[MaxResolution]

I love market volatility. For us po'-folks it just comes with the turf! By this time next week I'd love to see half the yuppies on Wall St. sporting fresh 'Britney Spears' hairdoos.

As I see it, your last sure bet was in back in May; Gold at $551./ Silver $11.20 or so, before Helicopter Ben came in to work his inflationary magic. After which, your only currency safe-haven was to float your money in a boat!

Speaking of transparency, here's a story that is sure to enlighten you on metals futures.
"Zimbabwe gold miner says on brink of collapse" http://za.today.reuters.com/news/new...D-20070302.XML

BTW, anybody got snapshots of Mugabe's private yacht(s)?

[outmywindow]

Originally Posted by Codger

This just came to me. Good chuckle for those that actually can balance their chequebook. This applies just as much north of the border by the way.

So true Codger, just to shine a light on our "micro market":

-Starter condos downtown are $600-$700 per square foot
-High end; North False Creek & Coal Harbour is $1,000 -$1,200 per square foot
-Banks are providing 100% financing to first time home buyers
-Double digit gains over the last 4 years

It's a house of cards. Not if but when, will be undergo the market collapse that certain American cities are/have experienced recently.

[Codger]

outmywindow
We purchased half a dozen houses in Calgary back in 00/01. 1100/1300 square foot places close to the airport for our guys to stay in when they went there. We just bought them because the guys asked for it and having done those years where I spent upwards of 250 nights a year in hotels I saw where they were coming from. We paid 110/135k a piece and furnished them from Ikea. Turned out that we were ahead of the game since it cut the hotel bills in Calgary by half. Also zero damage bills since the places were treated as homes rather than just another poshed up $150/night cell.
These are all paid off so there are no assumable mortgages. Despite that, in q3/q4 last year we were deluged with unsolicited offers ranging from 230 to 265K a piece. I can tell you for a fact that wages in that area have not more than doubled in that 5 year period so something is seriously wrong with the picture. What happened to the rule about not spending more than 25% of your disposable income on shelter?
The strange part of this is that Calgary gets most of it's water from a glacier that is melting away at a significant rate. I like to play with the possible scenarios of what will happen when that glacier is gone in 15-20 years and there are all these houses on 20-30 year mortgages.

[outmywindow]

I’m surprised that your houses have only doubled in the last 6 years; I would of thought triple at least. (maybe get an independent appraisal if your considering selling).
The Banks allow 45% of total gross income to go towards mortgage and taxes, although with today’s west coast prices the actual figure needed has been more like 60-75% of income.
Our West Coast (Vancouver) market is based on “speculation” and without too much substance, other than it’s a very nice place to live.
I don’t think I would worry about Calgary to much, after-all it’s the new Houston / Texas of North America with the Tar Sands and Corporate Headquarters for energy companies.
Look at the prosperity of Las Vegas in relation to water shortage, hey, if it becomes a problem, they can build a pipeline and have some of ours here on the “wet coast”.

[MaxResolution]

-120 DJA at the bell! Now, anticipate a minor up-tick through the day on Monday, and Black Tuesday here we come. I'ts 1929, as history repeats itself...

But seriously, we know the stock market will never crash because that's what we learned in high school. Obviously, with over 20 new condo-skyscrapers underway in Miami, somebody anticipates a deluge of cash rich buyers. Never mind the death of Ford, GM and Chrysler, South Florida will continue to buck the trend for quite some time. Boating sector production now outpaces tourism. Like I said, a mega-yacht is better than a land-bank and far less volatile than gold.

[outmywindow]

Originally Posted by Loren Schweizer

From the retail world, there is usually an upswing of boat deals when the market tanks.

Looks like you will be in a Porsche sooner than later

Mortgage defaults start to spread
Ruth Simon and James R. Hagerty
Wall Street Journal
Mar. 1, 2007 12:09 PM

The mortgage market has been roiled by a sharp increase in bad loans made to borrowers with weak credit. Now there are signs that the pain is spreading upward.

At issue are mortgages made to people who fall in the gray area between "prime" (borrowers considered the best credit risks) and "subprime" (borrowers considered the greatest credit risks). A record $400 billion of these midlevel loans - which are known in the industry as "Alt-A" mortgages - were originated last year, up from $85 billion in 2003, according to Inside Mortgage Finance, a trade publication. Alt-A loans accounted for roughly 16 percent of mortgage originations last year and subprime loans an additional 24 percent.

