Welcome to the ACT podcast , your daily source for what's new for accredited investors. Canadian professionals who are busy contributing to human flourishing deserve exposure to tools designed for favourable outcomes. Tune in now, it's time to ACT! Episodes are short and brought to you by your host Sam (author, syndicator, investor, developer and Ret. Cst)
Episodes
Thursday Jan 25, 2024
Immigration- A.C.T.02024.01.25
Thursday Jan 25, 2024
Thursday Jan 25, 2024
Canadians have a low birth rate. This should mean population decline over time. You can see it in many families. My mother had eight brothers and sisters. I have three. Between we four siblings who are all in our 30s, we have four children, so the seven of us including our spouses are not replacing ourselves either. The population pyramid is upside down in my family, and in many families. This means unusual family dynamics compared to what has traditionally been true, where grandparents need to alternate Christmas and birthdays with the grandkids because there are more grandparents alive than there are grandkids. An upside down population pyramid creates a lot of pressure for the younger generation. The attention of my wife and I has been pulled toward our ageing parents as well as childless uncle’s and aunts growing needs as they age. Fewer younger people to support a larger, ageing population is a recipe for burnout and economic stagnation. The only reason we do not have a population decline and the extreme hardship associated with it is because of our immigration policies, and on a recent podcast episode I shared how economist Benjamin Tal said the only reason we are not in recession is because of immigration. Newcomers to Canada have been making the news as scapegoats for the housing crisis. I am familiar with immigrants to Canada because half of my staff are applying for permanent residency, and most of the new tenants that I have placed in the last couple years have been new arrivals to Canada, mostly university students and their families. The education pathway is very common for people trying to immigrate. They come for an education and integrate themselves into the community through work. I have found them to be extraordinarily hard-working, motivated and diligent. The brightest and most industrious people from other nations come here for a better life because life at their country of birth is very hard for them. I have heard stories of standing in lines and large crowds, attempting to get some cooking fuel and other basic needs. There is a housing crisis in Canada. We have a shortage because not enough new supply is being built. Most of our rental housing stock is from the 80s earlier. Foreign students have been blamed for the high cost of housing, which is not fair to them. There is new and hasty policies put in place designed to curtail the number of foreign students who come to the country and changing financial requirements on those who can stay. I’ve linked an article in the show notes where the publicly funded colleges of Ontario are complaining about the new requirements and how unfair they are. https://apple.news/AvwEelGqcRvq6ITIA_L9VUQ I have seen this firsthand hand with some of my tenants being forced to leave because they cannot afford the cost of living. They have high expenses, and frequently minimum wage jobs. To remain in Canada and have your visa renewed the rule used to be that they must show a balance of $10,000 in their bank account at all times. That dollar amount has now been doubled to $20,000. One of my good employees was told he would not be able to renew his work visa and his wife was not able to renew her study visa because they did not have the cash in their Canadian bank account. they have money in their foreign bank account, but they come from a country where the infrastructure is so poor it is impossible to withdraw funds without going there in person. This is the same place that has fuel shortages and food shortages at times so it is essentially a banana republic. If my employee was unable to show he had enough money in his bank account then he would not be able to renew his family’s visa. His wife is taking a masters, as well as working as a teacher at an elementary school part time. I believe that he and his wife and his son would be valuable members of our society if allowed to stay, so I loaned him the money he needed. For another staff member, I have hired an immigration lawyer to assist him with the application process for his permanent residency, because he has special skills I have not been able to find in Canada. I get the benefits of loyal, hard-working staff, and they get the benefit of a pathway to citizenship in a country that will give them and their children the opportunity to obtain prosperity that many Canadians take for granted. I hope this episode of the act show has given you a different take on the immigration story, and perhaps will make you think about how you can benefit from the trends. as a housing provider, my industry stands to benefit because population growth leads to GDP growth which leads to jobs which leads to migration which leads to higher prices of real estate and rent. The shortfall of housing we have is indeed a big problem that we are facing, but remember that the larger the problems you solve, the larger your paycheques will be.
