Mistakes

For a dozen years Tim worked for an outfit with a DB pension plan. Lucky guy. But that’s over now. He was smart enough to hand in his notice just before the big run-up in interest rates began, because the lower rates are the more plans pay. Well, here are his options:

(a) If I wait until age 65 (15 years from now) to collect, it’s $20,000 a year. There’s no inflation protection until then. (b) I can wait five years and start collecting 50% of that value when I turn 55; I could invest that $10k/year in my RRSP, and use the proceeds to offset the reduction from what I would otherwise have collected if I’d waited until 65. (c) Or, I can take the commuted value of $244,000. Between my LIRA limit and some RRSP headroom I’ve been saving for just this eventuality, I can shelter the whole amount.

No brainer, of course. Given the fact inflation has returned (and will be here a long time) twenty grand a year in a decade-and-a-half could be a paltry sum. Ditto for half that in five years, especially with Canadian marginal tax rates set to rise. (Yes, it will happen as higher bond yields add at least $10 billion a year to Ottawa’s debt-servicing bill.)

Commuting and sheltering $244,000 for 15 years should result in a nestegg of just under $600,000 (assuming growth of 6% annually), and generate extra retirement income of three grand a month. That’s certainly better than taxable income of $1,600 monthly if Tim stays in the plan.

What could go wrong?

Lots, of course. The greatest danger is that T screws thing up. (However, being a blog dog he has natural immunity.) Sticking the wad into a bag of [email protected] mutual funds would be a mistake, watching 2-3% management expense ratios cannibalize returns. Not having a balanced approach, in a time when monetary policy is changing profoundly, would be dumb. And trying to pick some hot stocks or other meme assets just opens the guy to long-term risk and loss.

On that note, let’s take a minute to understand how everything is changing in this post-pandemic world. Seriously. Since Friday. More intense.

First, we now know interest rates will not pivot or even pause. More hikes lie ahead with the soonest date for relief being 2024. But mortgages are not going back to 2%. Not in your lifetime.

So, second, real estate – the most leveraged of assets and the opiate of the masses – is in the crosshairs. The greatest declines will be where we saw the biggest Covid gains. The adjustment will be greater than I expected a few months ago. And I am reminded of what happened in parts of Arizona and Florida during the 2005-8 American housing collapse. Some zip codes went through a 70% drop in residential values. Could you weather that?

Third, unemployment will rise. Layoffs will occur. This is the ‘pain’ Fed boss Powell talked about Friday in Wyoming. Central banks are about to cause this, and deliberately so as they fight inflation with higher rates, less stimulus and a deliberately impacted economy. Wages gains will be reduced, workers will have less leverage and employers will gain a stronger hand. So, fourth, you can start writing the obits of quiet quitting, remote-work and the so-called great resignation. What Covid wrought, normality shall erase.

Therefore, fifth, the investment world has changed. Choosing meme stocks or virus-fuelled assets has turned out to be a disaster. Peloton shares are down 90%. Wayfair and Shopify have been creamed. Zoom revenues have collapsed 70% and its stock is 86% off the pandemic peak. Netflix shares are lower by two-thirds as the streaming wars end and subscribers doff their PJs and go back to work. Meanwhile Bitcoin and its little crypto buddies have been zapped. From over $60k a coin in 2021 to $20k today. Yikes.

In short, there are many fine ways to lose money these days, Tim. We seem to be at a crossroads of employment, finances, risk, housing and public policy. Choose the option to commute your pension, but then pick the assets it holds carefully, wisely. You won’t have a happy retirement if you dump the funds into a GIC, nor a serene one if you pick four stocks. The goals are capital preservation yet regular growth and income, while keeping volatility and risk under control. It ain’t easy. Unless you go B&D.

Let’s review the correct portfolio weightings. Later this week.

About the picture: “And now ( Cue drum roll …) Introducing my 2 yr old Australian Shepherd, Vader,” writes Leigh. “Chock full of energy ( more like Piss and Vinegar some days) Vader excels at having fun , chewing on sticks , chasing squirrels ( Squirrels 28, Vader 0)  and trying to herd my son’s cats into some imaginary corral. As the sun sets on Georgian Bay he does his best to strike the right pose and get that far away Che Guevara look in his eye . Cheers and thanks Garth for all that you do .

Have a beast to share with the pack? Send me a picture and words ([email protected]). – Garth

133 comments ↓

#1 Daveyboy on 08.29.22 at 3:03 pm

Homes are starting to go south in Phoenix again. The home I rented in Gilbert Arizona has dropped by 4 percent in 30 days according to zillow. Ran into a realtor yesterday, more than 25 percent of homes in Gilbert that are up for sale, were purchased just back in February. Yikes!

Oh well, not my problem, the pool is calling, time to take the kids for a swim.

#2 PeterfromCalgary on 08.29.22 at 3:04 pm

I hope Central Banks don’t wimp out too soon. The longer this inflation persists that harder it will be to extinguish.

What we have now is a small kitchen fire so grab the fire extinguisher (higher interest rates) and put it out before it spreads and burns down the entire house.

#3 SunShowers on 08.29.22 at 3:10 pm

Gotta make sure those dang serfs lose their job and get thrown into the poor house, otherwise us rich folk might make a little less money.

#4 J on 08.29.22 at 3:12 pm

House prices crashing everywhere and mass layoffs and corporate bankruptcies haven’t even started yet. Gonna be a bloodbath when people start losing their jobs and realize they have no income, a million dollar mortgage, and their parents have no more money to lend them.

#5 Dr V on 08.29.22 at 3:35 pm

Hmm, a quarter mil and 15 years……no brainer, B&D .

#6 Damifino on 08.29.22 at 3:42 pm

…you can start writing the obits of quiet quitting, remote-work and the so-called great resignation.
————————–

Wow! Them’s fightin’ words.

#7 Felix on 08.29.22 at 3:45 pm

Mistakes.

i.e. owning dogs

#8 "NUTS!" on 08.29.22 at 3:47 pm

If indeed this correction in the housing market amounts to nothing more than clawing back ‘some’ of the gains made during Covid then it really is an insignificant event. Yes, some big losses, but in terms of an accurate reset of real estate evaluations it won’t even come close. Evaluations were extreme pre-Covid. I don’t see a true reset taking place.

#9 Søren Angst on 08.29.22 at 3:50 pm

‘Atta lay it on the line again today Garth as to what is coming. And it isn’t going away for years to come.

Kids think it will, the poor misbegotten, immediate gratification, earn a Gold Medal for breathing in and out, air…things that they are.

———————–

B&D true + Ryan’s Value ETFs (and not Growth) the ticket.

I have to say Garth I’d add OIL (per Doug local oil Oracle) w/High Dividends to the mix as oil seems to keep on chugging along on no matter what everyone says to the contrary, forecasts, etc.

All my oil stuff minimum +17% YTD total return and with dividend yields ranging from 9% to 37%.

—————

And the Cdn Big 5 Banks, despite a couple of them reporting OK results this past week, are still paralleling the X-Axis at a LESS THAN COMFORTABLE -8/-18% YTD Return:

https://www.google.com/finance/quote/BNS:TSE?comparison=TSE%3ATD%2CTSE%3ACM%2CTSE%3ARY%2CTSE%3ABMO&window=YTD

Oddly, the Bank investing Commenters typically swooning over their gargantuan (to them) 4 to 5% dividend yields have been VERY QUIET for quite some time now.

Probably figured they would be “safe” owning Cdn Bank stocks.

Imagine that?

#10 When the Whip Comes Down on 08.29.22 at 3:54 pm

DIdnt Ryan L indicate that markets were pricing in a 25bps cut summer 2023 on his blog post on Saturday?

#11 UFC on 08.29.22 at 3:55 pm

#105 GB on 08.29.22 at 7:59 am

Quick question. I need to replace an old deck. Will the cost of materials be less….more….or no change this time next year?

#109 Stereo Review on 08.29.22 at 8:26 am

#105 GB

Don’t wait.

There are plenty of decks on eBay.

I suggest Technics or Sony. You may need to change the belts, but once you do, you can listen to your Led Zeppelin tapes for the next 20 years.

#113 Sail Away on 08.29.22 at 9:41 am
@105

Replacing old pitch decks takes time and inspiration, so move ahead whenever feels right. Try to tailor the new deck to your investor/audience’s needs and the situation at hand.

Good luck. Going hat in hand for funding is no fun.

You may feel like you need to deck someone, but don’t.

Take a breath. Walk away.

We can’t do anything about these politicians or inflation outside of not voting, not doing what they say, not buying stuff.

If you deck’em, there are likely to be consequences.

Keep your personal standards on the upper deck.

#12 Caffeine Monkey on 08.29.22 at 3:59 pm

Do mutual funds really have a 3% expense ratio?? That’s bananas. Most of my ETFs are 0.05%.

Equity mutual funds can range that high. – Garth

#13 espressobob on 08.29.22 at 4:06 pm

Something never discussed is how to invest the cash position in ones portfolio. Money market funds over the past number of years are pointless. Today at least a 2% rate and liquid when it comes to an ETF.

