Royal Bank

Royal bank is in a PR catastrophe. It wants to outsource the IT Dept to an off-shore company and wants those who will be fired to train those who will take over!

Of course record profits never stops a company from looking for new ways to cut costs, but this one may have been a step too far. I suspect the Royal sees the end of the RE/HELOC/CHMC feeding frenzy, and is looking for some quick savings to try and shore up earnings. The executive suite have a lot of  their compensation tied to the earnings and stock price. 

The CEO owns $33 Million of shares in the company and the rest of the executive suite isn't hurting:

Summary total compensation table

G.M. Nixon

President and Chief Executive Officer 

2009- $12 Million 2010 $11.8 Million 2011 $$11.1 Million and 2012 $12.6 Million

J.R. Fukakusa

Chief Administrative Officer and Chief Financial Officer 

2009 $4.4Million 2010 $3.4Million 2011 $4.5Million

D.I. McKay

Group Head, Canadian Banking 

2009 $3.6 Million 2010 $4.3 Million 2011 $4.8 Million

A.D. McGregor

Co-Group Head, RBC Capital Markets 

2009 $12.9 Million 2010 $10 Million 2011 $8.2 Million

M.A. Standish

Co-Group Head, RBC Capital Markets 
2009 $14 Million 2010 $10.3 Million 2011 $8.3 Million

This does not include severance or pension benefits which will run into many Millions for each of the above.

A few things that I find interesting:

The CEO is not even the most highest paid executive. It is always the head of trading that garners the biggest pay-cheques. In fact there may be RBC traders that make even more that these folks and are not on the reporting list.

In 2009, the executives got the highest pay 12 + 4.4 + 3.6 + 12.9 + 14 = $46.9 Million for the five of them. You remember 2009, the year of the fiscal crisis. 

That was the year that the Government came to the rescue of the big banks, big time. Interest rates where slashed, and CMHC was doubled (I believe late 2008) allowing banks to pass off risk to the tax-payer, and portfolios of consumer debt were purchased to free up bank funds.

SO...while $47 Million is not a huge sum in the self-entitled corporate world, were a single US CEO will pay himself that much in a bad year, the Canadian banks are different. 

Public policy is changed so that they CAN make huge profits, even if that means the risk is moved off their balance sheets to that of the Government (ie us!), so they have some degree of social responsibility. That means not pushing debt to the degree that Canadians are in trouble. It also means not going for the cheapest option at every turn, if it effects the incomes of ordinary employees. I would say they have failed in both capacities.

If things are THAT bad at the bank, how about the capping everyone's salary and benefits at say $3 Million. I mean that is a good chunk of money, unless you are trying to build a dynasty. Then the recipients of pink slips might feel less violated. 

BTW the way all the Executive suites justify their income, is to say.."we have 76,000 employees and so we run highly complex organizations"

For comparison:

The PM of Canada earns about $317 K

The President of the US $450K

The Head of the Salvation Army $130K

Fraser Valley

Summary 

20% less sales than last March

11% less listings than last March

3% less inventory than last March

MOI  is  8.4

Benchmark, the number that keeps on giving...  up a fraction of a % for SFH and Apartments and DOWN 1.7% for attached.

I suspect the criticism of the cannot-go-down-benchmark must have reached the Top brass. 

The President says in his statement..“Inventory levels are not as high as they need to be to put significant downward pressure on prices of the benchmark, or ‘typical’ home. These are homes that have characteristics most common to houses in a given community."

Hmm..with an MOI of 8.4 and sales 70% of the typical March I would suspect there is some downward price pressure. Any Fraser Valley readers out there wanting to comment on what they have seen?

The details are here.

Who has the money to buy?

Lots do!

The median Van West home is a cool $2 Million now. There is a misconception that only wealthy Chinese or those with 'hot' off-shore money can afford these prices.

There are lots of people locally who have an income big enough, say $700K, to be able to afford buying even at these lofty levels.

