Economy Headed For Tougher Times

[canadairguy]

An interesting blog post re the Canadian Economy...

http://www.greaterfool.ca/2015/01/15/leadership-2/

I really enjoy Turner's blog, although his ideas are threatening to some. Last week he wrote about his personal situation:

In this same hood of Toronto, I live in a $2 million house. It’s a short walk to the Yonge subway, a 20-minute drive to the financial core, where my day job happens, and sits on a leafy, quiet street where every driveway has a Mercedes parked outside of two-story brick houses on substantial lots. To buy a house on this street costs at least $60,000 in land transfer tax alone. To sell costs about $100,000 in commission. The property taxes average $700 a month.

So, I rent, although I’m fortunate enough to be able to buy this house with cash. That costs me $3,800 a month. Last year the cash I did not spend buying the house generated a return of 10.3%, or just over $206,000. In the last 24 months there has been zero appreciation in the price of houses in this area. You do the math. I rent this house (granite, stainless, three bedrooms, two baths, garage, three levels, fireplace, hardwood etc.) for 2.2% of its value annually. My investments make five times that. I pay no property tax, building insurance or maintenance. And the guy a few doors away, who lost his executive job just before Christmas, envies me deeply. He will be trying to sell into an uncertain market. He has no choice.

So, on my street, I’m no second-class citizen. I have freedom, mobility and choice and yet live in an equal home, with less financial exposure and obligation. I have a dog. Big. Hairy. He has a backyard, and never asks me if we rent. I pay no city levy, nothing for water and no Toronto garbage tax. I do not insure the house, just my contents. If mortgage rates rise, I care not. If the local housing market stagnates or declines, there’s no impact. When I decide to leave, there’ll be no listing agent, no open houses, no showings, no sign, no waiting for an elusive buyer, no negotiation or sign-backs, no delay, no commission, no lawyer, no stress.

Of course, I know my choices are not reasonable for everyone. But they are for me. The significant amount of money I save not owning this inflated Toronto house has allowed me to....

[inchman]

And the house only has to go up 5% for the same after-tax gain. He says it didn't but the TREB says differently.

... and if Garth's landlord decides he wants to sell or not renew the lease, he gives 1 month's notice and Garth has to scurry around looking for another home, uprooting his family if he has one and incurring all of the moving costs ($50,000 min) on somebody else's whim. Stability is worth something to some of us.

If he stays in that house for 10 years, he will spend well over half a million just in rent. He still needs insurance on his own property, which is often more than house insurance. He says he will make a million in that time based on his ROI but both housing and the stock market tend to average about 6% and I'd rather have my 6% in tax free money.

He could also have gotten an investment loan backed by his home equity, writing off the interest, and made almost the same profit on his investments.... getting 6% out of his house and 4.5% net out of the stock market.

And while housing markets sometimes stagnate(in Canada... different story in the US), stock markets crash . Had he had his money in the stock market in 1999 he probably would have lost half of his 2 million bucks. And if he had oil in the last 2 months....

Timing is everything.

Garth doesn't say if his return is before or after costs.

Garth tends to put things into the "look how smart my choices were".

Easy to do in retrospect. But I'm not convinced that even this was truly a good thing.

The guy who is renting the house to him is probably re-mortgaging every year based on an increasing value and walking away with investable tax free money. Yeah... he'll have to pay tax on it when he sells the house, but in the meantime, he takes capital gains tax free.

[mrlupin]

[mrlupin]

One has to wonder how long the economy can maintain growth essentially on credit.

Even the Conservatives appear rattled. Pushing the budget to April to get a better idea of what's up ahead...

[inchman]

Comparing debt to disposable income is not a valid comparison.

For example.... I've been saving for the down payment for a house for a few years. I take home $2000 per month and spend $1000 on rent. My disposable income is $1000. Then I go out and buy a $200,000 house with the $50,000 down that I have saved, and will be spending $1000 on my mortgage payments. My disposable income is still $1000 but my debt just went from $0 to $150,000. Is that a bad thing? If we subscribe to the implication of this graph, it is.

I'm not saying that we don't depend too much on credit but a more valid comparison would be debt to equity. Another valid comparison is Total Debt Service Ratio... the ratio of debt service to income. Or, what would the graph look like if interest rates went to 6%.

