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Is China headed toward collapse?
Everyone says China is the key to success. To add to what geithner says, consumer spending in the US accounts for 70% of US GDP. This holiday season is going to be AWFUL. China's economy is based mostly on US demand for their shit products. If this christmas season is bad, no matter how they fudge the numbers.......they are going to need MASSIVE stimulus again to keep this boat righted.
Im playing Symbol: SRS ultrashort US real estate FTW
If for some reason this "recovery" continues where superman and the terminator combine to make one ultrabeing that is even stronger than Obama, then we'll be fine. The only crappy thing about that situation would be predator, T2000 & Lex Luther walking around throwing krytonite and turning into knives :P ....i guess you gotta give a little to get a little.
PS - were more likely to see T2000 etc than an economic recovery!
And while we are at it lets also remember these Canadians
WW 1 approx 60,000
ww 2 44,198
Korean war 1,558
And the count is still going here
http://www.mysteriesofcanada.com/Military/canad...
"The S&P/TSX composite index jumped 230.7 points to 11,481.1 after rising about three per cent last week despite employment reports from Canada and the United States on Friday that came in much worse than expected.
But investors consoled themselves that interest rates are unlikely to rise in such a weak economic environment.
And investors got good news from the weekend gathering of officials from the G20 countries, including Canada, that governments are in no hurry to cut off stimulus measures."
http://money.ca.msn.com/investing/news/business...
Looks like unemployment has no impact on the stock market anymore. It is now a useless measure for stock valuation. Plus, more stimulus means more money for Wall Street to gamble with. Win win anyone?
http://toronto.ctv.ca/servlet/an/local/CTVNews/...
and so it goes.....
Now get out there and buy that bubble priced carboard house over a 35 year repayment plan. Don't believe the facts, the math, what it costs to rent, or your gut, trust your realtor, they have your best interests at heart, really, they do, and they use their professionalism and expertise daily to make sure you get screwed the very best that they can screw you.....oooopppss....had a little bit of a truth slip up there.....heh.
I found this to be an interesting read.
http://www.gata.org/node/7911
"bootcut
Nov 6, 2009 5:46 AM GMT
Once a employer finds out he can still maintain production capacity by working the remaining employees twice as hard, where is the incentive for him to hire? When one burns out you just replace them with another from the large pool of unemployed. Just like a light bulb."
To go further on this statement where is the evidence that employment will increase in this scenario where companies are getting those left in the workforce to slave harder and faster than before when we have lost and continue to lose our competitive and exporting edge to China and India. We continue to manufacture and export less and import more.
The harsh reality is that the economy is probably where it really is supposed to be considering our debt levels, productivity, output, etc. We were probably supposed to be at this level and were only capable of sustaining at this level if not for our recklessness, greed and appetite for debt. We are probably now in an economic phase where our economy is not operating on and reflecting speculative growth but is grounded in reality given our existing economic constructs. Thus, we may be looking at this current economic cycle for a long time given that the employment picture will remain stagnant for the forseeable future.
I sure a few bloggers here will challenge that idea, how can anybody dare to question the govt,s stats or the banks or the real estate industry stats, they have no reason to manipulate the stats right?
High and rising unemployment, SO WHAT! don't we have "Recovery', Green shoots" even "high Gold prices"? doesn't all that count for somethings?
Real estate is ONLY about 2x over value in Alberta but with recovery, green shoots, and high gold prices, it should translate into even higher and more over-priced real estate prices until the end of time, and don't forget to take advantage of the 35 years "Easy Payment Plan".
A wise birdie told me long ago to always take physical delivery of your bullion and put it in a safe.......never to buy gold certificates or any other paper saying you owned a piece of gold.......great article BTW........!!!
Suncor to sell billions in assets
The economy is still being propped up by stimulus which may delay continue the counter trend rally but the overall market direction still remains down.
I wanted to look and see what countries are even able to borrow as compared to their GDP and it was disgusting what they are able to do with Great Britain being the largest swine of them all. 375% of GDP is their current debt load. If the states does the same (Currently at 95%, CAN @ 59%) then they could borrow more than 30 trillion more to help this "recovery"
Here's the source of the GDP data.....it depends on who you look at for #'s (IMF, World Bank, CIA) but the %'s wont change too much in the grand scheme.
http://en.wikipedia.org/wiki/List_of_countries_...
http://en.wikipedia.org/wiki/List_of_countries_...)
This just came out today
Short - Oil, Gold, Silver
Bet - US Dollar and any ETF that shorts the states economy
Maybe the false counter trend continues until Christmas but after the buying season, earnings will be very poor and the market will pay
I wouldn't touch the US dollar with a ten foot pole.
US dollar is devastated.....its a very risky play but its still the worlds currency. Check out the correlation of this index chart to the S&P or DJIA. Unless you think that the market will continue with its strength then the dollar will be the driver of the fall of the market. Also, countries like China & Japan have to keep the value of the dollar high. They own over 1.5 trillion in US Debt. Is the us dollar goes down the toilet, then so do their "investments".
http://www.fxstreet.com/rates-charts/usdollar-i...
If that article is even 80% true, then look for gold bullion to be worth 5000 an ounce! That'll be a rude awakening for all of us.
He expects the prime rate to rise from today’s 2.25 up to 4.75 moving into late 2010 and 2011."
From the most UNLIKELY source: Cameron Muir. Former CHMC head and current B.C. Real Estate Association’s chief economist!
http://www.kamloopsnews.ca/article/20091105/KAM...
Wah?!?!?!? I see pigs flying outside my window in the dark!
When the real estate pumpers start spewing this stuff...Run for the Freaking Hills!!!!!
* Guest
Carioca Canuck 1 day ago
"In today's Herald drilling companies are reporting that 2010 activity will be down by 50% of this year.....which was dismal.
Keep buying Alberta RE people......."
http://www.calgaryherald.com/Drilling+outlook+f...
CC,
The forecast isn't for the industry to fall an additional 50%. They have adjusted a previous forecast by that amount. They expect activity to decrease 5% in Alberta in 2010, which is still pretty bad.
http://www.calgaryherald.com/Drilling+outlook+f...
CALGARY - Alberta's oil and gas service industry will lag its neighbours in 2010, experiencing a five per cent slide in drilling activity, while British Columbia, Saskatchewan and Manitoba will see increases, according to a new outlook.
It said they predicted a drop of 50% from this year's numbers in 2010. Maybe it has now been "unexpectedly revised" like everything else.
No matter....still not good, regardless of which report you read.
A Canadian Says "Short Canada"
long time no post, things are quiet and boring here without you, please keep us inform, thanks in advance.
