Mar 162017

The New Land of Opportunities is Cold, but Friendly

Many Americans want nothing more than to have the equal opportunity to achieve success and prosperity through hard work, determination, and sheer sticktoitiveness. 🙂 But research from the Pew Research Center suggests that there is a growing gap between the country’s rich and poor. As the middle class gets squeezed it is becoming harder for people to realize their dreams. Some consumers in the lower class are in so much financial distress, they can’t even afford to pay their electricity bills. Excuse the pun but these could very well be the darkest times of their lives, literally.

But there is a silver lining to all this. According to Scott Gilmore, a columnist for Macleans magazine, Canada is a better place than the United States to find life, liberty, and the pursuit of happiness by virtually every measure. 🙂 So maybe the American dream hasn’t died. It just moved north.

Canadians are more likely to have college degrees, be employed, own a home, take more vacation days, and even live longer than our neighbours to the south. 🙂 Scott says one contributing factor to a better life in Canada is thanks to our more affordable, public healthcare system. We don’t have people here going bankrupt because of medical bills. We may have to wait longer than Americans to get treatment. But at least Canadians are less likely to take extreme measures to pay for high healthcare expenses.


Economic mobility is also higher in Canada. According to Scott, Canadians are twice as likely to move from the poorest quintile of the population to the wealthiest quintile compared to Americans. Similarly, the link between the income of a parent and a child is half as strong in Canada. In other words, individuals have more influence over their future outcomes than the environment they are born into. 🙂 Canadians are also 6 times less likely to be incarcerated.

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Mar 022017

I’ve been saying for years that real estate prices in Canada are not that high. Certain areas like Vancouver and Toronto have the perception of being unaffordable. But the fact that population growth is still positive in these major cities suggests otherwise. If these places weren’t affordable then people would be moving out of them, not in. 🙂

People from all the world have wants. These wants turn into demand, which fuels certain parts of the economy. And what do young adults want right now? According to an HSBC survey, the “vast majority” of millennials want to buy property.

Demand from Young People 

HSBC bank polled 9,000 people from 9 different countries: Canada, Australia, China, France, Malaysia, Mexico, the UAE, the U.K. and the U.S. The results include some interesting numbers about the housing market among individuals between ages 18 and 35, which the bank defines as millennials.

37% of millennials said they had financial help from the bank of mom and dad to cover their housing costs. Canada is roughly in the middle of this trend.

A little over a third of Canadian millennials polled already owned their own home, and among those who didn’t, 82% say they intend to buy one within the next 5 years. Thus, housing must be relatively affordable, because even at the lowest earning stage of their careers, most people either already own property, or have the means to own in the foreseeable future. They are also willing to sacrifice a lot in order to become homeowners.

The results of the HSBC study shows that Canadian real estate may not be in a bubble. Funeral costs, health care costs, and tuition have also grown at a faster pace than inflation over the decades, but most people don’t label those sectors of the economy as becoming a bubble. So I don’t think housing is overpriced either.

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Nov 102016

What Canadians Need to Know About America’s Next President

People from all around the world were anxious going into the 2016 U.S. presidential election. Sometimes it felt like the two frontrunners were throwing more shade at each other than discussing real issues that actually matter.


Some pundits warned that if Donald Trump becomes the next president, there will be hell toupee. 😄 In the end, Trump won and will become the 45th U.S. president. And since he is replacing Barack Obama, I guess you can say that orange is the new black. 😀


But before anyone freaks out, I don’t think Donald Trump will ruin the economy like some critics say he will. It’s important to put things into perspective. So here are some things to consider for Canadians about our finances and investments in the short to medium term. 🙂

Donald Trump on Canada/U.S. Trade

We know that Donald is willing to be protectionist in order to create more jobs for Americans. He also wants to renegotiate NAFTA. But this shouldn’t have any large impact on trade between our 2 countries. Scott Sinclair, a senior researcher with the Canadian Centre for Policy Alternatives says that “most of Canada’s free trade with the United States is locked in through World Trade Organization (WTO) rules, and doesn’t apply to NAFTA. Furthermore, anti-trade policies will also hurt the U.S. economy. Just compare the living standards of insular versus free-trade countries around the world. Since Donald will be judged, at least in part, by the performance of the economy, I don’t expect any drastic changes to Canada/US trade agreements. I also think programs like NEXUS aren’t going anywhere. Cross border shopping has way more benefits than drawbacks for the U.S.

