Canadian Dollars On The Forex Markets vs. The Value Of Domestic Canadian Dollar, Why The Canadian Housing Market Will Cause Stagnant Growth – December 30, 2023
Because of the ongoing war on fossil fuels, the direction of the Forex Markets is unclear. Both in the United States and Canada, there are Far-Left Politicians pursuing “Climate Alarmism” economic policies.
Climate alarmism equates to the economy taking a backseat to solve “climate change.” Clearly, the government is incapable of solving “climate change,” so they’ve outsourced their climate change policies to private LOBBYST groups, who claim that with unlimited money and regulations that ward off their fossil fuel competitors, they’ll be able to address climate change.
Whatever, you want to call this modern fascism, it equates to higher OPERATING costs which get passed onto consumers. These self-inflicted economic wounds destroy the housing market because providing and maintaining HOUSING revolves around MAINTENANCE, maintenance revolves around LABOUR, and laborers require a reasonable salary to labor.
Big Government revolves around making LABOUR more expensive, which is what government regulations are in practice. Municipalities all over Canada not only make housing more expensive to build but also make it more expensive to maintain, and by expensive, the LANDLORD of a property is incentivized to IGNORE low-income housing.
Low-income housing equates to tenants skipping rent and running to the government if they feel like the landlord is charging them too much. So, PRICE controls of some sort are often the norm in the Canadian housing market.
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So when you combine PRICE controls and excessive laws and municipal judges who typically side or show sympathy to the tenants, you create perpetually higher rental prices.
Now, when I listen to both Justin Trudeau and Pierre Poilievre(The likely replacement for Trudeau) the words coming out of their mouths appear to be that the FEDERAL government will fix the problem.
I argue that the Federal Government is the problem; first and foremost, municipal fiscal policies don’t appear aligned with immigration targets; if you go to the ground level with a lot of municipal voters, they don’t seem to want more housing nearby where they live.
Most municipal voters are asking their representatives to build housing somewhere else, so when Justin Trudeau and Pierre Poilievre claim they’re going to through FEDERAL dollars at the problem, it appears that they haven’t a clue about voting patterns, demands and what people actually want.
When I look at the demand for housing in Canada, it looks like most voters want the GOVERNMENT to build and maintain housing. Now, I’m saying this is Anarcho-Capitalist; why would I conclude a socialist statement like this?
Well, it’s because nearly 70% of Canadians are indeed socialist. Most Canadians are supporting Pierre Poilievre primarily because Justin Trudeau is INCOMPETENT, not because they’re Conservatives or on the “Right Wing.”
When I write and say that the NDP has helped to grow the Left Wing ideal in Canada, you’d better take it seriously; when I say I’m supporting the People’s Party of Canada, it’s because I see the importance of having more than one Conservative Party.
In the United States, there are the Republicans, The Democrats, and the Third Party, The Libertarian Party. This is why Moderate Democrats in the United States have a higher economic IQ than do Left-wingers in Canada, who I’d argue are probably some of the dumbest left-wingers in the developed world.
If you have no push back, no alternative points of view, you’re ideology will be based on the only political party you’re aware of. A lot of Canadians, namely those on the Left, imagine that we in Canada are smarter than the Americans; I remind you that even in the Democrat States, they haven’t gone as far as to ban guns.
Canadians are CHILDREN; we live in a civilized country, and we can’t trust our fellow citizens with guns. The government can’t control illegal guns, so it sets its targets on law-abiding gun owners for the OPTICS, meaning that Left Wingers in Canada OPENLY have no interest in solving problems.
This all ties into low entrepreneurship levels in Canada per capita to the United States. When you’re not an entrepreneur, you see the self-driven person as an ENEMY, someone who needs to be dragged back into the bucket with the rest of us CRABS, and this translates into VOTING.
So, if I’m an aspiring landlord or real estate entrepreneur and I’m smart enough to do research on the Canadian housing market before diving into it, I will immediately conclude that if I want to create a sustainable income for myself, I should only cater to the AFLUENT.
So, in Canada, there are a lot of Condos where rental housing should be; in Canada, typically, incentives have to be given by the local government if rental housing is built. Also, in Canada, you have a lot of small business people UNWILLING to rent out their basement, house, or condo to anyone for fear of what COULD happen if they do.
Every property owned in Canada has adapted to the reality that the government, local and federal, will. Cater to the MAJORITY, so for example, some Condo owners know they can kick out tenants based on specific criteria laid out by the government, but even that is a complicated process; why put yourself through that as a landlord when the law could change overnight?
I’ve always laughed at the notion of Late Stage Capitalism because CUBA is an example of what happens if the government starts NATIONALIZING entire industries. Behaviors change almost immediately.
If I know in the back of my mind as a business owner that one legal change by the government can DESTROY my entire business, I won’t get into that business. So now more than ever we have a lot of house flippers.
In regards to the FOREX value of the Loonie, the housing market has put Canada in a very bad place, because if, let’s say, the loonie Starts to rise and becomes Cheaper for Canadians to buy things from the United States, well then a lot of businesses dependent on EXPORTS to the United States, will suffer and all the EXISTING price control mechanisms in Canada, will be used against us.
Both Pierre Poilievre and Donald Trump could be the future Prime Minister and President of their respective countries. If you’re unaware, both are involved in Real Estate, and based on my review of the two men, both don’t appear to comprehend the differences between the DOMESTIC value of their currencies and the international values of their currencies.
In Communist China, to keep the people inline, the Chinese Communist Party(CCP) has capital controls, and to assure their people stay under their control and don’t flee the countries, the CCP has a domestic currency (The renminbi) and their foreign exchanged currency (The Yuan), when you understand why the CCP does this you start to comprehend the problem with Canada’s housing market which is a DOMESTIC problem.
You keep hearing about these “foreign buyers” buying up housing in Canada, well, that’s a direct result MUNCIPAL mismanagement of funds. If Canadian individuals and businesses are having to pend more money on GOVERNMENT, there’s less capital to save or invest, in COMMUNIST China, there exists no equivalent welfare state similar to what exists in Canada.
And to further cut EXPENSES, labor unions for example are NOT permitted in communist China, climate change alarmism is not permitted in China, instead of going to war with energy, the CCP has subsidies for fossil fuels. So these lowering of COSTS for Chinese consumers equates to more DOMESTIC purchasing power.
More domestic purchasing power equates to international purchasing power and viola, you have Chinese people with more money deploy on Canada’s housing market than Canadians have, and this is with China also having a weaker currency.
So a lot of Chinese people will for example buy Canadian or U.S dollars at a LOSS, and still find themselves with more CANADIAN dollars for the same level of labor as Canadians who live here. I’m giving you an example of how destructive the local and federal Canadian governments are to the domestic purchasing power of Canadians.
Donald Trump who s in real estate, likes LOWER interest rates and he actually wants the U.S. dollar to be lower, so it wouldn’t surprise me if this were to happen if Trump and Pierre Poilievre, becomes leaders of their countries in 2025. If Trump were to successfully lower the value of the U.S. dollar, this would be a cause for concern for Pierre Poilievre, who on the surface doesn’t appear to be a Prime Minister interested in austerity.
Interesting times ahead!