April Stats
5% less sales than last April
7% more listings than April 2011
6% more inventory than April 2011
2nd lowest sales for an April in the last decade
SFH
Average price down 8.1% YOY!!
Median price down 3.7%
And yet MLS HPI Benchmark is up 5.3%- huh!
Look at South Surrey/White Rock. Half as many sales as last year, average down, median down, benchmark up!
Very odd. To have the median and average down so much YOY and yet the benchmark up so much. We will let that go without comment and assume that they have used some sort of reproducible methodology to calculate the benchmark.
Sales to listings is 14%. Well into buyer's territory - see the graph that they have near the end of the stats presentation
Sunday, May 6, 2012
Saturday, May 5, 2012
Sometimes we have to look past RE in our town
and look at the bigger picture. The 'and then some', in the title of this blog.
We know that the CMHC is finally going to be roped in, the question is, is it too late?
It may well be. The CMHC has accounted up to 60% of all mortgages in recent years according to it's $600 Billion Cap and the $1.1 trillion Mortgage industry.
That is an astounding number for one institution. Then when you learn that the institution is Government backed, you wonder if we live in North Korea or a few of the last bastions of Government run economies. Except this semi-socialist animal has in fact made a few (brokers, speculators, developers) very wealthy and spread the risk to many.
To many of us bloggers, it was obvious what a scam this was which was benefitting a very few people. here's how it goes:
1) Bank of Canada keeps rates at zero.
2) Savers get zero on deposits + banks sell bonds at near zero as they have implicit Gov of Canada backing = accumulate a lot of cash which has to be put to work.
3) Banks offer mortgages to everyone with a pulse..money back, high leverage, speculative, stated income, mortgage holiday etc etc
4) They get CMHC insurance - hence the bulk of the risk is transferred to you and I.
5) The banks sit back and clip coupons - getting 3-4% gross on each dollar lent, but since they are leveraged up, multiple times this amount.
6) banks look sound. Speculators, developers, mortgage brokers, bank CEOs and some realtors make great huge chunks of money.
The profit comes from the hide of savers (zero rates) + first-time buyers (higher prices) + the tax-payer (future liability)
No wonder they didn't want the golden goose to be killed. Several years ago David LePoidevin a money manager at National Bank pointed at the CMHC as the creator of the housing bubble.
The CEO of National Bank jumped in to defend the CMHC and said that he did not share his manager's views. Who could blame him, the wagon kept on rolling and the bonuses kept on coming. A cool $5-6 Million a year, which is a lot for a small bank.
Since then the problem has been made a lot worse. About $300 Billion worse.
When Flaherty doubled the CMHC lending cap, and dished out money to the banks, yes he saved Canada from the worst of the financial down-fall -But he knew what he was doing long-term.
- He was adding air to the housing bubble. A LOT more air. $300 Billion more in a $1 Trillion market! Now the bubble will deflate from a much higher level and cause a lot more collateral damage.
- He transferred risk into the future.
- He cynically backed a semi-socialist organ (which was set up after the war to help the poor get mortgages) and turned it into a financial megalith, a bonus generator for Bay Street.
- He bought Stephen Harper his majority.
In case any of you still think that it is wise to have a debt-burdened economy (and remember we are now at the same level of consumer debt that the US was before their collapse) then I would suggest you read this excellent summary from the most astute money managers in the US.
Economies which are debt laden from RE booms (think Japan, Spain, the UK and the US) go through very painful adjustments. There is no reason why we should be any different.
The sad part is, it could have all been prevented. It is hard to imagine how we could all have been so foolish.
-
We know that the CMHC is finally going to be roped in, the question is, is it too late?
It may well be. The CMHC has accounted up to 60% of all mortgages in recent years according to it's $600 Billion Cap and the $1.1 trillion Mortgage industry.
That is an astounding number for one institution. Then when you learn that the institution is Government backed, you wonder if we live in North Korea or a few of the last bastions of Government run economies. Except this semi-socialist animal has in fact made a few (brokers, speculators, developers) very wealthy and spread the risk to many.