I look at commercial property, because I would think that investors in this type of property would do more due diligence. Anyhow, prices still seem way too high. Seems like the typical property could make 4-5% before property tax, maintenance, and this is assuming you can rent it out. I've been reading that vacancy has shot up, and is expected to go higher.
I wonder if commercial could lead in a mini-crash. You kind of expect average people to be a little more emotional about their home ("everyone wants to live here, this is the greatest place on earth" or "but my house is worth more than my neighbors because it's nicer because of....."), but I would think that commercial property owners should see the writing on the wall when vacancy goes up, or interest rates rise.
What do you all think?
i truly thought that gloria had shut this blog down and now i regret the name i used for it as i didnt mean to counterfeit this blogs name i simply wanted the albertabubble blog to continue
your 100% right about the housing industry
its currently very boring
i heard mark carney threaten to slow the market by using various tools that are at his disposal such as requiring a larger down payment or bringing back common sense rules such as not allowing mortgages that have a longer than 25 yr amortization
wouldnt the realtors wail if such common sense rules were implemented
Their was a time when cmhc was good for first time buyers
but its currently a pimp for the REIC and supported with taxpayer monies
cmhc has caused home prices to become unaffordable with their gimmicky rules
until the cmhc is reined in or interest rates return to normal sensible levels i cant see a lot of change in the current housing market as its dominated by speculators backed by the canadian taxpayer looking for free and easy money
but one thing for sure is that once all the band aids that the government has deployed ends
the canadian housing crash will be gargantuan causing major damage to our financial institutions and to hundreds of thousands of canadian mortgage owners
the government has made sure of that
It is so refreshing to see the good ship “FOOLS” drifting about aimlessly on the sea of eternal stupidity.
For example, let us chat pleasantly about gold. The previous posts about this topic pontificated incessantly, as to the cause of its recent price rise. The notion but forth that the global amount of this commodity is stationary. See how uneducated you all are, the light went on, right, they dig this stuff out of the ground on a minute-by-minute basis. The global inventory is increasing. What is driving the price is speculation by recently acquired wealth in eastern foreign countries. When is it going to sink in, that the old economic theories of say, "supply and demand", are dead, long live fascism.
Is see the ship of fools has it old Capitan back, the chief dolt, praise the gods of retardation.
arnt you supposed to be on your 6 month cross country skiing sabbatical by now ?
btw gold is a simple currency trade at the moment
its far easier and less burdensome to gamble with forex
if gambling turns you on that is
DOW
2007 14,200
2008 8,046 -44%
2009 6,626 (Mar) -53%
2010 ?
stormy you said that i was a mental when i warned of the impending stock market crash in the spring of 07
the only reason that the canadian housing market hasnt crashed yet is due to government interference
but that to will end
realtors such as bob trumen should be credited with this blogs success as he has called calgarians every name imaginable
hes wished prostitution and death on calgarians
commonly talks about guns and violence
and continually threatens calgarians that have opinions with law suits and police intervention
he has even stooped so low as to put a link on his website with what his his warped mind envisions me to be http://www.bobtruman.com/Squidly_photo/page_2267545.html
he continually touches up posters posts on his blog and censors others
and he obviously hates carioca
he has single handedly driven the calgary blog dawgs
hes a complete ass and quite obviously has mental health issues but hes so narcissistic that he will never know it
but the people that are around him will know
sheldon johnson has also fueled this great blog
hes much more the professional compared to truman but he has also posted many mis-truths
and exaggerations
previous clients of his will soon turn against him
what a f*ck low life piece of shit, a disgrace!
shouldn't this guy concentrate on ruining families by coerce them into buying over priced houses in Calgary instead of stooping down to that level? but wait it's hard because you are in his way.
Many people here have suggest that some of the rude and disruptive bloggers here might be BT, I doubted that idea but I can clearly see the similar tactics and motives from that link and many of the spam postings here, they are exactly the same, unbelievable for some one in his field of work would stoop down that low, he calls himself a "professional"? more like a "professional Loser".
Squidly, honest truth, you along with Gloria, jim s, CC and many others on this blog have saved my family at least $150k, (that's no Realtor type of BS), that's why realtors and greedy speculators hate you guys here, especially squidly.
I talk to my family members all the time about how lucky we are to be debt free and not in financial ruin, thanks to every decent person here and especially Gloria for keeping this blog going, with out these blogs and decent posters like squidly, we would all be brainwashed by the govt, bankers and realtors.
“I don't check out BobTruman's blog anymore, what a waste of time. No facts, no proof, just a pro-realtor censored blog. Udder crap.”
Then later commented on Bob's blog.
back in the days (2007- early 09) you were one of the people here who opened my eyes, I didn't forget that.
Please give yourself a barium enema so you can pull your head out of your ass.
Also, would you like to exchange linnks with my site http://thecomingdepression.net? Thanks
How does the Loser rental crowd explain the recent upsurge in Calgary’s R/E prices, eh, oh I know the prices actually went down.
Idiots.
Since the start of this blog Rent has gone from around 700 pm to 1500 pm.
Very incisive. Moron.
Actually, Suidly I have become to belief you are a deranged bully that has with gay abandon destroyed the finical future of ordinary Calgary families.
are things not going so well..oh well its only money (yours that is)
lets see whats happened since 2007
stock markets have crashed 50%
oil is back where it should be although i think its still a little high
the price of nat gas has been obliterated probably forever
calgarys unemployment rate has risen from 3.2% to 7.6% +130%
houses are $50,000 cheaper now
the only reason that they haven't crashed yet is government interference
mortgage amortizations have gone from 25 yrs to 40 yrs and are back to 35 yrs
down payments went from 5% to 0% now back to 3.5%
BOC rate has dropped from 5.25% to 0.25%
rents are definitely cheaper now than they were in 2007
houses are $50,000 cheaper now
i am sure that many people are regretting buying real estate in calgary or alberta or anywhere on the entire planet
A real eye opener to what being in debt really means.
http://www.newcreditrules.com/newcreditrulescom...
families fall apart
It’s a sad but true fact of married life that money is a huge source of trouble. And the 2008 stock market crash and subsequent recession have aggravated the situation. So much so that a recent survey of 828 Canadian couples commissioned by Credit Canada and Capital One Canada found 86% of couples admit they regularly argue about money Til money do us part
1-My rent has dropped 15% since 2007........and is still going down where I live. It should be down by roughly 20% in July 2010 when my lease comes up for renewal. All around me the current comps are $200 less than what I pay now.
