I've watched several videos about Canada and people are complaining about how high the rents are. Even the actual Canadians that sees that there's something wrong and cope up with the situation are leaving.
I guess that each country has the same problem as them but it's just more vulgar since it's their citizens that are putting it up on the internet and it cannot be hidden.
Even in the nearby provinces, there have been some videos I've seen that they're also starting to get up. But I haven't got a clue, got some people that I know personally there that stays and not telling a single thing about the situation there. Well, they're just there for work so maybe that's it and they can still keep up with the inflation.
Topic: How do we profit from Canadian recession? (Read 240 times)
The mortgage market in Canada is nothing like the USA. We don’t have fixed 30 year rates. We got basically variable or fixed up to 5 years. Generally most go for 3-5 year fixed.
So pretty much the same as UK, although here, 2-year option was the most popular, but when the rate-hikes started, things got a bit weird and the 5-year fixed had actually lower rates than the 2-year.
Those that are in pain are those that chose 5 year variable because their payments might of doubled.
That's what happened in my native Poland where most mortgages are at variable rates. Things were really ugly.
And those that were smart are still in fear because when they renew they won’t get their 1.5% rate anymore but instead will get a 6% rate.
Not much anyone can do about that, other than re-pay as much as possible at lower rates, which is not necessarily good advice though if have savings/bonds options available that could pay above the 6%.
And the high rates are not all that scary if wages increase at the same (or higher) rates. The real problem is the insanely high house prices.
Housing is so expensive there that a small 25bps hike can have huge consequences for many home owners. And if they are not home owners they are landlords which just pass on these costs to the tenants.
What's the mortgage market like in Canada? Is it similar to the US where the vast majority of mortgages have a fixed rate throughout the entire period of the mortgage, or is it more like in the UK where the most popular ones are either 2 or 5 years fixed? Or maybe it's more like in some EU countries where most buyers would be on variable rates (which is insane, if you ask me)?
The mortgage market in Canada is nothing like the USA. We don’t have fixed 30 year rates. We got basically variable or fixed up to 5 years. Generally most go for 3-5 year fixed.
Those that are in pain are those that chose 5 year variable because their payments might of doubled. And those that were smart are still in fear because when they renew they won’t get their 1.5% rate anymore but instead will get a 6% rate.
It would of been one thing if these houses were affordable but I am talking about $750K mortgages which is the average home right now in Canada.
You can invest in TSX stocks for the long term because people who continue to invest for the long term will profit after coming out of the recession.
Yes, investing in stock is good for long-term investment like other reach people did. But, you must specific, what stock you want to invest in. If I have money and live in Canada, I would buy Air Canada stock. I read that article about how good aviation stock in the future. in my country, there are several people getting rich by investing in aviation stock. Maybe is not much, but the growth of the aviation business is gradually growing after covid-19. As we can see today how many people traveling by plane between countries, which I think buying Air Canada stock is quite potential for get profit on future.But I don't understand why we should seek to invest in Canada just because that country is in recession? When it comes to stocks, we have thousands of good tokens to invest in, especially tech stocks with a good history of growth. As for real estate, it's even more impossible because we don't live there, and don't know exactly what the situation is like there. Following media news is not enough information to invest.
In short, the end goal is still profit, while if we have good knowledge and only focus on a market like cryptocurrencies, we can make a profit, no need to waste time researching something we don't often learn about. Unless OP is living in Canada.
You must have good capital and the patience to continue and buy more shares with every decline. Of course, the shares will continue to fall and you will think that you are a loser, but in the end, after the recession ends, the shares will rise again and you will get big profits.
Thanks for your input, but, as stated in the OP, I was talking about a more conventional approach, i.e. shorting the assets that you expect to go down, rather than buying them, losing money and hoping they'll go back up at some point in the future.
And no, you don't need a massive capital for that. You could just play with whatever you have available.
