Parable of Treeland

In the late 1700s, Europeans first discovered a largely unpopulated area with a temperate climate (although annoyingly rainy) and rich in resources of lumber, copper, gold, zinc, coal, petroleum, natural gas and fish. Reflecting that forests covered more than half its area, they named the broader area “Treeland” and it’s major city “Racoover.”

In the mid-1800’s, news broke out that there was gold on the banks of the Fraser River and over 25,000 prospectors swarmed in, hungry for instant wealth. Several towns instantly sprang up. To help maintain law and order, the government incorporated the colony of Treeland. But within a few short years, the frenzy of the gold rush fizzled out.

When Racoover officially became a city, it had 1,000 people. The first mayor was Realtor® McLean. One summer day, a brush fire got away and burnt the city to the ground in less than 30 minutes. McLean, knowing the value of real estate, got rebuilding going in a matter of days.

With its rich resources, Treeland was rapidly developing into a great province. The economy was based primarily on forestry, nicknamed “green gold”, and accounted for over one-third of export earnings. Mining and fishing were also major contributors to the GDP. These export earnings were used to build infrastructure using very little debt. New public facilities included the CP railway line, Granville Bridge, electric streetcars and the first skyscraper. The world’s largest indoor ice rink was built for the Racoover Millionaires, the city’s first hockey team. Beaver Place Stadium inflated up and became the world’s largest air-supported bubble.

Treeland had very little debt and banks prudently provided secured, low leverage, tight amortization, fixed-rate loans on sound homes and vehicles to be used by industrious citizens who lived within their means. There was no speculation flipping in highly leveraged investments.

But even a province as sound as Treeland could come to ruin if it failed to address the dangers that can be caused by the ordinary accidents of life. These dangers were significant when Treeland’s forestry industry got hit with multiple problems. First started the rampant forest fires and pine beetle epidemic, spreading over 15 million hectares. Then came rising energy prices and exchange rate with Eagleland, Treeland’s main trading partner. Times suddenly changed and forestry jobs started disappearing fast. Tens of thousands of jobs vaporized and it became hard to keep track of the mill closures.

In Sep 2001, Eagleland suffered a tragic foreign attack. In response, Chairman Greyspan sought to stimulate the economy and ordered banks to give away gambling chips at low interest rates. Treeland quickly followed suit with this plan. As their affluence and leisure time grew, Treeland’s citizens more and more whiled away their time in the excitement of casino gambling. With the low interest rates, low down payments, long amortizations, gambling chips insured through CHMC, and an obscene amount of chips created thanks to fractional reserve banking, the banks flooded the economy with chips and made all gamblers steadily and increasingly rich.

The winnings of the casinos eventually amounted to 40% of Treeland’s GDP, while 10% of the gambling profits were paid to persons employed by the casinos (many of whom were needed elsewhere in more productive jobs). So much time was spent at casinos that it amounted to an average of several hours daily for every citizen of Treeland. To satisfy the gambler’s addiction and to create new gamblers, the HGTV television network was formed. Social gatherings were alive with feverish, eye-popping discussion about how much winnings were made that week in the casinos. Many of the gamblers started placing bets with a new product called presale assignments, similar to the reckless leveraged futures contracts used in Eagleland.

In 2004, Racoover was selected to host the biggest circus in the world. This fuelled the casinos even more. Soon, there were three-day line-ups just to get into the casinos. Some visited three casinos per night while sending their spouses to a different three. Some speculated that even foreigners were participating in Treeland’s roulette wheels. The gamblers all religiously chanted the three tenets of gambling: “Everyone wants to gamble here,” “Casino winnings always go up,” and “Treeland is the best place on earth.”

A few unspoiled souls, the Savers, regarded this situation as disgraceful. After all, they reasoned, it was just common sense for lenders and citizens to avoid gambling addicts. They cried desperately for the madness to end. Their reasoning was echoed by international reports which showed the world how irrational Treeland’s behaviour had become.

Then in late 2008, all of Eagleland’s gamblers suddenly went bankrupt within weeks and caused a viscous downward spiral that permeated around the world. No one could foresee (so the media said) that Eagleland’s economy was a house of cards that eventually bust, severing Treeland’s exports and economic engine. The Savers, who had been patiently waiting for the madness to end, finally got their break. The stats showed a plunge in casino visitors and the Savers celebrated wildly each time another 10 casino halls became empty. But after a few short months of healing, the governments slammed interest rates to the floor. Gambling activity roared back but the resource industry dwindled and unemployment still remained at record highs. The winnings of the casinos eventually accounted for every single penny of real GDP. How was Treeland supposed to adjust to this brutal new reality?

