I was reading a very interesting article in the Bloomberg Businessweek†“Chowing Down on Boomers’ Brains“, which talks about the huge loss of “tribal knowledge” with the retirement of the Baby Boomers from the workforce,… Read More »Financial Knowledge Draining Away
If you were feeling optimistic about life and such, remember the Doomsday Clock is still set at 3 minutes to Midnight (where Midnight is the Big Casino for humanity). The Bulletin of Atomic Scientists site many things that are going on in the world that should have us worried, but surprisingly the sales of bomb shelters have not increased (unless you count some of the Condos in Toronto?). It sounds like the explosion of the Housing Bubble is not the only Big Bang we should worry about.
Evidently, RBC has some explaining to do as they seem to have sent out incorrect RRSP receipts to the wrong customers, which is an interesting double negative. Not only was the information incorrect on the receipt, it was sent to the wrong person with information from other folks (Social Insurance Numbers and the like)? That is what I call getting it as wrong as possible, but, I am confident there are worse examples.
Will legalized marijuana sales become a cash crop for our government? A lot of folks think so, but I am skeptical. The number of money folks seems to think legalized pot will create are optimistic, but IÂ will be pleasantly buzzed if the prognostications are correct. Pass the Doritos, please.
Winterlude has come to Ottawa, so everything has started melting (keeping with the Ottawa tradition). We should rename Winter, Winterlude and we could save a fortune on snow removal.
Marijuana may not be a huge cash crop, but Cauliflower sure seems to be a wallet buster these days in terms of prices, as we saw in Food Prices up 4.1% for 2015
Was I making up this whole Bimodal Financial Planning thing? Kind of, I was mostly stealing a concept that the Gartner Group is espousing for Information Technology groups, but I feel it might catch on in the financial world was well.
Are you following this version of Stats Canada? You should:
Bimodal financial planning is the new rage in the financial world, where you attempt to build wealth while paying down debt.
The year 2015 ended with food prices going up, and causing consternation on the wallets of Canadians.
The Bank of Canada on Wednesday held the line, in terms of their key overnight interest rate, and neither raised nor lowered it. Lowering the interest rate would have triggered a significant drop in the value of the Canadian dollar, but it would have provided a much-needed boost to the economy. On the other hand, raising the overnight rate would have protected the value of the Canadian dollar, but it would have created chaos in the real estate market. By choosing to remain inactive, the Bank of Canada may imply that it does not see the need for further stimulation or protection of the Canadian dollar.
In their own words:
All things considered, therefore, the risks to the profile for inflation are roughly balanced. Meanwhile, financial vulnerabilities continue to edge higher, as expected. The Bank’s Governing Council judges that the current stance of monetary policy is appropriate, and the target for the overnight rate remains at 1/2 per cent.
For now, we are OK? Maybe.
Another distressing statement from the Parliamentary Budget Office (PBO) about Household Indebtedness and Financial Vulnerability, and we are more in debt than most G7 nations, which upsets the PBO (and the financial media in general).
In their words:
Based on PBO’s November 2015 Economic and Fiscal Outlook, we project that household debt will continue to rise, reaching 174 per cent of disposable income in late 2016, before returning close to current levels by the end of 2020….Household debt-servicing capacity will become stretched further as interest rates rise to “normal†levels over the next five years. By the end of 2020, the total household DSR, that is principal plus interest, is projected to increase from 14.1 per cent of disposable income in the third quarter of 2015 to 15.9 per cent.
So the world of family debt is going to get worse before it gets better, and it better get better soon because interest rates are going to rise one day.
Finally, the Loonie is below 70 cents US and showing no strength either. Could this mean spirally prices for imported stuff? We already have the great Cauliflower Calamity of 2016 (where it costs anywhere from $5 to $8 ahead). Inflation will most likely be low for a little while in reaction to very low gas prices, but the weak loonie may spark higher inflation, thus higher interest rates might be sooner than we think.
If I was a musician over the age of 60 I’d be worried, 2016 looks like a bad year for the Stock Market, and Musicians.
Winter may be here, but there is no canal skating going on yet in Ottawa, maybe soon:
I was a dirty skunk with my post Optimize Your Budget for Any Debt Level, where I tricked unsuspecting readers into reading my sure-fire way to optimize their budgets (yes I am going to hell for that one):
I hear that 55 is the new 40? I am not buying into that, because I could still run at 40, but I do write about my advancing age in Now I’m Fifty Five, nothing too exciting yet, but very close to retirement.
Thanks for reminding us Mr. Mercer
