Canada Housing/Debt: Trust me, I'm a landlord.

The Something Awful Forums > Discussion > Debate & Discussion > Canada Housing/Debt: Trust me, I'm a landlord.

flashman: Dec 16, 2003

blah_blah posted:

Yes, that sure is a 'loophole'.

Might as well eliminate the top two federal brackets because who would accept salary rather than bonus for four percent more?

# ? Mar 27, 2015 07:24

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# ? May 21, 2024 15:54

blah_blah: Apr 15, 2006

Ugh, sorry. I forgot the word 'withholding' -- bonuses are withheld at 25% but you owe less or more come tax time (as here, bonuses are just regular income). The government gets approximately the right cut without ridiculous over/under taxing. Obviously, what I wrote would be a massively regressive tax.

# ? Mar 27, 2015 08:31

rhazes: Dec 17, 2006; Reduce the rectal spread!
Use glory holes instead!

An official message from the British Columbia Centre for Disease Control

PT6A posted:

Can you not tell your employer to gently caress off with deductions at source, and then just pay your taxes at the end of the year?

This is probably not a good idea for the average person, because it will require budgeting and forethought, but it's still a possibility.

Sassafras posted:

No, you can't, most large reductions in source deductions require a go-ahead letter from the CRA that you provide your employer*, else they're legally required to treat each pay period as if you earned that amount all year, so a 10,000 bonus on a 3,000 salary paycheque = you get taxed as if you make 312k (24 pay periods) or 338k (26 pay periods) all year.

I suppose you could try to claim you have 50 "infirm" kids, but that probably wouldn't pass muster.

*They give you it in response to a successful request on form T1213, which has fairly limited conditions for approval and all require supporting documentation.

I had nothing withheld in 2014. My tax bill for 2014 is $7400 (haven't filed yet, calculated my T3/T5 information by hand but might wait for the actual slips from Questrade, thankfully I had a bunch of tuition credits and transit credits and stuff, which lowered my owing by ~$2k.) That said, I'm technically a 'casual'/non FT employee in a union. I submitted the form and had nothing withheld because potentially I was going to move/quit (and didn't want to pay taxes as if I was working for the whole year when I might not have.) From what I know of tax law, because I owe >$2000 they are going to make me pay installments next year. Which might be interesting as I will be going into funemployment in August.

# ? Mar 27, 2015 08:43

Lexicon: Jul 29, 2003; I had a beer with Stephen Harper once and now I like him.

jm20 posted:

Incorrect, I don't pay HST on milk (or any of my groceries). If you pay HST on a non prepared food item is it considered non essential.

It was a supply management joke

# ? Mar 27, 2015 09:05

Sassafras: Dec 24, 2004; by Athanatos

Sassafras fucked around with this message at 20:35 on Apr 11, 2015

# ? Mar 27, 2015 09:40

namaste friends: Sep 18, 2004; by Smythe

quote:

Barbara Lawlor is president and CEO of Baker Real Estate Incorporated and an in-demand columnist and speaker. A member of the Baker team since 1993, she oversees the marketing and sales of condominium developments in the GTA and overseas. Keep current with The Baker Blog at blog.bakerrealestate.com

Incredibly, the Bank of Canada cut interest rates in January, and recently, major financial institutions have lowered rates on 5-year fixed mortgages to record lows.

Some news sources are calling it a mortgage rate war, with strong competition for business. This step is having a major impact on our robust spring market for new condominium sales in the Greater Toronto Area. Simply put, homeownership is more attainable with rates like these. It is absolutely amazing that our interest rates here in Canada have reached and maintained such low levels over the past few years. Those of us who lived through decades of two-digit rates appreciate how much the current numbers will save homeowners in the long run. We also understand that anything to do with real estate tends to be cyclical, so assuming that rates will stay this low forever is unwise. At some point, they will rise again, so if you are thinking of purchasing a new condo, my advice is to act sooner rather than later. Acting soon will also mean that you purchase before condominium prices rise again, which is inevitable. Costs for materials and labour continually go up, so of course, the end prices of new homes do as well. Buying early in the marketing cycle also means you get the best prices and the most choice. Buying sooner also means you start earning equity earlier, and in the long run, equity in real estate is a wise investment. If you are thinking long term, of course you have the choice of investing your money in assets such as stocks, bonds and mutual funds. Historically, real estate increases in value over time, and it is, frankly, an investment most people understand. It is bricks-and-mortar tangible. Buying stocks, bonds and mutual funds takes specialized knowledge and/or trusting your decisions to someone else, often a complete stranger, and placing your trust in a lot of unknowns regarding how these companies are run. When it comes to a home or condominium, you see, feel and can live in it — and as I always say, you have to live somewhere. Why pay monthly to rent rather than own? Time and again, home buyers and investors have realized financial gains from owning. Plus, in the GTA, our condominiums have become a welcome source of rental accommodations provided by forward-thinking buyers who understand the law of supply and demand. And whether you purchase to live in or rent out, selecting a new condominium is also a wise choice. With new, you have a few years of Tarion Warranty Coverage to look forward to, as well as knowing that your building is constructed to today’s stringent Ontario Building Code requirements. More energy efficient than ever before, our new buildings offer lower operating costs in the way of utilities, and they leave far less of a carbon footprint than their predecessors of years ago. Resale is important to think of as well. Our modern condos are designed beautifully, with little or no wasted space, and the standard features and finishes are the upgrades of decades ago. They will age well, and with the trend toward neutral wall colours, cabinets and fixtures, their appeal is timeless. Builders are including gorgeous landscaping, amazing amenities and such a variety of styles that there is something for every budget and taste. Own or rent, buy now or later, purchase new or resale, invest in the intangible or the tangible … these are decisions that affect your life for years to come. If you are not financially ready to buy a new home or condo yet, take heart. Even if interest rates rise later this year or next, you will still be far, far ahead of those who purchased during the double-digit years. If you decide that real estate is the best place for your hard-earned dollar and you can afford to buy, now is the perfect time, and new is the perfect choice!

http://m.torontosun.com/2015/03/26/buy-new-and-buy-now

Buying stocks and bonds require specialist knowledge u guyz

# ? Mar 27, 2015 14:20

namaste friends: Sep 18, 2004; by Smythe

http://www.theglobeandmail.com/repo...rticle23640916/

quote:

It�s time to rethink risk-sharing in the mortgage market

anada Mortgage and Housing Corp. (CMHC), the government agency that insures residential mortgages for buyers with less than a 20-per-cent down payment, is a dramatically different animal than it was just a few years ago.

Changes in mortgage insurance rules and a significant reduction in their bulk insurance program (used widely by Canadian lenders to insure conventional loans for the purpose of securitization) have led to CMHC�s total insurance in force declining from a peak of $570-billion in 2012 to $546-billion in its latest quarter. This is a far cry from CMHC�s 11.6-per-cent compound annual growth rate in insurance in force going back to 1990.

Meanwhile, CMHC has recently abandoned some of its more questionable programs, including offering insurance on construction loans to condo developers. I wrote about this program in an op-ed in early 2014:

These changes should be welcome news to taxpayers, who ultimately bear the risk of default on these mortgages should a housing correction render CMHC insolvent. And as an aside, taxpayers also indirectly backstop the �private� mortgage insurers such as Genworth Canada and Canada Guaranty, as in the event of their insolvency the government has agreed to pay future claims on their insurance policies at 90 cents on the dollar. In the last major housing downturn in the 1990s, this scenario played out when Mortgage Insurance Co. of Canada (MICC) was rendered insolvent. Collectively, these private insurers have a total insurance cap of $350-billion.

Yet in spite of these welcome changes, mortgage insurance still creates some odd distortions and, arguably, a big case of moral hazard.

This was driven home this week when I hosted clients in Montreal for a day of meetings with realtors and mortgage brokers where it was learned, among other things, that lenders were tightening guidelines on condo purchases in the city.

This is an entirely rational thing for a lender to do in response to a condo market that has seen MLS inventory rise 44 per cent and sales decline 30 per cent since 2012, consequently leading to the largest ever yearly decline in Montreal�s Teranet House Price Index in February. Clearly, there is more risk in that market and any prudent lender would want to limit their exposure to this risk.