The circus came to Racoover the following year but the circus folk, puzzled by the madness of the locals, did not participate in the casinos as the gamblers had hoped. The exorbitantly priced Circus Village that was built for the circus clowns could not be sold and went into receivership.

Then the Good Father sounded the alarm bells that Treeland’s gambling chips exceeded those in Eagleland, which was now on life support. He strongly urged Treeland’s citizens to stop their casino gambling and began reinstating shorter amortizations and higher interest rates. He knew this change was sure to induce vomiting and hallucinations in the addicts and suggested that citizens cheerfully embrace their fate. And sure enough, the casino owners and employees (“pimps”), who strongly believed in the beneficence of hyper-gambling, were hostile to change. They petitioned to the Good Father to make gambling easier. However, the pimps’ efforts failed and gambling restrictions became tighter.

By 2010, the gamblers stopped making profits no matter how hard they tried cranking the slot machines. Even some players of the Racoover Millionaires (now renamed Canucks) got caught in the casino mess and suffered heavy losses. By 2013, roughly half the gamblers went bankrupt. The remainder were wiped out by 2017. Much counterproductive governmental action was taken, and the land’s credit was reduced to tatters. Treeland is now under new management and has been renamed: Brokeland.

Submitted by: Crashcow

Reference & inspiration: Basically, It’s Over

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jesse
Member

Now THAT is original content. Way to step up to the plate C.

TIME MACHINE
Guest
TIME MACHINE

Excellent piece.

You forgot to mention the supposed droves of Mainland Chinese gamblers. The casino dealers and bosses told all the local gamblers to be fearful because these Mainland Chinese gamblers were buying up all the chips.

But in the end it turned out there weren't many Mainland Chinese with chips to gamble with – and those few who were gambling went home anyway once the Shanghai casino, which had been smoking for years, finally burned down.

Keeping An Eye On Th
Guest
Keeping An Eye On Th

" Chairman Greyspan sought to stimulate the economy and ordered banks to give away gambling chips at low interest rates. Treeland quickly followed suit with this plan."

Yes, it's true Treeland had its quasi version of Greyspan-Wimpy Dadger.

But we all loved Wimpy, because he sounded like Milhouse from The Simpsons.

metalhead
Member
metalhead

Bwahaaha. Good stuff.

VERYand extremely WE
Guest
VERYand extremely WE

what a low grade pathetic resentment written by house-non loser who still dream of European supremacy.Nowadays,European economic dominance is a long gone history.Today,Chinese economic power is the only major reason behind the never ending up surge of Van RE.

After the 2008 US and European economic implosion,Chinese money can buy off all the RE in US and Europe combined.Van RE is just a bean nut for Chinese government which is eager to set up an anti-American alliance with Canada .

VERYand extremely WE
Guest
VERYand extremely WE

@TIME MACHINE:

Chinese government has 2000 billions in foreign reserve and the number is still ticking upward by minutes.White power is fading fast daily since 2008.

Anonymous
Guest
Anonymous

that is a funny piece; a sourgrape and full of jealousy kind of funny piece!

1
Guest
1

Chipman says the market is hotting up – is this true?

BoB
Guest
BoB

Hard up for content today?

Anonymous
Guest
Anonymous

holy bitterness batman…

get a life bear….

you are in the peasant non land owning class…

things will not change….

you missed the boat on lifetime gains in RE and the best you can hope for now is for prices to moderate that rapid ascent so you can finally get on board

Junius
Guest
Junius

#6 Very Wealth,

Yes, but all the hot asians woman still go out with white guys. Why is that?

Renting
Guest
Renting

The exorbitantly priced Circus Village that was built for the circus clowns

It still looks like there a few circus clowns hanging around.

Hey clowns it is almost February. The Circus Village will be back on sale soon. Last chance to borrow chips over a 35 amortization. Time to get in before even clowns are priced out forever!

Renting
Guest
Renting

Hard up for content today?

What's wrong? Don't like clown stories?

We are laughing with you clowns not at you. Honest.

