Saturday, January 28, 2012

Bank Liars

The Bank CEOs have become veritable Pinocchio's. They or their economists keep sounding the alarm about the highest level of consumer debt ever, the housing bubble etc and yet the banks are trying to convince consumers to take on even more debt!

Contrast what they have said with what the banks are doing:

1) Nixon. CEO of Royal Bank:

"When you look at markets like Vancouver and Toronto there is a level of caution from a risk perspective that is higher today than it would have been a couple of years ago," he said.

"When you look at the condo side there is probably vulnerability ... it is the area which is most vulnerable with respect to Canadian housing."

2) Downe CEO of Bank of Montreal

Bank of Montreal president CEO Bill Downe agreed there is a risk of a downturn in the housing market, saying the best hope is for a soft landing.

"There is no question that the warning signs around the Canadian housing market have been visible for more than a year," he said, also mentioning Toronto and Vancouver specifically.

3) Clark CEO of TD Bank

However, given that the ratio household net debt to income levels sits at a historic 150% — meaning mortgage and other debts are 1.5 times a Canadian household's average income — it would be risky if debt levels rise further.

Here's what their banks are doing:

Bank of Montreal just had a gimmicky 5 year 2.9% mortgage to squeeze a few more buyers into debt before the 'best case soft landing ' comes along.

Hat tip to VREAA

Meanwhile here's what Scotiabank says: However, household spending gains will be dampened by weak job creation and rising consumer debt, now at record levels.

You know Scotiabank, they guys who have come up with the 'You are Richer than You Think' ad line. What does that mean?? Most of us are more indebted than ever and are suffering with stagnant wages and yet we are supposed to be richer??


BTW how much do they get paid. About $8 -16 M a year- then there are benefits and pensions to add in.


Surrey including Whiterock (where there have been some HAM sightings)

1682 SFH listed.
102 sales since Jan 1st
167 if you go back all the way to Dec 15th to date.

Either way a lot of inventory and not much interest. Haven't been there for a while, but I think I will go down next week-end and see the forest of for sale signs where there used to be real forests :)