Some are business owners, but many are professionals who may even be paid by the tax-payer. Eg while the average doctor makes a lot less than this, I hear from my medical buddies (and in fact you can check on-line) that some Cardiologists , Opthalmologists and skin docs are well into this bracket. 

There are many high prices lawyers in this range too, and I am sure the lawyers who got to take the tax-payers largesse in this case and never get audited are in the exclusive club.

In fact the top producing Realtors probably have membership too and there are quite a few stock-brokers who run large 'books', pushing them easily to this level.

My point is there is enough local money power to keep buyers coming in alongside our off-shore arrivals. Not enough however to eat into the 7-8 MOI.

And don't even get me started on some of the over-paid padding that goes on in parts the corporate world. 

This has little to do with RE but humor me please, I lost a good chunk of money on it...

Yellow Media....

The CEO Marc Tellier is leaving after 12 years. He will get a $4.3 Million package, and $450,000/ year retirement pay on top of that when he turns 65 (he is 45 now). Last year his salary and bonus added up to over $1.4 Million. So he is a wealthy man.

Ok you say that's not a big deal. 

A CEO is God's anointed on this earth, they walk on water or at least they think they do, and the Rogers and TD CEOs who are retiring will likely get 4-5X MORE than this guy. 

Also compared with some US or European CEOs who rape their companies, this is loose change!

However I was a share-holder in Yellow media, and I know what happened. Since 2002, Yellow Media has seen it's share-price decimated from several dollars to a few cents. Even the BNN staff reporting it yesterday could hardly contain their shock and amazement at the package.

The Chairman put out a semi-apologetic news release saying they had to pay it per the contract that was signed at the time. There was apparently no clause that stated..'if share-holders are completely whipped, abused and trodden into the dirt, then no severance will be payable to you Mr CEO."

I have a better idea...why don't the Board of Directors who agreed to the contract and the lawyers who advised the company dig into their deeep pockets and pay it themselves.

As for Mr Tellier, this sums it up best. 

Healthy Lunch Round Up

We have made a conscious effort to be healthier this year. We have jumped on the "whole foods" bandwagon and have been buying more organic and sticking to what we call "God foods." Foods that come from the earth and not from a manufacturing plant loaded with nasty, bad-for-you chemicals. We haven't completely knocked out all the junk, but I would say we are 85% there.

I'm so glad that we decided to do this before the kids were older. They are completely on board with the change in our diet. 

It makes my heart swell with pride when they ask for an apple or grapes for an afternoon snack instead of fruit snacks or some other form of junk food.

Their school lunches have had a makeover as well, and I have been sharing them on Facebook.

Since everyone isn't on Facebook...shocking, I know;o)... I thought I would share what the kids have been taking in their lunch boxes.

Shredded Chicken, Organic Crackers, Celery with Peanut Butter, Strawberries, Grapes, and Homemade Cupcake(recipe to follow soon)

 Whole Wheat Pita with bananas and peanut butter, sliced apples, popcorn chips, and homemade Lara Bar(recipe to follow)

 Sliced turkey, organic crackers, homemade whole wheat bread sticks, almonds,  and tangerine

 Ham and Gouda sandwich, carrot sticks, tangerine, and organic trail mix

 Diced baked chicken, cubed mozzarella, homemade pumpkin and chocolate chip muffin, carrot sticks and strawberries

 Sliced turkey, almonds, carrots, organic crackers, homemade applesauce, and tangerine

 Homemade chicken nuggets(recipe to follow soon) sliced carrots, sliced cheese, and strawberries

 Whole Wheat Waffle with homemade peanut butter, zucchini muffins, crackers...etc.

Do you feel inspired to start making healthier lunches for your family?

Have you jumped on the whole foods bandwagon? What are your kids' favorites? As you can tell, we go through a lot carrots:o)

We also supplement our diets with a drink called Smart Mix. It's a nutritional drink that we have been taking since last November, and we are healthier than we have ever been. I am such a believer in this product, I decided to become a distributor for the company who produces it, Zija.

