More Olympic Photos

Well, as you can see by the countdown clock above there is only a day and a bit to go before the Olympics are here. Lots of pics from Wednesday for you. It was the 2nd Dress Rehearsal today for the Opening Ceremonies and Vancouver did not disappoint as it pissed rain on the attendees.

As you can see in this next photo, the Olympics are most certainly grouped according to class. There are the entrances for the common folk. Then the Olympic 'Family' (meaning VIPs) have their own private entrances.

This next photo was taken on Tuesday and shows one of the Live City sites. These are free celebrations put on by the City of Vancouver. This first one is by the near the Vancouver Post office...

And the second one is down on the water in Yaletown. There will be some evening pictures of this in a moment...

Inside Live City Yaletown is the Samsung Pavilion which opened Wednesday...

Numerous dignitaries were on hand. Here the Premier of British Columbia, Gordon Campbell, is shown (scarf and silver hair).

In this next pic, on the far left is the head of the Vancouver Organizing Committee John Furlong. Next to him is Jacques Rogge, head of the International Olympic Committee...

Even Wayne Gretzky made an appearance...

The entrances to all the outdoor celebrations have their own stringent security too. Here, at the Live City Yaletown entrance you can see the airport style metal detectors everyone must pass though - even for free events...

At night, Live City Yaletown has it's own set of spotlights to compete with the Vector Lightshow by the Burrard Bridge I showed you the other day...

Speaking of the Vector Lightshow, the cloudy night (the rain had mercifully stopped) made a spooky canvas for the spotlights above the downtown hi-rises...

There is a ton of the world's media on hand. You can't walk very far without seeing media somewhere. It's not a great picture, but this is Bob Costas from NBC Sports...

Not sure who this dude is, but I was walking past the Opus hotel's Elixir Restaurant and I spied him doing a broadcast...

Stopped to chat with this pair just above the Robson Street outdoor ice rink. They are from San Francisco...

At the other end of Robson Street is where Global TV is set up. That's local sportscaster Squire Barnes getting ready for his airtime...

And as if traffic wasn't f*cked up enough, CTV has got their local onsite broadcast booth set up in two west bound lanes of traffic on Robson Street just before Burrard...

Stopped and chatted with this crew. They are from South Korea...

A portent of things to come? This is the new Canada Line Skytrain station in Yaletown after the Dress Rehearsal ended. Normally people would enter the station in the front. There are so many people at this one station that staff is blocking the entrance and having the people loop around the station and enter on the side. The line up will snake down Davie towards Pacific Boulevard. And this after only a rehearsal with 30,000 attendees...

It's awesome to see the city getting swept up in the excitement. Here one balcony has the rings on display (wonder if VANOC will be knocking on their door soon?). Restaurants all over are also festooned with Canadian flags...

This is Irish House...

And the Art Gallery is draped with these oddly Hawaiian canvases. A subliminal message about all the warm rain in the Spring... er... Winter Olympics perhaps?

The steps of Robson Square have these neat stickers which form a mural from a distance...

Now... had to show you this. Enlarge the pic and read the writing on the window and you will see that some clown is apparently going to live in the Urban Barn 24/7 and be on display during the Olympics. I wonder if he likes to lounge around in the nude after store hours?

The entertainment district on Granville street is finished it's makeover and is decorated with lighted poles. It looks impressive...

Granville Street north of Robson has been taken over by a collection of bizzare street art including lantern trees, lighted totem poles and generally weird stuff...

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Apparently it's only a bubble... if the bubble bursts (note: G&M link repaired)

Okay... let me get this straight.

A senior bank executive, who spoke to the Globe and Mail on condition of anonymity, said, "we're not in a bubble yet, or a credit crisis."

But he then goes on to explain that the heads of the country's six largest banks have privately told federal government policy makers that they fear the wide-ranging economic fallout of a U.S. style binge-and-collapse in housing hitting Canada.

Say wha???

Now don't get me wrong. That's exactly what this blog has been saying for the past 14 months. But why, if the bankers don't believe we are in a bubble or face a looming credit crisis, are they worried?

The answer is simple - we are in one. That's exactly why they're worried.

It makes me wonder how all those perma-bulls, who have been deriding the likes of us contrarians, feel about the fact that our nation's banking elite is now sounding alarm bells?

Even the freakin' Wall Street Journal has come out and pinpointed the danger Canada is facing, a danger we all can see as plainly as the noses on our faces.

To wit: that household debt in Canada — largely mortgages — was 1.42 times disposable income during the second quarter of 2009, a record high. And because Canadian banks typically reset adjustable-rate mortgages every few years, those who are buying now at low rates will likely see major increases soon.

“This is exactly what happened in the U.S., when affordability had moved way out of whack with prices,” quotes the WSJ.

So what's wrong with this picture? I mean, why are the Canadian banks concerned?

You and I both know they aren't threatened by any collapse in home mortgages when these significant rate hikes kick in.

The vast majority of their housing mortgages are CMHC insured. So even though Canadian mortgages account for 40% of the loans of the six largest banks, and comprise the biggest chunk of their portfolios, Canadian banks face little risk of direct loss because of federal government mortgage insurance.

So again... what gives?

"It's not the potential of big losses on mortgages that scares banks," says Peter Routledge, an analyst at Moody's Investors Service. "But if there were a spike in foreclosures in Canada, as has happened in the United States, consumers would likely struggle to make payments on other loans that aren't insured, such as credit card debt."

"Imagine instead of a few hundred people in Toronto in any particular month being foreclosed upon, it's a few thousand. The impact on the broader economy would be significant," said Mr. Routledge.

