RE Comedy from the onion

Growing weary of watching the slow-as-paint daily moves of the real estate market?

Tired of hearing the back-and-forth prognostications of experts proclaiming endless riches / impending collapse?

How about some humor to pass the time?

Some great lines if you click through the slideshow

“Never imagined you’d be 35, married with two kids, and working a job you can’t stand in a town you once vowed to leave? Then this 3-bedroom, 2.5-bath suburban monument to averageness is for you! Easy access to strip malls, chain restaurants, and charming walking trails for quiet sobbing. Reference number 4JF389″

…. and so on.

126 Responses to “RE Comedy from the onion”

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    Ulsterman Ulsterman Says:
    1

    A couple of weekend anecdote from the weekend BBQ circuit:

    1) chatting to a construction guy working on an East Van reno. Average Joe living there who bought 15 years ago when life was cheaper. They are into a very substantial reno that is completely gutting the main and top floors. They’re living in the basement until the work is done. To paraphrase the construction guy, “Yeah, he’s stressing right out about the money. Since we started he’s had two nervous breakdowns. Been fully hospitalized and everything.”

    2) another friend of a friend just sold his SFH somewhere near Cambie and 50’ish. Been on the market since November with, in his words, “…nothing but low-ball offers.” A builder finally offered him closer to his asking and he jumped. He bought 10 years ago, so i asked him what made him decide to sell. In a very matter of fact way he said that the market is obviously peaked and going down. I told him i thought he’d made a very smart decision, buying 10 years ago and getting out now.

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    fixie guy Says:
    2

    Did the Onion publish a Vancouver Craigslist ad in error?

    “Don’t miss this gorgeous condo with WALL-TO-WALL ceilings, STAINLESS STEEL nails, and in-unit W/D (white doors). Your kids and pets will just love roaming the LARGE YARD-wide hallways! To schedule a viewing, contact real estate agent Ms. GRANITE H. COUNTERTOPS today! Reference number X33JS”

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    fixie guy Says:
    3

    @1 Ulsterman: Re: 1, late last year I rented a typical east Toronto bungalow next door to one of the 2-storey McHomes plaguing the local landscape. My neighbour was in full reno, steel bin in the driveway mode until spring when he listed it for just shy of 3/4 mill. It quickly went to a youngish couple (early thirties best guess) who immediately parked two bins in the driveway, tore out all the previous owner’s upgrades and started on contracted renovations which are still ongoing today. The median home price around here seems to be $4-500K.
    What people are thinking is beyond me.

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    patriotz patriotz Says:
    4

    Home prices rise in most U.S. cities

    Seems US house prices, overall, have hit the nominal bottom.

    April’s increases still leave average home prices in the U.S. 1.9 per cent lower than they were a year ago. But that’s an improvement from the 2.6 per cent drop that was seen in March. Prices in 10 of the 20 cities were up on a year-over-year basis.

    Despite the gains, U.S. home prices remain 34 per cent below their pre-recession peak. Sales are also well off the levels seen in 2006.

    Now how long before some idiot comes on this board and claims that this is bullish for Canadian RE.

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    Anonymous Says:
    5

    @patriotz: “Seems US house prices, overall, have hit the nominal bottom.”

    I doubt it. The US is heading into a recession, Europe is about to implode and interest rates are already at bottom. There is still lots more to go down although some areas may have bottomed. Check for the bottom in about 5 years.

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    http://www.usatoday.com/money/economy/story/2012-06-26/economic-reports-June-26/55834678/1

    Housing prices rose in most of the country in April, as record low mortgage rates and some of the cheapest housing prices in decades spurred some long-desired home sales, while consumer confidence dropped in June for the fourth straight month as fewer consumers predicted the economy will pick up later this year.

    A sign advertises another home sold, this one in Gilbert, Ariz., near the Phoenix area.

    David Wallace, The Republic

    A sign advertises another home sold, this one in Gilbert, Ariz., near the Phoenix area.

    Enlarge

    David Wallace, The Republic

    A sign advertises another home sold, this one in Gilbert, Ariz., near the Phoenix area.
    Sponsored Links

    The S&P/Case-Shiller composite index of U.S. home prices rose 1.3% for the month. The index fell 1.9% for the year that ended in April, Standard & Poor’s reported today. The Conference Board reported that consumer confidence fell to 62.0, on an index where 100 represents how confident consumers were in the boom year of 1985. The house-price gain was larger than economists had expected, while consumer confidence was lower than forecasts.

    “All the headlines are positive on house prices, and this is important because they’ve been going down for five years,” said UBS Investment Research economist Maury Harris. “It’s a confidence bulder at a time when Americans really need something good happening.”

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    @Anonymous:

    This is only a bottom for US RE if interest rates never rise again.

    Like or Dislike: Thumb up 0 Thumb down 0

    @N: “This is only a bottom for US RE if interest rates never rise again.”

    The argument that negative real rates can support prices is dubious.

    Like or Dislike: Thumb up 0 Thumb down 0

    dire straits Says:
    9

    well as long line for food stamps are getting bigger every year and i don’t think hungry people can support even today’s prices.

    Like or Dislike: Thumb up 0 Thumb down 0

    I’m not sure if anyone posted yesterday’s numbers. I didn’t see them posted. So here they are from Larry’s site:

    Vancouver East & West*
    New Listings – 80

    Back On Market Listings – 2

    Price Changes – 49

    Sold Listings – 37

    Vancouver All Areas*
    New Listings – 274

    Back On Market Listings – 6

    Price Changes – 201

    Sold Listings – 123

    *Attached & Detached – Date: 2012/06/25 Time: 21:20 Pacific YatterMatters.com: Courtesy REBGV. Data believed to be accurate but is not guaranteed.

