The popularity of variable rate mortgages should come as no surprise to anyone who has noted the relentless fall of interest rates over the last 40 years. Despite frequent warnings that rates are going to rise, the trend continues downward, encouraging Canadians to pile on ever more debt in a frantic search for capital gains.
Huebl says the moves follow a fall in bond yields over recent months, which tend to lead fixed mortgage rates.
According to Ratespy.com, the best 5-year variable rate among all lenders right now is 0.98% and the best 5-year fixed is 1.75%.
There is little chance that the downtrend is going to reverse, given that this is a feature, not a bug, of fiat currencies. It is not rising rates that Canadians should be concerned about, but rather financial markets that are pricing capital as if it effortlessly self-replicates.
When do we hit the runaway inflation part that leads to crushing interest rates?
4-5 years
Of course, the big multinational banks are blameless. Only the little national guys are at fault, and beyond them, the individual victims of these predatory assholes, those stupid enough to listen to your BS, those stupid enough to have thought you assholes were on our side, there to help us have a home in which to raise a family, etc, you fucking assholes.
Fuck off.
The bankers, like the rest of the establishment, are anti-life. Period.
YW
The BANKERS are one and the same as those who instigated and control the COVID shitshow….under the auspices of the CCP.
Same Filthy NAZI mofo’s: Rothschilds, Soros, Rockefellers, DesMarais, Westons, Bush, Bronfmanns, Gates, Davos Gang, Bilderbergs, the Vatican & the new punks, ZuckerBerg, Bezos, Dorsey, oh..near forgot the Ratfuck Royalty etc,,,
Indeed the big multi-nationals are blameless. They do their jobs they don’t set policy.
The stupid little regional banks America has as a consequence of its branch bank laws that bust up what would be a stable arrangement with a few dominant players into a hash of small unstable banks that are prone to failure. Hence all the bank failures that America has and Canada doesn’t. Canadian banking is more free market than America’s.
“They do their jobs they don’t set policy.”
You are a lot dumber than even the most forgiving could have ever given you credit for.
UNthing
“…Indeed the big multi-nationals are blameless. They do their jobs they don’t set policy….”
Jesus H Christ..!!, you literally have to be THE dumbest kunt on the planet to spout such STOOPID shit…
The Rothschilds, Rockefellers, Soros, Gates, Bezos, Dorsey, etc collectively own the handle “Multi Nationals” – The Rothschilds themselves literally INVENTED big Fucking Banking..& did so long before your forebears stopped swinging from vines ffs. ~1500/1600’s
Stick to LGBTXYZBONEMEUPMYASS stoopidity….I’ll aclaim you as an expert.
steakman, Although your posts are somewhat “peppered”, you’re not wrong, and thanks to some of the links you have posted, I have greatly increased my education on the matter in question, so thanks for that.
“given that this is a feature, not a bug, of fiat currencies”
Only stable ones. When the currency is debased, it makes sense to move into housing AND to charge high interest rates, hence the situation of the ’70s and briefly at the end of the ’00s where the interest rates spiked. When the US was on more or less a de facto gold standard in the ’80s and ’90s, housing prices were kept stable and interest rates low.
The problem here is not variable rate over fixed rate mortgages. Over the years they give better value. The problem is if the banks are using them to help borrowers qualify for higher mortgages.
Fascism with Chinese characteristics has been immensely profitable. The CCP has shoveled the proceeds of slave labour into Western government debt, even at laughably low yields, to buy control over Western governments.
Any yield the CCP earn from their “investment” is of secondary importance to having the option of destroying a western country’s financial system overnight if its government falls into the hands of people who refuse to allow the Han Chinese to enslave their loved ones.
there is one flaw, they might run into a government willing to exercise the Argentine option, which can negate the chinese play, but they have to be willing to accept a bunch of short term pain.
Western gov’t could only sell out if they are corrupt.
You blame western corruption on the gooks.
You are no different than the commies, who use whatever excuse you can to stick it to the little guy, the consumer, the bourgeoisie, this time on a foreign enemy. Take a look in the fucking mirror for a change, asshole.
Oh, our elites know what’s going on, and have profited immensely from it. They call it the “global savings glut.”
Nobody said they weren’t corrupt as their master in hell.