But here�s the catch: The tightening has only applied to uninsured mortgages where buyers put more than 20 per cent down. A year ago, such buyers could purchase with the minimum 20 per cent down, but today, some lenders want 25 per cent down to protect from softening prices.

Note that banks have not changed lending standards on insured mortgages. And why would they? After all, it�s not the lenders themselves who bear the risk on an insured mortgage.

Picture this scenario: A young couple have diligently saved a 20-per-cent down payment on a condo they�d like to purchase in Montreal. They walk into a bank branch and ask for a mortgage, only to be told that they would have to put 25 per cent down since their mortgage wouldn�t qualify for insurance and the lender is not comfortable with the risk involved. But if that same couple opted to put just 5 per cent down, which would qualify them for mortgage insurance, they could be approved with no problems and could even qualify for a 5-per-cent cash-back mortgage to boot. Perverse? Absolutely. Moral hazard? Arguably.

Consumers understand that if they make a claim on an insurance policy, they will need to pay a deductible. This is a practice implemented by the insurance industry to discourage risky behaviour and force people to have a bit of �skin in the game.� Yet in the mortgage insurance world in Canada, lenders do not pay deductibles on claims made when a mortgage goes delinquent.

The solution here is pretty simple in theory (though I recognize the complications it raises for non-balance-sheet lenders such as monolines): If lenders were forced to pay a small deductible on claims, such that they were in first loss position, they would naturally have to apply the same risk management practices on insured loans as they do on their uninsured mortgages. This would go a long way in aligning the best interests of the lenders with those of the taxpayers who ultimately backstop those guarantees.

Ben Rabidoux is president of North Cove Advisors, a market research firm covering Canadian housing, macro and credit trends for institutional investors.

lol gently caress this country

# ? Mar 27, 2015 14:27

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

on the left posted:

Governments really, really don't want citizens to be hit with large lump-sum tax bills. They are hard to collect, and generally turn people into rabid anti-tax advocates. People don't have the discipline to save 20-30%+ of their income all year and turn it over to the government.

Except we already do this for taxes on other sources of income like capital gains, as well as on corporate taxes to some degree (although these, too, may have to be paid in instalments).

Let's face it: the government just wants their money now instead of later. That's really the only reason.

# ? Mar 27, 2015 14:32

rhazes: Dec 17, 2006; Reduce the rectal spread!
Use glory holes instead!

An official message from the British Columbia Centre for Disease Control

Sassafras posted:

Yeah, there is that box on the back of the TD1 labelled: "Check this box if your total income for the year from all employers and payers will be less than your total claim amount on line 13. Your employer or
payer will not deduct tax from your earnings."...

I'm not sure whether you're the least bit likely to get your hand slapped by the CRA for having checked it and then earned a bunch more unexpectedly (you are "required" to submit an updated form when your situation changes), but your employer definitely can get stung on it - especially since they technically knew it was a false declaration once they started paying you beyond that basic amount. (It's a 10-30% penalty of the amount they should have deducted, depending on whether it's the first offence & other factors).

Edit: Some further research shows, per taxtips.ca:
Employees who do not provide their employer with a new completed TD1 form when required may be subject to a penalty of $25 for each day the form is late, with a minimum penalty of $100, and a maximum penalty of $2,500.

My situation could change literally at a day's notice- they don't have to give me 2 weeks notice, severance, etc so how can I estimate my yearly taxes liable based upon that? I'm not on a project that has an estimated end or anything.

I better send in a new form. I checked that box in 2013 because I was under the basic personal amount that year and thought I would be leaving halfway through 2014. But I was never sent a new one nor knew it was required to update CRA until now.

I suppose I should have sent that form in at the start of 2014 and then updated it halfway through. But now I am 100% leaving halfway through 2015... So I'd submit it again?

# ? Mar 27, 2015 14:36

namaste friends: Sep 18, 2004; by Smythe

quote:

Company that owns clothing chains Ricki's, Bootlegger, Cleo to shut some of its 300 stores after being granted creditor protection. #cdnecon

https://twitter.com/CBCAlerts/status/581442587564851200

Rip bootlegger

# ? Mar 27, 2015 15:57

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

Cultural Imperial posted:

Rip bootlegger

What the gently caress are those things? I've neither heard of nor seen any of them, so they must be doing a poo poo job of marketing.

# ? Mar 27, 2015 16:00

Baronjutter: Dec 31, 2007; "Tiny Trains"

PT6A posted:

What the gently caress are those things? I've neither heard of nor seen any of them, so they must be doing a poo poo job of marketing.

I think if you don't go to lovely malls you don't see 90% of these national champion chains.

# ? Mar 27, 2015 16:19

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

Baronjutter posted:

I think if you don't go to lovely malls you don't see 90% of these national champion chains.

What's your criteria for "lovely mall"? Is Chinook Mall in Calgary lovely? What about Southcentre? What about The Core? Those are the only malls in this city that I put up with, and I consider all of them loving terrible on some level.

# ? Mar 27, 2015 16:25

David Corbett: Feb 6, 2008; Courage, my friends; 'tis not too late to build a better world.

PT6A posted:

What's your criteria for "lovely mall"? Is Chinook Mall in Calgary lovely? What about Southcentre? What about The Core? Those are the only malls in this city that I put up with, and I consider all of them loving terrible on some level.

Congratulations for listing what are, by far, the three bougiest malls in Calgary.

( :smithicide:

shopping in this city is terrible)

# ? Mar 27, 2015 16:56

namaste friends: Sep 18, 2004; by Smythe

quote:

We'll have a lot more estimates by end of the day, but economists unanimous on Cdn GDP contracting in Jan, as of now http://twitter.com/LJKawa/status/581490603734802432/photo/1

https://twitter.com/LJKawa/status/581490603734802432

GDP shrinking? Good time to buy a house, before GDP starts growing again.

# ? Mar 27, 2015 17:23

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

David Corbett posted:

Congratulations for listing what are, by far, the three bougiest malls in Calgary.

( shopping in this city is terrible)

The other ones are located in places with even worse traffic and/or are further from me, both traits which I find utterly unacceptable.

I think I have PTSD from trying to find my way out of that horrible "Northlands" place, and one time I tried shopping at Deerfoot Meadows but the layout so confused me that I ended up taking the exit back to Deerfoot by accident simply trying to figure out which of the one-way streets and one-way turns led to the loving Best Buy (I never did figure it out).

# ? Mar 27, 2015 17:26

Baronjutter: Dec 31, 2007; "Tiny Trains"

lol at anyone shopping at a large building surrounded by a lagoon of free surface parking.

GDP shrinking? Time to buy a house! GDP growing? Time to buy a house! It's ALWAYS time to buy.

# ? Mar 27, 2015 18:02

namaste friends: Sep 18, 2004; by Smythe

quote:

Didn't take long - East Van house sells for 35% over asking: $2,167M http://metronews.ca/news/vancouver/1324538/east-van-house-sells-for-record-35-over-asking-price-realtor/ v.@vancouvermetro CC: @Goldiein604 That's #VanRE

https://twitter.com/mtnbvan/status/581514463796289536

Hahahaha holy poo poo

# ? Mar 27, 2015 18:56

Amos Moses: Oct 13, 2012; by Ralp

Albertatalk.

Any idea of what we're looking at for the future here if oil doesn't ever rise again? We've still got rigs running and service side still has some people in the field.
I've never been in Alberta during an oil drop so I'm unsure what to expect. I was laid off and I'm on EI for the remainder of this year as it's kind of really loving hard to find a job right now.

Should I be planning to move?

# ? Mar 27, 2015 19:10

Risky Bisquick: Jan 18, 2008; PLEASE LET ME WRITE YOUR VICTIM IMPACT STATEMENT SO I CAN FURTHER DEMONSTRATE THE CALAMITY THAT IS OUR JUSTICE SYSTEM.; Buglord

Amos Moses posted:

Albertatalk.

Any idea of what we're looking at for the future here if oil doesn't ever rise again? We've still got rigs running and service side still has some people in the field.
I've never been in Alberta during an oil drop so I'm unsure what to expect. I was laid off and I'm on EI for the remainder of this year as it's kind of really loving hard to find a job right now.

Should I be planning to move?

You can move or accept work at McDonalds under the current EI provisions. Honestly, oil will go back up, but it might take a while (months/years)

ed: Actually hold the phone, all the temporary foreign workers will be on the first boat out April 1st. There will be jobs aplenty.

