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Archive for the ‘General Finance’ CategoryAnother Real Estate BearMonday, July 27th, 2009If you need any reason to feel negative about the future of real estate I suggest you head on over and digest GreaterFool.ca. The author of the blog Garth Turner is hell-bent that real estate in Canada has nowhere to go but south. Garth does have some valid points and he presents them in a witty, humorous way. I must admit I laughed out loud at several of his comments. Links From Around The Web – July 26, 2009Sunday, July 26th, 2009Kathryn from MDJ poses the question Should we be funding our Children’s higher education? Four-Pillars has an article about disclosing your current salary in an interview. ThickenMyWallet compares and contrasts Japan’s lost decade vs. America’s current position. ThickenMyWallet also examines if gold is a good long term investment. SquawkFox debates whether frugal living is just a fad. CanadianCapitalist discusses his doubts on Equity Risk Premiums. Top 10 Vacation Travel WebsitesSunday, July 26th, 2009Looking to get away from the office over the next year? Search the following top 10 list of Canadian vacation travel websites to ensure that you are getting the best deal out there! 1 – SelloffVacations.com
2 – TripCentral.ca
3 – Expedia.ca
4 – Travelocity.ca
5 – RedTag.ca
6 – iTravel2000
7 – BelairTravel.ca
8 – TravelTST.ca
9 – Escapes.ca
10 – ExitNow.ca
If you are aware of any great vacation travel sites that I have missed post them in the comments. Canadian Housing Trend PredictionsThursday, July 23rd, 2009What does the future have in store for Canadian housing prices? A very important question for every home owner and potential home owner evaluating the decision to buy with current interest rates at next to 0%.I recently can across a very interesting blog the other day, that may be able to help you answer this very question. The author of the blog Jonathan, makes some very compelling arguments about why he believes real estate is a bad long term investment and why the Canadian housing market is heading for catastrophe. His post are very well written and full of data driven conclusions. I highly recommend that you read… Links From Around The Web – July 18, 2009Sunday, July 19th, 2009CanadianMoneyForum has a very heated debate on How Much Do You Need to Retire? MillionDollarJourney compares Monthly Income Funds from the Canadian Big Banks ThickenMyWallet has an very detailed post on Investing in REITs Fivecentnickel provides tips on how to survive as a family with One Vehicle. CanadianDream explains why Managing Your Cashflow is the Key to Financial Independence Consumer Price Index – June 2009Friday, July 17th, 2009Statistics Canada has released its monthly report on the Consumer Price Index and inflation for June 2009. The total CPI index declined 0.3% on a year over year basis from June 2008 to June 2009. This is the first reading of deflation and the first decline in the total CPI index since November 2004. This trend is primarily driven by energy prices, if you recall the price of gasoline were significantly higher at this time a year ago. The decline in energy prices was approximately 24.3% year over year. The Core CPI index which excludes eight of the most volatile components (fruit, vegetables, gasoline, fuel oil, natural gas, mortgage interest, inter-city transportation and tobacco products) increased a healthy 1.9% from June 2008 – June 2009. View the full Statistics Canada Consumer Price Index report. View the Bank of Canada Consumer Price Index data. Tax Free Savings Account (TFSA)Wednesday, July 15th, 2009The Tax Free Savings Account also known as the “TFSA” for short is a new type of registered savings account available to Canadians starting this year in 2009. Features of a TFSA
What Investments Are Eligible For A TFSA?The following are primary assets you can hold within a TFSA.
Difference Between A TFSA and an RRSPAn RRSP is a savings vehicle used mostly for retirement purposes, while a TFSA is used for everyday savings. Both are similar in that they offer tax advantages, but they have distinct differences. RRSP
TFSA
TSFA CalculatorGive the TSFA Calculator a try to figure out much you can save with a TFSA over time. Employment – June 2009Sunday, July 12th, 2009On friday Statistics Canada released the June 2009 Employment Numbers. From May to June 09 Canada lost around 7,400 jobs. The graph below illustrates employment in Canada over the last two years for all Canadians 15 and older.
The absolute number of jobs losses appears to have levelled off from what we exeprienced from the peak in October 2008 until March 2009. However when you dig into the numbers you’ll notice that Canada is still losing a decent number of full time jobs (-47,500 from May – June) while part time jobs are being created (+40,100 from May – June) which is giving us this net sideways trend. See the graph below that displays the month over month growth in full time and part time employment.
With the recent month over month job losses in combination with an increased number of people actively looking for work the unemployment rate jumped from 8.4% to 8.6% from May to June 2009.
The key takaways from this data is that Canada still continues to lose full time jobs and unemployment continues to creep upwards. Although the decline in employment is not as bad as it was in Q1 we are still not outr of the woods just yet. Take this into account when making any projections about the timing of an economic recovery.The US Debt Problem.. How Big Is It?Tuesday, July 7th, 2009One of the investment newsletters that I regularly read from an investment manager is Eric Sprott’s “Markets At A Glance” which he publishes monthly at Sprott.com. His latest newsletter for June titled “The Solution… Is The Problem” talks to the specific issue of US Government debt and the future implications for investors given the amount of money that the US Federal Reserve is printing in order to finance this debt. In 2009 the US Government must sell $2.0 trillion in new debt in order to finance an expected budget deficit of $1.85 trillion and $196 billion for the wars in Iraq and Afghanistan. The large budget deficit is due to all the money dished out this year in the form of bailouts (GM, Chrysler, AIG etc..) and economic stimulus aimed at breathing some life into economy. To put these numbers in perspective the 2008 US budget deficit was $455 million which is by no means small in itself. So what does this all mean? It means that the US Government will have to find buyers for 3x the amount of debt that was issued last year. This is all fine as long as there are enough investors out there willing to buy all this US debt.
In the newsletter Sprott analyzes each class of investor who could potentially be a buyer of this $2.0 trillion in new US debt and comes to the following conclusion.
So if there are no buyers out there with any capacity to absorb all this US debt what will happen? The US Federal Reserve will step in to support the US debt market as the lender of last resort. How will the US Federal Reserve fund the purchase of all this new debt? You have probably already guessed it, by printing new money.
Implications For Investors
Save Our CEOs – New Michael Moore FilmFriday, July 3rd, 2009Like him or hate him Michael Moore is going to be releasing a new video this upcoming October that discusses the events of the most recent global financial crisis. I am definitely interested in viewing his latest documentary to hear his opinions on the global meltdown. You know he is sure to implicate the government and big banks in all of this. Here is the teaser video… |
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