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Tuesday, January 31, 2012

A few words...


I just wanted to take a moment to thank all of you who left comments and sent emails.

I simply have not felt like posting this past week.  Those of you with cherished pets understand.  They become members of the family and their loss is deeply felt.

Thank you. 

I hope to have a post for tomorrow.

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Tuesday, January 24, 2012

Will be back shortly...



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Friday, January 20, 2012

Global Deleveraging only just begining


McKinsey & Company is a global management consulting firm which bills itself as "the trusted advisor to the world's leading businesses, governments,and institutions".

In a report released today, McKinsey notes that total debt to GDP has declined in only three countries since the 2008-09 crisis: the United States, South Korea, and Australia.

As we all know Canada has not only NOT seen their total debt to GDP decrease, it has hit historical highs.

In fact, total debt has actually grown in the world's ten largest mature economies due mainly to rising government debt - Keynesian style.

McKinsey notes that the US is following the two phase deleveraging process that 1990s Finland and Sweden followed but point to the household segment as leading the way with 15% reduction in debt to disposable income (driven unsurprisingly in major part by mortgage defaults).

The bottom line in the report is that US (households) are at best one-third of the way through their deleveraging and the UK (financials) and Spain (non-financials) face much more significant pressures (which will inevitably impact aggregate demand given governmental borrowing pressures) as their deleveraging has only just begun.

It's interesting that McKinsey mentions Australia.

Faithful readers know that for the longest time Canada and Australia stood above other countries in the Western world for having seemingly escaped the imploding real estate bubble.

Both were viewed as commodity rich countries which were being fuelled by Hot Asian Money.

Both real estate markets were - supposedly - immune because of rich Asian buying up land there.

But as we have noted numerous times on this blog, 2011 was a turning point for R/E in the Land of Oz.

And perhaps nothing hilights this fact more than real estate auctions in Australia.

Unlike North America (where auctions are used to sell distressed and foreclosed properties), the use of auctions in Australia is one of the main means of housing sales and their results are often a barometer of the market’s strength. Aussie newspapers even devote entire sections to auction sale results.

But 2011 saw the reality catch up the housing market in Australia and after home prices fell the most in at least 12 years in 2011, home auction results foreshadow another year of declining Aussie home prices.

According to Bloomberg the Aussie auction sales are tanking. Peter Green, a principal at Australian property broker Laing+Simmons, “in the last three months, the number of people visiting open houses has been cut by half. And buyers may show up to auctions, but they don’t bid.”

Half of the homes that went to auction in December failed to sell.

Bloomberg notes Australia escaped the housing rout seen in the U.S. and Europe, in part due to government measures to boost demand in the wake of the collapse of Lehman Brothers.

As we all know, this is exactly what Canada did too.

In 2011 Aussie housing prices recorded the biggest drop since Brisbane-based RP Data began compiling figures in 1999.

For years Australia has used the rationalization of money from China as the reason their housing bubble will not implode. But now Australia has begun their develeraging process.

Will Bloomberg be writing about Canada next?

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Thursday, January 19, 2012

SOPA and PIPA - are you aware of what's going on?

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Tuesday, January 17, 2012

Tues Post #3: Ron Paul Dominates Fox's Twitter Survey Of The South Carolina/FOX News Debate


It is almost comical to watch the mainstream media's coverage of the stunning movement afoot towards Texas Congressman Ron Paul's campaign for the Republican Presidential nomination.

When FOX News conducted a Twitter survey of the South Carolina debate (and Ron Paul dominates), watch how they try to dismiss the Survey results as a poor reflection of what people think.

When the show's co-host calls him on this - pointing out that Ron Paul is not just 'doing better' than the competition... but out and out 'did the best' - it's almost painful watching the FOX host begrudgingly have to admit this is true.

Below are Ron Paul hilights from the debate.


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Tues Post #2: A Tsunami of listings flooding market?


"If you are a seller - list now!"
                                                                            
                                                                     - Ozzie Jurock newsletter advice 
                                                                        January 7, 2012


Our friends over at Vancouver Condo Info keep track of the daily R/E numbers and the emerging story is quite fascinating.

In 2011 there was not one single day where the number of new listings exceeded 400 in one day.

In January 2012 the listings have been coming fast and furious.  On Monday those listings crested that magic 400 mark as Vancouver had 428 new listings on Monday alone (with only 65 sales). For reference in 2011 the most listings on any single day in Vancouver for the month of January totalled 292 (Jan. 17, 2011).

