“Am I Buying This Home To Use It, Or For Anticipated Price Growth?”

Gambling chit or home?

“Average prices in British Columbia are forecast to grow 2.2 per cent this year and remain unchanged in 2018, CREA said.”
– from ‘CREA cuts 2017/2018 outlook for home sales in Canada’, G&M, 15 Sep 2017

“Paradise, meet purgatory: Average Metro earner reaps $72,000 a year, pays $1.4 million for a home”
headline from The Province, 14 Sep 2017 [hat-tip to brian]

In a market that has come to expect 7% growth p.a. (with peaks to 25% p.a. being seen as normal) a substantial period of flat price growth will feel odd; almost like a contraction.
The eternal question for Vancouver RE is: “Will people be willing to step up and buy if prices are not rising?”
This is the essence of our longstanding belief that “all buyers are speculators” — we believe that people buy at these price levels not for utility, but largely for anticipated price growth. We believe they certainly would not be buying without anticipated price growth.

So, what will happen to Vancouver RE prices if prices stop rising? What happens if the speculative component of buying disappears?
We believe that this will result in prices dropping to a level that reflects the value of the utility of the property, and that currently such values are far, far below asking prices.

It’s too early to say, but it does seem that prices in some sectors of the market have stagnated.
Talk at the corner of Rumour & Grapevine is of $3M, $4M, $4M+ – ask-price homes getting no interest whatsoever, and being removed from market. Also of condos over $1M getting little interest. If the supply of eager buyers is limitless, why is this happening?
Perhaps that house isn’t ‘worth’ $4.5M if there is no longer a chance of it being ‘worth’ $5.5M next year. Perhaps its actually ‘worth’ closer to $1.5M (a price that would already value it richly for its actual utility), or even (preposterously!) $1M if we consider local incomes and historic norms. [This argument can be scaled for all levels of the market].

– vreaa

Postscript anecdote:
“I’ve started my active research in the detached market in my area. Inquired today about a detached 3br house in Langley (BC) nice neighbourhood, south-facing yard. Last Saturday we missed the open house, so I called the following Wednesday and inquired if they had taken any offers. “They listed after the long weekend and were going to take offers on the Tuesday but received no offers.” To which I replied “So do you think we could offer below asking, if we were interested?” He replied “Oh yea, definitely.”
– from PupPatrol 09.15.17 at 6:04 pm at greaterfool.com

124 responses to ““Am I Buying This Home To Use It, Or For Anticipated Price Growth?”

  1. O there will be a further wave of buyers because we have immigration. With geoplpltical issues, buyers will flock to Vancouver. We will still double at least from here.

    • Five years ago I might have disagreed with you. But after seeing what’s happened since the Olympics. Sure, why the hell not?

      I can only say that I count my blessings having moved away from Vancouver to a city with far more jobs in my field and a far more sane housing market.

  2. This is a story about a guy who is a small scale speculator, at least relative to a developer. Nothing small scale about the dollars involved. Interesting point of view, driven by the belief that in the long run there will be no single family homes left in the city of Vancouver. Upzoning has already created many paper and real millionaires. Does anyone see this trend stopping.


  3. @vreaa, question, if you didn’t buy a house, are you speculating? I could argue just as well that you are speculating in Canadian dollars because let’s face it, however you hold your wealth, it is a speculation. If you hold it in cash, it means you think the value of your cash is going to keep more than another asset which it is in. So actually I have news for you, you are right that every buyer is speculating, problem is that it can be said of anyone. As long as you hold a storage of wealth (cash is one such storage), you are speculating. Unlike paper money, your property (as long as it is a SFH), cannot be reprinted like Canadian dollar can at the whim of a bank. This is just food for thought. Btw, can you imagine a world when settlement time for ETF’s are say instantaneous. Then why would you even hold cash, wouldn’t it be better to hold a ETF of say S&P 500 instead? One is a piece of paper that has no real value the other is an instrument that actually pays you. I think one of the reasons why you are seeing S&P 500 at such a crazy level is that people are realizing that it is far better to hold an instrument that pays you rather than the instrument that does not. Le’ts not even get into bitcoins.

    Anyways, back on topic, one other problem. Why do people constantly assume that price to income ratios have to be calculated off of two things (1. Price to local income reported to CRA 2. Price to household income assuming house holds are two people ). I think I have demonstrated that vancouver demographics are shifting and the idea that you only have two incomes to support the property is a north american / european concept. Asians don’t like to use this. Actually, we could use it, then we would end up with ratios like 19:1 ala hong kong (guess what, that is what vancouver is looking like more and more isn’t it)?

    At some point realize is this, you can analyze the numbers all you want, but you should ask if it was all interest rates how come Edmonton or Calgary, or Montreal, or insert another city in Canada don’t have this issue. Why here. Maybe it is caused more by the way people culturally have behaved and how the buyer base has shifted from the one that historically buys here. If you don’t believe me, go to an open house today versus one that was pre-2000. See how different it looks.

    • Very well put Brian. Bears are also speculating like the bulls. You could say that bears speculation is less risky because there is no borrowing. But after 10yrs of price tripling, that is very little comfort to the bears.

      And yes, one can crunching data & numbers all day long, but if one doesn’t look like at the context or at least aware of it, any conclusions drawn from it isn’t likely to be very useful.

    • Thanks for the comment, brian (and thanks to all other commenters, for that matter)…

      [There is a risk of a semantic problem here (in that ‘speculating’ can also be defined as ‘forming a conjecture about something’ as well as ‘investing with the hope of gain’). ] That aside….

      By your logic, people who don’t buy bitcoin are ‘speculating’ that their cash will end up being more valuable than bitcoin…. Ok, fine, if that is how you want to define speculation.. (but it’s not how we would define it.)
      ((BTW, we’ve always know bitcoin’s true value was zero.. watch as it now approximates that.. with gyrations along the way.))

      Regarding household incomes: we’d be quite happy for the statistics to reflect true household incomes (however many people were earning per household…) but I think you’d still find that Vancouver household incomes don’t come anywhere remotely close to supporting current RE prices..

      The reason that Vancouver has a greater housing bubble than other parts of Canada is that, yes, as you often point out, there has been (1) more direct importing of money from Asia to Vancouver, but, (2) (and perhaps more important) the Vancouver STORY that Asian money would inflate prices to the sky, forever, and ever. It is this STORY that has caused LOCALS to use large mortgages to buy $3M or $4M houses in the belief that they will be worth $4M or $5M in a year or two (we know of actual examples, this is not fabrication), and to “get in at any price” for fear that prices will rise forever.

