economy, Europe, opinion, rates

Mark Carney vs. The Race below Zero

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128 Comments

Mark Carney (why does that name sound familiar?), The Current Head of the Bank of England is speaking out against negative interest rates.

While defending ‘monetary stimulus’ he points out that negative interest rates haven’t done much to improve economies and is instead a game of hot potato where everyone loses:

So negative interest rates are effective in only one way: via the exchange rate – or as he says, “via beggar-thy-neighbor” – which might be “an attractive route to boost activity” for an individual country. “But for the world as a whole,” this “transfer of demand weakness elsewhere is ultimately a zero sum game.

Read the full article over at business insider.

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No Money Down

Just rewatched “How to Change the World”, a documentary about Bob Hunter and the early days of Greenpeace. Some really nice footage of early Greenpeace campaigns, hippies, Jericho Beach, False Creek, West End…

Left me feeling a just little melancholy and what has been lost in this city.

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trackback

[…] offers the new normal –$1 million over asking –Bubbles bursting everywhere –PC city councillor not PC –New York vs Vancouver […]

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ted

My good god isn’t that on lease land. I thought all of the UBC endownment land was leased.

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FEDup

Not on lease land. Not part of endowment lands

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ted

I took another look you are right its on the wrong side of blanca.

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southseacompany

“I see bubbles bursting everywhere: Top academic”, CNBC video

http://www.cnbc.com/2016/03/03/i-see-bubbles-bursting-everywhere-top-academic.html

“Deflationary tides are lapping the shores of countries across the world and financial bubbles are set to burst everywhere, Vikram Mansharamani, a lecturer at Yale University, told CNBC on Thursday.”

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crabman

Perfectly normal, perfectly healthy.
https://mobile.twitter.com/penultsquire/status/705766555234103296/photo/1

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Local Refugee

How city deals with consequences…

Vancouver Needs Mental Health Funding, Not Suicide Fences
http://www.huffingtonpost.ca/davidfine2/burrard-bridge-suicide-fence_b_9371218.html

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would-be buyer

We have to remember that all this insane RE activity at the moment: flipping, shadow flipping and mortgage fraud are all signs of a classic bubble. How any one thinks this is sustainable over the medium-term is drinking some serious kool-aid.

http://www.nbcnews.com/business/real-estate/house-flipping-skyrockets-sparks-concern-over-housing-bubble-n530866

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patriotz

Profits generated by home flipping also hit a 10-year high, with home flippers netting an average $55,000 per sale before renovation and transaction costs. Profits topped $100,000 in expensive markets such as New York and Los Angeles.

That is, these numbers are simply the difference between purchase and sale price. Wouldn’t even be newsworthy in Canada.

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patriotz

And note the oxymoron – if it’s before costs, it’s gross, not net.

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Oracle

Can’t believe that the Caucasians have lost the lower mainland with out a single shot fired.

They have no choice but to keep the housing Ponzi scheme going now. Means millions more immigrants over the next few decades.

This means Vancouver-Richmond-Burnaby will be majority Chinese. Surrey-Langley-Abbotsford will be majority Indian/Philipino.

You guys wait and you will be appalled at the racism your white offspring will experience in the future. Glad my kids will be in the majority.

Your politicians sold you guys out.

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p123

Let’s just say everyone here was completely wrong for the last few years. I wish I bought sooner as well, at least would have been able to sell for a huge windfall. This market has defied rationale for years and looks like it’ll continue to do so for gawd knows how long. If interest rates won’t rise you can expect the market to remain high till interest rates go up, which doesn’t look like it’ll happen anytime soon, as all FEDs are still in QE mode event the US hasn’t risen interest rates again.

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emmi

The US raising interest rates was the worldwide trigger in the 90s under eerily similar circumstances. Took 6 months from the first 25 point increase. So, we’ll see in June or so.

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paulb

New
234
Sold
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TI:8155

http://www.paulboenisch.com

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vangrl

“Still, Tri-City realtors Rod and Rhea Hayes of Park Georgia Realty said they don’t know what country their buyers are from.

“We’ve seen an increase in buyers who don’t speak English and are represented by a translator,” they told The Tri-City News. “We don’t know where they are coming from. They could be Canadian citizens who don’t have all the language skills.”

Glad to see their following FINTRAC guidelines

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vangrl

“they’re”

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voter

They’re driving up price’s in China as well. Shenzen up 50% in one year . There isn’t anyplace that is safe.

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wwwww

It’s HAM. Doesn’t matter if they are citizens, PR, or on a visa. HAM is HAM. It’s been so many years and people still aren’t able to talk about it. This shows that the chances of timely action are near zero.

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I\'m With Stupid V

What the fuck does language have to do with Fintrac?

