“I sympathise completely with savers and those who behaved prudently who now find themselves among the biggest losers from this crisis.”

Mervyn King, Britain’s chief central banker, last week made some plain statements not yet heard from central bankers this side of the Atlantic [from sovereignman.com 1 Feb 2011] –
“In 2011, real wages are likely to be no higher than they were in 2005… One has to go back to the 1920s to find a time when real wages fell over a period of six years.”
“The squeeze on living standards is the inevitable price to pay for the financial crisis and subsequent rebalancing of the world and UK economies.”
“I sympathise completely with savers and those who behaved prudently now find themselves among the biggest losers from this crisis.”

Olympic Village Fiasco – News Video Archive

Greenhorn (aka SethM), a regular poster at RE Talks, has done a marvelous job of collecting an archive of video news clips regarding the Olympic Village, at youtube. As the story unfolds, we see it interpreted step-by-step by the local news channels. The village will quite likely prove to be representative of the entire Vancouver market. Common themes of arrogance and overconfidence running into the brick wall of reality. Some memorable moments:

“The athletes will move in; they’ll move out; and the consumer will move into their condos, so that there is no cost to the city or the province.” – Bob Rennie, Marketer, September 2008

“There is more than sufficient security to back those loans up.” – Shahram Malek, Millenium Properties, 7 Nov 2008

“I am confident that this is a very good deal for the taxpayers… there will be no risk to the taxpayers.” – Peter Ladner, ex Mayoral Candidate for NPA, 10 Nov 2008

“Welcome to your new digs, John.” – Gregor Robertson, Mayor, at key-to-the-village handover to John Furlong, VANOC, Nov 2009

“I feel good about it. I think that everybody will make money.” – Bob Rennie, Marketer, 16 May 2010

“My clients thought they were buying a very high end unit and they don’t believe Millenium is delivering anything near what they promised. … Once a purchaser loses faith in a building, they just don’t want to be there.” – Bryan Baynham, Lawyer, 26 Jun 2010

“It’s absolutely normal. We have no concerns.” – Penny Ballem, Vancouver City Manager, 26 Jun 2010, regarding people trying to get out of presale contracts.

“A sterile environment, it feels like a science-fiction film.” – Visitor, 2 Sep 2010

“Promises were made around having a social legacy to the Olympics… Now that the circus has left town, a different story is emerging.” – Am Johal, Community Coalition, 2 Sep 2010

“If I have to include the HST portion that’s been added to.. on top of GST, or we’re looking at a couple of months, uh… we’re looking at a couple of years maintenance fees, we’re going to announce those incentives sort of mid-September that what will stimulate people to buy.” – Bob Rennie, Marketer, 2 Sep 2010

“It’s like a ghost town. … They were telling me.. look at the benefit you’re going to get, you are going to make so much money.” – Mario Loscerbo, Mario’s Gelati,  a nearby business that endured years of construction inconvenience, 30 Sep 2010

“It’s awfully quiet.” – CTV News, 30 Sep 2010

Say Goodbye To Debt Fueled Housing Bubble

The BoC meets tomorrow and will almost certainly increase interest rates. Even with all of this recent juice, Vancouver prices have flattened and likely already begun their descent. Some kind of extreme has been hit, and the rate hikes will add to downward pressures. Our estimation is that, over the next two years, prices will likely correct by >33%. Thereafter we will grind lower, and the eventual trough will represent >50% off current prices. -vreaa

This excerpted from ‘Mortgage debt surges as economy picks up steam’, G&M 31 May 2010 –

“Canada’s economy is on fire, surging 6.1 per cent in the first quarter at an annualized pace.”

“A Statistics Canada report also shows personal debts rising, as mortgage growth surged $76.4-billion annualized in the first quarter from $59.8-billion per cent in the fourth quarter of last year. People are using more credit for homes, but less for other items.”

“Household debt as a percentage of personal income probably rose to a record 148 per cent.”

“I have a number of variable rate mortgages right now at 1.35%”

Any cheaper and it really is free money. -vreaa

This from a property investor named thadeus at RE Talks 18 Jan 2010 –

“For the record, I have a number of variable rate mortgages right now at 1.35% … I also have properties with a fixed rate of 5.49% and they still cashflow each month.”

David Wolf, Bank of Canada – Different Master, Different Message

We’re worse off but we’re better off. These guys are magicians. -vreaa

[David Wolf, an advisor to Mark Carney, Governor of the Bank of Canada (photo: National Post)]

This priceless juxtaposition of quotes posted by crabman at vancouvercondo.info 11 Jan 2010 1:17 pm

“Now that David Wolf is at the Bank of Canada, he says everything is great?:

“Recent house price increases do not appear to be out of line with the underlying supply-demand fundamentals,” David Wolf, an advisor to the governor, Mark Carney, said in a speech in Edmonton. [11 Jan 2010]

That’s not how he felt in 2008 when he was at Merrill Lynch!:

It may just be a matter of time before the Canadian housing market tanks like the U.S. market did, Merrill Lynch Canada economist David Wolf said, warning that Canadian households are now nearly as overextended as households in the U.S., and even more so than those in Britain, prior to the bursting of the housing market bubbles in those countries. [24 Sept 2008]“

“I am in government relations. I vow that should the government contemplate any type of homeowner bailout, I will be organizing a ‘grass roots’ campaign to lobby against it.”

Sign me up. -vreaa

This from GR, the possible future leader of a grass roots movement, at vancouvercondo.info 11 Dec 2009 12:05 pm –

“I am in government relations, with experience at the federal, provincial, and local government levels. I have vowed for the past two years that should the federal government contemplate any type of homeowner bailout, I will be organizing a “grass roots” campaign to lobby against said type of bailout.”