[Loren Schweizer]

If you read 'Barron's', FT, WSJ or are otherwise among the cognescenti, the warning bells were ringing loudly for the past six weeks.
For those who kept their powder dry, there is now/soon/later some great opportunities to buy some large caps right or, depending on your persuasions, look for some blood in the markets...even some corners of the yacht markets...and pick up a deal.
Subsequent to October 1987 ( just in time for the Ft. Laud. Boat Show! ), there was a short quiet period, followed by a good two-year run in the boat biz.
9/11 took about five months for the phones to start ringing again, but that was a different scenario altogether.
Greenspan aside, the pundits see no impending doom on the horizon... and as for the sub-prime borrowers and those on the ladder step just above, well, if you're gonna be dumb, you'd better be tough.

[MaxResolution]

I meant the 'Dow,' not DJA which only slid -12pts on Fri., but not sure of my source, or the statistical disparity even now.

FT used to have a forum where one could bet the movement of the Euro. Always ahead of the game, I foolishly had it pegged at a whopping $1.30 back in '03?. (Just ahead of it's low at $1.179.) My predictions were so askew, I spawned a jucy discourse from the editors, nevermind their pedantic response; something about "taking a pre-paid vacation."

I see housing down for the count, and the ripple-effect will impact every sector of the American labor market. The message is simple: "take your money and run!"

Speaking of NINA's, need I cite the Toll Bros., living large off ma & pa, on the Rivera?
Obviously, the vulture's chips are moving to private equity, but this Paulson daisy-chain finance orgy can't last forever. The 'blip' is just War, and rumors of more...

[MaxResolution]

Evidently, Loren's liqidity has him reaching for the premium aged scotch. But for the rest of us, let's not forget: Once we had Clinton, Johnny Cash and Bob Hope. Now we have Bush, no Cash and no Hope!

[airship]

Are we all looking forward to an uncertain week?

According to that BBC report, 70% of us consumers:

"...are still frolicking on the beach".

I can't be one of them, because for at least the last 5 years although I've noticed lots of holiday-makers on the beach (and the roads) as I drove past in-between clients, I've mainly been pre-occupied by how I'm going to repay 3 loans I took out when everything looked simply hunky-dory.

As far as I'm concerned, most of us are on a roller-coaster to hell:

On the one hand, we have globalisation which translates into jobs disappearing somewhere else because the companies we work for simply have to delocalise mostly because their competitors are doing it. You have to feel sorry for these companies, having vainquished the trade unions over the decades and having their employees' best interests at heart in this modern day, only to find themselves slaves to another master...

And on the other hand, we have the phenomenon (last seen in feudal times) where a very small minority of individuals possess the vast majority of assets and personal wealth. I've seen this process at work: the rich superyacht owner who pays an inflated salary to someone aboard who mainly serves at the table and washes up afterwards, contributing nothing, but will always have a ready smile. Compared to the yacht owner's employee at the steel mill who literally slaves away in hellish conditions, merely in order to keep the stewardess (and her boss) in the comforts to which they've become accustomed...

65 million years ago, the dinosaurs died out. I'm not saying they had an easy life ruling the planet. Tyrannosaurus rex certainly didn't swan about on a Feadship in those days, it's certain.

I guess, that what I'm trying to say is that we don't need a correction or even a recession next week. What we need is another Ø250m asteroid collision...

[YachtForum]

The number of foreclosures are overwhelming courts & clerks in the highly speculative city of Port St. Lucie, Florida. This scenario is playing out in other areas of the nation too.

http://www.palmbeachpost.com/localne...LERK_0304.html

[techmati]

the problem with the chinese market was due to the government suggesting that they would tax profits on stock trading. they eventually backed down on this. also many investors decided to take their profits at that time. the market has been very good over the past years going up and up. this led to other markets falling as well.

talking about globalisation, the worrying thing is so much manufacture subcontracted to china etc. now we are seeing even design to be subcontracted as research and development expenditure affects badly the profitability of companies. this is one thing i really hate. when a company becomes public it becomes a slave to the profitability which must increase every quarter or year. real investment and indeed strong research takes years to mature and a company may be in bad profitability during that period until the investment finally pays off and the company takes off into another level of profitability.

[MaxResolution]

Reviewing this past week's news items suggests an even more precipitous storm-front than the failure of sub-prime real estate loans. There is more to this than simply padding the books, off-shoring assets, 500% more to the top executives than they are paying their average laborers, false government statistics, hidden inflation and trusting Hollywood to take care of our (children's) educations.