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vangrl

Realtors are legally obliged to “know their client”. So either these Realtors are full of shit or not following the guidelines that they are supposed to. Think – Money laundering, terrorists etc..

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I\'m With Stupid v

Oh please, a rich American would probably have their assistant acting on their behalf. But of course it’s an issue with the Chinese. Everything’s about money laundering and terrorism to you guys.
So what if you speak to the buyer personally, how the fuck would you know they are clean?

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vangrl

“A Port Coquitlam city councillor says he’s willing to put his reputation on the line to voice his concerns about the amount of foreign wealth coming into the community”

http://www.tricitynews.com/news/off-shore-money-affects-port-coquitlam-real-estate-says-coun-west-1.2189911#sthash.s7Ge0lzT.oTcQJ4lE.dpuf

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Diadora

Like todays CBC World Headline: Massive layoffs coming as China confronts its overbuilt ‘zombie economy’. Thats right folks, China’s economy is built on pure debt…. and thats why there is mad rash to get the money out before it blows up. The suckers are the locals trying to complete with the hot money in RE.

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OpenCourse

Their funding system is flushed with fake “Bills Financing”, aka “bankers’ acceptance”.
It would be a farce if eventually it was to come to light this scheme has been used to speculate in real estate in Australia, Europe and NA.

In the Province’s story on one PG SFD (left to deteriorate currently for sale at 60% above its purchase price 4 years ago), it says the owners bought it “through a property transfer in a Beijing law office”. Does that means they need to produce collateral recognized only by the lending in China?

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OpenCourse

Last sentence should read ~ Does it mean that they need to produce a collateral recognized only by the lending bank in China?”

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patriotz

Any person or business on the planet can be a mortgage lender for a property in Canada on any terms agreed on by the borrower and lender (the exception being that Canadian banks must meet lending regulations). The question is why would they want to.

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Best place on meth

Ripple effect hard at work: Millionaire boomers decamp Vancouver pocketing housing windfalls as city becomes a ‘commodity’

http://www.theprovince.com/business/mortgages/millionaire+boomers+decamp+vancouver+pocketing+housing/11760177/story.html

If there are any retards here still arguing that dirty money from china only affects high end properties in a couple of neighborhoods, please speak up so we can all laugh at you.

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space889

So you are saying those old white west side boomers now become their own locust swarm?

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Best place on meth

I asked for a retard to speak up, and I was amply rewarded.

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Shut It Down Already

Vote Trump!

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Shut It Down Already

You’ve been wrong for a decade yet those who disagree with you are the retards? Uh huh.

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Saul

Still keep spanking the monkey… What a jerk.

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FEDup

Older home on west side just sold for $9mill. 50 by 120 lot. Not a view home.

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patriotz

What’s the address? And don’t tell us you can’t say.

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FEDup

I don’t know but was posted by a realtor pal in fb. Apparently confirmed sold. Over a million over asking.

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FEDup

it should show on the sell shortly. I’m sure Paul B can confirm. I’m not a realtor. (Sadly these days!)

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Diadora

Guess people who owns a property are not millionaires buy mega-millionaires.

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paulb

email me and I’ll get back to you asap. pboenisch@sothebysrealty.ca

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Interesting

At least someone is doing something. Dear Neighbour: Thank you for writing to me about the crisis in Vancouver’s housing market. My office has received an overwhelming amount of correspondence in response to this issue from people all across the province. The sheer volume of letters has meant that I may not have had an opportunity to respond to you personally. But the moving stories we’ve received have convinced me that we need to hold an emergency housing meeting so that we can hear from one another and send out a visual representation of the frustration in our communities across the Lower Mainland, and across the province. As someone who has written, we’re asking for your help to keep the pressure on. We need you to come and show your support to convince the government that this issue is serious,… Read more »

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Diadora

Citizenship revamp: New Canadians no longer have to intend to live in Canada.
In other words, door is open, just launder your dirty money here.

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patriotz

Canadian citizens have a constitutional right to leave the country. Making citizenship conditional on staying in the country violates this right.

There are plenty of ways to deal with illicit money other than attacking citizenship rights of everyone.

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space889

Right, cuz citizenship is no longer a privilege and an obligation to the country anymore. Those archaic ancient concepts. It’s all about how to game the system and cry poor me when the country fail to show up promptly in a nice cruise ship to haul your ass away from an area known for wars. And how can we forget that a Canadian is a Canadian is a Canadian, even if the said Canadian is a determined terrorist.

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Hyper-mega-Bull

this is what you ppl voted for. i know prices are going to keep going up because the people most opposed to HAM don’t even vote according to their own interests.

