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Anonymouse
Anonymouse
8 years ago

@Devore:

I'm sure it's a new thing in Australia, just saying they've been learning from other tightwad banks

Anonymous
Anonymous
8 years ago

Shhhhh. Don't look behind the curtain.

Careful about spending too much time on ZH or AE. You'll end up with basement full of tinned food and shotgun shells (like me).

Devore
Devore
8 years ago

@DEFAULT NAMEe: Well they seem to be making a huge deal about it. I'm sure it's not the first time RBA cut rates.

Makaya
Makaya
8 years ago

Guys, this is off topic, but this is a must read as it concerns the fragility of the financial markets in general and the Canadian Banks in particular. Frightening… From zerohedge: "Why The UK Trail Of The MF Global Collapse May Have "Apocalyptic" Consequences For The Eurozone, Canadian Banks, Jefferies And Everyone Else" (…) "Simply said: when one truly digs in, MF Global exposes the 2011 equivalent of the 2008 AIG: virtually unlimited leverage via the shadow banking system, in which there are practically no hard assets backing the infinite layers of debt created above, and which when finally unwound, will create a cataclysmic collapse of all financial institutions, where every bank is daisy-chained to each other courtesy of multiple layers of "hypothecation, and re-hypothecation. In fact, it is a link so sinister it touches every corner of modern finance… Read more »

Anonymouse
Anonymouse
8 years ago

@Devore:

In the uk that's common practice. If its a rate hike it's applied to mortgages immediately and to savings accounts a month later. And vice versa for a rate cut.

Anonymous
Anonymous
8 years ago

@Best place on meth: you might be interested in that article as well…

http://pragcap.com/the-chanos-crash-timing-chinas

Devore
Devore
8 years ago

@ReadyToPop: In Australia central bank dropped its rate, but banks are saying no thanks: http://www.theage.com.au/business/canberra-powerl… I like how the article mentions how much every day the banks will make on the difference, but makes no effort to quantify additional costs they have.

ReadyToPop
ReadyToPop
8 years ago

They could have priced at prime. Spreads are not that horrendous. But pricing above prime makes more of an impact. It makes higher-profit fixed rates more appealing and it mentally prepares consumers for potentially higher VRM premiums down the road.

That said, banks are not just arbitrarily sticking it to borrowers. The main reason variable rates are worsening is that banks' costs are rising, and they want to recoup those costs.

Variable Discounts Turn to Premiums

Anonymouse
Anonymouse
8 years ago

@DEFAULT NAME:

"Actually, I think you’ve hit the nail on the head: Clearly rising price have no limit."

Strawman.

Anonymous
Anonymous
8 years ago

@Kid ON Candy: …Every year its like watching a fat kid chasing a piece of cake, only to have the cake yanked away from him when he is just about ready to gorge on it……

Er, isn't that called FORECLOSURE?

Anonymous
Anonymous
8 years ago

@Kid ON Candy: …and the bear dogma in the face of reality always impresses me…….

Bear Dogma? Is that the opposite of Bull Shit? Actually, I think you've hit the nail on the head: Clearly rising price have no limit. I'm holding out to sell my 400 sq ft leaking condo for $100M (Cause I know that's the 'reality' you're referring to). Who said LSD died out in the 70's?

Best place on meth
Best place on meth
8 years ago

There has never been a Ponzi scheme anywhere near as huge as China, and never will be again. Just staggering.

http://www.scribd.com/doc/75058489/PGVF-2011-Chin

11 pages of pure reading pleasure.

Kid ON Candy
Kid ON Candy
8 years ago

I don’t understand why some of you guys get all crazy at one or two months of data only to have egg on your face a month later. Sit back, relax, and wait for the show to REALLY get going. ________ Lol – this blog would be dead without the sensational headlines and micro inspection of monthly data. It would be even more dead without the bears constantly claiming the sky is falling. Sometimes I think they have the memory of a goldfish in a bowl – each time January rolls around they predict the end is near, prices move higher in Spring, anticipation builds in the fall without any meaningful price drops, and then another year is done. Repeat…. I have been coming to this blog since its beginning, and the bear dogma in the face of reality always… Read more »

Devore
Devore
8 years ago

For a more thoughtful and detailed discussion of the Victoria market, beyond "lulz its crashing, no it isn't", you should go House Hunt Victoria.

Anonymous
Anonymous
8 years ago

@ Makaya & DNe

I'm sure alot of sellers won't lower their price enough to meet the market and eventually give up. It must get depressing to have a For Sale sign on your lawn for 12 months of the year.

But wow, those Schuswap price drops are drastic!

DaMann
DaMann
8 years ago

I have to agree with Troll. "Victoria is crashing" is a pretty sensational headline. Unless I see 15% decrease minimum YOY or multiple years of 5-10% drops, then as a bear, I'm not even batting an eye lash. Seen this bullshit before only for it to start jacking up in spring. I truly believe a crash is coming, and it will happen, but with essentially free money sticking around ( low rates) it could be a while yet. I thought 2008 it was finished ( I even sold my place in July 08), but I didn't foresee the zero % rates jacking it all back up again. I don't understand why some of you guys get all crazy at one or two months of data only to have egg on your face a month later. Sit back, relax, and wait… Read more »

bullwhip29
bullwhip29
8 years ago

@ frank December 7th, 2011 at 12:54 pm

A 5% drop in RE prices is pretty minor. Hardly Defcon 5 sort of stuff as the author of this post is suggesting. Anyone that can't afford a small hit like this shouldn't have gotten into the market to begin with. Watch what happens when prices start to slide by that much on a monthly basis for several successive months and the general population starts to panic.

Makaya
Makaya
8 years ago

@Makaya: "I don’t know. You would have to compare with MOI #s during previous RE crashes in Vancouver…" I meant BC, not just Vancouver.

Dzevad
Dzevad
8 years ago

@Troll:

How do you know that frank lives in the baement? I don't get it.

Makaya
Makaya
8 years ago

@DEFAULT NAMEe:

"Not sure I understand. What happened to the ‘rush for the exists’? Shouldn’t inventory increase along with prices under that scenario?"

I don't know. You would have to compare with MOI #s during previous RE crashes in Vancouver…

Troll
Troll
8 years ago

@frank:

So a bozo like you who bought two years ago would now lose 5% + costs = 8% and meanwhile inflation has gone up 4% as well.

And you still live in a basement, so what's your point?

Troll
Troll
8 years ago

@frank: Update, now 5 people agree with your definition of crash.

I weep for what this blog has become, the inmates are running the asylum.

Anonymouse
Anonymouse
8 years ago

@frank:

So all you gotta do is wait 2 years from when Vancouver's MOI reaches 20 and you'll be able to buy a Vancouver SFH at a 5% discount?

frank
frank
8 years ago

@Troll:

Hey Troll – are you stupid or being deceitful on purpose. read the following CAREFULLY, several times..

Victoria's SFH November 2011 Median price is 5% LESS THAN NOVEMBER 2009!!!

Got that?

We are 5% lower than TWO years ago.

So a bozo like you who bought two years ago would now lose 5% + costs = 8% and meanwhile inflation has gone up 4% as well.

Alum
Alum
8 years ago

This blog has been up and running for years !

same content is repeating again.

Nothing would crash except blogger's a*s lol