FRIENDS AND ENEMIES
We’re poorer now than we were a week ago but we’ve made so many friends along the way that it doesn’t matter. It also doesn’t matter because the ETFs are still absolutely screaming in terms of inflows and GBTC is slowing down it’s outflows as clients either decide they don’t want the tax headache, don’t care about the fees, or some combination of the two. The store of value use case has always been solid, but now even the majors are taking interest in the fringe tech updates happening on the network, and our brother Gold is blasting through new highs every day as the war drums continue to beat around the world. All good signs, so hang in there, and keep the DCA rolling (NFA).
Lots of other stuff to discuss from the week that was, so lets get into it.
Canada Announces Changes to Housing Strategy and Purchase Options
The Liberal government announced a few significant changes to the way Canadians will/can purchase homes late last week, saying their new strategy will “solve” the housing crisis in Canada. I’m not so sure, and it seems to me like there is an unwillingness to address the clear issues with the market – supply, because development taxes are way too high, new builds way too low, the number of people pouring into the country way too high, and the number of boomers willing to sell and go down with the sinking CAD ship way too low. There simply isn’t a demand side fix for this problem, and the powers that be seem unwilling to discuss demand at all. They are, however, rounding up social media/podcast personalities and trying to win them over – Steve Saretzky noted on the two most recent Loonie Hour episodes that Mark Miller and Sean Fraser found time to try to woo him, and convince him that they are Doing Something™ to try and fix the problem with housing.
What’s in the proposal? A few absolute bangers:
- A reminder that you can use your FHSA to save
- The ability to stretch your first-time, insured mortgage out to 35 yr amortization
- Now you can pull $60k from your RRSP for your house, instead of $30k
- Government will build 3m new homes or something like that
Someone has to explain this to me, because I don’t see how any of this is a win. Government never comes through on promises related to new anything except taxes, so if you ask me this promise of new housing is a zero. Then we move on to the other pieces – for example, the retirement savings/FHSA use. Are we really supposed to celebrate that, in addition to our longer mortgages, I’m supposed to sacrifice my retirement savings at a time when repaying that RRSP total (which is a requirement, FYI, unless you plan on paying taxes on it as income when you’re earning more money a decade after using it) is harder and harder? And on the subject of retirement, the average first time home buyer in Canada was 36 years old in 2022, it’s probably higher now, so with a 35 year mortgage, is the expectation that we work until 71? Is this an end around to ease the burden on the pension system? What are Canadians supposed to be celebrating here, exactly?
If we zoom out even just a little further, what we’re actually seeing here are measures that will increase demand for homes while supply remains the actual issue. These measures will force prices upward, continue to drive up the CPI contribution from the shelter category, force interest rates to remain higher (maybe, they might cut anyway because they need to save the bond market) which drives affordability down, and forces more of the half-considered measures we’ve become so accustomed to.
I’ve said this before and I’ll say it again – if you own a single family home in a neighborhood of single family homes, you should do everything in your power to never let it go, and never let the neighborhood be negatively effected by high density housing which is naturally geared toward lower income renters/owners. This is harsh to say, but pretending these assets won’t have insanely high value in the future, as single family/low density housing becomes more and more villainized, is insane.
Of course, none of these promises will matter that much when the conservatives take Sussex in the next year or so, but still, good content for the newsletter.
“Undocumented” Person Wants Free Healthcare in Canada
Ohhh boy. As if we didn’t already have to deal with a tectonic shift in immigration sentiment, stories like this pop up and serve to put a face to the issue many Canadians are experiencing as a direct result of our lack of investment in health care, coupled with a massive, unprecedented rise in immigration.
CBC (soon to be defunct, with any luck) reports that a woman who is here illegally was denied a C-section in Edmonton recently, since the hospital – which taxpayers fund, with their labor – asked for a $5000 dollar upfront payment to cover the costs related to the procedure.
When I read this, do I really see a “denial”, or do I see a hospital willing to do the work, for less than the total cost up front, for someone who hasn’t paid into the system at all, even after being here for two years and almost certainly enjoying other taxpayer funded services and supports?
I won’t say, but you can guess.
The article, not doing the woman any favors at all, also notes that she “had plans” (don’t we all) to save up after obtaining a work permit (just haven’t had time in two years I guess, or intention since she came here on a tourist visa) and then bring her 12 year old son to Canada, and raise both the newborn and the 12 year old without the father in the picture. I’m not suggesting this isn’t an unfortunate situation, of course it is, but I am suggesting that there are hundreds of millions of unfortunate situations all over the world and we can’t be made to embrace, welcome, support and shut up about every single one of them, or even 1% of them, or even the ones we’ve already foolishly accepted.
We don’t have the capacity, we don’t have the resources, and we don’t have the patience for further systemic stresses and failures.
AP is Big Mad that Nyms are Crushing Them Online
News orgs are upset that they’re getting absolutely BTFO by online “right wing” discussoooorrrsss and want everyone to have to verify their ID to post on the web. C’mon, after this many years of “alt right” and “Russia” garbage, no one in the writers’ room has been able to come up with something new? No Wojack? No Pepe? Shameful! Where’s the creativity?
Anyway, the piece hisses and screeches and screams into the pillow about how some nym posted some election data and was wrong, but by the time they issued the correction it had already been seen by too many people and was just OUT THERE for the public. The Horror!
Compare this of course to COVID, where every single media outlet reported nonsense (and continues to) for four years plus now, never correcting, never retracting, and even when errors were noted the information had already been seen (and jobs already been lost, families already been fractured, elderly already died alone, vaccines already caused heart inflammation, lockdowns already destroyed the future of children, I could go on) by the entire planet, basically.
I don’t have much else to say about this article except the following: the attack on your anonymity will continue to accelerate because at it’s core, Leviathan requires narrative control to implement every single policy – economic, political and social – at scale. It’s not about whether the policy works, or is a good idea, it’s about you not being able to read other stories similar to whatever negatives you’re experiencing. It’s always been about this, and Leviathan hasn’t updated the playbook (and lacks the creativity to do so) to reflect their new found inability to spin yarn in everyone’s living room 24/7 about their newest policy implementation.
Hey, at least your student debt was cancelled.
See you Monday night.
Joey