debt delinquency ever. They can go way farther than we can with rate increases.
We have to maintain a currency value with NAFTA so we will have to follow the Fed.
Mr. Poilievre is delusional of course. Trouble is his fan base of discontents is growing. I’m not sure but it looks to me like he supports higher rates.
I believe anything he does if elected will crash the housing market without help from the BOC.
Would it be fair to compare the 31% of homes that belong to Canadian multiple home owners in Ontario and BC to the leveraged tech or meme stock investor?

#74 Joe on 05.15.22 at 6:46 pm

Unfortunately Millenials will keep house prices high, everyone forgets about demographics

#75 HUNGRY BEAR on 05.15.22 at 6:51 pm

Suggest areas of government cutbacks – something meaningful (which excludes dumping on civil servants). Child benefit? OAS? Defence? Indigenous? Provincial transfers? – Garth
—————————————–
Indigenous?

Hey whats your problem with the Native community. You white old privileged men destroyed their culture with RESIDENTIAL schooling and now you want to keep taking from them as if ripping a child out of their mothers hands and sending them to a death camp wasn’t bad enough.

Stop standing on the GRAVES of those innocent children!!!!

You just earned a forever ban from this site. – Garth

#76 Philco on 05.15.22 at 6:53 pm

Joe Rogan? Seriously? Then you deserve Polievre. – Garth

Garth….WHO DO we deserve please do tell??
You have a great ability to call everyone out for their short comings and pretty silent onT2. Silence speaks volumes there.
WHO SHOULD LEAD THIS FAILING…WEEK COUNTRY.

Maybe we have to dig up Ralf?

#77 Philco on 05.15.22 at 6:55 pm

WEAK
Thats what happens when they teach you to spell phonetically. Good thing my maths good

#78 Sail Away on 05.15.22 at 7:08 pm

@Faron:

Funny that the next two sentences were omitted from your snip. Let me help, but, in general, one should read the entire discussion:

‘Still, none of it added up to the collusion suggested in Steele’s memos.

Legitimate questions are now being raised about the dossier — how it was used by Democrats as a political weapon against Trump, how it was handled by the FBI and US intelligence agencies, and how it was portrayed in the mainstream media.’

#79 avocado on 05.15.22 at 7:12 pm

It will be interesting to see how lockstep canada and the US will be with rates. American households tend to have 30-year fixed mortgages and are less sensitive to rate changes. I could see the US tightening more quickly, leading to a lower CAD vs USD. Long gone are the days of expensive oil = strong CAD.

#80 Ponzius Pilatus on 05.15.22 at 7:18 pm

#72 Pietro de Calgaria
Stop subsidizing the purchase of electric vehicles and charging stations.
———
Agree.
Put the money towards implementing, developing alternative energy sources.

#81 Flop… on 05.15.22 at 7:42 pm

I’ll have look and a nibble at the markets this week, contrary to to the advice in this song.

Real Estate?

Maybe in New Zealand or Fiji…

M47BC

Just Looking by Stereophonics.

There’s things I want
There’s things I think I want
There’s things I’ve had
There’s things I want to have

Do I want the dreams
The ones we’re forced to see
Do I want the perfect wife
The word perfect ain’t quite right

Shopping every day
Take it back the next break
They say the more you fly the more you
Risk your life

I’m just looking

I’m not buying

I’m just looking

keeps me smiling

A house I seen another could’a been
You drenched my head and said what I said
You said that life is what you make of it
Yet most of us just fake

I’m just looking, I’m not buying
I’m just looking, keeps me smiling

https://www.youtube.com/watch?v=Xy3T8FmyeE8

#82 45north on 05.15.22 at 7:49 pm

ironic

For two years most elections have been fought on getting real estate prices down and affordability up. It’s happening again in Ontario ahead of the June 2nd vote. This has been a defining issue for Canadians, and to date no government has been effective in reducing property values by a single dollar.

The Ontario Government commissioned the Housing Affordability Task Force which recommended that zoning restrictions be removed. Reading the Report, I got the impression that municipal governments would be neutered and that anything of consequence would be governed by the Ontario Ministry of Housing. The follow-up legislation is ironic. Bill 109 “More Homes for Everyone” sets rules for the process of getting site approvals. There are dozens of reasons for delays in site approvals. Some are the fault of the municipalities, some are not. The process is so obscure that Housing Affordability is effectively removed from the election June 2.

Robert Kavcic, senior economist at BMO says that the plan to double the rate of construction of homes is unrealistic. There are labour and material shortages. You just cannot do it.

I think with the downward slide in the housing market, the rate of construction will slow. Labour and material costs are rising but house prices are falling. Doesn’t seem like a good time to “bet the company”.

#83 Quintilian on 05.15.22 at 7:51 pm

#73 BCWally on 05.15.22 at 6:34 pm
“Mr. Poilievre is delusional of course. Trouble is his fan base of discontents is growing. I’m not sure but it looks to me like he supports higher rates.”

You are too kind Wally calling PP’s fan base discontents.

But I am at a loss for words to adequately describe the ones on this blog.

Their motivation is highly suspect, they have no principles and have shown that by omission.

Most of them are xenophobic, yet they rather not talk about the fact that at the recent debate, all of the candidates stated that they were in favour of greater immigration numbers than what the Liberals propose.

Sure, they used weasel words to camouflage their position, but they are deceiving their own base.