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space889

Here is a question, a house SFD cost consists of building costs, and land cost. Build costs aren’t really going down cuz labour cost keeps on rising, and we keep getting more and more “green” regulations that really just doesn’t nothing but add costs. So the only things that would go down is materials which isn’t that much in terms of overall costs right now, and land cost. So a Dunbar standard lot is now what? $3M? A 25% crash would still make it above $2M. A 50% crash would make it $1.5M. More affordable if you are a DINK on a $300K/yr household income, which yes, yes, yes I know, every self-respecting bear here is. But not really for say teacher-firefighter, city + provincial employees family. So let’s have a real crash of 75%, that would take land cost… Read more »

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Royce McCutcheon

Gee Space, welcome to the longstanding argument that many have made against putting so many eggs in one basket.

Thanks for your concern, but my household will be fine as I made the decision to seek non-local income a while ago.

But yeah, the big correction that will follow if prices fall anywhere close to back in line with rents or incomes will have massive knock on effects. Most people calling the present situation crazy, reckless, or long-term destructive are very aware of this and it’s one of the reasons they have for opposing the price run-up.

Or you could believe that this was a profound realization on your part.

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space889

Oh right, I forgot…bears are perfect forecasters and would never ever let such a trivial thing like collapsing house prices affect them daily lives or financial wellbeing. What was I thinking? Off course, they would have everything all planned and the only hard choices are how much to low bid, and which homeowers balls are they going to enjoy twisting the most.

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Royce McCutcheon

If I was a perfect forecaster I would have predicted the leaders of this region selling out its future a dozen years ago and plunked every penny I had into Vancouver real estate instead of pursuing higher education and a well-paid career. Also, I have no idea who you are arguing with your response. Seriously – what are you saying? I said that many people who have a problem with the price run-up have a problem with it in part because you are completely right: a meaningful correction will absolutely decimate our economy and lead to a lot of job loss. I said this has been a key argument for a long time. And your response is to talk about perfect forecasting? And you think people have a problem with you here because they’re racist? Dude: before anything else, you’re… Read more »

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space889

Uhm…the bears here have always maintained that they can’t wait for the crash so they can dance on the home owners grave, spit “I told you so” right in their face, really put the screws to the few lucky surviving ones.

And yes, they do also maintain that their forecasts are totally right, and the market crash in 08 just meant they more than double their money since then.

So, it’s a fair question to ask to them what do they think will happen in a crash.

I don’t see why you are so worked up about it.

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elvince

So the minimum wage barista gets laid off because the average VanWester can’t afford 5$ coffee anymore. Big loss? Not as far as the barista is concerned… If tomorrow morning, all lands in the COV magically lost 75% of its price (note that I said price, not value; the value of land is irrelevant to its price), I’d say the construction industry would do quite well (average people could now afford average houses, and so on…) and the most hard hit are the ones who lose their jobs and must sell at the new price. Them and their bankers. Retail and service industry would lose some revenue due to impossibility to get even deeper into debt for some people (car dealerships would lose a lot more than dollarama), and that’s pretty much it. Other than that, the damage would be… Read more »

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space889

So that big US recession back in 08/09 and the ongoing problems in Spain/Ireland aren’t caused by the big housing bust??

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elvince

And I dispute the fact that a DINK couple with 300k$ HH income should buy a 1.5M$ house. 3X income is a lot of debt, and DINKs don’t really need a whole lot of house.

How much is the average HH income in Vancouver anyway? Like 90k$? 300k$/yr in Vancouver is the 1%, or at least close to it. Vancouver isn’t London or New-York.

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space889

Reading this blog & Garth, it seems every RE bear makes 6 figures with at least a mid-6 figures, if not 7 figures, investment portfolio, especially with all those extra savings from rent.

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elvince

Everytime I visit New-York, I have the same thought: It must be great to be rich here, but it must suck a whole lot to be poor.

For Vancouver, it’s slightly different: It’s quite ok if you’re rich (but let’s be honest, it’s not NY, and it’ll never be NY), but it sucks if you’re middle class now. Being middle class in Van is like being poor anywhere else in the country.

it really didn’t take long for vancouver to change from being a great place to live to a really crappy place to live. I just hope the rest of the country doesn’t follow the same path.

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Ulsterman

Agreed. Middle class people are told to go live in the suburbs where they belong, and then they discover a house in Port Coquitlam is still selling for $1m.

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space889

Be thankful that a house / flat isn’t a general marriage pre-requisite for a guy yet.

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patriotz

Marriage itself isn’t a prerequisite for anything here, so a lot of people don’t get married anyway.

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space889

Hmm…I didn’t know most of the local non-Asian women are really only into one night stands, or short term relationships.

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Royce McCutcheon

Wildly missing with an out-of-left-field false-choice non sequitur? Oh my – what a shocking change from your normal posting behavior! Oh wait…

Declines in marriage rates are long standing and well-documented and the opposite of marriage isn’t “one night stands”:
http://well-being.esdc.gc.ca/misme-iowb/.3ndic.1t.4r@-eng.jsp?iid=78#M_1

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space889

If you live together for 1 year and have sexual intercourse, you are considered married. So if people aren’t getting married then they either have long term dating non-cohabiting relationships, or short term relationships. What’s so hard to understand about it?