“There is little chance that the downtrend is going to reverse, given that this is a feature, not a bug, of fiat currencies. It is not rising rates that Canadians should be concerned about, but rather financial markets that are pricing capital as if it effortlessly self-replicates.”
No, it should be your currency that you need to be concerned about. No one wants a currency when the Central Banks cede control to fiscal policy and that is exactly what is happening in the US. Between MMT and reckless, unending central government spending eventually no one at the margin wants your currency, In the US here the FED is just Congress’ rubber stamp. The FED will control nothing. Congress conjures up another $5 or $25 trillion out of thin air for Pretzel Worship or Catfish Eating Contestant winners and then what?
Got Gold, silver, real estate and tangible assets? Because no one will want a US Dollar just as no one wanted an Argentine Peso over many periods or a Reichsmark in 1923 when things went tits up. The Euro and Loonie may suffer the same fate. It’s a fast race to the bottom and the politicians are happy to be 100% irresponsible so long as things don’t blow up.
But they will. You can feel it, can’t you?
Eh…Japan amassed tons of debt since 1991 in a failed effort to spend their way to prosperity and financed it with QE way before it was cool but it didn’t tank the currency. Maybe it would have if the US hadn’t tanked the dollar starting in 2000.
I’d say half the commenters here have huge consumer debts
The economy is fucked up, healthcare is fucked up, immigration is fucked up, justice is fucked up. Why?
Fucked up people elect fuck-up governments who proceed to fuck up everything they touch. Everyone is incorruptible. The only political science you need to know.
Always remember. The most important thing to a liberal voter is to feel good about themselves.
Broken record here. Too much money chasing too little opportunity. Give it 4-5 years and you will wish for the good old days.
does this actually mean that there’s no such thing as a money tree?
if so, i don’t think the memo was that widely circulated.
Back in the day, our first mortgage was at 9.5%. We could cope. Then, some six years later, we chose to move (road getting too busy, etc.) and were fortunate that first house had appreciated enough that could put decent down-payment on second house (although, as recall, did have to borrow from parents and new owners of first house insisted we assume some liability; it all worked out). Fortunately, spouse had access to an employee credit union so we could use them (first mortgage at BMO which was okay but) and they would allow payments over the minimum with no penalty. Rode the rate increase up to 16.5% but – because we were already paying extra – no increase in payments. Rode the rate decrease down as well. Today, I look back at those times and wonder at our nerve in going that route. Mind you, I was also very creative at presenting hamburger and chicken (those days, whole was the cheapest) in very varied ways; also managed to persuade offsprings that only those close racks with “reduced” or “sale” were really for purchase.
But..We are all going to be millionaires.
Ask any Justine Worshipper.
Damn shame a single loaf of bread will cost 2 million Justine Bucks..
However because we shamelessly follow the USA,fiscal responsibility by Canada’s Government could be self defeating..
This vanity election we just held,left me with the impression they were all trying to lose.
If holding power when the hot potato of bankruptcy drops is political suicide,then OToole may have outsmarted Justine.
Money is be conjured out of thin air. It is $2 billion / week in Canada from just one of their programs.
https://www.bankofcanada.ca/2021/09/fad-press-release-2021-09-08/
Invest in WheelBarrows…..
My annual financial wizzardry.
You’ll need one to carry the Multi millions in worthless polymer to buy your groceries
Steakman, True story. When Zimbabwe had their runaway inflation, there were indeed people using wheelbarrows to move large amounts of cash around. One poor guy got mugged in broad daylight. The muggers, grabbed it from the guy, tipped out the worthless cash, and ran away with the wheelbarrow.
“There is little chance that the downtrend is going to reverse, given that this is a feature, not a bug, of fiat currencies.”
I do not take for granted the idea that interest rates must continue going down. In the USA and Canada, they’re not far from the zero lower bound. The Federal Reserve and Bank of Canada don’t want them to go negative.
Interest rates on government bonds in the eurozone and Japan are negative. And that has caused their economies much problems.
Justin will be comfortably ensconced in his United Nations sinecure, in a couple of years time, when the shit hits the fan. He couldn’t care less, and his Liberal followers aren’t smart enough to realize they are going to be left holding the bag.