Is it one of those “the emperor has no clothes” deal ?

#84 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 05.15.22 at 7:52 pm

Don’t worry, Auston, Mitch, John, Morgan, William, Kyle, Sheldon and all your bros – you have some time now to get your Realtor license and do what really counts in the GTA – dupe more losers into buying overpriced shacks at bubble-top prices!

WooHoo!

https://www.youtube.com/watch?v=jiZ-hpXzFq0

#85 fishman on 05.15.22 at 7:54 pm

Whats ironic is that the Eastern moderate block of conservatives have done the bait & switch so often that now their going to have to go with PP. He’s got the Western base nailed down. If the Easterners gang up & defeat PP for another Laurentian elite shill, that base will splinter & stay home. The cons will never get in losing the West. So its a maybe get rid of lil potato with PP or no chance without PP. We’ve watched the Never Trumpers & Neo-Cons do everything to break apart the Trumpistas. As long as the base holds, then the independents got to come over to the good guys side. The only chance for Canuckleheads & Yankees to fumigate the swamp critters down to a tolerable level.

What is the ‘Laurentian elite’? Did you hayseeds just make it up? – Garth

#86 Drinking on 05.15.22 at 7:59 pm

#11 the Jaguar

I have respect for you as well as a few other long term posters. Like you, never thought that I would post again but your statement is one that I agree hope others see/read between the lines. Buckle up people this winter will be VERY challenging!!!

#87 wallflower on 05.15.22 at 8:17 pm

more crickets on the open houses today

#88 Brady bunch on 05.15.22 at 8:20 pm

That giant sound you heard was the housing market starting to crack.

#89 HUNGRY BEAR on 05.15.22 at 8:24 pm

BANNED

#90 Brady bunch on 05.15.22 at 8:26 pm

#60 Calgary on 05.15.22 at 5:01 pm
Is mortgage rate @16% possible within 3 years?

Possibly but I think there is a greater chance you find a loaf of bread selling for $30 before that. Their goal is to collapse the west so they can “build back better” aka. one global govt under the WEF, UN, WHO

#91 DON on 05.15.22 at 8:39 pm

#74 Joe on 05.15.22 at 6:46 pm
Unfortunately Millenials will keep house prices high, everyone forgets about demographics

**************
More like everyone forgets history. The Boomers had numbers and they experienced a housing bubble when they were the same ages as the Mills.

Too bad you can’t smoke hopium.

#92 crowdedelevatorfartz on 05.15.22 at 9:11 pm

@#75 Banned Bear
“…..ripping a child out of their mothers hands and sending them to a death camp….”

+++
Residential Schools were “death camps”…?

Wow.

#93 Nonplused on 05.15.22 at 9:14 pm

I don’t know that it matters whether the BOC gets more politicized or not. What ever happens they must substantially follow the US Fed. A bit of variation perhaps to affect the dollar, but that’s about it.

If the BOC goes too far above the Fed, then a rush of investment dollars will drive up the Can$, so that won’t happen. If the BOC goes too far below the Fed, the opposite happens. So we don’t have to spend too much time thinking about the BOC.

#94 Satori on 05.15.22 at 9:18 pm

#79 willworkforpickles on 05.15.22 at 6:58 pm
#77 Satori
I could go over the details to your questions to DD myself….
—————————–
hmmm, so if we are heading into a Recession – housing drops is a given …. but so does the Stock Market!

Can someone please tell me then, what is a safe investment during these times? If they are both heading for a big fall? Am I missing something here or are we all just putting both our eyes on the housing market and completely forgetting altogether, that the stock market will fall too?

(thanks WWFP)

Why would stocks decline in a hot economy just because 9% of Canadians enter mortgage misery? – Garth

#95 crowdedelevatorfartz on 05.15.22 at 9:41 pm

@#80 Ponzie’s Petroleum Paradigm
“Put the money towards implementing, developing alternative energy sources.”

++++

Yep.
Geo thermal.
Endless power beneath the feet of everyone on the planet.

Some places closer to the heat than others.

https://biv.com/article/2021/12/proposed-mt-meager-geothermal-plant-takes-another-step-towards-operating

#96 CL on 05.15.22 at 9:41 pm

As I said here awhile ago, the stress test will be eliminated. They’re not going to make people qualify at 7%.

They’ve painted themselves in to a corner with years of rate declines, causing asset inflation (stock markets, housing and now my Corolla) and they find making people take harsh medicine not palatable politics.

Say what you will about CB’s, it’s always about politics regardless of how many times someone says they’re “independent “.

#97 Midnight’s on 05.15.22 at 9:47 pm

DELETED

#98 Ponzius Pilatus on 05.15.22 at 9:48 pm

#80 Shawn on 05.15.22 at 7:30 pm
Facism?

I’m sure most people don’t ahve a good idea of what it means. Here’s the main definition from Google:

1. or Fascism : a way of organizing a society in which a government ruled by a dictator controls the lives of the people and in which people are not allowed to disagree with the government.

Dictionary.com says:

Facism: a governmental system led by a dictator having complete power, forcibly suppressing opposition and criticism, regimenting all industry, commerce, etc., and emphasizing an aggressive nationalism and often racism.

On that basis, Russia under Putin is surely a facist country?
———–
I’m not much into the “isms”.
The definitions could also be used to describe Dictatorship or Communism.
But historically, Facism has been equated with Franco in Spain, Mussolini in “Italia” and Hitler in Germany.

