7 Canadian banks get negative outlook

Standard and Poor’s have downgraded their outlook for 7 Canadian banks from stable to negative.

And what has motivated this downgrade?

High housing prices and consumer debt.

Now you can bet that S&P are aware of the CMHC and the backdoor bank bailout, but when things get this out of balance there is a spill-over effect.  If you can’t pay the mortgage you probably aren’t paying the credit card bill either, and there’s no CMHC buying up credit card debt.

“A prolonged run-up in housing prices and consumer indebtedness in Canada is in our view contributing to growing imbalances and Canada’s vulnerability to the generally weak global economy, applying negative pressure on economic risk for banks,” the rating agency stated in its decision. “Growing pressure on banks’ risk appetites and profitability arising from competition for loan and deposit market share could also lead to a deterioration in our view of industry risk.”

The seven Canadian banks with a negative outlook are:

-Bank of Nova Scotia
-Central 1 Credit Union
-Home Capital Group Inc.
-Laurentian Bank of Canada
-National Bank of Canada
-Royal Bank of Canada
-Toronto-Dominion Bank

Full article in the Globe and Mail.

 

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jesse
Member

@jesse: Oops *stronger than 2008

jesse
Member
@Vote Down The Facts: It looks that inventory peaking is likely, but by no means certain. One of the models I would consider is if sales are not high enough relative to inventory in the spring, weakness will be amplified in the second half of the year: the thinking here is that in most years there is enough “sales inertia” to allow the weakest sellers to safely exit, but if volumes aren’t high enough to clear these types… we should not discount that conditions could continue to slide. Not to say this model is the right one — it’s only my conjecture — and it could be 2012 is on target to be weaker than 2010 but stronger than 2012. This scenario would be based on macro factors: lackluster population growth, continued malaise in wold economies including a slowdown in… Read more »
Anonymous
Guest
Anonymous

@Vote Down The Facts:

It’s too soon to tell. Actually it’s remarkable that the inventory has pretty much stayed around 19k this summer.

I have a feeling the peak is October 2012.

Vote Down The Facts
Guest
Vote Down The Facts

Inventory has basically peaked for the year.

Krusty the Clown
Guest
Krusty the Clown

@Turkey:

and this ridiculous $1.5e6 listing continues to languish

Now THAT is cynical. $1.5 million for 2300 s.f. on a 25 foot lot in Stratcona?!? Unbelievable.

piklishi
Guest
piklishi
VMD
Member
Romeo Jordan
Guest
Romeo Jordan

I went for a bike ride in the westside just now.

Up and down at least 40 blocks.

Many, many blocks had two to three for sale signs.

I must have counted a sixty or so in total.

And get this muppets….NOT A SINGLE SOLD SIGN….NOT ONE….NADA…ZIP…ZERO…ZILCH

Holy truck, it’s begun.

Still, we have a way to go before we hear widespread screams in the night.

Bo Xilai
Guest
Bo Xilai

Uh, Oh… Chinese home price increases could give give a jolt to Vancouver real estate… (Despite my bearish inclinations)…

http://www.bloomberg.com/news/2012-08-01/china-home-prices-rise-in-market-turning-point-soufun-says.html

VMD
Member

@VMD:
If Flaherty didn’t introduce the CMHC rules this month, we could’ve been looking at -25% to -30% YoY in sales (as compared to the current -16%), and MOI >9.5 (vs the current 8.5).

August will be much more exciting!

chilled
Member
chilled

Anyway, the VCI minions once again eat their own and profess not to subscribe to ‘group think.’ Too funny, too stupid.

chilled
Member
chilled

@Joe_blown_away_by_high_housing_costs:

READ my first post today, oh sorry, you can’t, it’s already has been thumbed down to oblivion.

Once again, thank you VCI for validating my point.

I can only hope a few of you will remember what it was.

Joe_blown_away_by_high_housing_costs
Guest
Joe_blown_away_by_high_housing_costs

@chilled

No, I am arguing I am not a group thinker because you accused the contributors of this blog of being group thinkers. I am a contrarian among my own political fold.