To many of us bloggers, it was obvious what a scam this was which was benefitting a very few people. here's how it goes:
1) Bank of Canada keeps rates at zero.
2) Savers get zero on deposits + banks sell bonds at near zero as they have implicit Gov of Canada backing = accumulate a lot of cash which has to be put to work.
3) Banks offer mortgages to everyone with a pulse..money back, high leverage, speculative, stated income, mortgage holiday etc etc
4) They get CMHC insurance - hence the bulk of the risk is transferred to you and I.
5) The banks sit back and clip coupons - getting 3-4% gross on each dollar lent, but since they are leveraged up, multiple times this amount.
6) banks look sound. Speculators, developers, mortgage brokers, bank CEOs and some realtors make great huge chunks of money.
The profit comes from the hide of savers (zero rates) + first-time buyers (higher prices) + the tax-payer (future liability)
No wonder they didn't want the golden goose to be killed. Several years ago David LePoidevin a money manager at National Bank pointed at the CMHC as the creator of the housing bubble.
The CEO of National Bank jumped in to defend the CMHC and said that he did not share his manager's views. Who could blame him, the wagon kept on rolling and the bonuses kept on coming. A cool $5-6 Million a year, which is a lot for a small bank.
Since then the problem has been made a lot worse. About $300 Billion worse.
When Flaherty doubled the CMHC lending cap, and dished out money to the banks, yes he saved Canada from the worst of the financial down-fall -But he knew what he was doing long-term.
- He was adding air to the housing bubble. A LOT more air. $300 Billion more in a $1 Trillion market! Now the bubble will deflate from a much higher level and cause a lot more collateral damage.
- He transferred risk into the future.
- He cynically backed a semi-socialist organ (which was set up after the war to help the poor get mortgages) and turned it into a financial megalith, a bonus generator for Bay Street.
- He bought Stephen Harper his majority.
In case any of you still think that it is wise to have a debt-burdened economy (and remember we are now at the same level of consumer debt that the US was before their collapse) then I would suggest you read this excellent summary from the most astute money managers in the US.
Economies which are debt laden from RE booms (think Japan, Spain, the UK and the US) go through very painful adjustments. There is no reason why we should be any different.
The sad part is, it could have all been prevented. It is hard to imagine how we could all have been so foolish.
-
Friday, May 4, 2012
list of Malaysia past expenditures ?
I saw below list from facebook, do you know what they are !?!?
1. PKFZ RM12 billion
2. Submarine Commission RM500 million
3. Sime Darby RM964 million
4. Paya Indah Westland RM88 million
5. Pos Malaysia (Transmile) RM230 million lost
6. Eurocopter deal RM1 billion wasted?
7. Terengganu Stadium collapse RM292 million
8. MRR2 repair cost RM70 million
9. Maybank overpaid BII RM4 billion
10. Tourism - NYY kickback RM10 million
11. 3 paintings bought by MAS RM1.5 million
12. Overpayment by Sport Ministry RM8.4 million
13. London’s white elephant sports complex RM70 million
14. MATRADE repairs RM120 million
15. Cost of new plane used by PM RM200 million
16. InventQ irrecoverable debt RM228 million
17. Compensation for killing crooked bridge RM257 million
18. Loss in selling Augusta RM 510 million
19. Worth of APs given out in a year RM1.8 billion
20. Submarines (future Muzium Negara artifacts) RM4.1 billion
21. PSC Naval dockyard RM6.75 billion
22. The Bank Bumiputra twin scandals in the early 1980s saw US$1
billion losses (RM3.2 billion in 2008)
23. The Maminco attempt to corner the World Tin Market in the
1980s is believed to have cost some US$500 million (RM1.6
billion)
24. Betting in foreign exchange futures cost Bank Negara Malaysia
RM30 billion in the 1990s
25. Perwaja Steel’s US$800 million (RM2.56 billion) losses
26. Use of RM10 billion public funds in the Valuecap Sdn Bhd operation to shore up the stock market
27. Banking scandal of RM700 million losses in Bank Islam
28. The sale of M.V. Agusta by Proton for one Euro making a loss of €75.99 million (RM348 million) Same as No.20?
29. Wang Ehsan from oil royalty on Terengganu RM7.4 billion from 2004 – 2007
30. For the past 10 years since Philharmonic Orchestra was established, this orchestra has swallowed a total of RM500 million. Hiring a Kwai-Lo CEO with a salary of more than RM1 million per annum!