      • @vreaa, that’s an interesting reply. I have always enjoyed that our discussions on the subject has been civil unlike on other boards such as vci. I give you all the credit to that by the way.

        I beg to differ on why we are different but do concede that to say there is no pure speculative element in van re is impossible. However, I do personally believe demographic shift is a bigger factor, time will tell.

        Bitcoin, now you have opened a can of worms. I want to dive into this a bit. I personally don’t have a formulated opinion right now. I have not done the research. My original gut feel was exactly yours. However, one of my buddies studied the subject for a year. His arguments are as follows:

        Bitcoin is a purely storage of wealth. Its value, like gold, like actual coins, etc. derives from the recognition that it is of value. In reality, gold has little real uses that justifies its current hyper inflated value. We could have anointed silver for example as the default storage (china did). But instead gold is it. So in his estimate, cryptocurrencies will one day approximate the total market cap of gold because as long as many people accept it then it has inherent value. If we say it has no value then neither really does currency, neither does gold, etc. By that rationale, what actually has real value are stocks, houses, food, oil, etc.

      • white_angelos_enduring_echoes

        fwiw, maybe tell your bud he’s been looking up the wrong material … a currency’s intrinsic value derives from it’s scarcity and utility … that is how it comes to be recognized as valuable, not because someone said so … why salt is not currency – utile not scarce … cryptos solve an important transaction problem … but not scarce – anyone can make one – and no fungible physical form … 2 strikes against

    • white_angelos_enduring_echoes

      i see nothing – i hear nothing … http://tinyurl.com/yaaku6s7

    • I agree. The local wages and household income should not be used to calculate the income to price ratio because these two factors do not drive RE prices. What drives the prices is the equity and already accumulated wealth and there are plenty of folks with one or the other or both living in or coming to live in BC. Maybe local wages can be related to RE prices elsewhere in Canada, but certainly not in Vancouver and there is no point to continue beating the already dead horse. The question about disconnect between the local economy and RE prices has been asked and answered many times already.

    • @white_angelos, right, exactly what I said to him. I don’t believe the physical form is important. But scarcity is a huge issue.

      But by your rationale, we should just financial engineer a new coin called vancouver land coin, where every dollar invested are used to buy land and for sure there is both scarcity and utility. So we can’t start more units of this currency than we have land in vancouver. It’s both scarce and utilized. We can rent out whatever is on top of the land. Hey, that’s an idea.

      • white_angelos_enduring_echoes

        we can make whatever … but a currency needs to satisfy several important ppties in order for ppl to freely adopt it … it’s quite far from arbitrary, as many imagine … if i can’t physically transfer to you smthing fungible as payment, that’s a big strike against imo … it is the most basic and fundamental transaction – no systems nor systems knowledge req’d

  4. Bears are speculating because they want to buy a house in the future on the cheap and they figure they are smarter than the market in having better insights. Analogy to Bitcoins doesn’t apply if a person has no interest in buying Bitcoins. If a person is banking on a fall in Bitcoins then yes, you can say he’s speculating.

    However, this application of speculations is purely due to your characterization of the housing buyers VREAA. You basically said every home buyer is a SPECULATOR! Even though you have no proof that they are actually speculating in the traditional & common usage of the word. Most just want their own place, and yes there is fear of missing out due to price appreciation as they see affordability getting worse with each passing year. So they buy what they can afford and make it a home to live it, with any appreciation as extra bonus when their housing needs changes and they need to move. That is not speculating in the common sense usage of the word.

    In fact, I would say bears with their persistent views are the biggest speculators as they refuse to admit being wrong year after year, and keep insisting a bull market is a bubble that will burst this coming quarter or year because of X, Y, Z policy change or whatever. Bubble don’t go on for ten years. If it did then you can say virtually every stock market bull market is a bubble, and that financial market has been in a bubble for the last 50 or 60 years now.

  5. From the online dictionary, speculation:

    2. a.” Engagement in risky business transactions on the chance of quick or considerable profit.”

    People who have their money in cash or any asset are practicing asset allocation. There has traditionally been a “price” for holding cash, stocks, bonds or other investments in terms of long term rates of return. Risk vs reward vs timeline vs complexity vs costs.

    “All buyers are speculators,” well many are buying for the same reasons that people have always bought real estate: To be free of a landlord, to build net worth on a long term basis, to be able to make more choices about the structure of their home. The economics of all of these reasons have become very interesting in the last two years, but until then those were still valid reasons.

    For many years, you could put your money in government insured cash vehicles and earn a perfectly respectable return. People have learned that holding cash is a losing proposition, even in the short term inflation and taxation more than cover the interest rate. So if not cash or bonds, where to put your money?

    People have turned to real estate because equity markets require a great deal of education and knowledge for success, along with a long time horizon. Real estate is simply the easier psychological choice. Everyone has met dozens of successful real estate purchasers. How many people in your circle of friends have done as well in the financial markets? Amongst median wage/salary earners you’d be lucky to find one in a hundred. So money has flowed into real estate, and those that love things and experiences have run up record levels of debt, encouraged by easy credit and low interest rates. Some say it will all crash, including the rash consumers. Others believe that this is more of the death of the working and middle classes. Buy assets. Invest. Buy a home. Rent and invest the difference, if you can’t get a home. Storms are coming. What form, no one knows. Debt will hurt, and cash is a loser except for moments in history.

  6. “Everyone has met dozens of successful real estate purchasers. How many people in your circle of friends have done as well in the financial markets?” This reflects recency bias. Also, even over the long term, and in North American society generally — i.e. outside the current mania in Vancouver — it is more socially acceptable to talk about the ups and downs of the real estate market, and about one’s allocations to it, than about gains and losses in the financial markets. You might know more people whose financial security is due to investments in the stock market than you realize, but they’re less likely to talk about it than your stranger-neighbor is to mention the condos he owns.

    • Generation-Xillennial

      Great point Canis, I’ve had to move cities every couple of years to build my career (better or higher paying jobs tend not to happen when you stay within a company,) so I’ve held off on buying real estate. But I’ve steadily averaged ~7% in tax efficient growth in rather boring diversified things since the financial crisis which as roughly when I got my first “real” job that left me with money to invest. I’m not sure I talk about it to anyone in my circle of friends and coworkers other than one person who is similarly minded about investing rather than buying a house. Not only that, but there’s been very little drama to speak of. I’ve never won big but I’ve never lost badly yet either. I just have a liquid networth in my early 30s that leaves me with the prospect of actually retiring in my 50s and not really having to worry much about finances so long as I don’t catch the Keep-up-with-the-Joneses bug.