Of course, whether you already own the assets or not, you do not need a large capital if you want to take the short sale option instead of risking waiting and losing the value of the shares.
However, if you like risk and have enough money you can follow both approaches, short selling assets that you expect will actually fall in value in the short term, and buying depressed stocks of companies that you expect will rise in value in the future in the long term.
You can invest in TSX stocks for the long term because people who continue to invest for the long term will profit after coming out of the recession.
Yes, investing in stock is good for long-term investment like other reach people did. But, you must specific, what stock you want to invest in. If I have money and live in Canada, I would buy Air Canada stock. I read that article about how good aviation stock in the future. in my country, there are several people getting rich by investing in aviation stock. Maybe is not much, but the growth of the aviation business is gradually growing after covid-19. As we can see today how many people traveling by plane between countries, which I think buying Air Canada stock is quite potential for get profit on future. You must have good capital and the patience to continue and buy more shares with every decline. Of course, the shares will continue to fall and you will think that you are a loser, but in the end, after the recession ends, the shares will rise again and you will get big profits.
Thanks for your input, but, as stated in the OP, I was talking about a more conventional approach, i.e. shorting the assets that you expect to go down, rather than buying them, losing money and hoping they'll go back up at some point in the future.
And no, you don't need a massive capital for that. You could just play with whatever you have available.
If you want to benefit from the recession, you must first have good capital, and it is better to have more than one source of income, secondly, you must take risks, and thirdly, you must be patient in the long term.
You can invest in TSX stocks for the long term because people who continue to invest for the long term will profit after coming out of the recession.
You must have good capital and the patience to continue and buy more shares with every decline. Of course, the shares will continue to fall and you will think that you are a loser, but in the end, after the recession ends, the shares will rise again and you will get big profits.
You can invest in TSX stocks for the long term because people who continue to invest for the long term will profit after coming out of the recession.
You must have good capital and the patience to continue and buy more shares with every decline. Of course, the shares will continue to fall and you will think that you are a loser, but in the end, after the recession ends, the shares will rise again and you will get big profits.
Housing is so expensive there that a small 25bps hike can have huge consequences for many home owners. And if they are not home owners they are landlords which just pass on these costs to the tenants.
What's the mortgage market like in Canada? Is it similar to the US where the vast majority of mortgages have a fixed rate throughout the entire period of the mortgage, or is it more like in the UK where the most popular ones are either 2 or 5 years fixed? Or maybe it's more like in some EU countries where most buyers would be on variable rates (which is insane, if you ask me)?
One of the biggest economies globally, it's true but best or most healthiest, I am unsure about it.
Canada is like other big nations, have very unhealthy economies but it is better than the United States and some other big nations.
~snip~
Canada is like other big nations, have very unhealthy economies but it is better than the United States and some other big nations.
~snip~
All large countries are more or less affected by the recession as a result of what happened during the pandemic, but also years before - the debts simply came due. Here in Europe, it is not at all popular to talk about Germany being in trouble, because everyone knows what that means for the EU, not to mention the members called PIGS (Portugal, Italy, Greece, Spain) that the ECB has been saving for years and with which a lot other members are not satisfied.
I can only talk about it from what I read, and considering that a lot of tourists from the EU were in my country like every year, most of them complain about the prices and that it is not the same as before - but is it something new that already didn't we know? What I hear these days is that some countries will soon be hit by a new wave of price increases, because the summer was terribly hot in Europe with a lot of destructive storms, and producers will use every excuse to raise prices.
Today we had basically 2 premiers of the 2 provinces which have the largest housing bubbles basically writing a letter to the bank of Canada, begging not to raise rates next week.
Rates weren’t going to get raised anyways. But the fact that they wrote this letter and posted it publicly shows you how bad it is in those provinces.
Housing is so expensive there that a small 25bps hike can have huge consequences for many home owners. And if they are not home owners they are landlords which just pass on these costs to the tenants.
Rates weren’t going to get raised anyways. But the fact that they wrote this letter and posted it publicly shows you how bad it is in those provinces.
