etalian posted:

Rime posted:

My e-series have been lovely, though, barely making anything off them. Lost on the Canadian and International ones, in fact.

quote:

Canada’s major banks are heading into a renewed mortgage price war in the wake of the Bank of Canada’s surprise decision to cut interest rates.

Mortgage brokers reported that Royal Bank of Canada dropped its five-year fixed rate for qualified borrowers to 2.84 per cent over the weekend. While smaller, non-bank lenders have started offering even cheaper rates, RBC's rate cut is likely a record for a major bank, said Drew Donaldson, executive vice-president of Safebridge Financial Group. The bank also slashed its posted 10-year fixed rate to 3.84 per cent, the lowest nationally advertised rate in the country, said Robert McLister, founder of Ratespy.com.

RBC spokesman Wojtek Dabrowski said the bank continues to “review the impact of the Bank of Canada’s rate decision,” and that the company’s “individual product lines continue to make pricing adjustments in the regular course of business to ensure we provide competitive rates in the marketplace.”

Bank of Nova Scotia and National Bank of Canada have also cut fixed rates on broker-originated mortgages by 10 to 20 basis points in recent days. Toronto-Dominion Bank said it was dropping its posted 5-year fixed rate on Tuesday to 3.09 per cent, down from 3.29 per cent.

Mortgage officials said RBC was among the last of the major banks to introduce new rate specials.

“National Bank already offers competitive rates over the mortgage rate spectrum as we moved early over the past weeks,” bank spokesman Claude Breton said.

A battle in the mortgage market seemed inevitable given that Government of Canada bond yields have plummeted in recent weeks, falling 57 basis points in the past month to historic lows. Brokers had predicted that falling bond yields were almost certain to drive down the fixed-rate mortgage pricing ahead of the competitive spring housing market even as banks have largely kept their prime rates, which govern variable-rate mortgages along with other types of loans, unchanged. All the major banks will soon be forced to follow the Bank of Canada and cut their prime rates 25 basis points to 2.75 per cent, Mr. Donaldson said. “We expect more cuts to come from all lenders,” he said.

Even ahead of the Bank of Canada’s unexpected rate cut last week, the country’s major banks already seemed poised for a new round of rate cuts this year. Earlier this month, Bank of Montreal chief executive officer Bill Downe told an industry conference the bank was expecting to “again have a fresh offer that is appealing to customers” in the spring. The bank drew the ire of former finance minister Jim Flaherty in 2013 after it dropped its five-year fixed mortgage rate to 2.99 per cent in what Mr. Flaherty called a “race to the bottom.”

The renewed price war is raising concerns that the central bank’s rate cut will add fuel to the country’s overheated housing market even as Canadians struggle under the burden of rising household debt. Canadian Imperial Bank of Commerce deputy chief economist Benjamin Tal warned last week that falling mortgage rates could lead to “a monstrous spring in the real estate market.”

Others argue that low rates may not be enough to kick start a housing market that had already begun to slow toward the end of this year as oil prices plunged. Even as they predicted that Canada’s central bank will cut interest rates a second time later this year, TD economists said Monday they expect Canada’s real estate market to fare poorly this year as cheap crude and sky-high house prices in major cities are making it difficult for new buyers to afford to jump into the market despite low mortgage rates. “The housing market is … projected to be a drag on growth, with changes in existing home sales and prices, as well as housing starts, forecast to tilt into negative territory,” the bank said.

ductonius posted:

When I first got my e-series account I was stuck in +/- 2% mode for a couple of months before things picked up. The value would waffle around and make it supremely agonizing, especially since this was when I checked it every day because I was *so loving excited* to actually be doing something. Now I only log in when I have to place buy orders.

I feel your pain about the Canadian fund. I bought that one in my RRSP account five months ago and it just *now* went positive again. The DJIA being up a poo poo-ton helped make up for it though.

Rime posted:

I can't wait for condopocalypse in about twenty years, and that's being optimistic. Our construction quality is basically a cargo-cult across the board these days.

