1026 replies to this topic

[Mike K.]

They're all in the same predicament, I wouldn't worry about it too much, from an investment perspective or an access to capital perspective.

[spanky123]

They're all in the same predicament, I wouldn't worry about it too much, from an investment perspective or an access to capital perspective.

 

Not all, those with mostly institutional investments have more patient money. 

 

If we look back to 2008 we saw a number of retail REITs blow up (League being one local one). Not saying that it a given today but we have a number of REITs that are clearly having difficulties and we haven't actually hit a recession yet or have interest rates peaked. 

 

The other thing to consider is that the portfolios of Starlight, Romspen and others would be very attractive to our socialist overlords who think that the root of all evil is private housing ownership. Being able to acquire tens of thousands of units at a cheap price to then rent out at below market values to their supporters and buddies would seem like a wet dream.

Edited by spanky123, 28 November 2022 - 09:27 AM.

[Victoria Watcher]

The Starlight funds affected are US, and quite tiny.

[spanky123]

The Starlight funds affected are US, and quite tiny.

 

True but I predict the same thing will be happening here. Once investors see that the US funds have halted distributions they will start pulling money from other funds.

 

You can get a similar return these days with much lower risk.

Edited by spanky123, 28 November 2022 - 09:39 AM.

[Mike K.]

Not all, those with mostly institutional investments have more patient money. 

 

If we look back to 2008 we saw a number of retail REITs blow up (League being one local one). Not saying that it a given today but we have a number of REITs that are clearly having difficulties and we haven't actually hit a recession yet or have interest rates peaked. 

 

I would not put League in the same arena as bonafide REITs with long track records and significant real-estate holdings. League was truly in a league of its own.

[Nparker]

...the portfolios of Starlight, Romspen and others would be very attractive to our socialist overlords who think that the root of all evil is private housing ownership. Being able to acquire tens of thousands of units at a cheap price to then rent out at below market values to their supporters and buddies would seem like a wet dream.

You're not wrong.

[Mike K.]

Try to make sense of this article.

Bank of Canada might need to raise rates if companies keep raising prices, Macklem warns
https://www.cbc.ca/n...ittis-1.6750879

It may sound like a circular argument, but the only way to stop inflation is to stop companies from raising prices. And the only way to stop that is to get inflation under control. And that could mean an end to the interest rate hike pause.

Tiff Macklem in his testimony to parliament last week offer a stark reminder of how difficult, but how essential, it is to convince the sellers of goods and services to stop raising prices.

That's difficult for consumers, whether businesses buying from other businesses or ordinary Canadian shoppers. Macklem said they simply cannot distinguish reasonable and necessary price rises to cover rising costs from price hikes merely to pad the bottom line.

He warns sellers: if price hikes continue at the pace we've seen recently, he may be forced to take action.

So the long story short is, government can raise taxes with impunity, but businesses should lower their prices, in order to make what the government is trying to do with rising interest rates, happen as it would like it to.

This article sidesteps the growing costs businesses are facing, not just from inflationary pressures but from wage increases (which the article says are not keeping pace with inflation 🤪), more holiday and sick pay, medical premium pay, rising property and municipal taxes, rising crime impacting prices, rising maintenance costs and now, significantly higher borrowing costs.

In the article the falling price of oil is touted as a main contributor to lower inflation. But have you looked at the pump lately? It’s $2 for a litre of diesel, and the government is raising gas taxes further on April 1st.

The article also talks about record profits at major businesses. But is that a surprise, when Canada is growing at record-setting rates? More consumers = more spending. More spending = more profits, if you’re doing things right.

[Nparker]

The really scary part is how many people believe this sort of government BS.

[Victoria Watcher]

It also does not help that we do not have nearly enough competition in grocers.  Competition acts as a check on inflating prices.  When you lack options grocers can and do charge more than they might normally.

 

https://www.statista...t-share-canada/

 

 

 

Our "other" is only 12%.

 

 

In the USA:

 

https://www.statista...t-share-canada/

 

Edited by Victoria Watcher, 22 February 2023 - 08:58 AM.

[lanforod]

That doesn't seem terrible in terms of competition to me, especially know that locally, we have quite a few in that 'other' bucket, Country Grocer, Red Barn, Fairway...

 

Compare it to competition in telecom 

[Mike K.]

Perhaps for groceries it’s more-so the lack of producers and importers, than just grocery store competition.

We seem to have a decent amount of grocery competition compared to a lot of other sectors.

[spanky123]

I was in the US two weeks ago and food prices were just as crazy there. In fact many items were more expensive then they where here (although lots were cheaper to). Food inflation is a global issue at the moment 

[Victoria Watcher]

I was in the US two weeks ago and food prices were just as crazy there. In fact many items were more expensive then they where here (although lots were cheaper to). Food inflation is a global issue at the moment 

 

Well, for once the poultry and dairy cartel is holding prices down slightly here, on those items.  But for 50 of the past 51 years, we have paid more than Americans for it.

Edited by Victoria Watcher, 22 February 2023 - 11:10 AM.

[Matt R.]

Maybe the “experts” should look inwards to see what they can do to help businesses with input costs in order to keep price increases down. I admit, I’m not very sophisticated but thankfully these calculations aren’t either.

[Matt R.]

Well, for once the poultry and dairy cartel is holding prices down slightly here, on those items.  But for 39 of the past 40 years, we have paid more than Americans for it.

Dairy just went up 2-6%. Typically they only raise prices once per year, the last few years it’s been twice. Chicken is way up as well. Welcome to $9 pounds of butter and $10 jugs of milk.

[spanky123]

The really scary part is how many people believe this sort of government BS.

 

I can't copy and paste the chart but basically every inflation and interest rate forecast released by the feds and the BoC since the start of the pandemic has been materially wrong and ALWAYS underestimating the rate. Now at least a monkey picking numbers would be high or low 50% of the time.

 

There is a belief that if you forecast it then it will happen so the plan is to always forecast where you want the outcome. Fair enough but then you lead to the situation today where NOBODY trusts the Government or BoC. 

 

The best place to get an idea of outcome is to look at the capital markets where action dictates results. As an example, the BoC 5 year bond rate has been increasing steadily after having dropped at the end of last year. What the markets are clearly saying is that they believe inflation and interest rates are going to continue to rise / hold flat for an extended period as opposed to seeing any relief in the near term (ie next couple of years).

[Victoria Watcher]

I will admit I have cut back on eggs a bit.  Caviar, that is.

[spanky123]

^ Well you retirees are in a pretty good spot at the moment. Anyone who is sitting on a bit of a nest egg after having downsized / retired over the past few years is doing well. You can safely get close to 6% in an investment account up from 1% two years ago. I know a number of people who now have an extra $50K+ a year to spend without drawing down their nut and they are converting that in night's out and extra vacations. With our much older demographics than the rest of the country, I can see Victoria faring much better than other regions.

[Victoria Watcher]

That's a good idea, I'm going to check my nest for eggs.

[Nparker]

The government keeps taking my eggs before I can get any of them in my nest.