# ? Mar 27, 2015 19:45

apatheticman: May 13, 2003; Wedge Regret

Anyone laid off in Alberta is doubly hosed due to the rumors that all of the big oil companies did their layoffs based on performance reviews.

# ? Mar 27, 2015 19:49

namaste friends: Sep 18, 2004; by Smythe

quote:

Rock-Bottom Rates See Danish Homes Sold in Hours

As central banks across Europe cut interest rates in a battle to keep their currencies competitive against a weak euro, the effects are filtering down to the real economy. Take Denmark, for example, whose central bank cut rates with alarming regularity in a bid to halt its currency marching higher.

There, the residential property market is booming, driven partly by record low interest rates for mortgage borrowers.

Michael Jensen, a 41-year-old sales manager, was outbid on several flats in downtown Copenhagen before he finally landed one late last year.

“I knew I wouldn’t get it for the asking price, so I upped my offer by 200,000 kroner [$29,360],” he said. “I figured it wasn’t that much money per month because of the low interest rates.”

Apartments in Copenhagen that used to be on the market for months now sell in days or even hours, realtors say, while prospective buyers line up early at open houses and squeeze inside along their rivals.

“People will often put in an offer even before they see the apartment,” said Christopher Christiansen, a property broker at Danish real estate agency Home A/S. “Sometimes they will even sign before they see it.”

The country’s property market, especially in the capital, was already hot, because of a shortage of housing and increased urbanization. But the trend has accelerated partly thanks to the ECB’s quantitative easing, which has prompted Denmark’s central bank to cut rates four times this year. The country’s benchmark rate now stands at minus 0.75%, and one-year bank mortgage rates are as low as minus 0.4%. At rates that low, banks would be paying some Danish borrowers to take out a loan if it wasn’t for the fees they charge on top of interest.

“The lower and lower rates and the fact that you can borrow money without it costing you almost anything is of course very important for the housing market in Copenhagen,” said Kasper Bech, a real estate agent at brokerage firm Nybolig.

Danish property prices are still around 10% below their peak in 2006, before the global financial crisis hit the country’s real estate market hard. In recent months, though, prices have soared. Apartments in Denmark jumped 8.2% in the fourth quarter compared to the same period a year earlier, according to Denmark’s statistics agency. In some areas of Copenhagen, property prices are up 30% in a year.

At Denmark’s banks, the volume of new loans has shot up. The average number of loan offers in January and February was around 55,000 compared to a monthly average of around 22,000 in 2014, according to the Association of Danish Mortgage Banks.

The speed of the uptick has raised concerns among some analysts. The central bank last week said low interest rates could be triggering a new housing bubble and urged the government to use tax laws to limit property price growth.

Danish Taxation Minister Benny Engelbrecht said in an email the government is paying close attention to the central bank’s recommendation and developments in the housing market.

Sune Mortensen, head of retail products at Nykredit, one of Denmark’s biggest issuers of mortgage bonds, said bubble fears are overblown. Mr. Mortensen said he’s encouraged that many mortgage borrowers are locking in long-term fixed rates, even if that means they miss out on the best rates in the short term.

”People know [negative rates are] a fantasy, it’s not how it’s supposed to be,” Mr. Mortensen said. ”So they’re actually behaving quite sensibly. We’re seeing more redemptions and more fixed-rate loans.”

But at a wider level, policymakers are worried, with several voicing concerns over how long interest rates can stay low. Denmark is not alone:There’s a clear risk that the U.K., Australian, Canadian, Swedish and Norwegian property markets are also full of froth, based on historic price-to-rent and price-to-earnings valuation metrics.

But while the ECB’s QE program remains in place, central banks remain locked in a difficult balancing act between keeping their economies competitive, and keeping bubbles in check.

-.4% 1 year mortgage. That means you can borrow money and not have to pay it all back.

Also, housing prices are going up in Copenhagen because it's the best place on earth. Everyone wants to move there.

Unironically it's one of my top contenders for relocation.

# ? Mar 27, 2015 19:56

LemonDrizzle: Mar 28, 2012; neoliberal shithead

Cultural Imperial posted:

Unironically it's one of my top contenders for relocation.

Copenhagen is nice but Danish is a terrible accent/language. You'll go mad within a year.

# ? Mar 27, 2015 19:58

etalian: Mar 20, 2006

Alberta to run a 5 billion dollar deficit this year:
http://www.theglobeandmail.com/report-on-business/economy/alberta-spending-big-to-ease-oil-pains/article23649761/

quote:

The province released its 2015-16 budget Thursday, increasing its reliance on debt and taxes to offset the drop in revenue it expects to collect from oil and bitumen royalties. Its debt financing this year is $2.449-billion larger than what the government, in its previous budget, expected it would need when it released its last budget. Alberta is scheduled to run a deficit of $5-billion this year.

quote:

While the Tories did not introduce a sales tax, Albertans will pay more gas tax as of 12:01 a.m. Thursday, hand over cash under the guise of a health-care levy based on income and pay more for cigarettes and alcohol, and the province�s wealthiest will face an increase in income tax. The government, in an attempt to generate more revenue, is raising fees on everything from using the Canmore Nordic Centre to more pricey speeding tickets.

# ? Mar 27, 2015 20:00

Rime: Nov 2, 2011; by Games Forum

jm20 posted:

ed: Actually hold the phone, all the temporary foreign workers will be on the first boat out April 1st. There will be jobs aplenty.

Source? After reading about them jumping around jobs willy-nilly in flagrant violation of how the system works I have no faith that the government will actually enforce a mass deportation of that nature.

# ? Mar 27, 2015 20:01

Amos Moses: Oct 13, 2012; by Ralp

apatheticman posted:

Anyone laid off in Alberta is doubly hosed due to the rumors that all of the big oil companies did their layoffs based on performance reviews.

Thank the lord I didn't work for an oil company.

I'm at the max rate for EI, McDicks would probably net me less income per pay period. I'm not seeing an incentive to go work there. $800-900ish every two weeks v.s. $1048 biweekly EI seems dumb.

I'm not completely sure what we're going to do come April 1st when the TFWs get sent home. As far as I can tell all the fast food places/hotels/Tims/Retail stores are 80%-95% TFWs right now.

Land management companies are fighting tooth and nail to keep tenants, slashing rent and offering incentives out the rear end. There's probably uh, 10? or so large modern apartment buildings still being built currently. It's becoming awesome to rent here now. One of the newer multi-building complexes went from $1750/m to $1150 for a 3 Bedroom + 1/4 of a months rent for the DD and a year of basic cable + internet on a 1 year lease.

# ? Mar 27, 2015 20:07

Risky Bisquick: Jan 18, 2008; PLEASE LET ME WRITE YOUR VICTIM IMPACT STATEMENT SO I CAN FURTHER DEMONSTRATE THE CALAMITY THAT IS OUR JUSTICE SYSTEM.; Buglord

Rime posted:

Source? After reading about them jumping around jobs willy-nilly in flagrant violation of how the system works I have no faith that the government will actually enforce a mass deportation of that nature.

http://www.cbc.ca/news/canada/windsor/temporary-foreign-worker-mass-exodus-expected-april-1-1.2970833

# ? Mar 27, 2015 21:21

Rime: Nov 2, 2011; by Games Forum

quote:

Fernandes said she has one client who has worked 17 years in Canada and must now leave for four years before being able to apply again.

Hahahaha, how can they promote literal slavery with a straight face like that. _{Our society is so broken good christ.} :smith:

# ? Mar 27, 2015 21:26

Amos Moses: Oct 13, 2012; by Ralp

jm20 posted:

http://www.cbc.ca/news/canada/windsor/temporary-foreign-worker-mass-exodus-expected-april-1-1.2970833

I wonder how many are just going to go into hiding and work for lesser amounts off the books.

There was a big to do about TFWs on LMOs here last year after some guy on an LMO for Taco Time somehow bullshitted his way into a job at a lumber yard. I guess the LMO said he could ONLY work for Taco Time.
There's something weird about going to Taco Time and being served by actual mexicans though.

