@patriotz: ….

Larry: None of which has anything to do with whether you waffled or not.

@patriotz: …Larry and council were elected November 16, 2002, were sworn in at the beginning of December, and voted to hold the Olympic referendum at their second council meeting on December 10, 2002, with only the NPA councillors opposed.

Reconcile those facts with your claim……

Listen, Larry: occasionally you make cohesive arguments on this blog (even though they rarely pan out) then you go and state something really stupid which tends to water down the credibility of your other statements.

You (Larry) championed holding a referendum on the Olympics

You got elected on a platform which included holding a referendum on the Olympics

As soon as you got elected, you said you didn’t support a referendum on the Olympics

Then you were shamed into supporting it.

You are a politician, ipso facto, you are a dink!

“Throughout 2007, the average Canadian home buyer who took out a mortgage had only 6% equity in their home. The 6% equity is or equals the national average downpayment for all mortgages including home buyers who traded up to more expensive homes.”

Source?

CMHC

“Throughout 2007, the average Canadian home buyer who took out a mortgage had only 6% equity in their home. The 6% equity is or equals the national average downpayment for all mortgages including home buyers who traded up to more expensive homes.”

Source?

Here's a more recent estimate of home owner equity:

http://financialinsights.wordpress.com/2011/02/02…

I think the 6% is referring to new home owners…

Not to put too fine a point on it, but one of the dangers of a 0/40 or a 5/30 is that when you take out a new mortgage, and start out with such a low downpayment, and such low equity, (average 6%) it takes a very small decline in prices before you are underwater on your mortgage. Negative equity increases default. Technically it shouldn't, but it does. The increased defaults lowers the credit quality of the mortgage bond that default was located in. You get enough defaults (especially since the actual credit quality of these bonds is lower than their stated quality) and the whole thing collapses in on itself, which is what we just saw happen during the sub prime meltdown. The reason we are in such precarious shape is that instead of deleveraging like most of the… Read more »

@UnagiDon

I should have been more specific, I was considering people who were taking out mortgages, not individuals who are mortgage free.

From CMHC data:

"Throughout 2007, the average Canadian home buyer who took out a mortgage had only 6% equity in their home. The 6% equity is or equals the national average downpayment for all mortgages including home buyers who traded up to more expensive homes."

@vancouverseniorsecondarymarket: I agree with you on most points, but I'm not sure your 6% equity number is correct. The numbers stated by Ben are closer to 70%:
http://financialinsights.wordpress.com/2010/11/09…

Of course, the current equity percentage depends on the current "value" of the property. I'm sure there are some people who would like to argue that high valuations are justified by the high equity percentage, but that is of course a circular argument.

@vancouverseniorsecondarymarket:

"Considering the average mortgage holder in Canada has around 6% of equity in their home, that basically means we are f*cked."

i know NAFTA was probably the last nail in Canadian Sovereignty, but surely this must be ONE NAIL EXTRA JUST TO BE SURE.

@vancouverseniorsecondarymarket:

"Now many of us have not had the benefit of the intro to finance course that you took at the local community college and that you lord over us, the great unwashed, like you are paul fuckin’ krugman, but we are not idiots."

my god

i respect your rage

the year my friend came back from Carleton and started quoting Krugman on a daily basis – i wanted to kick him in the face. teeth. temple. the man's "ideas" are like some kind of terminal virus.

