HISTORY & READINGS at Brian Ripley's Canadian Housing Price Charts & Plunge-O-Meter

Show me the Money

1/30/2015

Canadian Government Spending vs Labour Participation

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Government Spending

The top panel shows Canadian Government Spending vs Labour Force Participation and the lower panel shows Canadian Jobs Added on an Annual Basis all since 2008.

The two biggest line items of Federal Government Expenditures as of 3Q 2014 are:

Gross current expenditure on goods and services (63% of Total Expenditures, up 0.9% since 4Q 2011) and
Current transfers to households (23% of Total Expenditures, up 0.7% since 4Q 2011)
All other Federal Government Expenditures (14% of Total Expenditures since 4Q 2011) have dropped 1.5%

Government spending on itself and the household sector combined with ultra low borrowing rates have not yielded growth in Canadian Labour Force Participation.

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The Federal Government may announce a "balanced budget" going into the next election call but unless Canadian employees can reverse their debt to income ratio trend by either lowering debt or raising income, householders along with the Federal Managers will not be participating in productive economic spending in any big way.

Deutsche Bank reveals 7 reasons why ‘Canada is in serious trouble,’ starting with a 63% overvalued housing market. Financial Post, Business Insider, Andy Kiersz, January 8, 2015

If Treasury Yields are a measure of price and wage inflation, it's just not happening.

10 year T-Bond Yields, U.S. Canada, Japan & Europe

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Jerry Maguire - Show me the Money

Demographia 2015

1/22/2015

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Stealth Money ?

Vancouver BC continues to rank as the least affordable city out of the 35 largest Canadian cities with a multiple of 10.6 times median household income required to buy a median priced house.

Compared to Vancouver, Toronto's big housing un-affordability spike looks rational if one considers population size (2.5x), and volume of residential sales and absorption rate (both over 2x) and Federal Government funding transfers that are 3.3x more to Ontario than to BC.

The dynamics of size and government compacts with the voter have helped to accelerate, Toronto's housing un-affordability over the last 4 years while Vancouver's un-affordability appears to have triggered a limit to negative cash flow prostration.

MORE DEMOGRAPHIA CHARTS & DATA

In or Out

1/13/2015

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PRICED OUT OR PRICED IN?

Are you worried about being PRICED OUT of real estate because interest rates are going to zoom?

Or are you anxious about being PRICED IN because the commodity bust is widening?

A solution to these stressful thoughts is to move more to cash.

If rates do zoom you will be able to move cash into higher rates of return or if the asset value bust continues, you will be able to buy more value.

The charts above show the ongoing DEFLATION in consumption prices and wage earnings. The top panel is the MIT Billion Prices Project which tracks online in real time the high-frequency price data, as well as the US inflation index (CPI). The lower panel is the U.S. FRED chart of Y/Y total private average hourly earnings of all employees with the data plotted year over year to gauge the momentum. Both series are clearly down since the 2009 Pit of Gloom.

Without wage inflation, price inflation evaporates with every actor's change in sentiment from bull to bear.

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Gallup Poll January 12, 2015
45% (U.S.) say it's a good time to find a quality job (the highest since 2007 prior to the bust and the Pit of Gloom)

The Low point on this measure was 8% in 2009 (after the pit of Gloom) and in 2011 (after the top in Commodities)

Ukulele Orchestra - Should I Stay Or Should I Go

It's a Gas Gas Gas

1/4/2015

Beavers, Bears, Dragons, Eagles
and the Raven

It feels like the New Year won't really start until tomorrow's new work week and real estate boards start cranking out their data. While we wait, here is:

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As the above table of CIA Factbook data illustrates, Russia has the world's largest proved reserves of natural gas (16x Canada, 5x the U.S.), and the biggest markets for those assets are in east Eurasia not the west.

Now that Canada has increased its trade war footprint alongside the U.S. and NATO, all bets are off on 2015 being a banner year for Canadian GDP even with a plunging CAD.

Canada is a consumption economy, 75% of us work in the services sector; our falling CAD means rising price inflation on all the stuff we import. Not only do we add little value to the resources we haul out of the ground, but our OECD MFP (multi-factor productivity p.18) needed to sustain rising living standards, especially as the population ages (check) has been declining since 2002.

Our national selfie is snapped by men acting out their unresolved Oedipal issues behind a colossal military network with Canadian Foreign Affairs John Baird calling Moscow's travel ban of Canadian Civil Servants a “badge of honour” for Canada and Canadian Prime Minister Harper showing Australian Prime Minister Abbott "how to shirtfront ("smack down") the Russian President."

Just as Moses in the Bible claimed to have had personal contact with God and to have glimpsed the “promised land” of milk and honey, so Moses the raven in George Orwell’s Animal Farm "claimed to have been to Sugarcandy Mountain on one of his higher flights, and to have seen the everlasting fields of clover and the linseed cake and lump sugar growing on the hedges."

Prime Minister Stephen Harper, the Raven, is asking Canadians to pray for Canada's military personnel as they battle ISIS extremists in Northern Iraq. (Prime Minister's 2014 Christmas Message to Canadians).

Now, for the moment, we are safe. The only kind of international violence that worries most people in the developed countries is terrorism... We are very lucky people - but we need to use the time we have been granted wisely, because total war is only sleeping. All the major states are still organized for war, and all that is needed for the world to slide back into a nuclear confrontation is a twist of the kaleidoscope that shifts international relations into a new pattern of rival alliances. GWYNNE DYER, War: The Lethal Custom (Notable Quotes)

"...thinking long term; we're not talking about Ottawa..." Gwynne Dyer at UBC, Geopolitics in a hotter world.

Gwynne Dyer at UBC - Geopolitics in a Hotter World

Jumpin' Jack Flash by Aretha Franklin 1986

The table below shows Canadian government trade stats to and from Russia, China and the U.S. in 2013.

2013 INTRA COUNTRY TRADE AS A % OF TOTAL

Top 5 Canadian Exports to Russia

20% Meat of swine, fresh, chilled or frozen
8% Helicopters, airplanes and spacecraft
6% Crustaceans, live, fresh, chilled, frozen, dried, salted or in brine
5% Moving, grading, levelling, escavating, extracting, etc. machinery; snow-plows/blowers
3% Machinery for handling stones, ores or other mineral substances

Top 5 Canadian Imports from Russia

18% Crude petroleum oils and oils obtained from bituminous minerals
16% Mineral or chemical fertilizers, nitrogenous
15% Petroleum oils and oils obtained from bituminous minerals other than crude
9% Other precious metals, unwrought or in powder forms
6% Frozen fish, excluding fish fillets

Top 5 Canadian Exports to Mainland China

10% Iron ores and concentrates
9% Rape or colza seeds, whether or not broken
8% Chemical wood pulp, soda or sulphate, other than dissolving grades
7% Coal and solid fuels manufactured from coal
7% Lumber, of a thickness exceeding 6 mm

Top 5 Canadian Imports from Mainland China

10% Automatic data processing machines; optical readers, machines for transcribing data, etc
9% Telephone sets; other apparatus for transmission/reception of voice/image/data
2% Motor vehicle parts (excluding body, chassis and engines)
2% Wheeled toys; dolls/their carriages; other toys; reduced-size models; puzzles
2% Seats

Top 5 Canadian Exports to United States