An evening with Mr. Wonderful
https://www.dropbox.com/sc/5kmh2j4nxoxazuk/itCAuJIftj No introduction required, Mary and I were at a function withKevin O’Leary last week, infamous for his role in Dragons Den and Shark Tank. IronicallyKevin was supposed to be the premier speaker at our national mortgageconference in Vancouverlast November, when at the last minute the sponsor pulled the plug and Kevinwas replaced. The reason, Kevin has entered the Mortgage Broker market, and itappeared the sponsor got nervous about his presence and foray into our market,the same sponsor who has Don Cherry as their spokesperson, go figure. Salient points: I'm not a tough guy. I'm just delivering the truth and only the truth and if you can't deal with it, too bad. I'm not trying to make friends; I'm trying to make money. Money equals freedom, (this is what drives people and what people love to see on Dragons Den). Kevin only invests in products that pay a dividend. Never spend the principle just the interest. When I asked if Finance Minister Flaherty went too far with the Mortgage Rules changes, he agreed but indicated we should all be concerned about the possibility of a Canadian Housing Bubble! Great evening, he is everything that he appears to be,brutally honest, and bottom line driven. Love him or hate him, he tells thetruth!
Vancouver the main driver of the Composite in December
Vancouver the main driver of the Composite in December says Teranet and National Bank of Canada
Without Vancouver, the Composite index would have declined for a fourth month in a row. The strength of Vancouver’s index is consistent with continued tight home resale market conditions. Toronto’s index declined for a fifth consecutive month, but the unsmoothed index (see note on methodology on next page) rose for a second month in a row (middle chart). Unless the unsmoothed index relapses in January, the sequence of declines in the smoothed index should then be interrupted. However this improvement is likely to prove temporary, as it might have resulted from buyers rushing to avoid the new bylaws on qualification for an uninsured mortgage (implemented in January 2018). This view is supported by the increase in Toronto home sales in November and December compared to previous months (bottom chart). Therefore, a resumption of the downward price trend early this year cannot be excluded.
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201712 TNB monthly commentary
Bank of Canada increases overnight rate target to 1 1/4 per cent
The Bank of Canada today increased its target for the overnight rate to 1 1/4 per cent. The Bank Rate is correspondingly 1 1/2 per cent and the deposit rate is 1 per cent. Recent data have been strong, inflation is close to target, and the economy is operating roughly at capacity. However, uncertainty surrounding the future of the North American Free Trade Agreement (NAFTA) is clouding the economic outlook.
The global economy continues to strengthen, with growth expected to average 3 1/2 per cent over the projection horizon. Growth in advanced economies is projected to be stronger than in the Banks October Monetary Policy Report(MPR). In particular, there are signs of increasing momentum in the US economy, which will be boosted further by recent tax changes. Global commodity prices are higher, although the benefits to Canada are being diluted by wider spreads between benchmark world and Canadian oil prices.
In Canada, real GDP growth is expected to slow to 2.2 per cent in 2018 and 1.6 per cent in 2019, following an estimated 3.0 per cent in 2017. Growth is expected to remain above potential through the first quarter of 2018 and then slow to a rate close to potential for the rest of the projection horizon.