Donald’s anti free-trade position seems to be more about an anti-Mexico sentiment, so I don’t think he’s out to purposefully tarnish the relationship between Americans and Canucks. But if he does impose new tariffs on goods moving across our border, then the impact to Canadians will depend on where we live. About 50% of trade in British Columbia is now done with countries other than the U.S. It has been a deliberate effort of the provincial government over the past 12 years to divest away from Canada’s largest trading partner. However, 80% of Ontario’s trade is with the U.S. so people in Ontario will be hit harder. Alberta’s trade is nearly all dependent on the U.S. The province has diversified its economy over time, but it’s still heavily dependent on oil and gas today. Donald wants to ramp up fossil fuel production in the U.S. which would likely keep energy prices lower for longer. Trade is only a part of the much larger economy. But it would be prudent for Albertans to prepare for an extended recession just in case. 🙁

Currencies and Interest Rates

Our loonie will likely stay lower for longer if the U.S. doesn’t import as much Canadian goods anymore. The value of a country’s currency depends on how productive its people are. Less trade with the U.S. means slower economic growth for Canada. This is also why the Mexican Peso dropped 10% after the election. But a lower Canadian dollar may actually help us gain back some manufacturing jobs, and make it more profitable for exporters to sell their goods. This boost in tourism and exports could make up some losses from any negative anti-trade effects. The FED in the U.S. may also take longer to increase its country’s interest rates.

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Oct 242016

 What $300,000,000,000,000 Look Like

All $ amount in today’s post is in US dollars.

What would you buy if you had all the money in the world? According to British news site The Independent, the total amount of financial assets in the world is around $300 trillion. This is the total value for all the equities and fixed income, including company shares and both private and government bonds, plus all the other securities we can invest in. This $300 trillion does not include real estate or any derivatives.

If we had $300 trillion all in $5 bills and laid them out on the ground in a single layer, they would take up about as much space as all of Alberta.


If we had a way to stack all these $5 bills one on top of another, the stack would measure 1.6 million km or 1 million miles high! Wow. That’s literally out of this world. 😀 That’s enough distance to cover a round trip to the moon and back, twice! By the way, have you guys heard about the new restaurant on the moon? The food isn’t bad. But there’s no atmosphere. 😄

Anyway, let’s take a look at how the allocation of financial assets in the world has changed over time. According to the MarketWatch chart below, it appears every type of asset class has become more valuable since 10 years ago.


As we can see, the stock market is the most volatile. Stocks lost nearly half of their global value during the financial crisis of 2008. However the graph also shows that equities do recover over time. This is why we should not sell our stocks in a bear market. In fact, lower asset prices may present an opportunity to average down and buy more stocks. 🙂

We can also see that the allocations haven’t changed much over time, with the exception of public debt securities. A lot of demand for public debt comes from Central Banks as they attempt to stimulate the economy. The act of quantitative easing creates trillions of dollars of wealth, but disproportionately benefits investors. That’s why the value of financial assets since 2008 has increased tremendously, but average income in the U.S. has not. Instead of working hard to get ahead, many investors like myself have increased our wealth by simply riding on the backs of central bank policies.


Central planners around the world will likely continue to print money for the foreseeable future. As the global population ages we can expect even more demand for fixed income securities. Dividend paying stocks will also be popular as investors look for higher yielding alternatives to bonds. The total value of financial assets in the world should continue to increase going forward.

