economy, rates

Let’s get negative (interest rates)

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32 Comments

As the economy deteriorates further Canadians are sitting on a pile of cash. Stock portfolios are holding a record $75 billion in cash.

How do you get people spending and investing again?

Well, you could try negative interest rates.

That kinda worked in the EU. Denmark has driven down their currency which has helped exports. Of course the flip side of negative rates is the risk of housing and stock bubbles.

But how would negative rates most likely affect Canadian consumers?   Higher fees.

“What you might see happening is a negative interest rate masquerading as higher fees,” Milevsky said. “No bank in their right mind would tell a consumer, give us your hundred dollars and we’ll give you 95. That will never happen.”

Read the full article here.

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[…] –The bank will pay your mortgage –The illusion of equity –More cutting by Poloz? –Bubbles and crying wolf –The kids are all right –HSBC stops some china US mortgages –Prices up beyond wages – […]

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southseacompany

“What’s Really To Blame For High House Prices In Canada?”, Huffington Post

http://www.huffingtonpost.ca/ben-myers/high-housing-prices-canada_b_9092830.html

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southseacompany

“B.C.’s real estate boost comes with peril, say economists”, Business in Vancouver https://www.biv.com/article/2016/1/bcs-real-estate-boost-comes-peril-say-economists/ “The provincial government needs to do more to calm down the overheated Lower Mainland market, said Tom Davidoff, a professor of economics at UBC’s Sauder School of Business. ” “The government’s preferred response so far, a tax credit for first-time homebuyers for homes up to $500,000, is the opposite of what’s currently needed, he said. In an active market with a lot of demand and limited supply, that policy will drive up prices further.” “The homebuyers’ credit has another risk: it encourages people who might not otherwise be able to afford a home to buy, and that could backfire” ““It’s a possibility that prices will continue to rise forever, that might happen, but there’s another scenario where prices fall 20/30/40% from where they are today,” he said.… Read more »

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Turist

Expensive life or high mortgage?

B.C. Has More Payday Loan Users Than Anywhere In Canada:

http://www.huffingtonpost.ca/2016/01/28/payday-loans-bc_n_9106168.html

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Many Franks

This Province article ought to calm tensions:

Follow the money: Evidence submitted at fraud probe points to concerns about Vancouver real estate market

The end of the article is the most interesting. David Eby has brought some specific allegations to the BCSC and BCREC and is trying to get someone to admit they’re asleep on the job. BCREC doesn’t want to touch it and BCSC isn’t saying much.

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vangrl

Greed & Corruption. What a shit-show this City is becoming

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Turist

Surprisingly how come that spaceFuck didn’t already explain how this absolutely alright transaction in hot markets (like brother Xu said) and how business is usually done back at home so we should all shut it down already and learn from high-rollers how money is made and other crap.

btw. Nice group of people, really lovely neighbors that one would die to live with…

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wwww

Spitting mad with behaviour at Richmond pool

http://www.richmond-news.com/news/spitting-mad-with-behaviour-at-richmond-pool-1.2161453

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history

to get people to deploy their capital the very best thing we can do is layoff Snivel Servants. Bring them in line with the layoffs in the Oil Fields and Mining districts.

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paulb

New
188
Sold
198
TI:7450

http://www.paulboenisch.com

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Tiger

The average price of a detached home in Greater Vancouver in 2005 was about $600,000. In December 2015, it was about $1.65 million, an increase of 175 per cent.

Compare those numbers with Stats Canada data on wages over the closest time period available: In 2003, household income in Vancouver was just under $83,000. Ten years later, it was $100,000, an increase of just 20 per cent.

http://globalnews.ca/news/2482369/90-of-vancouver-homes-now-valued-at-more-than-1-million-research/

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Yunak

Outcome as same as fucking bloody war, decimate the local population and bring other that will fill the pockets along the process…

“As housing becomes more unaffordable, people just aren’t having enough children. What we’re seeing is that that’s having a cascading effect over to our school system. That’s representing a major challenge,” Yan said.

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space889

Not quite, since in a bloody war, scums like you could end up dead.

