Canadian Economy Slowing
02-01-2014, 12:27 PM
#16
Drifting
I live in Beijing now (the GT3 is safely tucked away under the watchful eye of EU autowerks). The money here is staggering. Even I'm starting to think a $1.5mm property in Vancouver looks cheap. Some comparisons of Beijing vs. Toronto:
Decent condo in downtown Toronto 80sqm:
Selling price: $450k
Rental: $2k/month
Yield on principle: 5.3%
Quality of the property materials, durability, etc: 7/10
Mediocre condo within the 4th ring road in Beijing:
Selling price: $950k
Rental: $1.8k/month
Yield on principle: 2.3%
Quality of the property materials, durability, etc: 4/10
These are real numbers. The Toronto example is my condo and the Beijing place is the one I rent. Prices increased 10% again in the big cities. To people in China, the Canadian market looks undervalued... It'll be interesting to see what happens to wealth here with the US fed pullback. There are strict capital controls here but I have to believe people are circumventing it somehow.
Decent condo in downtown Toronto 80sqm:
Selling price: $450k
Rental: $2k/month
Yield on principle: 5.3%
Quality of the property materials, durability, etc: 7/10
Mediocre condo within the 4th ring road in Beijing:
Selling price: $950k
Rental: $1.8k/month
Yield on principle: 2.3%
Quality of the property materials, durability, etc: 4/10
These are real numbers. The Toronto example is my condo and the Beijing place is the one I rent. Prices increased 10% again in the big cities. To people in China, the Canadian market looks undervalued... It'll be interesting to see what happens to wealth here with the US fed pullback. There are strict capital controls here but I have to believe people are circumventing it somehow.
02-01-2014, 12:28 PM
#17
Rennlist Member
Well said Overdraft! The media seems to have given up forecasting doom and gloom for the housing market and has switched to beating down the dollar and the economy. This negativity is self fulfilling for sure. It only takes a little fear to delay a hire, not buy that piece of equipment, not move into that larger facility.
02-01-2014, 02:25 PM
#18
Burning Brakes
For now they are certainly circumventing it and only because the government are willing to turn a blind eye. If or when the government decides to clamp down and execute a few offenders the money will stop flowing out.
02-01-2014, 06:05 PM
#19
Nordschleife Master
+1. overdraft for president.
Beware of the self fulfilling prophesy. I - and many of my friends - are employers and entrepreneurs that are meeting the challenges to this economy and working within it. Nobody from CBC or CTV ever rang us to talk about how many people we hired in the past 24 months or what our prospects for the future are going. I was at a Chamber of Commerce function on Thursday where EVERYONE of those folks in that room are cautiously optimistic to what is before them and working towards it- whatever 'it' happens to be. Some will be disappointed, some will have great success but they are all out there swinging at pitches. We (my shop)continue as an organisation to look for qualified people and try to predict where the market is at, and plan to take it head on...but we are answering the phone calls everyday, seeking all opportunities, follow up on inquiries, deliver solid customer service and react if there is an issue...and we are at 100% loading - with 12 months of work ahead of us.
History has hundreds of examples of economies and societies morphing and changing - local - national - international as technology, immigration and yes, PEOPLE, take their inevitable toll on where society heads. Can't speak to Sears and what I at least perceive as a dated brand, Best Buy to the tech nature of their target market who would just as soon buy online...but will suggest that the jobs shed by Sears and Best Buy find a home in Norstram, or Target or within Hudson's Bay as they do a nice job at re-branding...or even the countless independents who can't find capable people if that is the career path these folks take....but closer to my heart, speak to any of your small electrical, mechanical or masonry contractors who continually look for the lack of qualified electricians, plumbers and masons. Many of us seem to want are kids to go to university for an arts degree where we have a serious shortage of young people entering the trades for what is inevitably an $ 80K/+ year job. This is frightening.
All as this tells me is we have to have our wits about us. Someone far wiser than me said, "I've Heard There's Going To Be a Recession I've Decided Not To Participate".
Sorry - not subscribing to the 'this is going to s**t' part of the program.
