cwericb

"In canada, the most common mortgage term is five year fixed which will likely be problematic for those that stretch themselves during this abnormal low rate period. Talk about asset liability term dismatch." Also the mortgage rate goes up with the term which is another problem in itself because it is an incentive for those stretching their budget to opt for shorter term mortgages (say 1 or 2 years or a floating rate) to get the lower rates. Longest amortization rate in Canada has been reduced (by law) to 25 years (40 years in 1998. Also, minimum down payment has been increased from 15% TO 20%, but there are tricks that are used to get around that. One might think that, since the longer the term, the higher the rate, that this could be a clue that interest rates may well rise.

“ Would they pay more because interest rates are low? Nope.” Unfortunately the answer to that may well be yes. I deal with people building new homes on a regular basis and I have told this story here before, but it bares repeating. I used to ask theses young couples how much their new house was going to cost and I was shocked that very few could tell me. The conversations would go like this: “So, how much is the house going to cost in total?” The couple would look at one another with a blank look on their faces and the reply would be... “I don’t know, but our mortgage payments will be $1,200 a month.” “Yes, but about how much will the house cost to build?” “Well we never asked about that, but our mortgage payments will be $1,200 a month.” “Look folks, if you pay $400K for the house today you will have always paid $400K for that house, but that $1,200 per month could well be a lot more than that in a few years” “Haha.... well that better not happen!” After running into that line of thought time after time, I don't bother asking anymore. The only explanation I can come up with for this attitude is that these people have been used to leasing cars and don’t understand the huge difference between leasing a car and buying a house. But as to the original question, unfortunately there are a lot of people out there who only look at the monthly payment and for an old dude like me who has paid as high as 17.5% for a mortgage I just shake my head at these 2.5% mortgages. Mortgages have practically no room to drop, but the the potential rise is unlimited.

I looked at some of Hurst's crap and I hope that Sender's not relying on his "collection" for retirement income. My sister fancies herself as somewhat of an art connoisseur. One day I put a bunch of dots, lines and squiggles on the screen and converted it to a jpg. Emailed it to her and told her it was something Alex Calder had done. She thought it was just wonderful. His colours were so bright and the juxtaposition of the lines were 'just right'. Some people's taste is all in their mouths. While Fairfax has not recovered any monetary value, there is some satisfaction to see that Sender has squandered a good portion of his ill-gotten gains on what most of us would see as worthless junk. Of course he could always invite Steve Cohen over to enjoy his collection - better than going to the crowbar hotel.

He who has the last laugh laughs best?

"Mr. Sender, 45 years old and a prominent collector of contemporary art, repeatedly has said a 2006 lawsuit against Exis by the Canadian insurer Fairfax Financial Holdings Ltd. had hurt Exis's ability to raise money." http://online.wsj.com/news/articles/SB10001424052702303942404579360550785047372?mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702303942404579360550785047372.html

Jeez, my problem is the direct opposite. Probably greed causes me hold on to stocks long after they hit their highs. SFK/FBK being a good example. Bought a substantial amount at .50 then some more at about .90. Then watched it run to $2.00, but I let it drop back to about .85 before I finally dumped it. I have also held stocks and let them go to zero. Now this isn’t the “grocery money” and holding long term major positions in stocks like FFH, RY and BOX.UN has done quite well for me over the years, but I really have a hard time selling anything. I have thought of using down limits but I have quite often seen sudden dips and a quick recovery that would have triggered an unwanted sale. Part of my problem is probably due to the fact that my time to spend on this is relatively limited. Anyone else have a habit of hanging on too long?

Nor do I wish to engage in a pot debate. But who among us does not regularly engage in things that are “bad” for us. In fact I sometimes think that if I like it, its not good for me. Sugar, alcohol, red meat, and well, just about anything most of us like. I would not see pot as being much different. However, I have to agree that the idea of smoking anything is probably not a good idea. Brownies anyone? Sugarless of course.