Thursday Jan 25, 2024
Interest Rates- A.C.T.02024.01.24
Thursday Jan 25, 2024
Thursday Jan 25, 2024
Today’s headline news in my feed was that the bank of Canada has decided to leave the overnight rate at 5%. There’s speculation that the overnight rates will drop in the spring or summer. What does this mean for you as a business owner or investor? The availability of credit pumps up asset prices. If the cost of servicing debt is very low, there is more willingness to pay more for the fixed amount of goods and services in an economy. If the cost of goods and services increases, this is inflation. The central bank can set the overnight interest rate in an attempt to influence the cost of credit and thus the prevalence of inflation. What do interest rates do in my industry of rental real estate? Higher Interest rates makes it more difficult for people to qualify to purchase a house, this keeps people renting for longer and increases the Tenant pool. Where I have property, it is difficult and expensive to build new property so a larger tenant pool increases the market rent,. Lower interest rates allows for increases of real estate prices values. The interest rate is more of a neutral factor. Overnight interest rates affects Short-term debt servicing like credit card debt and variable rate mortgages. Most of my mortgage debt is in fixed rate mortgages which are priced based on the Canada mortgage bond of various maturities, so changes to the overnight rate does not affect my business much. The overnight rate is a neutral factor.
Wednesday Jan 24, 2024
Inefficient markets (vehicles fleet management example)- A.C.T.02024.01.23
Wednesday Jan 24, 2024
Wednesday Jan 24, 2024
Wednesday Jan 24, 2024
Reporting frequency - A.C.T.02024.01.22
Wednesday Jan 24, 2024
Wednesday Jan 24, 2024
How often should reporting be done? Reflection on today’s episode of the accredited Canadian’s toolkit.
Wednesday Jan 24, 2024
Mortality book review - A.C.T.02024.01.20
Wednesday Jan 24, 2024
Wednesday Jan 24, 2024
Horace Mann said “Until you have done something for humanity, you should be ashamed to die” I’ve had the opportunity to reflect on the human condition recently. With ageing family members in and out of hospital and beginning to experience more frequent health problems, and a recent seminar that had many exercises to remind me of my own mortality, It has become a renewed topic of interest for me, and Ive spent some time each day thinking about it of late. Many thoughtful people have commented on this, but a very interesting and fresh perspective for me is that of Christopher Hitchens. He wrote a series of columns in vanity fair, while he was in the process of dying from stage 4 esophageal cancer. his editor compiled them all together into a book. I’ll review the book and add my comments on mortality at the end. Feel free to skip this episode if the topic is not yes of interest to you.
Sunday Jan 21, 2024
CIBC Interest Rate Prediction - A.C.T.02024.01.19
Sunday Jan 21, 2024
Sunday Jan 21, 2024
I read an article today by Jennifer Dowty of the globe and mail. I’ve linked it in the show notes. https://apple.news/AsTqUftr8R3StcKqNGFWjJA It was an interview article of cibc economist Benjamin tal. Of interest he said the only reason we are not in recession is because GDP growth is being propped up by population growth. I found this funny because it’s this very population growth that is making negative headlines right now about how we need to restrict newcomers to Canada. I hope it is apparent that since immigration only thing keeping our economy from contracting, restricting immigration is the wrong approach. Most people would agree that growth of the economy is a good thing, and the fact is we need people to make that happen so rather than curtailing immigration, we should be building infrastructure to support it. Anyway, one of the first things Benjamin Tal talked about was a rally in the bond market, and how he thinks it has come too early. Higher bond prices means lower bond yields. This means lower bond interest rates are expected by the bond market. If Mr Tal is right, interest rates will remain high for the next six months with central bank cuts starting mid 2024. He predicts very low growth to Canada’s economy in the coming year. I thought it was interesting that he mentioned the bond market because I have come to understand that the bond market is the leading indicator of all things in the financial system. If you could decipher what the bond market activity means, you know what’s coming next. I think that is because the sentiment of bond traders eventually becomes a self-fulfilling prophecy. The bond market is the largest market in the world. it dwarfs the stock market, and indeed the economies of most countries. The global bond market is 133 trillion. The size US bond market, the largest economy in the world, is 50 trillion. Compare that to other common financial metrics like US debt of 34 trillion, and the US GDP of 23 trillion and you see that bond markets are the biggest, biggest and most important part of our financial system. Bond markets are a reflection of how we choose to interact with each other, so I find it interesting how little bonds are talked about and how misunderstood and misinterpreted bonds are by many people, including me. I struggle to understand how the bond market actually works but I’ll share my findings below. I welcome any comments on this, so please reach out to me because I’d love to learn more about this. This is a bit of a tangent, but I believe it’s worth saying. I think of the behaviour of the people that make up the bond market as the first mover. Whether there is no bond market activity and no availability of debt, prices and economic activity are low. When people invest in debt, economic activity rises. Similar to how having a positive mindset will generally lead to positive results. If you have hope for the future, then you will take actions today that may cascade into positive results. If you fear a bleak future, you will not take those initial actions. This is a tangent, but I think about how human agriculture was such a turning point in our evolution. The neighbours of those early farmers must’ve thought they were crazy, sacrificing today’s food in the hopes to yield more in the future. In cursory google searching I found some crops are much higher yielding than others. For instance, some US sources site that the average amount of seeds of corn planted per acre is approximately 30,000. 