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December 5th, 2009 at 10:07 am
@stagnate:
I think the Olympics will have an effect. Buying on this expectation would be speculative. People should buy for the long term, not a short term maybe.
December 5th, 2009 at 9:57 am
wondering why a RE bear blog would attract
a climate change denialist……
December 5th, 2009 at 8:53 am
#47 Yo Patr, ‘ran out of buyers’ well put. I am one of those who have wondered where the inflection point would be. As we have seen the BOC manipulated the bar dow to zero and have thier backs against the wall. Its all uphill from here on.
Tricky Trichet the Eurozone Bank boss has today announced the path to higher rates is immediate, beginning ‘in the new year’. Exactly when that will be is of course another question.
http://www.bloomberg.com/apps/.....BfRHhIWU5E
December 5th, 2009 at 5:22 am
@Phil:
Asset bubbles do not need any catalyst to burst. They are Ponzi schemes in which the payoff to the investor comes not from earnings but by the sale to the next owner. Because of this they require exponentially increasing inflows of capital which must eventually come to an end, regardless of any external events.
Take a look at an example close to home – Calgary. What caused the market to turn mid-2007? Not the local economy – oil prices were at an all-time high. They just ran out of buyers.
http://cuer.sauder.ubc.ca/cma/.....algary.pdf
December 5th, 2009 at 5:05 am
#44 logic
It’s only ‘the vast majority’ if you’re reading the insipid propaganda of the Liberal wacko’s in the Canadian ‘give it all away cause we feel guilty set’. You need to get your head out of David Suzukis ass and realise theat the ‘vast majority’ is in reality a small minority of grant takers and hangers on.
Look there is huge money involved here. The third world leaders and the bleeding hearts who fail to understand them are pushing at this string because they want to be flooded with cash. it has nothing to do with climate change. You are supposed to be mobilized ‘to save the planet’ as an advertising gimmick to get you to give up your stuff and give it to the greedy buggers in Asia and Africa who would rather steal aid money from the west instead of working for it the way we in the west have done over the centuries.
Don’t be fooled here. When the Danish speaker of the house stands up in a Danish podium and states the truth you should be in fact woken from your slumber not disonant of the facts that the Danes are expounding.
He states explicitly why the climate change agenda is a carbon tax to feed the less developed countries and to meet the energy needs of the developing world. It doesn’t say anything about saving the world from greenhouse gas. Thats just a red herring designed to misle the weak minded.
If you had read the Grundfeld Document ( precursor of the Kyoto Accord) and the Kyoto Protocal itself you would know the facts and not just parroting the words of the advertisers. The Kyoto Protocall (I repeat) is not a climate change document, it is a tax scheme to shift economies towards the third world from the west. It has been successfully advertised as a means to ‘save the planet’ but only in Canada have the coffe bar afficianados grabbed onto every word without a complete understanding.
I’ve met Davis Suzuki, he seems like a nice guy, but that doesn’t make me want to believe everything that comes out of his ivory tower asshole. This talk of ‘ a majority’ has never been the case. I just sent you a verbatim speech from the danish Parliament ( the greenest government on the planet) and you can’t swallow the truth? Man. you can’t handle the truth.
BTW its also warmer on Venus.
Scary facts are facts all the same.
December 5th, 2009 at 2:15 am
Heard from a common friend that staff of a developer will get 10% salary increment next year. Some sectors are excited over China’s recent announcement of ADS (Canada being the Approved Destination for Chinese tourist), which augurs well for Metro Vancouver’s real estate. They come, they see, they buy.
Don’t stone the messenger to death. I’ve been following VHB’s blog since 2004. We need to hear from all sides.
December 5th, 2009 at 1:47 am
wtf –
You are arguing against the vast majority of scientific evidence
I’m not prepared toa rgue this point here with you, because it would be pointless.
Enjoy your delusions.
December 5th, 2009 at 1:31 am
phil: a lot of factors can influence the real estate market but the olympics aren’t one of those factors. no one is going to feel an urge to invest here just because they saw a bit of figure skating or skiing on tv. on the other hand the olympic rental bonanza never materialized and investors have already either listed, sold, or rented for the medium/long term. the olympic boost like the expo 86 boost is a myth. i doubt that people have bought specifically thinking the olympics would boost their investment. i could be wrong but i don’t think the olympics is bullish or bearish for local real estate. the downtown rental market will take a bit of a hit from job losses which is bearish of course.
December 5th, 2009 at 12:38 am
#40 logic
Call this guy and tell him he and everyone else but you are wrong on the same issue. Whoops apparently the clumsy illiterate propaganda from Canada is not accepted world wide.
http://politiken.dk/newsinengl.....851820.ece
The PC nonsense is simply a runaway train of gullibility.