    • Honestly, sorry, this simply isn’t true for the average person. Let’s say vancouver is not normal, even most of my friends who are in the States have far more stashed in their property than their ETFs. This includes their 401 and other registered plans down there. The average person simply doesn’t understand enough about markets to dive in. Whereas a property has real use for them.

  7. Half of Canadians have a TFSA. Of that half, 21% have investments in the financial markets. Canada’s home ownership rate is 71%. For most Canadians, equity in real estate is their largest asset. People who have a high net worth and rent are certainly present in society, but they are outliers.


  8. white_angelos_enduring_echoes

    primary counterpoint to all of the above is real rates have been held negative to prevent a cascade de-leveraging … not a good idea imo … ppl crowd into higher risk assets because $1M in a bank acct gets you pennies … that’s not normal nor long-term stable … consider, at least the possibility of, what happens to your position if the cb put fails

    • On this topic, what this shows people is that cash is a terrible asset to be in. Speaking of cash, as a currency, it has to be limited and have utility. In reality, what the events of the last decade showed people is that central banks are quite happy to print money at will and in reality, only now have normal people realized that their hard earned cash is really a worthless piece of paper. Even if you raise rates, what that is saying is that someone else controls your worthless piece of paper and is making that actually worth something. The reason why bitcoin is rising is also because there is a need for a decentralized currency the interest rate of which is not controlled by any one entity and rather is the market. You might be right it may not be bitcoin but some financial engineer at some point in the near future will likely figure out how to make one that is similar that has like you said both utility and scarcity. At that point, what will cash really be worth?

      • white_angelos_enduring_echoes

        cash has the risk of slow leakage … otoh any crowded assets also bad, perhaps worse … ever see a crowd panic firsthand?

      • Cash and all fiat currency have worth in so much as it is often backed by threat of violence by the state. The state states that you have to accept cash / whatever it deems as currency in economic transactions and paying taxes. Failure to do that mean you are breaking the law and subject to arrest and potential violence by the state. That’s partly how fiat currency is surviving and used.

        Of course, purposely not teaching about basic economics, and money creation is also very useful in making people think that colorful pieces of paper / plastic has actual value.

        Precious metals throughout thousands of years of history has proven themselves to be good currencies and store of wealth. Fiat currency usually lasts about 200 years on average before going bust and new currencies need to be created (though might bear the same name as old).

        Bitcoin and crypto-currencies may sound promising but it really offers no real advantage over fiat in my view, while having properties that’s worse than the worst aspects of gold standards – absolute fixed max supply meaning that it will eventually be deflationary.

      • white_angelos_enduring_echoes

        supply growth of currency a non-issue … ever increasing prices (inflation) req’d for econ growth = big lie … eg. your tv/computer/e-devices better, cheaper yoy 30+ yrs … how’d that work out? #1 grower, #1 transformative … deflationary = progress … get more, do more for same input – commonsense … gold std = constraint on govts/banks – can’t print and kick can very far … they don’t like that … in lieu we have pretend stds, for as long as ppl will believe

      • There is a difference between good deflation like what has happened in the electronics industry, and bad deflation – which is monetary base contraction / stagnation which is what has happened under gold regimes and used as justification for replacing gold with fiat currency (back by government taxing power & gold).

        Take Bitcoin, it has a max of 21M coins. If we assume world population at 7 billion people, that works out to be about 0.003 coin / pp. Now, as the population expands (since we hasn’t hit peak population yet), the average coin / pp is going to drop which means workers have to work for less coins. Unless price deflation happens at a fast pace (doubtful), the working people will be worse off, while the asset owners and gate keepers (eg. payment processors) will get richer. This has happened under gold regime and will be exacerbated under BitCoin’s max coin regime because at least gold, gold mining and gold rushes was able to expand the supply to balance out population & economic growth in lumpy steps.

      • white_angelos_enduring_echoes

        as you said ppl have used gold, as an example, for millenia … the supply constraint presented no impediment to economic expansion … that theory is made up … usa expanded fastest in 1800s when $ was gold/silver receipt … post ww2 expansion was result of wrecked economies everywhere else … ppl in aggregate don’t hoard specie/cash, they use it or lend it if the return justifies … kind of a fun thread … ps. fiat is a misnomer … no currency ever came into being because simon says … $ gained reserve status only due to it being a receipt for au … the backing was removed altogether in 1971 … chart inflation since – not stable – now who is getting robbed?

      • white_angelos_enduring_echoes

        fyi cryptoblahblahblah … http://tinyurl.com/y9dmkoov

  9. Gold & Silver supply do expand through history via mining, it is not a constant. However, when the supply becomes stagnant temporarily or rate of expansion slows, economy that uses metal standards do become affected and suffering from either contraction and/or deflation. It is a simple fact and that’s why the move away from metals to fiat currency.

    Hoarding is actually pretty common when you go past 1900 in history. It only feels weird to you because your entire live has been in an inflationary world where prices going up for majority of goods and services (with electronics being a big exception) year over year, decade over decade. Someone from 1800s looking at our pricing data would be shocked.

    • white_angelos_enduring_echoes

      statements like these are why econ isn’t a science, it’s a cult, a belief system … many examples to contradict … in real science only one is req’d to invalidate a theory … and upon rigorous exam, none to support … the only fact there in what you said is metal stocks do indeed expand … however, v slowly, effectively const wrt econ … and never out of thin air, mining is expensive … best = no stds … freely use whatever … something will evolve to suit the task … btw, this was the situation prior to legal tender … us constitution: govt to pay its debts in au/ag, something it can’t create from nohing, but no restrictions on individuals

      • Uhm…no, I think you are mis-understanding what is science….

        Econ is not a hard science like chemistry, but neither is it complete voodoo. It’s somewhere in between and its usefulness depends on both the researchers and its users.

        with regard to my statements, it’s easy to verify by looking through economic history books. Or simple Google search about metal standards and its shortcomings, and why Germany was pushing towards an elastic money supply.

      • white_angelos_enduring_echoes

        science either is or isn’t – either follow the method or not – that much i know … concede there are scientific aspects of econ, hence a behavioral ‘science’ … read many fed transcripts? … definitely voodoo … explain this, if ok for banks/govt to print, elasticize, counterfeit the supply to aid growth, why not everyone else? … why do they get to be the high priests?

  10. BTW: More info today from parties with ears close to the ground: The Vanc RE market is very definitely slowing.

    • Yep, I concur if you are looking for like a 3 mil place, but try telling that to anyone looking for anything below a mil today, good luck with that.