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Royce McCutcheon

“If you live together for 1 year and have sexual intercourse, you are considered married.”

False. You have a common law spouse. And it’s after two years. And you’re the one who made the crack about one night stands.

And I’ll save you some trouble and post your reply:
“Fail to ever rebut the topic at hand! Something something racist! Something that no one was talking about!”

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space889

Ok, fine I stand corrected, it’s 2 years then. So I guess 18 months relationship wouldn’t be a short term relationship.

But aside from that, what’s the diff between common law and marriage? Aside from a piece of paper you have to pay for, I don’t see any difference between the two.

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patriotz

Well you don’t have to get divorced if either one of you wants to legally marry someone else. That’s a fairly significant difference I think.

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Yunak

Spaceshit, you should just fuck-off and get lost instead of waiting to get banned. Either you are some kind of pervert or the worst sort of racist misogynist? Disgusting!

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space889

Uhm??? When did non-Asian become a race? And when did GRVD non-Asian become a race?

And what do you have against one night stands, or short term relationships? You don’t believe that adults have the right to do agree what kind of relationship they have? Are you some kind of religious nut?

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Hyper-mega-Bull

https://www.youtube.com/watch?v=DtsKcHmceqY

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Yunak

“Bank of Montreal senior economist Sal Guatieri said both Vancouver and Toronto “are likely benefiting from an influx of foreign wealth.”

https://ozonelaundry.files.wordpress.com/2010/02/money-in-washer.jpg

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Confucius

Is that the Challenger?

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Yunak

Lol, a good one.

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ChinaOne

I am banned here but I tell truth. My cousin come and keep buy houses. We no pay tax here. We no work here. We enjoy and buy houses.

That’s all. Why me banned?

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wwwww

>Why me banned?

Because you’re repetitive, not funny, and don’t give any information of value.

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Diadora

Banned?
You are mocking this site and all the readers to it. You are not even Chinese but trying too hard to look like one by using broken english. Get lost. Pope, please ban this idiot right away.

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southseacompany

From the UK: “Seven years of low interest rates have ‘cost savers up to £160bn'”, The Telegraph

http://www.theguardian.com/money/2016/mar/02/low-interest-rates-savers-monetary-policy

“Seven years of quantitative easing (QE) and record low interest rates have cost savers an estimated £160bn, but supported strong increases in the prices of property, stocks and bonds.”

“Hargreaves Lansdown said the average mortgage rate had fallen by 31% over that period, saving borrowers £270 a month on a £200,000 repayment. Access to cheap credit has supported the housing market, leading to a 32% rise in prices over the same period.”

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Piklishi

Why not charge the Chinese a fee for keeping the houses they buy, empty. This will help the city, help the taxpayers and won’t even do a dent to the money laundry buyers. How about a 10k a year to start. Then every year a 20% increase. Something like the carbon tax…
Second for us, the locals with families who pay inflated property taxes, the government should have a property tax break. Also in our favor the rates should be lower. I don’t mind the rates right now. Helping us pay the mortgage faster.
Third I don’t have anything against immigration. It will help the country in a good way.

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wwwww

They lie about everything else, why would they tell the truth about the status of their house? Would you?

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patriotz

The answer is not to try to determine whether the house is “empty” or not, but to make all owners of luxury properties pay a suitable level of income tax.

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space889

Any residential house that isn’t used as a tax file return address gets slapped with a 100% property tax surtax.. Increase property transfer tax by 1% per million for amounts over $1M to $5M or $10M ceiling. Use those extra taxes and do something useful like reducing income taxes, or properly fund desperately translink projects like replacing Portello bridge.

The best part is most of the people you piss either can’t vote, or is a very small minority, it doesn’t really matter. Granted, you will lose campaign funds from the super rich and RE industry. So, the only party that will do something like that would be the NDP. But then people are going to be complaining about how NDP will ruin the economy, raise taxes, etc, etc, etc

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Interesting

Join the discuDear Neighbour: Thank you for writing to me about the crisis in Vancouver’s housing market. My office has received an overwhelming amount of correspondence in response to this issue from people all across the province. The sheer volume of letters has meant that I may not have had an opportunity to respond to you personally. But the moving stories we’ve received have convinced me that we need to hold an emergency housing meeting so that we can hear from one another and send out a visual representation of the frustration in our communities across the Lower Mainland, and across the province. As someone who has written, we’re asking for your help to keep the pressure on. We need you to come and show your support to convince the government that this issue is serious, and that they need… Read more »

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paulb

New
286
Sold
255

TI:8113

http://www.paulboenisch.com

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