US economic gloom round-up
This is an easy one, I’ll just link to the top 4 headline stories on MSNBC:
Record drop in house price index
U.S. home prices dropped 8.9 percent in the final quarter of 2007 compared with a year ago, Standard & Poor’s said Tuesday, the steepest decline in the 20-year history of its housing index.
Foreclosures up 57 percent in 2007
The worsening situation came despite ongoing efforts by lenders to help borrowers manage their payments by modifying loan terms, working out long-term repayment plans and other actions
Wholesale inflation rate jumps up in January
The January inflation surge left wholesale prices rising by 7.5 percent over the past 12 months, the fastest pace in more than 26 years.
Consumer Confidence weakens significantly
The index measures how consumers feel about the economy. It has been weakening since July, suggesting that wary consumers may retrench financially, which could fatigue the economy further.
Does any of this matter to us in Canada? The IMF seems to think so.
More vital than Canada’s massive trade ties, financial markets have become the primary conduit for the faltering U.S. economy to infect its northern neighbour. And that’s why Canada can’t easily escape the economic headwinds now buffeting the United States, the report concluded.
Canada-U.S. trade represents 49 per cent of GDP, up from 37 per cent in 1988. But the value of cross-border financial holdings, meanwhile has shot up to 90 per cent of GDP from 53 per cent before the trade pact.
Meanwhile Bank of Canada Senior Deputy Governor Paul Jenkins has come out as skeptical about ‘decoupling’ - the theory that our economy can detach itself from the US economy, our largest trading partner.
“Decoupling doesn’t really do it for me,” Jenkins told the House of Commons’ Industry Committee today in Ottawa while taking questions about the strength of the Canadian dollar. The word “suggests that there’s only one force out there or two and we really need to look at all of those,” he said.
If all this gloom and doom has you feeling down just remember: its always darkest before the dawn, every cloud has a silver lining and you can re-arrange the letters in ‘Stagflation’ to spell ‘A Tango Lifts’!
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February 26th, 2008 at 7:34 pm
A question: to any recent buyers out there. Could you please indicate to me whatever rational reasons led you to buy right now? I am curious to understand, honest.
February 26th, 2008 at 8:02 pm
No, they didn’t drop 8.9% “in the final quarter of 2007″. And what’s with “compared with a year ago”? A year ago is Feb 26, 2007. This sentence makes no sense at all.
They dropped 8.9% over all of 2007.
Take a look
You don’t even have to look up the numbers to see that this sentence doesn’t make sense. It’s like saying “my CIBC shares dropped 10% in the final quarter of 2007 compared to a year ago”. Huh?
February 26th, 2008 at 8:04 pm
pressure from a spousal unit is a factor
also this is a great post!
concise and thorough
February 26th, 2008 at 8:56 pm
js
February 26th, 2008 at 9:51 pm
http://financialserv.edgeboss.net/wmedi … 022608.wvx
February 26th, 2008 at 10:06 pm
February 27th, 2008 at 6:55 am
February 27th, 2008 at 9:51 am
Time:When city is packed it is always best time
Age:After 35 year of age this is very difficult decision unless some one got big trunk of money.
Income:when income support to buy our own place what we need is a monthly payment and some money for food and entertainment all this three part can’t be transfer to just one.
Stability:there is nothing else can provide us more stability other than our own fridge own oven,microwave,tv, sofa,bed and our own beautiful unit,our own home.
Confidence:Once we buy our own place means we are able to achieve our basic necessity of human life those are house,cloths and food.
Desire:when we know we have to live our life in this city forever and we have ability from formation of those reasons above then just do it.
Family:our own place is good for our childrens,no fear to loose our friends ,family and neighbour hood.
When we reach up to here no more fuss just beautiful life is above to begun rest is a history start of the new day.
Special:”our own home is a wonderful place in the universe”
So I am in for the day are you?
February 27th, 2008 at 9:59 am
Confidence:Once we buy our own place means we are able to achieve our basic necessity of human life those are house,cloths and food.
Desire:when we know we have to live our life in this city forever and we have ability from formation of those reasons above then just do it.
Family:our own place is good for our childrens,no fear to loose our friends ,family and neighbour hood.
When we reach up to here no more fuss just beautiful life is above to begun rest is a history start of the new day.
Special:”our own home is a wonderful place in the universe”
Rennie marketing regurgitated
February 27th, 2008 at 10:04 am
February 27th, 2008 at 10:06 am
February 27th, 2008 at 10:08 am
February 27th, 2008 at 10:15 am
February 27th, 2008 at 10:53 am
It’s such a remarkable ignorance to think that somehow we’ll seperate from the influence of our biggest trade partner at just the right time. The government acknowledged that with yesterdays budget which expects more slowing and even then some have complained that it doesnt do enough.
http://www.theglobeandmail.com/servlet/ … budget2008
February 27th, 2008 at 11:58 am
February 27th, 2008 at 12:33 pm
1) the US is the world’s foremost consumer of everything.
2) They are losing their appetite for “stuff” (local housing, cars etc)
3) We are their biggest trading partners, NOT China. WE sell them BC lumber for their homes, and cars made in Ontario
4) Even the cheap crap they buy from China and India may be made in part or whole from our “commodities”
5) The world holds a huge number of US denominated debt and assets. As the USD falls those assets drop in value, reducing those countries’ total ability to purchase our “stuff”
So no I would guess we’re not in great shape.
And KRRRRISH,
the things that is better then owing “stuff” right now is having money in the bank. When the recession hits and you lose your job (and with people buying less “stuff”, there’s less “stuff” to move around, so get ready), and all those construction workers etc put their overvalued assets up for sale only to discover it isn’t as easy as they thought to make a cool 100K in the market, you’re going to learn a valuable lesson.
But that’s ok, I’ll flip you a quarter when I see you on the sreet. Maybe you can sell a kidney or something to make the mortgage payment….
February 27th, 2008 at 1:24 pm
There are also vacant units for rent in there for $3k-4k that no world class renters want to pay for either.
Now why would all these wisemans choose not to “buy our own place what we need is a monthly payment and some money for food and entertainment”
Does this mean no one wants to spend over $6,000 a month to own a 1050 sq ft unit on a busy street in the west end? Where are these manual labourers who’re making $240,000 like Krissh and Tom Vu who want to be world class and ” Desire:when we know we have to live our life in this city forever”
Forever or until the warehouse that Krissh works in lays him off and he ends up standing in line at Labour Ready, hoping to make $10 an hour to shovel dirt in the rain.
Go Krissh go!
Please stick around as the market runs out of buyers and the onslaught of new units hit the market.
Bill Eden figured 95% of the Sophia buyers were speculators.
A wiseman told me that 75% of downtown units were purchased by speculators.
This means krissh and dosh better hurry up and start buying because no one else is.
“When we reach up to here no more fuss just beautiful life is above to begun rest is a history start of the new day.”
February 27th, 2008 at 2:52 pm
Pathetic and desperate( aside from boring).
And he wanted to charge?
February 27th, 2008 at 5:20 pm
Check out Nouriel Roubini’s testimony to Congress yesterday:
http://www.house.gov/apps/list/hearing/ … 022608.pdf
February 27th, 2008 at 5:42 pm
But the Fed will be hamstrung, he said: “At some point the Fed needs to worry that an aggressive fed funds easing will lead to a disorderly fall of the U.S. dollar, to foreign private investors pulling the plug on the financing of still large U.S. external deficits and to higher imported inflation. Second, monetary policy is relatively ineffective in stimulating the economy as: there is a glut of housing, consumer durables, automobiles and it will take years to clear that glut.”
http://blogs.wsj.com/economics/2008/02/ … ggressive/
February 27th, 2008 at 5:50 pm
Unfortunately ’stagflation’ also rearranges into ‘got anal fits’!
February 27th, 2008 at 7:20 pm
http://tinyurl.com/36vzmn
Scrambling to find a bottom, the U.S. real estate market is falling further and further in most areas of the country. Home prices nationally will deflate an average of more than 8% in 2008, according to the new Housing Predictor forecast.
February 27th, 2008 at 8:13 pm
My guess is that their hoped-for business model is to issue sensational press releases thereby attracting traffic to their website, and then rake in ad revenue.
February 27th, 2008 at 8:45 pm
bcubbins: c’mon, you don’t expect the same level of unbiased science based facts and figures you would get from the real estate board and CMHC?
February 27th, 2008 at 8:48 pm
Laguna Parkside-1925 Alberni is on sale buy developers realtor- on current market prices,if the go down further than that still their is big chunk of profit than the presale but they can not reduce the price,just to remind you few unit in any projects are hard to sell because of
floor#,sq.ft.direction,views etc.
I like your comment tough atleast put my head back to where it belongs.
SONIKA,
You don’t know the economy of the world right?Do you know who is depend on whom? anyway this world is affordable because of China and India. we get cheap stuff because of labour cost in their countries are cheap,lots of people in the world can fill their tummy on low cost and decorate their homes with needy items.
Special:China and India can produce 95% of their necessities they are depend on the world for only five per-cent.
If you turn the table around 95% people can not afford to buy our stuff because of labour cost in westren and european countries.-Lesson for the quarter you are throwing.
February 27th, 2008 at 10:01 pm
OFHEO is based on mortgages handled by Fannie Mae and Freddie Mac, while Case-Shiller uses publicly recorded data on all home sales in selected communities.
http://www.econbrowser.com/archives/200 … es_fa.html
Dunno, bcubbins, 9.8% last year. Is 8% so wackadoo for 2009?
Keep repeating it until it sinks in though. House prices in the US declined nearly 10% nationally last year. And the bottom is nowhere near.
Nothing to do with us, though. Nothing to see here. Move along.
February 27th, 2008 at 10:26 pm
http://www.cbc.ca/canada/british-columb … ouble.html
If these insiders were speculators, this is really, really funny…
“The receiver has discovered that 23 condos in the Chandler Development Group projects were allegedly sold to insiders at prices well below market value, Bowra said.
They may get to keep their condos, but will likely have to pay today’s prices, he said.“
February 27th, 2008 at 11:49 pm
February 28th, 2008 at 12:43 am
Unlike the OFHEO or Case-Shiller (or for that matter CMHC and the real estate boards), we don’t know anything about Housing Predictor. We don’t know who they are, we don’t know their credentials, we don’t know their track record, we don’t know their methodology, and we don’t know their motivations.
February 28th, 2008 at 3:23 am
So I guess the assignees will be paying the “lift” twice. Am I understanding this correctly? This could mean many hundreds of thousands of dollars in losses for some people. Possibly bankruptcies over this. Maybe even lengthy legal battles.
Is this just the beginning of a wave of condo projects going into receivership?
This is getting exciting. (munch munch) I wonder what’s next…
February 28th, 2008 at 5:23 am
http://tinyurl.com/26l7ob
February 28th, 2008 at 5:54 am
“There were 271 new listings today and 188 sales for a sell/list of 69.37%. Inventory reached 10,808, of which 2,633, or 24.36% were over 90s.
Over the last three days there have been 760 new listings and 428 sales, for a sell/list of 56.32%”
February 28th, 2008 at 7:53 am
loved that Sun article!
they couldn’t even print the name of the shill that wrote it.
me thinks the end times are nigh……
February 28th, 2008 at 8:09 am
Looks like it was written by Ozzie Jurock.
“It is the ONLY true wealth creator over time. “
February 28th, 2008 at 10:02 am
“Restricted”, eh?
Here’s the footer at the bottom of the article:
Ozzie Jurock is a Canadian real estate adviser and author of Forget About Location, Location, Location. He is featured in Donald Trump’s latest book, Trump: The Best Real Estate Advice I Ever Received. Your can reach him by email at oz@jurock.com or at http://www.reag.ca.
BWAHAHAHAHAHAHAHA! Good call Jade!
February 28th, 2008 at 10:28 am
but look at your Vancouver friends and relatives over the last 40 years - 20 years - 10 years - even two years. We could not have had a more volatile market and yet had you bought, at any time, you would have outperformed all others.
Well, that does it. Sign me up right now. Imagine that; it wouldn’t matter if you bought 40 years ago or two years ago - it’s all the same. Money in the bag.
I’m so totally sold on that idea.