I was lucky to attend the Toronto Real Estate Broker’s Breakfast recently and sit in on a presentation by Economic guru, Benjamin Tal from CIBC World Markets. He started by going through a list of economic headlines over the past few weeks... when he then interjected "GOOD MORNING", we all laughed.
Mr. Tal is one of those people that I like to follow because he is not swayed by Media sentiment and keeps things in great perspective. He sees the world economies going through a re-balancing act at the moment with some Countries becoming more consumer based than production based. Much like I have noted over the past months, where Ontario is having a benefit in Oil prices being down and Albertans are moving here looking for jobs.
He spoke of the Chinese Stock market, calling it a Casino and noting that it is just another reason for Chinese investors to move money to Toronto or Vancouver. The Torontoism team has been monitoring and has been cultivating this market as it grows in Toronto. Mr. Tal sees China normalizing and becoming more balanced in its economy.
Interestingly, he showed a graph of the Canadian dollar's descent to 70 cents and noted that most world currencies had devalued and Canada is more in the mid range than at the bottom. He blamed currency parity with the US for a loss of 10% of our manufacturing businesses and says that is why Canadian manufacturing is not picking up as it should with a low dollar.
Mr. Tal felt that a lot of people were sitting on cash and being careful about investing, however, he predicted that some of this cash would find it's way into the Real Estate market. Like Mr. Tal, I am very positive about our market, but I am always worried about the negative press that the Real Estate market can generate. For years prediction of an U.S. Style bubble has been in the headlines. We are two different countries with two different banking systems. We are not a mini U.S. and no comparisons should be made on many levels....They are lovely and fascinating people who have value systems that are so unlike ours and one only has to contrast our elections to understand. We are really so much more British than we are American! "Vive la difference!"
Title Photo by TREB