2-Compared to 2007, RE dropped in late 2008 by 20%, then suddenly bounced back 10% in the last 6 months of 2009 due to the government lowering the B of C rates to .25% and telling CMHC to write all the mortgage paper that comes their way regardless of credit quality, down payment, and debt service ratios. If you have a pulse, and their fees.....you are approved.
3-The government has also given CMHC an additional 350 BILLION of taxpayers money to support the "bubblette" housing market so they can accept all this SUBPRIME 5% down 35 year amortixation mortgage paper.
I told you before Shakespeare, it is probably best for you to remove the Ben Wall balls from your ass and take the vibrator out of your mouth, so you can use both hands when you type on the keyboard, as it might improve the coherence and quality of your utterly irrational lies being passed of as statements of fact.
4-The REIC started a predatory mass media marketing campaign geared towards the stupidest and most financially and emotionally weak people in our society, the under 30 first time home buyer.......in order to get them off thidelines, since everone else had bought, or was smart enough to sit this one out.
November 6, 2009 4:15 AM
Carioca Canuck said:
"So you have to advertise your blog as "fair and balanced" because....
1-FOX News had a catchy slogan and you were too dumb to make one up.
2-You were lying all along and now is the time to deceive thru a false impression.
Make your pick asshole".
Instead of showing your ignorance by using profanity, perhaps you could point out where you feel this forum has not been fair and balanced?
While I've got your attention, do you still believe the average price for this year will be $313,049 as you predicted? Today, the avg price is $470,839. What would you say to someone who followed the advice you were giving one year ago?
I've noticed on Garth Turner's blog that you didn't curse at him, yet he still called you stupid. - Bob
What a guy, that CC...
Posted at 0415 am. Drunk again, right?
If people saved the difference between renting and buying as we have, they'd be much better off financially than a "homedebter". So I'd say that my advice was very sound. We are certainly happy about the results to date, and the impending higher rates will just add to that. What about all the people you stuffed into overpriced "bubblette" property, how will they feel when rates are 8-10-12% down the road ? I am trying to remember that Ben Affleck line from "Boiler Room"......oh yeah....got it now......."just look at the fucking smile on my face"......
On the subject of price, neither you, nor I, predicted the introduction of government intervention totalling hundreds of billions in both direct cash injections to the marketplace, a reduction of credit standards by CMHC, nor record setting low rates. Had that not happened, I'd probably have been on the money with my price prediction. FWIW, bears do not have to be bailed out by those who are financially more prudent. Bulls do.......
weather they be real estate, gold or widget bulls
they lose their grasp on reality and fail to see whats actually going on around them and they will listen to no one as they are always right
the problem with real estate bulls is that eventually they need to bailed out by the taxpayers as housing effects everyone hence the saying
........................BULLSHIT!!
exreme real estate bulls usually go bankrupt
but they leave the rest of us in massive debt and then its up to us to clean up the mess theyve made of the economy and other peoples lives
Where is the Calgary proof rent are down from 07 or R/E is down $50,000 over the same period.
As usual you are lying.
An ignorant, racist, bully that is a waste of skin.
CC, liar you simply are too ignorant to know the difference.
is it the continually changing massaged and completely private CREBs statistics that you are quoting ?
wheres your proof that rents arent significantly down ?
you sound like a desperate and tired old man who rants at posters on blogs
thats quite sad really
I never said RE was down $50K today, Squidly did, learn to read........however, it was down $90K a few months ago......
;>)
As for rents, I have signed leases for my suite, it has been in the news media everywhere, even Boardwalk said they were cutting rents last year and they are this year as well, and anyone can use the "Wayback Machine" and research Kijiji or Rentfaster to figure that fact out.
I have also never mentioned anything like you said, nor started these verbal fisticuffs, I just responded to your aggressive post.
Next thing I will probably read is in the Sun. You will be written up as "that guy" in the ER who surgically needed something removed from his you where due to excessive stress during typing........
know where.....
We have bubbles being reinflated all over the world today because gov'ts can't accept the alternative. We are in a massive dollar carry-trade bubble right now. RE, ditto.
This won't end well. There is a watershed event that will happen eventually. The lies and accounting fraud coverups cannot continue because losses are deepening, particularly in the CDS and MBS markets.
You will see very soon that the economy we perceive as "real" and prices you view as "market", are nothing more than a joke.
Go ahead... buy RE today. But one needs to always think who the next buyer of your home is going to be and what potential problems may arise. I can say from first hand experience that selling in a difficult market or under adverse economic conditions puts a sting in your craw that you never forget.
Just my $.02.
->
Also, when you have a thousand renters buying a condo or house purely based on current low interest rates, vacancy rates go higher and rents are forced to come down. The new mortgage slaves think that they are getting quite a deal, a house to call their own that is even cheaper than rent. The shock will hit them when rates go higher, because as everyone knows, they have nowhere to go but up.
Again, I do recommend people (specially that Stormy imbecile) to either bring facts in support of affirmations, or speak from personal experience.
The rental market is FLOODED with properties. Over 4,000 apartments for rent on Kijij alone. Add SFHs & Townhouses, and you getthe picture.
RENTS ARE GOING DOWN (at least for now).
(median)
Calgary 2 bedroom apartment:
07/09 - $1200
08/25 - $1150
09/08 - $1150
10/14 - $1100
11/09 - $1100
Calgary SFH
07/09: $1650
08/28: $1600
10/14: $1600
11/09: $1600
Anecdotally, this month I've really noticed a lot of the 'first month free', 'move in incentives' and very flexible term lengths.
Canada's October, 2009 unemployment rates
Just wish all the paper pushers would get out in the real world and see how the working blue collar class are dealing with lay offs, wage and hour cut backs, increasing grocery and utility costs etc.
But then again...who would be interested in that data. as there is no way to profit from it.
The lap dog below writes, “With the exception of Abbotsford, we have the worst unemployment rate in Western Canada.”
News flash; Edmonton up from 7.4 to 7.7 Abbotsford DOWN from 8.9 to 8.0.
Your 'news flash' does not make the quoted statement false, at least as it relates to the article cited, and as long as the definition of western canada = BC/AB.
You might want to review your own critical thinking ability first.
As per the Interactive guide. Western Canada Unemployment rates:
Abbotsford = 8.0
Edmonton = 7.7
Vancouver = 7.3
Calgary = 6.9
Victoria = 6.4
Winnipeg = 5.8
Regina = 5.1
Saskatoon = 4.4
Stock markets rally...
Yet many investors are uneasy. For these people, the market is taking on a "greater fool" feel, meaning that many don't really believe in the investments they are making. They are banking on being able to sell to a "greater fool" later.