Housing is so expensive there that a small 25bps hike can have huge consequences for many home owners. And if they are not home owners they are landlords which just pass on these costs to the tenants.
This means people will spend less money which is why properties will be hit hard
This could happen but is not a rule. It's possible that properties could keep going up despite the recession. Depends on the specifics of the market and whether it's dominated by regular buyers or investors.
and usually before recession happen there is a high inflation rate
Again, we could have a recession accompanied by high inflation, but usually economy slowing down would have the opposite (deflationary) effect. People spending less means lower inflation.
Canada has one of the most at risk housing bubbles currently. And a large portion of Canadians gdp is tied to real estate. Instead of investing in tech and other sectors they just concentrated on real estate.
And you can see what is happening. Millions of new immigrants but the gdp fails to go up, doesn’t make sense and the previous gdp numbers were revised.
You got people crying on TikTok because they paid $20 for grapes and people who can’t afford to buy their kids school supplies. It’s not looking good.
And you can see what is happening. Millions of new immigrants but the gdp fails to go up, doesn’t make sense and the previous gdp numbers were revised.
You got people crying on TikTok because they paid $20 for grapes and people who can’t afford to buy their kids school supplies. It’s not looking good.
I don't really agree with some of this speculations, because the Canadian economy is still one of the best in the world, as even more U.S citizens prefer to migrate to Canada due to how favourable it is over there.
One of the biggest economies globally, it's true but best or most healthiest, I am unsure about it.Canada is like other big nations, have very unhealthy economies but it is better than the United States and some other big nations.
Gross Public Sector Debt as a Proportion of GDP in a global map or you can click on Table tab to see it in a table, sort it ascending or descending or click on this to get its table
Quote
Country or region percent 1995 2021
Greece 0.00% 207.77%
Italy 117.70% 146.00%
Cyprus 0.00% 139.35%
Portugal 0.00% 129.97%
United Kingdom 43.25% 112.48%
United States 54.68% 109.32%
Spain 51.36% 106.06%
France 0.00% 96.69%
Sri Lanka 2010 69.61% 94.28%
Belgium 116.60% 91.41%
Saint Lucia 2006 0.00% 2020 81.58%
Mauritius 1999 0.00% 79.42%
Austria 0.00% 76.24%
Hungary 83.53% 75.37%
Slovenia 0.00% 73.62%
Iceland 0.00% 73.14%
Croatia 22.18% 73.12%
Brazil 0.00% 71.82%
South Africa 0.00% 68.52%
Slovakia 0.00% 62.95%
Finland 0.00% 58.95%
Ireland 77.49% 55.88%
Malta 2000 60.64% 55.17%
Poland 0.00% 53.70%
Canada 56.90% 50.56%
Latvia 0.00% 49.12%
Romania 0.00% 47.57%
Germany 0.00% 46.29%
South Korea 0.00% 45.78%
Czechia 0.00% 43.56%
Lithuania 0.00% 42.77%
Turkey 1998 0.00% 42.43%
Australia 4.38% 39.75%
Indonesia 0.00% 38.33%
Mexico 0.00% 37.29%
Peru 2007 0.00% 33.11%
Denmark 0.00% 29.93%
Norway 0.00% 26.65%
Sweden 75.41% 24.57%
Luxembourg 0.00% 23.46%
Bulgaria 0.00% 21.97%
Estonia 0.00% 17.69%
Russia 2003 0.00% 2020 16.75%
Switzerland 19.39% 13.73%
Seychelles 2014 67.20% 0.00%
Greece 0.00% 207.77%
Italy 117.70% 146.00%
Cyprus 0.00% 139.35%
Portugal 0.00% 129.97%
United Kingdom 43.25% 112.48%
United States 54.68% 109.32%
Spain 51.36% 106.06%
France 0.00% 96.69%
Sri Lanka 2010 69.61% 94.28%
Belgium 116.60% 91.41%
Saint Lucia 2006 0.00% 2020 81.58%
Mauritius 1999 0.00% 79.42%
Austria 0.00% 76.24%
Hungary 83.53% 75.37%
Slovenia 0.00% 73.62%
Iceland 0.00% 73.14%
Croatia 22.18% 73.12%
Brazil 0.00% 71.82%
South Africa 0.00% 68.52%