In fact, this graph shows that Canadians are quite capable of handling their debt. Even with increasing debt commitments, Canadians' disposable income (left over after debt commitments) is increasing. That means that they are able to stay ahead of payments. If the disposable income was flat or decreasing, that would be scary. It could change quickly if interest rates suddenly rose and I think that is the greatest danger, but certainly not in the next couple of years. And the biggest losers would be the banks themselves, apparently.

I could see a small rise (maybe 1%) in the next year or so to cover the dollar, to avoid inflation, but not much more than that.

The significant increase in Line of Credit is at least partly due to a tendency for people to use a line of credit for part of their mortgage, an excellent debt management strategy.

The last major housing bubble burst in Canada (in about 1990) was during a period of high inflation, increasing interest rates and high and increasing unemployment.

[DEFCON]

Funny thing, this economic stuff.

When I went to high-school we were told to save our money, avoid impulse buying at all costs and do everything you can do to avoid getting caught up in the credit / interest vortex.

Then came Bretton-Woods and fiat currency.

Nowadays, the high-school kids are being advised the most important thing they can do is establish and maintain a 'credit rating'?

What advice do you provide to your kids?

[Kip Powick]

Your second sentence.

All three have done so.....married...kids....each only have a mortgage to carry and all three paying it off as soon as possible.

[Don Hudson]

The thread is certainly worth reading as it urges one to examine one's personal financial affairs and offer discussion points for one's adult children.

The first rule of such discussions is, "Times are always turbulent". We are always between boom-and-bust cycles; the political economy has not been stable, predictable or reliable in anyone's lifetime here! No need for hard-hats unless one is high up in the superstructure and way out on a beam; - just moderation and an ear to the rail.

The second rule is, when asking for or listening to "advice", one must be aware of the advisor's biases, values, motivations and world-view because the two, (views/advice) are unavoidably, inextricably intertwined.

I can't get excited about excited bloggers and their equally-excited critics. I don't think excitement is helpful to thinking. I like Mark Carney - so did the Brits. I think David Stockman is worth reading, ("The Great Deformation", Washington Post review). He's a better writer than Mr. Turner and more prescient.

Over the years lot of books have been sold predicting this disaster or collapse and otherwise portraying general gloom and doom. Such books about imminent, disastrous financial losses apparently make the authors a lot of money. Today, it's bloggers and there are many - the agreements and disagreements are worth reading but one must keep one's perspective and not listen to the Sirens, particularly if one's long-term approach to such matters has been working. I think it takes a unique, even rare set of skills to do well in what is, for many, a "casino" economy in which tea-leaves may serve as well as the many investment advice books available. But lower expectations, reduced obligations and manageable debt kept in moderation according to one's worth and one's income means that one can do reasonably well without spending 24/7 babysitting the portfolio homonculus or sweating the small stuff.

ed to add...Kip, re "pay it off"...

My one prediction is that pensions, which are at the moment passé, will return as the result of the present destruction of organized pension plans and the downloading of same to individual employees having run it's course as those who have no pensions and didn't plan or have the skills or more likely the income to create one for themselves begin to retire in what are (real-but-not-sexy-when-it-comes-to-selling-advice), disastrous financial straits.

In such circumstances one grows accustomed to paying attention to those who seem to know what they're doing AND who also have nothing to sell such as books, ideas, reputations or products. Such typically-unsung persons also tend to having a proven track record. I'm reading through Mr. Turner's blog. The notions are familiar - so far the world hasn't ended, but I haven't reached 2009 yet. I like some of Mr. Turner's views and in particular his maverick history but he leaves me wondering about some things and so doesn't fit in that category of proven track records for me. He is certainly entertaining though.

I like moderated views which don't rely upon bold statements concerning this boom or that disaster to sustain the argument or feed a blog. The results so far have been satisfactory.