Beats the hell of a locked in GIC.

#14 Søren Angst on 08.29.22 at 4:16 pm

Sorry Garth, but I can’t resist.

Newsflash from MSM and “Climatologists” and their Spawn:

Unprecedented heat spells, dry river beds, we’ll all be roasted alive and killed…and, and then there are all the torrential once in a millennia downpours inundating most of N. America, sweeping away all in their path.

MEANWHILE at StatCan:

“Model-based principal field crop estimates, July 2022”
https://www150.statcan.gc.ca/n1/daily-quotidien/220829/dq220829a-eng.htm?HPA=1

“Increased production was largely driven by higher yields because of better growing conditions in Western Canada…

Canadian farmers are projected to produce more wheat, canola, barley, oats, soybeans and corn for grain, according to recent yield model estimates using satellite imagery and agroclimatic data”

————-

Could the SUPPOSED debilitating heat and torrential, flooding rain have had something to do with that?

I ‘dunno. You tell me?

And the poor Farmer’s that should have been ZAPPED dead from heat stroke or swept away and drowned seem to have made it thru in one piece after all.

Imagine that?

#15 Prince Polo on 08.29.22 at 4:17 pm

An extra pat on the head for the blog doggies that were vociferously mocked for suggesting a 50+% drop on riDONKly-priced real estate. Today is your treat.

#16 Bezengy on 08.29.22 at 4:27 pm

I left my employer a few years back after 5 years service with 100k in a DC pension. You could contribute bonuses and benefits which is why is was so much, that and great returns. I was always saddened by older employees I spoke with that had over 30 years of service and a pension worth around 400k. They liked GIC’s. They’re guaranteed don’t ya know.

#17 Linda on 08.29.22 at 4:42 pm

Anyone else notice how many of the dog photos are on the water/on the beach? The joys of being a pup:)

So I’m wondering, there are a lot of unfilled positions out there. Could there be ‘enough’ of them to shelter most if not all those who are currently employed from being handed a pink slip? One million plus vacant positions is quite a nice cushion. Just saying. I must add, the fact that higher interest rates will cause ’employees will have less leverage and employers will gain a stronger hand’ directly plays into the conspiracy theorists who believe government is all about keeping ‘the people’ under the thumb of ‘the elite’. While I don’t believe there is an organized conspiracy to do just that – have to say I can’t argue that a lot of policy does seem to center around keeping the status quo ‘as is’. No real surprise, given that those in power are usually less than enthused about relinquishing it.

#18 Yukon Elvis on 08.29.22 at 4:43 pm

#9 Søren Angst on 08.29.22 at 3:50 pm

And the Cdn Big 5 Banks, despite a couple of them reporting OK results this past week, are still paralleling the X-Axis at a LESS THAN COMFORTABLE -8/-18% YTD Return:

https://www.google.com/finance/quote/BNS:TSE?comparison=TSE%3ATD%2CTSE%3ACM%2CTSE%3ARY%2CTSE%3ABMO&window=YTD

Oddly, the Bank investing Commenters typically swooning over their gargantuan (to them) 4 to 5% dividend yields have been VERY QUIET for quite some time now.

Probably figured they would be “safe” owning Cdn Bank stocks.

Imagine that?
++++++++++++++++++++++
Overweight on those and not swooning at all here. Ready to buy more in Nov. for my self imposed mandatory quarterly buy. I measure in decades not yoy.

#19 Søren Angst on 08.29.22 at 4:49 pm

#12 Caffeine Monkey

Most of my ETFs are 0.05%.

——————

I got off that low MER bandwagon awhile ago. Those low MER ETFs performed poorly for me.

Some of my ETF/ETN MER’s, Dividend Yields, YTD Total Return, in %:

0.85 /37 /+17
0.72 /8.3 /+31
0.58 /17.5/+0.4 excl. div yield

For example, quintessential low MER Cdn ETFs (MER, Dividend Yield, YTD Total Return) in %:

IVV 0.03/1.44/-11
SPY 0.09/1.46/-11
VOO 0.03/1.49/-11

You get what you pay for. I pay 9-28X the MER but the results speak for themselves.

Even my high MER ETF/ETNs are bargain compared to Mutual Fund MERs (and outperform them as well).

#20 NOSTRADAMUS on 08.29.22 at 4:51 pm

THE GRIEF PROCESS-CONTINUATION.
As I type, Real estate prices continue on their spiral downward, even though transaction volume and supply is relatively low. The diamond tipped bullet between the eyes occurs when one or two transactions in a given area bring everybody’s market price down together. Smart seller’s are capturing fleeting gains while they exist, beating the slow moving sellers with cement on their feet to market. The selling window will not last long because the word is out, prices are in freefall. Hmmm- The grief process, and how it relates to declining real estate values from a sellers perspective . “Not in my city.” “Not in my neighborhood.” “Not on my street.” “Not on my house.” Read my lips, Real estate values only go up, my realtor has told me this for years, I believe him, why would he lie? Moving along, as the grief process picks up speed, Denial (as indicated above) Bargaining (look at all my extras and upgrades). Followed by Anger and finally, bitter Acceptance (my realtor ——- , you fill in the blanks.) Once again the voice of reason.

#21 jess on 08.29.22 at 5:00 pm

loss of money along goes trust

FBI says fraud on LinkedIn a ‘significant threat’ to platform and …
https://www.cnbc.com › 2022/06/17 › fbi-says-fraud-o…
Jun 17, 2022 — The scammer starts with small talk over LinkedIn messaging, and eventually offers to help the victim make money through a crypto investment

#22 Reality Check on 08.29.22 at 5:01 pm

14 Soren Angst

Increased production was largely driven by higher yields because of better growing conditions in Western Canada…
—————-

The dirty little secret of changing climates is that there are winners and losers.

The Canadian prairies have been big winners over the last 40 years. More moisture throughout the year. Temps that rarely make it to the high 30s, low 40s which was common in the 1960s-70s.

These climate improvements couple with new farming practices/technologies mean good years have great crops and bad years still have OK crops.

But you won’t hear about this in the CBC.

#23 IG-wealth-managers on 08.29.22 at 5:04 pm

Here at IG Wealth Management, we changed our name a few years ago from Investors Group. You know, the Winnipeg-based group of Mutual Fund peddlers.

We changed our name because we had a bad reputation from having > 2.5% MERs on many of our mutual funds. And don’t forget the deferred sales charges that keep you locked into our middling funds if you try to hit the exits!

Guys like Garth: teaching people about what to look for in a ‘fee-for-service’ advisor, DIY, etc… Sheesh! I miss the days of having a new car every 2 years thanks to our high fees and punitive DSCs…

#24 Popeye The Sailor Man on 08.29.22 at 5:12 pm

Public Service Pension;
When you take the transfer value and commute it you forgo the PSHCP as a retired member.
Normally when taking the pension you pay half and they pay half of the PSHCP.
Is there a Health Care Plan in Canada with same coverage that can be bought for a reasonable fee if you take the transfer value?

Asking for a friend. ;-)

That plan’s benefits are grossly overstated and actually quite expensive. I know. There are better private-sector alternatives. – Garth

#25 Søren Angst on 08.29.22 at 5:20 pm

#22 Reality Check

I mean, you know…you look at this DEATH AND DAMNATION Environment Canada temperature map forecast, Aug-Oct:

https://weather.gc.ca/saisons/image_e.html?img=s123pfe1t_cal_comb

you conclude:

1. Everything will dry up, including the people.

2. Eastern and Central Canada will be reduced to cracked dry river mud beds with fauna skeletons embedded for future Archaeologists to find, dig up and ascertain the disaster that happened (except for the Immortal One).

And

3. SOMEBODY should start growing GRAPES in the middle of Hudson Bay…South end of Coats Island looks good to me.

#26 rikk on 08.29.22 at 5:30 pm

To #24 … I signed into the plan in 2019 for the travel coverage … e.g. frequent trips to US, other planned vacations … brilliant timing.

#27 Søren Angst on 08.29.22 at 5:30 pm

#18 Yukon Elvis

Unlike you, Paleo me does not have decades left.

And if it is true current high rates, high inflation will persist as they did in the 80s into the 90s…well guess what:

You’re gonna get you decades old wish ‘cept in reverse.

#28 Bguy1 on 08.29.22 at 5:31 pm

That plan’s benefits are grossly overstated and actually quite expensive. I know. There are better private-sector alternatives. – Garth

Better than this if implemented: https://pipsc.ca/labour-relations/pension-benefits/major-updates-to-public-service-health-care-plan ?

#29 CL on 08.29.22 at 5:38 pm

As I have said, there will be no soft landing. It was ridiculous for them to even say that when inflation was over 8%.

As a reminder too though, while they are saying rates will remain high until 2024, didn’t these same people say rates would stay low until at least end of 2023 when the pandemic hit? didn’t people take those comments “to the bank” when they blew their brains out on debt/real estate? didn’t those comments drive real estate?

credibility problem?