Even in Richmond, another haven of Hot Asian Money last year, there have been 534 new listings from January 3-16 (with only 85 sales).

Where is this going?  It's still to early to tell but I suspect a lot of sellers are sure relieved to see the banks engaging in an interest rate war with each other (as noted yesterday).

Less than enthralled with the bank's interest rate war is the IMF.  As the San Francisco Chronicle notes
the IMF is concerned the record low interest rates are combining with record household debt to pose a significant risk to the economy with excessive speculation.

Will these moves blow the market even higher?

Will demand be offset by a surge of sellers willing to cut prices to take advantage of a market flush with greater fools jacked on cheap money who are all to willing to inflict 'cashtration' on themselves?

Time will tell.

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Tues Post #1: Battle of the bank rates


A few days ago we told you how Ozzie Jurock was advising his followers that while Vancouver's real estate prices were basically the same this December (2011) over last December (2010), Jurock gave some uncharacteristically negative analysis:

"Well, YES (Vancouver prices are the same this December over last December) ... BUT the December average price of $ 691,000 is a whopping $141,000 or a full 17% lower than the May 2011 average price, which clocked in at $834,000. In fact overall sales decreased 13% over last December but a WHOPPING 34.1% decrease over the 2,515 residential sales in December 2009. Sales of detached properties a decrease of 18.1% from the 769 detached sales recorded in December 2010, and a WHOPPING 30.2% decrease from the 902 units sold in December 2009."

BMO Capital Markets has now come out with their most recent analysis and they expect the December sales to be up 3% compared with a year ago and the average price to have gained 4%.

“Below the surface, however, the story gets a tad more interesting,” economist Robert Kavcic wrote in a report.

Kavcic noted the formerly white-hot Vancouver market is now cooling with sharply lower sales and with prices coming off their highs.

“Looking ahead to 2012, cooler housing activity should prevail as elevated household debt levels, shaky confidence and a weakened job market counter extremely low mortgage rates.”

Mortgages, however, mean revenue for the banks.  

And as the battle for customers intensifies amid a drop-off in consumer borrowing, those very banks are in the process of launching a a counter offensive to combat that shaky confidence and weakened job market.

Some of Canada’s biggest banks are now advertising promotional ultra-low mortgage rates to win market share.

The Bank of Montreal began the offensive with a special discount five-year fixed rate at 2.99% for a limited time.

TD Bank responded with a four-year special fixed rate at 2.99% available until the end of February, while Royal Bank later matched that with its own four-year 2.99% rate offer, along with a seven-year special fixed rate of 3.99 per cent.

In 2008/2009, when the market weakened as the Financial Crisis began, emergency level interest rates were the market saviour.

Without the expected worldwide economic recovery taking hold yet, will interest rates even LOWER than emergency level rates be the panacea?

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Monday, January 16, 2012

Mon Post #2: Ron Paul - the emerging Republican nominee?


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Is January shaping up to be a Real Estate disaster in Greater Vancouver?


Over the past two weeks we have seen a seemingly endless stream of negative Real Estate items, including the stunning recommendation from R/E optimist Ozzie Jurock that if you are a seller - list NOW!, if you are a buyer - hold off.

You have to wonder... what will be the impact on buyer psychology of all this bearish analysis?  I mean... who wants to catch a falling knife, right?

Indications from those close to the industry indicate that last week's numbers were absolutely brutal for the R/E industry.  Over on the blog, Vancouver Condo Info, this sentiment was echo'd by contributor ZRH2YVR who says: 
  • "Sales at this time of year are typically slow, but the level of sales now is only a trickle. There is a definite indicator that the areas which have spiked last year are no longer the hot areas. Inventory of the market is high for this time of year and listings are coming in at record pace for January."
He predicts that Greater Vancouver could exceed the highest inventory on record which occurred in 2008. Those on the blog who track daily inventory and sales numbers report that the Greater Vancouver inventory total soared to over 12,000 listings last week.

While the month is only half over, Vancouver West detached sales are on a pace to see a 66% decline for the month of January. Vancouver's two closest suburbs are on track for an equally dismal performance: Richmond is on track for a 51% decline in detached home sales and Burnaby for a 59% decline.

It will be very interesting to watch the impact of all the negative stories in the mainstream media on the real estate market for the rest of the month.

There is no doubt, the swirling tides of change are brewing in the market.


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Saturday, January 14, 2012

A sign of things to come?


Real Estate watchers in the Village on the Edge of the Rainforest have seen high end properties in Vancouver shoot up over the past couple of years, but not everything has been making stunning gains.