#99 Capt. Serious on 05.15.22 at 10:06 pm

So, if the CBs intend to fix the supply issues with blunt interest rate increases I guess we might as well start polishing our resumes because a lot of us will be unemployed. Causing unemployment to reduce demand is a terrible way to fix a supply chain issue. Do they think it’s easier for corporations facing higher debt servicing costs to fix supply chain issues? Of course not. They will have to crush demand if it comes to that. I mean, see the Fed circa 1981. They know it works.

#100 THE DANDADA on 05.15.22 at 10:19 pm

WHO knows a very good above-ground pool deck builder in south-western Ontario?

This is not Kijiji. – Garth

#101 Reality is stark on 05.15.22 at 10:47 pm

What comes next is easy.
Double property taxes over 5 years.
House prices will come down and everyone will be happy.
You don’t need to do anything fancy.
The government will be proud of the fact that they “solved another problem”.

#102 THE DANDADA on 05.15.22 at 10:49 pm

hayseeds ……… LMFAO!!!

#103 Faron on 05.15.22 at 10:50 pm

#78 Sail Away on 05.15.22 at 7:08 pm

So the oppo research funded by Clinton that helped reveal crimes among Trump campaign members and the Russians who orchestrated the email releases was a bad thing? I would think a law and order kinda guy would celebrate such laudable prosecutions.

Very interesting that this is on your radar. Why?

#104 willworkforpickles on 05.15.22 at 11:06 pm

#79 willworkforpickles on 05.15.22 at 6:58 pm
#77 Satori
I could go over the details to your questions to DD myself….
—————————–
hmmm, so if we are heading into a Recession – housing drops is a given …. but so does the Stock Market!

“Why would stocks decline in a hot economy just because 9% of Canadians enter mortgage misery? –
Garth”
………………………………………………………………………………………………………

So as not to be flagged again with regard to our very different takes on the economy , (Mine and Garth’s) I will leave the question of the economy out of this. I do however agree with Garth regarding where the stock market doesn’t necessarily correlate to the RE market.

If we are heading into a recession , and i won’t say what i have to say on that issue here now either , the Fed will react with the next round of QE (cb’s will follow in kind) and abandon QT which hasn’t even completely begun as of yet to keep the markets upright.

What that will do to the dollar and for inflation i won’t repeat but let you know when just one more of my many projections for down the road comes to pass as many have and still are.

Still batting a thousand in that regard at any rate.

As to gauge where we are likely headed…re-read my post in yesterdays string.

#105 John on 05.15.22 at 11:25 pm

Bear markets still in play. Down…down…down we go on the markets tomorrow and throughout the week…..through the month of May and into June….July….August….September etc… until the rate hikes are paused rate cuts are implemented and QE infinity is re-launched. There is no way governments, corporations and individuals with the debt loads we all have can sustain afford or survive these higher rates. I predict rate hikes will pause and then begin to reverse once again this summer.
P.S. If Russia is pushed into too tight a corner by the rest of the world then I predict Putin WILL use nuclear weapons in a scorched earth exit out of this world. Then it will all be over. There will be no need to short the markets after this happens since there will be nobody left to settle your trade. If it’s the end of the world the best investment strategy would be to go long!

#106 Bdwy on 05.15.22 at 11:32 pm

72 PeterfromCalgary on 05.15.22 at 6:34 pm

…….
Peter can you be the Prime Minister?

Nice list.

#107 Furbearing on 05.15.22 at 11:43 pm

NDP promises 6 years of deficits. Why wouldn’t they think this hook wouldn’t work again after Trudeau promised a trillion dollar debt and got elected? Fundamentally people are obviously stupid for what the perceive as ‘free stuff’.

Of course we know that all this stuff comes with a flaming bag of higher direct and indirect taxes. We’re like heroin addicts who shoot and shoot knowing our lives are spiraling into collapsing around the toilet behind an Couche Tard truck stop washroom, but we shoot some more because the future is too awful to conceive. And sadly like an addict prostitute Canadian consumers are shooting the drug called debt until it inevitably kills them.

But really, if democracies are dependent on leadership then who’s the pusher? Who’s the soulless pimp pushing the drug of debt on innocent civilians. Promising country killing deficits and debt is something like cartels do when they mix fentanyl into gummies to sell to middle school kids that gets them started on the road to a lifetime Olof addiction. Does this make Liberals and NDP immoral cartels? You decide.

Meanwhile North Korea isolated away from the world with a senseless army and slavish media is now a hotbed of Covid at around a million cases daily. This is what happens when government gain too much power with a strong man controlling the message. Wake up Canada.

#108 Matt on 05.15.22 at 11:52 pm

I’m not an economics major (or even someone that understands the basics), just a guy who has sat out the housing market for the last 10 years on the very simple calculation of rent being much less than mortgage interest wherever I happened to be. So I saved and invested, but the end game is still buying a home eventually!

But I have a question that maybe someone smarter than me can answer. If housing prices are so important (and I believe that they are), why aren’t they included in the calculation of inflation? If they were, wouldn’t we have seen inflation rise earlier (and rates come up to address it), before the price explosion of the last few years happened?

#109 Bdwy on 05.16.22 at 12:06 am

Endless power beneath the feet of everyone on the planet.
…..
ultra low grade energy. Some warm rocks won’t make much kwh. No # listed for this = puny.
Fantastic to heat your house if you happen to live on a volcano.