Ahhh... the truth is revealed.

Our omnipresent (that's omnipresent, a latin term for 'weasel') Canadian banks know damn well that the future holds a dramatic upswing in interest rates, a development that will have crushing impacts on real estate.

But that's not what bothers them. Somehow these brain surgeons have only now realized that they have screwed themselves along with the rest of us - despite CMHC carrying the can on all this mortgage debt.

And now they desperately want to try and put the brakes on things before real estate spirals hopelessly out of control and comes crashing down.

Not because a collapsing real estate market will hurt the Canadian public, but because a hurt Canadian public will default on credit card and other uninsured debt.

Marvelous.

But I've got news for them... it's already too late. There are already so many Canadians who have jumped on the low-rate money gravy train (either by max'ing out on their purchases or by extracting from the home ATM) that the looming significant interest rate hikes will begin the domino process that dooms our bloated real estate bubble.

But it's nice to finally see these weasels recognize and acknowledge what they have done, even though the only reason they are speaking up is because it dawned on them they aren't as protected with CMHC insurance as they originally thought.

Interest Rates

So once again the story is all about interest rates.

Adding to the chorus of warnings is this one from Tim Bond of Barclay's.

Bond has been remarkably accurate in predicting the strength and length of the current global equity rally. He claimed that analyst estimates and high levels of bearishness would lay the foundation for a continuing equity rally - and he was right.

But yesterday he did an abrupt about-face.

“Fiscal dynamics point towards higher government bond yields in many economies, including the UK and US. History is unequivocal in linking fiscal deterioration to higher yields. This point is clearly becoming recognized by investors. As a result, a contagious process has started, during which risk premia in bonds, equities and currencies adjust higher to reflect the fiscal situation. This process is unlikely to remain confined to southern Europe, but will eventually embrace all those economies with sizeable budget deficits.”

That means Canada and, especially, the United States.

And what does Bond see on the horizon?

1)The majority of the G20 is a fiscal mess. 2)Demographic trends of the G20 are highly negative, and 3) Containing the long-term government debt problem will be painful.

Most alarming to Bond, however, is the close relationship between high debt levels and rising rates. In studying 6 developed nations over the last 20-30 years, Bond found that a 1% change in deficit/GDP caused a 32 bps increase in 10 year rates. Based on this, Bond says we are due for a substantial rise in global interest rates.

Not just an uptick, but a 'substantial' rise. Don't be surprised to see a return to late 1970s style rates.

It's coming.

And no five year fixed rate renewal is gonna save any Canadian family with a large mortgage - the time span of those high rates will easily surpass that period.

Bond sees it coming.

And the heads of the six major Canadian Banks see it too.

And if you read this blog all last year; you saw it coming as well.

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On another note... only two days to go.

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Building Art & Torch Run in Richmond

(click on images to enlarge)

Olympic Torch comes to Richmond

Today the Olympic Torch came through White Rock, Delta and ended in Richmond at the 'O-Zone', an Olympic celebration venue. There were over 30,000 people there and the evening ended with Rick Hansen taking the Olympic Flame to the community cauldron.

CTV was on hand broadcasting the festivities. Here Tamara Taggart and Pamela Martin await their cue.

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Another example of our irrational real estate market (UPDATE: see end of post for more Oly photos)

The irrational march upward carries on and not just in Vancouver proper.

Today's treatsie is this 5 bedroom, 3 bathroom 3,000 sq. ft. home sitting on a 12,160 sq. ft. lot is the suburb of Coquitlam.

You can see the realtor's listing here (with many more photos).

According to listing agent Josh Bath, this home hit the market last Friday. On the weekend 120 potential buyers came through and the house received 15 offers.

The house was last sold in 1990 for $200,000.

On Friday it was listed for sale at $639,900.

So what did the feeding frenzy produce? A final sale of $688,500... $48,600 over asking price.

Said the agent, “The previous owners of this home owned it for 19 years and after raising their family and renovating, decided to downsize to a town home. The features that really sold this home were definitely the neighbourhood and the yard."

No Josh, the features that really sold this home were ultra low interest rates and a 'buy now or be priced out forever' mindset.

Olympic Pics (click on images to enlarge)

It was a picture postcard sunny day in Vancouver today and the views were stunning. We do this to tease the media. Fear not, tho... it will piss rain for the Opening Ceremonies and Day 1 on Friday.

Below is a picture of the newly set up German House right next to the Seabus.

Next is a shot from near the Cambie Bridge. This is the east end of False Creek. Science World (the big dome) is transformed into Russia House (and is promoting the Sochi 2014 Winter Olympics). The big Q is where Quebec House is. On the left is GM Place, renamed Canada Hockey Place for the Olympics.

The big draw hockey games are at Canada Hockey Place. Other games are also at the new UBC Thunderbird Arena. Below is a picture taken today of the transformed Arena, ready for the Games.

Even the police are out enjoying the Sun at Thunderbird Arena.

Speaking of Russia House, here is the countdown clock to the 2014 Winter Games.

I notice that the Russian athletes have now staked out their turf at the Village.

More photos to come...
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Olympic Updates

The pics above are from the volunteers entering BC Place for the Opening Ceremonies dress rehearsal today. Click on them to enlarge.

The next pics are of a whole raft of searchlights set up on either side of the Burrard Bridge as it heads into downtown Vancouver. The lights are synchronized to perform a light show.

Finally... a pic from the community cauldron in Surrey tonight. The cauldron is set up each night as the Olympic Torch relay concludes for the day. The torch is now in the suburbs of Vancouver.

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Sunday Funnies - February 7th, 2010

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