My kids ask for it every morning, and that is a huge relief, since I could never remember to give them their vitamins.

I have added a link on my side bar which takes you directly to my website to find out more about this amazing product line. It looks like this:

I am also going to be making a few changes here on the ole blog, and I will be discussing more health and nutrition along with the crafty stuff. This is a major part of who I am, and I would like to share that side as well. So I hope you'll stick around!!

Whistler Downhill Slalom

We know Whistler has been in bad shape for a long time. Americans left a long time ago, Chinese are not interested yet, and baby-boomer demographics are working against the lofty prices.

It is a great winter resort but there is no reason to pay $1000/foot to get a few two-by-fours there.

Well things have gone a lot further downhill than I had thought. MINUS 11% , 12% and 43% are the 5 year benchmark returns according to the REBGV stats for detached, attached and apartments.

The media has also woken up to the carnage:

Whistler real estate prices plummet up to 68 per cent from CTV (hat tip Sothseacompany on Vancouver condo)

Interesting that they go to Tsur Sommerville for analysis and commentary and explanation. Why the media go to the same few names baffles me. Did Tsur say Whistler is going to take a big fall? Maybe he did and I missed it and I stand to be corrected.

But if he didn't, THEN WHY GO TO HIM FOR ANALYSIS NOW??

If a guy didn't call the big fall, then how valid is his opinion? Much more valid to contact a David Madani or Garth Turner who have been calling for this, than the guys who have taken the other side IMVHO.

This is how it ends:

Whistler realtors told CTV News they’re seeing momentum in some areas, and Sommerville said there could be a resurgence in prices as the U.S. economy picks up steam.

“If we’re having this conversation in a year or two from now it would be a different dynamic,” he said. “We would be talking about Whistler’s recovery rather than Whistler being in the doldrums.”

OK Tsur, we will revisit this annually and see if your prediction is right and I for one am willing to eat humble pie if I am wrong.

Easter Outfits-Boy's Vest and Bow Tie

I shared with you guys the other day S.R.'s Easter dress, and today I wanted to give you a closer look at E's vest and bow tie.

This has to be the easiest thing to sew for little boys, and it looks so cute! 

I purchased the vest pattern last year when the kids' were in my uncle's wedding.

I lost the instructions somewhere in my craft closet, but thankfully found the right pattern pieces to make the vest..and to answer your question, yes, my craft closet is a disaster, and no, I never put anything away where it belongs. I work in total chaos;o)

 The fabric was purchased from Hobby Lobby. I bought 1 yard, and after using my coupon, it came in at just under $5. Not bad, eh?

The bow tie has velcro on the ends to keep it closed around the neck. 

I really need to do a tutorial on how to make a bow tie. You wouldn't believe how easy it is to make these things!!

 Little man loved this outfit, and it always makes me proud when they get excited about what I make for them:o)

Have a great day, and make sure to smile big;o)

Easter Outfits-Easter Dress

We had a wonderful Easter. A time of catching up with family and friends, eating way too many delicious foods...courtesy of my mother, and remembering the resurrection of our Lord and Savior:o)

 I hope all of you had a wonderful weekend as well. 

 I gave a sneak peak on Facebook last Friday of the kids' Easter outfits. This week I will be sharing what I made for both of them.

Today's focus is on S.R.'s dress. 

Thankfully I had all the materials on hand, so this dress was completely free. Yay, for free!!

 This dress is extra special...

 All of the bead work, which was hand-sewn onto the dress(ugh!), came from my mother's wedding gown.

I took extra care in making sure that this dress will last, so that we can hopefully pass this on to my brother and sister's "someday" children:o)

The bead work went across the bodice...

and across the bottom of the skirt.

 Here's a quick look at the back. An extra long sash for the finishing touch.

 My children are carbon copies of the hubs and me...even down to how we take our pictures...it scares me how much my daughter is like me;o)

 Every once and a while we can get E to loosen up as well:o)

Come back for a closer look at E's Easter Vest and Bow Tie....

Participating here: