“Someone with little cash, but a mortgage and investments”

Mortgage and investments are considered savings (or at least payment against the principle on the mortgage is). That Anonymous guy doesn’t know what he’s talking about.

The only controversial issue with “savings” as defined in the personal savings rate is whether asset appreciation should be included before the asset is sold. The government says no and I think that makes sense because most people do not sell at the peak. Our negative savings rate looks bad because it IS bad. If housing truly were the wonder investment that would never fail then the government would be wrong but the fact is most people will see their house’s value drop to equal or less than they paid for it in real dollars. ]]> http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23154 crabman Thu, 24 Jul 2008 15:19:09 +0000 http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23154 <a href="http://www.bcbc.com/Documents/BCEIndexv7n2.pdf" rel="nofollow">BC Economic Index Confirms Economy is Slowing.</a> BC Economic Index Confirms Economy is Slowing. ]]> http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23121 Anonymous Thu, 24 Jul 2008 05:42:07 +0000 http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23121 Almost to 20,000! We're at 19971. 29 units more and we'll hit the big 20K! Almost to 20,000! We’re at 19971. 29 units more and we’ll hit the big 20K! ]]> http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23120 Re-diculous Thu, 24 Jul 2008 05:27:14 +0000 http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23120 Just posted by Paul Inventory: 19,971 ! (20K - 29!) S/L 30% (SFH), 37% (Condo) Just posted by Paul
Inventory: 19,971 ! (20K - 29!)
S/L 30% (SFH), 37% (Condo) ]]> http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23117 Any mouse Thu, 24 Jul 2008 04:59:06 +0000 http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23117 Last two day have been very quite at the Woodwards site. Today it was dead. Last two day have been very quite at the Woodwards site.
Today it was dead. ]]> http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23115 Vansanity Thu, 24 Jul 2008 04:07:48 +0000 http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23115 I drive by Woodwards nearly daily, I don't know about the cranes but there's plenty of activity going on there. I'm pretty sure they sold out those units, ITC is the general contractor and they're big boys, they'll finish it. You can check the progress on their site http://woodwardsdistrict.com they have a live webcam there in case you're interested. I feel sorry for whoever bought there though... maybe not sorry, pity might be a better word. I pity da fool who bought at Woodwards! Welcome to Botswana! I drive by Woodwards nearly daily, I don’t know about the cranes but there’s plenty of activity going on there. I’m pretty sure they sold out those units, ITC is the general contractor and they’re big boys, they’ll finish it. You can check the progress on their site http://woodwardsdistrict.com they have a live webcam there in case you’re interested.

I feel sorry for whoever bought there though… maybe not sorry, pity might be a better word. I pity da fool who bought at Woodwards! Welcome to Botswana!

“British Columbia is probably home to the largest concentration of organised criminal syndicates in the world.” - BBC

http://tinyurl.com/6dvpuy ]]> http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23111 ellery Thu, 24 Jul 2008 02:36:54 +0000 http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23111 "Quotes like this always read as “it’s different this time” to me, and it’s never different this time." That's true. However, if there are ways of putting money aside which are not classified as savings, in the conservative governmental model, but which are counted as assets by the bank, that says something about contemporary attitudes about financial responsibility. Someone with little cash, but a mortgage and investments is hearing from their family and friends that they are being smart. Are they being smart? What is too much risk? The mortgage mess is clearly a part of something much bigger. That's what interests me, and since this thread is on debt, I am bringing it up. If you haven't already heard it, listen to "The Giant Pool of Money" on NPR. It is an interesting summary of the credit crisis, and especially does a good job connecting the everyday people with mortgages and the big lenders. One of their points is that globally, lots of people had liquid cash (ie citizens of China and India whose earnings had been increasing) which needed a home. Alan Greenspan lowered interest rates, meaning that there's not going to be much return for that global pool of money. Mortgage backed securities were traditionally a safe bet, and their ensuing popularity caused financial institutions to push unsafe mortgages (loosen standards) in order to meet the demand of money waiting to be invested. They were creating investment vehicles out of people. The floodgates are opened, and we all feel the effects, and will do for awhile. Vancouver residents still feel very disconnected from this, but are we? http://www.thislife.org/Radio_Episode.aspx?sched=1242 That is the part of the credit crisis that doesn't get as much attention as the people with credit card issues (who I think are popular because we all get to feel superior to them and it's an easy problem to understand). “Quotes like this always read as “it’s different this time” to me, and it’s never different this time.”