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    patriotz patriotz Says:
    11

    @dire straits:
    “i don’t think hungry people can support even today’s prices.”

    If they are paying rents that are higher than ownership costs, yes they can.

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    Bull! Bull! Bull! Says:
    12

    Domain Name:VANCOUVERCONDO.INFO
    Created On:09-Mar-2006 20:56:22 UTC

    It’s now June 2012.

    Vancouvercondo.info, wrong for more than half a decade and counting.

    Like or Dislike: Thumb up 0 Thumb down 0

    My parents in the last month have been inundated with phone calls from real estate agents asking them if they want to sell their house. Has anyone else seen this happen? Are they that desperate?

    I’m new to this board. I will try to contribute to this board by providing some mid day stats on sales happening for the day. Paul B does a great job at end of day stats.

    I’m interested in the Tri-cities area so most of the stats will be from there.

    Also I can look up some info on properties if people would like. I hate that MLS does not provide all the info to the regular joe.

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    dire straits Says:
    14

    rents pay only the ones who have jobs. the ones without move to mom’s basement couch. no household formation no demand for housing.

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    The Ant Says:
    15

    @Bull! Bull! Bull!: wrong? You mean vancouver real estate isn’t overpriced? That’s a relief!

    Flaherty and Carney will be so glad to hear that there’s nothing to worry about!

    Like or Dislike: Thumb up 0 Thumb down 0

    Navin R. Johnson Says:
    16

    My wife and I make what would have been considered a few years ago, a pretty decent middle class income. We have four kids and NO mortgage. It seems inflation has really crept up over the last 5-10 years. I’m squeezing every nickel for what it’s worth these days just to meet the demands of every day living. I can’t imagine what it must be like to have a relatively new mortgage, car payments, etc., etc….there has to be a lot of sleepless nights happening out there these days.

    Like or Dislike: Thumb up 0 Thumb down 0

    @Bull! Bull! Bull!: “Vancouvercondo.info, wrong for more than half a decade and counting.”

    Buy now or be priced out forever.

    Like or Dislike: Thumb up 0 Thumb down 0

    @fixie guy: You can thank HGTV for that.

    Like or Dislike: Thumb up 0 Thumb down 0

    @patriotz: Now all they have to do is normalize interest rates and see where that leaves the market. I believe there are some Vancouverites now slinking down to the US expecting Vancouver-sized returns on the housing market there. Bubbles beget bubbles, after all. What they fail to realize is that housing in the US is still experiencing outsized Federal government support in the guise of ZIRP and Operation Twist I, II and possibly III.

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    piano player Says:
    20

    @Navin R. Johnson

    I hear you man,
    My car is broken and i need 2k to fix it. I have already put a 1k the month before. I can’t afford to buy new car even with 0% and 84 months financing. and I amking decent coin and work two jobs. Life is so frikin expensive.

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    Aside from the eventual normalization of interest rates, the US housing market must contend with the end of the robo-signing scandal and resumption of bank foreclosures and short sales. Ritholtz is always good food for thought:

    http://www.ritholtz.com/blog/2012/06/annotated-new-home-sales/

    Like or Dislike: Thumb up 0 Thumb down 0

    fixie guy Says:
    22

    19 mac Says: “Now all they have to do is normalize interest rates and see where that leaves the market.”

    Robert Shiller’s inflation-adjusted historical graph shows market prices almost back to the point of stability maintained since World War 2. Given the wild swings in inflation over the period covered it’s unclear whether prices will drop much further without a true Depression-style event.

    Like or Dislike: Thumb up 0 Thumb down 0

    @Bull! Bull! Bull!:
    “Vancouvercondo.info, wrong for more than half a decade and counting.”

    Let’s watch this video of a man throwing a hammer into the air.

    It’s in slow motion. It’s taking forever for the hammer to just leave the mans hand. 20 minutes later the hammer isn’t even half-way up the screen.

    You say the hammer won’t come back down, I say it will. Who’s wrong?

    An hour later the hammer appears to be slowing down near the top of the screen. You say maybe the hammer will slow down, but it won’t fall – it’s been going up forever.

    You say the hammer will ‘plateau’, I say it will fall. Who’s wrong?

    20 minutes later the hammer is definitely going down and who’s that standing directly below it? Why it’s our good friend Bull! Bull! Bull! and now they’re predicting a ‘soft landing’.

    Better hope you’re not wrong, I’m not going to stand around under the hammer with you to find out.

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    Bull! Bull! Bull! Says:
    24

    @Scott: If you bought a condo in 2006 you could put it on the market today, lower than market, have it sell fast and walk away with a lot of money.

    this site is a waste of time.

    Like or Dislike: Thumb up 0 Thumb down 0

    @Bull! Bull! Bull!: Well you sure seem to waste a lot of time on it.

    Tell me, Did you buy in 2006 and sell now?

    If you sold now and got out of the market, why?

    If you haven’t sold, how have you made money?

    Like or Dislike: Thumb up 0 Thumb down 0

    @Bull! Bull! Bull!: “this site is a waste of time”

    Your ironic comments are noted. And with that, troll, I bid you good day.

    Like or Dislike: Thumb up 0 Thumb down 0

    Best place on meth Says:
    27

    @patriotz:

    “Seems US house prices, overall, have hit the nominal bottom.”

    Based on a small spring bounce?

    Doubt it.

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    Not much of a name... Says:
    28

    @Bull! Bull! Bull!:

    If you bought a condo in 2006 you could put it on the market today, lower than market, have it sell fast and walk away with a lot of money.

