2022 CPC Leadership Discussion: Et tu Redeux

[Good2Golf]

I can’t dictate if you feel good or bad about it. Just an observation on how we were in a real estate bubble. Rates were were going go up at some point. Inflation or not.

I’m sure inflation as a whole doesn’t help though.

I get it. I was just being all cranky pants, because I was COVID-downsized/pink-slipped and inflation kicks a fixed-income square between the uprights when one still has a not insignificant mortgage. A loaf of bread being $0.40 more than ‘back in the good ole days’ is the least of my and I’m sure many others’ issues where “CPI inflation” is just a number and real inflation is a lot more of ‘an impactful number.’

 

[IKnowNothing]

You don't get to decide what 40 cents means to someone else. You also don't get to decide that they can suffer that additional cost with no issues.

Peoples personal financial situation will dictate that.

It's funny. My emotional/intellectual response to that brings out both the "right" and "left" of my upbringing, and it very much depends on my subjective assessment of people's personal financial situation.

On one side, extremely sympathetic to people that legitimately can't make ends meet and have no where to turn. In favour of government intervention to help those people, including paying higher income tax to do it.

On the other, I was raised by parents that made personal sacrifices to support us kids and our dreams. We didn't do without, but second hand skates were the norm, never owned a remotely new car, McDonalds was a treat. We stretched a dollar for all it was worth, and long-term financial responsibility and contingency planning were paramount. I don't know how to put it undickishly, so here it is- there's a lot of middle and upper middle class people that were living at the absolute pinnacle of a means only allowed by freakishly cheap money that I can't feel sympathy for. Tighten the belt. Make adjustments.

 

[Good2Golf]

On the other, I was raised by parents that made personal sacrifices to support us kids and our dreams. We didn't do without, but second hand skates were the norm, never owned a remotely new car, McDonalds was a treat. We stretched a dollar for all it was worth, and long-term financial responsibility and contingency planning were paramount. I don't know how to put it undickishly, so here it is- there's a lot of middle and upper middle class people that were living at the absolute pinnacle of a means only allowed by freakishly cheap money that I can't feel sympathy for. Tighten the belt. Make adjustments.

Thankfully I’m not quite at reliving my childhood by drinking powdered milk again…mmmm, warm with pockets of dusty calcium goodness…

 

[Halifax Tar]

It's funny. My emotional/intellectual response to that brings out both the "right" and "left" of my upbringing, and it very much depends on my subjective assessment of people's personal financial situation.

On one side, extremely sympathetic to people that legitimately can't make ends meet and have no where to turn. In favour of government intervention to help those people, including paying higher income tax to do it.

On the other, I was raised by parents that made personal sacrifices to support us kids and our dreams. We didn't do without, but second hand skates were the norm, never owned a remotely new car, McDonalds was a treat. We stretched a dollar for all it was worth, and long-term financial responsibility and contingency planning were paramount. I don't know how to put it undickishly, so here it is- there's a lot of middle and upper middle class people that were living at the absolute pinnacle of a means only allowed by freakishly cheap money that I can't feel sympathy for. Tighten the belt. Make adjustments.

I don't think there is anything left or right about it. A good portion of the country is having a hard go and it's probably going to get worse for lots.

And these people will look to the political class for answers and help.

Telling them to harden and suffer more, it's probably your fault anyways, won't win anyone any affection.

 

[IKnowNothing]

A good portion of the country is having a hard go and it's probably going to get worse for lots.

It's going to get objectively worse for almost everyone. For some it is and will be a hard go, for some (many) it will be choosing between relative luxuries.

 

[Halifax Tar]

It's going to get objectively worse for almost everyone. For some it is and will be a hard go, for some (many) it will be choosing between relative luxuries.

I can't blame people for playing the game in the rules that exist.

I will blame business and banks for knowingly letting people over extend themselves for profits sakes.

 

[Brad Sallows]

Business and banks worth within rules set by politicians, and governments don't very often cut business and banks the kind of breaks that governments cut for themselves when a supreme f*ck-up is laid at their doorsteps.

The people facing the biggest hits to their buying power, including savings erosion, are sort of at the mercy of the people who have the power to effect legislative and regulatory change. Too bad the incentives and interests of people with indexed pensions and approximately indexed pay raises don't exactly align with the incentives and interests of people without those things.

 

[mariomike]

Too bad the incentives and interests of people with indexed pensions and approximately indexed pay raises don't exactly align with the incentives and interests of people without those things.

Too bad instead of, "We don't have it, so they shouldn't either."
People could not look at it this way, "They have it – why don't I?" It's not a race to the bottom.

 

[Navy_Pete]

This was my point in a previous post. You don't get to decide what 40 cents means to someone else. You also don't get to decide that they can suffer that additional cost with no issues.