Renting
Guest
Renting
Response from yesterdays thread @ulsterman: Sorry to blow a hole in your theory, but in fact i DID sign a one year lease. I said sign a 3 year or 5 year lease and renew prior to it expiring. So, i guess i wasn’t trying to have it both ways as you so thoughtfully put it. Then why are you whining about it. You had flexibility as that was the agreement you made with the landlord from day 1 with the one year lease reverting to month to month thereafter. You signed the agreement and could have asked for a different agreement or sought a different place to rent with terms you want. WRT a new roof. You need to be pretty unobservant to be a homeowner and not have an understanding that your old roof will need replaced in… Read more »
WFT?
Guest
WFT?

Merryl Lynch economist on BNN this morning said that the BOC rate is too low given the Canadian GDP and price statistics reported today.

Rates are going up soon. Bulls better pray that the rich asian myth is real and that they can support the entire market because no one else will be buying at current prices.

Prices are heading down soon.

jesse
Member

@Renting: Cooperatives are an option as well, and believe it or not people actually get accepted into them from time to time. Eviction problem solved (unless you murder someone).

Agree on long-term lease thing, though as you hint they aren't that common from what I've seen. As I mentioned before I think many LLs aren't comfortable with long-term leases due to it limiting the buyer pool if they want to sell and them not having confidence or ability in finding good tenants or dealing with bad ones.

Long-term leases are out there, you just need to be upfront with landlords that's what you're after, and save yourself a chunk of time. If the LL doesn't want to even consider a long-term lease, it's worth asking why.

Alum
Guest
Alum

well written pure bullshit

Dan in Calgary
Guest
Dan in Calgary

@anonymous at various times, "you are in the peasant non land owning class…"

If you tell us enough times that (because of your putative financial well-being) you are better off than the rest of us (who may have "wealth" in family and real friends), will you actually begin to believe it? Do you need to constantly assure yourself that you're on the right track? Do you want us to say it too? Would that help?

Devore
Member
Devore
@jesse: As a renter in Vancouver, you stand to save tens of thousands of dollars in housing costs every year over owning. I think it is a good idea to spend a couple extra hours doing the work and negotiating a satisfactory lease. Instead of the "oh woe is me" after-the-fact approach our friend ulsterman has adopted. Man up man! A homeowner, over the period of owning, will need to deal with, negotiate and build relationships with many people. Realtor, mortgage broker, lender, lawyer, contractor, plumber, chimney sweep, roofer, carpenter, inspector, and many others. As a renter, you only have one. Your landlord. It's not that hard. Spend some time, do it right. Or, as Renting said, there's a realtor out there ready to get you into a million dollar east side tear down of your very own, so you… Read more »
Troll
Guest
Troll

Is this fairy tale a way to avoid talking about what has been a pretty strong January? We may even see rising prices last this month.

Troll
Guest
Troll

@Renting: I think the clown is the moron who can't even identify the difference between investing and speculation. Who thinks buying a Van home in 2000 was somehow equivalent to buying tulip bulbs. Yes, I'm talking about you. moron.

Best place on meth
Member
Best place on meth

….and after the circus left town, all the circus dogs were executed at point blank range and thrown into a large hole.

The end.

Chillax
Guest
Chillax

and after the circus left town, all the circus dogs were executed at point blank range and thrown into a large hole.

The end.

*****

Best Place on Meth

Your posts exhibit a lot of anger and resentment, bordering on teenage angst.

For a kid still in grad school, and not even in a position to buy yet, why are you so bitter?

You should be enjoying yourself at the student pub, and marveling in the fact that you get paid to mark a few papers and run a few tutorials.

Who cares if a bunch of undergrads have purchased condos, and the girls flock to those guys.

Maybe in another decade, prices will have come back down to a place where you can buy and girls will be interested in you.

In the mean time, relax.

registered
Member
registered

#18 Dan in Calgary Says: "If you tell us enough times ….will you actually begin to believe it?"

A particularly contemptible and racist take on Chinese global hegemony is the new main topic over at RET. (That and the "you're angry" meme.) It was only a matter of time before the pointy hoods appeared here. Though I hesitate to ascribe what are perhaps the actions of a couple psychotics to the local RE industry in general, it is a fact that none of the latter, not one, at RET has raised an objection to this repugnant behaviour. Stay classy, Vancouver.

jesse
Member

@Devore: "As a renter, you only have one. Your landlord. It’s not that hard. Spend some time, do it right."

Absosmurfly. Treat it as a business relationship.

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