One question I have for anyone...I was under the perhaps-mistaken impression that what was done in the United States by unethical financial houses and which was the source of the "sub-prime" real-estate crash in the early 2000s and beyond, was illegal in Canada. The crash-of-Canadian-real-estate motif having been continously touted since about 2006 and regarding Mr. Turner's recurring claim, (having been around long enough that it can no longer qualify as a "prediction"), that there has existed for years a "sub-prime mortgage" bomb that is about to go off at any moment - is there one? - just like the United States? Are the same "sub-prime" dynamics at work in Canada as the ones legalized in the U.S. and which in part brought us "2008"? I think that while entertaining us he is playing with ideas and words intended to grab attention - it is difficult to sift through the following words and take substantive meaning:

"Does Canada have a subprime mortgage problem? You know, Oakies buying McMansions? Loans for fogging a mirror? You bet your beaver we do. In fact, those profligate Yanks have nothing on us when it comes to taking a perfectly useful asset like a home and turning it into a pile of casino chips."
http://www.greaterfool.ca/2012/02/20/canadian-subprime/

I'm certainly aware of the debt issues, (particularly reverse-mortgaging of paid-off houses and, in my view, the increasingly-prolific financial businesses which offer such, - in my view, immoral - , "services" to the unwary and financially-strapped), as described by the present Governor of the Bank of Canada but I ask because we in Vancouver are in a "cooling off" at the moment - it is, (relatively speaking) a "buyer's market". We've seen numerous "rationalizations" of the real estate market since 2008 but no, "Pop!"...yet!

[Boney]

I think the issue in Canada is the amount of debt each of us carry, which is based on low interest rate. Once interest rate starts rising, looks like we have a pause for another year, then it becomes interesting.

The current housing rollback has more to do with the low oil price. Provinces that depend on oil provinces, like Alberta, will get a reality check when they slow down for a year. The lack of or reduce transfer payments will cause local governments to increase taxes & fees, even though they know it will hurt them in the long run. There are times when running a deficit is warranted, as long as it's for a short term.

My wife and I tend to live on a frugal mode. It becomes a question of needs & wants. We do acquire wants every so often, but the majority of times its "do we need it or want it".

Cheers

[inchman]

Now Garth is even making up his own definitions:

Garth:“Subprime” simply means lending to people who would not qualify under traditional guidelines.

He then goes on to describe how borrowers needed to have 25% down and that the change to 10%, then 5% took them out of traditional, and into "subprime", territory.

Investopedia: "Subprime":A classification of borrowers with a tarnished or limited credit history.

Of course, it was folly for US banks to lend to Subprime borrowers. But just because someone doesn't have 25% down,it doesn't mean that they have a tarnished or limited credit history. Maybe their money is tied up in stocks or bonds or all of the other things that Garth suggests are good investments, but they want the stability of owning their own home. Forget 5% down... US banks were lending 120% of the value of a home to people so they could go out and buy the 25 foot boat to put in the driveway. And they let them pay off their mortgages over 40 years (not really "paying off" anything). Then the took those loans and packaged them into "prime" investments by including a bit of good stuff, then they lent up to 9 times more money than they even had on deposit. Then they started lending each other money so they would have more on deposit and could lend up to 9 times of that!

And the US government kept their hands off. They knew their economy was going in the tank anyway because they had been shipping all of their manufacturing overseas.

On the other hand, the Canadian government wisely increased the 5% number to 10% for condos last year, in an attempt to cool a market that was, apparently, overheated. And they canceled 30 year mortgages unless you have 20% down.

Frankly, between Paul Martin and Jim Flaherty, we were very lucky to have such insightful minds at the top. The banks were screaming for US style banking and Martin (and Chretien) said "NO".

The fact is that the rate of mortgage delinquency in Canada {is at its lowest since 1991} (This is in error... there was a period between 2003 and 2008 when it was lower... but 5%-down mortgages were available then, too). So, clearly, people can have un-tarnished credit ratings while holding 5 and 10% equity mortgages and the program is a success. If we forced people to wait until they had 25% down, instead of one of the best economies in the world right now, we would be one of the worst of the G20. The number of jobs created by allowing people to buy homes instead of rent apartments is huge.

There will always be cooling off periods as purchasers lose interest in buying at very high prices and that's a good thing. A market bubble "burst" will only happen when people have to sell or dump their properties. That would be set off by a large increase in interest rates or unemployment. High prices just level off, or decline slightly for a while till demand increases again.

For Garth to suggest that Canadians "invented" subprime is just more grandstanding.

[MD2]

Subprime I believe had more to do with corporate greed of U.S banks that wanted to lend money at any cost and then sell the bundled mortgages to third parties. If proper checks and balances are in place, there is nothing wrong with 5% down and buying a home as long as there is enough cash flow to support the payments. Many families have become home owners like this. It also has to do with responsible bank policies that keep speculation to a minimum. This was the reason for high interest rates in the 80s which resulted in foreclosures and then a severe decline in prices. Speaking of which, some people have been speculating on rising interest rates in Canada and elsewhere for years, but I doubt that the economy could support it and the banks, especially Canadian ones, are doing very well as it is. The high interest rates of 80s are not likely to return any time soon if at all.