Dow Leaps in Skeptics' Rally
The 'greater fool' feel, after a few years, seems to be a quite normal state in the Canadian RE market.
Interesting times we live in, interesting indeed.
-
http://www.edmontonsun.com/money/2009/10/30/115...
Not sure how many will be affected in Canada, but since they have 6000+ employees and thousands more contractors in AB, there probably will be layoffs here, too.
You beat me to it bud.........they made a $3 BILLION profit this year and they are cuttting 10% of their total worldwide workforce......and they won't say how many Canadians are getting the axe yet. I'd wager 75-100 high paying jobs get let go........wonder if they'll all run out and buy a house since they'll have lots of time to do so, being out of work and all that.
The part from the article that really pisses me off about Stelmach and the national Conservatives is that........"Earlier this month, the federal and Alberta governments chipped in a combined $800 million toward a project to reduce carbon emissions from Shell's Athabasca oilsands project at the Scotford upgrader. "........that public money should have come with rock solid job guarantees.
Used car sales guy
Returned your condo keys to the bank in early 80's
Drunk guy
Yeah...
Carioca is on EI...
Or worse: on welfare.
"The value of industrial land in Metro Vancouver decreased by as much 30 per cent in the last year as speculators desperately unloaded land bought near the market's peak into a market with little demand."
Industrial land prices fall in Vancouver
After the stimulus I suspect our economies will be very weak (at best) as credit will start to be pulled and stimulus will end. We are already hearing about credit being pulled all over the US as even those with good credit are having their credit card limits cut in half or more. We will also see taxes go up and services cut back. Edmonton city council is already talking about a 6.5% property tax increase plus a huge reduction in services from Libraries, lawn cutting and mosquito control, etc. etc.
The appetite of people taking on huge mortgage debts will also quickly end as families struggle to pay bills and the job markets remain stagnant at best. The kind of mortgage debt people are still currently taking on here in Canada will be the last group of those who do not understand what sort of debt burden they are getting into. My guess is the next wave of home buyers will have a better understanding of the meaning of the word "value".
Canadian economic growth potential half of historic average: TD Bank
Interesting subject.........credit contraction.
A national automobile leasing company in Canada that almost exclusively was the only one around who handled $100K + vehicles, recently (this Monday actually) closed their doors to funding new customers. If you can't, or don't want to, write the cheque for your new Ferrari, Porsche, or Lamborghini you've got few, if any, leasing choices left.
They currently have 8,000 units out on lease right now and will continue to collect payments on existing contracts obviously, but are no longer open for business and are winding down their consumer leasing operation.
FWIW they are owned by one of the big 5 banks too........so it's not like they don't have access to money.
I too agree that the existing government stimulus you're talking about has to end sooner or later. one way or the other.....and both endings are going to have leave some serious collateral damage in their wake.
Used car sales guy
Returned your condo keys to the bank in early 80's
Drunk guy
Yeah...
Carioca is on EI...
Or worse: on welfare.
http://money.ca.msn.com/savings-debt/slate/arti...
The bottomline in the article is that the stock market is not based on the US economy but by those good ole values of speculation, greed and spending other people's money like there's no tomorrow.
The author points to the following factors creating an illusion on the stock markets: (1) low US dollar means real stock market value is low (2) better than expected or less than negative corporate earnings are a reflection of the cost-cutting measures including layoffs (3) low interest rates driving investors to stocks for a better return (4) small businesses which employ about half of Americans are still hammered and they are not on the big cap stock market (5) euphoria that recession didn't equate to depression (6) low interest rates favour finance stocks of lenders with 4 major players accounting for 20% of the market (7) govt bailouts to big business (8) high frequency aka speculative trading (9) mutual funds which are funded by Main Street continue to lag badly just like Main Street.
I say another bubble in the making!!
All the goods exchanged, houses built, vacations taken during the boom were supplied by people working real jobs.
Most debt taken on has a depositor on the other side of the trade. The exception would be simply money printing I'm not sure how much has taken place so far. I believe that the gap between the returns on labour and speculation has contributed to higher overall debt burdens on wage earners trying to maintain their standard of living. Its not the result of wage earners becoming less productive.
If only someone could determine a reasonable path to wealth distribution everything would be cool again. ;-)
When the US was talking bank nationalization back in March I think Obama really dropped the ball. If everyone is going to accuse him of being radical and a socialist he may as well taken advantage of it. Regardless of you politics it would have been a sight to see the military seize wall street and pull off an immediate forced auction of all assets. Fine art, office furniture, sports cars. Not that it would be the right thing but it would sure set the tone.
Real money does not exist in our society - it is almost all debt and the way central bankers see their way out of this crisis is to devalue all debt (and concurrently the little bit o money that backs it) so that debtors (the majority) are saved and savers (the minority) get screwed.
$100 deposit
$90 loan (10% reserve)
...
$90 deposit
$81 loan
... etc
I'm not sure where the initial $100 comes from. Can central banks can create new money as part of normal operations without new debt.
In the fractional banking system the banks do create money in the process of lending. Here's how it works based on your example above:
- A person sells tulip bulb for $100 cash, runs to the bank and deposits it.
- The bank now has $100 in its reserve so it loans out $90 to another person so they can buy a tulip bulb.
- The $90 of loan gets then deposited back into the bank by the tulip bulb seller.
- Thus as far as the bank is concerned it got another $90 deposited (never mind that this $90 dollars are part of the original $100) so it can loan out another $81 to people to buy more tulip bulbs.
- This process continues until at the end the bank loans out total of $900 for the purchase of the tulip bulbs. And this is all from the original $100 cash (multiplier of 9).
Notice the bank has the required 10% reserve in the original $100 cash deposited - $900 in loans and $100 in cash reserves for the total of $1000. Yet the $900 dollars in loans did not exist before the process started and was created by the bank. The bank has never had the money that it gave out in loans for the tulip bulbs. It created the money based on the original $100 and the 10% rule of the fractional banking system. This whole thing is based on the assumption that whoever borrowed the money will eventually create the value for them and pay back with interest. In other words it’s a case of the future value being moved to the present and the borrower has to pay for that in interest.
Of course the original $100 dollars has been printed by the government and it used to be backed by a precious metal, but now it is just an agreed upon arbitrary value that depends on many factors including the country's economic strength.
In the above example, if everyone defaulted on the loans then we would be short 9 times the money originally there as the future money has been already spent on tulip bulbs, but now the borrowers refuse to create the value for it.