    I guess it depends on how you define “a lot of money”. In NV, the market I follow, based on the benchmarks from the REBGV, condos have gone from $295k in May of 2006 to $352k in May of 2012. That is an increase of $57k over 6 years. A big whopping 19%. This does not include the carrying costs or closing costs of the sale. So, your “lot of money” is not all that large when the dust settles.

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    Bull! Bull! Bull! Says:
    29

    @jesse: “Your ironic comments are noted.”

    It’s important that people hear the truth about the advice on this site. I don’t want to see anyone fall into the bear trap.

    Like or Dislike: Thumb up 0 Thumb down 0

    Not much of a name... Says:
    30

    @Bull! Bull! Bull!: So your advice is to buy today?

    Like or Dislike: Thumb up 0 Thumb down 0

    Best place on meth Says:
    31

    @Bull! Bull! Bull!:

    “If you bought a condo in 2006 you could put it on the market today, lower than market, have it sell fast and walk away with a lot of money.”

    So you’re saying now is a great time to cash out.

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    @fixie guy: Well. Don’t speak too soon. I believe Merkel just said, “No shared total liability as long as I live.” That could do it. Great Recession Part Deux here we come.

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    Some Lenders Implement New Rules Early
    the window narrows…

    Like or Dislike: Thumb up 0 Thumb down 0

    @VMD: Nice. If “the insurer” aka: bureaucrat has too much paperwork on his or her desk, they’ll decline you anyways because they don’t want to miss their coffee break or work late. Love it.

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    Anonymous Says:
    35

    a unit in my building just sold, it is a one bedroom suite in Vancouver, the price had been lowered once, and it ended up selling for $3,000 below the last asking price. It was listed for over 2 months.

    here is the kicker, and i kid you not….. It sold for the lowest price that any other unit (besides studio suites) has sold for in this building since 2007! there have been approx 7 1-bedroom sales in this building since 2007, this unit sold for 17% less than the highest sale price since 2007

    after realtor fees of about $15,000 (plus 12% HST on those realtor fees!) and lawyer costs (roughly $1000), it basically sold for what similar units were selling for in 2005!

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    Told Yous Says:
    36

    On the Langdale Ferry to the Sunshine Coast, and some knob realtor is trying to cram her client into a 30 year amortization before the new rules kick in. As she says, ” as long as you get the application in before July 9th you are fine – you do not have to close by the 9th.” She is actually claiming that the guys lowball bid of 10k less is “insulting” on a 570k house.

    Remember, this is the Sunshine Coast where inventory is huge, houses are languishing, and prices dropping. Since when is 10k below asking lowballing and insulting.

    Just a typical realtor / seller greed…..

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    Anonymous Says:
    37

    @Told Yous:

    “trying to cram her client into a 30 year amortization before the new rules kick in”

    Perhaps their client had expressed prior interest in a 30yr amort?

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    patriotz patriotz Says:
    38

    @Bull! Bull! Bull!:
    “If you bought a condo in 2006 you could put it on the market today, lower than market, have it sell fast and walk away with a lot of money.”

    No more than a few people who bought in 2006 will do this, nor could more than a few without driving down prices.

    That’s the point you don’t get. Something is really only a buy at a given price if everyone who bought at that price will make money on it in aggregate.

    Otherwise it’s just a bad buy that a few people might unload to a greater fool.

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    Anonymous Says:
    39

    @patriotz:

    The problem is banks don’t want to lend to many people. It is not just about prices being cheaper than rent. Ever wonder why people pay 22% interest for credit cards or why people rent to own furnature? Both cost more than many alternatives.

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    patriotz patriotz Says:
    40

    @Told Yous:
    “On the Langdale Ferry to the Sunshine Coast, and some knob realtor is trying to cram her client into a 30 year amortization before the new rules kick in.”

    Her client is the seller, not the buyer. Her job is to get the highest possible price for the seller.

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    patriotz patriotz Says:
    41

    @Anonymous:
    “The problem is banks don’t want to lend to many people.”

    That’s not a problem for buyers with cash, that’s a plus.

    Like or Dislike: Thumb up 0 Thumb down 0

    New Listings 138
    Back On Market Listings 5
    Price Changes 105
    Sold Listings 87

    AS OF 12:28pm

    Sales are expected to be a little higher due to closing sales by IDIOTS

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    @HFHC:

    Sales are expected to be a little higher due to closing sales by to IDIOTS

    Like or Dislike: Thumb up 0 Thumb down 0

    Anonymous Says:
    44

    @patriotz:

    And you think there are a lot of cash buyers waiting on the sidelines in the US? I dont. The only ones with cash have to sell their homes first.

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    patriotz patriotz Says:
    45

    @Anonymous:
    There are plenty of people with cash in the US, and plenty with cash outside the US.

    The % of RE sales to cash buyers in the US is at a historic high.

    Like or Dislike: Thumb up 0 Thumb down 0

    @Yalie:
    well said.
    My hunch is that new listings will be significantly higher (300+/day) by end of this week (before the long weekend) and stay high next week. There are bound to be some smarter/scared investors/home-owners who know This might be the last chance to get out of the derailed train. (The smartest ones already exited last year)

    Like or Dislike: Thumb up 0 Thumb down 0

    patriotz: “There are plenty of people with cash in the US, and plenty with cash outside the US.”

    yeah right, i buy tree my husba buy tree. US RE is toast and it will stay toast for forseeable future.

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    BulbsForSale Says:
    48

    @Anon: I think you’re arguing the same point. US RE is toast and that’s good for the few buyers that have cash and want to buy property.

    ‘Toast’ doesn’t mean no one is buying, it means very few are buying and all sellers are competing to try to get the few buyers to buy their home.

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    Anonymous Says:
    49

    @Anonymous: “And you think there are a lot of cash buyers waiting on the sidelines in the US?”