30,000 plants will produce one or two ears each. Each ear of corn has approximately 600 seeds. Ignoring all other inputs This means that nature allows us to turn 30,000 seeds into up to 36 million. 600 to 1200 seeds for each corn seed planted means the return on investment 60,000%. with yields like that it’s no wonder that we have corn in virtually every processed food, and even added to gasoline. Of course, not every seed you plant will germinate, and crops can be ruined by weather and pestilence. There are labour costs and equipment costs and fuel costs. so the return real on investment and time might be much lower. My brother works as a farmer of sorts and he tells me the average yield in agriculture is about 17%. Actively cultivating hope for the future means you will have energy for today. Since the bond market is the leading indicator, the yield curve of the two year to the 10 year bond being inverted tells us that there is a recession coming or underway. In the US every single time the bond deal corrected itself to become positive that is when the recession hit. Some people will be caught by surprise when this happens, so this will create some distressed sellers. Now is the time to prepare to purchase the distressed assets so you are ready to move when opportunities become plentiful. Opportunities are for optimists. Otherwise they would be called pessimitunities.
Sunday Jan 21, 2024
Sunday Jan 21, 2024
After an unseasonably warm winter, this week of January has been a deep freeze. we’ve seen our properties in southern British Columbia experience frozen pipes and heating systems are struggling to keep up. This is the time of year that Contractors can make a lot of money on unprepared property owners. One of the buildings I own is managed by a third-party agency. Things were running pretty well until a key man who worked for a the heating company we use moved cities. The same company continued to service our heating system in this building, but the key employee who knew the building inside and out was now gone. The replacement technicians, this heating company was sent to the building did not have the same familiarity with the heating system. The result was inconsistent maintenance and a failure to address a slump in the exhaust for the boiler system. An anchor had detached from the wall, causing the exhaust to sag, and this sag caused condensation to accumulate. so much water accumulated that it blocked the pipe. The fan motor in the boiler was unable to keep up because it was pushing on water instead of air. We were repeatedly replacing boiler fan motors without addressing the real issue, which was the sag and belly that had formed in the exhaust. on New Year’s Day tenants were calling the property manager complaining that there was no heat. The larger boiler responsible for the heating system is 399,000 BTU and the fan motor had failed again. The property manager called the heating company who were very busy that day., diagnosed the problem as the fan motor, which was still under warranty since it was replaced last winter. They took a day to order the part and were informed that it was on backorder for two weeks. The heating company suggested providing the tenants with electric heaters until the fan motor arrived. When the Property Manager called me about this, I did the math and found out that 49 units requiring electric heaters at a cost of 100 or $200 per unit would buy me a new boiler. The property manager asked the heating company for a quote for a new boiler to be installed right away. The new boiler was a different brand that was in stock and including labour could be installed before the weekend and the quoted price was approximately $19,000. I thought that was quite expensive, so I called one of my partners who has been in plumbing for decades. We found a boiler at the wholesaler for $9000, it was an IBC, the same model as the one that had failed. This is important because it would be a quick removal and replacement with. I need to change the copper supply and recirculating lines which on the last boiler I did added about $3000 in fitting, pumps and valves. I found a willing hard working plumber who had a hole in his schedule and came out for the day to replace the boiler fee for the 12 hours of labour for the plumber and his apprentice was $1500. The parts were approximately $1000, and included the work we conducted rerouting the problematic exhaust and fresh air intake. By spending a day on this problem, I saved the property approximately $8000 on this boiler install and we solved the problem without doing the Band-Aid of purchasing electric heaters which have not have done this sufficient job and present a fire risk. We have now finished troubleshooting the smaller boiler which is 299,000 BTU and it was found to have a cracked heat exchanger. The new larger boiler is on order and we will likely replace it next week, with the same IBC boiler that we installed in the first week of January. It’s important where possible to standardize the equipment so that staff can be familiar with troubleshooting it. It’s the same for the choice of all components in a renovation. Standardization saves time and money in new installs and in maintenance. The moral of this story is that just because it appears to be a desperate situation, try to detach and think about all possibilities. in this case no the crisis I faced was the prospect of no heat for 49 families when it was -6 out with a forecast of -30 in the coming days, and For the American audience that is a swing from 22 Fahrenheit to -22 Fahrenheit. When I was presented the choice between spending 5 or $10,000 on portable electric heaters or $19,000 on a boiler system, I realized that this was a false dichotomy. Those were not my only two choices and by taking the time out of my busy schedule to get more information and not be pressured to make a bad decision we got the best and most cost effective solution. So if you have a problem, the only thing you should rush is to seek help by calling on as many partners and other service providers you know, because sometimes the best of two bad options you’re given is neither of them.