Peoples personal financial situation will dictate that. Not you, and not Stats Can and not the Gov.

Now, JT need to be held accountable for the time leading up to this and how he and his gov chooses to navigate.

I honestly have no idea what you are talking about. I'm not saying anything other than that's where the numbers comes from, and it's a lot more complex than one simple number if you poke at it at all. The fact that overall it's at 7%, with things like furniture being below 1%, doesn't change the fact that food is over 10% with specific items being more. Similarly housing overall increase was in the 5% range, but because it's such a large portion that is a massive increase, even if it's below the overall CPI.

If anyone wants to use CPI, fill their boots, but it doesn't represent the impacts on individuals, because that's not what it's for at all. No one is fiddling with the numbers; the numbers simply aren't being used for its intended purpose by people who understand what it means.

But realistically if a rise in anything costs me an extra hundred bucks a month, I'll care a lot more about that than an increase of a few bucks a month, regardless of what that works out for a percentage. That's why mortgage rate hikes can be devastating, a small change can result in real large increases in real terms (vice huge percentage changes to low dollar value items that have low real term impacts). Similarly the cost of gas nearly doubling in the spring could add hundreds to commuting cost every month, and lots of people don't have the option of public transport for work.

For some folks the cost of bread might be the critical one, for others it will be something else; all I'm saying is CPI is a 50,000' general indicator, the general impact on individuals is much more complicated. When I plugged in my personal inflation to the tool I was around CPI overall, but if I was to start commuting back to work daily it would go up to around 12%, so really depends considerably on your personal specifics, and can change very quickly.

I do maintain though that calling it 'Justinflation' is fundamentally ignorant though, and completely ignoring the real causes of global inflation that we really can't do anything about.

 

[brihard]

Chiming in as an ‘elder millennial’, we have a whole generation of us who have reluctantly been no-shit adults for over a decade now, with houses, spouses, jobs and kids. We started having adult financial responsibilities around the time of the Great Recession and started fighting our way into the housing market after that. We’ve never experienced interest rates (read: mortgage rates) that weren’t historically low.

I’m aware of that and plan accordingly, but I’ve also been super lucky on real estate timing and am about to renew at 2022 interest on early 2017 purchase price. I’m also, objectively, in an enviable financial position. As a household we can swallow that easily enough.

Many in my generation were a year or three behind me getting into home ownership and are gonna get smoked on renewal at way higher payments. Their first cars will crap out around the same time, and that’s when kids’ sports and stuff will also start. We have a generational reckoning starting to hit. Money has been super cheap, and now the yellow stickers are getting pulled from the shelf.

 

[Brad Sallows]

If everyone had roughly the same income, everyone would have roughly the same purchasing power. Those in the upper three or four deciles who understand what that would mean probably would not look forward to the prospect.

 

[Halifax Tar]

I honestly have no idea what you are talking about. I'm not saying anything other than that's where the numbers comes from, and it's a lot more complex than one simple number if you poke at it at all. The fact that overall it's at 7%, with things like furniture being below 1%, doesn't change the fact that food is over 10% with specific items being more. Similarly housing overall increase was in the 5% range, but because it's such a large portion that is a massive increase, even if it's below the overall CPI.

If anyone wants to use CPI, fill their boots, but it doesn't represent the impacts on individuals, because that's not what it's for at all. No one is fiddling with the numbers; the numbers simply aren't being used for its intended purpose by people who understand what it means.

But realistically if a rise in anything costs me an extra hundred bucks a month, I'll care a lot more about that than an increase of a few bucks a month, regardless of what that works out for a percentage. That's why mortgage rate hikes can be devastating, a small change can result in real large increases in real terms (vice huge percentage changes to low dollar value items that have low real term impacts). Similarly the cost of gas nearly doubling in the spring could add hundreds to commuting cost every month, and lots of people don't have the option of public transport for work.

For some folks the cost of bread might be the critical one, for others it will be something else; all I'm saying is CPI is a 50,000' general indicator, the general impact on individuals is much more complicated. When I plugged in my personal inflation to the tool I was around CPI overall, but if I was to start commuting back to work daily it would go up to around 12%, so really depends considerably on your personal specifics, and can change very quickly.

I do maintain though that calling it 'Justinflation' is fundamentally ignorant though, and completely ignoring the real causes of global inflation that we really can't do anything about.

This:

But again, if bread goes up 14%, that's what, $0.40 a loaf, so a few extra bucks a month?

I never used the the term Justinflation. Nor do I think he's in charge of global inflation. I'm not sure how many times I have to say this, but can you remember this this time ?

 

[Halifax Tar]

Chiming in as an ‘elder millennial’, we have a whole generation of us who have reluctantly been no-shit adults for over a decade now, with houses, spouses, jobs and kids. We started having adult financial responsibilities around the time of the Great Recession and started fighting our way into the housing market after that. We’ve never experienced interest rates (read: mortgage rates) that weren’t historically low.