Bob Chapman's assesment is quite explicit:
Tuesday’s stock collapse is a strong indication that the four-year bear market rally arranged and managed by the Treasury and the Fed is over. The US economy has faltered for a year and few wanted to recognize it. The self-reinforcing asset inflation spiral is changing. Lower equity/asset prices will produce stress on earnings, consumption and debt, which will force liquidation of assets and institutes a negative spiral. Significant busts occur in March and April. In 1929, the first three days of March produced a 5% decline. A rally followed and by month’s end stocks had fallen 12%.

In 1987, stocks fell 8% in April and after an early May rally stocks declined to a 10% springtime loss.

In 2000, stocks collapsed in March, led by OTC stocks. They bottomed in April then rallied to September 1st. Then the real decline began just like it did in 1929 and 1987. 1973 also saw the same action, which was worse than 1987.

The present decline will last into April. Then there will be a brief summer rally and in September-October the bottom will fall out!
http://www.theinternationalforecaste...eck.php?Id=163


Lindsey Williams phrases it this way:
There is so much to touch on regarding the dollar this month, I hardly know where to start. Regardless of where I begin, the news is not good and affects all of us.

First on our list is China. They have now announced that they are refusing to accept American Corporations purchasing into their stock market any longer as they did in the past. China also said that they are no longer going to be purchasing our securities as they have in the past, including bonds and T-bills. China's decisions and subsequent announcements at the beginning of the week has sent a panic across the World's markets.

March 21st 2007 will be one of the most significant dates this month. Iran has outlawed the American dollar and will put anyone in jail that uses it in their country after that date. They have the ominous notoriety of being the first nation in the world to do such a thing. The real issue in Iran is NOT nuclear, but rather the decision to not use the American dollar for trade and the sale of oil. On the heels of Iran's decision, North Korea has followed suit and also outlawed the use of the American dollar in their country. Finally, Malaysia the next day did the same thing.. Iran will distribute from mid-March a new banknote carrying a portrait of the leader of the Islamic revolution, Ayatollah Ruhollah Khomeini, as well as the nuclear energy emblem, the Tehran press reported Sunday.*


More mixed news on China:

Reuters Canada
By Chris Buckley. BEIJING (Reuters) - China's will boost defense spending by 17.8 percent in 2007, accelerating the emerging power's string of annual double-digit rises in money for a modern military that reflects its economic strength.
http://ca.today.reuters.com/news/newsArticle.aspx

China's Parliament To Approve Controversial Property Law
The National People's Congress spokesman Jiang Enzhu on Sunday defended the new law and said it should give "equal protection" to public and private property. "Under the socialist market economy, state, collective and private properties should be entitled to equal rights. If various property rights were not protected equally, the initiative of legally creating and accumulating wealth by the masses of people would be harmed, and national strengthen and social harmony would also be impaired," Jiang said.

"NPC members will be asked to approve a new corporate tax law that removes tax breaks for foreign firms setting up businesses in China."

[Codger]

Max
You may wish to amuse yourself by taking a look at things from a different perspective. Perhaps it'll just be a headache. :-)
All labour, all products, all intellectual production, all currencies are simply commodities that establish their values relative to each other via the normal mechanics of supply and demand. Artificial interventions by governments, monopolies of certain commodities, are always temporary. Sooner or later the artificial or contrived imbalances in relative values will be circumvented.
The greater the artificiality of a value affixed to a given commodity and the longer that that artificiality exists the greater the correction will be and rather than resting easily at it's real value it will fluctuate to either side of it's real value swinging to and fro through a few cycles until it comes to rest.
As an amusing exercise, watch the German economy while it adjusts to the recent VAT increase there.
J. Galbraith was a Canadian. Some of us dig through the navel lint of economic theory as though it were a birthright.

[airship]

I'm glad I started this thread. It's allowed lots of folk an opportunity to get stuff off of their chests...?!

But I imagine that the latest stock market tumult will have limited effects on most of the superyacht-owning fraternity. Factories and offices worldwide may well have to close. More company-funded pension plans and / or medical benefits may have to close.

But those employed on superyachts or closely-associated providers of essential services should have little to fear for some time to come.

It's when superyacht-owners start converting their superyachts to carry sails and gutting the guest accomodations in order to carry 20ft containers that we should start worrying...