Commercial Real Estate

The Uncomfortable Truth About The Great Boom And This "Recovery"

Despite such endless financial engineering, sales for the S&P 500 have been declining for the last three quarters. And profits have declined for the first time since the 2009 expansion. Simply put: The recovery is a mirage... It isn’t real... And it isn’t sustainable.

"Canadians Should Be Concerned" As Energy Sector Job Losses Spike To 100,000 This Year

It's grim up north... and getting grimmer. Amid soaring suicide rates, Canada's once-booming oil patch is rapidly accelerating its downward trajectory. "Canadians should be concerned in times like these," warned Tim McMillan, president and chief executive of the Canadian Association of Petroleum Producers, noting that the oil and gas sector will see 100,000 job losses by the end of this year. Apart from the protracted price declines, Alberta’s oil and gas sector has also had to contend with a 20 per cent hike in corporate taxes, increased provincial royalties, a carbon tax and new regulatory policies to limit rein in carbon emissions... and now a new competitot from US exports.

Obama Abruptly Waives 1980 Foreign Investment in Real Property Tax Act

FIRPTA was implemented during a better era for Americans in response to international investors in the late 1980s and early 1990s buying U.S. farmland, as well as the more publicly visible buying of trophy U.S. property by the Japanese.  The US government has now expediently waived FIRPTA.

Weekend Reading: All About Janet

"In a worst case scenario, the real economy effects of the oil sector and the earnings slowdown hit the frothy commercial real estate and REIT sector, which in turn begin the widening of the contagion begun by energy high yield. Combine this with the sudden stop to lower quality energy credits I believe is inevitable and you likely have stall speed – or even recession. And that’s where subprime auto ABS, student loan securitization and US munis come into the picture for the US domestic economy. Those markets get hit in recession."

Suicides In Alberta Soar In Wake Of Canada's Oilpatch Depression

The suicide rate in Alberta has increased dramatically in the wake of mounting job losses across the province. According to the chief medical examiner's office, 30 per cent more Albertans took their lives in the first half of this year compared to the same period last year. "This is staggering," said Mara Grunau, who heads the Centre for Suicide Prevention.  "It's far more, far exceeds anything we would ever have expected, and we would never have expected to see this much this soon."

Deutsche Bank Warns Bonuses Will Be Slashed As Much As 30%

A beleaguered Deutsche Bank is set to slash the investment bank bonus pool by some $566 million as John Cyran's effort to right a sinking ship continues. As Bloomberg reports, "no decision has been taken and the biggest reductions are likely to impact employees in the fixed-income business. Some managing directors may have their entire bonus scrapped, according to the person."

Boomer Doomer - The Other Side Of High Rents

Rising rents have been cited as a reason millennials aren’t moving out of their parents’ basements. But higher rents could force some boomers to move in with their children... it is shaping up to be a crisis for some boomers for the following reasons...

Vitaliy Katsenelson's picture

Shadow Over Asia

Having government control over the levers of the economy can have advantages. For example, by taking prompt action, the Chinese government was able to pull the economy out of the recession remarkably fast, basically by fire-housing the stimulus package that was equivalent to 12% GDP. That’s the advantage. The only problem is that these kinds of short-term advantages come with long-term, painful consequences.

Frontrunning: September 22

  • Pressure builds on Volkswagen CEO as emissions-cheating probe spreads (Reuters)
  • Volkswagen Emissions Scandal Relates to 11 Million Cars (WSJ)
  • Volkswagen Emissions Investigations Should Widen to Entire Auto Industry, Officials Say (WSJ)
  • Germany's Bosch makes VW's U.S. diesel components (Reuters)
  • Volkswagen scandal will have personnel consequences - state economy minister (Reuters)
  • Glencore Falls to Record as Mining Shares Lead Stock Losses (BBG)
  • Despite Slump, China’s Xi Jinping Pledges Economic Reforms (WSJ)

Inside Ground Zero Of Canada's Recession

In the past year, we have extensively profiled the collapse of ground zero of Canada's oil industry as a result of the plunge in the price of oil. Since then it has only gotten far worse. As Mark Thornton of the Mises Institute points out, in a report from the Financial Post shows that Calgary in Alberta Canada now has 1.7 million square feet of empty office space, the most in North America with another 5.2 million under construction! But that's just the beginning, because for many recent millionaires, the real cash crunch has finally arrived which means business is thriving for at least one industry: pawn shops.