Thursday Jan 18, 2024
Strata witch hunts & why democracy doesn’t mix with business - A.C.T.02024.01.17
Thursday Jan 18, 2024
Thursday Jan 18, 2024
I had a run in with one of my family’s strata council recently. Before I tell the story, I’ll share with those unfamiliar that a strata is an ownership structure, where an apartment building or condo building is owned by a large group of people who typically live in the building. This living arrangement is typically more affordable than a single-family home but there are ownership decisions that need to be made such as Maintenance of common areas and building components, services like trash collection and the arbitration of disputes between neighbors. These decisions are made by a group of representatives of the owners who are voted in by the owners every year. These people are called the Strata council. When a building or community is running adequately well most people take little interest in its governance, because they are busy leading their lives. Voter turnout is notoriously low in all sorts of elections and Strata annual general meetings also called AGM’s are no different. Low turnout is the norm. Serving on a strata council can present an opportunity to experience governance firsthand, and for many Strata councils many members who are elected have no prior expertise with governance or prior experience in business. They volunteer their time, and the position comes with a modest amount of power, so, naturally, this will attract some bad actors whose motivation is the Lord over their neighbors,. From my American listeners, this form of governance is similar to the homeowners association that you may have heard about in the news. One article that I have linked in the show notes, accurately describes this type of ownership as been controlled by “neighbourhood governments that have brought abuse, acrimony--and seemingly absurd litigation.” http://www.ccfj.net/HOAgenLoathe.html In the case of my family member’s dispute, there were some minor alterations done to the inside of the unit which included flooring, paint, and countertops. The Strata president is a rather sensitive person to noise and when returning from vacation noticed the downstairs neighbour, my family member, had workers making noise associated to the upgrade. It was alleged that the noise was happening outside of working hours, after 5 PM. One such incident happened during daylight savings clock adjustments and the Strata president strolled downstairs to tell the worker to be quiet because it was after hours, however, because the clock had fallen behind by one hour, it was in fact, not 530, but instead 430. The Strata presidents’ error was not caught and my family member received $100 fine for Noise. No evidence was presented, so a fine was issued without any due process. Furthermore, the strata corporation demanded that a permission form be filled out for repairs to common property. Since there was no alteration being done to the common property and only to my family members property inside the Strata lot, permission was not required. My family member asked for detail about the noise violation and stated that permission to make changes to her Property was not required. My family member was given a response that another fine this time for $200 would be issued for failure to fill out this permission form, and for more alleged bylaw violations for noise. My family member asked for a meeting as is her right to be heard by the Strata council. At the meeting the Strata president was very aggressive yelled at her “I don’t like you period” so the real motive for the fines became apparent. Despite his conduct, Strata decided to rescind the $100 fine for noise, because there was no evidence of noise caused contrary to the Bylaws. The Strata council decided to insist that the permission form be filled out retroactively for the alterations that had been completed, with the promise that a $200 per week fine would be issued if this form was not filled out. The basis for this was a very thin case, and that is a provision in the bylaw That permission is required to alter anything The strata corporation was required to carry insurance coverage on. I helped my family Member draft a letter detailing why there is no need to ask for permission, and that this position directly contradicts another section of the bylaws that explicitly states altered property within the Strata lot, that was not originally installed upon construction, is not the responsibility of the strata corporation to insure. Since there were prior owners before my family member, there was no way for Strata to know if the alterations were done to Original fixtures. Given the age of this building, it is unlikely that my family members modifications were the first time floors or paint or the kitchen was upgraded. The requirement for this permission form by Strata and the threat to find my family member $200 a week If they did not comply is plainly a power move motivated by a personal vendetta of the Strata president against my family member. The most expedient way to deal with this may have been to fill out the permission form. This course of action left my family member nervous that she would continue to be targeted by the Strata president unjustly, so this was a fight that was decided it was worth seeing through to its end in an attempt to educate the strata counsel what the byelaws actually means. The unfortunate thing is that the people charged with governing this strata