# ? Mar 27, 2015 21:38

Seat Safety Switch: May 27, 2008; MY RELIGION IS THE SMALL BLOCK V8 AND COMMANDMENTS ONE THROUGH TEN ARE NEVER LIFT.; Pillbug

David Corbett posted:

Congratulations for listing what are, by far, the three bougiest malls in Calgary.

( shopping in this city is terrible)

Eh, Market Mall seemingly deliberately doesn't have very good public transit.

# ? Mar 27, 2015 21:45

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

Alberta cigar tax up $0.75 to $7.03/cigar, or 116%, whichever is lower.

Fist gently caress Prentice in the rear end.

# ? Mar 28, 2015 00:27

Lexicon: Jul 29, 2003; I had a beer with Stephen Harper once and now I like him.

PT6A posted:

Alberta cigar tax up $0.75 to $7.03/cigar, or 116%, whichever is lower.

Fist gently caress Prentice in the rear end.

Jeez, just light it with a lower denomination bill - problem solved.

# ? Mar 28, 2015 00:38

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

Lexicon posted:

Jeez, just light it with a lower denomination bill - problem solved.

Except it'll be $3-4 more at retail because PTT is applied at wholesale. It's bullshit.

# ? Mar 28, 2015 00:46

namaste friends: Sep 18, 2004; by Smythe

http://www.theglobeandmail.com/report-on-business/rob-magazine/the-great-central-bank-freak-out-of-2015/article23613669/

quote:

Raghuram Rajan got it started. On Jan. 15, the governor of the Reserve Bank of India jolted traders on Mumbai�s Dalal Street by cutting interest rates. The surprise was the timing of the announcement: Rajan wasn�t supposed to deliver a policy statement for another 19 days.

The weirdness continued that same day�in Switzerland, of all places. For three years, the Swiss National Bank had steadily bought euros on currency markets to keep the country�s franc from surging in value relative to the euro, and thereby choking off growth. Unorthodox, yes; but global financial markets had grown accustomed to the regular renewal of the bank�s stance. Without warning, however, the Swiss cut the franc�s tether. Swiss National Bank chairman Thomas Jordan also set the benchmark Swiss lending rate at negative 0.75%. In theory, a lower rate should put downward pressure on the franc; not enough in this case, as the franc�s value shot up by 18% in the days that followed. Many hedge funds bled red.

And on it went. The Danes cut interest rates four times in the span of a few weeks. As this issue of the magazine neared deadline, China�s central bank cut rates by a quarter of a percentage point and Poland slashed them by a half point. In the first 60 days of 2015, some 20 central banks had executed stimulus measures.

Let�s call it the Great Central Bank Freak-Out of 2015.

The scale and breadth of intervention is reminiscent of the central bankers� manoeuvres during the 2008-09 financial crisis, with one big difference: There is no obvious emergency this time.

The central bankers who acted so boldly in the Great Recession say they are now responding to the startling collapse in oil prices. But since when was cheaper gasoline such a bad thing? The central bankers reply that, when you combine the plunging cost of energy with stagnant growth in major economies such as Europe and Japan, deflation has emerged as the clear and present danger.

Into this frenzy stepped Stephen Poloz. The Bank of Canada governor had the decency, at least, to wait until his regularly scheduled interest rate policy announcement on Jan. 21. The bank�s benchmark rate had been set at 1% for more than four years, put in place by Poloz�s predecessor, Mark Carney. Everyone assumed it would stay there. But Poloz shocked Canadian markets with a quarter-point cut. He called it �insurance� against the economic blowback from the fall in oil prices. The deterioration of wealth, he said, would be �unambiguously negative for the Canadian economy.�

Poloz�s counterparts all have similar explanations: Central banks are hard-wired to fight inflation or deflation, so what else are they supposed to do? But what if the world�s central banks have developed a hero complex? Cheaper money works by tickling our greed. It tempts us to borrow, spend and invest.

That is what makes economies go around. The thing is, there is an emotion that trumps greed: fear.

The Bank of Canada was by no means enthusiastic about the Canadian economy�s prospects at the end of 2014. Poloz made a point of underlining his dissatisfaction with the high number of Canadians who were either looking for work or in need of more hours. Still, things seemed to be crawling in the right direction. A weaker loonie and stronger economic growth in the United States looked likely to give exporters a lift. Statistics Canada confirmed in March that real gross domestic product grew at an annual rate of 2.4% in the last quarter of 2014, faster than the central bank reckons the economy can grow without eventually stoking inflation.

The bet on Bay Street at the end of last year was that Poloz would leave the benchmark rate unchanged for most of 2015 before starting a gradual trek back to higher rates. Growth conditions aside, the Bank of Canada was also clearly worried that Canadians were borrowing their way to a new financial crisis. In its policy announcement last Dec. 3, the bank noted that �household imbalances��which is how it describes the country�s record debt load��present a significant risk to financial stability.� The implication: Higher interest rates eventually would be needed to wean Canadians off their credit habit.

Seven weeks later, Poloz decided there was a more significant risk facing the Canadian economy than mass foreclosures. At a news conference on Jan. 21, Poloz explained that the sharp drop in oil prices at the end of 2014 was proving to be far worse than expected. By convention, the bank bases its forecasts on the current price of oil. In October, the cost of Western Canada Select was about $70 (U.S.) a barrel. When policy makers gathered to rethink policy in January, WCS had been stuck below $40 (U.S.) a barrel for weeks, which is nowhere near enough to cover the cost of extracting oil from sand in Northern Alberta. The bank has seen oil shocks before. Their statistical models gave them a good idea of where things were headed. Thousands of Canadians were facing certain unemployment. Oil companies already were scrapping plans to expand production, triggering a broader decline that would rob factories of orders and consultants of service contracts. There would be pain.

The bank focuses on something called the �output gap� to tell it how close or far it is from hitting its inflation target. The gap is the difference between actual GDP and the level of production the bank thinks the economy can manage before inflation accelerates too quickly. The goal is to get as close to the red line as possible. Last fall, the gap was narrowing. In January, it was getting wider.

Hence the rate cut, according to Carolyn Wilkins, senior deputy governor of the Bank of Canada. �That�s why we decided to take out the insurance that we did, by cutting the rate, so that we could increase the chances that our projection, which is that we�ll close the output gap by the end of 2016, will actually occur,� Wilkins told me in late February, just before she and the other members of the bank�s Governing Council went into a customary week-long blackout period ahead of the March 4 policy announcement. (In that announcement, Poloz left the overnight target unchanged. More on that later.) �Certainly from our point of view, doing the right thing with respect to monetary policy is the best way to maintain our credibility, because we�ll be more likely to achieve our inflation target, but also that credibility should be something that underpins confidence.�

Plenty of other experts disagree. Paul Masson, an adjunct professor at the University of Toronto�s Rotman School of Management and a former adviser at Canada�s central bank, says Poloz�s notion of insurance was akin to unloading the cannons at the first sight of the enemy�s flag. ��Taking out insurance� can take many forms, such as keeping your powder dry until it is needed,� he says.

The chief executive of a Canadian company, who requested anonymity in order to speak freely, says he thought Canada�s economic leaders were asleep at the switch. �My impression was that the Bank of Canada and the government were totally unprepared for a major correction in oil prices,� the executive says. �They have been fixated on Canada as a petro-country and nothing more. Their reaction didn�t seem to appreciate how volatile the Canadian dollar was and the violent correction will also have negative ripple effects.�

The little-talked-about problem in-herent in this rush to the barricades by central bankers is that it sent a massive signal that we have reason to be fearful. �Who then would be bold enough to make a long-term commitment in such an environment?� wonders Stephen Lewis, an economist with ADM Investor Services International Ltd. in London.

Central bankers don�t necessarily care about what the Lewises of the world have to say. The City of London and Wall Street types have been hurling those sorts of barbs for years. But what if the people who run millions of businesses�large and small, global and local�are rattled?

The bank needs to keep the confidence of entrepreneurs like Mark Hanna, a partner at Montreal-based Leeza Surfaces Inc., which supplies stylish, high-end countertops. The company is headquartered just north of Pierre Elliott Trudeau International Airport, and has warehouses in Toronto, Vancouver and Connecticut. I first met Hanna at a forum for entrepreneurs in Ottawa in August, 2009, near the end of the Great Recession. He was weathering the crisis well, and he was optimistic.