I don’t smoke pot, but I strongly support its inevitable legalization. In the 1920's we had the prohibition on the sale of alcohol which lead to an era of violence not seen since the days of the “wild west”. Once alcohol was legalized and controlled it was generally realized that you cannot refuse to give the public what the public wants. After all we do live in a democracy. Yes, pot can lead to hard drugs. But that is because it is illegal. Therefore pot must be procured from the same people supplying hard drugs. It is in their best interest to upgrade pot smokers to addictive, and more profitable drugs. This is not rocket science. We tie up our courts, our law enforcement and our jails wasting billions of dollars punishing people involved in its growth and sale. But the worst waste is the waste of lives by incarcerating the many young people involved in its growth and sale and leaving them with criminal records. In many cases might not these people be future entrepreneurs? Alcohol is addictive and there are few among us who do not know good people who are alcoholics. Contrarily, pot is not addictive and there is good evidence that it has medicinal value. Vested interest groups such as law enforcement and distillers are wasting millions lobbying against it but they are fighting a losing battle because you cannot refuse to give the people what they want.

Contrary to this topic, what does the board need more of? Humour. Sometimes we just gotta lighten up a little because some here take themselves way too seriously. Uccmal and Kraven both understand that quite well.

One thing that tends to tick me off is people who don’t understand the difference between facts and their own opinions. You may be 100% certain that something is going to happen, but that is usually just an opinion until it either happens or doesn’t, only then is it a fact. As has been said, "Opinions are like a**holes, everybody has one."

Yeah, well its -18C or 0 F here today and and a foot of snow and high winds for tomorrow. We've had winter here since mid November and normally we rarely see snow before January. I've spent a fair amount of time in Cuba. Ten years ago on my first trip there I was very surprised to find that there were no incandescent bulbs to be seen. All bulbs had been relaced had been replaced by CFL's and that was in 2003.

Our city government was also of the opinion that the heat generated by incandescent bulbs was wasted energy and expense so, in their infinite wisdom, they replaced all our traffic signals with LED's. Now, because the lights generate no heat, they have to have a crew and a truck with a cherry picker (boom) to clear the snow off the lights. Not only does that pose a traffic problem in itself, but if often a useless exercise because if it is still snowing, 5 minutes after they clear the lights the snow blocks them again. To complicate matters, because the snow is usually accompanied with wind, this means only half the lights at an intersection are usually blocked with snow while the traffic from the other direction may not have a problem. It can make for some interesting driving. There has been some talk of equiping the lights with electric heaters. Yup that will save energy. Aaaa, progress....

(For Canadians..) Please forward to Stephen, Mike, Pam, etc? :)

I have Google set to notify every time there is something in the news about FFH. I usually get a couple of items a week, but for the past several months I am getting five or ten a day a day or more. For a lot of people FFH has been flying under the radar for a long time and you have to wonder if all the recent talk about BBRY has made a lot of investors take a closer look at it and they like what they see. HOWEVER we've seen these ups and downs many times before and one has to wonder if its time to take some profit to re-invest later. Is anyone doing this now?

Don’t know why you guys are laughing. If he sold one to his father, his mother, sisters & brothers, he probably made a thousand bucks. Furthermore, while others scoff, at $5.56 per page this could be one of the most expensive books recently published. I also note that the book ranks #241,990 on Amazon’s best seller (cellar) list. Also I believe you have to buy a book before you can review it on Amazon. Therefore, one might deduce that there are at least seven in his family since he has seven positive reviews. For some reason, every now and again, and as recently as last week, I receive an invitation to join Harry’s Linkedin network. I think I’ll pass, but if anyone wants his email address....

This might be a little off topic, but here is some food for thought. Certainly housing in some of our major cities seems over priced and a correction may be overdue, but in the longer term consider this. When I was a child the world population was about 2 billion. Today its about 7.2 billion. The UN projects that by 2050 the population will reach 9.6 billion. That’s a 33% increase in just 37 years! These people have to go somewhere. Canada is one of, if not the least densely populated industrialized countries in the world. People are becoming ever more transient and if you think we have a lot of immigrants here today, you won’t recognize the make up of this country in 20 years. This is simply a fact of life. Think about these numbers... The population density of India is 380 people per square kilometre, Japan - 339, South Korea - 487 and Bangladesh - 1035. The population density of Ontario is 12 people per square kilometre , Quebec - 6, British Columbia - 5, Saskatchewan - 2. Yes, some of that may be presently considered uninhabitable (at least by today’s standards) but Nova Scotia has a density of 17/ sq. km. and New Brunswick with 10. I also believe we are seeing another shift that I have been predicting for some time. There is going to be some levelling out of the population within this country along with property values as geographical location becomes less important than it once was. I am seeing more and more people moving to desirable locations outside of the major centres and commuting to the city perhaps once a month while they work from home through cell phones and computers. Example: I met a guy last week. He lives in the Maritimes, but he is in charge of equipment and personnel for a mid sized airline based 2,000 miles from here. He does everything from his house on the beach and commutes to work once a month. His wife also works for another company in a different city and both are able to spend most of their time here. This is not an isolated example by any means and I see it more and more frequently. While this may have some downward pressure on some of the high priced real estate in major centres it will have the effect of increasing prices in other areas. You just can’t have a forty year old bungalow selling for $1,000,000 in Vancouver and the same house selling for less than $200 k in a nice, low crime neighbourhood elsewhere. Maybe in times past, but not today. That demographic is changing.

“It is profitable” That’s great! So we all share in the profits. We put up with a few ads and we get a great, well monitored board at no cost!

What goes around, comes around. :)

While it’s unfortunate for Madoff victims it obviously looked like a good deal to both sides at the time or it would not have transpired. Hindsight is 20/20. No one set out to take advantage of anyone. It seems like someone did their homework and someone did not. If I sell a stock tomorrow and it triples next month that is just my bad luck or mismanagement, I certainly don’t think the people on the other side of the trade should refund my money or pay me more. This might be a bit of oversimplification but doesn’t the same principle apply?

There has got to be money in this field. Last month when I went to pick up a couple of Lego sets for my Grandson at Christmas I was floored when I saw that many of the sets were priced in the $3-400 range!

SD, I guess I'm mostly ticked off at myself for not dumping SFK/FBK when it was bouncing around $2.00, but that's what happens when one gets greedy. I wonder if we are seeing anything something similar with RIM?

CONeal knows what he is speaking about. Credit scoring is a joke as it ignores assets like cash, investments, and property. But the more debt you have the better so long as you are servicing it. If you have no debt then they seem to assume you don’t own anything. No mortgage - then he must not own a home. No car loan - then he probably doesn’t have a car... Many years ago, before credit scoring was widely credit histories were kept on card files that were updated manually. Whenever two people married their files were inter-referenced. As cards were being matched up I can remember frequently hearing, “OMG, does he (she) know what they are getting into?” (More often “he” than “she”) I have always believed that before a marriage licence is issued it should be mandated that a mutual disclosure of credit histories be made.

"Put another way: I am going to let FFH do some of my investing for me." Uccmal, you have said this before and You are probably right. After the FBK experience I will, for the most part at least, do the same. I'd rather be with them than against them. As for the "Fair and Friendly" I really don't know how they could justify that in the FBK story. Perhaps it should be "Fair and friendly when convenient"

"I don't feel good about their rejection of a higher takeover offer for Fibrek" Ditto. As a former FBK shareholder I am quite unhappy with FFH. However as a FFH shareholder I have no complaints. So I guess the lesson here is that if Fairfax owns a significant position in a company stay away from it.

I have no connection with Pizza Delight but I am rather surprised at the apparent prejudice against these restaurants. Pizza Delight restaurants in this area are quite nice and have been very popular and successful for many, many years. It is not uncommon to have to wait for 10-20 minutes to get a table. While at the same time, giant Pizza Hut closed its doors several years ago and Domino’s offers only take out. Combined with their acquisition of the Prime group of restaurants perhaps Fairfax knows what they are doing and are in the process of building something. While these restaurants may be more working class that upscale, that may not be the point. An old boss of mine used to have a couple of sayings that seem to fit this scenario. One was "Is there any money in it?" and the other was "Everybody’s gotta eat" Fairfax Restaurants: Pizza Delight Mike’s Score’s Baton Rouge East Side Mario’s Casey’s Pubs: Fionn MacCool’s D’Arcy McGee’s.