#30 jess on 08.29.22 at 5:45 pm

bank of dad?
llinois doctor with tax evasion, filing false tax returns and assisting in the preparation and filing of false tax returns for his children.

According to the indictment, from 2011 through 2017 Krishnaswami Sriram, of Lake Forest, Illinois, attempted to evade payment of approximately $1.6 million in taxes, penalties and interest he owed to the IRS. Among other evasive acts, Sriram allegedly caused his children to be the nominal owners of two rental properties he owned and operated, while still continuing to receive income from those properties. He also allegedly transferred more than $600,000 from his U.S. bank accounts into bank accounts in India that he controlled.

Sriram allegedly filed false individual income tax returns that did not report his income from the rental properties and did not disclose his ownership interest in the foreign accounts. He also allegedly filed tax returns for his children that falsely reported the income and expenses related to the rental properties. As part of an attempted offer in compromise, Sriram allegedly knowingly submitted false documents to the IRS that omitted some of his assets, including an investment account in the United States, investment and bank accounts in India and multiple rental properties.

https://www.justice.gov/opa/pr/illinois-doctor-indicted-tax-crimes

#31 Nonplused on 08.29.22 at 5:46 pm

Today Nonplused has decided to weigh in on the topic of:

Quiet Quitting

On reflection, I have reflected that when one reflects, the quiet quitters have always been among us. They are not new. They have always existed in large corporations, and in overwhelming numbers in unions and public “servant” roles. The only thing that has changed is that the “quiet quitters” used to be “quiet”. They didn’t want to draw attention to themselves and possibly spoil the gig.

So what happened? Nothing really. Media is what happened. Blame Twitter. Some so-called journalist somewhere had to write something about something and not much was going on. So this so-called journalist “manufactured” a story, news if you will, where before there was none. As is the case with the majority of the news these days, the story was manufactured clean out of thin air. But there are a lot of webpages to fill and TV hours to waste, so they have to run with something. Especially now that people have kind of gotten bored waiting for Putin to lose or Germany to freeze. Zzzzz. Not even Mar-A-Lago could capture much attention once it became clear the issue was “documents”. Documents???? Are you freaking kidding me? Oh the walls are really closing in now! Again.

So as I reflected, I recalled a speech given to me by Bob early in my career. No quotes necessary, that was actually his name. “Nonplused”, he said,, “Don’t be one of those folks hanging out in the coffee room complaining all the time and bitching about what they are getting paid. If you don’t like this job or think you are worth more money, get another job. If you don’t have a job offer in hand that pays more, you are really just blowing smoke and you are only fooling yourself.”

“In fact”, Bob continued, “you should interview twice a year. Not apply for 2 jobs a year, but apply for enough jobs that you interview twice a year. That’s the only way to know your worth. That’s the only way to know what’s out there. As an added benefit, if something great comes up, you won’t miss it.”

I left that job for what turned out to be the best opportunity I’ve had in my career so far about a year and a half later. It changed everything.

Bob left about a year after that. I wonder what happened to him. I think somebody said he was retired now, living on a lake somewhere.

#32 Reality is stark on 08.29.22 at 5:48 pm

There is real trouble in China, this is deflationary.
The Fed will pivot.
Their fight right now will prove to be unnecessary.
When politicians spend other people’s money with drunken abandon they make everyone poorer.
Except themselves of course.
They have no incentive to control costs so they don’t.

#33 Mad Money on 08.29.22 at 5:48 pm

TD just came out and said Canadian housing is going to drop 25% in price.

This is coming from the big bank who is in the business of writing mortgages. So, double that amount and a 50% price drop is probably pretty accurate over the next year.

#34 West New West on 08.29.22 at 5:59 pm

That’s one beautiful picture and one handsome dog. How you got him to still long enough to snap a shot like that is a mystery

#35 Faron on 08.29.22 at 5:59 pm

#25 Søren Angst on 08.29.22 at 5:20 pm
#22 Reality Check

OMG, I’m tittering heartily at you RN Mr “archeologists have seen no magma chambers”. It’s like watching a bunch of toddlers playing around with mining equipment meant for trained adults. Kinda cute and hilarious until SQUISH. LOL. Guessing that’s how Garth feels when he watches steerage talk about stonks and investing.

#36 DOWn on 08.29.22 at 6:07 pm

What happens if the lock downs reappear in the fall via the recent uptick in monkey pox, bird flu cases?

Wouldn’t people once again want to get out of the city’s and go rural or to less congested areas, once again fueling RE markets?

#37 Hindsight on 08.29.22 at 6:07 pm

You see Garth, when you start to open your eyes then you can see it will be different this time…eyes wide open, keepem wide open Garth !

#38 Chaddywack on 08.29.22 at 6:15 pm

I wonder if Trudeau will raise all tax rates or only the top bracket again.

Seems to be a pattern with him to only raise the top one.

#39 Flop… on 08.29.22 at 6:28 pm

#1 Daveyboy on 08.29.22 at 3:03 pm
“Homes are starting to go south in Phoenix again. The home I rented in Gilbert Arizona has dropped by 4 percent in 30 days according to zillow. Ran into a realtor yesterday, more than 25 percent of homes in Gilbert that are up for sale, were purchased just back in February. Yikes!
Oh well, not my problem, the pool is calling, time to take the kids for a swim.”

///////////////////:////////////////

I’m coming down for a look to see what’s going on at Xmas time.

Normally stay at the Hyatt Downtown, and then check out a couple of bedroom communities each time.

With inflation ripping, think I’ll stay in Tempe this time, and check out Gilbert or Chandler.

Some of the suburbs down there I find it hard to be age appropriate.

Tempe is full of 20 year olds, and Scottsdale is full of 60 year olds.

I guess another way of looking at it is in Tempe I feel like a dirty old man.

In Scottsdale I feel like I’m being watched by a dirty old man…

M48BC

#40 Ed on 08.29.22 at 6:43 pm

Just a quarter mill…best to put it in a tax advantaged 6 pack

RY
CP
TCP
BCE
CHP-UN
FTS

I’ve had my kids in this for years.

#41 Arctic Gringo: Qalunaaq on 08.29.22 at 6:46 pm

“…the opiate of the masses…”, Karl Marx may have coined the term, but Maynard James Keenan croons it best!

Never sold into a storm, until now. Fortunately, it was for good reason – very first(!) RESP withdrawal. Put the sell order in Thursday, kind of and sort of knowing what was to occur Friday.

It’s getting put to good use (not a liberal arts degree either) – thank dog.

#42 chalkie on 08.29.22 at 6:46 pm

When you are buying a home in any real estate market, it is a very personal decision. Homes represent the largest single purchase most people will ever make in their lifetime, it’s crucial to be in a solid financial position before diving in, borrowing personal money and hiding other financial obligations to prove to a mortgage lender that you have the required the down payment is not smart, at some point, all the chickens will come home to roost and you will be out of feed. If the banks won’t give you the full mortgage loan, it’s a good indicator that you are about to step into something that you cannot afford.
Always use a Mortgage Calculator to find out how much your monthly housing payments will be based on your down payment and interest rate, understand all the other incremental things that go hand in hand with home ownership. Anything less than 20% down payment, will also require you to take out Private Mortgage Insurance and its not cheap.
Trying to time the market or predict what might happen next year is not the best homebuying strategy. Instead, it’s better to buy your home based on job security and your budget needs. If you find a home you love in a neighborhood you love and it also fits your budget, then chances are it might be right for you. However, if you make too many sacrifices just to get a house, you may end up with buyer’s remorse and an expensive albatross you have to offload, it could be financial ruination for life. Both buyers and sellers are in unpredictable times for real estate decisions, setting on either side of the fence or waiting at the top for something to happen. Last year in Canada (2021), 667,000 homes changed hands, this story alone tells us, there is a lot of buyer remorse running around. As for the realtors who made plenty of dough in the past two years with only the luck of the draw, there were multiples or realtors who made little to zilch and have since packed in their get rich quick dreams. There is some hype on fall prices rising again, in my option this will be so short lived, it will be called a blink. The housing market basement as a few more steps to get to the bottom yet. Currently, we have surpassed the downward July 2021 prices and still counting lost dollars, if you’re making an offer, make it low, its your money and don’t let any realtor tell you what to offer, its in their best interest to keep prices high, there are plenty of deals to be found, as they say, “a fool and their money soon parts”.

#43 Steven Rowlandson on 08.29.22 at 6:51 pm

The first step in the right direction along the path to financial sanity. Hopefully not the only step.

https://www.bnnbloomberg.ca/td-sees-up-to-25-drop-in-canadian-home-prices-by-early-2023-1.1811945

#44 Miffed on 08.29.22 at 6:58 pm

I read the Article in the Globe on Horizon’s HISA ETF.
Pays just under 3% vs the banks just under 1%.
No brainer for short term parking of cash. Completed the ‘buy’ order but when my order went through, a ‘rejected’ message appeared in the buy column. The big, bully RBC bank stopped my order. They could stop any buy order on any stock if they wanted. What agency in Canada would monitor this abuse and do something? The bank(s) are getting away with this abusive practice and I don’t know how to stop them.
Thanks Garth for all you do.
Regards, Wayne Feeney

#45 Steven Rowlandson on 08.29.22 at 7:02 pm

‘I wonder if Trudeau will raise all tax rates or only the top bracket again.”