But when I contacted Hanna this past February, after Poloz�s surprise rate reduction, he was spooked. �The cut in rates, to me, suggests desperation,� he said. �This does not instill confidence when I think about our economy.� The trouble for central bankers is that there are lots of Mark Hannas out there�in every industrialized country. He is an honest-to-goodness economic actor: a hirer of people, a customer for loans. He is the kind of person the central banks are trying to help, yet they�ve shaken his desire to expand his business. So why the Great Freak-Out?

In the old days, central bankers tried to avoid volatility�or creating excitement of any kind, really. They were the stoic guardians of our economies, detached from the fickle political calculations of governments and immune from the base profit motives that drive corporate leaders. Alan Greenspan, who was chairman of the U.S. Federal Reserve from 1987 to 2006, was the archetype of the abstruse central banker. His long, elliptical responses to questions from U.S. legislators, delivered in a monotone, were quite deliberately opaque. �I should warn you,� he once joked, �if I turn out to be particularly clear, you�ve probably misunderstood what I�ve said.�

Yet Greenspan, oddly, was easy to read when it came to what the markets cared about most. He liked to adjust interest rates in predictable, quarter-point increments, so when he started down a path, investors and traders knew where they were headed. The Greenspan years came to be known as the Great Moderation.

There was nothing moderate about monetary policy during the financial crisis and its aftermath. Ben Bernanke, Greenspan�s successor, and the heads of the rest of the world�s major central banks, acted boldly and massively. They slashed interest rates�to 1% in the euro zone, and near 0% in the United States and Japan. The Fed, the Bank of England and the Bank of Japan also launched huge quantitative easing programs that lasted for years�essentially creating hundreds of billions of dollars worth of currency to buy government bonds and other debt securities, thereby injecting cash into banks that could be loaned to businesses and consumers.

The politicians did their part, too�at first. They ran massive budget deficits to stave off another Great Depression. Even Canada�s resolutely tight-fisted Conservatives cranked up infrastructure spending and racked up a $56-billion deficit in the 2009-2010 fiscal year, and a $33-billion shortfall in 2010-2011. But since then, to varying degrees, governments have shifted back to austerity. The Group of 20 got out the fire hose when the world was on fire, but they didn�t stick around for the rebuild.

That austerity is now an anchor on growth. The U.S. recovery has picked up momentum over the past year�in part because state and local governments are spending again�but the American economy is the exception. Even growth in China is slowing. Japan remains mired in a slump that, in many respects, has lasted since the 1990s. Much of Europe is flirting with deflation and a triple-dip recession.

In contrast to governments, the central bankers have kept stimulating since the financial crisis. Denmark pioneered the use of negative interest rates in July, 2012, when its central bank lowered the deposit rate on funds it holds for commercial banks to -0.2%, to encourage those banks to loan the money instead of hanging onto it.

All along, of course, many analysts have questioned how effective the low, low rates and all that E-Z money have been. Some argue that the central bankers have done little more than fuel asset price bubbles, lining the pockets of the well-to-do, but few others. The U.S. stock market has almost tripled since the bottom in 2009. Apartments in New York have cracked the $100-million barrier, and in London, they�ve soared beyond $200 million�asking prices, at least.

Closer to home, average prices for a detached house in Vancouver or Toronto have soared above $1 million. The University of Toronto�s Masson wrote a paper in 2013 that pleaded with Carney to raise interest rates. He says that Canada�s lacklustre economic growth since then hasn�t caused him to change his mind. A massive run-up of debt caused the financial crisis. History could be repeating itself.

Central banks understand the risks. They simply are unwilling to put theoretical concerns ahead of a threat that is staring them in the face. Deflationary pressures last fall pulled the big central banks in various directions. After injecting more than $3.5 trillion (U.S.) into the U.S. economy following the financial crisis, the Fed ended its regular monthly purchases of bonds and mortgage-based securities in October. That was the Fed�s nod to those who accuse it of sowing the seeds of the next crisis. But Janet Yellen, who replaced Bernanke in February, refused to signal when she might raise the official rate from zero. In September, Mario Draghi, president of the European Central Bank, lowered the ECB�s benchmark rate by 10 basis points to 0.05%, and its deposit rate to -0.2%. He also promised that the ECB would soon unveil a massive QE program of its own.

Then, another wild card began creating more headaches for central bankers.

A week before Poloz�s dramatic interest rate announcement, Timothy Lane, one of four deputy governors of the Bank of Canada who sit with Poloz and Wilkins on its Governing Council, gave a speech at the University of Wisconsin in Madison. The title was clear enough: �Drilling Down�Understanding Oil Prices and Their Economic Impact.� The text was released online and, toward the end, Lane declared that lower oil prices would be �bad for Canada.�

If that was meant as a warning, most analysts and commentators missed it. The bank rarely sent messages via its deputies, so few�if any�market participants would have been giving Lane their full attention.

Besides, there were no other reasons to expect any surprises.

After Poloz succeeded Mark Carney in June, 2013, he made a point of easing his way into his new role at the centre of the Canadian economy. He kept the bank�s benchmark rate at the 1% set in September, 2010, allowing the memory of Carney�s dramatic moves during the financial crisis to fade away. No more adventures in monetary policy�Poloz was fond of telling audiences that the time had come to let �Mother Nature� do her work.

No wonder Poloz sounded almost apologetic when he met with reporters after his rate cut. �We generally prefer that markets not be surprised by what we do,� he said. �We took comfort from the observation that the consequences of the drop in oil prices appear to be well understood, and that the possibility of a rate cut had begun to enter markets in the last couple of weeks.� Or maybe it didn�t. The Canadian dollar plunged by more than 1.5 cents (U.S.) that day, closing at 81.07 cents, its lowest level since April, 2009.

The Bank of Canada�s leaders are clearly sensitive to the possibility that monetary policy could actually undermine confidence, rather than bolster it. But in January, they decided to risk it. Wilkins insists that they knew what they were doing. A quarter-point interest rate adjustment is the type of fine-tuning that the bank used to do all the time. �It�s a bit of a stretch to say that a 25-basis-point cut in a policy rate is a panic reaction to a 57% decline in oil prices since last June,� she said.

That oil price collapse is more of a problem for Poloz than it is for central bankers in Europe and Asia. All of the bankers are worried about the deflationary impact on consumer prices. Poloz also has to contend with the impact on output and employment in the Alberta oil patch, and on the companies that supply and finance it.

In some ways, Poloz�s job is much trickier than Carney�s was during the financial crisis. Carney had the aid of Jim Flaherty�s expansionary fiscal policy, but now the Harper government is determined to balance the books before the election this fall. On the day that Poloz cut interest rates, Finance Minister Joe Oliver said there was no need for a matching response from him. �We think it�s wrong to burden our children, our grandchildren with expenditures that we�re incurring today, so we think a balanced budget is important and we�re going to achieve it,� he said in a broadcast interview with CNBC at the World Economic Forum in Davos.

Oliver would be correct if it still was the 1990s, when Canada was facing a debt crisis. Now, Canada is one of the few countries with a triple-A credit rating. The federal deficit is so narrow�less than 0.5% of GDP�that it hardly matters whether the government balances it or not.

The provincial premiers aren�t helping Poloz much, either. Bank of Canada economists estimate that the total portion of GDP growth this year attributable to all levels of government will be 0.2 percentage points. In 2006, that figure was 0.8 percentage points. I asked Wilkins if the January interest-rate cut would have been necessary if current government spending was at pre-crisis levels. She dodged the question. �We take fiscal policy as a given,� Wilkins said.

Compared to what the ECB�s Draghi announced on Jan. 22, Poloz�s rate cut looked like a blip. Draghi unveiled a �1.1-trillion quantitative easing plan that would have the ECB co-ordinate purchases of �60-billion worth of securities a month until September, 2016. Investors were ready for QE, but not on that scale. Britain�s Guardian newspaper described it as �shock and awe.� The plan kicked the Great Freak-Out into the stratosphere.

In many countries, official interest rates are now lower than they were during the financial crisis. The Danes, the Swiss, the ECB and the Swedes all are experimenting with negative interest rates. In effect, they are challenging hedge funds and banks to find more productive uses for their money than financial speculation.

