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Would be a welcomed relief if house prices dropped and my kids would have an opportunity to get into the market. However on the flip side what does that mean for people that have used up the equity in their homes to pay down credit cards, car loans etc...... This could go either way and I too would love to jump in and buy a few houses if prices drop.
I'm only buying new stocks easy money you know they are only going up. They have been up the last week but I see one more big drop coming in the near future. If I am wrong oh well still easy money if you buy before we get outta of this mess.
Invest wisely there is some good money to be made this year. [emoji106]
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Almost chuckling at wishful thinking for a real estate crash. :)
Guys. As appealing as it might sound, you don’t want it. And that’s a snowball should it get going that would be impossible to stop. Could, make what happened in the US in 2008 seem like child’s play. Because CDNs as a whole have more household debt today, than Americans did in 08. Because our real estate, since 08 has been on a tear. People paying stupids amounts. Taking huge mtgs. Let’s say you bought a “million” dollar home, and had the 20% down. That still leaves a mtg of 800,000. So when the house won’t sell for 700, or 600, or 500.....
Let’s “play” what if.
The losses the banks would incur could shake the foundations. Maybe they could survive it, unlike banks in the US...or Greece... There would be a credit crunch ( choking off of liquidity, which is like clamping the aorta) just Iike there was in 2008. So everyone’s ability to borrow would be severely curtailed, including companies..Our bank, the one I worked for had trouble getting credit in 08.....and we had billions in assets, hundreds of millions, in capital.....
More job losses, more homes going up for sale,..market values would get kneecapped. Your savings, your RSPs, wiped out.
There are reasons the banks are willing to defer mtg and credit payments. Reasons why the feds are buying up billions in unsecured mortgages, provincial bonds, etc.
remember 08 started with the the collapse of Lehman brothers.And some others engaged in “derivatives”. It shook the world.
https://en.m.wikipedia.org/wiki/Fina..._2007–08
I do not think anyone is wishing for a crash. If life gives you lemons...make lemonade. Or to put it differently , if life gives someone else lemons, buy them cheaply and make lemonade for yourself. Some people, ( those not in debt), made a lot of money, or acquired at lot of things cheaply, after the crash of 08. There were still a lot of wealthy people in 1930 as well.
With what Gord? Savings that won't exist ( worst case), credit you may not get, or the hundreds of thousands you have tucked under your bed. :)
CDIC only insures you for $100,000
No need for credit . My stocks are recovering nicely. Have some guaranteed investments spread around with different institutions , that can never lose money. And CDIC covers 100,000 for EACH account. Don't put 500.000 in one account. Open five, with 100.000 each and you are fully covered.
lol. Please don't take this wrong. If we were at a table you'd see the smile, twinkle, and hear the tone of voice.
You don't really understand finance do you?
This is a huge if, huge. One i don't foresee, but never say never is my motto, and these days...Nothing like it, not even the great depression of 1929. And unlike 1929, this is global.
Stocks? What stocks Gord, they won't be worth the paper they are written on. Nor will your pension. Everybody and their uncle will be dumping their stocks, if it starts, and you cannot compete against the money managers. and whose paying you interest? Financial institutions that lend and borrow trillions each day between themselves?
What part of we couldn't get credit....did you not understand? So when one bank starts having trouble meeting their obligations.......
Do you think the province pays off their debt, every single day, that various notes and financial instruments mature? Or do they re-finance? Do you think, the banks themselves don't have trillions in this that and the other, And won't have creditors far larger than you screaming to get their collateral back, their money back? We couldn't " borrow" because we were exposed to X, who was exposed to Y, who was exposed to Z and in trouble...And Ill tell this much publicly, we had things on our books with billions, with CIBC, BNS, OTPP (they farm out risk as well), so when we go down, CIBC and BNS and everyone exposed to us. We were tiny players. Years later we did go down because our liquidity was cut off in Germany.
NBC and OTPP took big hits.
here in Canada, If one bank goes, they all go. Its both a big strength, but also a weakness.
https://fincad.com/resources/resourc...it-derivatives
Unlike the US government coming to the aid of the financial sector to bail them out in 2008,our Canadian government couldn't begin to bail our banks out because it,too,is buried in debt. Our banks will find themselves holding a shyte ton of empty accounts and uncollectable debt when Canadians simply default under the pressure. History repeats itself and we never seem to learn.
How do you think that the USA became the worlds leader in debt owned? But all anyone talks about is how well their economy was doing before C19. They were living on credit, like most governments are going to have to do now. If all banking and financial systems fail , so will our society; the result being anarchy. That is my Nostradamus for the day.
Canadian banks will not fail and our government will not let that happen. Don't forget the Insurance companies as well which are able to take on debt as they are some of the richest in cash!