And as all signs point to a looming market correction, there has been an interesting development.

The Penthouse at Shaw Tower in downtown (1077 West Cordova) sold this week.


Billed as Vancouver’s tallest waterfront tower, the Penthouse at Shaw Tower features panoramic unobstructed views of Burrard Inlet, the Five Sails of the Vancouver Convention Centre, Coal Harbour, Stanley Park, Lions Gate Bridge, English Bay, Downtown City Lights, and Mount Baker.  

The Penthouse suite occupies a full floor of the Shaw Tower and this has 4 bedrooms, a home office, climate controlled wine room, media room, and multiple large decks.  The interiors feature limestone flooring with radiant heat, custom wood mill work, chef’s kitchen, limestone gas fireplace, art feature walls, onyx, limestone, mill work closet systems and automation system, sunshades and blackout shades, security system, private hot tub, built in BBQ.  


The home comes with 4 parking stalls and private storage room.  The building has concierge service, gym, and private boardroom and home theatre.  Realtors bill it as a unique opportunity to own the most stunning penthouse in Vancouver.

The problem?

The property has languished on and off the market now for almost four years.

Back in May of 2011 it hit the market with an asking price of $19,800,000. The price was dropped to $15.5 million with not takers.


The media reported the sale as a property that sold for 2/3rds of the asking price ($15.5 million down to $10.1 million) but when you take the asking price from May 2011 into account, it's almost a 50% drop.

Is this a portent of what's to come in Vancouver?

Hard to say.  A property is only worth what someone will pay for it and we have seen some real outlandish asking prices.  The real question is, what did the owner originally pay for it?

Is the $10.1 million sale price a gain or a loss? Did the owner dump the property because all signs are pointing downward?

We're not sure. But what does stand out is that the asking price had to be slashed in half to complete a sale.

Maybe Royal Bank (contrary to Phil Soper) was valid in preparing for a 25% real estate correction.

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Friday, January 13, 2012

The Dollar dump continues


Last Saturday we made reference to a Zero Hedge article that commented about what was then a record $77 billion in Treasury sales from the Fed's custody account.

The obvious conclusion from that data is that, contrary to what one hears in the media, foreigners are offloading US paper hand over fist.

ZH then wondered, if Treasurys are being dumped, "what they are converting the USD into, and how much longer will the go on for? The last thing the US can afford is a wholesale dumping of its Treasurys."

The concern is that the traditional diagonal rise in foreign holdings of US paper has not only pleateaued, but it is in fact declining: a first in the history of the post-globalization world.

Well here we are a week later and as of yesterday's H.4.1 update, the outflow has increased to it's 6th consecutive week by yet another $8 billion to a new all time record of $85 billion.

The 6 consecutive weeks of outflows is now tied for the longest consecutive period of outflows from the Fed's Custody account ever. 

This week's sale brings the total notional of Treasurys in the Custody account to just $2.66 trillion (down from a record $2.75 trillion) and the same as April of last year. 

And since the sellers are countries who have traditionally constantly recycled their trade surplus into US paper, this is quite a distrubing development. 

As ZH notes, it is getting increasingly more difficult to ignore this disturbing trend, especially with US bond auctions mysteriously pricing at record low yields month after month. 

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Thursday, January 12, 2012

The Empire Strikes Back


The first two weeks of 2012 have given us a plethora of bearish items on Real Estate.

From the nation's largest bank, who tells us it is so concerned about a significant real estate correction that it has stress-tested itself for a 25% collapse... to the uber-R/E optomist Ozzie Jurock who exhorts to his followers:

  • "if you are a seller - list now! If you are a buyer, take your time, the market will not run away from you."

The damage all this negative press must be doing to that all important metric known as 'buyer confidence' must be immense.

Let's face it... who wants to catch a falling knife?

So it should come as no surprise that we would see some push back in the media from those most affected by all this negative hype.

And - almost as if on cue - along comes real estate giant Royal LePage to counter these damaging developments to it's business.

Headlining "More Gains in Home Prices Expected", LePage's CEO Phil Soper is quick to dismiss all this negative talk which might lead some to hesitate from buying (and subsequently hurt his company's commissions).

"Widespread calls for a major real estate correction in 2012 simply can't be justified," Soper said in a statement. "The industry has significant momentum entering the year, and buoyed by the stimulative effect of very low interest rates, we expect the market to continue to expand — albeit at a slower pace."