      Honestly, at this point, if you got in like in the mid or late 2000’s (basically before 2010), you are up by so much that any sort of “slowing” doesn’t really affect you anymore. Your mortgage is probably a fraction of what your place is worth today. Rent prices have skyrocketed which means that basically price to rent is now somewhere that would actually make even a 2010 purchase look decent based on fundamental economics of say 180 price to monthly rent. Basically rent is playing catch up at this point. Vancouver average one bedroom rent is 1900. In 2015, I could buy a large older one bedroom condo in kerrisdale for around 350K. This means that in some areas (kerrisdale is a pretty decent area) rent has caught to 2015 levels based on fundamentals.

      • Hey Brian — apples to apples, right? “Vancouver average one bedroom rent” is influenced by a lot of new condos near downtown with views, granite and stainless. That older one bedroom condo in Kerrisdale doesn’t rent for 1900. Rent has a long way to go to catch up with prices, even 2015 prices..

      • Hey Canis, can you tell me where you got these numbers from? Padmapper now puts one bedroom rent in July to something like 2090 dollars. You do realize that MOST rental buildings in vancouver are older buildings right? If you analyze rental stock, a large percentage of apartment rentals are in fact old dedicated rental buildings. The downtown apartments you cite are basically amateur landlords and not dedicated rental units. So it is definitely not realistic for these to make up most of your rental supply. In fact if that was the case renters are far more screwed than I thought. The reason why we have such a rental crisis is because we stopped building these dedicated rental buildings.

        As for kerrisdale. I am not sure what numbers you think you are looking at but I went to a rental property three weeks ago. This was a 2 bedroom older (I think 35 to 40ish year old) dedicated rental building with no in suite laundry (I have to do coin laundry). The unit itself was not updated, so about 20 year old interior but I would say well maintained. Price tag, 2700 a month, and there were 8 applicants already. I told my relative forget it, you have no shot at it unless I signed it with you. So I am pretty certain you can get 1900 for a similar one bedroom unit in Kerrisdale right now. Btw, my 2015 numbers are correct also for sale price, if you don’t believe me, I can post some data here to prove it. But you can look up bcassessment on one bedroom units in kerrisdale and some of them might still have 2015 sale records on.

        So if both numbers are correct, then yes, absolutely, a 350K valuation versus a 1900 dollar rent value is fundamentally correct. It’s just that we only caught up to 2015 levels and today that same condo is worth about 500K to 550K. The issue I have and I have stated this earlier is that we have zero chance of returning back to 08 levels even because rent doesn’t go down. It only goes up unlike prices, this means that if say the condo crashes back to 250K like some here have suggested it could. It would be a no brainer for me to buy it and rent it at 1900.

      • Btw, one more issue with your analysis, you also realize that there is East Vancouver right? Padmapper’s numbers is for vancouver average, which takes into account both East and West, this means Kerrisdale most likely is one of the top neighbourhoods in this analysis given that west side sub areas are more desirable than just about every sub area on the east side.

      • “So I am pretty certain you can get 1900 for a similar one bedroom unit in Kerrisdale right now.” Well, based on my own reasonably recent looking around in Kerrisdale, I think that’s a stretch. You really can’t stand to be disagreed with, can you? You must be so much fun at parties.

      • “So it is definitely not realistic for these [newer downtown condos] to make up most of your rental supply.” I didn’t say they did make up “most” of it — though if very few rental buildings are being built in Vancouver any more, then condos do make up an increasing percentage of our rental stock, right? I said they influenced averages, which they do.
        Nothing scares a real estate pumper more than the assertion that renting is a reasonable alternative to buying.

      • “because rent doesn’t go down. It only goes up unlike prices. . .” I’m not going to make any predictions about what might happen to rents in Vancouver, but this is by no means a universal truth.

      • @Canis, it shows how little you know of our real estate market that you think I am a real estate pumper. I know many many real estate bulls, the one trait that bulls want is for the market to go down. Because it allows us to buy more. Believe me when I say this, there are many of my friends who are praying for this market to tank. They all know the numbers on detached and know that long term, detached properties in vancouver will only lessen. So yeah.. the last thing vancouver needs is more real estate pumpers.

        Sure, you can disagree on the kerrisdale rent but those were the padmapper numbers. And given that there are like 20 sub areas in the west side and 20 sub areas in the east side, can’t see how kerrisdale is below average given that it is probably better than 30 sub areas of vancouver. Also given my personal experience of helping someone find a rental, this aint’ looking pretty.

        Btw, nowhere did I mention that renting is not a good option today. I only said that rental rates are playing catch up. And I gave numbers as to how many years behind I believe rental rates are. The issue is that given rental prices usually doesn’t go down that means fundamentally the more it goes up the less likely a scenario of crash like what this blog has said would happen.

        The blog has been around for a decade, and it called a massive crash in 2008 which would be 2003 level prices. At those prices, you are looking at at least 10% rental returns given how high the rent has gone up. And no, renters are not in good shape. Especially those with pets, they are basically screwed.

      • brian “I know many many real estate bulls, the one trait that bulls want is for the market to go down. Because it allows us to buy more. Believe me when I say this, there are many of my friends who are praying for this market to tank.”

        That would make your friends the most unusual ‘bulls’ in the history of all humankind, in the history of every kind of markets, ever… Bulls almost universally expect the market to go up and keep going up.. particularly when it’s been doing that for almost all living memory 😉
        a very small number may be hoping to buy dips.. but they only expect small dips, and anything more will give them pause… (how far can this go down?)…
        the vast vast majority of bulls don’t expect any significant pullback at all (look at your friends.. they’re all sure prices in the medium and long term can only go up…. right?… they believe we’re running out of detached houses, right?)

        I think what you may mean is that all those bulls you know often state that the WISH that they’d bought even more at past lower prices… they may THINK they’d buy on pullbacks, but… let’s see…

        If and when this market tanks, just watch… your bullish friends will quickly become skittish… instead of ‘snapping up bargains’ they’ll start panicking about trying to realize dwindling gains… they will do what ALL bulls do in plunging markets, they will bail. Almost all ‘investors’ in currently overvalued markets (which is most of them!) are of the momentum sort.

      • @vreaa, you are talking about the people who bought starting from november of last year till this feburary. If people on this board doesn’t know what the market was like at that time, they shouldn’t comment on vancouver real estate at all.

