- Joined
- Aug 30, 2007
- Messages
- 13,879
I think it is the realization that a) democratically elected officials cannot protect the average person as previously assumed and b) that Wall Street and its extension does not provide meaningful benefits for investors anymore.
People across the developed world are starting to realize that the welfare state, the reliance on public healthcare, clean financial markets, safe investments, guaranteed pensions or the dream of Freedom 65 is seriously eroding ! The `state` is not all powerful, will have far less resources going forward, is over-indebted and will give us far less benefits we hoped for.
I too was enraged this weekend at the stock market collapse, the UK riots, the Greek riots, and all the capitalistic greed that caused so much money to disappear not only in the stock market, but also from real estate investments such as Shire, Concrete Equities, Signature Capital, Libertygate and the increased difficulty we now face to raise money into our fairly safe and still quite lucrative investments due to these failures but also due to recent changes in the exempt market.
To the second point, read this blog post by Mark Cuban, the billionaire owner of the Dallas Mavericks, on `What business is Wall Street in`. The ONLY parties that make money in the financial industry are traders and banks, trading on extreme volatility. With several billions shares traded over the last few days of extreme volatility alone, with no transaction tax, there is no benefit to investors nor governments, only to trading houses. Why does the BC or ON government charge a 2% real estate transfer tax, but no share transfer tax ? Surely, that would be one good way to encourage stock ownership for more than a few seconds, to reduce volatility and to boost Ontario`s, Ottawa`s or Washington`s empty coffers. Additionally, banks can borrow money at next to nothing and buy treasuries with a 1% (or 100% profit) uplift or lend it to homeowners for 3.5 to 4%. Why risk lending to a job creating small businesses such as a software start-up, a manufacturing or bio-chemical firm, or for a real estate land deals, if a bank can make money almost risk free. No wonder so little jobs get created in North-America anymore.
The financial industry is systemically flawed ... as evidenced by the Dow Jones Index which has been essentially flat for TEN YEARS .. from around 9,000 to now around 11,000 .. a 20% total return on the index and that is before mutual fund fees of 2% or so per year. Thus: ZERO return if you had followed your `advisor` recommendation of buy and hold mutual funds. Marginally better on the TSX where you could have eked out a 40% ROI in 10 years in a pure stock index .. minus 2.5%/year in mutual fund fees for a net return of around 15% in ten years. So that is the new reality: 2-3% in stocks .. and 1-2% in mutual funds! No wonder your RRSP performance has been so dismal in 10 years. If it has exceeded 5%/year for 8+ years please send me an e-mail. Don`t believe in all this 7-9% per year return stuff if you`re invested in the stock market. Your financial `advisor` is making money, your stock brokerage firm is making real good money, your bank is making money, but you do not. But hey, 3 out of 4 ain`t so bad ! Why change it ??
Well, you have a choice: continue down that same insane path of `investment` or try another path. Why not co-own some residential land or income producing real estate in one of the most advanced and prosperous parts of the world, namely W-Canada. We have what the world wants: oil, gas, coal, wind, water, uranium, potash, agricultural land, clean air, space, scenic beauty, less crowds, low debt, low deficits. W-Canada has high levels of in-migration due to very strong job growth. Our rents in Calgary and Edmonton are going up, and so are buildings values. After only 2-4 years of ownership we have sold a portfolio of 4 buildings in Yorkton, SK at an enormous profit. This deal went unconditional last week with a triple digit return on the cash invested !
We know many opportunities exist - as we see them every day - in the right markets, such as most cities in Alberta, for apartment buildings, land held for development or for select construction projects. These projects produce far higher returns than the stock market as they are well selected, impeccably managed and its values skilfully amplified.
Again, if your RRSP hasn`t delivered 50% in 5 years or 100% in 10 you ought to consider a change, not just of `advisors` but of investment class also !
People across the developed world are starting to realize that the welfare state, the reliance on public healthcare, clean financial markets, safe investments, guaranteed pensions or the dream of Freedom 65 is seriously eroding ! The `state` is not all powerful, will have far less resources going forward, is over-indebted and will give us far less benefits we hoped for.
I too was enraged this weekend at the stock market collapse, the UK riots, the Greek riots, and all the capitalistic greed that caused so much money to disappear not only in the stock market, but also from real estate investments such as Shire, Concrete Equities, Signature Capital, Libertygate and the increased difficulty we now face to raise money into our fairly safe and still quite lucrative investments due to these failures but also due to recent changes in the exempt market.
To the second point, read this blog post by Mark Cuban, the billionaire owner of the Dallas Mavericks, on `What business is Wall Street in`. The ONLY parties that make money in the financial industry are traders and banks, trading on extreme volatility. With several billions shares traded over the last few days of extreme volatility alone, with no transaction tax, there is no benefit to investors nor governments, only to trading houses. Why does the BC or ON government charge a 2% real estate transfer tax, but no share transfer tax ? Surely, that would be one good way to encourage stock ownership for more than a few seconds, to reduce volatility and to boost Ontario`s, Ottawa`s or Washington`s empty coffers. Additionally, banks can borrow money at next to nothing and buy treasuries with a 1% (or 100% profit) uplift or lend it to homeowners for 3.5 to 4%. Why risk lending to a job creating small businesses such as a software start-up, a manufacturing or bio-chemical firm, or for a real estate land deals, if a bank can make money almost risk free. No wonder so little jobs get created in North-America anymore.
The financial industry is systemically flawed ... as evidenced by the Dow Jones Index which has been essentially flat for TEN YEARS .. from around 9,000 to now around 11,000 .. a 20% total return on the index and that is before mutual fund fees of 2% or so per year. Thus: ZERO return if you had followed your `advisor` recommendation of buy and hold mutual funds. Marginally better on the TSX where you could have eked out a 40% ROI in 10 years in a pure stock index .. minus 2.5%/year in mutual fund fees for a net return of around 15% in ten years. So that is the new reality: 2-3% in stocks .. and 1-2% in mutual funds! No wonder your RRSP performance has been so dismal in 10 years. If it has exceeded 5%/year for 8+ years please send me an e-mail. Don`t believe in all this 7-9% per year return stuff if you`re invested in the stock market. Your financial `advisor` is making money, your stock brokerage firm is making real good money, your bank is making money, but you do not. But hey, 3 out of 4 ain`t so bad ! Why change it ??
Well, you have a choice: continue down that same insane path of `investment` or try another path. Why not co-own some residential land or income producing real estate in one of the most advanced and prosperous parts of the world, namely W-Canada. We have what the world wants: oil, gas, coal, wind, water, uranium, potash, agricultural land, clean air, space, scenic beauty, less crowds, low debt, low deficits. W-Canada has high levels of in-migration due to very strong job growth. Our rents in Calgary and Edmonton are going up, and so are buildings values. After only 2-4 years of ownership we have sold a portfolio of 4 buildings in Yorkton, SK at an enormous profit. This deal went unconditional last week with a triple digit return on the cash invested !
We know many opportunities exist - as we see them every day - in the right markets, such as most cities in Alberta, for apartment buildings, land held for development or for select construction projects. These projects produce far higher returns than the stock market as they are well selected, impeccably managed and its values skilfully amplified.
Again, if your RRSP hasn`t delivered 50% in 5 years or 100% in 10 you ought to consider a change, not just of `advisors` but of investment class also !