At least some investors are encouraged. U.S. and Indian equity markets have scaled new heights this winter. �The accommodation should result in a positive wealth effect via higher equities and bonds,� Ankur Patel, chief investment officer at R-Squared Macro, an investment firm based in Birmingham, Alabama, told me. �These co-ordinated global rate cuts, zero-interest-rate policy, and QE may be what ultimately provides a net positive boost to confidence.�

Yet the usual doomsayers and conspiracy theorists�and the Internet is full of them�are predicting disaster: We are headed for a devastating global currency war, reminiscent of the 1930s, when central banks slashed exchange rates in an attempt to ignite their countries� exports. But when those competitive devaluations were combined with beggar-thy-neighbour trade restrictions, they only aggravated the Great Depression by reducing global demand for goods and services.

The suggestion that central banks are trying to beggar one another like they did in the Great Depression is highly debatable. Yes, the exchange rate is one of the channels through which a central bank influences inflation. And when interest rates shift, capital diverts to countries that offer the highest return. With so little demand in many countries to offset the upward pressure on exchange rates, they have little choice but to keep lowering rates in order to hit their inflation targets. The adjustment is more mechanical than predatory. �It is not so much a currency war, or anything malicious, but the mere fact of lack of co-ordination,� says Vivek Dehejia, an economics professor at Carleton University who currently is working on a research project in Mumbai.

Dehejia has a point. The world�s central bankers this winter looked like soldiers awakened in the middle of the night to fight an unknown enemy. If there was no grave emergency, then surely someone should have said so. But who? That was part of the problem. There is no one.

The most powerful central banker in the world is Janet Yellen. She has a reputation as a communicator. Yet the Fed�s messages have been anything but clear.

This past February, Yellen tried to cool speculation that the Fed�s policy committee would raise the target range of its benchmark rate�now between zero and 0.25%�any time soon, or even hint that it would. �If economic conditions continue to improve, as the committee anticipates, the committee will at some point begin considering an increase in the target range for the federal funds rate on a meeting-by-meeting basis,� she said. �Before then, the committee will change its forward guidance. However, it is important to emphasize that a modification of the forward guidance should not be read as indicating that the committee will necessarily increase the target range in a couple of meetings.�

She sounded like Alan Greenspan.

In theory, negative interest rates and years and years of ultralow interest rates should work just fine. Unless, of course, executives and investors look at a negative interest rate and decide nothing good can come of a policy that appears to defy reason.

Ben Bernanke always warned that monetary policy wasn�t a panacea. We finally may be witnessing what he meant. After the scramble of January and February, the weeks and months ahead will determine whether monetary policy still has any pop.

Which brings us to the Bank of Canada�s most recent interest rate announcement. On March 4, Poloz performed another stunner�this time by doing nothing. Financial markets had priced in another rate reduction. There was grumbling about Poloz sending mixed signals. There is a real risk that central bankers could be losing the public trust. And if that is true, they just made things worse.

tl;dr Stephen Poloz sez

# ? Mar 28, 2015 01:35

Kafka Esq.: Jan 1, 2005; "If you ever even think about calling me anything but 'The Crab' I will go so fucking crab on your ass you won't even see what crab'd your crab" -The Crab(TM)

PT6A posted:

Alberta cigar tax up $0.75 to $7.03/cigar, or 116%, whichever is lower.

Fist gently caress Prentice in the rear end.

Anybody smoking cigars regularly can afford trips to Cuba and a humidor.

# ? Mar 28, 2015 02:05

PT6A: Jan 5, 2006; Public school teachers are callous dictators who won't lift a finger to stop children from peeing in my plane

Kafka Esq. posted:

Anybody smoking cigars regularly can afford trips to Cuba and a humidor.

Indeed. It's now reached the point that it's cheaper to go down for 48 hours and bring back duty-free.

Does that seem like the result of good policy? I can accept some level of tobacco tax, but it's becoming wholly ridiculous at this point.

(Our Mohawk friends also take pity on us, luckily)

# ? Mar 28, 2015 02:59

Precambrian Video Games: Aug 19, 2002

Mandibular Fiasco posted:

That is just astounding. The sheer ignorance of that so-called 'panel' is beyond me. Sherry Cooper is a disgraceful human being. It is astounding to me that anyone employs her to do anything. I'll never forget her claim that we should peg the C$ at US$0.50, because that would be best for exports and manufacturing. No wonder she works for the Don Cherry Debt Factory.

quote:

Sherry Cooper: When you ask what are the big risks, we�re going to see, at some point, a recession. It�s probably a global recession. It may emanate from outside of Canada, as many do. Most do. One thing that really scares me is major terrorism in Toronto. That doesn�t cause a collapse in the economy per se, but it sure makes people rethink things. We won�t be walking into our office buildings without showing our picture IDs and stuff the way they do in New York.

quote:

Mike Eppel: Are mortgage rates actually going up at some point?

Sherry Cooper: Well, they are going to go up. They�ve got nowhere to go but up.

Garth Turner: People are use now to mortgages at 2.5 or 3 per cent. If you normalize and they go back to 6 or 7 per cent, it�s a huge issue.

...

Mathew Rosenblatt: Did you come in at 2 per cent mortgage rates or 4 per cent? I think, as Sherry said, if they double, we�re fine. Beyond that, we would have a crisis.

Barry Cohen: I don�t see how we could be fine at 7 per cent.

Karen Stintz: I don�t think we�re fine at 7 per cent. I don�t think we�re fine at all.

Ron Johnson: We�re going to have to wrap things up here, folks. Crystal ball time.

Paul Miklas: I think where we sit right now, real estate�wise, we�re in great shape. If you�re going to invest in the market, I would. I�d highly recommend getting your hands on any type of real estate at this
particular point, whether it�s a condominium from Brad or a home from Barry. Getting into the game, I think, is very important.

^ 100

It's nice to see Karen Stintz continuing her streak of achievements. Since I last read a puff piece on what a hard-working genius she is, she pissed away her credibility and potentially a billion-odd dollars of Toronto's budget on a pointless Scarborough subway extension plan, utterly failed in her bid to become mayor - which is how she justified the subway flip-flop in the first place - and is now all aboard the real estate bandwagon. What a waste of skin.

# ? Mar 28, 2015 03:34

namaste friends: Sep 18, 2004; by Smythe

http://www.theglobeandmail.com/report-on-business/rob-magazine/vancouvers-high-tech-makeover/article23614007/

quote:

Vancouver�s high-tech makeover
RICHARD LITTLEMORE
Special to The Globe and Mail

When the guides of the future plan the itinerary for the walking tour dubbed �Vancouver: Tech City,� they�ll start in Railtown. After all, this is where the social media company Hootsuite emerged in 2008, amid the cheap, converted warehouses between the Downtown Eastside and the docks on Burrard Inlet. Back then, you called the neighbourhood �sketchy,� but that got you the stink eye from Bill Tam, president and CEO of the BC Technology Industry Association: �It�s edgy!�

The next stop on the tour will be Gastown, another old neighbourhood of small-footprint buildings full of walk-up offices, but one that was more gentrified in the early days�not �edgy� but �funky.� In 2015, this was the home of entrepreneurial hothouses like Launch Academy, where hopeful youngsters learned how to innovate�or how to fail quickly and start again before they dragged their friends and family members into an expensive mistake.

Following a semi-circle, the tour will run through downtown, where the high-tech industry suddenly became so dominant around 2015 that it outbid law firms and government ministries for the city�s most prestigious office space. And then it�s on to Yaletown, another converted warehouse district that, in the dawning era, bristled with clubs, caf�s, spas and fitness emporiums�and high-tech offices brimming with thousands of hipster techies who could afford that kind of thing.

Then, down past the Telus World of Science, tourists on this outing will come to Mount Pleasant, where Hootsuite took over a snazzy space in a move facilitated by the always-accommodating Vancouver Economic Commission.

Finally, saving the best for last, it will be on to the SkyTrain for a quick trip to Burnaby and the 10-minute walk to The Company That Saved the World.