It isn’t so much taxes that need modification as much as it is spending that needs abatement. We really don’t need much government spending. Just the basics. Defense, Justice, Diplomacy, Transport, Communications, CRA/ Treasury, Royal Canadian Mint and BOC. Leave the rest to the provinces or the people.. No need to micro manage everything.

#46 That Guy on 08.29.22 at 7:17 pm

It’s now clear that the path to financial success relies on sticking to the old tried and true, widows and orphans stocks. Banks, utilities, etc. In the face of stock price drops, they keep paying the dividends. As a point of reasoning: when you own stocks you ally yourself with the multimillionaire CEOs and other folks with money. Plus you never have to field calls from non paying, demanding renters.

Bad idea. No balance means more volatility. There are better options with equal distributions. – Garth

#47 ElGatoNeroYVR on 08.29.22 at 7:22 pm

#31 Nonplused on 08.29.22 at 5:46 pm
“In fact”, Bob continued, “you should interview twice a year. Not apply for 2 jobs a year, but apply for enough jobs that you interview twice a year. That’s the only way to know your worth. That’s the only way to know what’s out there. As an added benefit, if something great comes up, you won’t miss it.”
====================
Words to live by.
I am not Bob however as a manager I used to give the same advice to my people in previous companies to HR’s dismay.
The look on the faces of some of these complainers was priceless .I can tell you that the vast majority did not appreciate my candid advice as they went to complain to HR and in those famous yearly employee surveys. A few did eventually leave ,maybe 2% ,most washed out eventually or learned to achieve the metrics.
I still give that advice everytime someone wants a lot more money than what the company defines as market.

#48 Ponzius Pilatus on 08.29.22 at 7:26 pm

#1 Daveyboy on 08.29.22 at 3:03 pm
Homes are starting to go south in Phoenix again. The home I rented in Gilbert Arizona has dropped by 4 percent in 30 days according to zillow. Ran into a realtor yesterday, more than 25 percent of homes in Gilbert that are up for sale, were purchased just back in February. Yikes!

Oh well, not my problem, the pool is calling, time to take the kids for a swim.
————————
Yep.
Almost 50 degrees.
Everything is drying out.
So lucky to live in the best place on earth.

#49 Dragonfly58 on 08.29.22 at 7:27 pm

There was an interesting comment made by Justin Trudeau during today’s broadcast where he states that Canadian children were taught in school that Canadian natives were inferior to non natives. How far back in history is he dredging this stuff up ? I started school in the early 1960’s and I can’t recall a single instance where this sort of thing was mentioned, let alone taught.
There were even a few Native students in my School. North Vancouver, some of the reserve children , plus other part native children that didn’t live on the reserve, attended the regular public school. I don’t recall any time they were treated any different than any other student except that the teachers seemed to give them more latitude regarding attendence. The teachers were on most of us like hawks for notes from parents after absences, and quite publicly in the classroom. It seemed the Natives were almost never called out for missing school. Perhaps it was dealt with more privately after school
I would like to see how far back you would have to go in history to find this sort of instruction regarding superior and inferior groups in a Canadian public school curriculum.

#50 Living On Cat Food on 08.29.22 at 7:28 pm

If Tim has a 15 year run before he needs his funds, why only assume 6%? Wouldn’t 7% or potentially 8% be realistic if he goes 60/40 or 70/30?

Be realistic. – Garth

#51 crowdedelevatorfartz on 08.29.22 at 7:40 pm

@#119 Political Ponzie
“Inside of you is a politician yearning to get out.”

+++
And then I wake up screaming…… “Nien! Nein!”

Totally off subject.
After the Romans, Mongols, Cossacks, Napoleon, Hitler, Russia, etc etc etc. have romper stompered through your country…..
Does Austria have a National “surrender flower” they toss at the victors?

#52 BMO ETF on 08.29.22 at 7:46 pm

Thanks for the blog Garth
Just noticed for BMO self administered plans 88 BMO ETFs have no commission fees!

Quick question are other self administered plans like RBC or TD offer commission free ETF for their own companies ETF?
Thanks

Why would you pay a commission to buy an ETF? – Garth

#53 the Jaguar on 08.29.22 at 7:57 pm

Vader” ( the lovely creamsicle dog), might be advised to channel Juan Almeida Bosque who yelled to Che and the other Cuban Revolutionarios ” Aqui no se rinde nadie!”, roughly translated as ‘No one surrenders here!” A solid piece of advice overall as one makes the journey through life and everything coming ahead..

GT sez ” We seem to be at a crossroads of employment, finances, risk, housing and public policy. ”

None of that was ever going to be an easy ‘climb out’ from the impact of easy money, unearned handouts, woke everywhere one looks, and a whole lot of peeps ( see ‘What Matters” blog post August 26 2022) who just don’t understand what it means to sit down to a banquet of consequences. They have been well warned. Don’t come cryin’ later.

Be encouraged . Hope springs eternal. Extreme student rental accomodation shortage in Cowtown due to warm bodies actually showing up to get educated and socially interact on campus. Parking lots, restaurants, and other venues are full downtown, so it seems not everybody is embracing WFH, etc.

Nobody even mentions the word ‘Covid’ in everyday conversation when there are so many other things to complain about. This is the great ‘cleansing’ that was always coming, and if you have prepared for the storm you will come out on the other side intact.

How the hell else do you think Shackleton and the others on the James Caird ever set sail and arrived on South Georgia? “Through endurance we conquer”.

Yeah, and a D&B is like an insurance policy to make sure you make landfall…..

#54 Sail Away on 08.29.22 at 8:05 pm

Wow, busy days. Teaching university summer course, tuning up dogs for bird season, running mountains, operating engineering firm… There’s barely time to look at the portfolio and see that all is well. Whew. Unlike climate Armageddon approaching the US southeast, things seem good on the Sail Away finance front.

#55 Marc Roger on 08.29.22 at 8:06 pm

Why aren’t there any news reports on the effect of interest rates on our national debt?

#56 Ponzius Pilatus on 08.29.22 at 8:07 pm

#51 crowdedelevatorfartz on 08.29.22 at 7:40 pm
@#119 Political Ponzie
“Inside of you is a politician yearning to get out.”

+++
And then I wake up screaming…… “Nien! Nein!”

Totally off subject.
After the Romans, Mongols, Cossacks, Napoleon, Hitler, Russia, etc etc etc. have romper stompered through your country…..
Does Austria have a National “surrender flower” they toss at the victors?
———-
Obviously you never heard of the Austrian/Hungarian Empire.
They even supplied an Emporer to Mexico.
That’s the problem when people don’t have more than grade 5 history, that ends with Churchill defeating the Wehrmacht.

#57 Ponzius Pilatus on 08.29.22 at 8:14 pm

#51 crowdedelevatorfartz on 08.29.22 at 7:40 pm
@#119 Political Ponzie
“Inside of you is a politician yearning to get out.”

+++
And then I wake up screaming…… “Nien! Nein!”
——————-
Nien?
You mean “nyet”?
so you failed Russian 101, too.

#58 toronto1 on 08.29.22 at 8:25 pm

interesting take — seems that everyone is turning more bearish on RE in the short term.

lets see how high the BOC hikes, anything over .50 and three will be be pandemonium in the “RE” streets, if they come out and do a .75 or 1,00 basis point hike anybody that brought this summer will be underwater by Christmas.

the consens from the reasonable crowd seems t be .50 ut im seeing some calls from some dudes that have been spot on the last few times for .75 and above.

the bigger threat that NOSTRADUMUS on here has nailed is the removal of liquidity and credit from the system, if banks see bigger drops upcomong they becoming conservative on their lending estimates etc. se;f fulfilling feedback loop.

For anyone in the market— just wait a while– no real reason to buy until the FED at least takes a breather for 6 months from any rate hike movement.

#59 Flop… on 08.29.22 at 8:38 pm

Flop Drops.

Time to put the motorcycle helmet back on and do another Flop Drop.

When I pointed out that a block of land in Chilliwack went for 500k, that doesn’t mean I think it’s a good price, I’m reporting on the correction in real time, the numbers are the numbers.

The possibility of one day being able to get a brand new house for under a million again should keep enough people on the treadmill.

Vancouver proper seems to have stalled out at about 1.39 million, you see the odd one go lower, but that’s where the logjam is at the moment, the next rate rise might be the Metamucil the market needs.

I walked by a home on the weekend that has been for sale for 3 months, with 3 price reductions and the owner said hello to me.

Still selling, I enquired.

No selling, waiting, for interest rates to go back down so the buyers can come up to his number, he replied.

O.k, good luck with that strategy.

Surrey,haven’t seen too many go below the million mark yet.