        Sorry, but given that fact, I think your argument doesn’t hold much water, certainly the part where you are so sure of this. I will tell you what the research shows. In the end, the detached market is tiny. In fact, if I went and rounded up enough money, I could even buy out a lot of the detached market and hoard it. Given that Vancouver proper only has 47000 detached units and that number is decreasing for condo and townhome development I am surprised no one has thought to start a group and just hoard this commodity. This is also why you see hard resistance lines at 2 mil on the west and 1 on the east (though the bottom resistance line on the east is moving up to about 1.2 to 1.3 now). We were studying this during the last fall for the FB tax. We couldn’t breach the 2 mil line no matter how hard we tried, and we tried very hard. Strategy is definitely to buy the dips. Hey, if it doesn’t work out, the market is small enough simply by taking supply off of the table you could force prices higher. Btw, one more thing you should note. I am seeing more and more people combine with others to purchase property. While this is nothing new I think you will see a greater prevalence of this in the coming years especially in the detached market which will probably throw off a whack load of things like price to income.

    • white_angelos_enduring_echoes

      whaaat? … when did this here get to be about houses? … hope you don’t mind my visiting virtual vcr for a friendly chat or 2 … hey – is it time to talk about trump again?

      • That guy is about to kill us all in a nuclear war with North Korea, so I say it’s about time….

      • white_angelos_enduring_echoes

        compare rhetoric to actions – everything he does is very measured … but who is actually testing missiles over japan? … i don’t think it’s really about nk … all of this more a way of negotiating with china … trade has been one way for too long

      • I am sure banning people from specifically muslim countries was a real “measured” move. Also firing Comey was “measured”… Also the part where half of your white house staff is gone.. sure that doesn’t scream imbecile in charge at all..

        I am not sure measured is the word I would use to describe trump. And if it weren’t for the fear of some republicans of losing their jobs, millions of americans would have lost medicare. I am sure that was quite “measured” as well.

      • white_angelos_enduring_echoes

        a lot of muslim countries ban those same places – it’s for a reason – there aren’t a lot of radical christian/hindu/buddhist terrorists … not to paint all of islamdom with a single brush … but acknowledge that the radicals would very much like to take everyone back to the 7th century … and that’s a definite problem … notice what’s going in europe? … have a closer look at sweden for example … comey, let’s see … there’s direct evidence that he drafted hh’s letter of exoneration a priori … firings – well, if it’s not working, why waste time … you’re repeating the corp media almost line by line … if there was any doubt before, the election should have made it very clear – they’re propagandists with an agenda … i’d be especially wary of any ‘idea’ msm pushes, more so the harder they push … obamacare isn’t medicare and it isn’t working anyway … everyone hates it … it effectively is a way for pharma corps and the healthcare industry to milk the public cow … it’ll die one way or another

      • So is trump pushing a single payer system like what we have in Canada? No. Is trump pushing to get more people insured under his new plan? No? Are more people likely to lose their insurance under any plan that the republicans put out? Probably. So what you are saying is Obamacare sucks, so let’s just get rid of it and leave millions without coverage cause everyone except those who would lose coverage hates it.

        Err, not sure who you hang out with, but I happen to have a lot of friends from those six countries, Iran in particular but others as well. I don’t cringe whenever I meet someone new from these countries because I know not everyone is a terrorist. This isn’t the MSM like you suggest, this is who I am friends with and how I judge with my own eyes. I don’t see how you can legitimately say that we will blanket ban visas issued to people from those countries assuming that they are guilty when we clearly have a system that assumes innocence until proven guilty. Just like I don’t assume everyone I meet from these countries are a terrorist.

        Sorry, there is no excuse for this asshole. When you are the president, make no mistake, your words matter. So you can’t say it’s just rhetoric. I don’t see an ounce of leadership from this idiot. He is a businessman. He is wildly successful at business but this doesn’t make him a good president. Presidents need to watch what they say, they are not tabloid magazines, because what they say emboldens elements of our society that we do not want. When he called the white nationalists “fine people”? Sorry, what is fine about doing nazi salutes?

      • white_angelos_enduring_echoes

        d’souza can do way better than me … http://tinyurl.com/pyske59

      • white_angelos_enduring_echoes

        ps. trump weekend twitteric … just a few clicks to get bunch of spoilt brat millionaires to protest his dictatorial-ness … get this … by bending the knee (ack!) … c’mon you have to appreciate the aesthetics … waiting to see if msm will bite on free speech angle … since they actively censor everything

      • I don’t completely disagree with him, I am actually fundamentally conservative.. however, still waiting for how he wants to respond to the scenario where “one guy is almost dying of hunger and the other dude is an ass and won’t give him one of his seven sandwiches”. At that point, shouldn’t there be obama with a gun forcing the other guy to give it to him? Or do we now not give a shit for people to die. It’s easy to be conservative, he says everything I used to think until someone asks me a fundamental question: “are you willing to see people suffer and die”. My answer is simple, no, doesn’t matter how undeserving that person may be there needs to be a guy with a gun who forces me to give him the basic neccesities of life.

        I will take this one step further. I personally believe that the disagreements between conservatives and liberals is the idea of equality of opportunity vs outcome. If the US is founded on the basis that everyone is equal, then government needs to ensure equality of opportunity. I can’t see how you do that without free healthcare.

      • white_angelos_enduring_echoes

        at the core, it is a question of freedom vs coercion … if you take the 2nd because you believe you are right (i.e. you are now god), it’s a slippery slope … that is the side which led to communism and fascism

      • Right that is correct. But the issue is that do we want to stick to these principles or do we want to be pragmatic. Believe me, I would love a system whereby I as the procurer or resources get to decide rather than being coerced to distribute based on my own interpretation of compassion. But I also don’t want to be stabbed or robbed walking down the street because someone is about to die from hunger and he sees me as his only source of procurement of resources. Besides, a functional democracy requires a knowledgeable voter base. Don’t see how we achieve than just based on charity of free markets.

        Btw, the way D’Souza talks about wagon pullers and sitting in the wagon ignores the fact that free markets and technological advances greatly favors inequalities. Picketty in Capital in the 21st century explores this capital labour discussion quite well. Also.. as a person working in technology I can tell you that the automation of labour tips the scales on the capital side to an extent that it is starting to destroy the need for labour (well duh, that’s kind of obvious). Technology belongs almost entirely to the capital side. And that is a large source of growth these days. So of course you are going to have a lot more people sitting in the wagon because there is no need for them anymore. They have nothing to do.