That’s true. However, if there are ways of putting money aside which are not classified as savings, in the conservative governmental model, but which are counted as assets by the bank, that says something about contemporary attitudes about financial responsibility. Someone with little cash, but a mortgage and investments is hearing from their family and friends that they are being smart. Are they being smart? What is too much risk? The mortgage mess is clearly a part of something much bigger. That’s what interests me, and since this thread is on debt, I am bringing it up.

If you haven’t already heard it, listen to “The Giant Pool of Money” on NPR. It is an interesting summary of the credit crisis, and especially does a good job connecting the everyday people with mortgages and the big lenders. One of their points is that globally, lots of people had liquid cash (ie citizens of China and India whose earnings had been increasing) which needed a home. Alan Greenspan lowered interest rates, meaning that there’s not going to be much return for that global pool of money. Mortgage backed securities were traditionally a safe bet, and their ensuing popularity caused financial institutions to push unsafe mortgages (loosen standards) in order to meet the demand of money waiting to be invested. They were creating investment vehicles out of people. The floodgates are opened, and we all feel the effects, and will do for awhile. Vancouver residents still feel very disconnected from this, but are we?

http://www.thislife.org/Radio_Episode.aspx?sched=1242

That is the part of the credit crisis that doesn’t get as much attention as the people with credit card issues (who I think are popular because we all get to feel superior to them and it’s an easy problem to understand).

You’re kidding, right? That $1.5T is the notional value of its entire derivatives portfolio, and in practice is roughly evenly split between payables and receivables. You can walk down to Wall Street *today* and buy the whole damn company for ~$120B.

Citi was also bailed out earlier this year, to the tune of roughly $25B. It is not clear whether more bailouts are coming, or if the convertible structure of the bailout is a de facto death spiral. What is clear is that the bailout was from oversees - which combined with Citi’s then-existing ownership means the damn thing doesn’t even qualify as an American company anymore in anything but name. ]]> http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23109 Time Thu, 24 Jul 2008 00:59:42 +0000 http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23109 keep on freaking idiot #112 your math is wrong!if you can pay monthly payment just get in! problem solved! then no matter where the market goes???? you are in for 4sure!!!!Smartguy?actually you are not smartguy unless you are "smart buyer"-got it? keep on freaking idiot #112 your math is wrong!if you can pay monthly payment just get in! problem solved! then no matter where the market goes???? you are in for 4sure!!!!Smartguy?actually you are not smartguy unless you are “smart buyer”-got it? ]]> http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23108 Vanguy Thu, 24 Jul 2008 00:44:13 +0000 http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23108 Anybody paying attention to Woodwards site? I work nearby and I haven't seen the cranes move or anybody work on it for many days. They were doing well putting up glass and they got stalled seven floors from the top. Yesterday, I took Helijet and the cranes were at the same position when I left at 7am and when I got home at 5pm. They have cranes on both the school site and the condo site, and neither seemed to move. Maybe they've moved inside but it sure seems dead. Anybody paying attention to Woodwards site?

I work nearby and I haven’t seen the cranes move or anybody work on it for many days. They were doing well putting up glass and they got stalled seven floors from the top.

Yesterday, I took Helijet and the cranes were at the same position when I left at 7am and when I got home at 5pm. They have cranes on both the school site and the condo site, and neither seemed to move.

Maybe they’ve moved inside but it sure seems dead.

forum/viewtopic.php?f=3&t=48 ]]> http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23103 blueskies Thu, 24 Jul 2008 00:27:50 +0000 http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23103 <i>last year husband walked away</i> satv: did you really walk away and leave her in the lurch... i am disappointed in your cavalier attitude towards parental responsibilities..... last year husband walked away

satv:
did you really walk away and leave her in the lurch…

i am disappointed in your cavalier attitude towards parental responsibilities…..

Not once have you offered anything intelligent.
What is it you’re trying to say?

Are you just trying to derail the blog with stupid, incorrect and incoherent statements? Or do you actually believe you’re contributing here?

Mortgage Debt is a Leveraged Investment but it is still debt.