Someone just bought this home for 1.04 on the North Delta side of the border.

https://www.zealty.ca/mls-R2716465/11441-95-AVENUE-Delta-BC/

I looked to see how some of the historically lower areas, like Mission and Pitt Meadows are fairing.

Mission is down 29.1% yearly according to Zolo.

Pitt Meadows is down 27.8 yearly, and 40.8 percent quarterly.

Worse news for residents is that is still Pitt Meadows…

M48BC

#60 Tom on 08.29.22 at 8:49 pm

“Wages gains will be reduced, workers will have less leverage and employers will gain a stronger hand. So, fourth, you can start writing the obits of quiet quitting, remote-work and the so-called great resignation.”

Gee, employers will “finally” gain the stronger hand over employees. It is about time that they exploit employees “for once”. Package me out and I’ll gladly leave the workforce and the the boomers continue their love of work which it apparently the only thing that defines them. #Sad

What has any of that got to do with Boomers? You a bigot? – Garth

#61 crowdedelevatorfartz on 08.29.22 at 8:57 pm

@#56 &57 Ponzies Puns!

Verdammt Ponzie, ich hätte fast Lager aus meiner Nase geschnupft!
Sehr lustig!

#62 Walter Ulbricht's Sex Appeal on 08.29.22 at 8:59 pm

More condos. More clogged arteries. Ontario population could grow more than 6 million over the next 2 decades.

#63 Ronaldo on 08.29.22 at 9:34 pm

#59 Flop…

Someone just bought this home for 1.04 on the North Delta side of the border.

https://www.zealty.ca/mls-R2716465/11441-95-AVENUE-Delta-BC/
————————————————————-
Well, they didn’t do so bad at $131,600 under the July 2021 assessment but still $181,300 over the prev. 2020 assessment of $858,000. No sales history in the last 3 years so they are still laughing all the way to the bank.

It is people that are sitting on huge equity that have bought years ago that are having to sell and will take these large drops knowing that they still win the lottery. The people who suffered with FOMO are going to be very very sorry with what is yet to come.

#64 yvr_lurker on 08.29.22 at 9:38 pm

why Garth do you expect only an increase in the marginal rate? is it because this is the easiest mechanism to raise $$$ that does not affect the high end investor class, capital gains receiving group that T2 and his buddies belong to? Heaven forbid the idea of increasing taxes on capital gains or investment income. Keep that low. Up with the marginal rate on those who are in the 54% club receiving income from a demanding job, rather that those who sit at home on their computer passively collecting investment income

#65 crowdedelevatorfartz on 08.29.22 at 9:39 pm

Gee.
Will Britain’s Conservatives elect the second female Prime Minister?
Sept 5th.

Liz Truss looks like a shoo in for the PM position.
Massive inflation. Union strikes. Rising interest rates.
Seems like Maggie Thatcher’s reign all over again.
We won’t need the Falkland War to get her popularity up in the polls….when we have Russia.

#66 LeeBee on 08.29.22 at 10:02 pm

West New West on 08.29.22 at 5:59 pm

We had the remaiders of a T-Bone Steak dangling in the orbit just outisde of the range of our iPhone. Vader had Laser Lock for just a few seconds in which we were lucky enough to capture the shot.

#67 Sags On Rent on 08.29.22 at 10:02 pm

#32 Reality is stark

There is real trouble in China, this is deflationary.
The Fed will pivot.
Their fight right now will prove to be unnecessary.
When politicians spend other people’s money with drunken abandon they make everyone poorer.
Except themselves of course.
They have no incentive to control costs so they don’t.

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

YA MAN!

Nailed it.

There is only one incentive – buy our votes with our own money.

Just like Twitter Execs had no incentive to do away with the spam accounts. There was no bonus for that.

And just like politicians have somehow managed to ram through all the legislation to keep billions of dollars flowing with no accountability. Happens in US as per below, happens in all democracies.

We’ve been completely undermined by special interest and corporations that throw millions and billions and these politician’s marketing campaigns. I can only imagine the level of corruption and compromised integrity that exists today in the western countries.

https://www.theguardian.com/commentisfree/2022/aug/29/billions-in-dark-money-is-influencing-us-politics-we-need-disclosure-laws

What about German leader selling their own people out?

“Under Schröder – who went on to become one of Putin’s “useful idiots” – German industry began to abandon its postwar reliance on coal and nuclear energy in favour of Russian gas and renewables.

For decades, the Kremlin acted as Germany’s geopolitical drug-dealer, tempting Berlin to become ever more addicted to the energy that fuelled its manufacturing, pharmaceutical and chemical factories. Now that the Germans are about to go cold turkey, they are discovering how cynically the national interest was betrayed by their politicians and captains of industry.

With Schröder as its salesman, a new Nord Stream 2 pipeline was built under the Baltic Sea — with the blessing of Mrs Merkel, who fended off Anglo-American pressure to cancel what was regarded as a threat to European energy security.

Last year, as Russian tanks massed on the Ukrainian border and Nato warned of imminent invasion, Gazprom redoubled its efforts to keep the flagship project on track.
The Russian energy giant poured €192 million (£163m) into an environmental foundation set up by Manuela Schwesig, the Social Democratic premier of Mecklenburg-Vorpommern — the state that hosted Nord Stream 2 and stood to gain most. She proceeded to denounce the US for opposing the pipeline, claiming that American sanctions were purely self-interested.”

https://www.telegraph.co.uk/business/2022/08/28/how-decades-complacency-have-left-germany-facing-cold-dark-winter/

#68 LeeBee on 08.29.22 at 10:10 pm

the Jaguar on 08.29.22 at 7:57 pm

Nah -? Vader doesn’t give a shit beyond his next decent meal.

#69 Shawn on 08.29.22 at 10:26 pm

Commute pension versus collect in 15 years

In my experience the government DB pension plans are unfair to people who leave employment early and park their money within the plan. So this may indeed be a case where commuting is far better. The longer its parked the more unfair it is. Plan members and pension plan board members tend not to give a rip about people who leave way early before they can collect a pension.

It is almost shocking that just 6% a year causes money to grow 2.4 times larger in 15 years.

Similarly what costs a dollar today would cost $2.40 in 15 years with 6% inflation – which is why Central banks are hell bent on getting inflation back to 2% or so.

#70 BCWally on 08.29.22 at 10:30 pm

I’m kind of hoping someone on the blog (or you Garth) can explain the fact that the central bank holdings reflect an “indemnity” value as an asset.
Apparently as far as I can gather that’s what the Canadian government would owe the central bank if they had to sell the BOC bonds they piled on during the pandemic to fund all of the federal handouts.
It looks like the BOC insisted Ottawa would pay any losses on bond sales if they had to sell them later as part of the deal. Well, we all know bond prices fall when interest rates rise.
I guess we better hope the bank doesn’t sell them, because the indemnity is already 31 billion and rising with every yield increase. It was 35 billion before the July market rally where bond yields were going down.
That isn’t happening anymore. Yields are rising steadily.
My question is do we have to pay this? I don’t think so because the bonds just matured and rolled off without being sold. But then I don’t have all the details of the deal.
Like, this is only gone $54 billion down out of $435 billion. I wonder what that indemnity will be as time goes on and yields go higher.
Tax increases if we do have to pay it?

#71 Shawn on 08.29.22 at 10:41 pm

Protect the Investor Class!

#64 yvr_lurker on 08.29.22 at 9:38 pm
why Garth do you expect only an increase in the marginal rate? is it because this is the easiest mechanism to raise $$$ that does not affect the high end investor class, capital gains receiving group that T2 and his buddies belong to? Heaven forbid the idea of increasing taxes on capital gains or investment income. Keep that low. Up with the marginal rate on those who are in the 54% club receiving income from a demanding job, rather that those who sit at home on their computer passively collecting investment income

****************************
Hear, hear. You are right. Gotta protect us Rentiers.

#72 Ponzius Pilatus on 08.29.22 at 10:45 pm

#67 Sucks paying rent
Quoting the Telegraph, eh.
You’d think they’d be busy reporting on the UK’s sordid state of affair.
But no, they are distracted by Germany’s energy problems, that are being solved as we speak.

#73 DON on 08.29.22 at 11:27 pm

https://www.zerohedge.com/personal-finance/narrative-housing-shortage-beginning-crumble

The state of housing affairs in the US.

Gee where did we hear that over and over and over again. Thanks Mr. Turner.

#74 DON on 08.29.22 at 11:36 pm

#63 Ronaldo on 08.29.22 at 9:34 pm
#59 Flop…

Someone just bought this home for 1.04 on the North Delta side of the border.

https://www.zealty.ca/mls-R2716465/11441-95-AVENUE-Delta-BC/
————————————————————-
Well, they didn’t do so bad at $131,600 under the July 2021 assessment but still $181,300 over the prev. 2020 assessment of $858,000. No sales history in the last 3 years so they are still laughing all the way to the bank.

It is people that are sitting on huge equity that have bought years ago that are having to sell and will take these large drops knowing that they still win the lottery. The people who suffered with FOMO are going to be very very sorry with what is yet to come.

