The Bank of Canada is adding the downward drift in prices for oil and other commodities to its catalogue of threats to economic growth.
In a one-page statement on his latest interest-rate decision Tuesday, Governor Mark Carney mentioned oil or commodity prices four times. To many economists and analysts, this was a clear hint of growing concern as oil prices, while still historically high, inch downward to $80 (US) a barrel – considered an unofficial breaking point at which investment in energy projects could stall, putting jobs at risk.
Carney, who left his main interest rate at 1% Tuesday, noted that the “sizable reduction” in commodity prices owing to slower global growth is keeping inflation in check and could mean cheaper gasoline well into next year. But he also cut his 2012 and 2013 projections for the economy, in part because the consumption and business investment he’s counting on to drive growth will be held back by “the effects of lower commodity prices on Canadian incomes and wealth.”
Oil still costs close to $90 a barrel on global markets – a far cry from a low of $35 reached during the thick of the 2008-2009 financial crisis. Still, prices are down 10% from the start of 2012, as demand from big emerging markets like China cools off, and as anxiety linked to the European debt crisis pushes investors away from commodities and toward relatively risk-free securities such as the US dollar.
Click here to read more from the Globe and Mail.
When the government cut maximum amortizations in 2008 and 2011, most big lenders reduced amortizations on all of their mortgages.
They didn’t need to apply the changes to uninsured mortgages, but many did anyway.
Not this time.
When the Department of Finance trimmed the insured amortization limit to 25 years on July 9th, most lenders left their conventional mortgage amortizations at 30-35 years. Even the major banks have left 30-year amortizations in place, which surprised many of us in the business.
Forget the residential market, maybe it’s time we started focusing on how strong Canada’s commercial real estate market has been, says Sonya Gulati, an Economist with TD Canada Trust.
“The commercial side of the market has recorded quite a comeback from the troughs posted in the early part of the recovery,” said Gulati in a report.
The economist notes $21 billion in commercial real estate assets sold last year, up from $10 billion in 2009. She says the short supply of projects coupled with demand has caused most regional markets to tighten over the past 12-18 months.
“The tighter conditions would lend itself to a new round of projects. We are already seeing development intentions materialize – there are renovation plans in major shopping mall centres across the country and there are an elevated number of new office towers being built,” says Gulati.
Click here for full details in the Financial Post.
The speed at which mortgage brokers have adopted a networked, online lifestyle has been impressive. I would say 95% of the deals I do are processed via email or Skype.
What’s more, we receive electronic correspondence from brokers virtually 24/7 – an indication that business hours are changing.
Unfortunately, being networked is not without risks. Back in May, I attended an industry trade show in Vancouver and witnessed something disturbing. The Fisgard team had wrapped up Day 1 of the trade show at 11pm on May 7th. When I returned to my hotel room, I started up my laptop and was dismayed by what I saw.
There were no less than 20 personal computers on the hotel WiFi network, available for me to access. I am talking about shared hard drives.