31. In Advisors Fees, Mahathir was paid RM180,000, Shahrizat Abdul RM404,726 and Abdul Hamid Othman (religious) RM549,675 per annum
32. The government has spent a total of RM3.2 billion in teaching Maths and Science in English over the past five years. Of the amount, the government paid a whopping RM2.21 billion for the purchase of information and computer technology (ICT) equipment which it is unable to give a breakdown. Government paid more than RM6,000 per notebook vs per market price of less than RM3,000 through some new consortiums that was setup just to transact the notebook deal. There was no Maths & Science Content for the teachers and the notebooks are all with the teachers' children now.
33. The commission paid for purchase of jets and submarines to two private companies - Perimeker Sdn Bhd and IMT Defence Sdn Bhd amounted to RM910 million. Expanding on No. 2?
37. RM300 million to compensate Gerbang Perdana for the RM1.1 billion "Crooked Scenic Half-Bridge"
38. RM1.3 billion has been wasted building the white elephant Customs, Immigration and Quarantine (CIQ) facilities on cancellation of the Malaysia-Singapore Scenic Bridge
39. RM100 million on renovation of Parliament building which leaks
40. National Astronaut (actually tourist) Programme – RM40 million
41. National Service Training Programme – yearly an estimate of RM 500 million ( MOST National Service Camp LAND OWNERS are tied to Najib or old 'friends' of Najib )
42. Eye of Malaysia - RM30 million and another RM5.7 million of free tickets
43. RM2.4 million on indelible ink
44. Samy Vellu announced in September 2006 that the government paid compensation amounting to RM38.5 billion to 20 highway companies. RM380 million windfalls for 9 toll concessionaires earned solely from the toll hike in 2008 alone
45. RM32 million timber export kickbacks involving companies connected to Sarawak Chief Minister and his family.
46. Two bailouts of Malaysia Airline System RM7.9 billion. At a time when MAS is incurring losses every year, RM1.55 million used to buy three paintings to decorate its Chairman’s (Munir) office. Expanding on No.11
47. Putra transport system bailout which cost RM4.486 billion.
48. STAR-LRT bailout costing RM3.256 billion.
49. National Sewerage System bailout costing RM192.54 million.
50. Seremban-Port Dickson Highway bailout costing RM142 million
51. Kuching Prison bailout costing RM135 million
52. Kajian Makanan dan Gunaan Orang Islam bailout costing RM8.3 million
53. Le Tour de Langkawi bailout costing RM3.5 Million
54. Wholesale distribution of tens of millions of shares in Bursa Malaysia under the guise of NEP to cronies, children and relatives of BN leaders and ministers worth billions of ringgit.
55. Alienation of tens of thousands of hectares of commercial lands and forestry concessions to children and relatives of BN leaders and Ministers worth tens of billions of ringgits.
56. Since 1997, Petronas has handed out a staggering RM30 billion in natural gas subsidies to IPPs who were reaping huge profits. In addition, there were much wastages and forward trading of Petronas oil in the 1990s based on the low price of oil then. Since the accounts of Petronas are for the eyes of the Prime Minister only, we have absolutely no idea of the amount.