Soper is adamant that Canada's housing market will continue to be strong this year, with rising property values expected in ALL major markets and his company is forecasting prices to rise 2.8% nationwide by the end of 2012.

And bucking the consensus of virtually everyone else, Soper insists that even the pricey housing markets of Vancouver and Toronto will see continued price appreciation this year.

I suspect Royal LePage et-al will now strike back with a massive - and none too subtle - media campaign to influence that all-so-important 'buyer confidence' in a desperate attempt to negate the negative outlook currently being propagated.

Let's see how long before the major papers are 'influenced' into running those cutsie little profiles of prospective buyers who see this as an 'awesome' opportunity and time to buy.

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Wednesday, January 11, 2012

Are Canadian Banks preparing for a housing collapse?


With each passing day of 2012, the real estate situation grows more and more intriguing.

Yesterday it was the stunning comments of Ozzie Jurock that grabbed out attention.

Today it is the actions of the Royal Bank of Canada.

During 2011 there was no mention from Canada's largest bank that potential disaster looms on the horizon.

Yet RBC CEO Gordon Nixon let slip at an investor conference in Toronto on Tuesday that Royal Bank of Canada is not only concerned, but has taken the unusual step of conducting stress tests on its books to see how Royal would withstand a decline in housing prices by as much as 25%.

Nixon is quick to point out that the bank doesn’t figure the situation will become that dire, but he is concerned enough that he has investigated whether RBC's lending operations could withstand such a large hit if one were to occur, particularly in the Vancouver and Toronto condominium markets.

The bank’s exposure to the Canadian condo development market is about $2-billion, Mr. Nixon said.

No matter how you spin it, this is a stunning development.

Yesterday perennial R/E cheerleader Ozzie Jurock astonished local observers by telling followers to ignore that fact that Vancouver prices are the same this December over last December and to focus on the fact that:
  • the December average price of $ 691,000 is a whopping $141,000 or a full 17% lower than the May 2011 average price (which clocked in at $834,000).
  • that overall sales decreased 13% over last December and were a "WHOPPING" 34.1% lower than in December 2009. 
  • and that sales of detached properties decreased 18.1% from the sales recorded in December 2010, and were a "WHOPPING" 30.2% lower than in December 2009.
Over on the blog, Vancouver Condo Info, the conversation focused on the dramatic numbers coming out in local real estate.

Noting that it’s normal this time of year for listing to outnumber buyers as people who haven’t managed to sell relist their property, the observers at VCI are taken aback at just how significant the ratios are.

Leading the pack were the numbers for the westside of Vancouver with 96 new listings, 10 price changes and an astonishingly paltry 5 sales.

The author of the post says, "Yes, that’s right. 96 new listings on the west side of Vancouver on one day and only 5 sales. Any idea whats going on here? Were there so many listings that all the sales didn’t get entered, or did we really just have crazy sales/ list ratio day?"

As we noted yesterday, Ozzie Jurock may have provided the answer when he suggests to all who will listen that, "if you are a seller - list now! If you are a buyer, take your time, the market will not run away from you."

And with Canada's largest bank testing the waters to see how they would withstand a housing collapse of up to 25%, one can only imagine that those list/sell ratios will intensify dramatically.


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Tuesday, January 10, 2012

Everyone's a bear now - even Ozzie Jurock?



As mentioned several times over the last week, everyone seems to be coming to the realization that the Real Estate market is in for a correction.

Douglas Porter, deputy chief economist with the Bank of Montreal says, “while the timing of said slowdown remains up in the air (and it’s no foregone conclusion it will start this year), it is highly unlikely that Canada’s housing market can continue its recent winning ways.”

Porter’s colleague at BMO, senior economist Sal Guatieri, doesn’t expect the “nastier” turn, saying in a separate report that the market is losing steam, and that valuations remain a worry, but that there will still be “modest gains” in overall sales this year, along with steady prices.  "If you listen closely you can hear the sound of air seeping out of Canada's housing balloon," Guatieri said.

Jacques Marcil, senior economist of Toronto-Dominion Bank, believes housing markets will weigh on the economies of British Columbia and Ontario and he projected a “significant correction” this year, noting that the hot Vancouver market probably peaked in 2011.

Even the Real Estate Board of Greater Vancouver reported this week that sales last year climbed 5.9% from 2010, but slowed at the end of the year. Sales in December fell 12.7% from the same month a year earlier. And while prices were still up by 7.6%, the REBGV tells us they were 1.5% below their peak of June, 2011.