[Don Hudson]

The banks were screaming for US style banking and Martin (and Chretien) said "NO".

I remember that really well - (the same PM said "NO" to Bush when the war-mongering, lying team invaded Iraq but for most that's down the memory hole now!)

The interest rate issue is, of course, an administrative and policy trap - in fact, like oil it is now a societal "addiction". Raising rates by a substantial amount, (say 2%) over the short term would kill the economy of the west for simple reasons...very few households here, south of us and in Europe have the capacity to absorb both that and to continue circulating cash by continuing to spend. Then our economy would truly be in the hands who ship their wealth off-shore to tax-protected havens or corporations who remain under-taxed when it comes to the benefits of publicly-funded infrastructures.

Regarding Mr Turner and the many others who do so, "self-promotion" is the antithesis of good advice.

ed to add: MD2, re "If proper checks and balances are in place, there is nothing wrong with 5% down and buying a home as long as there is enough cash flow to support the payments." - Precisely - that is a definition of stability. In contrast to more stable economies such as ours and the Australians' the United States' regulators have been beaten into the corner of deregulation by Reaganites and those who followed Reagan/Thatcher including Mr. Clinton. They permitted and even encouraged a free-wheeling approach to their economy, encouraging it to be run by the greedy, not the smart.

[mrlupin]

First the conservatives delay the budget, now the Bank of Canada drops it's overnight lending rate... Dollar further.

Interesting times. I wonder what comes next?

[Trader]

The US mortgage companies (less so banks) before their crash were handing out mortgages like candly. There was a huge percentage of those that were called 'no doc' mortgages - no documentation or proof required! Many loans also had teaser rates that rose after 1 or 2 years to a point where they were unaffordable to the client but the brokers didn't care nor did the banks. They bundled those mortgages in securities and sold them on.

Teh Canadian example was/is different but there are parallels. At one point there was a 30/35 mortgage available and approved by the feds. All our banks were offering 'cash back' or similar deals where you would put 5% down and once closed get a lump sum back.

The reason the feds pulled the 35 year mortgage (and quashed talk of a 40 year) was because they realized what happened in the US could, to some degree, happen in Canada. The BIG difference is that the banks and mortgage companies in Canada are not on the hook due to CMHC-- the TAXPAYER i

[inchman]

7. Who pays for the CMHC Mortgage Loan Insurance?

Like any other kind of insurance, there are premiums to be paid. The lender typically passes on the cost of insurance to the borrower. The premiums can be paid up front in a lump sum or blended in with your mortgage loan payments.

CMHC manages its mortgage insurance activities through sound business practices that ensure commercial viability even in less favourable economic times. Consistent with the directions set by the office of the Superintendent of Financial Institutions for private sector insurers, CMHC maintains sufficient reserves to meet anticipated future claims.

Banks are not on the hook because the home buyer pays mortgage insurance premiums and these are managed by the CMHC. Between the premiums, the 5%-10% down, plus any principal that is paid down by the time the home goes into default, it would be pretty hard for them to go into the hole.

I suppose, that, if there was a huge run, the CMHC might have some issues, but it's not like they have to come up with the full balance on the mortgage... they take over title to the home and resell it. Even in the 80s, when there was lots of defaults, I don't think the taxpayer had to pay the banks anything on defaulted mortgages. CMHC properties often sell before other homes because they pay all but one percent of the real estate commission to the selling broker.

[UpperDeck]

No one has remarked upon the impact of demographics and an aging population.

Forget debt for a moment and consider the plight of those living off of the income from investments.

At a 4% return one is not living high on the million accumulated over a 30 year career.

If rates were increased to 7% ---very low by 1982 standards----the "elder" segment would have a lot more disposable income all of which goes directly into the economy and not through prior sticky institutional fingers.

I believe---with little evidence---that low interest rates has restricted growth and Japan stands as an example.

More borrowing doesn't equate to greater discretionary spending.