    According to this article there are :

    http://www.bloomberg.com/news/2012-06-13/private-equity-has-too-much-money-to-spend-on-homes-mortgages.html

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    fixie guy Says:
    50

    @47 Anon: Almost back to historically normal valuations that the market will bear without stimulus or financial malfeasance is a curious use of ‘toast’.

    Like or Dislike: Thumb up 0 Thumb down 0

    Anonymous Says:
    51

    @Anon: “US RE is toast and it will stay toast for forseeable future.”

    Be greedy when others are fearful?

    Like or Dislike: Thumb up 0 Thumb down 0

    oneangryslav2 Says:
    52

    Has the US real estate market found a bottom? Not according to one analyst:

    “Broward home prices rise 10 percent in May,” reads a typical headline for the Broward County, FL Sun-Sentinel, ground zero for the housing meltdown. The article itself mentions that the ten-percent increase was year-over-year, not month-over-month, and neighboring Palm Beach County suffered a month-over-month decline by a whopping four-percent, but – whatever – home prices are up; let’s party. In this spirit the article mentions Palm Beach sales volume increased, though a close look shows the increase amounts to 114 additional houses sold, out of 664,549 housing units in the county. This figure is so small that my calculator expresses it in scientific notation when I convert it into a percentage.

    His conclusion:

    I own a home in West Palm Beach, FL. I want home prices to rise. But there are just too many factors that continue to drain the economy, including and especially underwater borrowers who push money into their bubble-era basis mortgages, robbing local economies of this sorely needed stimulus. Further, the dearth of first-time home buyers – caused by young people saddled with staggering amounts of student loan debt – will have long-term, very real repercussions.

    We have to deleverage the middle-class, just as we did the banks in 2008, if we are going to put a long-term floor on the housing market. Until then the cheerleaders may inspire a goal or two, but – especially given that inventories are being artificially depressed – no matter how well they wiggle their tuchas or shake their pom-poms we’re never going to rally to overcome this point deficit.

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    Best place on meth Says:
    53

    Price change alert!

    336 58TH AVE E

    From $1,079,000 to…you guessed it, $999,000.

    Like or Dislike: Thumb up 0 Thumb down 0

    Previously (and previous to the rule changes) North Van was hot, hot, hot with young families looking to escape the high house prices of the West Side. You want comedy? Here’s some comedy:

    # of Sales of detached homes in North Van last June 153

    # of Sales of detached homes in North Van this June 35 so far

    Like or Dislike: Thumb up 0 Thumb down 0

    Anonymous Says:
    55

    @Best place on meth:
    What? Only $999 room for a bidding war?

    Like or Dislike: Thumb up 0 Thumb down 0

    @Anonymous: Yeah. Buy the DAX dividend paying stocks now. Sell in 10 years from now. What everyone doesn’t seem to get is that returns are going to be nothing like bubble returns from now until all the crap is cleared from the system–the global system.

    That’s why bubbles beget other bubbles. Because no one can imagine modest returns. They all pile in to the Next Sure Thing.

    Like or Dislike: Thumb up 0 Thumb down 0

    Anonymous Says:
    57

    Does anyone know if there is a blog similiar to this for Toronto? I hear inventories there are soaring but would love to get some numbers.

    Like or Dislike: Thumb up 0 Thumb down 0

    New Listings 237
    Back On Market Listings 6
    Price Changes 181
    Sold Listings 140

    AS OF 3:07PM

    Like or Dislike: Thumb up 0 Thumb down 0

    fixie guy: re US bottom.

    considering that student debt is 1 TRILLION, i don’t think the new household formation is ready to accumulate new debt.
    and what is the other drivers for housing? Jobs? No luck there.

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    Anonymous Says:
    60

    Stories of property moving at 2005 levels? Interesting. Some real estate investor I was talking to today claims vancouver condos cash flow neuteal at current interest rates. I didn’t want to get into an argument with him that Vancouver condos need to cash flow way better than neutral because they depreciate. He was a mortgage, strata fee, tax, and maintenance sort of guy, he needs prayers more than a beatdown.

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    Bull! Bull! Bull! Says:
    61

    @Best place on meth: Sure, cash out now. You’ll be ahead of all the bears.

    Like or Dislike: Thumb up 0 Thumb down 0

    Beuller Says:
    62

    Does anyone have stats on what percentage of transactions in the last 5 years have required CMHC insurance and what the average downpayment was for the lower mainland? This will be very helpfull in determining the affects of the recent changes to CMHC.

    Like or Dislike: Thumb up 0 Thumb down 0

    @Best place on meth:

    I wonder how long it will take them to get with the program and change that to $888,000?

    Like or Dislike: Thumb up 0 Thumb down 0

    patriotz patriotz Says:
    64

    @Anon:
    The other driver for housing is yield.

    Price/rent in the US is now back to historical norms and that means that the net rental yield for housing is now much much better than for treasuries and much better than for investment grade corporate debt. Indeed the spread has never been so high post-WWII.

    That’s why cash investors have been driving the market in the US. People do have to live somewhere and if they don’t buy they are going to be renting.

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    Patsan Says:
    65

    @N:
    Few months perhaps for a chain reaction to happen. The message requires soaking time. Wait until sellers of 1.3-1.4 mil houses start to realize that they have to bring the price down to 999k in order to move them. Correspondingly, the owners of 999k-for-now houses must cut their price further down to compete in the new price range. Methinks that Vancouver West would be the epicentre for such a wave and 888k would be a non-event on the stampede to exits. Just watch Marpole.

    Like or Dislike: Thumb up 0 Thumb down 0

    @patriotz: An interesting take from Calculated Risk:
    http://www.calculatedriskblog.com/2012/06/house-prices-to-increase-10.html

    It is one thing for prices to stop falling – and maybe increase a little over the next year. But, in addition to the large number of homes in the foreclosure pipeline, there are also many people waiting for a “better market” to sell – and I suspect the slightest appreciation will bring more inventory to market. A 10% increase over the next year? Well, three words: Not. Gonna. Happen.

    Not that McBride hasn’t been right before.

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    Anonymous Says:
    67

    @patriotz: “That’s why cash investors have been driving the market in the US.”

    Yes they have really been driving it. Still down big time.

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    @Patriotz

    not only McBride but even Rosie would not agree with you on bottom call. More like in 2-3 years.


    We’ve heard this three times in the past three times in the past three years – that housing is about to recover. There is still far too much inventory when you count in all the shadow inventory, but home prices if you look at the data seem to be covering on the bottom at the same time equity prices are going down. So you’re seeing a negative wealth effect from the equity market at a time when housing market is stabilized.

    I estimate that there’s between two and three million excess housing units on the market for sale when you count it on the shadow inventory. So you’re talking about at least another two or three years to clear up the inventory and put a definitive floor under home prices.

    There’s no question that the decline in home prices is decelerating. Some people are claiming victory that we’ve actually got a floor under home prices permanently. I’m not so sure about that, but I still think it’s at least another two or three years to get housing demand and absorb this supply, put a firm floor under home prices another two or three years in my opinion.

    I think we’re going to get more foreclosed homes now. And it’s going to add to the inventory situation. And my sense is that when you take a look at where the value of these homes are being priced in the marketplace it’s going to put overall downward pressure on home prices over the course of the next several quarters.”

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    patriotz patriotz Says:
    69

    @Anon:
    “not only McBride but even Rosie would not agree with you on bottom call. More like in 2-3 years.”

    I don’t know who Rosie is but I got the bottom call for the US from McBride (Calculated Risk) in the first place.

    From today’s post no less:

    I think it is likely that prices have bottomed, although I expect prices to be choppy going forward – and I expect any nominal price increase over the next year or two to be small.

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    @Best place on meth:
    Current listings between $999,999 and $999,000: 101 units
    http://www.ecorealtyinc.ca/search?q=under+999999

    would be interesting to track the “999” index (especially price drops from >$1M) ; )

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    Maverick Says:
    72

    Just my $0.02. Hard to call a bottom here given seasonality and mitigating factors (renewals, shadow inventory, etc) but given that it’s become cheaper to buy than to rent in many areas, and rock-bottom 30 year amorts, we are about at “fundamentals” and can expect the bottoming process to begin here.

    That said, given US consumer deleveraging and global deflationary trends, there likely won’t be another sustained bull market in RE for at least another 5 years.

    I’d expect sales and prices to oscillate for a long time here, and even take a small leg down depending on how bad the coming recession is. Remember, real incomes are in the toilet for the middle class.

    RE is cheap in the US, but by and large, most folks aren’t in a good enough financial position to buy in numbers.

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    Randomposter Says:
    73

    Interesting study in phychology from today’s postings.

    Canadian prices will remain high because they have been so within recent memory and everyone is buying on the expectation prices will rise further. Many dissenters here, but the accepted MSM opinion.

    US prices will remain low, also because they have been so within recent memory, and nobody is buying on the expectation prices will fall further. Also the accepted MSM opinion, with few dissenters here.

    Fundamentals?

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    Devore Says:
    74

    @Maverick:

    RE is cheap in the US, but by and large, most folks aren’t in a good enough financial position to buy in numbers.

    But investors are, and they are buying. And as we know, it is the properties that sell that set prices. People have to live somewhere, whether they buy or rent. I don’t think anyone is calling for another bull market, or for sales to start setting records again, or even for owner-occupiers to start piling in. I think the return of investors, particularly the cash buyers, is an important milestone.

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    @VMD:

    My hunch is that new listings will be significantly higher (300+/day) by end of this week (before the long weekend) and stay high next week. There are bound to be some smarter/scared investors/home-owners who know This might be the last chance to get out of the derailed train. (The smartest ones already exited last year)

    It will definitely be an interesting 2 weeks. Listings should be higher than normal for the reasons you mentioned, but sales will likely be higher too due to the greatest of the greater fools rushing in “before mortgages get more expensive”. So you have two competing forces – will it lead to higher total listings, lower, or will they just cancel out?

    Either way, the sky is the limit for listings after July 9, and sales will probably plummet too. I’m betting on 21k inventory by the end of the summer and MOI over 12.

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    Anonymous Says:
    76

    @Devore: The returns being offered on US properties are high enough to make Vancouver blush. But Vancouver has immigration, lack of land, and ties to booming Asia so all that warrants piss poor returns. It must be, they will keep telling themselves.

    Like or Dislike: Thumb up 0 Thumb down 0

    market stats Says:
    77

    @mac NVan detached

    good stats, but equally there are still signs of life in that segment how long will it last

    Like or Dislike: Thumb up 0 Thumb down 0

    Best place on meth Says:
    79

    @Devore:

    “I think the return of investors, particularly the cash buyers, is an important milestone.”

    It is for those markets where investors are buying – Phoenix, Vegas, Florida but they’re not buying nation wide.

    These are the areas that were the hardest hit, where real estate is now a bargain and possibly even undervalued, where yields are strong again and where it just plain makes sense to invest.

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    patriotz patriotz Says:
    80

    @market stats:

    Shivram Anantharaman paid a monthly rent of S$2,650 ($2,069) until March. Now, he’s paying S$40 less every month after buying a three-bedroom condominium in Singapore’s East Coast region

    “The clincher in Singapore is that monthly installments toward repayment of your loan are lower than what you would pay in rent,” said Anantharaman, a private banker at ICICI Bank Ltd., who took out a S$1.04 million mortgage for his S$1.3 million property late last year.

    And you thought we had a bubble in Vancouver. Price/rent of 490 for a condo on leased land.

    The article then talks about Singapore’s supposed efforts to curb RE prices. If it really wanted to keep prices down it would simply ban mortgage lending at excessive multiples of rents or incomes or require buyers to quality at normal interest rates. Remember this is a country that bans chewing gum.

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    patriotz patriotz Says:
    81

    @Best place on meth:
    “It is for those markets where investors are buying – Phoenix, Vegas, Florida but they’re not buying nation wide.”

    Investors have to be buying in any market where the ownership rate is falling. Think about it.

    Like or Dislike: Thumb up 0 Thumb down 0

    Best place on meth Says:
    82

    @patriotz:

    Not necessarily.

    The ownership rate has been falling due to millions of homes being foreclosed on.

    The current owners of those millions homes, the banks, are not what I would call investors.

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    patriotz patriotz Says:
    83

    @Best place on meth:
    “The current owners of those millions homes, the banks, are not what I would call investors.”

    But that’s exactly what they are. They’re not giving the houses away, are they?

    Like or Dislike: Thumb up 0 Thumb down 0

    Best place on meth Says:
    84

    @patriotz:

    They didn’t buy them or intend to own them, did they?

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    HAM Solo Says:
    85

    @ Bueller,

    I will try to remember to post the data tomorrow vis-a-vis significance of CMHC and its support of low equity ratio home purchases. From memory, I seem to recall that virtually all first-time-buyer transactions were of the 5% down / 30 year amortization.

    The other factoid I seem to recall is that amongst the 5/30 set almost all are rolling variable s/t mortgages. If ever a risk premium were to arise, or C$ interest rates would rise, then that just adds to crisis.

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    Lucifer Says:
    86

    “I wonder how long it will take them to get with the program and change that to $888,000?”

    Or 666?

    Bahhawhawhaawwaaaaaaaaawwwaaaaahhhhhaaaaaaaa!!!!

    Like or Dislike: Thumb up 0 Thumb down 0

    Got two FI staffers following me on Twitter. Maybe I should start supply-side astroturfing. Thoughts?

    Like or Dislike: Thumb up 0 Thumb down 0

    New Listings 285
    Price Changes 174
    Sold Listings 140

    TI:19442

    http://www.laurenandpaul.ca

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    Anonymous Says:
    89

    @patriotz: “But that’s exactly what they are. They’re not giving the houses away, are they?”

    Give me an f-ing break. Banks taking over foreclosed homes are ‘investments’. They have no choice. It is like calling all the unemployed people in the US ‘on vacation’. You are making Bull,Bull,Bull statements look rational.

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    Jun-2012	
    Total days	21
    Days elapsed so far	18
    Weekends / holidays	8
    Days missing	0
    Days remaining	3
    7 Calendar Day Moving Average: Sales	125
    7 Calendar Day Moving Average: Listings	254
    SALES	
    Sales so far	2170
    Projection for rest of month (using 7day MA)	376
    Projected month end total	2546
    NEW LISTINGS	
    Listings so far	4809
    Projection for rest of month (using 7day MA)	762
    Projected month end total	5571
    Sell-list so far	45.1%
    Projected month-end sell-list	45.7%
    MONTHS OF INVENTORY	
    Inventory as of June 26, 2012	19442
    Current MoI at this sales pace	7.64
    

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    Anonymous Says:
    91

    Sorry, I’m sure this has been answered many times, but what is considered a buyer’s market in terms of MOI? Thanks!

    Like or Dislike: Thumb up 0 Thumb down 0

    Anonymous Says:
    92

    One more thing….I can’t name a better dude in the RE biz than Paul B. Seriously. Month after month he posts on a bear blog…..whilst plying his trade as a realtor.

    If I EVER buy, no matter where, he’s my realtor.

    Like or Dislike: Thumb up 0 Thumb down 0

    @jesse: Post an article about how all the banks and credit unions fired everybody when the party was over in the US. Or post articles about the Australian carnage from macrobusiness.com.au since they’re just a bit ahead of us.

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    David Rosenberg has been wrong since March 2009. I agree with his overall macro picture, but translating that into market calls hasn’t gone so well.

    Like or Dislike: Thumb up 0 Thumb down 0

    @Anonymous: “what is considered a buyer’s market in terms of MOI?”

    Remember the days when a “buyer’s market” meant that prices were low? Prices typically drop with MOI above 8 and rise with MOI below 5. MOI will typically increase in the second half of the year. An MOI of 7.5 in June portends price weakness for the next 6 months. But is that a “buyer’s market”? I would suggest they rename it a “lack of buyer’s market”!

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    @rp1: Since we’re discussing housing bottoms and Calculated Risk has been mentioned a few times already, here he Calculated Risk laying the smack down on Rosenberg a few days ago
    http://www.calculatedriskblog.com/2012/06/david-rosenberg-cracks-me-up.html

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    Anonymous Says:
    97

    @jesse: Thanks, Jesse.

    Like or Dislike: Thumb up 0 Thumb down 0

    @jesse
    “here he Calculated Risk laying the smack down on Rosenberg a few days ago”

    so guy did not anticipated blatant and massive printing by the Fed that produced the unsustainable run on the stock market is somehow wrong in his take of the state of US economy???

    Like or Dislike: Thumb up 0 Thumb down 0

    fixie guy Says:
    99

    59 Anon Says: ” what is the other drivers for housing? Jobs? No luck there.”

    If Shiller’s methods are sound, the housing market sailed fine through plenty of other recessions after WW2. The most remarkable aspect is just how constant the HPI remained when not in a bubble. Since the 1800’s the only prolonged period in which it dipped below was The Depression. Student debt is unlikely to change that.