Bilirubin posted:

A condo tower went up a block away (a metal and glass monstrosity that decided that GOLDENROD AND BABY BLUE was entirely appropriate for a color theme) that has the worst fit and finish of any new building I have seen. And I bet the floor plans are tiny to boot.

Baronjutter posted:

Often it's the only areas where people can afford a house, or it's where they can afford the biggest house. For the same money you can buy a tiny condo downtown, a lovely condo at the edge of town, a run-down house in a nice neighbourhood, or a huge recently built McMansion in a sparkling new up-and-coming new community!

cowofwar posted:

If you have 10-40% in canadian bond funds then you really shouldn't carry any canadian index funds. Just lump it in to an international fund with some or no canadian exposure.

Coxswain Balls posted:

And as close to the city dump as possible. So many seagulls!

Baronjutter posted:

Bilirubin posted:

OK that is shittier but 1) its unfinished 2) its been unfinished for 20 years and 3) its unfinished for 20 years in Caracas so I guess I'm missing your point (unless its your prediction for what downtown Vancouver is going to look like)?

Coxswain Balls posted:

And as close to the city dump as possible. So many seagulls!

quote:

In this guest post, Alex Bellefleur, global macro strategist at Pavilion Global Markets, writes that the Bank of Canada was prudent to loosen monetary policy in response to the decline in oil prices.

Last week the Bank of Canada (BOC) surprised markets by cutting interest rates 25 basis points, leaving them at 0.75%. While some argue this move was unnecessary, we are of the view that the cut is needed as a pre-emptive manoeuvre to counter private sector deleveraging.

Deleveraging processes tend to begin with asset price or income shocks (see: U.S., Spain, Ireland). Canada is currently undergoing an important income shock thanks to the collapse in the oil price, which will probably give way to an asset price shock. If history is any guide, this scenario will trigger a deleveraging process, which will represent a significant structural change for the Canadian economy.

The economy has been going through a quasi-interrupted leverage supercycle since the mid-1990s, aided and fueled by the rise in energy prices over the latter part of this period.

quote:

As we have seen in the U.S. and Europe, an economy can become mired in a liquidity trap when households focus almost exclusively on minimizing debt burdens. Initially, the central bank responds by cutting rates aggressively in order to ease the pain on the deleveraging household sector. This seems to be what the BOC is doing at the moment, pre-emptively, as it would be difficult for the BOC to argue that Canada is somehow different and completely immune to deleveraging pressures following an income/asset price shock.

The other important element in a deleveraging/liquidity trap is fiscal policy, which no one in Canada seems to be talking about at the moment. When interest rates are hovering around the zero lower bound and households are deleveraging, fiscal policy becomes paramount and the economy tends to respond better to fiscal stimulus.

When U.S. real government spending was contracting sharply around 2010-11 amid U.S. private sector deleveraging, the economy was underperforming expectations and Treasuries were rallying. The same movie played out in Europe as fiscal austerity was applied through a general environment of private sector deleveraging, amplifying the recession.

It is interesting to note that growth in Canadian real government spending is currently at its slowest since the mid-1990s period of fiscal consolidation:

quote:

Canadian provinces, which are responsible for health care and education spending, are all dealing with budget pressures. The federal government has also vowed to attain a balanced budget. If fiscal austerity hurt in the U.S. and Europe, it is difficult to see how Canada could remain immune. This is another reason why the rate cut looks appropriate at this juncture.

Let’s say the BOC didn’t cut rates on the basis that it was worried about further inflating the housing bubble. This would amount to what Paul Krugman dubbed “sadomonetarism”, which was applied in Sweden (another small, open economy closely tied to a much bigger one) in 2010-11. The results were disastrous and ended up sending Sweden into outright deflation. The BOC is no doubt aware of the Swedish lesson and wants to prevent this type of situation from happening in Canada.

The rate cut has also been questioned on the basis that the oil price drop would help the country’s manufacturing sector, which would pick up the slack from the resource industry.

One might be tempted to think of the Canadian oil/currency drop as a reallocation of wealth within the country from West to East, or from resource extraction to manufacturing. The problem with that thinking is that manufacturing orders and sales have been weak in recent months, suggesting that it is more difficult than previously thought for Canadian manufacturers to hitch their wagons to a growing U.S. economy.