But perhaps most astonishing is to see even Ozzie Jurock cast disparaging words on the ever inflating real estate market.

Jurock headlines that Vancouver prices are the same this December over last December but then goes on to give you some very bearish analysis which includes some very uncharacteristic negative comparisons:

"Well, YES (Vancouver prices are the same this December over last December) ... BUT the December average price of $ 691,000 is a whopping $141,000 or a full 17% lower than the May 2011 average price, which clocked in at $834,000. In fact overall sales decreased 13% over last December but a WHOPPING 34.1% decrease over the 2,515 residential sales in December 2009. Sales of detached properties a decrease of 18.1% from the 769 detached sales recorded in December 2010, and a WHOPPING 30.2% decrease from the 902 units sold in December 2009."

Jurock even goes on to offer you some very bearish advice.  "If you are a seller - list now! Prices usually rise January to May as do sales... and fall after that. If you are a buyer... take your time... the market will not run away from you."

Imagine if everyone were to follow Ozzie's advice, i.e. a rush of listings while buyers patiently wait and stay away?

It could make for a very interesting spring.

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Monday, January 9, 2012

'BC to face a significant correction in 2012' - TD Bank


We didn't get around to it, but last week economist from another Canadian bank came out forecasting trouble for BC Real Estate.

TD Bank predicts BC will face 'real estate trouble' over the next two years but attempts to soften the blow by saying CANADA will not suffer a bust in the housing market.

Comforting, I guess, but let's face it... the rest of the nation is nowhere near the type of bubble we have here on the left coast.

Perhaps that's why TD added that, "British Columbia is forecast to have it worse and will likely see a signifcant correction this year". 

Strong words but what is 'a significant correction'?

The TD report examined the country's provincial economies and projects home resales in British Columbia to sink 3.7% this year and prices to decline 3.5%. The report also talks about 2013 and says, "the correction will extend into 2013, as unit resales fall a further 5% while prices slip 4.4%."

So TD see's the market dropping over the next two years and that prices will drop 8%, a correction TD calls 'significant'.

8%?... is that really 'significant'?

Perhaps what is more significant is the growing consensus that the housing market is going to suffer a downturn.

When even the banks are telling you that houses are going to be cheaper a year from now (twice as cheap two years from now), do you buy?

And with sales down 12.9% in Greater Vancouver last month, will even more buyers shy away from the market in the months ahead creating even more intense downward pressure on prices?

The first six months of 2012 are going to be extremely interesting to watch.

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Sunday, January 8, 2012

If the US walked into the bank and asked to raise their 'debt limit'...


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Saturday, January 7, 2012

Is a US dollar dump underway?


Zero Hedge notes the US Federal Reserve provides a weekly update known as the H.4.1.

Observers of the Federal Reserve's Custodial Treasury account follow these updates with keen interest. Recently they have been somewhat perplexed.  There has been a continued, weekly selloff of $56 Billion of US Treasury's.

Is the continued drop an asset rotation - under duress or otherwise - out of bonds and into stocks, to prevent the collapse of the global ponzi? Or, as Zero Hedge pondered, has the dreaded D-day in which foreign official and private investors finally start offloading their $2.7 trillion in Treasurys with impunity arrived?

Recall that a few months ago China has made it abundantly clear it will sell its Treasury holdings, the only question is when.

The most recent came out on January 4th and a further $17.7 billion has been "removed" from the Fed's custodial Treasury account.

The alarm bell that is going off her is that in six consecutive weeks, foreigners have sold off more government bonds in a sequential period of time than ever before. It means that someone, somewhere is very displeased with US paper, and, far more importantly, they want to make their displeasure heard loud and clear.

It is an interesting development worth watching.  The consolidated outflow notional is now a record high $77 Billion (beating the previous record of $52 Billion). Should the selloff accelerate, look for the Federal Reserve to have to step in.

The real question is what they are converting the USD into? And how much longer it will go on for?

The last thing the US can afford is a wholesale dumping of its Treasury's. The traditional diagonal rise in foreign holdings of US paper has not only pleateaued, but it is in fact declining: a first in the history of the post-globalization world.

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Wednesday, January 4, 2012

The Outer Limits


If there is a theme to the 2011 year for Real Estate in British Columbia it is how Vancouver reached new all time highs while the Outer Limits (anything outside Greater Vancouver) languished.

And nothing highlights that trend more than Victoria.

The Victoria Times Colonist newspaper reports today that the city's home sales tumble to 11 year low.