December 5th, 2009 at 12:29 am
You PC morons and coffee bar intellects have been sucked in the hype. The climate argument is nothing but a smokescreen designed to tax the west and send the proceeds to the third world for ‘sustainable development’. The Kyoto Protocall was a tax measure not a climate measure….read it, if you can/dare.
Climate measures have indicated extremes for millions of years. Earth has had periods of hundreds of thousands of years of drought and ice age before man discovered fire.
Fortunatly not everyone has so much empty head space that advertisers can squash in so much nonsense. Yes, read the article objectively, it states that a majority of research has been based on assumption, prediction and ‘fudging the numbers’. The article agrees that the liars getting caught has set back the climate change argument twenty years, in other words, to the beginning of the ‘sustainable development’ scheme.
This whole Kyoto protocol started as a side paper included in a larger document dreamed up by an ex prime minister of Norway. The carbon tax was seen as a way to fund economic development in the third world, which is why all third world countries were not required to sign up!!!!!
The ‘new’ funding plan was called ‘sustainable development’.Which is why all the third world countries in the UN and the AID agencies who stand to profit signed on so enthusiastically. If you want an education,look that up, it’ll be worth it.
BTW its also getting warmer on Mars.
December 4th, 2009 at 11:51 pm
“We’ve been duped.”
—
You are a very very stupid person. Try reading the entire story and some background.
December 4th, 2009 at 11:45 pm
#34) Thanks for replying. I agree with you on Japan. I am searching for a catalyst to the turnaround, other than an interest rate hike. I believe, as you do that the only possible catalyst is a flood of investors listing their properties after the olympics. Apparently job losses have not worked! Perhaps everyone is holding out hope that despite of their dire financial situation, selling their property post olympics will be their financial saviour.
December 4th, 2009 at 11:43 pm
“Climate change debate proven false flag. Its all been bullshit advertising to screw the people out of more money to send to the third world.”
That’s your conclusion? WTF is appropriate, because HTF could anyone be so stupid. Even accepting the most extreme interpretations of the email in question, proof that some adherents have been less than honest is not synonymous with proof that climate change itself is false. And your fabricated ‘third world’ supposition is simply idiotic.
Get an education; it really is worth the money.
December 4th, 2009 at 10:38 pm
Climate change debate proven false flag. Its all been bullshit advertising to screw the people out of more money to send to the third world. The entire Kyoto concept is a blanket thrown over the ‘sustainable development argument’ that Brunfeld and Trudeau started to pump 30 years ago, which was to send enormous amounts of western tax money overseas.
We’ve been duped.
http://www.theglobeandmail.com.....le1389842/
December 4th, 2009 at 10:22 pm
Nobody talking about the ‘Canadian real estate goes wacky’ article/post(from the friday free-for-all list). Its a must read. For me it was the first full summary of whats going on. Something I could print out hand to someone who has their real estate head up their ass,asking “why haven’t you bought”. jmho.grrr
December 4th, 2009 at 10:09 pm
@Drachen: You’re probably right. Those numbers are from November, after all. Not really a prime time to be adding that number of jobs in an industry like education. August perhaps, but November? Very strange.
Well, the numbers look very good nonetheless, so mission accomplished.
December 4th, 2009 at 9:59 pm
@Phil: It’s perfectly viable for a housing market to tank despite low interest rates. One need only look to Japan to see that. As to prices here heading south prior to June of next year where there’ve been hints of a possible rate hike, I guess that’s something for debate. I see this as being a long, drawn out process and price declines will take a while to get going. I’m expecting a lot of people to try and cash in after the Olympics, putting their places on the market only to discover everyone else is doing that at the same time, followed by a lot of people thinking, “Oh, crap!”
December 4th, 2009 at 9:06 pm
I was watching one of those real estate porn shows. You know the ones on HGTV where the host berated people for not jumping in and paying whatever it takes to buy real estate. It was an episdoe of location location. I british show one of the worst of the bunch. Well it was funny the second home the couple was looking for was in Berlin. A featured condo, sort of a loft like apartment in a trendy area was listed for 59,000 euros. I always hear Vancouver is cheap and has a way to go to catch up to those european cities. As if wealthy europeans are arbing the difference between europe by selling high there and buying low. Well what a bunch of crap.
December 4th, 2009 at 8:20 pm
What are the chances there is a housing bust while interest rate remain low? Any thoughts? If the BOC keeps their promise and leaves rates until June, does anyone believe real estate will decrease in the meanwhile? Perhaps Olympics inspired?
December 4th, 2009 at 8:03 pm
@Vansanity:
They were talking about that on the CBC too, I suspect, given how anomalous the data is that it’s either a mistake or intentional fudging of numbers. It wouldn’t be the first time recently we’ve had a rosy report only to have it amended a few months later as the government says, “Oops, our bad!”
December 4th, 2009 at 7:36 pm
How to beat the real estate market:
http://www.globefund.com/servl.....GFWIStory/
December 4th, 2009 at 6:10 pm
In regard to the employment figures released today, which were really positive, an expert analyst on ROB TV this morning said 40,000 of the 79,000 jobs created were in education. He said that they’re all scratching their heads at it thinking: “where did the sudden need for 40,000 teachers come from?” Indeed.
Anyway, sounds a bit suspicious, but I’m a conspiracy theorist by nature.
December 4th, 2009 at 5:22 pm
@joycer: Any idea if the FT/PT positions are temporary or permanent? I didn’t see that in the report. Most of the gain was in the service sector, and isn’t there a lot of retailers hiring at this time of year for the (ugh) holiday shopping season?
December 4th, 2009 at 4:12 pm
Apparently the number of hours worked went down so this is a bummer.
December 4th, 2009 at 3:56 pm
Unemployment numbers can be quite deceiving based on how they do their counting.
To me, payroll numbers make more sense.
How many people are being paid salaries and/or wages?
How much are earnings per week?
This will truly tell you whether people are employed or not and whether wages or hours are being cut.
These have a direct impact on tax revenues and consumer spending.
December 4th, 2009 at 3:44 pm
Not to throw cold water on the good news about jobs and sooner than expected rise in bond yields, but does anyone with more statistics knowledge know if the numbers were affected by the fact that this time last year there was a significant drop in employment, i.e. the seasonality adjustments for this report were biased upwards by last year’s drop.
December 4th, 2009 at 3:02 pm
@crabman:
Yes but is that causality? I think the real causal relationship is this one:
http://www.forexpm.com/oil-usd.....ation.html
And the price of oil is of course the most important fundamental in Canada – US trade.
December 4th, 2009 at 1:38 pm
2 – Limey – how about if that one “source” was a FRIGGING PRESS RELEASE!!!
http://smr.newswire.ca/en/rema.....te-in-2010
break into groups, compare and contrast…actually just compare…
December 4th, 2009 at 12:20 pm
I think if you changed “Dubai” to “Vancouver”, in the headline of this Tyee article, you’d have a pretty good description of Vancouver – it would certainly be more fitting that “The Best Place on Earth”
“DUBAI, A BROKE AND MORALLY BANKRUPT MIRAGE.”
http://thetyee.ca/News/2009/12.....struction/
December 4th, 2009 at 12:17 pm
@patriotz: You are making far too much sense! ;^)
To me, it looks like the CAD/USD exchange rate is being driven almost totally be investors and not fundamentals. If you look at a graph of the S&P 500 vs the CAD over the last few years, they look virtually identical.
December 4th, 2009 at 11:02 am
@logic:
It’s not even really “less weak” if you look at how they calculate “job losses”.
They figure out how many people are “out of work” by looking at the number of people who lost their jobs in the last 6 months minus those who were re-hired.
If that number increases by 11,000, they say they “lost” an additional 11,000 jobs ignoring the fact that people who moved from 6 months out of work to 7 months out of work are dropped from the list. So in reality the number is much higher considering how many people lost jobs 6 months ago.
December 4th, 2009 at 11:02 am
@logic:
I think what dave means is that it beat street consensus which can be considered strong. What is strange is the divergence from the ADP report; so this could be noise.
December 4th, 2009 at 10:49 am
The Tyee article is pretty good and they get +10 points for working the show “Weeds” into an article about real estate.
The Vegas article has an interesting footnote too:
The research company is a unit of Richmond, British Columbia-based MacDonald, Dettwiler & Associates Ltd. It compiles surveys using county records and supplies real estate information to customers including public agencies, lenders and title companies.
Is a BC based company really qualified to talk about real estate?
December 4th, 2009 at 10:46 am
X Dave Says:
December 4th, 2009 at 9:20 am
@joycer:
That’s a strong job report. The US report was strong as well, with only 11,000 job losses, which is the best month since the recession started.
——————-
Dave, one can hardly call the US report “strong”.
Perhaps “less weak”.