BTW, according to Wikipedia and Gilligan's Corner Canada has no reserve requirements for the banks thus Canadian banks can theoretically lend as much as they please without the 9 times multiplier barrier. Now that could cause the price of tulip bulbs to skyrocket...
-
This increasing of the monetary base also has the effect of lowering short term interest rates because the extra demand for bonds will drive up their prices (and thus lowering the interest rate). When the Bank of Canada announces the interest rate, it is not really setting the rate but indicating that it will be going to the open market to buy or sell bonds so that the desired interest rate will result.
For commercial banks this is really a great gig. Not only can they borrow from the central for next to nothing or pay depositers next to nothing in interest but then they can turn around and loan out 10-20 times that amount at higher rates. So if a bank pays a depositer 2% on a $100 deposit it costs the bank $2 per year. But then they turn around and lend out $900 (using Bad´s example) at say 5%, earning them $45 in income for a nice $43 dollar profit. Now you know how they can afford those bonuses.
I am off to Rio de Janeiro again next month until January.
They lure you into their offices to give you their sales pitch and get offended when I laugh at the prices. I am going to pay HOW much for the burden of paying how many taxes and fees in a place where the electricity can not operate for more than 12 hours straight? lol
Enjoy Brasil. Say hi to my girlfriend. Cheers.
Speculative recovery sows seeds of an even greater economic crash
The commie creep below [jsan] links to a New York site called “World Socialist Web Site”. As if the goof has something to contribute to intelligent conversation. Since when is ignorance a valid point of view?
In economics as in all aspects of life, it is survival of the fittest, and in economics that means simply “get the fucking money”
It seems apparent to me by your blowing a gasket based on one website link that not only do you not understand the meaning of the word "Free Speech", you don't believe in it either.
http://www.philstockworld.com/2009/11/11/goldma...
"Goldman Sachs, Morgan Stanley, BP, TOT, Shell, DB and Societe General founded the Intercontinental Exchange in 2000. ICE is an online commodities and futures marketplace. It is outside the US and operates free from the constraints of US laws. The exchange was set up to facilitate "dark pool" trading in the commodities markets. Billions of dollars are being placed on oil futures contracts at the ICE and the beauty of this scam is that they NEVER take delivery, per se. They just ratchet up the price with leveraged speculation using your TARP money. This year alone they ratcheted up the global cost of oil from $40 to $80 per barrel."
One just has to love this expression:
P.S. It’s always a good time to buy a home, given the right reason!
Working with investors and astute buyers
The remaining question is: what the right reason could be?
This reminds me of an old joke. Let me apply it to the real estate here:
A guy I met tells me, “I have invested in RE and in a few years it made me a millionaire.”
“Wow! That’s great!” I go.
“Not really,” he says, “I was a billionaire before that.”
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The next day the broads are hanging on BAD again and not noticing the Jasan with the new Speedo. On the way home he again asks BAD what his problem with the girls is.
BAD says, “Look get yourself a potato and put it in your Speedo”.
The next day still no luck, the fluff are staying even further away from him. He can’t Stand it anymore and asks BAD what to do next.
BAD says, “Move the potato from the back to the front”.
Calgary RE market:
Some perpetrator will get a mortgage, keep the money, and let the banks go after the straw buyer once the payments stop.
Others fraudulently inflate the house price a few months later and find another straw buyer to purchase it at the higher price and pocket the increase.
“Sometimes it is flipped several times between different straw buyers and eventually they will be sold to innocent parties out there in the public,” said Ruzycki.
Downturn helps unmask mortgage fraud in Alberta
Buyers beware?
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only difference is, here in canada the industries are able to hide the truth better.
It seems that it is different here after all...
Canadians are slaves to credit: survey
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What does the FHA think it is doing?
CMHC requires a 620 (prime) credit score and 5% down. The 5% can come from RRSPs only for first time buyers. Based on higher down payment and credit score requirements this article illustrates how it is different here ;-)
When I bought my house 10 years ago, I did not go through CMHC, had a very good secure job, a 40% down payment and an impeccable credit history. They still went through my application with a fine tooth comb and put a much lower ceiling on the amount that I could borrow compared to what I could borrow today based on the "how much can you borrow" calculators found on most large bank websites and the same criteria.
If CMHC borrowers were not all "subprime" in one aspect or another, the banks would happily write their mortgages without the government guarantees.
Ergo......CMHC is nothing more than a subprime underwriter.....errrr.....I meant you and I, the Canadian taxpayer.
You can even get a CMHC mortgage to buy your bubble priced house with ZERO down.....it is called a "cash back" mortgage. Put 5% down, get CMHC approved, and you get your 5% back.
Here you go...............sign up today !!!
From their posted rate they show 5% cash back 5-year fixed at 5.78%. Their posted discount 5-year rate is 4.53%. So without any further discounts you are paying an extra 1.25% a year which works out to over 5%. I really question how many people are doing this since its such a bad deal.
It's the principle (or should that be principal.....heh) that matters........and you are right, it is a dumb idea for sure.
The two brooms were hanging in the closet and after a while, they got to know each other so well, they decided to get married.
One broom was, of course, the bride broom, the other the groom broom.
The bride broom looked very beautiful in her white dress. The groom broom was his usual doltish in his tuxedo. The wedding was lovely.
After the wedding, at the wedding dinner, the bride-broom leaned over and said to CC the groom-broom, "I think I am going to have a little whisk broom!!!"
"IMPOSSIBLE !!" said CC ."WE HAVEN'T EVEN SWEPT TOGETHER!" Sounds to me like you have been sweeping around.
So, tell me again you Commie rental smegma how much money you are saving now.
I certainly hope you are all wallowing in your richly deserving poverty. Were you ever wrong!
I think I will up the rent in January by 15%
Tra la la.
China: Low US interest rates threaten recovery
Is the Canadian housing market dangerously over-valued?
It doesn't take a rocket scientist to realize that if the only thing driving the housing market is historically rock bottom, heavily manipulated interest rates, there are going to be major shock waves when those rates are forced to go up.
"An apocalyptic real estate bubble is striking fear in the hearts of many economists."
When did this countries "economists"........and I use that word real losely, overpaid spinmeisters would be more appropriate, suddenly develop a financial conscience for "alluding to" let alone reporting, the obvious truth ?
MickeyMinniePlutoHueyLouieDeweyDonaldGoofy
When asked why such a big password, this flaming red commie said that it had to be at least eight characters long.
National MLS home sales will likely exceed forecasts for 2009 and 2010 after a monthly record was set in October, the Canadian Real Estate Association says.
