Oil Setback Long 'n Painful

[furrowtickler]

Agreed ajl
When we look back at the past 5 years we will see a strong inflationary time here in Canada
Just think about the increase in costs from say 2008 up till Dec 2014 for
Food
Fuel
Housing
Vehicles
Machinery
All transportation - air , rail , trucking
Land - rual and urban
Labour
Some of these alone have doubled or trippled in this time period. Inflation has been starring us in the face for a while .
It may not have been an overnight issue but it has been strong and steady just under the radar, constantly.
I also agree with housing - the writing has been on the wall for two years - it is not sustainable at any level of economics - it just needed a trigger ( oil) to pop the bubble .

[farmaholic]

Sooooo, land prices will be coming down?

Oh well, it looked good on the Net Worth Statement for a while.

[fjlip]

Maybe not selling saved us from losing it on paper and in other investments. Just an imaginary number, buying power was low in inflated housing etc. Time will tell, if you have time to wait that is.

[Klause]

Last couple years all this new money poured into the economy has just been diluting value.

20 bucks an hr and a 275000 house or 40 and a 550000 house... Same thing except you have more interest costs.


People don't get it... In the depression governments print money and built things... New highways tracks bridges... dams schools hospitals. All these are real hard assets adding to the value of the country and thus it's currency.


All this money getting poured into equity markets inflates paper. It's like getting a farmer getting a 250000 cheque... If you invest it in land a tractor cattle grain bins or paying off debt it increases your net worth.


If you spend it on hookers and blow it makes you feel happy for a little while and then the money is gone and you have nothing to show for it. That's basically what governments are doing today.