[Trader]

inchman - I agree, the CMHC could most probably sustain a large downturn. But the fact that the Feds pulled back from allowing longer term mortgages, stopped insuring homes over $1 million, forced banks to stop offering 'teaser' cash back options, restricted the home equity loans along with a host of other changes demonstrates that they are concerned, to some degree, about an overheated housing market. The banks don't really care since they don't hold the bag for a default. So they continue trying to push mortgages.

The large increase in home equity loans is a good example of how Canadians are taking cash from an asset to fund their lifestyle.

Canadian personal debt is at record levels and wage growth is stagnant. The math on that is easy - at some point they will have to reign in spending and increase saving/debt payment.

Upperdeck - that will become an even larger issue as people move into retirement WITHOUT good pension plans. I'll try and find the stat but I believe in the last few years over 20% of retirees still had a mortgage. Add to that the increase in lifespan and other factors and funding retirement is going to be a problem for a large number of people. Gov't don't really want to acknowledge it but their are some big name - Ray Dalio etc who have been speaking of this issue over the last few years. Most people are ill equipped to plan their retirement or blind to it.

[inchman]

No one has remarked upon the impact of demographics and an aging population.

Forget debt for a moment and consider the plight of those living off of the income from investments.

At a 4% return one is not living high on the million accumulated over a 30 year career.

If rates were increased to 7% ---very low by 1982 standards----the "elder" segment would have a lot more disposable income all of which goes directly into the economy and not through prior sticky institutional fingers.

I believe---with little evidence---that low interest rates has restricted growth and Japan stands as an example.

More borrowing doesn't equate to greater discretionary spending.

I agree that an aging population is an issue.

The problem of high interest rates to ensure a better return for those people is that if a large segment of the population is getting 7% on their money, that money has to come from somewhere. If it is laid on the shoulders of our offspring (who else?), they will have to spend more of their disposable income on interest expense to provide return for their parents (after the banks take their cut). And if rates go up, it will reduce prices for those who have not yet bought a home, but those who already have a mortgage will come under significant pressure. To provide people with 7% return, theoretically, fixed mortgage rates (which are more based more on bonds than the Bank of Canada overnight bank rate) have to be higher than that, more than doubling people's payments on their next renewal. Those with variable rates or large amounts in lines of credit would feel the increase in cost almost immediately.

And if, as Trader says, people are heading into retirement with mortgages and underfunded RRSPs, higher rates won't help increase their spending, either. If those people were counting on using their homes to fund their retirement, either through a reverse mortgage or by selling their home, higher rates will give them more on their $300,000 RRSP but have a much more dramatic negative effect on the price of their $800,000 home. If a buyer can afford ~$2800 per month for their mortgage, an increase from 3% to 6% just reduced the affordability of every home that they might look at by $150,000. That means that that $800,000 home is now worth $650k. And, if they still have a $200,000 mortgage, their costs just went up by $6,000 per year

So, while this increase would give the retiree an extra $9,000 (taxable) per year on their RRSP return, their nest egg just went down in value by $150k and their costs just went up by $6,000 (after tax) until they unload it.

I agree, Trader, that the cooling measures taken were because of what was becoming an overheated market and there is no question that prices will probably level out in many areas, and maybe recede a bit. I just don't see a nation wide textbook bubble burst... probably a bit of a pop in Calgary, Edmonton, and almost certainly in Ft. Mac. Maybe in some other regions that are heavily invested to supply the oil business... how big is the town where Provost buses are made? There will be some people in those areas will have to sell and unemployment is going to be higher. This creates both higher supply and lower demand which is obviously going to affect prices dramatically. Will it affect other areas that are more diverse and less dependent on the oil business? Probably not. Interest rates are still the biggest factor, IMO.

So, we have some regional unemployment and regional lack of demand but, as long as interest rates stay low, there won't be a huge run on housing, IMO. All the more reason for the government to keep rates low and that looks like it's happening. Not much room left at this point, though. If this small cut doesn't work to stem a downturn, as the US and Europe has found, it may eventually be necessary to issue bonds to create more money. Hope not.

[Don Hudson]

Trader, re, "Upperdeck - that will become an even larger issue as people move into retirement WITHOUT good pension plans. I'll try and find the stat but I believe in the last few years over 20% of retirees still had a mortgage. Add to that the increase in lifespan and other factors and funding retirement is going to be a problem for a large number of people. Gov't don't really want to acknowledge it but their are some big name - Ray Dalio etc who have been speaking of this issue over the last few years. Most people are ill equipped to plan their retirement or blind to it."