And get a load of this; is slime squidly on the lose again;
Calgary police probe anti-Semitic vandalism
Are you rental losers having fun yet wallowing in your poverty? Come on you can tell us.
What, you commies still think Canadian R/E is going to be free.
Tell us what it is like to be utterly wrong all the time.
Is it embarrassing?
The Canadian Real Estate association aka Real Estate Cheerleading Association will once again be crawling back under their rock in the not too distant future as the Bubble inevitably pops, next time much more violently.
You cannot manipulate and hold off the inevitable forever. The bottom line is, and you don't even have to be very smart to understand this, is that the current price levels are not sustainable at higher interest rates....PERIOD.
Yes you are an embarassment.
They all paid their 100 dollars for their "Get Rich in Real Estate" mail order course and are now snapping up these "fantastic bargains" ( I cannot say this with a straight face).
How much do you want to bet that those "For Rent" signs don't come down, especially as every single condo and every single apartment in this city has a "Vacancy" sign in front of the building. I am praying for those higher Interest rates. I hope the economy goes through the roof because the Interest rates will follow through the roof. Unfortunately, I believe it has a much greater chance of crashing for the second time, this time much worse.
http://www.mls.ca/PropertyDetails.aspx?Property...
We went to look, it is in the LeBeau in Mission Calgary. She told us she sold 8 condos without even trying, this was in November, remember November 2008? You get the picture. She proceeded to tell us how great of a realtor she was and how the builders of this building were top quality.
Anyway, the price at the time was 1.2million, now at 814k one year later still for sale. She said these condo developers were very smart people, oh, and ya, she is realllly smart too. Back to the quality thing. I found these postings on the developer:
http://forum.skyscraperpage.com/archive/index.p...
and craigslist this year
http://calgary.en.craigslist.ca/rnr/1322391263....
I had printed this out in PDF but of course cannot find it. Looks like it expired on Craigslist but the post was about the LeBeau developer. Inspections did not pass on parts of the building apparently and now the new "investors" were hit with a special assessment already and the condo association is broke due to poor management.
Now this same super duper realtor is peddling the LaRive, same builder, same poor quality, and soon to be "investors" to be hit with a special assessment.
1.2MM to 814k??? LOL......
Take a look at the Interactive Provincial averages from 2008 to 2009 for each Province in Canada. They are all very healthy rebounds with the exception of Alberta.
October, 2009 residential home prices
Stocks Overvalued, Recession Will Return: Meredith Whitney
There were 50,182,850 deaths recorded worldwide in 300 days of counting. (More or less)
Only 5,850 were from swine flu.
That compares to 1,649,779 for diarrhea, 2,734,371 for Hiv/Aids and over 14 million for cardiovascular disease.
You are only slightly more likely to die from Swine flu than you are from Leprosy (5,440 deaths).
Fear fabrication is a very useful control mechanism for creating a previously nonexistent demand.
The GDP data especially is what all people view as the main statistic when referring to economic growth. The leaders of all of the countries promoting stimulus knew they had to make these numbers look better so that they could get people to take advantage of the monetary policy put into effect with 0% interest.
The 2 models that governments use to encourage economic growth are fiscal policy (Keynesian Model - http://en.wikipedia.org/wiki/Keynesian_economics). Governments borrowing money to create artificial demand to try and spur economic activity. Problem is some sectors should die naturally and governments are choosing which ones to keep. If they made the wrong choice they're done.
The other policy is monetary. Changing interest rates and adding to the money supply aka quantitative easing. (http://en.wikipedia.org/wiki/Monetary_policy)
Typically in history, you were of one viewpoint or the other. World governments have done BOTH here now. Of course the market is going to rebound with that kind of money put in, in the short-term.
The BIG question is, how long can they do this for? Certainly not forever. People can only be manipulated into thinking a certain way for so long until the other side of the argument gains the majority and everything goes back down again.
In the great depression there was a "suckers rally" ....see this article (http://etfguide.com/nl_more.php?ID=131)
"But wait, didn't the exact same thing happen during the Great Depression? After the initial 48% decline in the Dow, stocks rallied nearly 50% before collapsing. This rally from November 1929 to April 1930 was the mother of all sucker rallies. "
This leads me to believe that because of the severity of this crisis we are just seeing the great depression......just magnified to a larger degree. This time the world economy is INFINITELY bigger with just as many relying on the USA
So you are saying that "Fear fabrication is a very useful control mechanism for creating a previously nonexistent demand" .
like the need to own one or more 500k houses on a average income in Alberta based on the fear that real estate will rise forever so "buy now or else you will be priced out forever" or "we are running out of land"?
The bubbles, toils and troubles that nearly wrecked the financial system should've been obvious to the policymaking numbskulls whose monetary tricks made matters worse.
"Arrogant and incapable of learning."
http://money.ca.msn.com/investing/bill-fleckens...
The wife and I were talking about this exact topic last night.
When things get slowe, the easiest way to boost profits is to sack employees because they are usually the greatest expense to a companies bottom line.
Redistribute the work load and no one will complain.
When things turn around, do not rehire, doll out small raises for productivity to the employees if they hit their targets, and make even more money without increasing your expenses expotentially.
As a health care manager she has had to do this exact same thing in the past, and in my past I have had to it as well. These things go thru cycles about every 20 years..........I expect the 20-30 somethings in Alberta will suffer dramatically as a result.
It also seems that the newest trend and current "marketing plan" is for realtors not to use "FOR SALE" signs as much as they did in the past........interesting 'dat.
Plague........
I don't know if I told you about my impressions of "LaRive" when I was over there last month, but it was a really crappy complex IMHO. The newly completed show suite on the ground floor had cracks in the wall seams, visible drywall tape under the paint, crooked floors, poorly fastened baseboards, cheap cabinets, even worse bathroom fixtures and finishing, really low end stuff IMHO, and an overall feeling of what can best best described as "cheapness" in the quality of it's construction.
I watched the place get built from the hole being dug to the final shingle being nailed down, and am amazed at what they are allowed to pass off as construction nowadays.
Your best post ever.
Good linear construction of your point of view.
However, you are forgetting the third governmental economic control or intervention “command economics” the communists system that has historically proven itself a dismal failure.
The us avoided a revolution among the peons in the recent implementation of this communistic economic- Command - system by manipulations of a gullible and essentially ignorant population [as on this blog] by pandering unsubstantiated information [swine flu ]to the ignorant resulting in paralyzing fear of said peons.