History has hundreds of examples of economies and societies morphing and changing - local - national - international as technology, immigration and yes, PEOPLE, take their inevitable toll on where society heads. Can't speak to Sears and what I at least perceive as a dated brand, Best Buy to the tech nature of their target market who would just as soon buy online...but will suggest that the jobs shed by Sears and Best Buy find a home in Norstram, or Target or within Hudson's Bay as they do a nice job at re-branding...or even the countless independents who can't find capable people if that is the career path these folks take....but closer to my heart, speak to any of your small electrical, mechanical or masonry contractors who continually look for the lack of qualified electricians, plumbers and masons. Many of us seem to want are kids to go to university for an arts degree where we have a serious shortage of young people entering the trades for what is inevitably an $ 80K/+ year job. This is frightening.
All as this tells me is we have to have our wits about us. Someone far wiser than me said, "I've Heard There's Going To Be a Recession I've Decided Not To Participate".
Sorry - not subscribing to the 'this is going to s**t' part of the program.
02-01-2014, 06:16 PM
#20
Nordschleife Master
if its not 2008, its 2000, 1987, 1929 etc etc etc ... the economy is cyclic and history (and people) repeat themselves... but there are always massive opportunities during the up and down swing.
and i agree completely with those who stated sears is a dated brand and while people may lose jobs today, there will be other job opportunities tomorrow for those same people as people still 'consume', just perhaps on a different platform.
and i agree completely with those who stated sears is a dated brand and while people may lose jobs today, there will be other job opportunities tomorrow for those same people as people still 'consume', just perhaps on a different platform.
02-01-2014, 06:23 PM
#21
Three Wheelin'
02-01-2014, 06:51 PM
#22
Still plays with cars.
Lifetime Rennlist
Member
Sears and other traditional department stores are being killed by Walmart and Target.
The Canadian Dollar at par with the US dollar has hurt exports particularly in manufactured goods. The latest release by the Min. of Finance is that inflation was too low - less than 1 percent causing concerns. The C$ tracks the price of oil - lower oil prices and our dollar drops. I worry when I see GM et all considering closing Canadian plants because manufacturing in the US is cheaper! A lower dollar is not such a bad thing all in all. I also worry about the legacy cost of rich pensions - the US has the same problem only worse. All in all I think the Canadian economy is in better shape than the USA.
The Canadian Dollar at par with the US dollar has hurt exports particularly in manufactured goods. The latest release by the Min. of Finance is that inflation was too low - less than 1 percent causing concerns. The C$ tracks the price of oil - lower oil prices and our dollar drops. I worry when I see GM et all considering closing Canadian plants because manufacturing in the US is cheaper! A lower dollar is not such a bad thing all in all. I also worry about the legacy cost of rich pensions - the US has the same problem only worse. All in all I think the Canadian economy is in better shape than the USA.
02-01-2014, 10:57 PM
#23
Drifting
Wait until taobao.com expands to North America. Bricks and mortar can't stand a chance. The retail landscape in China is where I think North America will be in ten years. Brands open stores as showrooms; you browse the merchandise in the store but then you purchase it online though taobao.com (usually fake stuff) or tmall.com (real stuff). The multi shops are all dying here. Sears was about two generations behind on everything; they deserved to die. Something better will replace them.
02-01-2014, 11:58 PM
#24
Rennlist Member
IMO the economy of central Ontario has been on the skids for three years and it's only momentum in the consumer economy thats kept things tolerable. Our economy is almost 80% reliant on exports to the USA and a dollar at par just doesn't work for exporters. At 85 cents the dollar will bring plenty of jobs and to Ontario manufacturing especially.
02-02-2014, 03:01 AM
#25
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The CDN dollar has dropped for no good reason. As usual.
The u.s are not out of the woods yet.
Right now we are starting to see some sort of increase in the economy but alas it is too soon and too fragile to know for sure.
Canada, especially oil rich provinces are doing better then ever.
Vancouver real estate is bat **** crazy as always.
Soon there will be a lot of new condos thus more inventory which should cool down that segment of their market.
Canada is looking good.
The u.s are not out of the woods yet.
Right now we are starting to see some sort of increase in the economy but alas it is too soon and too fragile to know for sure.
Canada, especially oil rich provinces are doing better then ever.
Vancouver real estate is bat **** crazy as always.
Soon there will be a lot of new condos thus more inventory which should cool down that segment of their market.
Canada is looking good.
02-02-2014, 11:51 AM
#26
Race Car
Maybe it's time to get our heads out of the sand and look beyond manufacturing.
China is in the throws of their industrial revolution and that machine is going to be hard to stop.