From June, 2003 I wrote:

The "pension crisis" isn't a crisis which employees had a hand in. Employers, companies, organizations don't want to set aside the huge amounts of money needed to provide for decent employee pensions anymore and so are downloading those responsibilities onto the employees through "defined-contribution" plans. Pension "holidays" are taken, and the money that should be going into long-term funds, goes to daily operations.

Handing over pension responsibilities to employees is fine as long as the market does well and as long as employees can contribute reasonable amounts to their own pensions, but RRSP (registered retirement pension plan - tax-deductible contributions) limits are still severly restricted at least in Canada, ($13000CAD approx per year). http://theairlinewebsite.com/topic/8512-how-i-sometimes-wish-for-good-ol-values/#entry29440

What corporations have done since then is to cease DB plans, turning to DC plans, (which I argued strongly against when first discussed a dozen years ago), or if there is no pension plan for an employee, corporations tacitly rely upon insurance companies and the public purse to "fund" retirements either through public pension plans or in worst-cases, through "wards-of-the-state" planning. After a dozen years of this I still do not know anyone who has become sufficiently expert at investing and who is making sufficient money to both put money into a retirement plan and build it into say a four or five million-dollar fund from which one draws say, 3 or 4%, (which is the amount recommended by most).

I believe that one reason people are using their homes as collateral for lines of credit for spending is for this very reason...no, or little pension funding, and of course this works so long as "the asset" (whether the stock market or the housing market) is able to support such responses.

Interestingly, the NHL has dumped their DC plan and returned to a DB plan...Good move, in my opinion.

“We wanted to make sure that we were prepared for life after hockey,” says Colin Greening, left wing for the Ottawa Senators and a pension trustee with the NHLPA. The new pension plan took effect early last year as part of the collective bargaining agreement following months of lockout.

Greening says the players made the DB plan a priority during negotiations because, despite their young ages, they understood its value. “During the negotiation process, we had guys who were 18, 19 years old, who were looking at the long-term advantages of a DB plan,” he explains. “It’s not a common topic to talk about when you are 18 or 19.”

The NHL had a DB arrangement years ago but switched to a DC plan in 1986 as part of a collective bargaining agreement. The DC plan, administered by Sun Life Financial, is now frozen and all new entrants enrol in the DB plan.

In exchange for the new DB plan, the players agreed to a smaller share of the league’s revenue—50%, down from 57% under the previous agreement, explains Jessica Berman, vice-president and deputy general counsel for the NHL.

“Money that would have gone to salaries went to pensions instead,” says Alex Dagg, the NHLPA’s director of operations.

http://www.benefitscanada.com/pensions/db/strategy-the-puck-stops-here-57612

[DEFCON]

Trader

"I'll try and find the stat but I believe in the last few years over 20% of retirees still had a mortgage."

Is this the historical norm, or the product of the high divorce rate amongst couples?

[Trader]

Defcon- that's a good question. I don't think it is the historical norm but the fact that more people are spending more than they earn or spending instead of saving.

[DEFCON]

Last week the media reported that over 50% of the worlds measurable wealth is now in the increasingly larger holdings of the 1% gang. Is it fair to conclude then that a big part of our problems are directly related to the reduction of available cash as it leaves circulation and gets tucked away in the holdings of the 1%ers? The obscene profits reported by banks over the past decade and a half are an example of this transfer of funds to the pockets of the very few. In spite of the low money supply, interest rates remain suppressed, perhaps intentionally, which increases debt and the likelihood ever greater numbers of people will end up in servitude to the banks and their owners in perpetuity?

[DEFCON]

Thanks Trader.

[UpperDeck]

In my working life the current rates are significantly lower than "we" ever anticipated. I remember thinking 18% was a deal on my mortgage.

Developers value land based on the market value of the homes to be built factoring in servicing costs etc.

Municipalities think they increase affordability by increasing density---from 50' frontage to 40' down to 25'---and within a very short period any savings are lost as the raw land value rises to reflect the increase in homes that can be built and sold.

I don't agree that youth is "burdened" by normal interest rates. Market value is a reflection of many factors including availability of money. There is always some degree of levelling to restore equity to the marketplace.

[Kip Powick]

I know this is a very simplistic view of the entire problem but, in relation to the younger generation(s) I do believe it is adding discourse to the current situation..

CAUTION.......VERY STRONG LANGUAGE....