Far to many out there have no understanding of energy and blab on and on about investing in alternate sources.

#110 IHCTD9 on 05.16.22 at 12:08 am

DELETED

#111 THE DANDADA on 05.16.22 at 12:18 am

#108 Matt on 05.15.22 at 11:52 pm

why aren’t they included in the calculation of inflation?
====================================

Because crooked politicians and BOC members want to skew the numbers to fit their agenda so they can look good and keep their cushy government jobs.

————————————————————

#112 Ponzius Pilatus on 05.16.22 at 1:05 am

Bring on the Battle of Alberta!

#113 PeterfromCalgary on 05.16.22 at 1:24 am

“If housing prices are so important (and I believe that they are), why aren’t they included in the calculation of inflation? ”

It is a confusing issue but here is my shot at explaining it.

Housing prices reflect the value of being housed many decades into the future. You do no consume a house the moment you buy it. Rents are a better reflection of what the cost of consuming and keeping up a house is on a monthly basis.

The Bank of Canada wrote a paper on this issue. I should warn you it is not what I would call an easy read.

https://www.bankofcanada.ca/wp-content/uploads/2015/11/boc-review-autumn15-sabourin.pdf

#114 fishman on 05.16.22 at 1:53 am

Funny enough hayseeds & Laurentian elites have something in common. Vancouver is the western outpost of Canada’s Laurentian elite. These western elites daughters have horses. The rich horsey set in town have bought up all the river bottom hay meadows in the B.C. interior that they can get their hands on. These meadows are hard to value because their illiquid. Nobody sells. You got lots of dough to be called a hayseed in B.C.

#115 Bonobo on 05.16.22 at 2:36 am

I’ll tell you what happens next Garth…

Home prices will continue to go up over the coming years. I’ve been reading you blog almost since it first went live and in all this time home prices have always gone up.

In the next 20 years they will continue to go up.

That’s all I have to say about this.

#116 under the radar on 05.16.22 at 4:46 am

Torrid economic expansion after 2 years of forced demand destruction and trillions of government dollars , a war, energy turmoil and the second largest economy in the world chasing a zero virus policy further disrupting supply chains and bang, rapidly rising rates to curb unacceptably high inflation gives people a swift kick in the pocket book and suddenly real estate prices start to slide lower while the price of gas doubles and dinner out is $$$$. And people wonder how we got here.

#117 The Regulator on 05.16.22 at 7:26 am

The Governor of the Bank of Canada is a GOD. Bow down and worship our creator of money from nothing. Some guy called it mammon, can’t remember his name.

So how is that Russian email-hosting service you use? – Garth

#118 TurnerNation on 05.16.22 at 8:00 am

The War on Small Business continues. Life is good for the global corps.

“Canadian business insolvency filings increased the most in 31 years last quarter, and rising interest rates could push the number even higher, according to the Canadian Association of Insolvency and Restructuring Professionals (CAIRP).
Business insolvency filings in Canada rose 33.8% in the first quarter compared with the same quarter last year, according to data from the Office of the Superintendent of Bankruptcy. (investmentexecutive.com)


— More engineered shortages, famines in the Former First World Countries.
This is Global WW3, kicked off March 2020. Guess who is is targets. No, guess…
Expect shortages, rationing

“Electricity Shortage Warnings Grow Across U.S.
Power-grid operators caution that electricity supplies aren’t keeping up with demand amid transition to cleaner forms of energy
From California to Texas to Indiana, electric-grid operators are warning that power-generating capacity is struggling to keep up with demand, a gap that could lead to rolling blackouts during heat waves or other peak periods as soon as this year.”
https://www.wsj.com/amp/articles/electricity-shortage-warnings-grow-across-u-s-11652002380

#119 Robert S. on 05.16.22 at 8:04 am

DELETED (Anti-vaccine)

#120 crowdedelevatorfartz on 05.16.22 at 8:27 am

@#108 Matt
“But I have a question that maybe someone smarter than me can answer. If housing prices are so important (and I believe that they are), why aren’t they included in the calculation of inflation? If they were, wouldn’t we have seen inflation rise earlier (and rates come up to address it), before the price explosion of the last few years happened?”

+++
Yes housing prices should be included in inflation calculations.
But the Lobbyists and political cash contributors at every real estate cartel in Canadaland know that would be bad for biz.
So here we are.
Our toes hanging over the precipice as we stare at the debt abyss.

#121 crowdedelevatorfartz on 05.16.22 at 8:35 am

The Laurentian Elite as described in an op ed piece of the Nat Post.

https://nationalpost.com/opinion/1206-ed-weissenberger

Fishman isn’t off the mark.

PP resonates with the great unwashed base and Conservatives that turn their nose up at his attack dog style better get used to the idea that he will lead the Party because his closest rival in the race….aint cutting the mustard now ….or two years from now with voters.

Poilievre may be unelectable against Trudeau but neither are any of the other bland, politically correct, do nothing, has beens that are jocking for position in the sheep pen.

Comments like this help weaken and divide our nation. Was that your intent? – Garth

#122 Sail Away on 05.16.22 at 9:51 am

#103 Faron on 05.15.22 at 10:50 pm

Very interesting that this [Steele dossier] is on your radar. Why?