57. RM5,700 for a car jack worth only RM50
58. Government-owned vehicle consumed a tank of petrol worth RM113 within a few minutes
59. A pole platform that cost RM990 was bought for RM30,000
60. A thumb drive that cost RM90 was bought for RM480
61. A cabinet that cost RM1,500 was bought for RM13,500
62. A flashlight that cost RM35 was bought for RM143
63. Expenses for 1Malaysia campaign paid to APCO?
64. RM17 billion subsidy to IPP
65. US$24 million Diamond Ring for Ro$mah - Cancellation of Order - how much compensation?
66. CowGate ... RM250 million
67. Monsoon Cup . . . RM800 million per year
68. Illicit Fund Transfers out of Malaysia (2000 - 2009) : RM 1,077,000,000,000!
69. Tajudin-Danaharta settlement to cover up for Dr M and Daim
70. Billions of ringgit toll concessions that disadvantage the government and taxpayers
71. MUSA-AMAN's Timber-Concessions kick-backs worth $90Million US Dollars into his personal account causing thousands of acres of precious Rainforest in Sabah ( homes of endangered wild life such as Orangutans, Borneo Pygmy-Elephants & the Sumatran Rhino ) to be cut-down....
1. PKFZ RM12 billion
2. Submarine Commission RM500 million
3. Sime Darby RM964 million
4. Paya Indah Westland RM88 million
5. Pos Malaysia (Transmile) RM230 million lost
6. Eurocopter deal RM1 billion wasted?
7. Terengganu Stadium collapse RM292 million
8. MRR2 repair cost RM70 million
9. Maybank overpaid BII RM4 billion
10. Tourism - NYY kickback RM10 million
11. 3 paintings bought by MAS RM1.5 million
12. Overpayment by Sport Ministry RM8.4 million
13. London’s white elephant sports complex RM70 million
14. MATRADE repairs RM120 million
15. Cost of new plane used by PM RM200 million
16. InventQ irrecoverable debt RM228 million
17. Compensation for killing crooked bridge RM257 million
18. Loss in selling Augusta RM 510 million
19. Worth of APs given out in a year RM1.8 billion
20. Submarines (future Muzium Negara artifacts) RM4.1 billion
21. PSC Naval dockyard RM6.75 billion
22. The Bank Bumiputra twin scandals in the early 1980s saw US$1
billion losses (RM3.2 billion in 2008)
23. The Maminco attempt to corner the World Tin Market in the
1980s is believed to have cost some US$500 million (RM1.6
billion)
24. Betting in foreign exchange futures cost Bank Negara Malaysia
RM30 billion in the 1990s
25. Perwaja Steel’s US$800 million (RM2.56 billion) losses
26. Use of RM10 billion public funds in the Valuecap Sdn Bhd operation to shore up the stock market
27. Banking scandal of RM700 million losses in Bank Islam
28. The sale of M.V. Agusta by Proton for one Euro making a loss of €75.99 million (RM348 million) Same as No.20?
29. Wang Ehsan from oil royalty on Terengganu RM7.4 billion from 2004 – 2007
30. For the past 10 years since Philharmonic Orchestra was established, this orchestra has swallowed a total of RM500 million. Hiring a Kwai-Lo CEO with a salary of more than RM1 million per annum!
31. In Advisors Fees, Mahathir was paid RM180,000, Shahrizat Abdul RM404,726 and Abdul Hamid Othman (religious) RM549,675 per annum
32. The government has spent a total of RM3.2 billion in teaching Maths and Science in English over the past five years. Of the amount, the government paid a whopping RM2.21 billion for the purchase of information and computer technology (ICT) equipment which it is unable to give a breakdown. Government paid more than RM6,000 per notebook vs per market price of less than RM3,000 through some new consortiums that was setup just to transact the notebook deal. There was no Maths & Science Content for the teachers and the notebooks are all with the teachers' children now.
33. The commission paid for purchase of jets and submarines to two private companies - Perimeker Sdn Bhd and IMT Defence Sdn Bhd amounted to RM910 million. Expanding on No. 2?