*******
As always, very sensible oulook.

Will be watching the Cumberland market closely.

#75 North Delta on 08.29.22 at 11:50 pm

Someone just bought this home for 1.04 on the North Delta side of the border.

2020 assessment of $858,000.

I used to live in North Delta and that place isn’t worth even $858K.

#76 yvr_lurker on 08.30.22 at 12:05 am

#71
Hear, hear. You are right. Gotta protect us Rentiers.
——-
Yup, and that is exactly what is wrong in the tax code. Tax increases seem to focus on marginal rates, while after much hang-ringing taxation on investment income barely budges after powerful forces intervene. Why should I bother taking on extra admin duties that would entail me to be tied to bosses who can ring me on the cell phone day and night, losing my holiday period, for an extra 15K per year, when I get to see 575.00 per month extra after T2 gets his share. Turned such a promotion down this summer, as it is not worth the significant extra stress. If T2 raises marginals to 60%, it is clear there is no point.

#77 Neo on 08.30.22 at 12:44 am

France: our rivers are drying up.

Germany: our rivers are drying up.

China: our rivers are drying up.

Pakistan: 60% of the country is under water.

Canada: we have free non existing health care.

Turner Investments: pay me 1% of your net worth each year to invest in a bright prosperous future.

#78 DON on 08.30.22 at 1:50 am

https://www.zerohedge.com/personal-finance/american-drivers-go-deeper-debt-inflation-pushes-car-loans-record-highs

Yikes!

#79 Bast on 08.30.22 at 1:58 am

Hey crowdedelevatorfartz! You forgot about Theresa May – Liz Truss would be Britain’s 3rd female PM…

#80 Hamboigla on 08.30.22 at 2:03 am

Massive whopper of a recession in 2023…
M2 M2 M2!
https://www.cnbc.com/2022/08/30/steve-hanke-were-going-to-have-one-whopper-of-a-recession-in-2023.html

#81 Digger on 08.30.22 at 2:31 am

Rex Murphy hits it out of the park.

https://nationalpost.com/opinion/rex-murphy-environmentalists-biggest-triumph-was-to-aid-vladimir-putin

Can you still hear the lunatic left pols laughing at Trumps suggestion that they were really screwing up?

#82 Jane24 on 08.30.22 at 2:57 am

crowdedelevatorfartz
Gee.
Will Britain’s Conservatives elect the second female Prime Minister?
Sept 5th.

Liz Truss looks like a shoo in for the PM position.
Massive inflation. Union strikes. Rising interest rates.
Seems like Maggie Thatcher’s reign all over again.
We won’t need the Falkland War to get her popularity up in the polls….when we have Russia.

——————
You mean Britain’s third female PM, not second. You forgot Teresa May. Yes it will come to pass as I am a Tory member and yes all my member friends voted for her as the least disappointing of two poor choices. As the old saying goes “he who uses the knife, will never wear the crown.” Goodbye Rishi.

And yes we have bloody strikes everywhere. Every union is going for the 10% inflation plus. Time to go to Portugal if Ryanair stops striking and I can get out of Gatwick to enjoy the Fall. Maybe take the car ferry from Portsmouth to Porto. We are going beach house hunting.

#83 Joe Lalonde on 08.30.22 at 5:19 am

Hi Garth.

Nobody seems to ask why Canada has a million job positions available?
And increasing…
Since this Pandemic started, the supply chain infrastructure broke away from our economic dependency on imports of globalization as needing government approval to do anything is our current monetary policy system.
Rather than being a smart country and adapt to the situation, our politicians are still all into a system that no longer is available or exists.
As our made in China products break and our oldest infrastructure is no longer available or created anymore.
Not hard to see the old industries in decay to realize that they were at one time vital to our infrastructure.

I used to be able to work from no qualifications off the street but that long ago became illegal.
Any of my training skills no longer is qualified unless it’s updated frequently or needing a multitude of payments to the different government regulations. Just hiring a helper wasn’t a viable option with government regulations for a multitude of areas.
I became extremely good at generating my own extra hand when needed.

Our society isn’t going to be comfortable as it breaks…on this Trudeau ship…full steam ahead…damn the icebergs…

#84 Is anybody listening? on 08.30.22 at 7:32 am

DELETED

#85 maxx on 08.30.22 at 8:09 am

@ #3

The serfs have been busy drumming up new ideas to preserve and reinforce work from home in their jammies.

Yesterday, a radio talk-show host was yammering on about a new WFH concept: tax people according to the number of kilometers driven in any given year. Ergo, those who work from home are considered ¨greener¨ and would therefore be privvy to lower taxes.

This economically cancerous crap needs to be called out and lazy-a$$ Canucks kicked back to work, or to the curb. Their choice.

Btw, I´d love to know at what level of gubbmint this idiotic notion likely originated.

Mr. Powell, do your thing.

#86 Is anybody listening? on 08.30.22 at 8:13 am

Europe’s Economic And Social Suicide – Provoked by The U.S. And Helped Along By Europe’s Leaders

https://www.moonofalabama.org/2022/08/europes-economic-and-social-suicide-provoked-by-the-us-and-helped-along-by-europes-leaders.html#more

#87 crowdedelevatorfartz on 08.30.22 at 8:18 am

Teresa May!
By God she was in that job and out so fast I forgot all about her.
My bad.
Lets hope Liz lasts longer.
A very angry voting public out there and the Cons didn’t do themselves any favours with bumbling Boris at the helm.
Just wait til the heating bills hammer every poor sod in Blighty.
Guy Fawkes wont be the only thing burning in effigy this Fall.

#88 2SLGBTQI+ on 08.30.22 at 8:22 am

“Don’t know what 2SLGBTQI+ stands for? Ottawa helpfully explained that it stands for “Two-Spirit, lesbian, gay, bisexual, transgender, queer, intersex, and additional sexually and gender diverse people.” The nine-character moniker is “more inclusive” than LGBT, they explain.”

Not gonna lie to you, I kinda feel excluded from this club.

#89 10 Bagger on 08.30.22 at 8:42 am

Tucker Carlson quipped a photo of Trudeau wearing a fancy native headdress with the header “ Trudeau finds a hundred million for bi-sexual eskimos”. Naturally story went viral instantly and the reaction internationally is not positive.

https://www.cbc.ca/news/politics/federal-action-plan-lgbtq-1.6564977

Justin should be an event planner. He might be good at that.

#90 Brian on 08.30.22 at 8:47 am

We have an economy that is either flat on its back or mildly contracting, depending on the macro measure used. The bulls go on about earnings season and the better-than-expected 8.5 per cent year-over-year expansion in Q2, but strip out energy, and that trend becomes -2.2 per cent. And real rates going up, courtesy of the Fed, means one thing and one thing only: P/E multiple contraction.

This bear market rally met its maker last week (his name is Jay). To quote Dandy Don from the blowout Monday Night Football games in the 1970s, “Turn out the lights, the party’s over, they say that all good things must end.”

https://financialpost.com/investing/david-rosenberg-time-to-get-defensive-as-fed-chairs-pain-comment-unravels-markets

#91 Ponzius Pilatus on 08.30.22 at 9:04 am

#88 2SLGBTQI+ on 08.30.22 at 8:22 am
“Don’t know what 2SLGBTQI+ stands for? Ottawa helpfully explained that it stands for “Two-Spirit, lesbian, gay, bisexual, transgender, queer, intersex, and additional sexually and gender diverse people.” The nine-character moniker is “more inclusive” than LGBT, they explain.”

Not gonna lie to you, I kinda feel excluded from this club.
——————————
Why would you wanna belong to a club which members are stoned to death in certain countries like Nigeria?
Live an let live.

#92 millmech on 08.30.22 at 9:13 am

Meme stocks out performing the B&D portfolio, get in set a percentage and get out. Lots of people make money on memes just do not bag hold.
With taxes going up RRSPs are looking more like a fools game.

#93 Summertime on 08.30.22 at 9:33 am

Fighting expected UK CPI of 22 % (inflation of necessities even higher) with ‘potential 4.5 %’ rates.

https://ca.finance.yahoo.com/news/uk-inflation-could-top-22-114231529.html

Way to go, central bankers!

#94 crowdedelevatorfartz on 08.30.22 at 9:33 am

@#88 2SLGBTQi+

“Not gonna lie to you, I kinda feel excluded from this club.”

+++
True.
But the $100 million dollars raining down from Liberal heaven upon every inclusivity center across Canada will be absorbed like a light rain shower in the vast Sahara….with about as much effect.

Inclusivity doesn’t necessarily equate to accountability…
The bureaucrats will have that money spent in no time.

#95 epic bear on 08.30.22 at 9:34 am

and in more good news for the world economy…

1. Norway considers suspending electricity exports to avoid an energy crisis

Europe’s leading electricity exporter, confronted with the reservoirs of its hydroelectric plants drying up, must propose a solution.