Until North America gets it's ducks in order, countries like China, India, Mexico etc will get all the low paying jobs.
Things like raising minimum wage don't help either.
Sure a lower dollar helps, but then the Americans will crow on about Canadians stealing their jobs.
We've already seen what happens when the US practice protectionism during the recession.
And so the cycle continues.....
China is in the throws of their industrial revolution and that machine is going to be hard to stop.
Until North America gets it's ducks in order, countries like China, India, Mexico etc will get all the low paying jobs.
Things like raising minimum wage don't help either.
Sure a lower dollar helps, but then the Americans will crow on about Canadians stealing their jobs.
We've already seen what happens when the US practice protectionism during the recession.
And so the cycle continues.....
02-02-2014, 10:54 PM
#27
The Fed taper will reduce cheap credit, which has fueled a lot of the US recovery, including in residential real estate. If the US isn't careful, the recovery will snuff out pretty easily. And as the US goes, so goes Canada.
Savers have been punished for years by unconscionably low interest rates. Those who have gorged on debt will unfortunately get hurt quite badly. Cash will once again be king.
The upshot of my ramblings is that we will have a stagnant economy where many will continue to struggle to make ends meet and save for retirement. Stagnant tax revenues will result in increased taxes as governments struggle to service their exploding debt levels and continue to deliver services that citizens have come to expect.
Savers have been punished for years by unconscionably low interest rates. Those who have gorged on debt will unfortunately get hurt quite badly. Cash will once again be king.
The upshot of my ramblings is that we will have a stagnant economy where many will continue to struggle to make ends meet and save for retirement. Stagnant tax revenues will result in increased taxes as governments struggle to service their exploding debt levels and continue to deliver services that citizens have come to expect.
02-02-2014, 11:48 PM
#28
It's not all doom and gloom!
Yesterday I had the "pleasure" of spending a couple of hours at Hermes on Bloor.
It's amazing how easily many people will drop between $3 to $20+K on some funky goods packaged in a fancy orange box.
I swear the store was much more densely packed than most Wal-Marts. Sure, it's just a relatively small segment of the population, however I believe much of the readers of this forum are within that segment and obviously still spending.
Yes the cost of goods will go up, it always inevitably does but look at how this country has prospered through all and every economic turmoil over the past 25 years. Most families I know are living in a much higher standard and have a better quality of life. How many guys you think we're on Porsche forums back then or even 10 Years ago?
I believe that growth and prosperity will definitely continue regardless of any short term economic conditions.
cheers to better days ahead!
Yesterday I had the "pleasure" of spending a couple of hours at Hermes on Bloor.
It's amazing how easily many people will drop between $3 to $20+K on some funky goods packaged in a fancy orange box.
I swear the store was much more densely packed than most Wal-Marts. Sure, it's just a relatively small segment of the population, however I believe much of the readers of this forum are within that segment and obviously still spending.
Yes the cost of goods will go up, it always inevitably does but look at how this country has prospered through all and every economic turmoil over the past 25 years. Most families I know are living in a much higher standard and have a better quality of life. How many guys you think we're on Porsche forums back then or even 10 Years ago?
I believe that growth and prosperity will definitely continue regardless of any short term economic conditions.
cheers to better days ahead!
02-03-2014, 01:29 AM
#29
Nordschleife Master
this story reminds me of tiffany's at yorkdale mall.. the length of the lineups make me wonder if all the stuff in there is free or something.
It's amazing how easily many people will drop between $3 to $20+K on some funky goods packaged in a fancy orange box.
I swear the store was much more densely packed than most Wal-Marts. Sure, it's just a relatively small segment of the population, however I believe much of the readers of this forum are within that segment and obviously still spending.
I swear the store was much more densely packed than most Wal-Marts. Sure, it's just a relatively small segment of the population, however I believe much of the readers of this forum are within that segment and obviously still spending.
02-03-2014, 08:29 AM
#30
Unfortunately, this affluent segment of society doesn't move the needle much for the broader economy. Porsche keeps breaking sales records, which is akin to lineups out the door at Tiffany's. But this isn't reflective of Canada's economic health as a whole. I suspect many (but of course not all) of the shoppers at Hermes on Bloor St. have made or make their wealth outside the country. I would say for a better reflection of how things are going, talk to a sales associate the next time you pop into Best Buy or Future Shop.