———-

Well, it’s on an entire country’s radar. It shows underhanded dealing at the highest level. Let me simplify for your edification:

1. Fabricated document containing treasonous allegations
2. Funded by members of the elected and appointed political opposition
3. Leaked to the press on a silver platter and published in its entirety… without verification of veracity
4. This is bad

Why is the dossier on my radar? Well, for the same reasons it is on the radar of millions of others: False allegations of treason joyfully funded, promoted and published by opposition political party. Fake news now verified as, actually, you know, fake.

Better?

#123 Bitcoin Bro on 05.16.22 at 10:30 am

Hilarious.

CBs have literally just started extremely mild policy tightening (compared to the 70’s and 80s) and they’re already throwing caveats out there, searching for any excuse to keep the free and easy money policy in place.

MMT forever baby!!! Who cares about the plebs, that’s what food banks and rent assistance are for amirite? Messing currency never goes wrong!

#124 TurnerNation on 05.16.22 at 10:32 am

The Left’s cruelty knows no bounds. These champagne socialists cheering $2 gas prices and in oblivious to the plight of say a single mother paying $25 more each week while commuting to their job. Pour another one Lefties, countdown to your DB pension. These little people will not bother you.

—-
#29 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 05.15.22 at 1:58 pm

People go to a brawl and a hockey game broke out.

https://www.blogto.com/sports_play/2022/05/brawl-scotiabank-arena-toronto-maple-leafs-game/

—-
—-

— As I’ve been saying for a while now you will be wearing Your Mask until 2025 at least if not forever. Smiles are banned in the new global system Almost back to normal, any day now!

.Ford, Stellantis to reinstate mask mandate at most Michigan facilities (detroitnews.com)

.Schools in Maine, Indiana, Hawaii, and other U.S. states are once again requiring students to mask up in classrooms(fox42kptm.com)
.Pittsburgh Public Schools, Woodland Hills reinstate masks as COVID cases rise in Allegheny County (post-gazette.com)

.As Washington’s Metro considers mask-only train car, commuters press NJ Transit to test idea(nj.com)

.Italy Will Not Abolish Face Mask Requirement on Flights Until June 15, Despite EU Recommendation(schengenvisainfo.com)

#125 Shawn on 05.16.22 at 10:34 am

Yes, Housing COSTS are included in Inflation, CPI

#120 crowdedelevatorfartz on 05.16.22 at 8:27 am
@#108 Matt
“But I have a question that maybe someone smarter than me can answer. If housing prices are so important (and I believe that they are), why aren’t they included in the calculation of inflation? If they were, wouldn’t we have seen inflation rise earlier (and rates come up to address it), before the price explosion of the last few years happened?”

+++
Yes housing prices should be included in inflation calculations.
But the Lobbyists and political cash contributors at every real estate cartel in Canadaland know that would be bad for biz.
So here we are.
Our toes hanging over the precipice as we stare at the debt abyss.

**********************************
Okay so housing prices are not directly included in CPI because unlike food and energy and cloths ans such a tiny percent of the population buys a new a house in a given month.

AND virtually no one pays for a house all at once out of their income, again unlike food, energy, clothing etc.

AND a lot of people rent.

SO30% of the basket weight in CPI

SO, the cost of housing (shelte) rather than the price of a house is included in CPI. In fact it’s a massive 30%! of the basket weight.

Please stop spreading this conspiracy theory that the higher cost of housing is not included in CPI.

How many times do I have to point this out and give the link?

https://www150.statcan.gc.ca/n1/pub/71-607-x/2018016/cpi-ipc-eng.htm

#126 Dharma Bum on 05.16.22 at 10:37 am

#115 Bonobo

In the next 20 years they will continue to go up.
—————————————————————————————————-

I agree.

In 20 years, home prices (in real dollars) will be higher than what they are today.

But, for the next 18-30 months, there will be some flatlining and receding of prices.

Recency bias will make the masses freak outta their skulls. Many will bail, panic, have a caniption, whatever.

The 20 year rise is inevitable, but it will not be linear.
——^
^
^
^
—^— ^
-^- -^- ^-
-^- —^— —
– –^–
– —

#127 Shawn on 05.16.22 at 10:39 am

Housing costs and prices and CPI

#113 PeterfromCalgary on 05.16.22 at 1:24 am
“If housing prices are so important (and I believe that they are), why aren’t they included in the calculation of inflation? ”

It is a confusing issue but here is my shot at explaining it.

Housing prices reflect the value of being housed many decades into the future. You do no consume a house the moment you buy it. Rents are a better reflection of what the cost of consuming and keeping up a house is on a monthly basis.

********************
Exactly!

#128 Quintilian on 05.16.22 at 10:39 am

#121 crowdedelevatorfartz on 05.16.22 at 8:35 am
“Poilievre may be unelectable against Trudeau but neither are any of the other bland, politically correct, do nothing, has beens that are jocking for position in the sheep pen.”

“Comments like this help weaken and divide our nation. Was that your intent? – Garth”

I see Garth, let’s be polite Canadians, truth be dammed.
If you conservatives don’t look in the mirror and have an honest conversation, you risk inviting a Trump.

Miss the point much? – Garth

#129 Ponzius Pilatus on 05.16.22 at 10:51 am

#118 TN
From California to Texas to Indiana, electric-grid operators are warning that power-generating capacity is struggling to keep up with demand, a gap that could lead to rolling blackouts during heat waves or other peak periods as soon as this year.
———————-
Texan power grid last year was a few hours away from complete shutdown last summer.
That’s what low taxes get you.
No money for infra structure upgrades.
And did I mention the hurricanes?
Sure move there.