37. RM300 million to compensate Gerbang Perdana for the RM1.1 billion "Crooked Scenic Half-Bridge"
38. RM1.3 billion has been wasted building the white elephant Customs, Immigration and Quarantine (CIQ) facilities on cancellation of the Malaysia-Singapore Scenic Bridge
39. RM100 million on renovation of Parliament building which leaks
40. National Astronaut (actually tourist) Programme – RM40 million
41. National Service Training Programme – yearly an estimate of RM 500 million ( MOST National Service Camp LAND OWNERS are tied to Najib or old 'friends' of Najib )
42. Eye of Malaysia - RM30 million and another RM5.7 million of free tickets
43. RM2.4 million on indelible ink
44. Samy Vellu announced in September 2006 that the government paid compensation amounting to RM38.5 billion to 20 highway companies. RM380 million windfalls for 9 toll concessionaires earned solely from the toll hike in 2008 alone
45. RM32 million timber export kickbacks involving companies connected to Sarawak Chief Minister and his family.
46. Two bailouts of Malaysia Airline System RM7.9 billion. At a time when MAS is incurring losses every year, RM1.55 million used to buy three paintings to decorate its Chairman’s (Munir) office. Expanding on No.11
47. Putra transport system bailout which cost RM4.486 billion.
48. STAR-LRT bailout costing RM3.256 billion.
49. National Sewerage System bailout costing RM192.54 million.
50. Seremban-Port Dickson Highway bailout costing RM142 million
51. Kuching Prison bailout costing RM135 million
52. Kajian Makanan dan Gunaan Orang Islam bailout costing RM8.3 million
53. Le Tour de Langkawi bailout costing RM3.5 Million
54. Wholesale distribution of tens of millions of shares in Bursa Malaysia under the guise of NEP to cronies, children and relatives of BN leaders and ministers worth billions of ringgit.
55. Alienation of tens of thousands of hectares of commercial lands and forestry concessions to children and relatives of BN leaders and Ministers worth tens of billions of ringgits.
56. Since 1997, Petronas has handed out a staggering RM30 billion in natural gas subsidies to IPPs who were reaping huge profits. In addition, there were much wastages and forward trading of Petronas oil in the 1990s based on the low price of oil then. Since the accounts of Petronas are for the eyes of the Prime Minister only, we have absolutely no idea of the amount.
57. RM5,700 for a car jack worth only RM50
58. Government-owned vehicle consumed a tank of petrol worth RM113 within a few minutes
59. A pole platform that cost RM990 was bought for RM30,000
60. A thumb drive that cost RM90 was bought for RM480
61. A cabinet that cost RM1,500 was bought for RM13,500
62. A flashlight that cost RM35 was bought for RM143
63. Expenses for 1Malaysia campaign paid to APCO?
64. RM17 billion subsidy to IPP
65. US$24 million Diamond Ring for Ro$mah - Cancellation of Order - how much compensation?
66. CowGate ... RM250 million
67. Monsoon Cup . . . RM800 million per year
68. Illicit Fund Transfers out of Malaysia (2000 - 2009) : RM 1,077,000,000,000!
69. Tajudin-Danaharta settlement to cover up for Dr M and Daim
70. Billions of ringgit toll concessions that disadvantage the government and taxpayers
71. MUSA-AMAN's Timber-Concessions kick-backs worth $90Million US Dollars into his personal account causing thousands of acres of precious Rainforest in Sabah ( homes of endangered wild life such as Orangutans, Borneo Pygmy-Elephants & the Sumatran Rhino ) to be cut-down....
Wednesday, May 2, 2012
David Dodge in Denial
Usually past Bank of Canada Governors keep their lips closed and sit on their criticisms when they leave office.
Not David Dodge it seems. In a speech in Calgary he wanted to have his say. Basically it boils down to the fact that housing is not in a bubble except in pockets like Vancouver and Toronto, and that is driven by off-shore money, not low interest rates and so interest rates should not be used to try and control housing.
While I agree that there is a significant effect from the HAM Tsunami on the markets, my answer to David Dodge is the graph produced by the Bank of Canada itself (below). If low interest rates are not the problem then why the huge run-up in our consumer debt, considering that only 20% of the population of Canada live in the two most bubbly cities
Not David Dodge it seems. In a speech in Calgary he wanted to have his say. Basically it boils down to the fact that housing is not in a bubble except in pockets like Vancouver and Toronto, and that is driven by off-shore money, not low interest rates and so interest rates should not be used to try and control housing.
