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Friday Free-for-all! Oil! Looney! Housing! IMF! Rates!

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Here we are, Friday again!

And you know what that means?

Friday Free-for-all time!

This is our regular end of the week news round up and open topic discussion thread for the weekend.  Here are a few recent links to kick off the chat:

–Housing debate continues
–IMF can’t stop worrying about Canadas bubble
–Hike interest rates in May? not so fast.
–spiking prices, but more affordable
–Cable bills fine, help with the mortgage?
–Canada largest industry is real estate
–Zombie neighborhoods

So what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent weekend!

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Barb Rennie
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Barb Rennie
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There is a saying in Hong Kong – money that goes to Canada is dead money, because that money doesn’t make more money. And even if it did, you have to pay a very high tax. Only money that stays in Asia make serious returns. You only retire to Canada to get free healthcare.

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4 years 10 months ago
Barb Rennie
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This money is legit – therefore it doesn’t have to be stored in Vancouver. It will stay in China-Hong Kong. Only the dirty laundering stuff come here.

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4 years 10 months ago
WOW
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The China-Hong Kong Market went up by 25% in The last thirty days!!

Think about that for a moment.

Many newly minted millionaires.

This money will have to be stored somewhere. Van West?

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4 years 10 months ago
history
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Bo, thanks for the stats on oil …. a combination 2/3rds supply glut, 1/3rd demand destruction. Stick that in your RE pipe, oil field camp janitors ~ … and smoke it..

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4 years 10 months ago
Marco
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@50 Patriotz

Yet the Green party of Vancouver for instance wants to give the agency more power :
• Empower the new Vancouver Affordable Housing Agency (VAHA) to:
• Investigate the effects of global capital on our local housing market. With the growth of luxury home sales fuelled largely by the perception that Vancouver is a “safe” place to invest, consider an incremental tax on luxury housing, to be applied towards the creation of new affordable housing and thereby maintain the social order and livability that make Vancouver a “safe” investment.

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4 years 10 months ago
patriotz
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@49: “Should be deemed redundant because they haven’t taken any steps toward implementing any foreign ownership rules. For obvious reasons.”

The obvious reasons being there is nothing the City can do about it.

Why on earth don’t people who are concerned about foreign ownership make it an issue during provincial elections?

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4 years 10 months ago
Marco
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@19 George

Thanks for the link.

Vancouver’s Affordable Housing Agency is researching how many properties are vacant and will report back to council some time “in the new year.”

Ok then all is good people, nothing to see here.

Isn’t Vancouver’s Affordable Housing Agency an oxymoron, and a waist of taxpayers money. Should be deemed redundant because they haven’t taken any steps toward implementing any foreign ownership rules. For obvious reasons.

Cheers.

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4 years 10 months ago
Bo Xilai
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#43, Dave – According to ABM Amro (via the Telegraph’s Ambrose Evans-Prichard)

“Roughly one third of the current oil slump is a shortfall in expected demand, caused by China’s industrial slowdown and Europe’s austerity trap. The other two thirds are the result of a sudden supply glut, which Saudi Arabia and the Gulf states have so far chosen not to offset by cutting output.”

So it’s a combo of weaker demand and higher production. I’ve also read the Oil & Gas industry is responsible for 2/3rds of USA Capex…

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4 years 10 months ago
Dave
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Even though Russia doesn’t have a vote, they voted for low oil prices too. It’s a simple as asking how much oil are they going to pump. In their case, 100%. That a vote for low oil prices.

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4 years 10 months ago
Dave
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Patriotz, if I posted that the Canadians selected the Conservatives to run the country, you would post back saying that the majority of people didn’t vote for them.

What I said is correct with OPEC because that’s what they voted to do. Just because some in OPEC don’t like the lessor of two bad options, doesn’t mean they didn’t make a choice. Don’t kid yourself, OPEC just voted for low oil prices. All the other talk is noise.

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4 years 10 months ago
patriotz
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@43: ” OPEC wants prices to fall in the short run to cut out some of that investment and future production ”

No, OPEC was unable to agree on a response to falling prices. Iran, Venezuela and some others cannot afford price drops and want production cut back. However Saudia Arabia, which really holds the cards as it’s the only major member that can afford lower prices, wants the price drop as you noted and will maintain production. This forces other producers to maintain production as well as they are forced to sell for whatever price they can get.

Russia is not a member of OPEC but is effectively in the first camp as well.

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4 years 10 months ago
Ted Is WSR's sibling
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Read title.