This is probably due to a competitiveness problem. Canadian productivity growth has lagged the U.S. for years and the country’s export market share has been decimated over the past decade. The link between a resurgent U.S. economy and the Canadian manufacturing sector appears tenuous in the current cycle:

quote:

Another indication of the competitiveness problem is Canada’s current account deficit ex-energy, which remains around 6% of GDP despite the currency depreciation of the past few years:

quote:

In this context, rate cuts to weaken the currency and re-establish some competitiveness make sense.

The lessons of the past few years on deleveraging, premature rate hikes on macro-prudential grounds and loss of competitiveness are too important for the BOC to ignore. This is why the move to cut rates was justified.

Cultural Imperial posted:

The solution is for the motherfucking idiots harper and oliver to stop trying to balance the loving budget

etalian posted:

RBC posted:

This massive condo development in Toronto was just cancelled and is - get this - being replanned as rental apartments: http://www.thestar.com/business/real_estate/2015/01/27/builder-quietly-cancels-condo-complex.html

According to the developers, people want to pay for actually well managed rental apartments, instead of renting a condo from a shady overseas landlord. Who would have thought?

Remember when real estate developers were all crowing about how no new rentals would ever be built without condos? What a load of horse poo poo.

that article posted:

Under the terms of a mutual release and termination agreement that Urbancorp sent to condo buyer Wilk this week, he’ll be repaid $41,085. that’s just $1,085 for three years of interest on his $40,000 deposit.

everyone's parents/coworkers/friends posted:

real estate is a great investment

RBC posted:

According to the developers, people want to pay for actually well managed rental apartments, instead of renting a condo from a shady overseas landlord. Who would have thought?

peter banana posted:

hahahahaha, right near my home and work. It's been a hole in the ground for over 2 years now. itshappening.gif.

Edit: OMFG, hilarious:

RBC posted:

if you really want a laugh read the urbantoronto thread: http://urbantoronto.ca/forum/showthread.php/18032-Kingsclub-Condos(1100-King-W-UrbanCorp-First-Capital-18-14-12s-Tact)/page5

which is full of the typical spoiled UT condo purchasers whining about losing money

neuhaus Senior UT Member posted:

I always knew Urbancorp is a very bad developer -- this really puts them at the bottom of the barrel.
There really should be a revamp of the current condo laws. Developers are getting away with so much and profiting so much at the cost of its buyers.
Having your deposit tied up for so long while property values soars to unprecedented levels and not getting any compensation at all for their lack of responsibility is criminal. I gone through the same thing with another sketchy developer and it makes my blood boil.

Zigmidge posted:

Hey thread, I don't participate because I'm not smart enough but consider this my gift to give a little back to a thread that has entertained and educated me.

http://toronto.craigslist.ca/tor/apa/4865105002.html



The facebook thread I found this in is full of west-enders detailing the neighbourhood as some kind of defense for a bathless one bedroom.

Zigmidge posted:

Hey thread, I don't participate because I'm not smart enough but consider this my gift to give a little back to a thread that has entertained and educated me.

http://toronto.craigslist.ca/tor/apa/4865105002.html



The facebook thread I found this in is full of west-enders detailing the neighbourhood as some kind of defense for a bathless one bedroom.

OSI bean dip posted:

My sister's townhouse complex apparently won't have garbage pickup until the complex is 2/3rds occupied--it is at 1/3rd now. At the moment they have to use a giant construction dumpster for all refuse. I have to wonder how many complexes will be stuck like this.

RBC posted:

? There's clearly a bathroom in those photos. That's a pretty nice place at a typical price.

Zigmidge posted:

Hey thread, I don't participate because I'm not smart enough but consider this my gift to give a little back to a thread that has entertained and educated me.

http://toronto.craigslist.ca/tor/apa/4865105002.html



The facebook thread I found this in is full of west-enders detailing the neighbourhood as some kind of defense for a bathless one bedroom.

RBC posted:

? There's clearly a bathroom in those photos. That's a pretty nice place at a typical price.