Slovakia 0.00% 62.95%
Finland 0.00% 58.95%
Ireland 77.49% 55.88%
Malta 2000 60.64% 55.17%
Poland 0.00% 53.70%
Canada 56.90% 50.56%
Latvia 0.00% 49.12%
Romania 0.00% 47.57%
Germany 0.00% 46.29%
South Korea 0.00% 45.78%
Czechia 0.00% 43.56%
Lithuania 0.00% 42.77%
Turkey 1998 0.00% 42.43%
Australia 4.38% 39.75%
Indonesia 0.00% 38.33%
Mexico 0.00% 37.29%
Peru 2007 0.00% 33.11%
Denmark 0.00% 29.93%
Norway 0.00% 26.65%
Sweden 75.41% 24.57%
Luxembourg 0.00% 23.46%
Bulgaria 0.00% 21.97%
Estonia 0.00% 17.69%
Russia 2003 0.00% 2020 16.75%
Switzerland 19.39% 13.73%
Seychelles 2014 67.20% 0.00%
I don't think that properties will be hit. These mass migration to Canada from all over the world which has increase the prices of apartments and airbnb. So even if the locals cannot afford it due to the recession, the migrants would.
First What happened in recession? "During a recession, the economy shrinks because of pullbacks in economic activity, especially consumer spending and business investment. Companies lay off workers and slow hiring, unemployment rises and wage growth stalls" - https://www.usatoday.com/story/money/economy/2023/06/05/what-happens-in-a-recession/70237317007/
This means people will spend less money which is why properties will be hit hard and usually before recession happen there is a high inflation rate and the central bank will raise the interest rate and built property is use lot of money and when the interest is high the property price would high
Short term is domino effect
Not entirely sure who that tweet is from, and just a reminder for everyone that just because a Twitter/X account is verified it doesn't mean they are already professionals or relevant as the blue verification mark can be bought with a premium subscription now, I wouldn't worry much about this tweet unless a major website or news site that deals with world economic information states it.
I posted a link to the tweet below the snippet. I haven't been following that guy so can't say if he's credible, but I don't subscribe to the opinion that only "professionals" or mainstream media should be trusted, as in recent years they were proven to be easily corruptible.
As for how we will profit from it, we have to see first if this is true and how the market will actually go to make a definite decision.
The idea is to make a move before it's obvious what's really happening to everyone else. By then, it would be too late.
The only way to profit from a recession is to wait for the asset prices to drop and then start buying.
That's more of profiting from recovery, as you profit when prices bounce back up. And for that, you'd have to have a lot of cash available, meaning you'd need to exit your positions at the right time.
What is really going on with Canada? Is it really that bad as the internet says?
If so, what's the best way to profit from the (alleged?) recession? Shorting CAD, TSX, or both? Or maybe it's all already priced in?
If so, what's the best way to profit from the (alleged?) recession? Shorting CAD, TSX, or both? Or maybe it's all already priced in?
Better ask advice from the people around here who shortened the Euro when it was 'collapsing" against the dollar going below 1:1 thinking it will to half of that as Europe burns in flames! It was an enjoyable topic about doom and gloom that of course turned empty when the loom and doom didn't materialize.
That guy on Twitter is just posting clickbait and rage bait material, an easy way of gaining an audience, there are millions of people in this world who just love negative stories, they want economies to collapse, and they want to see lives ruined, feeding them with stories about crashes and so on guarantees you a bunch of die-hard followers.
