Friday Free-for-all! Valentine Edition

What? It’s Friday already?

Seriously?

Well, I guess that means it’s time for another Friday Free-for-all! This is our regular end of the week news round-up and open topic discussion thread for the weekend.

We’ll post some links here, hopefully real soon…

-They’ll go here.

In the meanwhile, what are you seeing out there? Post your news links, thoughts and anecdotes here and have an excellent, love filled passionate weekend!

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crikey
Guest
crikey
” The country’s largest private mortgage insurer says it expects rising losses on its portfolio of Alberta mortgages this year and is more heavily scrutinizing new applications from oil-sensitive region” … ” For the $8.8-billion worth of outstanding Alberta mortgages from the last two years, however, the borrowers tended to have relatively high loan-to-value ratio, with equity averaging just 16 per cent in 2013 and 9 per cent in 2014, due to slow home price appreciation and borrowers paying off less of the principal on their mortgages in those years, the company said.It is also watching the Ontario housing market, where it sees “a modest degree of overvaluation” in prices of single-family home” … “Genworth is focusing on stemming losses in Alberta by more closely examining new applications, looking at whether borrowers will be able to afford their mortgage and… Read more »
Craigster
Guest
Craigster

I spoke with a Bay Street analyst yesterday who predicts a u-shaped recovery for oil over 24-36 months, and that’s what his institution is betting on.They predict the return will be to $85 pricing, ie tar sands will be barely viable. They underwrite a lot of equipment purchases etc on the patch and according to him it’s equipment & plant investment which is going first – the really big lay-offs will happen later this year. Don’t shoot the messenger, this is word-for-word what the guy said…

88
Guest
88
George
Guest
George
Read the Globe and Mail story about the troubles Fort McMurray’s revitalization plans have run into. While Vancouver is busy trying to become the next New York or Paris, who knew Fort McMurray had plans to become the next Vancouver?! “The CCARP is a 96-page document with few concrete details, instead pledging to turn Fort McMurray’s downtown into that of Vancouver or other cities.” I scanned the article. The long and short of it is that the City wanted to revitalize the seedy downtown core with a new sports stadium. There were a bunch of back room deals, city council didn’t know all the details, long time businesses were expropriated and paid top dollar for the land at the peak of the real estate boom. Now there is an entire city block in the middle of Fort McMurray that used… Read more »
Many Franks
Member

Lunar new year hype starts again:
Lunar New Year an occasion that may present real-estate opportunities

The Vancouver Sun rings Bob Rennie’s bell so hard he barely has to open his mouth.

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

while everyone on this blog thinks vancouver is traying to be the next new york or paris vancouver is acctually becoming the next shanghai or beijing.

crabman
Guest
crabman

@5,

“And according to Rennie, many of those homes are owned mortgage free by baby boomers, most of whom will cash out the family home. According to Rennie, there is over $163 billion in mortgage-free property in Greater Vancouver. “This is tax-exempt capital that will flow to new home purchases. These parents will downsize and promptly assist their children with their first-home purchases. Our research shows that up to 40 per cent of first-time homebuyers are relying on assistance from parents or grandparents.””

Congratulations Vancouver, you have become a class-based city!

patriotz
Member

@6: “vancouver is acctually becoming the next shanghai or beijing.”

Now that’s funny. Those cities are actually important.

How about the next Haikou:

http://www.ft.com/intl/cms/s/0/7c957f26-8b9e-11e0-a725-00144feab49a.html#axzz3Re3JtaaD

patriotz
Member

@7:

I have to hand it to Rennie, he has a talent for pointing out things that show Vancouver is in an unsustainable bubble, and making people think they show the opposite.

Oracle
Guest
Oracle

10 year fixed rate approaching 3%

Wow!

Low rate for 10 years mean 33% of your principal is paid off. Assuming inflation of 2% a year, you relative debt will be less than 50% of today’s value.

Wow.

Watch this spring market. One for the record books.

Guy Smiley
Member
Guy Smiley

Don’t worry about Alberta – they still have a robust beef export industry to rely on as oil revenues disappear. What? Mad cow disease? A new round of sanctions by the US, Japan, Korea etc to be expected? Dang.

space889
Guest
space889
Garth post today is about the micro-condo mania in Metro Vancouver. 300 sq ft condos!! Woohoo! To hate the Chinese haters, you can thank your nice civilized British loving HK developers for starting this trend. Welcome to the true Hongcouver. You finally made it to world class now. At this rate, 500 sq ft for 2 people will be considered to be decadent, and utterly disgusting by the eco/green crowd. The weird and funny thing is, it seems like it is mostly the non-Chinese, European heritage locals who seem to go all gaga over the micro-suites. Chinese, especially the rich mainlanders, seem to be more interested in huge mansions. Even foreign students don’t seem to be clamouring for these micro-suites. I’ve read they can apparently be rental investments since on a per sq ft basis, they rent higher than bigger… Read more »
southseacompany
Member
southseacompany

“Shiller warns bond investors: Beware of ‘crash’!”, CNBC

http://www.cnbc.com/id/102421990

“Noting that interest rates (which move inversely to prices) are extremely low given historical norms, Shiller writes: “The U.S. bond market, showing such low yields, looks as it if may have gone through something of a bubble, and may collapse further, eventually.””

“So what’s driving yields so low? Central banks have served a role by buying fixed-income securities, but he says there’s more to it than that.”