December 4th, 2009 at 10:38 am
Forgot to add, I think your basic premise is flawed, Canada is far far more export oriented than the US and demand from the US (which buys 80% of Canada’s exports) and China, among others, would outweigh the drop in consumer demand (which to a large extent is for imports anyway) from a housing bust.
Now I do think BC, which is the only mega-bubble province in the country, is going to go up in smoke and flames because the real economy has taken a back seat to RE. But not so in the rest of the country. The only other province-wide bubbles are in Alberta and Saskatchewan and not only did they have a smaller bubble which has already partly deflated, they have strong export economies. Alberta also has a high savings rate.
December 4th, 2009 at 10:29 am
@crabman:
A falling CAD would lead to a bond market bust which would end the carry trade. Nobody would want to lend in a falling CAD at low rates. That’s the reason weak currencies have high interest rates.
It is not possible for two closely linked economies like to US and Canada, with similar inflation rates, to have diverging interest rates.
December 4th, 2009 at 10:05 am
Last night we were watching GLOBAL/Canwest Channel 2/7 news, which is sponsored be REMAX.
Their latest fluff piece that is linked here was front and centre masquerading as a “news” article. ROFL !!! The wife looks at me and says “this is bullshit”…….pretty interesting comment coming from someone who just moved here 6 years ago from a foreign country, and has only started closely watching the mess that is our RE market, over the last 24 months.
December 4th, 2009 at 10:03 am
Anyone think that the employment bonanza has anything to do with the Fed Head being under pressure to extend his term? Nothing like a sudden burst of good news to get a loser re-elected. Hmmmmmmmmmm.
http://www.ft.com/cms/s/0/bb20.....ck_check=1
December 4th, 2009 at 9:55 am
I would wait for the ‘revisions’ before putting too much faith in the initial jobs numbers reports from the government(s). This recovery (so called) has been nothing moe than a PR battle so far. Todays numbers are to extreme to be credible IMHO and will be revised down after the Christmas shopping season is over. The good news is possibly a smoke and mirrors campaign to boost consumer confidence.
December 4th, 2009 at 9:26 am
Good omens for higher mortgage rates in the short term.
December 4th, 2009 at 9:26 am
“Your choice is to hustle, or to be stepped on by hustlers.”
(On the misallocation of resources in a bubble.)
http://tinyurl.com/yf76uat
The most destructive social consequence of a large bubble is the misallocation of capital. Resources (money, effort, time) get redirected away from goals that would truly build a society and into high risk speculation, into chasing the fast buck. Honest and prudent citizens make 0.4% on their Canada Savings Bonds. Condo flippers make more in year than the average Canadian could save in a lifetime. Grow-operators make tens of thousands per month, tax free, with no risk of imprisonment. Five years of this and a lawless, frontier quality creeps in to the prevailing ethos. Your choice is to hustle, or to be stepped on by hustlers. Blog discussions show that ‘legal tax evasion’ has become a priority for many regular citizens. It is also clear that the players in the housing boom have quite simply broken the law by not paying taxes. Undeclared income from tenants. Under the table cash payments for construction work. Flippers avoiding taxation by calling each flip a primary residence for someone in the family. When this lawlessness is rampant, honest citizens feel like schmucks for being honest. One hopes that the CRA has their best folks on this. The public coffers certainly could do with the revenue. More important, the society needs to be confident that honest and well directed efforts are those that are most valued and rewarded. -vreaa
December 4th, 2009 at 9:20 am
@joycer:
That’s a strong job report. The US report was strong as well, with only 11,000 job losses, which is the best month since the recession started.
December 4th, 2009 at 8:50 am
@patriotz:
That might have be true in the past. Now, we have investors and hedge funds playing the carry trade. If, in two years, the US economy is recovered and Canada is in the midst of a housing bust, US interest rates should be higher than ours. If these carry trade investors play the USD/CAD, they will drive down the CAD. Also, since the Canadian economy will need all the help it can get from exports, you can bet the gov. will do what they can keep the CAD low.
December 4th, 2009 at 8:41 am
Sorry, should have been added 79,000 not 59,000 (39,000 full time and 40,000 part time).
That’s HUGE for our economy, can you imagine if the US would have announced an increase of 790,000 jobs this month?
December 4th, 2009 at 8:37 am
Let the rate hikes begin!
-Last GDP numbers showed we have returned to growth (left recession)
-Carney has already warned consumers of higher interest rates to come and being prudent with these emergency measures
-This morning’s unemployment better than extected 59,000 gain in jobs and rate declined to 8.5%
http://ca.news.finance.yahoo.c.....-cent.html
December 4th, 2009 at 8:00 am
#4 P, the inevitable bump in rates is exactly why the foriegn bond holders are absent and the Canadian gov is buying all its own paper. The inverse relationship has got the CDN gov bent over a rock and a hard place as rates can only go one way at this point.