Assets-Liabilities=Net Worth

Time=freaking idiot

one of this case where low income couple bought a property worth $80,000 five year ago rent for type of suite was around $500 that time,last year husband walked away but this lady is able to manage that appartment despite low income around $1200 per month after tax,$200 child benifit $200 child maintenance this unit is worth around $215,000. in othercase she must pay $1200 rent for similar (765 sq.ft.) unit she own in mount pleasant area while she is paying only $500 mortgage and $165 for maintenance.

I think people who think they are intelligent they should figure out that mortgage debt is not actually a debt but mortgage debt is a kind of spending more to save later,Would We Call Them Progressive Conservatives Yes “buyers in vancouver are smart home buyers”.-denzel washington. ]]> http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23095 Aleks Thu, 24 Jul 2008 00:08:57 +0000 http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23095 <i>“It has been argued that the long-term decline in the savings rate is really just a statistical construct because some types of income, which are becoming increasingly important, are excluded from this measure.”</i> Quotes like this always read as "it's different this time" to me, and it's never different this time. Even in a perpetually rising housing market, it makes no sense to borrow money to spend it on depreciating assets like cars and flatscreen TVs. No matter what your house value does, your debt doesn't go away. Either you never pay off your mortgage, in which case you don't ever really own it, or else you sell and go back to renting. Because in a perpetually rising market it's not just the price of the house you sell that's going up, it's also the house you buy. “It has been argued that the long-term decline in
the savings rate is really just a statistical construct
because some types of income, which are becoming
increasingly important, are excluded from
this measure.”

Quotes like this always read as “it’s different this time” to me, and it’s never different this time. Even in a perpetually rising housing market, it makes no sense to borrow money to spend it on depreciating assets like cars and flatscreen TVs. No matter what your house value does, your debt doesn’t go away. Either you never pay off your mortgage, in which case you don’t ever really own it, or else you sell and go back to renting. Because in a perpetually rising market it’s not just the price of the house you sell that’s going up, it’s also the house you buy.

Male 48 years old - Single, never married, no children, rents mobile home owned by Uncle (cheap rent), owns a 15 year old car (also previously owned by Uncle), 25k in credit card debt, no personal savings, has never owned property. Reason for debt…too many electronics, cd’s, dvd’s and refuses to cook for himself. Eats out several times a day. Now, a restaurant meal out 2 or 3 times a week can cut into a person’s budget, but 2 or 3 meals out everyday is another story and we are not talking McDonald’s here.

Female 32 years old - Single, never married, no children, owns townhouse with minimum down payment, car loan, 10k worth of credit card debt, no savings. Reason for debt…buys things she can’t afford on her salary. Designer clothes, vacations, etc. accumulates on the credit cards and when their is a maintenance problem with the car or the townhouse, she is in crisis mode on how to pay for it.

BTW - I taught the female how to manage her spending better and she got out of debt in 3 years. The 48 year old once again is in a failed relationship, I guess he can’t find a woman to pay off his debts or likes his spending habits?

Also I expect most people are using larger screens or higher resolutions so you can expand the format to eliminate vertical white space and put more stuff on one screen in the side columns.

http://www.cbc.ca/money/story/2008/07/2 … wsuit.html ]]> http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23048 betamax Wed, 23 Jul 2008 18:26:20 +0000 http://vancouvercondo.info/2008/07/the-debt-trap.html#comment-23048 The current situation on the street: A Vancouver repo man was interviewed on the radio yesterday; he said they're run off their feet repo-ing Mercedes, Hummers, and boats of all types. There's a leading indicator for you. As someone in the USA said last year, the repo man is 6 months ahead of a CNN headline. The current situation on the street:

A Vancouver repo man was interviewed on the radio yesterday; he said they’re run off their feet repo-ing Mercedes, Hummers, and boats of all types. There’s a leading indicator for you. As someone in the USA said last year, the repo man is 6 months ahead of a CNN headline.

I wonder how many of these remittances come from people with negative savings rates.

http://tinyurl.com/richimmigrant

…so in effect they are not buying real estate

and another one bites the dust……

“What kind of idiot thinks house prices can keep going up forever without incomes rising?”

Time/satv/krissh/thumsup said:

“prices are in line with Increasing income,low interest rates,rapid rental yeild growth,rich migration,and of course beautiful city”

Moldcity, your question has been answered!