I’m aware of that and plan accordingly, but I’ve also been super lucky on real estate timing and am about to renew at 2022 interest on early 2017 purchase price. I’m also, objectively, in an enviable financial position. As a household we can swallow that easily enough.

Many in my generation were a year or three behind me getting into home ownership and are gonna get smoked on renewal at way higher payments. Their first cars will crap out around the same time, and that’s when kids’ sports and stuff will also start. We have a generational reckoning starting to hit. Money has been super cheap, and now the yellow stickers are getting pulled from the shelf.

The oncoming generations have definitely been boned hard by the preceding generations. No doubt about that.

 

[Lumber]

I never used the the term Justinflation. Nor do I think he's in charge of global inflation. I'm not sure how many times I have to say this, but can you remember this this time ?

He's not directing that at you, he's just bringing the conversation back tot he beginning. If you look at this conversation as whole (at least over the last couple of days), it all comes back to a few central questions/premises:
1. Whether JT and the LPC (i.e. the Government) have anything to do with the current state of inflation in Canada;
2. Whether the term "JustInflation" is clever and innocent, or inaccurate, manipulative, and juvenile;
3. Whether the reported inflation is accurate from a person-to-person impact perspective; and
4. Whether the government is actively manipulating thereported inflation rate for political purposes.

 

[IKnowNothing]

I can't blame people for playing the game in the rules that exist.

I will blame business and banks for knowingly letting people over extend themselves for profits sakes.

How far does that extend? All vice, or just reckless financial decision making?

 

[Lumber]

I can't blame people for playing the game in the rules that exist.

I will blame business and banks for knowingly letting people over extend themselves for profits sakes.

This is an interesting stance. You've stated that you yourself are more conservative, and while I can't reference any specific policy statement of the CPC, generally speaking conservatives want less government regulation in business. But, you're second sentence would imply that you might appreciate greater control over business so that they don't profit from the fact that people are so easily manipulated.

 

[IKnowNothing]

Germaine to the last page of conversation but not necessarily the thread, I apologize that this comes late for several of you with impending renewals, but I highly recommend to anyone with or that will have a mortgage investigates the Blend & Extend options their chosen or prospective institution offers. They do a pisspoor job advertising them but they can be an absolutely incredible tool for managing cost and interest rate risk. I bought in 18 on a five year fixed. Instead of coming due next summer I averaged down once and then extended once at par, not up for renewal until 2027

 

[Halifax Tar]

He's not directing that at you, he's just bringing the conversation back tot he beginning. If you look at this conversation as whole (at least over the last couple of days), it all comes back to a few central questions/premises:
1. Whether JT and the LPC (i.e. the Government) have anything to do with the current state of inflation in Canada;
2. Whether the term "JustInflation" is clever and innocent, or inaccurate, manipulative, and juvenile;
3. Whether the reported inflation is accurate from a person-to-person impact perspective; and
4. Whether the government is actively manipulating thereported inflation rate for political purposes.

Fair. I can walk that back. When someone replies to me using the quote function I tend to think I'm the one being spoken too.

How far does that extend? All vice, or just reckless financial decision making?

Like all things in life it's not that black and white. There is nuances for everything.

I'm sure lots of folks said screw it and happily accepted th banks and over extended themselves. I also know a good portion are just to house cloth and feed a family. Those are the ones who I feel sympathy for.

This is an interesting stance. You've stated that you yourself are more conservative, and while I can't reference any specific policy statement of the CPC, generally speaking conservatives want less government regulation in business. But, you're second sentence would imply that you might appreciate greater control over business so that they don't profit from the fact that people are so easily manipulated.

What I would appreciate is some regulations that protect people in financial trouble from getting further in trouble by using high interest/risk loaners.

Think places like money mart. That's just loan sharking and it preys on the vulnerable.

Being conservative doesn't mean I don't have a heart.

 

[Lumber]

What I would appreciate is some regulations that protect people in financial trouble from getting further in trouble by using high interest/risk loaners.

Think places like money mart. That's just loan sharking and it preys on the vulnerable.

Being conservative doesn't mean I don't have a heart.

I agree. I used to lean more on the libertarian side; if people want to smoke, drink, and eat processed food till they die at 38, let them.

While I still believe that, I would only believe it if the person killing themselves is making that decision without a massive amount of outside influence.

What I've learned over the years is how easily people's behaviors and beliefs can be influenced, and how ready business are to take advantage of that fact.

So, on the micro scale, people have 100% free-will. On the macro scale, people are lemmings.

 

[Good2Golf]

So, on the micro scale, people have 100% free-will. On the macro scale, people are lemmings.

…or cult (of personality) members…