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    Anonymous Says:
    100

    @rp1: “David Rosenberg has been wrong since March 2009.”

    I don’t think so. Like bearish predictions around here only time will tell who is right and who is wrong. Things have not played out yet. He was one of the few predicting a housing crash in the US and was ‘wrong’ until he was right.

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    Anonymous Says:
    101

    @jesse: “here he Calculated Risk laying the smack down on Rosenberg a few days ago”

    Hardly a smack down. Here is part of the ‘bullish’ quote of Rosenberg’s so widely reported on. Not really very bullish. Still predicting a recession.

    “The future is brighter than you think. This does not mean we will not have another recession, by the way”

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    Keeping An Eye On The Pimps Says:
    102

    “I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.”

    Thomas Jefferson,

    Like or Dislike: Thumb up 0 Thumb down 0

    @Anonymous: “Hardly a smack down. Here is part of the ‘bullish’ quote of Rosenberg’s so widely reported on”

    CalculatedRisk was smacking down Rosenberg for claiming he was “ahead” of the market when there were pundits calling the start of a massive equity bull rally in 2009. People following Rosenberg’s advice would have missed out on that. That’s all, not criticizing Rosenberg’s overall message, whatever it is.

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    BC reader Says:
    104

    Another amusing bear segment on BNN today. Shiller was quoted as saying it is absolutely not a bottom in the US housing market.

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    HAM Solo Says:
    105

    @ Pimps

    Great quote. Wouldn’t it be great if Canada actually pulled off a real rescue in the face of the big housing bust. Instead of rescuing the banks who have been cynically over-extending credit, in the belief that the government will provide unlimited support to prop up CMHC, what if we just let the banks fail and, instead, gave the money to the people?

    That would be the fairest thing to do, and it would also probably lead to the quickest rebound. If post-bust each person was given say $100,000, then the folks without a $666,000 mortgage would be rich…as they deserve to be, and the folks levered into condos or who are counting on a retirement funded by dividends from sleazoid Toronto financial institutions would be poor … as they deserve to be.

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    frank Says:
    106

    @jesse:

    Rosenberg completely missed the whole run up after Feb 2009. He kept saying the other shoe would drop as the S and P doubled and the TSX went up more than that.

    Doom and gloomers are eventually right, but by then a lot of money has been left on the table.

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    @HAM Solo: Soooo after giving away free money to idiots we should give away more money to other idiots? And who pays for this? Oh yeah. The idiots who saved. Nice plan.

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    HAM Solo Says:
    108

    @ mac

    We give the money to everyone. Everyone is not the same as idiots. It includes you and me and all the rest.

    If you have no house debt, then you are ahead by 100K.

    If you have house debt, you are still ahead by 100K, but seeing as your starting point is minus 666K, then you are still poor.

    If we give the money to the banks instead, then all the weasels at BMO who lent $800K to 21 year old mobile phone salesmen to buy in Yaletown keep their jobs. But the poor fools on the bottom of the pyramid get foreclosed on. All the yaletown restaurants go under. And all the rest of Canadian humanity enters a 15 year grind trying to service the ridiculous bubble era debts.

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    @BC reader: Shiller was on Bloomberg, he was mostly concerned about the prevalence of finance in driving US economic output, and claimed prices haven’t quite reached bottom, though are close. His major point I garnered was that housing should not be viewed as a pure investment vehicle, it should be viewed as something to be consumed, and that people can make money from facilitating that.

    He also thought bond markets were “strange”. I can’t disagree, I could never figure them out either!

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    Anonymous Says:
    110

    @frank: “Rosenberg completely missed the whole run up after Feb 2009. He kept saying the other shoe would drop as the S and P doubled and the TSX went up more than that.”

    You sound like a real estate bull. You could make the same statement about Vancouver real estate.

    We will see how many people who ‘doubled’ their money (which was really making back part of their losses) cash out before the next financial crisis. The TSX has been flat for 2 years where Rosenberg has done much better being long gold and bonds.

    Like or Dislike: Thumb up 0 Thumb down 0

    @mac: “And who pays for this? Oh yeah. The idiots who saved.”

    Yeah it’s not fair; still I’d rather have savings than be stuck in an underwater (debt-wise) house I don’t like and face foreclosure if I lose my job. Depressing, but I’ll take the spread nonetheless.

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    Anonymous Says:
    112

    @frank: “Doom and gloomers are eventually right, but by then a lot of money has been left on the table.”

    Only if you cash out prior. The vast majority will lose all their gains and then some. It works the same as Vancouver real estate.

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    @HAM Solo:

    Sadly, I don’t think it would work that way. You have seen what happens when the government tries to “give” people money to buy houses. Houses just get more expensive. If you give everyone 100K, you might goose the economy for a while, but you might also spur inflation, which you would then have to counter with interest rate hikes. I have a feeling that the whole thing would end very badly. I have very limited knowledge or macroeconomics but it seems to me that markets are like living things, and if you mess with them, they mess back.

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    HAM Solo Says:
    114

    @ N

    I’m just playing the tape forward and thinking about options. Based on the course we are on, house prices collapse 40%+, unemployment is 20-25%, John Q. Public is up the creek without a paddle and yet tens of billions of freshly printed cash gets sent to Bay Street. That is Canada’s default policy. The winners in that game are the people who are already independently wealthy to the extent that their home is just a minor portion of their assets. The losers (if we look at the US for a second) are all the people who thought they were middle class, and who had a net worth pre-crash of say $300K, and post-crash their net worth is zero or negative and they have no job to boot.