#130 Ponzius Pilatus on 05.16.22 at 11:01 am

120 crowdedelevatorfartz on 05.16.22 at 8:27 am
@#108 Matt
“But I have a question that maybe someone smarter than me can answer. If housing prices are so important (and I believe that they are), why aren’t they included in the calculation of inflation? If they were, wouldn’t we have seen inflation rise earlier (and rates come up to address it), before the price explosion of the last few years happened?”

+++
Yes housing prices should be included in inflation calculations.
But the Lobbyists and political cash contributors at every real estate cartel in Canadaland know that would be bad for biz.
So here we are.
Our toes hanging over the precipice as we stare at the debt abyss.
————————-
From the way I understand it, house prices are included in the CPI.
But not directly.
The formula is a little complicated and “may” be subject to interpretation by the Gubermant.

#131 Faron on 05.16.22 at 11:22 am

#122 Sail Away on 05.16.22 at 9:51 am

#103 Faron on 05.15.22 at 10:50 pm

Very interesting that this [Steele dossier] is on your radar. Why?

———-

Well, it’s on an entire country’s radar.

Is it? Your article is 6 months old. I haven’t seen it in any headlines. Something caused you to go digging. Gonna guess that something is along the lines of bizpacreview or Fox News or some weird newsletter that all have an agenda for you (that agenda would be distracting you from something else that is currently more relevant, but less favourable to conservatives like maybe the racist murder of a half score of black people in Buffalo?).

Regardless:

1) Steele is a Brit. How is that treason? Furthermore, given the actual indictments, prosecutions and convictions of Trump associates, it’s not treasonous to consider other allegations. I’ll remind you that the most salacious (of numerous) reports from Steele was widely known and panned by intelligence and media because it was unverifiable.

2) Opposition research is done by both parties and will frequently uncover rumours and half-truths. And funded by one of the two parties, both of which will have someone in power? Duh?

3) It’s not a leak if the dossier is opposition research rather than a CIA/NSA/FBI document, right? You acknowledge that this was a campaign/party funded effort, thus not a state secret. Correct?

I’ll make it easier for you: If I hire someone to dig up dirt on you and they report to me with said dirt and I go public with it, that’s not a leak even if I also sent that doc to CSIS. Get it?

Did intelligence have good reason to be concerned about Trump Campaign/Russian connections at that point? Yes, absolutely. Did Steele have a good reputation at that point? Yes, he had contributed important information in at least two cases that lead to FBI indictments. But that doesn’t make it a leak of classified material.

I’ll state more clearly that media and members of congress had been batting this thing around for weeks. They didn’t raise it because of the questionable allegations. It wasn’t until Buzzfeed decided to publish (along with a note describing their reservations and the purpose) it that it was made public.

4) No, it’s not. It sounds like the FBI is pursuing Steele’s source. That is where any badness lies and that is the proper course. To draw a comparison, the guy you are defending, Donald J. Trump, repeatedly and utterly falsely claimed on national media that a sitting president was a foreign national. Yes, that is a whattaboutism, but it’s also useful for setting a frame of reference for bad deeds.

Better?

Generously? Maybe a few cms worth of better on a scale measured in kms. So, still quite terrible.

I remain extremely curious why you are down the rabbit hole on this right now. My hypothesis is that it’s a conservative media distraction from the clearly racist buffalo shooting done in the name of the fake “replacement theory”; a common refrain of Tucker Carlson and was the chant of the unite the right marchers in Charlottesville. You are a truly excellent canary Sail Away. Thank you for bringing this bait and switch to my attention.

#132 pPrasseur on 05.16.22 at 11:50 am

#108 Matt – If housing prices are so important (and I believe that they are), why aren’t they included in the calculation of inflation?

The reason is because current home prices don’t affect everyone, just those who have bought recently, millions of others have bought a long time ago at very different prices.

That being said this metric is as you said very important, it tells a lot for example about availability of credit, the way it is handled of even manipulated in the country. It is not the regular kind of inflation per say but still is a direct result of monetary/credit tampering in this country so in fact it is inflation, just a different kind.

#133 DON on 05.16.22 at 11:52 am

#115 Bonobo on 05.16.22 at 2:36 am
I’ll tell you what happens next Garth…

Home prices will continue to go up over the coming years. I’ve been reading you blog almost since it first went live and in all this time home prices have always gone up.

In the next 20 years they will continue to go up.

That’s all I have to say about this

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

https://www.bloomberg.com/news/articles/2022-05-16/canadian-home-prices-post-first-drop-in-two-years-on-rate-hikes.

Hmmmm! Guess you should have waited till todau to post.

#134 The Regulator on 05.16.22 at 12:02 pm

#117 – So how is that Russian e-mail hosting service you’re using? – Garth
Pretty good. It doesn’t bury vital information(truth), like Google/Alphabet does soooo well. You should try it.

#135 The Regulator on 05.16.22 at 12:10 pm

European Union will need to re-tool ALL their refineries that normally use Ural. You can’t just flip a switch and start refining Alberta dil-bit. Ask any refinery operator. The E.U. is bluffing. Reality bites.

#136 Faron on 05.16.22 at 12:13 pm

Wow, that Twitter “arbitrage” is gettin’ real sweet. It’s almost as if the market was discounting the reliability of the Tesl CEO. If you bought at the top ’cause free money you are now staring at a paper loss of almost 30%. Thanks [t]E[f]lon, [f]Elon, Elon. Golden Age of Fraud.