While I agree that there is a significant effect from the HAM Tsunami on the markets, my answer to David Dodge is the graph produced by the Bank of Canada itself (below). If low interest rates are not the problem then why the huge run-up in our consumer debt, considering that only 20% of the population of Canada live in the two most bubbly cities
Tuesday, May 1, 2012
The C is Coming Back
What does C stand for? Convicted of Fraud? Ex-Canadian? The Face of bloated Capitalism? Looks like 'the Conrad' wants to come back to the country he foresook and bad-mouthed.
And even though we don't usually let in people with criminal convictions, however minor, money obviously over-rules these genteel considerations.
Frequently critical of Canada and especially those who dared to criticize the US, he eventually renounced his Canadian citizenship - how ironic that he was nailed by the US, our fragmented securities commissions rarely jail such a high-profile, well connected miscreant.
So when he is out of jail, can we expect to see him holding soirees with his nouveau riche wife Barbara? and maybe Macleans can put his porky face on the cover a few times to try and rehabilitate him, and before you know it, he will be back to being the same old arrogant wind-bag telling US how WE should run OUR country...sheesh.
And even though we don't usually let in people with criminal convictions, however minor, money obviously over-rules these genteel considerations.
Conrad was kicked out of the exclusive Upper Canada College after being accused of stealing and selling exams, his father was the president of Canadian Breweries Ltd, his mother was the daughter of the founder of Great West Life.
Frequently critical of Canada and especially those who dared to criticize the US, he eventually renounced his Canadian citizenship - how ironic that he was nailed by the US, our fragmented securities commissions rarely jail such a high-profile, well connected miscreant.
So when he is out of jail, can we expect to see him holding soirees with his nouveau riche wife Barbara? and maybe Macleans can put his porky face on the cover a few times to try and rehabilitate him, and before you know it, he will be back to being the same old arrogant wind-bag telling US how WE should run OUR country...sheesh.
Only a Few Hours left
For comments to the OSFI about the CMHC
If you have a moment send a quick e-mail here:
B20@osfi-bsif.gc.ca
You can mention the $600 Billion Liability that is sitting on our shoulders, the weak, pro-RE CMHC board and the criticisms of risk management heaped on them by the IMF, Nomura, Bloomberg, the Globe and Mail and others.
You can mention that they have distorted their mandate of helping Canadian's buy housing they can AFFORD and have helped fuel the current housing boom which has brought prices to a record lack of afforbility.
You can mention how the CMHC has led to lax lending by the banks, with the same US-style zero down, money back mortgages due to the risk being immediately transferred to the tax-payer. Anything will do. Now is our moment...The prudent, the cautious, those who do not want to put our country at risk of financial ruin.
If you have a moment send a quick e-mail here:
B20@osfi-bsif.gc.ca
You can mention the $600 Billion Liability that is sitting on our shoulders, the weak, pro-RE CMHC board and the criticisms of risk management heaped on them by the IMF, Nomura, Bloomberg, the Globe and Mail and others.
You can mention that they have distorted their mandate of helping Canadian's buy housing they can AFFORD and have helped fuel the current housing boom which has brought prices to a record lack of afforbility.
You can mention how the CMHC has led to lax lending by the banks, with the same US-style zero down, money back mortgages due to the risk being immediately transferred to the tax-payer. Anything will do. Now is our moment...The prudent, the cautious, those who do not want to put our country at risk of financial ruin.
Big Drop in SFH Average
See Larry's Post.
Ok lets not get too excited, we have seen this movie before and it didn't end well. We saw a big drop in mid-2011 only to see it rise like a phoenix to new heights and I am not even talking about 2009 when tweedle-dee and tweedle-dumb rigged the system so that we were denied our correction.
Fingers crossed.
Lets see what the official number say and how the GVREB spins it.
Ok lets not get too excited, we have seen this movie before and it didn't end well. We saw a big drop in mid-2011 only to see it rise like a phoenix to new heights and I am not even talking about 2009 when tweedle-dee and tweedle-dumb rigged the system so that we were denied our correction.
Fingers crossed.
Lets see what the official number say and how the GVREB spins it.
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