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Yunak

” In 2003, household income in Vancouver was just under $83,000. Ten years later, it was $100,000, an increase of just 20 per cent.”

100K is amazing household income for Vancouver in 2013. Where do journalists find those numbers?

http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/famil107a-eng.htm

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history

Every bedroom is a wage. Think about it. How many bedrooms, double occupancy, plus the suite in the attic, laneway or basement? Pretty soon you have 5 or 6 tfw adults making $20,000/yr chopping broccoli at the Chinagate buffet.

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Shut It Down Already

In 2005 a 5yr fixed would cost you 6.5-7%. No surprise then that prices could increase out of line with incomes.

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fosolo1

@BBB 2 words : Capital Controls ” Saturday, IMF Managing Director Christine Lagarde signaled her approval of new capital controls in China, so don’t be surprised if Beijing puts them in place in the coming weeks, if not sooner. On the last day of the World Economic Forum in Davos, Bank of Japan Governor Haruhiko Kuroda suggested China clamp down on outbound transfers. “This is my personal view, and it may not be shared by the Chinese authorities,” the head of the Japanese central bank said, “but in this kind of somewhat contradictory situation capital controls could be useful to manage the exchange rate as regards domestic monetary policy in a consistent and appropriate way.” When asked whether she agreed with Kuroda, Lagarde did not reject his surprising proposal. “The massive use of reserves would not be a particularly good… Read more »

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space889

HSBC Halts Mortgage Options To Chinese Nationals Buying U.S. Real Estate

http://www.zerohedge.com/news/2016-01-28/hsbc-halts-mortgage-options-chinese-nationals-buying-us-real-estate

But fear not for all the big banks have scrapped mortgage caps for borrowers with no local credit history.

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VanRant

If the Canadian Big Banks wants to do business in China, they will have to follow the status quo.

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fosolo1

Further clarifies who the target is :

“HSBC bars some Chinese from mortgages. International bank HSBC Holdings PLC will stop providing mortgages to certain Chinese nationals buying properties in the United States, the WSJ’s Mansion Global reports. The move, which was widely circulated on Chinese social media sites over the weekend, may be part of a larger crackdown on money laundering and repatriating assets. HSBC will no longer make mortgage loans to those Chinese nationals holding B visas (the temporary visitors’ visa) if the majority of the national’s income and assets are maintained in China. ”

http://blogs.wsj.com/riskandcompliance/2016/01/26/the-morning-risk-report-safe-harbor-solution-in-doubt/

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Bull! Bull! Bull!

PR is for sale via provincial programs so no prob.

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cat in the hit

fosolo1

wow, there is some news, but the bank has already moved their lend business to money laundry business. Just last week 2 new helicopters were procured for that purpose.

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cat in the hit

fosolo1

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fosolo1

Looks like the squeeze is on :

” Europe’s biggest lender HSBC will no longer provide mortgages to some Chinese nationals who buy real estate in the United States, a policy change that comes as Beijing is battling to stem a swelling crowd of citizens trying to get money out of China.”

http://www.reuters.com/article/us-hsbc-china-mortgages-idUSKCN0V61DT

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cat in the hat

They certainly would if they could. Currently they have about trouble moving down 0.25, monetary policy has hit the wall as is.

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space889

Negative interest rate on bank accounts is already happening in Swiss and some Nordic countries.

And all the major banks are raising fees by a huge chunk, far far far far in excess of inflation rate. Makes you wonder why more people don’t shift their business to credit unions.

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patriotz

“Swiss and some Nordic countries.”

That’s because depositors view these currencies as safer than the Euro or some other currencies.

Now where do you think the loonie would fit into such a ranking?

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Bull! Bull! Bull!

http://www.xe.com/currencycharts/?from=CAD&to=NOK&view=5Y

candian dollar seems to be doing fine versus norwegian kroner.

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Bull! Bull! Bull!

and here we are against denmark.

so patriotz… what’s the answer to your quesiton?

>Now where do you think the loonie would fit into such a ranking?

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Bull! Bull! Bull!

The crazy world of negative rates: Banks pay your mortgage for you?

what a time to be alive!

http://money.cnn.com/2015/04/22/investing/negative-mortgage-rates-europe/

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