Random Items

A cornucopia of things for you as I press my nose against the window of the world today. It's also only 7 days before the Games.

Olympic Games

Since I will be in Downtown Vancouver during the Games, I hope to bring you some streetshot photos of things going on outside the venues - no promises though.

Less than flattering news articles on the downtown eastside continue. Here's one from the Globe and Mail.

Meanwhile the lack of snow on Cypruss is fodder for the late night talk show circuit. I mean, honestly, anyone who lives here knows that it's no great surprise there is no snow locally in February. Why on earth isn't every alpine event up at Whistler?

A sports segment on ESPN shared that sentiment when talking about Cypress Mountain. The host of the segment said, "This isn't the big downhill mountain, this is some dopey little mountain where they're going to hold their little dopey X Games events."

Sigh. Too true.

Interest Rates

The people at the Council on Foreign Relations speculate that US interest rates on Treasury debt will be increasing around the end of the first quarter if the Fed discontinues its monetization of mortgage debt.

As the Fed has essentially purchased ALL new US Treasury issuance since 2009, that seems to be a reasonable bet (hattip: Jesse's Café Américain).

• "The Federal Reserve plans to stop buying securities issued by government housing loan agencies Fannie Mae and Freddie Mac by the end of the first quarter.
  
  This is not only likely to push up mortgage rates; Treasury rates should rise as well. Throughout 2009, the private sector sold a portion of their agency holdings to the Fed and used those funds to buy Treasury's.
  
  Once the Fed’s agency purchases stop, this private sector portfolio shift will end, removing a major source of demand in the Treasury market.
  
  As the chart shows, since the start of 2009 the Fed has bought or financed the entire increase in Treasury issuance. As Fed purchases slow and Treasury issuance continues at a high level, interest rates will have to move up to attract new buyers."

PIIGS

Gold has plunged downward as the US dollar surges against the Euro yesterday and today.

Why is this happening? The big story is the sovereign debt concerns of the impolitely nicknamed PIIGS. The PIIGS are Portugal, Italy, Ireland, Greece and Spain.

Driving the flight to the US dollar is concerns focusing on debt to GDP percentage of these countries.

What's so truly bizarre, however, is that the United States stands directly in the middle of the PIGS nations on the debt to GDP percentage scale!

In the US, state after state is facing serious budget problems. The latest is Connecticut as this report notes. "The signs of economic distress are everywhere -- in our towns, our homes, our businesses and places of worship. Connecticut residents are paying attention, and elected state officials who ignore what they are telling us do so at their own peril. If we thought that passing a state budget was difficult last year, just wait. This year's three-month legislative session will be brutal."

So... if the argument against the PIGS is the debt to GDP percentage. The exact same argument would place the US dollar in a crisis position.

Not to hard to see what lies ahead here.

It's becoming a race to the bottom, which ultimately is what makes currency values what they are. Watch for similar arguments about the size of the debt to GDP ratio to soon batter the US dollar.

Froogle Scott Chronicles

The next two instalments of the Froogle Scott Chronicles are out over at VREAA.

Part 2: Up, Up, Up: Winning the Real Estate Lottery can be read here.

Part 3: Priced Out Forever? Vancouver Renters and Basement Suites can be read here.

That's it for now. Updates may or may not be added.

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Email: village_whisperer@live.ca
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What the hell is a 'Froogle'?

Have you ever heard of the Vancouver Real Estate Anecdote Archive (VREAA) ?

It's a unique blog that was started up in February of 2008 to serve as a repository for accounts of what people are experiencing and observing regarding Vancouver’s real estate boom.

For the most part the blog is a giant collection of quotes (with references as to the source) from the greater real estate community.

Yesterday they added an interesting sidebar to their blog.

Billing it as a 'serialized anecdote', VREAA aims to highlight the personal and social effects of the boom through a Vancouver couple who bought a house in September 2003.

'Froogle Scott' is the online handle of the Vancouver homeowner who will share his story.

From the introduction to the series by VREAA:

• "The 2001-2010 Vancouver RE market has affected our city profoundly, and touched many of us in ways that have changed our lives. We started collecting anecdotes here at VREAA out of a fascination for the personal and social effects of the boom. A similar captivation has led a Vancouver homeowner to write of his own experience, and we are very pleased to bring you his serialized account, with its numerous anecdotes. ‘Froogle Scott’ will share his story of buying a house in Vancouver, and the journey that he and his wife have been on since that day in September 2003. In the first episode, we hear the story of the buying itself. Here begins one couple’s multi-faceted experience of this boom."

The series can be found on the main page of VREAA or you can access a permanent link to the series here.

I'm told comments on the entries are welcome, if you are so inclined.

Maybe someone can ask him what the heck a 'Froogle' is.

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Email: village_whisperer@live.ca
Click 'comments' below to contribute to this post.

Please read disclaimer at bottom of blog.