That aside.....let's say that the stimulus and monetary policy has worked and we do start to see real growth, as soon as interest rates start to creep up, the same people that can be convinced that swine flu will kill them are the same ones that believe that they can afford a $450,000 mortgage with a $45,000/yr income. Clearly they have a variable mortgage because its "cheaper", but this people dont think past tomorrow. When/if the rates creep up (even if its not hyperinflation like it should be) then these people are going to start selling off their houses (if they are able to). When the supply of idiots selling their houses they can't afford outweighs the demand of people wanting to buy, this could get ugly again. If you see it different, let me know?
To add to the gloomy unemployment picture there is the incentive of the increased EI benefits rolled out in the USA and Canada. With laid off workers getting more benefits for longer periods there is absolutely no incentive for companies to start hiring again.
Those laid off workers are being paid by the govt for losing their jobs, the companies are getting bailout money to spend and the remaining employees will just sit the hell there, shut the f*** up and take whatever is shoved up their ass because they are afraid of losing their jobs.
The problem is that the any profits gained will actually go towards hoarding cash, paying debt, awarding bonuses to upper level mgmt, not taking risks and not towards growth. That does not augur well for laid off workers.
Meanwhile:
Despite warnings from some bankers that consumers should be prudent when taking on household debt, Canadians are gaining a healthier appetite for risk and taking on longer-term mortgages.
A survey released Monday by the Canadian Association of Accredited Mortgage Professionals shows 18 per cent of mortgages are long-term, compared with 16 per cent a year earlier and 9 per cent in 2007.
Mortgage debt soars in Canada
Everything’s fine, just be prudent, eh?
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"Healthier" as in eating too much McDonalds food or deep fried KFC thats good for you?
Mike
http://www.realtor.ca/propertyDetails.aspx?prop...
Sold for $1m 14 months ago.
Who says Calgary RE is going up?
Mike
There is obviously something VERY wrong with the place. They dont even have pics of the inside. The fact that this is still on the market and can be found on MLS is testament to whatever it is that is VERY wrong with that place. The deal is too good to be true...just think about it... the financial and realtor scum would have their hands all over that place FIRST if it were actually a "good deal".
Brings me back to a home i saw once in West Springs. Was at least 200k below value... but we called about it and found out it was a former marijuana grow op. That basically destroys everything and likely there is mould everywhere.
Horrible to backout on 17th ave from the garage as well.
Just goes to show how easy it is to lose $300,000 on a market that, according to CREB, is going up.
Mike
Why would developers buy an almost new $1 million dollar house for its land when it backs up to a busy street?
Like a lot of what you say it just doesn't add up.
17th Ave is not as busy as 14th street and it's the most trendy street in Calgary IMO.
http://www.pbs.org/wgbh/pages/frontline/closeto...
Just wanted to say thanks for the link to the PBS video above. I watched the entire 55 min. and boy! what a genuine, un-sugar-coated reality check. Excerpts of life. Simple and powerful. Looking and listening to all those real people who found themselves in distress, almost taken by surprise, it struck me that they disoriented and stressed, but mostly humble. I couldn’t stop thinking that maybe, just maybe some people should go through that just to become more humble.
Stormy is one of them.
And the other trolls/realtrolls, they know themselves..
Just the ones who don’t show signs of kindness, compassion, respect for others. The ones who have no scruples when looking after themselves……………
Stormy is one of them.
And the other trolls/realtrolls, they know themselves..
Just the ones who don’t show signs of kindness, compassion, respect for others. The ones who have no scruples when looking after themselves
great point Atzi, and I like the "realtrolls" thing, do you mind if I borrow that from you some times?
My mid month rent checks have cleared, don’t you just love money. Thinking of buying more rental dumps.
Very dismal news, CBC reports today R/E sales and prices are way up in all Canadian jurisdictions.
I hear the newfound poverty has CC mailbox full of pre-declined credit cards. Something about lying.
Have you heard the us economy is so ghastly Hot Wheels and Matchbox stocks are trading higher than GM.
For me (a renter), I have enjoyed the private maid and gardener for the past year in my rental contract and using the fully new furnished 4bd house as well (furnished by my landlord via a designer) so I don't even have to wear out my own stuff!
We saves so much renting vs owning that spending just 10% of that we are able to visit Toronto right now (as I type) and in 2 weeks are flying to Germany for the Christmas Markets in Berlin, not bad considering we just came back from Paris 3 months ago. :)
SP, haven't you heard, rental vacancy is still going up and up 400% vs 2 years ago?
So, no loser renters on this blog.
We hired one 6 months ago.......best thing we ever did.....I just don't know what to do with all this disposable income we have as renters....daayyyuuummmm, I must be richer than I think.....heh.
Carioca is on EI but hires a maid????
I smell a scammer here...
Question: Why are realtards such fuckless gits ?
Sometimes it pays to be a renter. :)
Speaking of which, you have a "buyers market, a sellers market" why isn't there a "renters market"?
"Another key point is that existing home sales are largely irrelevant for the economy. This is an important point to remember next week when the NAR announces that existing home sales surged to 5.8 million units or so in October (seasonally adjusted annual rate). Some reporters and analysts will jump on the existing home sales report as evidence of a housing recovery. Others will point to it as showing that the first-time home buyer tax credit is helping the economy.
Both points are wrong.
The only contribution from existing home sales to the economy are some commissions and fees. That is good news for real estate agents and mortgage brokers, but not for the overall economy."
Existing home sales without new residential construction no new investment in the market which means no new jobs are created to build the new homes which means we are still stuck in this mess despite a RE boom. What is really happening is that the existing inventory of homes are being moved around by the existing pool of buyers. The real cost here is the new mountains of debt acquired by buyers. Until new homes are built in large numbers again the RE mini boom we are seeing has little effect on the main driver of the economy; employment.
Inventory in SHFs continues to decline because nobody wants to build new homes anymore and speculation is increasing where some specs are buying and hoarding properties again. But for those who moved out of apartments to cash in on low mortgage rates and the home buyer's credit they are contributing to rising rental vacancy rates. Declining inventory and continuing low interest rates may drive some builders back into the market but not until next spring by which time we may see another correction when ARMs are reset and when EI runs out for many Canadians leaving them staring at foreclosure. EI is keeping many homeowners alive right now.
Overall debt is still far too high in almost all rich economies as a share of GDP (350pc in the US), whether public or private. It must be reduced by the hard slog of "deleveraging", for years.
"As yet, nobody can say with any certainty whether we have in fact escaped the prospect of a global economic collapse," said the 68-page report, headed by asset chief Daniel Fermon. It is an exploration of the dangers, not a forecast.