*************************************

Every great tech scene has an origin story, complete with a ground zero, like the Palo Alto garage where Bill Hewlett and Dave Packard, late of Stanford, seeded Silicon Valley. In British Columbia, the point of genesis is in the Vancouver suburb of Richmond, in an old shed long since lost in the fog along the Fraser River delta. That�s where Professor John MacDonald and physics grad Vern Dettwiler headed on Feb. 3, 1969, after they walked out of the University of British Columbia to set up a little remote-sensing company. They thought that they had an interesting technology, and they were disappointed that the brilliant young scientists and engineers they�d seen go through UBC all seemed to be leaving town. The two men hoped they might be able to keep some of the more promising students employed. Now, 46 years later, MacDonald Dettwiler and Associates Ltd.�better known as MDA�is a communications and information company with more than 4,800 employees arrayed in plants and offices around the world, including 600 in its head office and still-leading research-and-development centre in Richmond. They build everything from black-box military communications systems to radar satellites. And in their benign shadow, the high-technology sector in B.C. now employs 84,000 people, more than the forestry, mining and oil and gas industries combined.

According to a recent KPMG report commissioned by the BC Technology Industry Association, B.C. boasts 9,000 high-tech companies that together generate more than $15 billion in direct economic impact�that�s 7.6% of provincial GDP. That sudden growth, in a province that still can�t shake the resource-industry self-image, has produced a buzz, and the buzz has turned to giddiness with the arrival and/or expansion in Vancouver of some major international players. Microsoft and Sony Pictures Imageworks have staked out huge footprints in what is arguably the highest-profile commercial space in downtown Vancouver�the redeveloped former Eaton�s (later Sears) department store that anchors Pacific Centre at 725 Granville St. Barely a block away, Amazon is installing 1,000 high-tech employees in the Telus Garden, a new head office for a telco that is, itself, a tech giant, with 7,000 employees in Metro Vancouver, including 1,200 in the downtown core; 700 of them will work at this new location.

The attendant pressure has changed the face of commercial real estate in Vancouver�s suddenly crowded downtown. Norm Taylor of commercial real estate firm CBRE says the market is set to absorb more than two million square feet of new office space in the next two years, the largest growth spurt in Vancouver�s history. As of late February, that space was more than 60% pre-leased. And in a central business district once reserved for head offices (or what small share Vancouver has of them), high-end law and accounting firms and government, high tech�growing at twice the speed of the rest of the B.C. economy�is generating more than 40% of the demand for office space.

It�s true, of course, that B.C.�s $15 billion in tech salaries, services, sales and exports pales next to California�s $275 billion. But it�s early days. �B.C. is in that adolescent growth stage when parts of you grow faster than others. It�s an awkward passage,� says Bill Tam.

The gawky phase has demonstrated three things, each of which bodes well for the future. First, tech is all about people, and every person interviewed for this story made some reference to B.C.�s research universities as a source of both tech geniuses and bold entrepreneurs. (Full disclosure: I have written for the presidents of UBC, Simon Fraser University and the University of Victoria.)

Second, tech is sticky. Sure, it�s not physically stuck to a resource like mining or forestry. But it�s surprisingly difficult to pick up and move an established tech company�especially the creative part.

Third, tech is all about critical mass. Once you have the above-mentioned talent pool, you get networking and creative cross-pollination. And you get spinoffs minted by people with serious industry experience. While no one is bold enough to say Vancouver has reached critical mass, the success of homegrown heavyweights like Hootsuite, and the arrival or expanding presence of international anchors, indicates a sector heading toward maturity.

Actually, �sector� isn�t the right word to describe this phenomenon any more. In a time and place where a surprising number of people subscribe to both Greenpeace and Harvard Business Review, we talk about the tech �ecosystem� and its �biodiversity.� Tech is no longer as sterile as a lab. It�s a forest of interaction where little things feed big things and big things, in turn, seed new little things.

The best illustration of this is the BC Techmap, an interactive visual history compiled by PricewaterhouseCoopers over the last 18 years. The map shows thick bundles of connections emanating from the research universities. In a 2013 report on some 220 UBC spinoffs and affiliated companies, Colliers International calculated total market capitalization of $2.5 billion and total annual revenue of $400 million. SFU says that it has �spun out, mentored, incubated and assisted over 200 companies, adding more than 2,400 jobs to our economy and contributing an estimated $186 million in annual tax revenues.� That�s just direct economic activity driven from university labs�everything from biotech contenders like QLT Inc. to cleaner-energy industries like Westport Innovations. The universities, with help from institutions such as the British Columbia Institute of Technology and Emily Carr University of Art + Design, also spawn the engineers, scientists and technicians in clean tech, the health professionals and researchers in biotech, the computer and electrical engineers in web tech, and the designers, artists and storyboard writers in gaming and computer animation. Oh yes, and the business people.

Once in the tech sector, few of those people sit still. One of the next biggest tentacle bundles on the Techmap runs from MDA to the many dozens of other companies that have benefited over the years from lessons learned at the knee of MDA�s masters. Another bundle emanates from Ballard Power Systems, the once-ballyhooed fuel-cell innovator whose biggest actual output to date may be counted in talent that it has trained and sent on to other enterprises.

Consider Mossadiq Umedaly, who was Ballard�s chief financial officer in its mid-�90s heyday when Ballard, Daimler-Benz and Ford together looked like they might seize the whole burgeoning market for no-emission vehicles (said market imploded when regulatory leader California decided that hybrids were a more practical alternative). Umedaly says that Ballard�s chairman at the time, the late Fraser Mustard, used to divide the tech world into �doers� and �thinkers,� and then, � la Rumsfeld, into �doers who think� and �thinkers who do.� Umedaly, a doer who thinks, left Ballard before its slide and, in 1999, assumed the presidency (and later the chair) of Xantrex, a power electronics company that had been working on unsexy but practical power inverters since 1983. Umedaly saw the potential to scale up the Xantrex operation, especially in an age when inverters were becoming essential to managing intermittent power from renewable sources like wind and solar. He found a first round of financing and then floated an IPO in 2004, and by the time he sold the company in two pieces to Ametek and Schneider Electric, Xantrex was �the biggest clean-tech company in B.C.,� with annual revenues of $250 million.

Schneider is huge; �it�s the French Siemens,� says Schneider�s VP operations and CFO for solar, Jill Tipping. With 150,000 employees around the world and 3,000 in Canada, the company had the capacity to relocate its 200 new Burnaby employees, specialists in solar power, pretty much anywhere�a thought that Tipping says never came up. Instead, the company�s global solar business unit is headquartered in Burnaby.

Although Xantrex had no manufacturing here, almost no sales and�given the low cost of B.C.�s hydroelectric power�no market, �this is the brain trust; it�s the gold mine. The risk of moving it and disrupting it accidentally is too high,� Tipping says. In the tech world, �you do the things that are smart to do in the places that are smart to do them,� she adds, pointing to Apple, which designs in California and manufactures in China. Tipping�s only reservation about Metro Vancouver is that question of critical mass. There is great local talent, but Schneider still has to recruit mid-career managers and senior engineers from elsewhere. So, Tipping says, Schneider is delighted to see companies like Microsoft upping their Vancouver presence. �Even if they�re not directly in our space, it still creates a cluster effect that�s good for us.�

The story is similar at the Vancouver operations of what is now SAP, the world leader in enterprise software and software-related services, with 130 offices around the world and 74,000 employees. The 1,200-person Vancouver operation began in the 1980s as a local start-up called Crystal Services. Owing to a succession of takeovers, it was later known as Seagate Software, Crystal Decisions and Business Objects before being acquired by SAP in 2008. Again, SAP has the global capacity to shift or absorb smaller operations, but in Vancouver, it chose to consolidate and expand. Kirsten Sutton, managing director for SAP Labs Canada, says this location is now the SAP Canadian Centre of Excellence for Analytics�the largest software development employer in B.C., it�s SAP�s locus for innovation in some of its most important product lines. As with Schneider and Xantrex, Sutton says, moving was never an option. �The DNA is what SAP needed,� and that DNA is peculiar to Vancouver. �It�s the culture, the work-life balance. People who work here love it here and it comes through in their work.�

*************************************

In any story of Vancouver, it is, of course, inevitable that the work-life thing would come up. The city is so often dismissed as being full of people who spend too much time hiking and skiing and standing in the path of pipelines. Sitting in the spectacular downtown wedged between False Creek and Burrard Inlet in the lee of the North Shore Mountains, it�s easy to understand how people in the rest of the country would find Vancouverites smug (even if self-deluding about whether it�s worth the cost of living). But nearly everyone interviewed for this story had recently travelled to Eastern Canada, and they all felt compelled to give a weather report. In a February phone conversation, Don Osborne, president of the MDA Information Systems Group, mentioned that he was looking out across a busy, balmy Richmond golf course�and that, in Ottawa and Montreal, which he had visited the previous week, the temperature had been minus 35. SAP�s Kirsten Sutton phoned from the airport in Toronto. Minus 25. Dennis Lopes, head of legal and corporate affairs for Microsoft Canada, called from the Vancouver airport, taking his last whiff of air redolent of early cherry blossoms. He was flying home to Microsoft�s Canadian head office, also in the Toronto area, and he was dreading the change.