"They are, you may be shocked to find out, two separate risks. Also, for hedge funds like Bear Stearns that took multi-billion dollar losses, what they did was buy the lowest tranche “junk” CDOs, and then borrowed money off of their valuations. When default rates started to rise and the valuation of the CDOs dropped, these hedge funds suffered margin calls and this is what ultimately made Bear Stearns go under." Except this part is factually incorrect. What actually happened has been well documented by the actual people involved. 1. Bear Stearns was not a hedge fund. 2. Bear Stearns had hedge funds at their company. 3. Those hedge funds did not suffer margin calls. What did happen was that a rumor was spread that bear stearns was suffering from liquidity problems and was receiving margin calls. These rumors (probably… Read more »

@miss jackson In addition, by pointing out the dismal performance of the financiers of our great capitalist system, I was pointing to the greatest risk to our system of all, which buffett, graham, klarman, and fisher all point out: that the greatest risk lies not in interest rate risk, or market risk, but the greatest risk lies in not knowing what you are doing. In other words, the risk managers most important task is managing his own ignorance. I knew you were full of shit when you threw out a number – 10-20%. As if you could possibly have any way of knowing. The beauty of 20% though is that it represents over $200,000 off the price of the average single family detached home in Vancouver. Making the 20 percent loss greater than the average loss on a SFH in… Read more »

@miss jackson "You should re-read your response to me. I said that institutional investors know how to hedge their interest rate risk and rising interest rates will not cause a crash. You response was “well what about the financial crisis?” And I responded that the financial crisis was caused by default risk, not interest rates rising. And now you’re trying to steer the argument in a different direction. So I suggest you stay on topic, which is that rising interest rates will not cause an MBS “crash” as you claimed." The point you missed (perhaps intentionally) was not that I believed that the sub prime meltdown was cause by interest rate risk, but rather that I do not believe the people that could not manage default risk or market risk, to such a degree that it caused systemic risk (an… Read more »

@vancouverseniorsecondarymarket:

you're really informative – great read

"The stopping of which precipitated one of the largest bank bailouts in the history of Canada? Am I just making this up?"

you ARE however, making this up – after all, Miss Jackson doesn't remember that bailout. her and the rest of the country – go out on the street and ask – NONE of them remember that at all. i do, and i remember TELLING friends and family about it and getting strange looks "there wasn't a canadian bailout" etc etc. epic retardation.

another myth that will have to die a nasty death with this is not just that RE always goes up,

but that our banking sector is totally solid.

@Conrad:

Right buddy, here is entirely different. Like another planet, show will run forever. Keep laughing…

@Flip Flop:

Every mortgage in Canada that was initiated since rates plummeted in 2008 is equivalent to a US teaser mortgage.

There is something to be said for the teaser mortgages not being as rampant (or existent for that matter) in Canada, and the inability to walk away from the mess, like you can in the US.

It should help slow the stem of supply, in comparison to how it all rolled along south of the border.

Will it be enough? I have little faith that it will. At the end of the day our debt levels are comparable, so I can't imagine it's going to play out much differently.

It's ugly out there. Debt free and renting on the cheap with a good job is a pretty place to be.

@Best place on meth:

Love the numbers. As expected the changes made by the Dept. of Finance have made the public get more favorable mortgages but have not touched demand. Mortgage brokerages are doing huge business, I really don't see this market slowing down a bit until at least Q3. Bond Yields plummeted again today, looks like we are in this mortage rate range for a long time yet.

Crash? thanks for the laugh guys

@coastal:

(there's a lot of groups that global blows on a regular basis – peel this onion far enough and you'll cry – but wait, Sun TV is starting within a week! finally, some competition for Global – LOL j/k

@Junius:

"when we as tax payers get stuck with millions of dollars of CMHC loans. Pure fiction."

yo slap a B on that, braw

@patriotz, "Those are the facts."

Well, yes and no, that's one summary of the facts.

Someone (can't remember who) said very publicly that he was very confident that Larry would change his mind about the Olympics once he "saw the numbers" after he took office. Well, Larry saw the numbers, and Larry did change his mind. Yes, he held the referendum and yes, the voters did say "Yes".

But … imho, he got elected on a platform that saw him playing devil's advocate, but never fulfilled this role once he stepped into his office. The best he could do was deliver a referendum that wouldn't have meant much even if it went the other way.

@Anonymous:

i thought we were run by brutal thugs? er..