Under the French bank's "Bear Case" scenario (the gloomiest of three possible outcomes), the dollar would slide further and global equities would retest the March lows. Property prices would tumble again. Oil would fall back to $50 in 2010.
I have been protecting my nominal assets for the last 24 months and am comfortable with my positions. Seems like France's biggest bank has no problem with this report going public......global economic collapse, how apropos....we already had it IMHO, but Barry Obailout and Jim Flatass in Ottawa robbed money from you guys to keep it from finishing us off "today"........but now that we are worse off, you must remember, tomorrow always comes.
What's that ? You wanna buy some real estate ? I'd rather carry $100K at 15% than $300K at 5%........
The Mortgage Bankers Association said fixed-rate home loans made to people with good credit accounted for nearly 33 per cent of new foreclosures last quarter. That compares with just 21 per cent a year ago, when high-risk loans made during the housing boom were the main reason for default.
At the same time, the proportion of homeowners with a mortgage who were either behind on their payments or in foreclosure hit a record-high for the ninth straight quarter."
http://money.ca.msn.com/investing/news/business...
http://news.yahoo.com/s/ap/20091119/ap_on_bi_ge...
"(...) The latest evidence was a report Thursday that a rising proportion of fixed-rate home loans made to people with good credit are sinking into foreclosure. That's a shift from last year, when riskier subprime loans drove the housing crisis .(...)"
If Stevie Harper's bunch of fact-twisting acolytes wouldn’t cover up so much of the real situation in this country (I’m talking about R/E, jobless numbers, debt-taking, CHMC socialist, or uber-capitalist protection – meaning that bank will always fall on their feet), we would not have such a cheerio crowd these days, praising the vitality of a otherwise dead corpse.
It is obvious to me that all the efforts went in the direction of “holding the bottom”.
If you went into a bank (like I did) and ask them to present you the list of foreclosures that they own, for to offer to put an offer on one, THEY WON’T DO IT. They told me, they are using Realtors to sell the foreclosures, and at price which won’t be a bargain.
In the meantime, the Rich get Richer, DESPITE THE DOWNTURN!:
http://ca.news.finance.yahoo.com/s/19112009/2/b...
It is like a snowball going downhill. More unemployed means less tax and revenue to state and Federal coffers and more government expenditures in the way of Unemployment and Social support programs meaning more debt, less spending, more unemployed meaning even more debt, even less spending even more unemployed etc. etc. It could become a runaway train.
Money is such a wonderful thing; the only purchase not accessible is Poverty.
Also in the Post today is a comment by Jonathan Chevreau [You just know this guy is limp wristed by calling himself “Jonathan”] where he recommends buying gold as an inflation hedge. In my experience, this guy is always wrong. Take a gamble, short gold. India must have most of the gold over there by now. A price correction is in the offing.
Remember the inflation rule of thumb: divide the annual inflation rate into 72 for an approximation of years to a 50% loss of cash value or another view, a doubling of prices.
Did I tell the Inuvik flying trip this summer?
Of course, Sophia is pissed with me now as per course; however, she was a great nightly comfort to me on this trip.
The Bathurst caribou herd has collapse 85%. The western Eskimos’ may be in a food crisis as in the 1950 when a similar event required massive Canadian aid.
Instead of supporting corrupt ruling classes in Afghanistan, Let us help Canadians.
Well, that offsets that I'm left handed (-6 years). haha.
Mike
"In the first six months (of 2009), we saw well over 60 per cent of our applications being for variable-rate mortgages, and in particular in our case five-year variable-rate mortgages," Beaudry said.
"Towards the latter part of the summer, until now, the trend has reversed to where we're seeing about 70 to 80 per cent of our applications going for five-year fixed-rate mortgages."
Turner agreed, saying 60 to 70 per cent of BMO's customers were opting for variable-rate mortgages in the past, but lately "there's been a slight shift to fixed."
Are these predictions going to happen? It's anyone's guess. Most agree that rates are going up, face the facts, they can't really go any lower the question is when? In 6 months, 1 year, 2 years???? who knows. Next year at this time we could be at 10% or sitting at the same level. Flip a coin.
The real danger is if rates start taking off, by the time you decide to lock in, that locked in rate could be enough to put allot of people into foreclosure. I can see people not locking in because their floating mortgage is still somewhat manageable but the locked has gone too high. The problem is, that floating rate could keep climbing and climbing and by that time it would be from a budget point of view too late (expensive) to lock in and all you could do is hang on and pray that the floating rate drops. There is a good chance it doesn't and just keeps climbing and climbing all of the way to bankruptcy.
http://www.usnews.com/articles/opinion/mzuckerm...
with purchasing power going down and unemployment running wild inflation is the least of our problems. Since the US, our biggest market has its economy feeding in upon itself in a chase to the bottom it puts all of us in a bad position. Without manufacturing as a tool to spur growth we are looking at an ugly 2010. Major government intervention and more debt are going to leave a heck of a question mark to where this is going.
Sad ...
http://www.theglobeandmail.com/report-on-busine...
a view at the cuts down south
http://www.startribune.com/local/70392967.html?...
http://www.latimes.com/news/local/la-me-pay-cut...
make me wonder how far this is going to go before people start lighting torches and grabbing pitchforks. Probably 22% unemployment and 10% rates could start the ball rolling.
This is probably why so many people preach the importance of living within your means and of trying to have some emergency savings to fall back on. Nobody listens, this society is obsessed with living the good life and living paycheck to paycheck with nothing to sustain themselves during hard economic times. Something we have not seen probably since the 70's and even those years were not very hard.
Housing is an excellent example of this. Not that long ago people would never have gone as deep into mortgage debt as they are going today. Especially based almost entirely on rock bottom interest rates which will be going higher in the future. It is reckless and foolish.
You are right on the button with that one. I've been preaching that to my friends, family and anyone who would listen. A few have taken the advice and I don't have to worry about them, the vast majority think "I don't need to, I won't have to worry".
Mike
http://www.realtor.ca/propertyDetails.aspx?prop...
Remember the home I reported on a month ago for $899k in West Dover? Well, they just dropped the price to $824k, I think they need they need to go waaaay lower for the area. Their neighbour just listed as well for $599k. http://www.realtor.ca/propertyDetails.aspx?prop...
Mike
Hasn't that Dover turd been for sale forever ? We've talked about it here before some months ago IIRC.
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The Bank of Canada wants consumers to remember that interest rates won't stay at historic lows forever. In its semi-annual review of the financial system today, the central bank noted that market conditions and the economy in general have improved, but that rising household debt is now the biggest risk.
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hmmmm. are they going to anything about this or is this just hot air coming out???