      • white_angelos_enduring_echoes

        not equality, equality of opportunity … on pragmatics … main pb with govts making decisions, even if i were to concede on coercion (which i don’t), is competence … what is the mechanism for liquidating bad decisions? … with the market, it’s simple … you go out of business, end of story … resources redeployed elsewhere … no such effective mechanism in socialism … it grows, consuming everything until is falls apart completely … and admit it, most plans even by v smart people don’t work out as originally imagined … real progress involves a lot of trial and error … other big pb, if you distance the decision makers from the direct consequences of their mistakes

      • Fundamentally I agree. In fact you sound like a naive version of me ten years ago. The issue is that just because it makes sense theoretically doesn’t mean that will work. Hell even Hong Kong, which is far more libertarian than the US has a public funded medicle system for a simple reason. It’s unreasonable to sit there and watch people die doesn’t matter what your beliefs are.

      • white_angelos_enduring_echoes

        back to core principle? … you decide presuming (i) ppl die as direct result, (ii) what you do will prevent that and (iii) this will not cause a worse outcome elsewhere … i.e. you’re god with straw man … alternative is simple reciprocity … i have no right to force you, nor you me

      • That would end up being really well for the disadvantaged or disabled members of our society. Cause we all know humans aren’t greedy at all.

      • white_angelos_enduring_echoes

        you don’t know that and you’re not infallible … this to consider before violating another … core new testament: you’re not god, don’t judge

      • Is there a god? I don’t think it is accepted that there is one. A lot of people are atheist so we shouldn’t assume.

        Actually, people can judge as they want. It is a democracy, just like you say, let’s all not pay taxes and let everyone fend for themselves. Clearly there is an element of society that wants that or else Trump wouldn’t be in power. That being said, clearly there are a lot of others who are more socialist than that. We can judge if we wish, it’s up to us. Democratically elected governments that said ok, tax the rich so we have a safety net. Now, as a democratically elected society where the giver or the taker both have the same say.

        Take myself for example, I pay far more in taxes than I do get in benefits. So I am one of the proverbial wagon pullers according to D’Souza. However, I also have a choice. I could leave here and go somewhere else. I could vote for governments that take less. I don’t think anyone is forcing me to think or vote the way I am. Same choice is for everyone else. I don’t see Bill Gates or Warren Buffett leaving the US so clearly the system still favors the rich far more. Or else they would have left already.

      • white_angelos_enduring_echoes

        god = metaphor … however you want to interpret that … in this case, respect one’s own fallibility … why socialism is dangerous imo … i’m allergic … ppl convince themselves they know better (quite easily done) … use as pretext to violate others for common good, collective good … never ends well even when it starts well

      • Sure I get your criticism of socialism, that being said, we all know what happens if we don’t have government. It’s called survival of the fittest. You see that in nature all the time, what happens to the weak is that they umm… die.. Or they are reliant on compassion of their peers which a free market is not able to gurantee. What socialism does is provide a basic standard of living for its weakest members. It may not be the best for advancement of species given that we allow the weak to linger but I do believe that it is neccessary as no one should simply be eliminated the way nature does.

      • white_angelos_enduring_echoes

        conclusions are entirely unsupported … don’t you straw man me sir … ppl actiing freely can/will organize to solve pbs absent the coercion … in the meanwhile, some of us may return to our beloved bc if … say, you get rid of icbc … they should all be fired and replaced … that would be a nice sign of progress … until then http://tinyurl.com/y9c6zj2d

      • Brian is making a lot of sense about buying and hoarding this resource – cornering the market, but no way would I call it a commodity. Greedy Jim is big on this, as are many little players. I know one old Japanese builder that owns 17 houses, and he’s a pimple in the scheme of things. Look at the gnomish trailer trash billionaire Sam Zell. He owns 14,000 units. Does he influence the market? Massively. There is a known finite number of detatched properties that are ever decreasing. Add to that the crap locations of many of them. If you buy smart, not randomly, you will score.

      • Absolutely. Sorry, I don’t mean buy every detached listing on the market. Buy selectively on decent locations as those are even rarer. However, i would suspect my criteria isn’t as stringent as Arnie’s as he has a much deeper understanding of detached properties than I do.

  11. 2761 McGill: an obnoxious new turd of a house in a brutal location. The beige and white will soon turn grey from the 24/day traffic while you lose your mind in this hellhole. The interesting thing about this nightmare is that the lot was flipped last year – almost a quarter mil bump in three months. The speculator was smart, did sfa, and made a quick pile. The builder bought this crud lot for $1.314M, worked like a stupid dog for over a year and will make marginal profit.

  12. Everything crashes eventually. Commodities. Basic materials. Stock markets. Just don’t get caught holding the bag.

  13. 2603 46th Ave E: You’d be hard-pressed to find a more repellent heartless pretentious piece of garbage than this. The godawful location at the stop sign kitty corner to Waverly School is icing on the excrement. And the rodent’s photo – like a cold-blooded killer; a dominatrix. Speculate on this rubbish and feel the pain.

  14. @Brian & @WhiteAngelo – sometimes I think we as a society need to ask what is the point of technology advance? Is it so it will make a few people extremely rich? Or is it to benefits the community / society in general?

    If technology can satisfy the basic needs of 90% of the population and eliminate the need for them to work then what’s the proper solution? A pure capitalist view would be to let those 90% “surplus” people die as they are unneeded excess. A pure communist view would say the wealth belongs to entire society and everyone should share in the fruits of technology advance. I personally would prefer the communist view because I’m not confident I’m in the lucky 10%.

    btw, my view is purely tainted by Chinese history where the 5 Sage Emperors are Sage Emperors because they basically work for the people, gave away all their advances & discovery, for the betterment of people. If they were capitalist then they would have kept the wealth for themselves, charge royalties, etc. But they had different views and believe what they have should be given to all people so everyone is better off.

    • For sure, I don’t belong to the 10%, but I would rather belong to that 90% in the capitalist view; at least, there is always welfare, social assistance and healthcare.

      The pure communist view is not worth the paper it’s written on. Vietnam is a good example; poor people die starving, and the ones hold power are all crooked living more luxury than Queen E 2nd.

    • white_angelos_enduring_echoes

      omg how did we get to this … there is no capitalist view in the way you put it … on 1st principles, the law and govt, as its agency, serve to defend person, liberty and property … only … there are no other rules … the rest, what you call capitalism, is simply what happens when ppl interact freely under this condition … freedom paramount above all … this may never have existed, nor ever will … but you will have to concede that in the long run societies are more dynamic, innovative and egalitarian to the extent they are freer … why western society became dominant … on automation/tech, i don’t think we have much to be concerned about the flint and stone tool workers unions … where tech is more efficient and replaces ppl, ppl can imagine new ways to use tech or their time

      • I disagree. If automation makes 90% of the workers totally redundant then under our current system, those workers have very few or no alternative ways to earn income. The only way those people can live is with state intervention in terms of welfare. How does the state do this? By indirectly forcing capitalists to pony up money / wealth to feed these now permanent out of work people.