corporation, and who have been voted in, are unfamiliar with the law, and don’t understand the bylaws They are attempting to enforce. Today’s letter cost me several hours researching and formulating the argument, but I believe it will be successful and I am happy to help a family member. I will try to remember to share the outcome of this dispute in a future episode. The point of the story which I am trying to make is that wherever possible, when in business avoid a democracy. A democracy is fine and preferred when dealing with very large groups of people such as an entire country, where the cost of friction between politicians is diluted among the entire population. As a high value Canadian where your time is one of your most valuable resources, the cost of becoming embroiled with in fighting with unprofessional people who are unsuited to hold any sort of power is very high. The cost is peace of mind and could also include significant monetary cost as well hiring legal help or paying unjust fines, or paying special assessments, because the finances were mismanaged by inexperienced people. When considering buying an investment property, If you can afford to own freehold property, such as a single-family home, not governed by a strata or co-op or HOA, your cost of ownership will be much lower. And your piece of mind will be higher. I have owned several strata units, and I served on the Strata counsel for these. this was a self managed Strata at the time so the infighting was far worse. They were a useful investment for me at the time of purchase because they required little investment capital to get into them. I have since sold all of them, and I am grateful for the experience and the profits made, but I am confident that I will never purchase this type of property again because of the headaches and costs associated with group ownership. Strata corporations, and other smaller groups do not have a large enough base of people to support Thier own cost of governance, and thus rely on volunteers, who are giving up their time for free. Do you know the saying, that you get what you pay for. Free advice is free for a reason and that is usually it is not very valuable. So, in conclusion, my opinion, is that In business, it is better to have a dictatorship, with a singular competent leader, who controls everything. Most successful companies have a singular CEO, who is an expert in their field. People buy shares of these companies, but do not exert control over them. I hope this gave you something to ponder.
Tuesday Jan 16, 2024
The music inside you - A.C.T.02024.01.16
Tuesday Jan 16, 2024
Tuesday Jan 16, 2024
Today I am sharing my experience at various mastermind groups in early January. It’s common this time of year to take inventory of previous years and plan for the future, and that’s what I’ve been led to do. This happened after I’d taken a hiatus from publishing anything for a long time due to a focus on helping with some personal hardships of people very close to me. Cancer is a terrible illness as anyone who has gone through it, or who has supported someone through it can attest to. The hardship isn’t over yet, but I Found that by attending mastermind groups again it has made me realize that we miss out on when we don’t do our primary work. In the words of Oliver Wendell Holmes: Many people die with their music still in them. Why is this so? Too often it is because they are always getting ready to live. Before they know it, time runs out.” I’ve heard this quote and sentiment attributed to others, including Wayne Dyer. It seems to be a universal yearning for creative people, but often something gets in the way. Steven Pressfield calls this resistance in his book turning pro. Something that had a big impact for me was the realization that as a man in my 30s I’ve got maybe 30 or 40 energetic years left that’s roughly 11 thousand to 15,000 days so if I spend those days wisely, then my body of work can impact many other people into perpetuity, for my children. I have vague memories of my great grandparents on my mom side, and I don’t even know the name of my great great grandparents. I think what a gift it would be for me study their knowledge from a lifetimes of adversity, success, and failure. I was recently reminded of Gary Keller‘s book, the one thing. What is the one thing by doing it that all other things become easy or unnecessary? For me, it’s building a new habit centred around my health. Portion size is more important than exercise. Deliberately choosing my fuel will allow my engine to run efficiently and for a long time. With that in mind, my one thing was the form, a health habit with three rules. 1. Brush teeth after every meal. a clean mouth will make me less likely to grab whatever is convenient to eat. 2. no food after 8 PM. Intermittent fasting is beneficial and this is how I will start. 3. To bed and at the same time every day. For me, this means some melatonin and a book so I can fall asleep by 10 PM. my alarm will take advantage of my recent jetlagged schedule to get me up every day at 4 AM. I need a nap Midday, then I’ll take it. I hope that by sharing this, I have helped you think about how you will show up in the world, and I encourage you to strive not to die with your music still inside you.
Tuesday Apr 20, 2021
ACT 36 - This Time is Different
Tuesday Apr 20, 2021
Tuesday Apr 20, 2021
Canada's Liberal government released their budget yesterday, and I've included some highlight that will be of interest to Accredited Canadians.
