rb

So basically poor tax planning? Trying to avoid buyers tax by paying fees and running into a tax chainsaw?

Something tells me that the structure is a bit more complicated/sophisticated than that otherwise the feds would tax the shit out of the holdcos.

Interesting interview. Thanks for sharing. Refreshing to see someone rightly calling bullshit on the real estate industry party line of it's lack of supply/give us the greenbelt.

Yes you've read correctly. i have an anti-home bias. Nothing wrong with my home, just that the market is undiversified and I just don't like the companies. I also don't think there is anything wrong with home market bias. You're more likely to understand business conditions and companies in your home and neighboring markets then some far flung corner of the world. So your circle of confidence is bigger/stronger close to home.

Home country bias? Funny, I have an anti-bias to mine :P Me too!

There may be some other things happening and I'm guessing it's not affecting all members equally. For example: Today I was getting email notifications of posts but the site would not load until about 8 PM EST. So the site was was working for some members but not others. At around 8PM the site would not load, I showed as logged in but I could not see any posts or threads. Right now, around 10 PM EST, the site loads and I can see threads. However I cannot see recent posts I know exist because I have email notifications: for example posts on the GM, SCHO.CPH, and Garth Turner - Real Estate in Canada threads. I'm not complaining, just hoping my feedback will partly help to fix the problem. Edit: It appears I cannot see any posts between end of March 31st and the first post on this thread.

If I remember correctly he stated in one of his letters that he's never lost more than 5% of the total on one bad bet. He does a good job of obeying his rules #1 and #2. Yea. Buffett loves to self deprecate about Dexter Shoe but that wasn't near a blowup. More of a bad decision. I think way more money was wasted with Gen Re. In addition a lot more could have been wasted if warren wasn't so sharp. Just imagine the derivatives desk in 08.... scary! But Buffett won't slam Gen Re. Instead he harps on Dexter Shoe because it's no longer with us.

This is largely true with his public equity investments. But I excluded him because he has had blow-ups in private investments and bonds. Specifically, Energy Future Holdings. Still, on a portfolio basis, his batting average is very high. Yes but weren't the blowups relatively small? None of the big bets blew up. I'd say that the biggest screw-up at BRK was the Gen RE purchase and even that one kinda sorta turned ok in the end.

I'll go with the obvious and say Warren Buffett. I believe he's explained his process over the years.

I should add that the issue is more complicated as there are different kinds of Lithium battery. The high performance batteries use cobalt based chemistry because they have the highest energy density. Apple and must cellphones use a type of battery called Lithium Cobalt Oxide that is the highest performance (and the most likely to catch fire btw). As far as I know Teslas use a battery called Lithium Nickel Cobalt Aluminium Oxide. This battery has a lot less cobalt than what is used in phones and laptops at a performance trade off. Other cars like the Nissan Leaf use a Lithium Manganese oxide the. These batteries use manganese instead of cobalt which results in lowest energy density among the lithium batteries but they are also the safest and they have the longest life. But they are probably off the table if you want a 300+ mile range EV. We could also make further advance and invent another Li battery that doesn't use cobalt and is more stable.

I don't know where you can get Lithium spot prices. But keep in mind they call them lithium batteries but that's not the most important component. Other metals are. As I remember the most expensive part of the battery is the cobalt in it. Cobalt sells now sells for about $54,000/ton up from around $20,000/ton in 2016. It's traded on LMX and the biggest reserves by far are in Congo.

LOL!!! :)

My longest running position is TD. Bought it in 2006 back then it was about 30% of the portfolio. Did about 12% CAGR since then. Not earth shattering but not bad either. Let me build a bit on what some have said here. Basically if you hold a well performing stock (muti bagger, etc) in a cash account you're stuck with it. When you take into account the tax hit on sale most times it's more profitable to continue holding it rather than sell it even if it will under perform. People should think more about after-tax returns rather than pre-tax which is the norm. It will help a lot with not selling compounders and they may be rather pleased with the results.

I think Cardboard is pretty spot on. I might add that using Amazon as an example is kinda cheating. The one company who's stock has done well over the period. If you look back at what were the "FANG" stocks back then - AOL, Microsoft, Cisco, Yahoo, Amazon - and you bought them as a basket you would have had a pretty bad experience over the period. This is mainly because their future earnings have been greatly overestimated. Basically their valuations were too rich. Also, generally as a group their margins (the ones that had margins) shrunk and they got new competitors. As a thought experiment let's also assume that everything would have gone according to the script. I'd say that then's Yahoo and Microsoft is basically represented today by Microsoft, Yahoo, Google, and Apple. If you combine their market caps and look at the return over the period it would still be pretty pedestrian.

After a full 10 months in the job!

I'm not, but I personally know members of this board who are. I don't want to publish names as I'm not really clear on the etiquette of discussing other boards on this one.

Well there is no CDS although that doesn't matter much cause it's not like we would have access to CDS. On top of that the option market is nowhere as deep or liquid as it is in the states. One could just straight up short MIC and HCG. But like the subprime cos in the states the carry is pretty big. Though despite the carry you were rewarded if you shorted the US subprimes. Another way would be a long short on the canadian banks. I think that the banks will be ok in the end. But they will take body blows. Some more than others. My favorite would be long TD short CM or some fancy option strategy around that. The reward won't be as large as betting on a MIC collapse but the carry isn't bad. If anyone has other ideas, please share.