        If as you say there should be free choices then these people would be depending on charity only, not government welfare because government is taking by force, not voluntary.

      • white_angelos_enduring_echoes

        yes,those who cannot adapt are reliant on others … need does not entitle them to the ppty of others … in the extreme, harsh yes … however, redistributing wealth via the state creates worse problems – imo

      • I am really curious as to what do you see as worse issues than people dying? If you don’t redistribute wealth via state, how do you gurantee that people don’t simply die because of a lack of resources? Show me a system where you can gurantee that and not have state distribution.

      • white_angelos_enduring_echoes

        there is no guarantee … that’s life … we’re speaking of a hypothetical extreme here … you don’t know if it will transpire as you imagine … otoh, the alternate path has led to the worst abuses of power in the last century – a lot more ppl dying and not hypothetically

      • I would like to know what people died as a result of socialist policies. Or are you simply saying as per D’Souza that socialist policies enable people to manipulate the system to get elected and these people have alterior agendas other than the greater good of people which causes death? Because if that is the case, your issue isn’t so much with socialism as it is with populism.

      • white_angelos_enduring_echoes

        well it is said persistence is a virtue … 20th century socialism gone wild: lenin, hitler, stalin, mao … just the top hitters tho … core principle freedom vs coercion … once you cross that line, where to stop? … so with national socialist no.1 having been evoked, let’s declare officially we’ve gone off the reservation and into the weird place … and while we’re here why not also from the parable of darth vader? … once you start down the dark path, forever will it dominate you destiny, consume you it will … lolz … remember how this thread started – can i just bookend it here? … http://tinyurl.com/yae9j8nc

      • white_angelos_enduring_echoes

        v – comment in moderation

      • waee.. thanks for headsup.. not sure why held back.. perhaps cos you mentioned hitler….

  15. As for rental rates, if the new condos are all charges say $2000/month which is out of your range, and you need to find a place, guess what? If a 40yr old apartment with no in-suite laundry charges $1800/month which is you can afford, and you have no better choice, you have to take it! Even if you think the rent is way over what it should be given the qualify of the product. That’s how and why older buildings can get away with high rents. People don’t have a lot of choices and if they can’t afford the “reasonable” rent of new places then they have to take the overpriced old places, unless they are willing to take even worse places (say moldy basement) at lower, but even more inflated prices.

  16. Learn about the Zeitgeist Movement; listen to the late Jacque Fresco; read Pierre Burton’s ‘Smug Minority’. We must move to a resource based leisure economy and stop valuing idiot soul-destroying, life-wasting wage slave jobs. This perverted economy values someone who builds landmines over a homeless poet. A car crash is a calculated as a benefit to the GDP.

  17. More from the grapevine:
    Lot prices on the westside are dropping. And very few sales.
    September stats should be interesting.

    • You seem to have overlooked the first comment on this post: “we will still double at least from here.” Just close your eyes and repeat those words . . .

    • @vreaa, just saw your postscript. After such a hot run, especially in Langley where detached newer builds on tiny lots but 3500 sq ft homes have gone from 500K to 1 million, you would expect there to be some cooling especially when the buying there is almost entirely supported by non-immigrant locals. Space made a great point earlier that bull market runs usually last about 7 to 8 years, and we are now in what year 15? So is this still a bubble or a massive bull run?

      • To answer your question:
        It’s a bubble.

      • You mean a run of almost 15 years is a bubble? By that rationale the stock market has been in a bubble since inception.

      • You’re putting words in my mouth.
        The 15 years don’t make it a bubble.
        The fact that it’s a bubble makes it a bubble.

      • No, you never mentioned the 15 years part, I mentioned that for you. But how long does it take until you admit that it is not a bubble? I mean the problem is how do we tell when something is a bull market versus a bubble? Is the S&P 500 in a bubble then? Has it been in one for 50 years? If it is in one in 50 years then is that still a bubble?

      • Those are the questions that bubbleonians ask themselves during bubbles.

        I know you mean them rhetorically, but for fun, here are the answers:
        As long as it takes for fundamentals to catch up with prices.
        Yes, it is.
        No, 22 years.
        No, exact timing has no say in this, it’s all about fundamentals.

    • Actually those are the questions people who have been priced out for decades ask themselves. Fundamentals are subjective, like I pointed to before, Hong Kong is 19:1, Edmonton is 5:1 price to income, which one is more fundamentally correct? It all depends on the people living there and their preferences on owning versus say renting.

  18. white_angelos_enduring_echoes

    hey! … the criminal is coming to see all you all … why not go ask what’s she doing with your $20M … http://tinyurl.com/y8cnyhqo

  19. white_angelos_enduring_echoes

    @brian … http://tinyurl.com/ya3lfflq … wake up … this kind of stuff never used to happen

    • What never used to happen? The dude who shot dead 3 police officers in New Brunswick? Yeah… that never used to happen either. So should we be afraid of White kids walking in dark pants wearing hoodies too? Come on, you are telling me that we should quiver in fear? What is your solution? Let’s never let in anyone from a Muslim country? Or ban people from Trump’s list? Cause surely all Iranians are bad right?

      Wait, I know what you will say, MSM taught me this. Actually no, I happen to have a lot of friends from Muslim countries because I play in a soccer league with a lot of them. So yeah… I can see with my eyes that they are not terrorist.

      • If only those 3 police officers had guns to protect themselves and take the shooter then the tragedy would have never happened!

        oh wait! Those police officers were armed….something doesn’t quite jive with the NRA philosophy…

    • white_angelos_enduring_echoes

      let’s not confuse cultural with ethnic … i presume your friends integrate and this is why they’re your friends … i have such friends too … but there clearly are strains of islam that don’t, won’t and they tell you that up front … their culture is intensely tribal, backward and incompatible with the west … tolerance can go only so far … scholarship a bit loose but she is on the mark … http://tinyurl.com/ya9kcum8

    • Ok I can buy that. In fact, I will take this one step further, I feel the chinese culture is far more enclosed than the western culture. But what do you suggest then? I don’t think Muslims or Christians or Chinese or whoever want terrorists in. But simply banning an entire country isn’t exactly the answer either.

      • Well, banning countries might not work 100% but it’s a quick, easy, cheap, and dare I say fairly effective way of doing things.

        Take for example 9/11 where all but 1 terrorists was a Saudi national. We already know at that time Saudi funds and creates a lot of terrorist. Banning every Saudi citizen would have probably prevented 9/11. Yes, it’s terribly unfair to 99.9% of the population but you can’t say it’s ineffective or cost effective.