According to year-end figures from the Victoria Real Estate Board, 2011 bore witness to the lowest total number of unit sales in 11 years. And last year's 3,069 single-family home sales was the lowest since 1990. 

Victoria Real Estate Board president Carol Crabb says the reason for the dramatic drop ranges from  global economic uncertainty to people waiting and hoping to see prices fall.

"The whole feel of the market has shifted a little," she said. "It has slowed down. People are taking longer to make decisions, though I'm not sure why when interest rates are so good. But there is some uncertainty out there."

It's a scenario that sounds eerily like the United States where record low interest rates have simply failed to resuscitate a collapsed real estate market.

One certainly has to wonder if the beginning of the collapse in, in fact, upon us.

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Tuesday, January 3, 2012

Will we watch a Trillion dollars go poof?


The B.C. Assessment Authority posted 2012 assessment information today and the 1.9 million properties in British Columbia have a combined assessed value of more than $1 Trillion dollars. 

Wow.

BC homeowners sure are wealthy, right?

Consider, however, the stunning debt ratio and burden Canadians are carrying.

How much of that $1 Trillion is leveraged out due to HELOC's?

How much credit card debt are we carrying?

And like Nortel stock, what happens if price plummets precariously?  You 'assets' evaporate while your debt remains.

It's a good thing real estate never goes down. 

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Monday, January 2, 2012

Mon Post #2: On the Precious Metals front...


There has been considerable angst over precious metals with the latest slam from the MF Global fallout during the month of December.

Above is a great clip with Peter Schiff who reiterates what we certainly believe, which is that the long term outlook for both Gold and Silver remains bullish.

None of the fundamentals have changed, none of the conditions have improved... so the outlook remains the same.

One interesting comparison you might find useful is too look at the price of Gold as of December 31,  2011 (which is down almost $400 from the $1900+ highs it hit during the year) and compare that December 31 price with the price of Gold from December 31's of years past:

2000 -- $273.60
2001 -- $279.00
2002 -- $348.20
2003 -- $416.10
2004 -- $438.40
2005 -- $518.90
2006 -- $638.00
2007 -- $838.00
2008 -- $889.00
2009 -- $1096.50
2010 -- $1421.40
2011 -- $1566.80

Gold continues it's bull run and will do so in 2012.

Here is a great chart analyzing the 'corrections' over this time period (click image to enlarge):


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Monday Post #1: On the Real Estate front...


Happy New Year everyone. First up this week is information on the Real Estate front.

With almost everyone now seemingly calling for a correction of some kind the data for the month of December 2011 is keenly anticipated.

Realtor Larry Yatkowsky is out with his latest graph (click image above to enlarge) and looking at the figures for Single Family Houses (SFH) you certainly have to wonder if the long anticipated correction may have begun.

The average price for SFH's dropped a significant 6% month over month (from $1,134,396 to $1,064,249). This drop means SFH's are now down a total of 13% from their peak highs. Our friends over at VREAA have laid out that drop month by month:

May 2011: $1,223,421 *Historical peak
June 2011: $1,215,265
July 2011: $1,133,357
August 2011: $1,162,242
September 2011: $1,104,896
October 2011: $1,162,349
November 2011: $1,134,936
December 2011: $1,064,249 (down 13% since peak)

As you can see it isn't a straight drop, but it is a stunning 13% decline from the high of 7 months ago. Another interesting statistic is Inventory.

When you compare December of 2011 to December of 2010, the total inventory for sale is up 17%. Meanwhile total sales are down - also by 17%. While December is always considered a slow month, this large boost in inventory with a corresponding drop in sales activity is significant. And the downward trend on the average price graph certainly stands out and captures your attention.

All eyes are now focused on the Spring market. Will the number of listings start to accelerate with listings ballooning in January, February and March? Will sales continue their downward slide as buyers hesitate for fear of catching a falling knife?

And what of the growing number of Boomers approaching retirement - 70% of whom lack sufficient funds for the Golden Years and whose entire retirement 'plan' lies solely in selling their bubble value property to cash in on those gains and downsize?

Will there be a rush to list and complete a sale even if it means accepting significantly lower offers beyond the current 14% drop from the bubble highs? They would still be making a massive profit over what they paid 30 - 40 years ago so the ability/willingness to accept what would currently be considered low-ball offers is there.

We continue to watch with fascination. 

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Email: village_whisperer@live.ca
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Sunday, January 1, 2012

Happy New Year


To all of you out there, Happy New Year and all the best in 2012.

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Email: village_whisperer@live.ca
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