You really should spend more time reading this blog. You will see a great deal of debate. Contributors here do not all espouse the same opinions. That’s why I think this is one of, heck scratch that, THE best forum to discus Vancouver urbanism bar none. I have learned a great deal from this blog and vreaa and that’s precisely because the contributors do not all think like me or like each other.

chilled
Member
chilled

@joe_blown_away_by_high_housing_costs:

“This political partisan diversity on this blog demonstrates that the contributors to this blog are not group thinkers.”

If you have to claim you are not into group think, you *are* group think. Christ, you sound like a Scientologist.

chilled
Member
chilled

@ScubaSteve:

“Time for you to drink your milk and have a nap.”

A completely irrelevant comment from a minion hoping to be thumbed up by his fellow minions.

Anyway, thanks for validating my point.

ScubaSteve
Member
ScubaSteve

@chilled:

Time for you to drink your milk and have a nap.

joe_blown_away_by_high_housing_costs
Guest
joe_blown_away_by_high_housing_costs
@chilled: “what pisses me off more than idiot hypocritical blogging are conformists who migrate en masse to the ‘group think.’ Sorta like THIS blog.” I can handle being called a lot of things, but a “group thinker” is something I have to take objection to. I pride myself on my independence of thought. My comments on the urban development of Vancouver, Little Mountain, urban renewal, demolishing the viaducts, gentrification, race issues (gentrification led by non-whites–very unusual in other places/times but it is happening in Vancouver), climate, Chinese soot leading to increased rain on North America’s west coast, etc, etc–all of these comments reveal a brain that thinks for itself and does not participate in group think mentality. I am an NDPer but I can criticize the NDP and Vision Vancouver better than most Conservatives can. Actually that reminds me of… Read more »
chilled
Member
chilled

@xyz:

Whattareyou? High?

Have you been paying attention to THIS blog?

Sorry, you’ve confused me with the first person on VCI who has critiqued someone connected to the Realturd® Ponzi scheme.

If you thing GT is beyond reproach, may I suggest you kiss my hairy ass.

xyz
Guest
xyz

@chilled: Well blog’s ARE opinion pieces… so read em or not… but I don’t think you need to sling mud on em.. IMHO

Intelligent people can process what they read and discard the crap, others… who cares?

chilled
Member
chilled

@xyz:

“Yet you still read his blog?”

Yes, rarely. It’s tough to be a contrarian in a world of conformists, but what pisses me off more than idiot hypocritical blogging are conformists who migrate en masse to the ‘group think.’ Sorta like THIS blog.

xyz
Guest
xyz

@chilled: Yet you still read his blog?

chilled
Member
chilled
The daily Garth Turner post is proof positive the man is a hypocritical idiot, no, out and out liar. Three or so years of his prognostications, virtually all fundamentally correct yet almost none coming to fruition. From doom and gloom, selling generators and squirrel recipes on his blog to suggesting a slow minor melt is the worst to be expected. Today he is predicting the demise of the teaching profession because of a 20million budget shortfall with the Toronto School Board. (Mr Turner, school boards are virtually the ONLY public entities NOT allowed to run deficits and thus that ‘shortfall’ equates to some of the best money management within the public purse. Unlike the massive deficits and public debt currently serving YOUR pension, you stupid fucking hypocrite and deceitful liar. I’d mail your books I bought from you back, except… Read more »
Bo Xilai
Guest
Bo Xilai

@HipsterBear:

Flow Insurance?

Sounds like a feminine protection product…

Romeo Jordan
Guest
Romeo Jordan

Retirement dreams for many wealthy land holders will be dented in a handful of months and smashed to smithereens in a handful of years.

It’s never different this time. Tattoo that on your forearm McLovin.

Urbain
Member
Urbain

@Turkey: I’m in the area as well and am seeing the same thing. The guttings/renovations are certainly happening, probably with visions of flipping dancing in the owner’s heads. I hadn’t noticed the “California” inspired one listed at 1.5 & change. Looking at the listing, it would be over priced at half that.

Many people in the Strathcona area seem to have been there for some time; that’s just my impression. It almost seems like some of them are floating trial balloons to see what they can get. If they can’t have the early retirement, so be it.