“”The story is longer and deeper than that; it’s not just central banks,” Shiller said on Thursday. “It’s something about our investment opportunities and our fears and our culture, so it’s a very deep phenomenon. And the question in my mind is: Will it last?””

“”I think it’s a risky time to be investing in long-term fixed income,” the economist said.”

space889
Guest
space889
@Oracle – Actually I’ve done a break-even analysis taking a higher rate 10yr locked in or a 0.5% to 0.7% cheaper 5 year mortgage, on a pure cash flow basis (ie. cash in, cash out, ignoring inflation), with around 2.9% 5yr and 3.6% 10yr, the mortgage rate actually have to go up over 2% at the 5yr renew time for the 10yr mortgage to come out ahead. If you increase your payments on the 5yr mortgage then the interest rate increase will have to be even higher at 5yr renewal time. I think lower rate would increase the required rate increase even more. However, there are different way to do this analysis since some people like Drachen(?)/Patriotz/etc get hang up on inflation, nominal vs real, etc. But I think for most people and really at the end of the day,… Read more »
space889
Guest
space889

@southseacompany – That’s funny cuz if you read his paid subscription newsletters (I think over $3K/year subscription cost), his Jan 2015 forecast/trading idea issue has buying long term treasury bond as the #1 trade idea. That meant buying 30YR treasury strip which is the biggest duration treasury instrument you can buy with a duration of 30 -> ie. 1% change in rate = ~30% change in price!

In that letter, he told his paid subscribers that he thinks the deleveraging process and low interest rate have a way to go and he expects 10yr UST rate to go 1% or even lower before the bond bull market is over.

You can get access to a condensed version of that letter on John Mauldin’s Outside The Box website archive.

World is awash in Money
Guest
World is awash in Money

S & P 2100!!

Told you guys. It wil go to 2200. Next support. Then 10% correction.

Best place on meth
Member
Best place on meth

#16

NASDAQ is soon going to pass it’s all time high from 15 years ago.

Money is flowing into the US fast and furious, The Chinese and Russians can’t get their money out of their respective shitholes fast enough. Even central banks are buying US equities and making extra gains from the rise in the US dollar.

When the bond bubble bursts this fall and nobody wants to buy government paper for zero return anymore, even more money will go into US stocks.

Garth was right about one thing, don’t bet against America.

southseacompany
Member
southseacompany

“Seller takes big loss on Vancouver Olympic Village condo”, Globe & Mail

http://www.theglobeandmail.com/life/home-and-garden/real-estate/seller-takes-big-loss-on-vancouver-olympic-village-condo/article22988400/

“The seller of this Olympic Village condo paid $1.565-million plus HST in 2010 – a loss of more than half a million dollars, according to selling agent Bryan Yan. “If they got in early, they got burnt,” he says.”

southseacompany
Member
southseacompany

Business in Vancouver:
“Most Vancouverites currently under 45 may be unable to retire: Vancity”
“High cost of living makes it difficult to save for retirement, possibly pushing that goal out of reach”

http://www.biv.com/article/2015/2/most-vancouverites-currently-under-45-may-be-unabl/

“This is a serious problem, according to a Vancity report released February 13, which found that three out of four Vancouverites who are now under the age of 45 may be unable to retire if they don’t change their retirement savings strategies.”

“Many of those surveyed said they plan to rely on CPP and OAS in their retirement years. However, the report points out that these amounts are too low to live on ($7,300 and $6,700 per year, respectively.”

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

remember when bears were saying that a lack of a chinese new year bump was foretelling a crash? lol.

and when did the chinese lunar new year become simply “lunar new year”? there are other lunar calendars. the process of sinofication continues. learn mandarin and borrow money to buy a house while you still can.

kabloona
Member
kabloona

#18 – Love that bit about the OV condo that lost 1/3 of its “value” over 5 years…. but wait, it’s all good!!!

“…The Agent’s Take: “It’s worth $1.225-million right now, but in the next couple of years it will revert back to the $1.5-million price. Within three to four years, it should. It has the water view and people pay heavily for the water view,” Mr. Yan says.

As well, Mr. Yan says, it has the Chinese practice of feng shui on its side. Properties facing water to the north are forecast to have good feng shui in the coming years, he says…”

😉

Dave
Member
Craigster, I think we’ll hit $85 oil again in the next 36 months but I wouldn’t call it a ‘return to $85 oil’ and I wouldn’t call it a U shaped recovery. I think we have entered a new normal for oil because the technology has shifted the supply curve and it’s going to take a very long time for that to change. The marginal cost of producing the last barrel of oil is going to average below $85 in my opinion over the next decade. At this point, I think the new range will be something like $60 to $90 and we’ll probably average on the low end of that for the next 36 months. I think Alberta has a few years of pain coming. My feeling from contacts in the oil patch is that a lot of people… Read more »
Best place on meth
Member
Best place on meth

@21

A good feng schway keeps the ghosts away.

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

to some of us feng schway is a joke. but we live in an chinese city it is now part of our culture.

tax payers in richmond pay for feng shway consultants. i expect vancouver will soon follow.

learn manadrin. don’t waste time on cantonese. it is basically chinese ebonics.

@Dave
Guest
@Dave

Ummm Alberta Oil costs are in Canadian Dollars and sell in USA Dollars.

Oil is at $67 today.

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