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Tighter Money, Best Investment, Go North! and #MoneyTalk

The Bank of Canada went and done it! They raised the overnight rate to its highest rate in 9 years! This is going to ruin the economy! The rate is now at 1.25%, oh my God! Yes, I am being sarcastic about tighter money from the Bank of Canada. Their overview paragraph from the report was quite telling.

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While the economic outlook is expected to warrant higher interest rates over time, some continued monetary policy accommodation will likely be needed to keep the economy operating close to potential and inflation on target. Governing Council will remain cautious in considering future policy adjustments, guided by incoming data in assessing the economy’s sensitivity to interest rates, the evolution of economic capacity, and the dynamics of both wage growth and inflation.

Pay off Debt
Get Out of Debt

Talk about hedging your bets, I guess they are trying not to scare folks? Rates will be going up, but not in the near future, maybe? Does sound like tighter money policies are coming soon.

On the downside, the rate hike has caused all the banks to increase their prime rates, and mortgage rates, which is going to hit us all in the pocketbook. Most of the major banks have raised  their “prime” rate to 3.45% and all mortgage rates have gone up as well.

For those curious, what would be the best investment given these changing times? GICs will start becoming more interesting to folks, but what might be a good investment? Hmm… How about Pay Down Debt! It now has even higher pay backs! What other investment can give you a guaranteed pay back of around 5% (on a mortgage)? On the plus side my guess is GIC Ladders is going to be a popular search on Google very soon.

Bitcoin lost value this week. Why? I have no idea really, but as I type these letters it is worth less than $10,000, but it might have recovered by the time you read this. To say this is a murky investment area is an understatement. Are you thinking of becoming a Bitcoin Miner? Go North young folk (Northern Quebec that is). Hydro Quebec is luring Cryptominers to Northern Quebec with very low electric rates. Evidently Quebec Knows How to use their excess hydro-electric resources, to make money.

My Recent Writings

This week I queried Can I get a Deal from a Chatbot ? Given the use of automated (some might say AI) on-line and social media bots being used for customer service, it is a valid question. I guess you are not likely to get too much from a Bot, although they may offer occasional perks just to keep folks from complaining about the lack of deals.

Micro Blogging on Finance

The importance of keeping your important financial information safe is nicely summed up in the following meme, which is a twist on an old adage.

Read More »Tighter Money, Best Investment, Go North! and #MoneyTalk

Paper Delivery, Bitcoin and #MoneyTalk

I was saddened to read about the demise of the first job for many kids, the paper delivery person. When I was 10 years old I started delivering the Montreal Star, and then I moved to delivering the Montreal Gazette and then I delivered the Sunday New York Times for a while. These jobs taught me discipline, taught me about money and most likely contributed to my torn rotator cuff. With the ever-changing media environment, delivery of papers was going to disappear, but I am still saddened to see it happen.

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Farewell Montreal Star
Juan Rodriguez Driving a Montreal Star Truck

Do you want to know about Bitcoin? There is a great video at the end of this article that will help introduce you to the most over-hyped investing idea since Bre-X (or Nortel)). Did you realize there are over 500 types of Cryptocurrency? If you want to keep up with them, go to 500 coins and check a few of them out. Choice of the week? Etherium !

More Bitcoin interesting news, a Miami Bitcoin Conference has stopped taking Bitcoins as payment due to high fees and problems. You still think investing in this is a good idea after reading that? You might be a die-hard Bitcoin lover.

My Recent Writings

A slower week for me, and I fell back on the old click-bait, flim-flammery title trick with Stock Picks 2018. As most of you know, I am an Index Investor so how can I put out stock picks? For that you must have a read.

Micro Blogging on Finance

A very interesting Tweet, that tweaked my memories of when I was a roaming Co-Op Student. Every 4 months I had to move and that made me a Minimalist. Everything I had, had to fit in the trunk of a Mercury Zephyr (admittedly bigger than most cars today). In an esoteric way moving was good (for me), however, for folks like Squawkfox and this Twitter Handle it is a life wrenching horrible event.

Read More »Paper Delivery, Bitcoin and #MoneyTalk

Polar Vortexes, Minimum Wage and #MoneyTalk

Over the Christmas holiday Ottawa and Southern Ontario were in the grips of the two words Canadians fear worse than Personal Debt and that is Polar Vortex. It was that bone chilling, battery killing and skin burning cold that we expect in Mid-January, but here it was over Christmas. I have lived through this before, but as I said in 2008 when the markets crashed, it doesn’t mean I have to like it.

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My Exact Sentiments for 2018

With the new year comes many new Government initiatives, and in Ontario that means the minimum wage moves to $14 an hour. There are also new rules about sick leave. What will be the impact of these changes? Currently we have one view that says this will make life easier for those working for a minimum wage, and the counter view that 60,000 jobs will be lost due to this pay increase (according to the Bank of Canada). Time will tell whether this change will make things better for employees, but the early returns suggest the employers are not overly pleased with the changes.

My opinion on the increase in costs to small businesses is that it may introduce more automation in many businesses, and we are already seeing this is companies like McDonald’s with their automated ordering system in store. If costs become prohibitive, businesses will adapt and find cheaper ways to do things, or go out of business. Will this help folks who receive minimum wage? My fear is all this will mean is the elimination of many jobs (or the closing of many small businesses), but I hope I am wrong.

An impromptu survey by me, suggests some small businesses are simply passing the extra cost on to their customer base, by raising their fees.

There was a chance that my last pay cheque of the year might be zero, thanks to the Phoenix pay system, luckily, for me, that did not happen.

