Implications for Canada of US Nov. 6 Election results: bridge from Michigan, stronger Can $ currency and less grow-ops in BC

[Thomas Beyer]

Nothing changed tonight on the big scale, as the house, the senate and the presidency saw, surprise: no change !



BUT:



In smaller news, Michigan voters turned down the proposal that opposed the Canada-US bridge, so that can go ahead now, good news for Ontario & international trade and further investment in Canada and US on both sides of the border.



Washington state approved casual use of marijuana. This means less grow-opps in BC, and less crime in BC.



The US will continue with a weak economy, a grid locked government, high high deficits and thus, a weak US currency.



This means more money will flow into Canada, strenghtening our $ and with continued sound fiscal management we will outperform Europe and the US by a wide margin due to their weak and worsening balance sheet.



Buying in the US might mean slightly rising prices there, but after taxes on a small gain are factored in the remaining after tax US $s might be lower in Can $s 5 years hence.



Canada: I love thee !!



A great place to invest !



Your thoughts ?

 

[mortgageman]

The status quo will mean Canadian mortgage rates will stay low due to the strong Canadian dollar (the never-ending stimulus measures in the US are devaluing the dollar) and Canada's position in the world as a safe harbour for capital.

 

[RedlineBrett]

I'm definitely happy with the outcome. Romney and the republicans are crazy. Some senators got ousted for good reason as well.



For the most part, when the US does well we do well too. I'm happy for them. Here's hoping that pipeline gets built now.

 

[Thomas Beyer]

[quote user=mortgageman]The status quo will mean Canadian mortgage rates will stay low due to the strong Canadian dollar (the never-ending stimulus measures in the US are devaluing the dollar) and Canada's position in the world as a safe harbour for capital.
Indeed.



Stock market dropped this morning, as one would expect, almost 3%, the biggest drop in a year !



Real estate in Canada, well located & well managed (and sensibly levered) will remain an excellent investment class - better than the volatile stock market.



Easier to raise JV money !!!

 

[TangoWhiskey]

I'm loving the situation right now for Canada but there are still factors worth investigating in the US in the right markets. Hedging then just becomes a cost of doing business and its one I'm willing to add to the already conservative margins I need in a deal to bother going to the next step.



What's the realistic long-term cost of adding hedging to ensure that you get repaid in full value dollars? I'm guessing 3% annually to carry insurance against a long term devaluation of the US dollar. What do you guys think? What would be the most effective way to hedge say a 3 million down payment into a B class 80 unit apt complex in the US? Expected hold being 7+ years.

 

[Thomas Beyer]

No hedging required. Vaue of asset will go up correspondingly. Issue is huge taxes on gain on sale, then repatriation of $s. invest in US$s and do not worry about the exchange rate, and use $s in US for re-investment tax free on rollover or on ultimate exit for vacation home, trips, boats, etc.

 

[Sherilynn]

Makes me want to sing "O Canada."



I am sooooo happy that we moved back to this wonderful country. There is no place better (even with the 8" of wet snow we received today).

 

[Cory Sperle]

Right on Thomas, here are my thoughts





Alberta especially is the place to be right now. I love Canadian history. Those investing now in Alberta are the same as the first few who ascended the golden stairs of the Chilkoot pass in 1896. The 1897 Klondike gold rush is Alberta in 2013 to 2023 on a larger scale. Why?


I have seen with my own eyes over the past 7 years almost every oil sands project in this province. A vast majority of these projects have not produced a drop of bitumen. What is happening up there has only just begun, the miles upon miles of trucks hauling shovels, vessels, and other equipment that blocks the road on HW 63 every day. Even oil sands critic CBC estimates 364 billion worth of activity over the next two decades, and Ontario getting many of the contracts. Stephen Harper touring the arctic this summer to bring to light billions of activity that will hit NWT, Yukon and Nunavut over the coming years, much of it going through Edmonton, the gateway to the north. The ever thawing northwest passage that will soon be clear year round. The American desire to be energy independent with the help of the Keystone. Low Alberta real estate prices compared to anywhere else in Western Canada. A new refinery announcement just today NE of Edmonton, and likely more to come.


Time to pack your supplies and head for the Klondike. The road is hard, cold, and long but once you get there all you have to do is bend over and pick up the gold. I`m going, are you?