Getting out of debt too hard for some

When it comes to getting out of debt, Canadians have the best intentions.

But habits are hard to break.

PWC ran a survey last year where 64% of the people intended to cut their debt levels.

Unfortunately the follow up this year shows that only 23% had any success in doing so, 26% reporting that they were ‘completely unsuccessful’.

Noting that the current debt-to-income ratio sits at more than 160 per cent, the consulting firm called the trend to higher debt levels “unsustainable” for consumers.

“Similar with any diet, saying you’ll cut back and make better choices is one thing, while actually doing it is quite another,” said John MacKinlay, a national financial services consultant at PwC.

“We advise Canadians to take a hard look at their discretionary spending and prepare to make some tough choices on where to trim the fat.”

Read the full article here.

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patriotz
Member

Pope, when I go to the submit page I don’t get a window but “[tdomf_form1]” instead.

Do I have to be logged in the forum as well?

patriotz
Member
Makaya
Member
Makaya
Here is an good piece from the excellent Pragcap blog this morning. NYSE Margin Debt Approaches All-Time High Disaggregation of credit is the understanding that there are good forms of credit and bad forms of credit. A good form of credit is something like a standard business loan in which a company obtains access to a line of credit in order to make investments in the firm. It pays employees, invests in equipment, etc. This form of credit, when issued prudently, is usually productive in that it helps the company expand and it rewards the lender for having taken the risk. As a credit based money system we rely largely on the health of these sorts of loans to keep the system running smoothly. But there are also bad forms of credit. For instance, when a homeowner decides they want… Read more »
Makaya
Member
Makaya
@patriotz This article is pretty chilling… Follow Garth’s advice at your own risk folks! The reason for the short sale is that Mr. Friedberg believes Canada, along with Australia, faces “an incipient housing bust of major proportions.” He’s also of the view that shares of the domestic banks are trading at overvalued levels. Judging by measures such as their market price to book value, Canadian bank stocks appear far dearer than those in the U.S. and Europe. (…) He worries more about a “nightmare scenario” in which the business collapse in southern Europe spreads to still-growing regions, throwing the global economy into a tailspin. This could lead to “generalized country defaults and nationalization of the major banks (wiping out shareholders, debtholders and large depositors) or, alternatively, asset inflation that runs out of control,” prompting tighter monetary policy and higher interest… Read more »
Uncoveredoption
Guest
Uncoveredoption

In Sep 2012, Friedberg shorted 80,000 Netflix in the $54’s.

http://www.friedberg.ca/content/funds/canada/hedge/reports/index.html

Anonymous1
Guest
Anonymous1

Overindebted people will be in trouble when rates rise…If they rise…I don’t thinknthey have the balls to raise them…

So, if rates must rise and they don’t raise them —-> bet against the Canadian dollars. You will make off like a bandit!!

blah-blah-blah
Guest
blah-blah-blah
Good find Uncoveredoption. Based on Friedberg’s track record it’s obvious he can do no wrong. Let’s parse this article: “In one scenario, he sees the world muddling through…” This is the least salacious scenario so let’s ignore this one, even though he actually has a stake in this outcome: “Given the two scenarios, Mr. Friedberg has taken positions that will prosper in the muddle-through outlook, including U.S. home builders and large-cap U.S. companies with strong balance sheets, among others.” “He worries more about a “nightmare scenario,”” ah, this is where it gets more interesting, because fear sells. Short bears are attracted to “nightmare scenarios” like flies to cow dung. But this is just one of his positions, a hedge if you will. It is very unlikely that Mr Friedberg is massively short CDN banks. More likely it is a small… Read more »
patriotz
Member

” this would mean rising interest rates (good for banks) ”

Rising interest rates are bad for banks because their lending terms are longer than their borrowing terms on average.

Falling interest rates are good for banks.

chilled
Member
chilled

As a frequent reader of this and Turner’s blog, I couldn’t possibly be in debt. Being cyber surrounded by so many financial genius’s, quasi-millionaires, gazzillionaires, 25yr olds making +200K/yr, successful day traders, bond traders extraordinaire and so on, how could this NOT rub off on me?!?!?!?! I’m soooooo excited!!! I’m set for life!!!

Boombust
Guest
Boombust

Chilled,

Roger that.

Many Franks
Guest
Active Member
Many Franks
Since we’re talking about web polls, here’s another from Ipsos Reid: The majority (60%) of Canadian homeowners indicate they’ve made some kind of mistake when buying a home, compared to two in five (40%) who say they haven’t. Asked to list up to three mistakes, Canadian homeowners include the need for significant renovations (15%), not having a bigger down payment (14%), and not getting a home inspection (13%). A further one in ten list purchasing too quickly (11%), failing to account for extra costs or total cost of home ownership (10%), making compromises to budget and lifestyle (9%), making an emotional purchase and paying too much (8%), not thinking about future family and space needs (8%), or waiting too long to buy (8%). At the risk of editorializing, my read is “Most Canadian homeowners admit to polling agency that they… Read more »
Makaya
Member
Makaya

“Being cyber surrounded by so many financial genius’s, quasi-millionaires, gazzillionaires, 25yr olds making +200K/yr, successful day traders, bond traders extraordinaire and so on”

That’s so true! as they say in french: “mdr” (mort de rire, chic way of saying “lol”)

I actually believe that a good chunk of his readers are freaked out boomers over-leveraged in Real Estate.

Investing 101
Guest
Investing 101

April 2011 – April 2013: Vancouver detached average: -5%

April 2011 – April 2013: Dow Jones : +15%

Seems like Bull!Bull!Bull! either needs to change his investment strategy or change his name.

gokou3
Guest
gokou3

Re #8:

“Rising interest rates are bad for banks because their lending terms are longer than their borrowing terms on average.

Falling interest rates are good for banks.”

Actually, with mortgage rates so low, a little rise in the interest rate would help the banks make sufficient spreads. Banks in general can handle mildly increasing interest rates quite well.

It’s the sudden drop that trips them over.

Dave#1
Guest
Dave#1

Investing 101 Says:
May 1st, 2013 at 10:07 am 13
April 2011 – April 2013: Vancouver detached average: -5%

April 2011 – April 2013: Dow Jones : +15%

Seems like Bull!Bull!Bull! either needs to change his investment strategy or change his name.

According to Ozzie jurrock from 2 weeks ago on money talks, prices are down 10-17% from peak in 2011(may i think??)Richmond being the 17%

thats for the different areas of greater vancouver

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

@Investing 101 Says

i wonder what’s made more money over the past 3, 5, 10, 15 years. the stock market, or housing. we’ll wait while you look that one up. if you are truly an INVESTOR and not a SPECULATOR it’s clear where the LONG TERM money goes.

patriotz
Member

” if you are truly an INVESTOR and not a SPECULATOR it’s clear where the LONG TERM money goes.”

Into something with positive earnings.

Uncoveredoption
Guest
Uncoveredoption

Friedberg is short about 600,000 shares of the 6 main banks.

The fund has a loss position on those shorts and has also paid out at least $1 million in dividends (dividend cost is about $400k a qtr).

Vote Down The Facts
Guest
Vote Down The Facts

Bull, in the long term the stock market usually wins.

Investing 101
Guest
Investing 101

Hey Bull!Bull!Bull!,

Thanks for waiting. I went and looked up the LONG TERM trends as you advised. It turns out that over the past few decades, the stock market has generally outperformed the real estate market. I won’t link any particular articles because they are simply too numerous. You should be able to find them quite easily as well. Let me know what you think. I will wait.

tyburn gallows
Guest
tyburn gallows

“We advise Canadians to take a hard look at their discretionary spending and prepare to make some tough choices on where to trim the fat.”

ponder on this one folks… get out of debt… or prepare to ‘swing’

Short'em High
Guest
Short'em High
@Uncoveredoption#18. As I pointed out to @bon jovi yesterday, it is expensive to be on offense with a large capital pool. The small investor can turn their position around on a dime but the fund manager has to think about how long it takes to create his position without moving prices too much. On the other hand, seeing a big trader pay out a million bucks in short dividends also tells us this trade will be worthwhile if it hits. SO, on the day of the event, (and factoring out currency risk) one could simply take on a short position denominated in USD against RBC’s NYSE listing. One would do this just as the big traders begin really breaking RBC’s legs. Later, while you enjoy the spoils of conquest, you can watch a blubbering RBC CEO Gord Nixon go on… Read more »
Devore
Member
Devore

“i wonder what’s made more money over the past 3, 5, 10, 15 years. the stock market, or housing”

I don’t know. Or care, because I was not investing 15 or 10 or 5 years ago. But I do care about who will make money in the next 1, 2, 5, 10 years. But especially next 1 year.

Anonymous
Guest
Anonymous

From Yatter

2 year returns from April 2011-April 2013

Detached -4.3%
Attached -4.2%
Apartments -13.6%

Tell me Bull! Bull! Bull! How is this possibly bullish?

Anonymous
Guest
Anonymous

Makaya:

Turners Blog is suspicious at best. Note the letters he gets and shares. No grammatical errors yet zero math knowledge. Oh,…and they ONLY earn $200,000 a year at age 22.

*sigh*

Worst part is most of his readers believe it.

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