Humans are going to be ok. This argument is as old as the post industrial revolution age. For centuries technology has displaced human jobs. However the technological disruptions tend to come in waves. The reason we are having this discussion today is because the latest wave - robotics/computerization - has displaced a lot of manufacturing workers over the last 25 years and it has led to society tensions. I bet that they were having the a very similar discussion when electricity and AC motors came around which was a much bigger disruption then the current one. However humans were fine after that disruption and we'll be fine after this one. Human ingenuity will come up with something we just don't know what it is. That's just how it works. The problem is that while we'll be fine in the end. These disruptions cad and do cause a lot of pain in the short term. This is because a 45 year old machinist doesn't make for a very good programmer. These people didn't do anything wrong. They were just in the wrong place at the wrong time. We should probably keep that in mind and try to find a way to either smooth the transition or ease the pain. You can think of agriculture as a mental model of technological disruption of human activity. 300 or 400 years ago basically everyone worked in agriculture. Today almost no one works in agriculture. Almost all the workers have been displaced by technology. Humans were fine and agricultural production is way way higher than before. But that ride's been bumpy at times. That's what we have to look forward to.

Look there are certain reasons for my optimism, it's not just cause I'm a cheery guy. Firstly, things are probably not that bad to start with. All those slides are hockey stick charts. Never trust hockey stick charts. Also you have to consider the source. That deck is from pete peterson's shop. For decades his shtick has basically been we must cut entitlements or we'll be dead any day now. Somehow the US is still around and kicking. Healthcare cost is definitely a problem in the US and something will have to be done about that eventually. The good news is that this is not something where the US must invent a solution. Pretty much every other place in the world solved the problem. The US can just copy them. In my view in the end the final solution will probably be comprised of some combination of lower military spending, changes to the healthcare system, and somewhat higher taxes. The solution will come when the situation gets worse and people get serious about fixing it. Right now things are not bad enough and people aren't really serious about solving it. Of course when the time comes loads of people will hate the solution, they'll huff and puff but they'll have to swallow it. On the issue of taxes, deficits, and debt you can also think of it this way: The reason the US has constant deficits is because the taxes set constantly too low. So people get to keep money that they would otherwise have to pay in taxes for services. The catch is that they have to use that extra money to buy US treasuries. I'm not sure whether if that can go on forever but a good argument can be made that it can.

In my opinion, things aren't nearly as bad, or as complicated to fix. It'll be ok.

explore "the RRSP/RRIF meltdown strategy", if you interested PM for more info . I don't think the meltdown would work. To melt down $1 million in RRSP (kinda the amounts I'm working with) and 1.5%-2% margin interest one is looking at at truly staggering amounts of debt. Any other ideas anyone?

Can you please elaborate a bit? I think the original question (as well as my current one) is how do you actually place the rental property in the tfsa account.

I believe average house price in Toronto is around mid 700's. Average detached is above 1m. Your analysis is interesting and much better than mine. How are people even getting CMHC insurance? I don't get it. CMHC require that you can spend no more than 32% of your gross income on Principal, Interest, property taxes and heating on housing. https://www.cmhc-schl.gc.ca/en/co/moloin/moloin_003.cfm So with the median household making around 76k, you can only service your house with 76k*0.32/12 = 2k per month. Heating is 100 a month. Property tax is 300 a month. So you are left with 1600 to service the house. I've plugged that into the TD mortgage payment calculator and I get that the most you can afford is $400,000 of principal for the mortgage. I don't know for sure what the house prices are. CREA is showing a composite average for Toronto of 876K. But you have a lot of 1 bed condos in there. Not exactly what i was calculating for. With condos we get into different discussion about maintenance fees and the like. Also if you have small semis going for 800k in the burbs I doubt you can get anything non-condo for under 1m in the city proper. It's even harder to know prices today because listing prices aren't prices anymore. Just some theoretical start point for an auction. -- See one example in Liberty's link in the post above.

Al, Each RESP has 2 accounts behind it for accounting purposes- a capital account and an income account. The capital account basically holds your original contributions and the income account holds your profits. Direct your broker to pay out the income account first. If you are left over with just capital contributions then there's no tax on that because they were taxed originally as income.

I kinda did if you read post 1331. But let's unpack that even more. To get the the great "pin down" number. One way to figure out the maximum paid is to see what's the maximum you can qualify for under CMHC rules. I believe that current rules do allow for reasonable expenses outside the home. Lets assume $3,600 in property tax, $1,200 insurance, and $500 for 1/2 heating costs. You're right that the median family income in Toronto is 75K. But screw them if they're not smart to make real coin they should be homeless. Let's go with $120k annual income. 32% of that is $38.4K. Take out expenses and you're left with $33.1k for mortgage payments or $2,758 per month. At 5% down payment that's 516K max for the house. At 20% it is 613K. So I would go with the max pin down number as 613K for say a 1,500 sqft place. I believe we blew through that number a while back.