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4 years 10 months ago
Dave
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I don’t think Alberta money is the driver for Lower Mainland real estate. But, I do think the financial impact of oil and natural gas to our local economy is underestimated. There are a lot of local jobs with connections to the oil patch. I see them all the time. The Okanagan real estate market is very influenced by Alberta money and it’s been pretty quiet since 2009. With the current situation in oil prices, that’s likely to remain the case for quite a while longer. Bo (38), falling oil prices is a good sign for the North American economy. It’s not so good for Alberta and BC though. Prices aren’t falling because of an economic downturn. They are falling because the US is rapidly increasing production by using new technologies and drilling more. OPEC wants prices to fall in… Read more »
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4 years 10 months ago
patriotz
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In December, South Korea will also launch direct trading between the yuan and the won as part of a series of efforts to develop the country into a global yuan hub.

There is already direct trading of the RMB against JPY and UKP among others.

When the recent deal to trade RMB against CAD was announced, the spin was that Canada was leading the world in this. We are actually lagging.

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4 years 10 months ago
patriotz
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@26: “Alberta seemed pretty lively and prosperous at $10 oil when I lived there 15 years ago”

Teranet index for Calgary in 1999 was 70. Most recent is 188.35.

The difference between 1999 and today is back in 1999 nobody had bought houses for 2014 prices. The most recent RE crash had been in the early 1980’s and the effects of that were history.

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4 years 10 months ago
patriotz
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@34:

“Now the US economy is firing on all cylinders with no bogeyman in their banking system.”

All cylinders? Then why are oil prices falling?

The primary cause is the big increase in US oil production. Now is that good or bad for the US?

The secondary cause is the recent discretionary increase in Saudi production, which most analysts think is an attempt to maintain market share. Some also see it as an economic attack on their rival Iran. Other petrostates will see collateral damage – e.g. Russia, Venezuela and thanks to Harper’s priorities, Canada. But don’t worry, Harper’s other priority, RE, will keep us going. 🙁

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4 years 10 months ago
@31
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“the US subprime crisis.” The US subprime crisis was simply a segment of homes market value being lower than the mortgage amount. When people needed to sell for what ever reason they could not pay off the mortgage. That may be due to job loss, divorce, job transfer, need of a larger home, mortgage rate change, mortgage lending tightening, etc. If you think we are not going to see the same ‘crisis’ here when all of the above happens I have a bridge to sell you in Brooklyn. After it takes out the ‘last in’ or weak hands it takes out the next layer and so on. Aka the death spiral circa Vancouver 1981, Japan 1992, USA 2008 and Spain 2009. Once prices start heading down the bottom is a long way down. Anyone with less than 50% equity will… Read more »
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4 years 10 months ago
Bo Xilai
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#31, Jake… I’m pretty sure the whole sub-prime crisis was a manifestation of declining home prices in the US. Foreclosure rates in the US increased in 2006-07, so it’s not like the sub-prime crisis caused the foreclosure rates to rise… They were already rising a few years before then. Sub-prime mortgages were predicated on ever-increasing prices and the ability to get sell a house quickly if you got into trouble.

There’s no bogeyman in the US banking system… yet.

My point is that a collapsing oil price is not a good sign for the economy… Shale oil has been producing for a while, so it’s not a brand new supply source, so if it is on the demand side, then that’s very worrisome. I view oil prices as being a bit of a canary in the proverbial coal mine.

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4 years 10 months ago
tedeastside
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feel bad for all those people who immigrated half way around the world just to be stuck in vancouver and then having see Pictures of California on TV… that has to be torture, i’d kick myself

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4 years 10 months ago
Boombust
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Poor Ted. If that’s his idea of “paradise” he sure doesn’t get out much.

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4 years 10 months ago
@33
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Ted still lives in Vancouver East. He has never been to California. Although he has seen pictures of it.

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4 years 10 months ago
@31
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“Now the US economy is firing on all cylinders with no bogeyman in their banking system.”

All cylinders? Then why are oil prices falling? And why are interest rates still at zero? Those 2 things alone tell a lot of the how the US and world economy are really doing.

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4 years 10 months ago
Boombust
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So, Ted?

Livin’ it up in Gangsta-ville?

Thought so.

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4 years 10 months ago
tedeastside
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its not quite the Superbowl but Grey Cup tickets now going for $49 from the original $288 price ……again organizers underestimate the very low disposable income of vancouverites and high proportion of cheapskates in that poor city

vancouver shows again its the poorest city in Canada

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4 years 10 months ago
Jake
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The difference this time to last time oil prices fell, aside from that they fell $147 to $33, was the US subprime crisis. Now the US economy is firing on all cylinders with no bogeyman in their banking system. Oil falling only helps the economies of America, Europe, Japan & Asia. For instance a third off sale every day at the gas pumps for Vancouverites is the equivalent of an enormous tax break.

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4 years 10 months ago