$300 trillion divided by 7.5 billion people who are alive today means each person’s fair share is $40,000. This means accumulating $400,000 of financial assets would give us 10 times what the average person has. This is a respectable level of financial stability that can cover years of living expenses in case of long term unemployment or disability. Having $800,000 in financial assets represents 20 times the average. This would be enough for one person to claim financial independence, assuming the person knows how to manage his or her finances properly. 😉

Random Useless Fact:


Aug 252016

Many entrepreneurs choose to go into the restaurant industry these days, and for good reason: it’s attractive, people always need to eat, and the prestige of having a reserved table can sway more than you think. So for all those restaurant entrepreneurs: you’re running a successful business, and have enjoyed a steady stream of loyal clientele, but when was the last time you implemented specific strategies to improve your profitability? Consider the following tips to make sure your restaurant excels and profits rise in the coming months!

  1. Boost Alcohol Sales

Profits made from alcohol sales make up a bulk of restaurant revenue, and if you’re not currently offering alcohol on the menu, or only offering wine and beer, you may be missing out on a huge stream of income. If you are looking to capitalize on alcohol sales, make sure you have a license that will allow you to serve exactly what guests are looking for. If you currently have a limited permit, check out determine whether the investment in a full license may be worth the expanded inventory you can offer to alcohol-drinking patrons. If you already serve a bevy of liquors, spirits, beer, and wine, train your staff to upsell alcohol sales. It could be suggesting wine-by-the-bottle sales instead of by the glass through too-good-to-pass-up bottle discounts.

  1. Improve Weekday Sales

Most restaurant sales occur during the weekend—just two days out of a seven-day week. If you want to make your restaurant more profitable, attracting a weekday crowd is essential. There are a variety of ways you can draw in after-work patrons depending on your neighborhood and target demographic. If you’re looking to attract young professionals, host events like trivia and singles nights where neighbors can come in and meet new people. Drink specials can do wonders for drawing a boisterous happy hour crowd, and offering daily food specials can see guests clamoring to get in and try the new recipe before it’s gone tomorrow. Also be sure to ramp up your social media efforts; offer daily discounts for fans, and see more patrons come flowing in—it’s truly as simple as a few dollars off on Tuesdays.

  1. Offering Events

As aforementioned, hosting events in your restaurant is sure to bring in more customers, and see you finding your profits exponentially increased within a few weeks’ time. Many restaurants have gotten into the trend of trivia nights, during which locals can come out and prove their wit and knowledge with some fun, often themed questions. There are numerous local companies in almost every major city that will come in and host the night for you; they take a portion of the profits and you find a packed restaurant on a night when you might have otherwise only see a slow trickle of guests. You might also choose to take advantage of a company that will host painting sessions. Guests come in, follow an instructor’s painting lesson, and can choose to order food and drinks from a menu during the multiple hours they practice their brushstroke—rest assured nine times out of 10 a guest will take advantage of grabbing at least an appetizer and a glass of wine. Now multiply that by say, 30 guests, and you’ve got yourself a handsome profit.

  1. Excel at Customer Service

Dining out is about more than the food, it’s about the experience. The huge make-or-break factor behind an experience? The customer service. You may serve an excellent menu, but if your wait staff is underperforming, the food is getting delivered to tables late, and guests consistently complain about wait times, you’ll find your profits taking a nosedive immediately. Make sure you always have enough staff on hand to reduce waiting time, train new staff extensively to ensure their performance is up to par with your and your customers’ expectations, and always be sure to take customer complaints seriously.

  1. Offer Delivery

We’re a nation of convenience, and takeout these days is appealing to busy individuals and families who don’t want to spend the time grocery shopping and cooking after a long day of work. Offering delivery sets you apart from competitors, and will endear your restaurant to patrons to secure better customer retention. Prepare a separate takeout menu if you won’t be able to offer all of your menu items, be sure to schedule the right workers appropriately, make sure you’re covered with the right liability insurance, and be sure to work with great POS software like that from