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Frustrated millennials zeroing in on election housing pledges

Drew Roberts couldn’t wait to get out of Toronto.

After he and his girlfriend managed to find work in Kingston, Ont. they found the same problem: even 260 kilometres to the east, the dream of home ownership was still out of reach.

“We left Toronto in search of a more stable career in our respective fields,” said Roberts, a 32-year-old scientist. “We wanted a city with a slower pace in which we could grow our roots.”

When planning to make the move in spring of 2021, Roberts said he kept an eye on the local real estate market, but said prices had already swelled beyond their budget so they instead moved into a rental…read more.

Bonds are ‘investment garbage’ just like cash: Bill Gross

Bill Gross is talking trash about the bond market — literally.

In a meandering and sometimes off-kilter investment outlook posted on his website, the onetime bond king said longer-term Treasury yields are so low that the funds that buy them belong in the “investment garbage can.”

Ten-year yields traded at 1.29 per cent as of 6:07 a.m. in New York. They are likely to climb to 2 per cent over the next 12 months, handing investors a loss of roughly 3 per cent, he wrote. Stocks could also fall into the category of “trash” should earnings growth fall short of lofty expectations.

“Cash has been trash for a long time, but there are now new contenders,” said Gross, who co-founded Pacific Investment Management Co. in the 1970s and retired in 2019. “Intermediate to long-term bond funds are in that trash receptacle for sure, but will stocks follow? Earnings growth had better be double-digit-plus or else they could join the garbage truck.”…read more.

Canada Hid A Foreign Capital & Housing Study While Dismissing Intelligence Warnings

Canadian tax authorities confirmed they knew about illicit foreign capital inflating real estate. They first found out over two decades ago, but only confirmed it to the South China Morning Post (SCMP) this week. A whistleblowing, retired auditor first told SCMP journalist Ian Young about the report in 2016. He waited half a decade for a response from the agency, which confirmed the study took place 25 years ago. The situation shares odd circumstances with an intelligence report mentioning foreign capital and real estate, called Sidewinder. Whistleblowers allege both reports, written one year apart, were suppressed for political reasons.

In 1996, the Canada Revenue Agency (CRA) studied millionaire migrants and homeownership. The tax authority was looking into reports of mansion buyers with poverty-level incomes. Not one or two either, it was a systemic issue.

The secret report was unknown to the public until 2016, when a CRA whistleblower told the SCMP about it. At the time, he alleged the study was suppressed from above. Five years after SCMP filed a freedom of information request, the agency confirmed it does exist…read more.

Former Fed official warns of ‘urgent’ threat of another financial crisis

Investors cheered Federal Reserve Chairman Jerome Powell’s Jackson Hole speech on Friday, with markets interpreting it to mean that the central bank would not too quickly wind down its support of the economy. But not every speaker at the annual gathering gave cause for optimism.

Don Kohn, the Fed’s former vice chair for financial supervision, used the opportunity instead to warn of imminent risks to the stability of the global financial system, and called on regulators and lawmakers to take swift action to address those concerns.

“Dealing with risks to the financial stability is urgent,” he said during a speech to the Federal Reserve Bank of Kansas City’s annual Jackson Hole Economic Policy Symposium. “The current situation is replete with…unusually large risks of the unexpected, which, if they come to pass, could result in the financial system amplifying shocks, putting the economy at risk.”…read more.

Canadian economy unexpectedly contracts; dollar weakens

Canada’s rebound unexpectedly stalled through spring and early summer, raising questions about the resiliency of the nation’s economy.

Gross domestic product fell at an annualized 1.1 per cent pace from April to June, Statistics Canada reported on Tuesday, down from a revised 5.5 per cent in the first three months of the year. Economists in a Bloomberg survey were anticipating a 2.5 per cent expansion. Adding to the disappointment, economic growth fell a further 0.4 per cent in July, according to a preliminary estimate.

It’s a worse-than-expected result that may prompt analysts to reconsider how quickly the nation’s economy will be able to fully recovery from the pandemic, heightening worries about growth just as the country braces for a fourth wave of COVID-19 cases…read more.

Billionaire Paulson who shorted subprime calls crypto ‘worthless’

Ever since John Paulson bet against the U.S. housing market more than a decade ago, people keep asking him about his next big trade.

The billionaire hasn’t found anything to rival his massive short, but it’s hard to top the $20 billion that Paulson made for himself and investors when subprime mortgage bonds collapsed and ignited the worst financial crisis since the Great Depression.

Now though, more than 14 years after CDOs and credit-default swaps dominated everyone’s attention, Paulson is again seeing signs of excessive speculation.

Paulson, 65, is increasingly concerned about rising prices, he said in an episode of “Bloomberg Wealth with David Rubenstein.” The rapidly expanding money supply could push inflation rates well above current expectations, he said, and gold, which he’s backed for years, is primed for its moment.

His harshest words are for the hottest investments of this era. SPACs, on average, will be a losing proposition, while cryptocurrencies are a bubble that will “eventually prove to be worthless.”…read more.