2. Alcoa To Curtail One Third Of Its Production Capacity At Lista Smelter (Norway)

good thing aluminum and electricity aren’t important

i guess it’s better to chop wood and eat crickets to save the planet.

#96 Autobahn on 08.30.22 at 9:42 am

#88 2SLGBTQI+

I thought it was maybe…

Mercedes Benz 2SL Groß Bi-Turbo Quad-Injection+

(FYI: Groß is Big in German)

#97 Sail Away on 08.30.22 at 9:49 am

#88 2SLGBTQI+ on 08.30.22 at 8:22 am

“Don’t know what 2SLGBTQI+ stands for? Ottawa helpfully explained that it stands for “Two-Spirit, lesbian, gay, bisexual, transgender, queer, intersex, and additional sexually and gender diverse people.” The nine-character moniker is “more inclusive” than LGBT, they explain.”

Not gonna lie to you, I kinda feel excluded from this club.

———

Just join, on your own terms. Be ‘7-enigmatic’.

I’ll be on your team. Then we get grant funding from the $100m to spread our message of, I guess, genitals and strange and exciting things one can do with them.

I find this intense media+govt interest in new and unconventional methods of sticking, pushing, sliding and poking frivolous, and honestly, a bit unsanitary.

#98 Tim on 08.30.22 at 10:21 am

“Wages gains will be reduced, workers will have less leverage and employers will gain a stronger hand.”

Is that supposed to be a good thing?

#99 bdwy on 08.30.22 at 10:38 am

just pulled the pin on brk.b. 1500 shares. cant see much upside right now.

done my work for today.

#100 epic bear on 08.30.22 at 10:50 am

those that think “inflation” has peaked are smoking some real good herbs…

24% wage increase, 14% immediate..

US Freight Railroads Reach Tentative Deals With Three Unions

“…the terms reflect the board’s recommendations, including a 24% wage increase through 2024, with a 14.1% increase effective immediately, according to a statement Monday by the National Carriers’ Conference Committee.”

https://www.bloomberg.com/news/articles/2022-08-29/us-freight-railroads-reach-tentative-deals-with-three-unions#xj4y7vzkg

#101 Barry bitcoin on 08.30.22 at 10:55 am

Garth,
What do you think the bottom on bitcoin is? Am forecasting 12…is it better to but bttc etf or bitcoin directly from broker?

#102 Outrage on 08.30.22 at 10:58 am

Yes, Mistakes. When you’re not shorting this market. The bloodbath continues but you need to be diversified. I’m waiting for 2008 lows, then I might take some longs. The fed can’t fight inflation at these laughable interests rates so buy anything you need because the price will be higher. They may lower rates and print more money but it won’t work this time. Be very prepared for this downfall.

#103 Shawn on 08.30.22 at 11:01 am

6% return and possible 6% inflation

Garth reminds us that a 6% return turns $250k into $600k in 15 years. (I trust ya all got at least that $250 already if you are 50 years old or more)

That is impressive.

But I hope inflation subsides. 6% inflation turns a $17 hamburger and side dish at a casual restaurant into $41 in 15 years. With 15% tax and minimal 15% tip you are at $22.50 today and $54in 15 years. And you have not added in a drink of any kind yet. (Better stick with water) Yikes. Gotta get inflation down.

Or buy some units of those restaurant royalty trust outfits.

#104 the Jaguar on 08.30.22 at 11:14 am

No snippets today. All the stories in the funny papers aren’t very funny. If this isn’t the predicted “Fourth Turning” I don’t know what is……

#105 Faron on 08.30.22 at 11:14 am

#97 Sail Away on 08.30.22 at 9:49 am
#88 2SLGBTQI+ on 08.30.22 at 8:22 am

I find this intense media+govt interest

Funny, the most intense interest seems to come from right/far right media. And/or you, clowny, or Old aBoot. Usually that indicates feeling threatened and/or a little envious or just ruling up a base of trolls. Light in the loafers ring any bells?

#106 Faron on 08.30.22 at 11:20 am

2s10s inverted by 34 BP. SPX gave back 7.8% from recent high, 5.4% since latest SAGI. Good thing the recession was declared cancelled by Herr professor(guest lectured in a class once) Away.

#107 Quintilian on 08.30.22 at 11:38 am

#73 DON on 08.29.22 at 11:27 pm
https://www.zerohedge.com/personal-finance/narrative-housing-shortage-beginning-crumble

“The state of housing affairs in the US.

Gee where did we hear that over and over and over again. Thanks Mr. Turner.”

Shhhh, please Don, we do want to perpetuate the myth.
It will ultimately serve the bears well.
Just go along with Honest Realtor for now.

Remember we are running out of land, and billionaires from all around the world will someday move to Canada.

#108 Don Guillermo on 08.30.22 at 11:57 am

#91 Ponzius Pilatus on 08.30.22 at 9:04 am
#88 2SLGBTQI+ on 08.30.22 at 8:22 am
“Don’t know what 2SLGBTQI+ stands for? Ottawa helpfully explained that it stands for “Two-Spirit, lesbian, gay, bisexual, transgender, queer, intersex, and additional sexually and gender diverse people.” The nine-character moniker is “more inclusive” than LGBT, they explain.”

Not gonna lie to you, I kinda feel excluded from this club.
——————————
Why would you wanna belong to a club which members are stoned to death in certain countries like Nigeria?
Live an let live.
*******
What’s great about Canada is in spite of their shortcomings we still help these poor lost souls out.

Canada’s Oil Imports
Currently, more than half the oil used in Quebec and Atlantic Canada is imported from foreign sources including the U.S., Saudi Arabia, Russian Federation, United Kingdom, Azerbaijan, Nigeria and Ivory Coast. In 2019, Canada spent $18.9 billion to import foreign oil.

#109 Steven Rowlandson on 08.30.22 at 12:13 pm

With the advances in robotics and automation employers may indeed find it possible to dispense with employees altogether. On the other hand where are all the customers going to come from if there is little or no employment? There seems to be some missing factors in the economic equation…The capitalist dream world is as ill conceived as the communist one.

#110 Faron on 08.30.22 at 12:39 pm

#108 Don Guillermo on 08.30.22 at 11:57 am

In 2019, Canada spent $18.9 billion to import foreign oil

For an Albertan, you know surprisingly little about oil markets. ¯\_(ツ)_/¯

#111 TurnerNation on 08.30.22 at 12:41 pm

Ah, the nebbish and effete ‘climate changes’ taking over the comment section.

#112 earthboundmisfit on 08.30.22 at 12:45 pm

#108 Don Guillermo

Solely for inclusiveness, I find that the simple
“LGB-etc” (hyphen optional) works quite well.

#113 NJ on 08.30.22 at 12:58 pm

“Sticking the wad into a bag of [email protected] mutual funds would be a mistake, watching 2-3% management expense ratios cannibalize returns”

Not a single person in history has ever said “I couldn’t retire” or “I didn’t hit my goals” because of MER fees. This is the most overblown thing I hear on this blog. Sure, better ways to invest. But MER should not be a deal breaker. I know plenty with comfortable retirement funds that were in Big Bank Mutual Funds…they’re fine.

They could have been a lot better. Those fees are unjustifiable. – Garth

#114 Shawn on 08.30.22 at 1:00 pm

What if there are no jobs?

#109 Steven Rowlandson on 08.30.22 at 12:13 pm

With the advances in robotics and automation employers may indeed find it possible to dispense with employees altogether. On the other hand where are all the customers going to come from if there is little or no employment? There seems to be some missing factors in the economic equation…The capitalist dream world is as ill conceived as the communist one.

*****************************
The long-predicted jobless future is very much on hold. There are jobs galore.

But in the future when there are no jobs we will all simply own shares in the robot producers. I am looking at Linamar right now. They have well over 1000 advanced robots and are a very ambitious company.

If the robots will take the jobs then we must own the robots.

#115 Ponzius Pilatus on 08.30.22 at 1:05 pm

#109 Steven Rowlandson on 08.30.22 at 12:13 pm
With the advances in robotics and automation employers may indeed find it possible to dispense with employees altogether. On the other hand where are all the customers going to come from if there is little or no employment? There seems to be some missing factors in the economic equation…The capitalist dream world is as ill conceived as the communist one.
—————————-
Then there’s gonna be UBI for everyone, even robots.
Read somewhere that Zurich is having a referendum on introducing a guaranteed wage for everyone.
Interesting, because the Swiss are usually not the bleeding heart types.
Very results driven.
So they must find something in it.
Let’s see how it goes.

#116 Faron on 08.30.22 at 1:07 pm

#100 epic bear on 08.30.22 at 10:50 am
those that think “inflation” has peaked are smoking some real good herbs…

24% wage increase, 14% immediate..

US Freight Railroads Reach Tentative Deals With Three Unions

I absolutely agree. J Pow mentioned that inflation needs to be crushed before the wage/price spiral takes hold. Your comment and similar data show that it may be too late. Brief pause in inflation here then the scorpion tail strikes when prices rise to pay for the higher wages. At that point, the cycle will be “entrenched” and serious rate hikes will be needed.