Its all a sham leaving the taxpayer on the hook. At this point I think the CDN gove is prepared to fleece every bond holder with some form of draconian trade off. Perhaps it will be as Garth has suggested and the internal claw backs will become ripbacks.
Flaherty said recently ‘we have other tools’, what could he possibly have aside from ‘extremis legislation’ at this point? Currency controls? Tell me it ain’t so Jimmy.
They sure as hell can’t lower rates or implement any more QE than they already are without blowing a big hole in the bottom of our already leaky ship.
If this doesn’t cause a revolution then what else? A surprise bump in rates would annihalate the dollar shorts in Ottawa.
This is a lose lose situation for everybody, courtesy of the Cons. Either there are higher rates or taxes go through the roof or the national debt becomes unsustainable. I believe we are currently at 79% of GDP now. Canada is not the US with endless pools of foriegn capital to tap as a reserve currency. I figure we hit the low 89′s and the emperor gets naked.
December 4th, 2009 at 6:04 am
If consumer price inflation is seen to be heading above the official BoC target of 2%, you will see a bust in the bond markets, i.e. a sudden jump in interest rates. It would be inevitable, which is why I think it will not happen – BoC will crank up its own rates to keep CPI under control first.
I do not buy the money printing (i.e. inducing inflation) scenario for this reason – a bond market bust would be devastating for the Canadian economy at the current levels of indebtedness.
@San Franciscan in Vancouver:
A house price bust in Canada would be positive for the CAD, because it would result in a large decrease in consumer demand, much of which is imports, while demand for Canada’s exports would be unaffected.
December 4th, 2009 at 2:51 am
Even though the Canadian Government attempts to keep its head up its ass it may be forced by outside forces to come up for air at some point.
World rates are going up as liquidity scares central governments into looking at losing primacy to gold and commodities.
http://in.reuters.com/article/.....dChannel=0
The Canadian government can keep on accumulating debt as long as it is OK with the Canadian people who don’t seem to mind the fact the massive tax increases and service cuts will occur as long as the gov keeps intrest rates articially low in order to pump the RE market and hold the loon lower than the plumetting USD. Its a scary scenario.
http://www.kitco.com/ind/nadler/dec032009.html
The lower the gov drives the loon means exporting inflation to our manufacturing centers in China (since we no longer manufacture anything in canada) where costs are going up like crazy due to thier own massive flood of money into the economy to quell rising unemployment in the cities.
Wages are now shooting up in China ( because thier internal currency is flooding the system with cheapening paper)and that means higher prices at Wallmart here.Our wages here are going down while nflation is raging in non CPI hedonic measured consumables.Soon the BOC won’t be able to hide behind counting only cheap Chinese made T-shirts and plastic spoons. Real costs are going way up in China and that means here to.
So, what does that mean? Can the CDN gove continue to flood the system with phony money for real estate at zero intrest rates while keeping the lie about low inflation going? Not likely.
I see rampant inflation coming down the pipe from all sides. This can only lead to two things
1) the BOC can continue to pile up debt and ratchet up local taxes until everyone is cleaned out.
2) they will go bankrupt and the IMF will force international rates into the local market in order for Canada to meet its debt payment obligations.
Can that mean a sudden rate rise of several hundred percent possible overnight? I think so.
December 4th, 2009 at 2:16 am
Hold on, I stand corrected. According to RE/MAX the housing market is going to stay strong.
Now I don’t want to start picking on the Canadian mainstream media, or the state of BC journalism in general. But in other parts of the world, if you wrote and article about RE, and where it’s going in the next year, and only used once source, and that source had a suspiciously high level of investment in the RE industry. It would be regarded as some sort of joke.
What’s next? “Cigarettes found to extend lifetime: Marlboro”, I mean for christ’s sake – it’s pathetic. Where’s the objective discussions questioning the status quo? Am I being naive? I thought this is what newspapers are supposed to do – not re-write advertisements for large corporations.
Along the RCMP ban of protesting, I’m wondering where the impetus or the right has gone to speak one’s own opinion. If you’re looking for a reason why so many people are about to run off a cliff with Real estate, I’d say this might be a good place to start.
(Sorry if this sounds a bit anti-Canadian – I’m married to a Canadian, and generally I think you’re all swell.)
December 4th, 2009 at 1:54 am
The Californian posting is very interesting. It is amazing that there’s line-ups outside new development sales offices. My word there’s going to be a mess. But who’s going to clean it up?