    You guys don’t like the $100K cash to everyone…show me a better plan.

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    @HAM Solo:

    I don’t see why unemployment would to to 20 to 25%. It hasn’t in the States.

    My plan would be to further limit CHMC insurance to first time buyers with 10% down, and then let nature take its course.

    Seeing that you can no longer get rich by buying a house, people might try other ways of getting rich, like out competing the guy beside them at work to get a promotion, or starting their own business. That, and not government handouts, is how societies gain wealth.

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    HAM Solo Says:
    116

    @ N

    I think if you read through Mish’s blog or read Rosie or follow other independent analysis, you will find that the actual US unemployment rate post-crash is much higher than the official rate. A large part of the improvement in unemployment numbers has been in reducing the official workforce count because people are self-employed at much lower income levels, have retired early, have returned to school, have claimed disability, etc.

    The other thing to keep in mind is how much more focused on real estate Canada’s economy is than the US was even at the peak. If you live in Vancouver, take a walk around and count the condo towers under construction…look at all the brand new Ford trucks with some goofy building contractor business logo shining in the fresh paint, look at all the home reno’s going on. Who works at these jobs? What would happen if the projects weren’t there? I’ll cut to the chase…Vegas is what happens. Crickets. No tax dollars ‘cos no one is working except public sector people.

    This thing is like a chess game. You have to think a few moves ahead. And if you play those moves in your head, it is hard not to picture a pretty desparate town, province, country in a few years.

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    mobile vhb Says:
    117

    So the reason why you can’t give everyone $100K is that it would cost $3,500 Billion or so. That’s ten years worth of federal tax revenue or so.

    There will be no bailout of individuals. The government will not come to anyone’s rescue. There may be some boutiqye window dressing program but the numbers just do not work for the guv to bail out underwater homeowners.

    Just in Van if they gave 100K to 100 thousand households that is 10 billion. Do you really think they’d give that kind of dough away? And there will be more than 100K needy households and many would need far more than 100K to make a difference.

    Those expecting govt to swoop in and make it all better would be better off waiting for the Easter Bunny.

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    HAM Solo Says:
    118

    Why does it have to be taxed from anyone? Why couldn’t Flaherty just print it up? That’s what Bernanke does

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    Maverick Says:
    119

    @HAM Solo:

    We can’t print like the US because we’re not the US, which has a unique standing in the world.

    We’re more like Spain. The bond market would punish us in no time if they thought we were going in over our heads in debt.

    That’s going to be the real kicker when prices plunge here – if the government thinks they can print or if the economy gets bad enough – guess what?

    Bond rates will go up, as people sell their GoC bonds. And housing falls even further as mortgage rates also get pushed up.

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    patriotz patriotz Says:
    120

    @Best place on meth:
    “@patriotz:
    They (the banks) didn’t buy them (foreclosed houses) or intend to own them, did they?”

    Yes they did. Foreclosures in the US are an auction where the house goes to the high bidder. The bank doesn’t automatically get it. It has to outbid everyone else, its bid being the balance of the mortgage. If someone bids more than this they get it, not the bank, and the bank gets the balance paid.

    The very fact that someone (including a bank) owns a property at the present time means that they want to own it. If they didn’t want to own it they would sell it, wouldn’t they?

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    patriotz patriotz Says:
    121

    @Keeping An Eye On The Pimps:
    Jefferson had good reason to dislike banks (he had a longstanding problem with debts) but at least a good part of this quote is invented.

    In particular, the term “deflation” was not coined with respect to the economy until the Long Depression of the late 19th century.

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    HAM Solo Says:
    122

    @ Maverick

    I know a lot of people have said things about the uniqueness of the US like that. I am not sure, however, that we cannot print…or that the C$ bond market would collapse when we printed the first dollar. Remember, marking down the Canadian housing stock by 40% could be just a tad deflationary.

    I suspect in the end we are going to print. I guess we will find out what happens.

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    Crikey Says:
    123

    @HAM Solo:
    “Why couldn’t Flaherty just print it up? That’s what Bernanke does”

    Well in that case, let’s just get Flaherty to print up billion dollar bills and pay off all our debts instantly with a handful of them, while simultaneously sending every Canadian one of these crisp new bills.
    (Can you say, “Wealth reset”?)

    Nevermind that investors in Canadian bonds would have a fit in either scenario, and that either scenario would send inflation and interest rates wildly out of control. Yeah, printing money on a mass scale, evening if “only” $100,000 for each Canadian, has big consequences.

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    fixie guy Says:
    124

    123 Crikey Says: “.. would send inflation and interest rates wildly out of control. Yeah, printing money on a mass scale, evening if “only” $100,000 for each Canadian, has big consequences.”

    Crashing the economy even further. That ‘freebie’ will eventually come straight out of the pockets of fixed income earners and the retired. Starve the infirm to feed house gluttons? No thanks.

    Like or Dislike: Thumb up 0 Thumb down 0

    HAM Solo Says:
    125

    @ fixie

    of course it’s going to come out of the pockets of the retired. News flash, everyone under 40 is F-ed because the housing market has been goosed for years. Meanwhile every 60-something high school dropout with a house is a millionaire, with boatloads of bonds to boot.

    So what if the old people get diluted. It’s their turn.

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    Crikey Says:
    126

    @HAM Solo:

    I agree that it is time to dilute the wealth of the boomers whom while simultaneously helping rack up the debt for their successors have taken home the spoils and left others holding the bag.

    Perhaps pinpoint higher taxes towards the very well-off baby boomers; increase estate taxes, etc?

    Unfortunately, the older generations are much better at voting than the younger ones, so I can’t see any party with these kinds of ideas being voted in.

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