The good news is that the Rideau Canal is finally open. Unfortunately, it is -20C a high, so not many folks are going to be skating on it!

Stay warm this weekend, and check on your neighbours too.

My Recent Writings

I took a little time off over the holidays, although I did put out a few articles. I did put out my normal Merry Christmas statement for 2017. Christmas can be very commercial, but to me it means a time for family, and a time to remember those who may not be with us any more. Happy New Year 2018 I decided to point out that I have been at this for a while, and linked to as many of the Happy New Year articles I have written and the New Year’s Resolution articles as well. Yes I really have been at this for over 12 years.

I broke one of my rules of writing with Financial Predictions 2018, by publicizing my guesses as to what this year might hold financially. I try not to go for too much click-bait but the devil took the wheel for a while.

Micro Blogging on Finance

Wondering about when you should start saving and planning for Christmas 2018?

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Game of Thrones Financial

Winter, Inflation and Christmas are Here and #MoneyTalk

Christmas is finally here, and we can then unleash the orgy of spending known as Boxing Day/Week/Month! The sales will start on Christmas Eve, and will continue until there is no snow on the ground. Boxing Day sales used to be interesting, when I got money for Christmas, but now, they bore me. Luckily inflation is here as well!

When did giving a car for Christmas become a thing? One year we got a Vic-20 and I thought that was a huge extravagance. I was planning on giving everyone a Bitcoin, but that got a little out of hand a bit too quick.

Winter is here, to quote Game of Thrones. Days will start getting longer in the Norther Hemisphere but still look for the Debt White Walkers, Rising Dragon-fire Interest rates and the Foreclosure Wildlings, which are now loose.

Game of Thrones Financial
The White Walkers Want Your Money

Did you buy bread at Loblaws or those associated stores? They want to pay you $25 because they gouged you by price fixing. Loblawcard.ca was the place to go and register to get your card. I will be donating mine to my local foodbank.

Guess What? Inflation is back on the table. The Consumer Price Index is back at 2.1%, with transportation dragging the index up for November.

Inflation by Category for November 2017

I bet you are asking, what part of the transportation index contributed the most?

The gasoline index contributed the most to the rise in the CPI in every province except for Newfoundland and Labrador, where a lower gasoline price increase was partly attributable to a reduction in the province’s gasoline tax which took effect in June 2017.

Remember how gas was cheap a while ago? Here is confirmation that yes, it is back up for the Holidays! (not that I would be implying price-fixing in Gas prices either).



My Recent Writings

The past few weeks I have spoken with a few folks, and answered some email from people who are getting very discouraged about the DTC policy changes (apparently) at the CRA. With this in mind I wrote Apply for the DTC Please as a reminder that if you don’t apply you will never get the Disability Tax Credit.

Also, at the end of this post is something most of my readers have been waiting for, my top 3 Christmas Music Songs of all time. Yes, I do have a soft Christmassy side too.

Micro Blogging on Finance

Here is a social media post that has Bitcoins, Bankruptcy and if you click the link you have to use Google Translate to read it! That is a festive Tweet in my books.

Read More »Winter, Inflation and Christmas are Here and #MoneyTalk
far in debt

Canadians Owe More , Polar Temps, CPP Survivor Benefits and #MoneyTalk

Stats Canada got out, just in time for your Christmas spending guilt, Distributions of household economic accounts for income, consumption, saving and wealth of Canadian households, 2016. What is it telling you? Canadians Owe More! For every dollar of disposable income, you owe more than you did previously! An interesting tidbit from the report is:

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In 2016, the national average debt-to-disposable-income ratio was 172.1%

Simply stated for every $1 you have to spend you owe $1.72, isn’t that delightful? If you read the report in more detail you will see the real debt-load of lower-income Canadians is horrific (a mind-bending 333.4%). That is very scary if interest rates start going up quickly.

Canadians owe more
Debt-to-disposable-income ratio by household disposable income quintile, 2012 and 2016

If that doesn’t put you into a festive spending spree, good! Time to start figuring out how the heck to get out of the debt trap, so Canadians owe more be a thing of the past.

One more happy thought to consider:

Similar to wealth, the top 20% of income earning Canadian households accounted for 40.9% of total household disposable income.

Top 20% accounts for 40% of the disposable income? They better start spending!!!!

In Ottawa, the snow came down, and then lovely frigid temperatures arrived quickly afterwards, a delightful 1-2 punch. Thursday morning I drove in behind a car with Florida plates. First I wondered, “Who did he or she insult to end up being sent up here?” and then I wondered, “Have they ever heard of snow tires?”. Yes it is Canada, but it doesn’t have to be this cold this soon, does it?

A very interesting policy change for CPP survivor benefits outlined in , New CPP changes give survivors full benefits immediately. Previously this only happened when the survivor got older, but now it seems to be right away? I would be curious to find out what might have triggered this change of heart by the governments ? Someone commented, “It is the right thing to do…”, but that is rarely a driving force for Government Policy Changes.

My Recent Writings

In the summer I visited the Halton County Radial Railway with my family (my son loves trains), and saw a very interesting ad in one of the old TTC trams that turned into this week’s only article, Toronto Housing Bubble ? Yes housing prices have been out of control many times in Toronto, this is not the first time (nor will it be the last). I note no one has left a comment guessing on the possible year that poster was from, c’mon readers!

Micro Blogging on Finance

Glad to hear the CRA is starting to reconsider their policy change on the DTC, we shall see what comes of this.

How about a Bitcoin one? You’ll like this one, it is deep.

Read More »Canadians Owe More , Polar Temps, CPP Survivor Benefits and #MoneyTalk
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