Happily, there was no significant tax increases. No increase in capital gains, no wealth tax, no tax on the sale of a principal residence, and no large increases to income taxes. There is however a 10% tax on vehicles and airplanes over $100,000, and boats over $250,000.
There is a lot of spending announced, with pundits calling this an election budget. I watched with interest Pierre Poilievre's reaction to the budget and as usual learned interesting history and facts. I had the pleasure of meeting Pierre at a wine and cheese last year and we debate the merits of universal basic income. What stood out to me in his speech yesterday was the following points:
Drs. Reinhart and Rogoff from Harvard are the authors of the widely acclaimed book on the history of financial crises going back 800 years, the book is called, This Time is Different. Pierre goes through the five leading indicators of a debt crisis and how they relate to Canada now. He says:
Number One: Canada has declining output, last year we lost 120B in GDP
Number Two: Large and sustained current account deficits (net importer of goods), yes for the last 5 years Canada has had $300B in current account deficits
Number Three: Asset Price Inflation - Canadian housing has been up over 20% in many markets where the income has dropped. Vancouver and Toronto are among the top 10 most expensive housing markets on the entire planet.
Number four: Rising houshold leverage ie. $1.75 of debt for every dollar of take home pay, the highest ratio in the G7 and nearly a recording in Canadian history.
Number five: A rise in the overall debt across the economy. Last year the debt was equal to 17% of GDP, the largest single amount since WW2. As a share of GDP the debt was 2x the size than in WW1, 3x the size as the great depression, and 4x the size it was in the great global recession.
All leading indicators are satisfied, and Pierre Poilievre says that this time is NOT different, even though we want to believe it is. Pierre argues we have been here before in the 1980s under Prime Minister Pierre Trudeau, back then he was running a deficit of 11% of GDP compared to a deficit of 17% of GDP in 2020. Back then there was money printing, also known as an increase of the M2 money supply, the printing was 15% compared 13% now. Back then Federal Government spending was over 20% of GDP, now it is almost 30%. We had stagflation in the early 1980s, there were 650,000 more Canadians in poverty over 4 years, a 25% increase in poverty from 1980 to 1984. Inflation hit 12%, and unemployment hit 12%, both all time highs. There was also an all time high in interest rates at 18%.
Pierre brings up the terrible outcome that could await Canadians, and brings up the Misery Index where unemployment and inflation are added, and shares that when the Misery Index increases, suicides go up. In the 1980s Canada saw the highest incidence of suicide ever at about 15 people per 100,000. Data around the world shows financial crisis cause on average the unemployment rate to rise 7%, and according to the University of Calgary for every 1% increase in unemployment there is a corresponding 2% increase in the suicide rate.
(To be fair, R&R's findings, methods and rationale are disputed and for good reason, read this article to learn more: https://www.theguardian.com/commentisfree/2013/apr/16/unemployment-reinhart-rogoff-arithmetic-cause)
I don't agree with Pierre's recommendation to harken back to the 1940s era where the silent generation worked off the WW2 war debt by 1947, and the economy grew by 35% per year from the end of the war to 1973. This was largely due to industrialization and increased production, coupled with an explosion in population known as the baby boomer generation.
While Pierre is right that we have a technological revolution happening now that will enrich everyone, technology is in fact deflationary as I covered in Podcast episode 9 where I reviewed Jeff Booth's book.
I think the best model for our future is actually the 1995 budget, a Liberal government where Jean Cretien and Paul Martin were leading. The budget in 1995 involved modest cuts to government and programs that didn't impact average Canadians, and this was supported by Canadians of every stripe. We also need to either have a ton of babies, or allow a lot more immigration of people under 45 so we can get back to a healthy consumption led economy.
Regardless what I think, that increasing the money supply by printing dollars isn't a great solution, it looks like this is exactly what Liberals want to try doing right now. Spending a record level to stimulate the economy and buy votes, and printing like mad to monetize the debt looks attractive, but in fact it steals productivity from hard working Canadians.
I don't know what the future holds, but the fact a Canadian politician like Pierre is speaking about this debt crisis in the house of commons lifts up my spirits, it means even politicians who are clueless about what they are doing to Canadians by printing so much money are at least hearing this point of view, and may take pause before voting in free stuff so fast that the system collapses.
It looks like we have another year before large tax hikes, so the takeaway now is to prepare for future tax increases, and consider taking some money off the table in markets that have raced higher and faster than we've seen in a long time. You may soon be able to redeploy the investment in growth markets, or to be ready to snap up discounts and weather the storm if and when it arrives.