Microsoft is busily recruiting for its newest international development centre in the spanking new Pacific Centre space. (It has similar centres around the world from China to Finland, but no others in Canada or the U.S.) To this end, Lopes says, �We�re recruiting from around the world and, from a candidate perspective, Vancouver is very desirable, despite the high cost of living.� He went on to deliver an analysis straight out of Richard Florida. In addition to being warm and beautiful and conducive to an outdoor lifestyle, Vancouver is richly multicultural and highly diverse, all aspects that are attractive to people from the creative sector. It�s also close to Microsoft�s international headquarters in Seattle, although what really matters, for people collaborating on projects, is that it�s in the same time zone. Asked, though, if this is a recruiting centre whose real purpose is to consolidate staff, the best of whom would then be cherry-picked to go south of the border, Lopes dismisses the suggestion out of hand. Microsoft already had a Vancouver development staff of about 300. Rather than sending those folks south, it�s more than doubling their numbers. The staff in the new 143,000-square-foot Pacific Centre office will number 700, and there is a rumour (which Lopes declined to confirm) that Microsoft has told its broker that it may hang on to 75,000 square feet in an existing office in tony Yaletown. Microsoft is digging in�and in a way that contributes to a growing Canadian myth: head office, sales and marketing types go to Toronto; techies, creative and other hipsters to the Left Coast.

Mind you, it�s not all about the mountains, the oceans and the choice of three cappuccino purveyors on every block. Randy Lake, executive vice-president and general manager of the animation and visual-effects leader Sony Pictures Imageworks, brings a hard, cold, cash-based reality back into play when he says, �I love Vancouver.� Having moved the Imageworks head office from Culver City, California, to Pacific Centre as of April 1, �I would not want to pick up and leave. But if the [tax] incentives were gone tomorrow�well, that�s my nightmare scenario.� The sweetest of those incentives, for Sony, is the DAVE�the Digital Animation or Visual Effects�tax credit, which lately means that a credit of �17.5% can be applied against any qualified B.C. labour expenditures that are incurred while performing eligible post-production activities in B.C.� Lake says this break, more than any other factor, drove the relocation from Culver City.

Still, even Lake returns to the metaphor of the high-tech ecosystem. His 750 animators and visual-effects specialists will be in the same building as Microsoft�s development staff, and they all will be mere blocks away from colleagues in Gastown and Yaletown, where Sony had maintained a smaller production studio for the last five years. Lake said the firm was originally attracted by the talent in homegrown firms like Distinctive Software (now part of Electronic Arts) and Image Engine. Here again, there is strength in numbers. The visual-effects community is highly nomadic, jumping from one film production to another and�when necessary�from one production company to another. So, again, it�s easier to recruit if prospective employees know that a subsequent shift would take them to, say, the sizable Industrial Light & Magic facility down the street and not all the way down the I5 to California.

*************************************

There are two other broad aspects to the B.C. tech story�and two other places in the ecosystem. At one extreme is the bold entrepreneurial start-up�the 5,000 one-person operations that don�t even get included in the count of 9,000 existing high-tech companies. At the other are the Hail Mary candidates, like General Fusion. This is The Company That Saved the World (or at least Would Save): a $50-million gamble to produce an energy source that founder Michel Laberge insists would render fossil fuels redundant for everyone on Earth.

Laberge personifies the surprisingly short distance between those extremes. First, he is, himself, an indirect product of MDA. Following the BC Techmap, MDA begat Creo, the laser-imaging company that was acquired by Kodak in 2005. Laberge worked at Creo for nine years after receiving a PhD in physics from UBC. At Creo, he says, he learned there was more to business than �solving a triple integral equation.� But he got bored with Creo�s lasers, took his savings and set to work, in an abandoned gas station on Bowen Island, on a simple fusion power plant.

In other words, a decade ago, he was one of those start-up companies with no employees. But, by his efforts, he generated both heat and light. In fact, he generated enough energy to convince Mike Volker, director of SFU�s Innovation Office and co-founder of the Vancouver Angel Technology Network, to raise a total of $420,000 from 60 investors. Then Laberge recruited Creo colleague Doug Richardson (�for no salary!�) as CEO, and, between them, they made enough progress to attract another $50 million in financing, including contributions from everyone from Chrysalix Global Network and the oil sands company Cenovus to Jeff Bezos. They�re now working on the components of a fusion-energy reactor that will have no long-lived radioactive waste and a nearly inexhaustible fuel supply from sources such as heavy hydrogen atoms from seawater. �We�re trying to convince ourselves that it will work,� Laberge says. �Then we will need a big pile of cash.� He thinks their design could result in a plant that costs only $200 million, compared to the nearly $20-billion (U.S.) bill for the latest experimental fusion reactor in France.

This gets to one of the last, limiting factors affecting Vancouver�s reach for tech greatness: big piles of cash. While these seem to be available in the trunk of every Silicon Valley Jaguar, everyone complains that they are in short supply north of the border.

Haig Farris, the famed West Coast angel investor who co-founded and ran Ventures West, and who helped raise the $200 million that put the Burnaby quantum computing company D-Wave on the map, sniffs at the suggestion. �I�ve been in this business since 1973 and it hasn�t changed one little bit: I go to Silicon Valley and all I hear is, �It�s so hard to raise money.��

But then he acknowledges that, in some ways, things have changed. �Now physics and math are driving everything and people in the venture capital community don�t get it. Neither the media nor the investors understand. So, there�s lots of angel money. But it�s hard to get people to commit for long-term, complicated things: for artificial intelligence, learning computers and materials science. The best deals are still the hardest to sell.�

And yet, Mossadiq Umedaly, who has also spent much of the past decade managing or facilitating tech investments, says: �For a good idea, there�s always money.�

Which bit of optimism leads to a last word from Laberge, who is Qu�b�cois, funny and self-deprecating in a completely unconvincing way, and who, if he succeeds, could generate a dividend that will make the combined job-creating tech fortunes of Jeff Bezos, Mark Zuckerberg and Elon Musk seem modest. Laberge offers both a complaint, and a solution: �It�s as hard to find the money as it is to find the fusion. I walked a lot to find the money. So, I�d say, you need a good idea and long legs.�

Also, you know you're dealing with a loving idiot when they refer to the DTES as ~*railtown*~ :bahgawd:

# ? Mar 28, 2015 04:40

namaste friends: Sep 18, 2004; by Smythe

http://ftalphaville.ft.com/2015/03/27/2125141/buiter-on-soggy-global-growth-in-2015/

quote:

If you look at the global inflation which we see at about 2 per cent or something like that, so there is a world where collectively, despite all the attempts by what is now 24 central banks to decouple from the dollar by being more expansionary, there�s still not enough demand stimulus to burst this global disinflationary pattern.

One would hope that at some point the combined efforts of those who have significant negative output gaps would outweigh those of whom are closing them fast, but it seems there are very few countries which have a positive output gap at this point, so this is a soggy global growth report, especially given the steady deceleration of emerging markets almost without exception, apart from one bright shining light, but with everything else from China to Russia to Brazil and now also Mexico being revised steadily down, but I think there�s more to come in the case of China.

tl;dr Poloz is going to have to cut rates again.

# ? Mar 28, 2015 04:53

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# ? May 21, 2024 15:54

namaste friends: Sep 18, 2004; by Smythe

RICH HATING

https://scamcouver.wordpress.com/2015/03/27/the-cringe-luxury-supercar-capital/

# ? Mar 28, 2015 05:32

The Something Awful Forums > Discussion > Debate & Discussion > Canada Housing/Debt: Trust me, I'm a landlord.

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