Now looking at this from a realistic point of view, are you seriously going to look for advice here where there is one Canadian in a thousand users and the majority have not one clue about the state of the economy? Short the CAD for what, it was 0.8 in 1990 it peaked at 1:1 in 2011 and it's 0.74 now, you really want to dump that much into this or risk a ton on high leverage for, what returns?
I live here and it depends what province you live and whether you are a home owner or not. The biggest issue is most of the population of Canada lives in either Vancouver or Toronto (or surrounding area) and these two in the past couple of years had crazy rent prices. We had large immigration recently and it only made it worse.
And you're going to get more if that student loophole isn't fixed, not even counting the 1 million that somehow were forgotten in the statistics, if you're building 1/10 of the homes needed by that immigration wave expect the prices to go up till something fixes it, either business moving out of to more affordable places along with the workers or new cities taking the initiative and start building to keep up with the demand.
Currently, almost all world economies are in difficult conditions, this is unavoidable for Canada and other countries. this situation is not something that has never happened before, for example the covit 19 pandemic a few years ago, where the incident has devastated the world economy, here it is very important to maintain a long-term perspective when considering the impact of a recession on certain countries, such as Canada is one of the countries that has a lot of natural resources, Canada's economy is closely related to each other with the US where they have long been cooperating both in terms of savings and loans and export imports, as we all know today the US economy is the mecca of the world's global economy,
It is very easy for those who have abundant money to be able to multiply the assets they have, including buying real estate, gold, even BTC, but for those who have mediocre assets saving is one way to maintain depreciation the assets they have, because the impact of this recession is very large where every country that is being hit by a recession can result in a reduction in people's purchasing power for certain products, be it from industry, trade, services or transportation, this is due to the slow pace of economic turnover in and abroad, of course this is very worried about by all groups, even though it did not last long, the consequences that were caused were extraordinary,
If you want to take advantage of this phenomenon, I think buying assets that have high selling power in the future is the right decision, of course this is not as easy as turning your palm, because the profits to be earned must go through a process and a period of time the long one.
It is very easy for those who have abundant money to be able to multiply the assets they have, including buying real estate, gold, even BTC, but for those who have mediocre assets saving is one way to maintain depreciation the assets they have, because the impact of this recession is very large where every country that is being hit by a recession can result in a reduction in people's purchasing power for certain products, be it from industry, trade, services or transportation, this is due to the slow pace of economic turnover in and abroad, of course this is very worried about by all groups, even though it did not last long, the consequences that were caused were extraordinary,
If you want to take advantage of this phenomenon, I think buying assets that have high selling power in the future is the right decision, of course this is not as easy as turning your palm, because the profits to be earned must go through a process and a period of time the long one.
What is really going on with Canada? Is it really that bad as the internet says?
If so, what's the best way to profit from the (alleged?) recestision? Shorting CAD, TSX, or both? Or maybe it's all already priced in?
https://twitter.com/Tablesalt13/status/1697625004764955134
If so, what's the best way to profit from the (alleged?) recestision? Shorting CAD, TSX, or both? Or maybe it's all already priced in?
https://twitter.com/Tablesalt13/status/1697625004764955134
I don't really agree with some of this speculations, because the Canadian economy is still one of the best in the world, as even more U.S citizens prefer to migrate to Canada due to how favourable it is over there. if the economy is that gloomy maybe we would have seen more outcry but wanting to Equate it to that of third world country, is something I will find it had to agree.
There is really no specific way to benefit in a recession, because it comes very hard on your pocket. Economists always find it hard to deal with recession, because it comes with inflations and other multiplier effect on the economy.
But you do well, to invest in Bitcoin, and also you could diversify your source of income, just so that you can beat the recession.
I think only way to profit in any recession is always to buy a chunk of things everywhere. Like real estate always gives you good profit if bought in tough times. Infact better would be to buy these real estate from bank auctioneer. In these cases you can buy at a even lesser price and I have heard most of the millionaires are made during recession times.
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