        Off course, that doesn’t mean we shouldn’t spend the effort to figure out the root causes and address those, but those are long term solutions. You want something to happen in 3 months, you don’t have a lot of choices. As well, given US foreign policies, it’s unlikely they will find a more effective policy than this. Sad but true I think.

      • white_angelos_enduring_echoes

        i’m not the answer man but trump hasn’t been illogical … 1st is to acknowledge there is a pb … progressives refuse to to do that – they believe their own multiculturalism nonsense … 2nd is take logical precautions – extreme vetting from known places … he’s more of a straightshooter than anyone we’ve had in a long time, even if offensive … much prefer that … the bombast is a rhetorical device – what’s the 1st sentence in art of war? … on the race/ethnicity/culture, trudeau for example packages everything nice and feel-good tidy … but recall what hrc leaked commentary about public vs private faces … my favorite to illustrate what the dem braintrust really think … http://tinyurl.com/h24agkm

      • The issue with trump isn’t that he isn’t a straight shooter but he minimizes problems. He thinks that by being bombastic and simplistic shit will be fixed. I don’t think there is a liberal in sight that says, let’s let in terrorists. Most liberals agree that we should try to stop illegal immigration. The issue with Trump isn’t that he doesn’t come up with problems, is that his solutions are comical at best. Banning Iranians???? By his rationale, since all these crimes are committed with guns, let’s ban all guns. Why pick and choose where you apply such ideologies?

        Btw, you do realize where a closed door policy leads you right? Chinese of all people can tell you how we went from one of the greatest civilizations to being carved up by imperialists by closing our doors and refusing to engage the world.

      • white_angelos_enduring_echoes

        you <- the_gross_extrapolator … pb <- door_wide_open … here, another nice log for the fire … what should one make of this? … http://tinyurl.com/hnq7gwu

      • white_angelos_enduring_echoes

        v … i been immoderate – again

      • Coming from someone who scored almost 800 on the SAT, the stat that you post is not as meaningful as you think it is. Asians are good at acing standardized test, but what does that really prove? That they will be great middle managers?

      • white_angelos_enduring_echoes

        sure you can prep a sat and test may be flawed, but not by that much … math tests are pretty basic … it’s either ethnic or cultural … if you say ethnic, you’re racist … if you say cultural, then it makes no sense to enforce ethnic diversity … which in fact is racism of another kind … perhaps more insidious since it masquerades as the opposite

      • So your point being what? because we have racial differences in math, we should just keep everyone separate? Does your math score indicate the need to mix races so that whereas an asian kid is better at math, maybe a white kid is better at interacting with others.

      • white_angelos_enduring_echoes

        the point is that a fairly objective test shows significant deltas in basic abilities between ethnic populations … therefore, if you were to enforce workplace ethnic diversity, for example, you are not hiring on ability … instead you are enforcing a false standard based on race/ethnicity, presumed a priori … anti-racism as pretext for state racism … the argument also applies to gender

      • Ah so you are saying affirmative action is BS. Ok, that I do agree with.

    • One more question, hundreds of people just got shot in Las Vegas. I honestly have no idea what Trump thinks the US has a bigger problem with? Muslim terrorists or domestic shooters. Surely the data says deal with your own mess first.

      • white_angelos_enduring_echoes

        let’s wait on the evidence and of course there will be a lot of spin on both sides … but … isis has claimed responsibility and they don’t do that unless they are in some way involved … they didn’t say anything about edmonton … culture, not race or ethnicity

      • Or more likely ISIS is simply trying to go for cheap credit and publicity to boost its public image. I think ISIS used to have a policy of basically claiming credit for all tragedies like this, no matter how strenuous the claim might be.

        As for Muslim terrorists vs domestic shooters, it’s obviously Muslim terrorists that’s more horrible – 9/11! Did anyone forget that? 3000+ people dead! Twin Towers destroyed! Let’s see any domestic shooter top that! Assuming they can get pass all the responsible citizens who carry firearms just for this type of incident – NRA logic.

        btw, reading the comments, especially on ZeroHedge, it seems like a good chunk of people believe this might be a false flag, or black ops, or plain hoax by the government for whatever nefarious purpose they have.

      • white_angelos_enduring_echoes

        if there are weapons, determined parties will be able to obtain them … laws can’t solve that – eg. paris 2015

      • @white_angelo – so you support the gun right’s argument that the problem isn’t guns, or society, but rather there aren’t enough good people armed with appropriate guns to deter the criminals? That more guns will resolve the problem?

      • @white_angelos. Then how do you explain that America has a far higher rate of gun violence than places like Canada? On a per capita basis. I think there was a study comparing US gun deaths against other developed countries and America stands out like a sore thumb.

      • white_angelos_enduring_echoes

        my example is one to illustrate that even where gun rights are very strict, it will not prevent … us rates are higher among 1st world but when you adjust per pop, it does not stick out, and it is not at all obvious there is a causal reln to gun access …. if guns were harder to get, a motivated party will find some other weapon … again, you presume both the pb and soln … this is v typical socialist, which ultimately leads to fascist … if ppl do anything, it is b/c they want something … behind everyone of these events there is a clear pathology … study that instead of jumping to conclusions

      • Dude, the data is per Capita. So it is not actually absolute number. It takes into account that US has more people.

      • white_angelos_enduring_echoes

        choice of weapon is not root cause … bombs are very illegal … and lately, vehicles are weapons … btw >50% gun fatalities are suicides

  20. @VREAA – fundamentals…that’s so lovely..so what are the appropriate fundamental values?

    take stock for example, Amazon has a PE in the triple, if not quadruple digits. Is Amazon stock in a bubble that’s going to burst and crash 75%+? It’s been going up since 2002 or went vertical in the last few years.

    For how about RBC? Let’s say it makes $5/share per year. What’s an appropriate price? $20, $50, $90, $120?? Who decides that?

    • A stock is a share in the earnings of a company. A company is worth the net present value of expected future earnings, discounted at the 10 year government bond rate. Or at least that’s the formula used by investing genius Warren Buffet.

      Of course calculating future earnings, as your example so aptly points out is the devil in the details. Will Amazon continue to increase earnings at the rate expected by its lofty stock price? Or will it increase even faster than expected, leading to even higher expectations. RBC is easier to calculate, if you can factor in the impact of the bursting of the housing bubble. As part of an oligopoly, it does pretty nicely over time.

      Who decides that? The market, in the short run sometimes wildly irrational, in the long run priced on real returns to investors.

    • white_angelos_enduring_echoes

      where the fundamentals went … http://tinyurl.com/zkat2z6 … how long can it go without losing control?

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