#137 Sail Away on 05.16.22 at 12:18 pm

#131 Faron on 05.16.22 at 11:22 am

I remain extremely curious why you are down the rabbit hole on this right now.

——–

When I stand up and walk to the bathroom, my dogs are extremely curious as to what will transpire. Also when I go outside, pick something up, sit down, drink a cup of coffee or clear my throat.

I think the appropriate term is ‘rabid obsession’. It’s fine with my canine dogs, but for you I’d suggest electroshock or full frontal lobotomy.

Please respond with multiple comments using as many words as possible.

#138 Steven Rowlandson on 05.16.22 at 12:55 pm

Just make it against the law to have real
estate prices higher than a dollar and fix the penalty at 25 years hard labor. If that doesn’t deter the genocidally greedy then they really do deserve the penalty.

#139 Faron on 05.16.22 at 12:58 pm

#137 Sail Away on 05.16.22 at 12:18 pm

When a GOP supporting wack-job (Do you see how, having yourself resorted to disrespect, I am replying in the same vein?) who toes the line WRT Rupert Murdock anointed talking points with great accuracy and precision suddenly digs up old political dirt at exactly the same time an egregious far-right gun-fuelled hate-crime is committed, I become curious.

Interesting too that, as usual, you abandoned a losing argument and resort to disrespectful ad hominem attacks. If you didn’t want a thorough debate, maybe you shouldn’t have posted an easily dissected claim?

#140 Sail Away on 05.16.22 at 1:03 pm

#136 Faron on 05.16.22 at 12:13 pm

Wow, that Twitter “arbitrage” is gettin’ real sweet. It’s almost as if the market was discounting the reliability of the Tesl CEO. If you bought at the top ’cause free money you are now staring at a paper loss of almost 30%. Thanks [t]E[f]lon, [f]Elon, Elon. Golden Age of Fraud.

———

Heh, so good. 42% benefit if it closes at 54. If it doesn’t close, Twit gets $1B. If another interested party steps in, intrigue will expand.

In turmoil lies opportunity. Loving it.

#141 Faron on 05.16.22 at 1:09 pm

***Trigger Warning***

Wow, FX/NYT documentary about how Tesla autopilot has killed people. Premiering May 20th. Elon Musk’s Crash Course

#142 Faron on 05.16.22 at 1:17 pm

#137 Sail Away on 05.16.22 at 12:18 pm

full frontal lobotomy

Oooh, missed that. Most respectful.

Well, might make this a fair fight at least… ba dum, tsssh.

#143 Russ on 05.16.22 at 1:25 pm

Hi Garth,

I really enjoyed Doug’s analysis posted a few days ago, titled “The hinge”.

Might we persuade him to do a technical analysis of the Sail Away & Faron calls?

Aptly titled “The unhinged”?

Asking for a friend…

Cheers, R

#144 earthboundmisfit on 05.16.22 at 1:28 pm

What is the ‘Laurentian elite’?

Canadian “upper classes” from the corporate, academic and political /civil service walks of life, residing in the triangle between Ottawa, Montreal and Toronto.

#145 Sail Away on 05.16.22 at 1:31 pm

Look at uncle Warren buying hand over fist in this dip. He buys stocks, we buy Berkshire. And stocks.

https://www.wsj.com/articles/warren-buffett-spends-big-as-stock-market-sells-off-11652589031?mod=djem10point

#146 Ponzius Pilatus on 05.16.22 at 1:38 pm

Just found out “Toronto’s Airport” is in Mississauga.
They want you to be there 2 1/2 hours before departure.
Add another 2 hours to get there by car.
Never again.

#147 Shawn on 05.16.22 at 1:45 pm

Larential Elites?

#144 earthboundmisfit on 05.16.22 at 1:28 pm
What is the ‘Laurentian elite’?

Canadian “upper classes” from the corporate, academic and political /civil service walks of life, residing in the triangle between Ottawa, Montreal and Toronto.

*******************************
In other words its successful people that others like to be jealous of.

Who is that ate your homework and or your lunch? Trudeau, the CBC, the Bank of Canada or the Laurentian Elites? All of these? If not for them think how much richer the complainers obsessed with these would be.

#148 Shawn on 05.16.22 at 1:48 pm

Airlines and Airports

#146 Ponzius Pilatus on 05.16.22 at 1:38 pm
Just found out “Toronto’s Airport” is in Mississauga.
They want you to be there 2 1/2 hours before departure.
Add another 2 hours to get there by car.
Never again.

I feel sorry for Airlines as they have to operate in monopoly Airports that make the experience awful in many cases. But they also impose lots of rules on their own. A horrible business. Passengers say they want better but then mostly buy the cheapest tickets no matter how cramped the plane.

#149 Sonny Kang on 05.16.22 at 1:51 pm

Garth….any insight on what our inflation numbers might look like in Wednesday’s update?

#150 Faron on 05.16.22 at 1:54 pm

#143 Russ on 05.16.22 at 1:25 pm

Might we persuade him to do a technical analysis of the Sail Away & Faron calls?

Good one. LOL.

For the record though, I stopped making calls or recommendations partly from feedback from Sail Away who, ironically, has started making recommendations.