#117 2SLGBTQI+ on 08.30.22 at 1:20 pm

Don’t know what 2S (two spirit) is? Neither did I. Here is what Wikipedia says.

The term Two Spirit (original form chosen) was created in 1990 at the Indigenous lesbian and gay international gathering in Winnipeg, and “specifically chosen to distinguish and distance Native American/First Nations people from non-Native peoples”

Doesn’t read inclusive to me.

#118 jess on 08.30.22 at 1:30 pm

“Canadian children were taught in school that Canadian natives were inferior to non natives. ”

When people witness disease/death killing women and children from something/someone alien to their culture who says their god is better than their gods and conversion cures or heaven awaits …..
https://www.thecanadianencyclopedia.ca/en/article/jean-de-brebeuf

Perhaps this was learned perhaps from parents? If people looked beyond and back earlier and earlier they might learn how the myths relate. I think people who quote bible passages from king james need to go back to the Summerians
https://www.worldhistory.org/article/71/sumerian-civilization-inventing-the-future/

=
stealing a kids lemonade stand ?with kids in his car ?what message does this send (the star)

#119 bdwy on 08.30.22 at 1:31 pm

“The capitalist dream world is as ill conceived as the communist one”

comedian day on the blog it seems.

capitalism will chug along unaffected, continuing to reward people who provide value (products or services) to their fellow humans. like our blog host does.

if a robot can replace your job you best find another way to provide value to other people.

#120 Sail Away on 08.30.22 at 1:49 pm

Faron, you have referenced/disparaged me in 2/3 of your comments today. Clearly, your obsession with moi rages unabated, even after the clear disgust shown by other commenters after your last 50 comment freakazoid of insults and name-calling last week.

The truth is… I don’t really mind. On the other hand, you clearly do. And nobody wants to see it. No commenters will say, ‘Please, Faron, fight with Sail Away more. We love it.’

This response is probably bad because it feeds some insatiable hunger for my attention. Just like my dogs.
But then I like them. Sigh.

#121 Shawn on 08.30.22 at 2:00 pm

Buying and holding shares in individual companies is effectively riding the coat tails of the leaders of those companies.

And you have to expect that those coat tails will flap around in the wind quite a bit. Often, seemingly, in a bid to shake you off. If it’s a good company and well managed then just hang on tight. You, unlike most, can handle it.

#122 Gender Politiks on 08.30.22 at 2:11 pm

#105 Faron on 08.30.22 at 11:14 am
#97 Sail Away on 08.30.22 at 9:49 am
#88 2SLGBTQI+ on 08.30.22 at 8:22 am

I find this intense media+govt interest

Funny, the most intense interest seems to come from right/far right media. And/or you, clowny, or Old aBoot. Usually that indicates feeling threatened and/or a little envious or just ruling up a base of trolls. Light in the loafers ring any bells?

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

Can probably skip the homophobic slurs, pretty outdated now.

No surprise you’d try and dismiss any objection to 100 million unaccountable dollars spent furthering divisive gender politics as “far-right”.

Maybe they can spend some more with this fine outfit. What a lovely chap this Laith Marouf seems, you’d probably enjoy coffee with him.

https://nationalpost.com/opinion/rex-murphy-whats-the-liberals-excuse-for-hiring-an-anti-racist-who-spews-antisemitism

Some members of the “inclusive” club are a little more “included” than others, it seems.

#123 jess on 08.30.22 at 2:15 pm

the dark purple =25% overvalued

https://fortune.com/2022/08/24/housing-market-falling-home-prices-2023-downgraded-forecast-moodys-analytics/

#124 TA on 08.30.22 at 2:27 pm

Negative divergences in NQ1 RSI and price at hourly and 15 minute intervals. Prob a good time to get long for a bounce.

#125 Shawn on 08.30.22 at 2:27 pm

The Canada 10 year government bond is yielding about 3.1%.

Garth says no one buys these for the yield. Well, people and institutions can buy for safety to to speculate that rates will fall and give a capital gain.

But this bond issued today at $100 will not know or care why anyone bought it. It will most assuredly simply pay the 3% annual return over its life to whoever owns it.

Any capital gains will be followed by capital losses as it will most definitly mature in ten years at $100.

I can’t see any reason in the world for a retail investor to even think about buying it. You can get more on a GIC

And if you think you might want to access the cash and sell earlier than ten years then just buy a shorter GIC.

Or buy a good dividend stock. Or Buy a balanced ETF like VBAL. Or create a B&D out of no more than 10 ETFs. (And don’t be afraid to throw some GICs into that mix.)

Just no reason to think about buying the 10 year government bond at its 3.1% yield.

Pension funds, insurance companies, the mega wealthy and banks must be holding their nose when buying this. These players are all too big for GICs and have fewer choices than we do.

#126 Wrk.dover on 08.30.22 at 2:37 pm

I sold TOU pre open and realized 42% since Mar 29, factoring the divs.

Should have followed with my ARX, KEY and PPL, as it turns out they fell 3 times more thus far today. I had figured they weren’t so meteoric in rise and pay real divs.

Meanwhile that Atlantic equatorial cloud I posted on Thursday or so has dissipated but, a developed a healthy counter clockwise spin up to and above 50,000′, maybe it is going to put oil back on the heat map in green!

#127 kommykim on 08.30.22 at 2:41 pm

I know it’s rare, but a guy I used to work with commuted his DB pension and put it in the hands of a corrupt “advisor” who left the country with multiple clients money. He never got it back.
Maybe it’s worth doing with a private DB pension, but I’d never do it with a government backed one.

Caveat emptor. That was no advisor, and the story is pointless. – Garth

#128 jess on 08.30.22 at 2:41 pm

Forget quiet quitting, managers are running off talent by quiet firing
Passive aggression is having a moment in the workplace as leaders contend with quiet quitting, and the latest workplace phenomenon: quiet firing.
https://fortune.com/2022/08/30/forget-quiet-quitting-managers-running-off-talent-quiet-firing/
============
Only a committee of economists at the National Bureau of Economic Research (NBER) can officially declare that the U.S. is in a recession.

“The Fed Listens”
Speech

August 27, 2020
New Economic Challenges and the Fed’s Monetary Policy Review Chair Jerome H. Powell

At “Navigating the Decade Ahead: Implications for Monetary Policy,” an economic policy symposium sponsored by the Federal Reserve Bank of Kansas City, Jackson Hole, Wyoming (via webcast)

https://www.federalreserve.gov/newsevents/speech/powell20200827a.htm?msclkid=9b13de8aaa0f11ec9a767a3d205dfc12

#129 baloney Sandwitch on 08.30.22 at 2:51 pm

The best investments are made when you are sh**ing bricks. I am feeling a brick being baked in my bowels just about now.

#130 NoName on 08.30.22 at 3:13 pm

#109 Steven Rowlandson on 08.30.22 at 12:13 pm
With the advances in robotics and automation employers may indeed find it possible to dispense with employees altogether. On the other hand where are all the customers going to come from if there is little or no employment? There seems to be some missing factors in the economic equation…The capitalist dream world is as ill conceived as the communist one.

Self check out is not automation, at least in my mind. Here is best and vorsed example of automation.

https://twitter.com/nikitonsky/status/1562037915122794496?fbclid=IwAR34J0kE5b1eJ96YqQfcEtFjPyqKMmJVfnzcVWRu25JjHy6coQmryO34lzY

#131 Faron on 08.30.22 at 3:24 pm

#118 Gender Politiks on 08.30.22 at 2:11 pm
#105 Faron on 08.30.22 at 11:14 am

Can probably skip the homophobic slurs, pretty outdated now.

Whole hearted agreement. I would never use that slur. It’s disgusting. Look up your steerage history and you will see why I bring it up. Mr. Weight watcherz is your source.

#132 Faron on 08.30.22 at 3:30 pm

#120 Sail Away on 08.30.22 at 1:49 pm

Maybe, uh, don’t reference my comments, refrain from SAGIs, and quit with the FYIGM attitude (i.e. reaching into the gender diversity pot while corunning an engineering firm staffed solely with white 20 something presumably cis-males – correct if wrong) and you won’t hear from me. Unfortunately, as the most linguistically deft, you get to be the lightning rod for all that is gross about the conservatives who comment here. Sorry-not-sorry.

#133 Woo Young-woo on 08.31.22 at 2:17 pm

“Sticking the wad into a bag of [email protected] mutual funds would be a mistake, watching 2-3% management expense ratios cannibalize returns”

Not a single person in history has ever said “I couldn’t retire” or “I didn’t hit my goals” because of MER fees. This is the most overblown thing I hear on this blog. Sure, better ways to invest. But MER should not be a deal breaker. I know plenty with comfortable retirement funds that were in Big Bank Mutual Funds…they’re fine.

They could have been a lot better. Those fees are unjustifiable. – Garth

I work for a big 6 bank (the blue one) and I couldn’t agree with Garth more.

Woo Young-woo. (Whether it’s read straight or flipped. Kayak, deed, rotator, noon, racecar, Woo Young-woo).