The only indication I’ve given of late is XHB as a housing short. That has worked well although I don’t have such a position. If you pressed me to make a prediction, I would say that it has a ways down to go, but the ride will be very bumpy. Putting a fairly natural growth line on the ETF (that runs through the mid ’08/’09 plunge through pre-COVID levels gives a very, very crude fair value of about $50. Currently trading at $61.

DO NOT DO THIS.

#151 T Rex and the dinosaur clique on 05.16.22 at 2:02 pm

-“Comments like this help weaken and divide our nation. Was that your intent? – Garth”

Folks that point out that the Federal Liberals are either intentionally, or through gross and really indefensible misunderstanding and miscalculation, breaking up the country, are told that they are “weakening and dividing our nation”.

What is happening out in Alberta right now is a reckoning as to whether or not the people out there have any future as part of this country, or whether they would be better off on their own.

Trudeau has done this. So did his father. Neither seems to have understood what they were doing or, if they did, neither cared or cares.

There are two likely outcomes in the next ten years:

1. We get a Federal government that respects the western provinces, particularly Saskatchewan, Manitoba, Alberta

or

2. We have an attempt by the western provinces to leave the federation.

There is simply no way the west is going to be able to function under the current system. They are being attacked. The latest thing is an attempt to shut down farming activities because fertilizer creates too much carbon dioxide.

Meanwhile the Libs are approving CO2 intensive industries in Quebec and the Maritimes. They have two different metrics that they use depending on where the industry is located. The unfairness is just palpable.

And they want “equalization payments” with most of the money going to Quebec.

They are driving the West out of Canada. And Trudeau and co. are too busy virtue signalling to the W.E.F. to even notice that they are doing it.

“The West” will never leave. It cannot. Work within the system instead of electing former Reform Party people who helped establish a forever Liberal dynasty in Ottawa. – Garth

#152 James on 05.16.22 at 2:05 pm

#141 Faron on 05.16.22 at 1:09 pm

***Trigger Warning***

Wow, FX/NYT documentary about how Tesla autopilot has killed people. Premiering May 20th. Elon Musk’s Crash Course

—————————-

Sounds like a bit of fear-mongering.

As much as I might dislike Musk, the anti self-driving movement preys upon human emotional stupidity in obvious ways.

As a utilitarian, numbers-oriented guy, no matter how much we valorize ourselves, humans, collectively, are incredibly stupid and reckless when driving vehicles. (Are you reading this on your ‘smart’ phone while driving, LOL!?)

Even if autopilot vehicles kill a few dozen, hundred or even thousands of people per year, they will save many millions more from death or injury simply by not being stupid, distracted, selfish humans.

Most of us are as safe at driving as TNLTB is good with investing.

Nothing to fear. The numbers will tell the story. 90 Americans die daily on the roads, and 2 million are severely injured yearly. AVs will cut that number to a very small fraction, even though they are never perfect themselves.

There are much better reasons to attack Musk.

#153 The Totally Unbiased, Highly Intelligent, Rational Observer on 05.16.22 at 2:24 pm

“It’s happening again in Ontario ahead of the June 2nd vote.” — Garth

Those lucky, lucky, lucky voters in Ontario get a chance to vote for the Ontario Party, which is currently led by the True Blue Conservative Derek Sloan.

It will be very, very, very interesting to see what percentage of Ontario voters jump at this incredible opportunity to try to save themselves and their province.

Nobody. Sloan is a nutbar. – Garth

#154 Sail Away on 05.16.22 at 2:35 pm

#143 Russ on 05.16.22 at 1:25 pm

Hi Garth,

I really enjoyed Doug’s analysis posted a few days ago, titled “The hinge”.

Might we persuade him to do a technical analysis of the Sail Away & Faron calls?

Aptly titled “The unhinged”?

——–

Haha, not bad. And on that note…

@F:

It’s over bro. All done, no more. The paperwork’s been filed, assets divided, kids are in the orphanage.

There’s nowhere left to go. Just walk away. Curb the compulsion. Don’t feed the coke-monkey.

#155 The Totally Unbiased, Highly Intelligent, Rational Observer on 05.16.22 at 3:15 pm

“Nobody. Sloan is a nutbar.” – Garth

So nobody will vote for Derek Sloan?

So nobody will vote for the Ontario Party?

Are you sure about that? Do you really think that the province of Ontario is that far gone? Do you really think that there is no more hope for the province of Ontario at this point?

I suppose you could be right about that.

Not a single seat. – Garth

#156 Matt on 05.16.22 at 6:29 pm

Thanks to all that replied to me (Shawn, PeterfromCalgary, etc.) about housing in CPI. I get that rental prices are already included, and yes a house is a long-term purchase. There’s a certain pure “economics as science” argument to be made there, I guess.

My no doubt over-simplified take, however, is that CPI is how we measure inflation, and inflation is what governs interest rate policy, which sets the cost of borrowing. Given that a mortgage is by far the largest amount of money that most Canadians will ever borrow, it seems ludicrous to exclude it from the feedback loop that informs future policy.

It seems clear at this point that interest rates have a first-order impact on housing prices, and that housing prices are of great concern to the public (and by extension, maybe even politicians). If this is true, what is the argument to *not* use house prices as an input to interest rate policy?

Is there some relevant period in the past where changes in house prices were not coupled directly to the interest rate? Genuinely curious.

#157 Hindsight on 05.16.22 at 7:04 pm

DELETED