The Two Things That Keep Toronto Housing Market Messed Up

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The news is in – there are 15,000 to 28,000 homes in Toronto that are sitting empty. The real estate industry downplayed this as just 2 to 4 percent of all housing units, as if that cannot affect the housing prices and supply at all. They are wrong.

First, we have to understand that many of these houses are investment with no plan whatsoever to rent the units out. There are special investors unlike the classic ones who want to put their capital to work. These special investors are parking money on these properties just because they need a safer investment vehicle than keeping cash in the bank. By the way, keeping a lot of money in the bank is not safe.

So the suggestion of putting a vacant-home tax on these empty houses will not improve the supply of rental units that much. At least not as effective as what many people believe. The reason is exactly what I wrote earlier that there is a new class of housing investors who do not behave the same way like the ones that we are familiar with. This class of investors will simply choose to ditch their investments in housing and switch to something else. Hence, we may see a drop in average purchase price but not improvement in rental unit supply.

Case in point – the so-called foreigner tax on properties has already been neutralized by accounting tricks in Vancouver. I guess the same fate on foreigner tax will happen in Toronto quickly.

Lesson learned from foreigner tax? Negative incentive (i.e. punishment driven taxes) seldom works.

Further complicating the situation, many smart investors are now converting their investments into AirBnB instead of the traditional long term rental because of the significant increase in potential income. In additional, the rental units operated as AirBnB can be sold quickly with no troublesome issues of long term contracted tenants. Hence, local people seeking for long term rental units are facing a near static pool of supply even though there are new condos built everywhere.

The government has to think of more novel ways to resolve the housing supply problem.

To start, they need to factor in the two new dynamics I mentioned above that changed the housing market behaviour so that the correct solutions can be found. Otherwise, people can no longer choose to rent or buy their homes because there will be next to none new supply of rental units. When everyone is being forced to buy their living places, the housing prices will never stabilize. The long term economic impact will also be very bad when labour mobility is greatly reduced.

Personally, I can think of several ways to tackle this problem but it will not be welcome by majority of the people living in Greater Toronto Area as the balance of renters and home buyers is now completely messed up.

For example, introducing positive incentive policies to get people to consider offering their housing units for long term rental can be very effective. It can be as simple as first time landlords offering long term rental units can keep their gain tax free the first 5 years. This encourages more people to consider doing long term rental instead of the more entrepreneur AirBnb option. We cannot force investors to do something they do no want to do but incentives can get people to think twice before going for the AirBnb route.

Policy of this type, however, is almost always objected by the NDP party because “it helps the rich”. So whatever I suggested here is, yet again, babble for my own amusement.

 

Resource

http://www.metronews.ca/news/toronto/2017/06/12/in-housing-crunch-15000-to-28000-toronto-are-empty.html

The 10 and 12 Year Cycles That Shape Our Lives

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Many people interested in astrology would have experienced “a reading” done for them by astrologers. The routines are similar for both Western and Eastern astrology by telling the person something about their personalities, what is happening now and what may happen in the future. After all, majority of those who want a reading are not doing it out of curiosity. Many of these individuals are standing at a crossroad for which some major decisions have to be made. Yet, these people are so confused and worried that they have to resort to ask for help from astrologers …

Note: Following writing assumes that you believe somehow astrology works.

Reliability of Asking for Divine Clues Through a Third Party

One of the weaknesses of having astrologers reading your charts is that they may not be able to understand your situation enough to project the possible outcomes based on your birth date and known conditions.  Here is a good example. If the astrologer is not knowledgeable enough to know that there exists technologies in the near future that your medical issues can be cured, based on limited understanding, the astrologer has to conclude that you may not be able to live through the ordeal.

By similar reasoning, how worldly the astrologer is will determine how good the interpretations of your charts will be. Your future are many possible outcomes based on your actions and decisions today. The more logical and knowledgeable the astrologer is, the more likely you will get sage advices. But that holds true too if you talk to someone who is not an astrologer. As long as this person is logical, knowledgeable about your situation and has deep understanding of human psyche, you are likely to get very good advice as well.

Suggestions from Expert Astrologers vs. Knowledgeable People We Respect

Most of the time, the problem of finding a solution is not that we do not have the answers. The problem is that we choose not to take the path that we know will solve the problem. Seeking for better understanding of a situation is a good move for solving all kinds of issues. However, seeking for approval of our choice from others is a form of evading responsibilities.

That’s why it is so appealing to look for help from astrologers. People will choose to listen to the astrologers because they represent clues from divine sources which can help those people seeking for help to overcome their irrational biases. It is kind of blame the others attitude should things goes wrong.

When we get advices and suggestions from people we respect on major issues, many people will eventually choose what they feel comfortable with, ignoring the warnings and good advices anyway with the additional bonus of creating false memory in their own minds so that they can blame on these people who offered their opinions in the future. I have seen so many people doing this type of self sabotage to themselves. They cannot help it because they lack awareness of their own weaknesses in the first place.

When You Need to Make a Big Decision Do This First

If you are at least 30 years old, here is a simple thing that you can do to get consistent answers to your tough questions about your life altering issues.

Just look back 10 years ago to see if you are affected by a similar situation. Sometimes the issue is not affecting the same area in your life but the overall scenario will pin you to the same position. For some people, it can be something that happened 20 years ago or even 30 years ago. The important thing is that you should be able to tell at once if you can remember what happened in the past because the timing should be very precise.

For example, 10 years ago you may have a troubling relationship with your partner at the time that you have to choose between breaking up or giving up your dream job. The current situation could be that you in a bad relationship with your coworkers who try to take advantage of you while the boss turning a blind eye.

Think of what you did back then. Reflect on the situation to see if you have chosen the right decision. Most important of all, did you make the decision back then that you are still regretting about. This will give you a good idea what not to do this time.

In short, you do not need an astrologer to tell you what to do. You can figure it out by yourself as long as you can be truthful to yourself.

10 Year vs. 12 Year Cycle

Majority of people are more sensitive to the 10 year cycle while others see repeating patterns in their lives on a 12 year cycle. Usually just one of these two cycles dominate a person’s life. It is easy to figure out which one affects you more. If you have married or that you have a child, just look back and forth 10 years and 12 years from those dates to see if other major events happening to your life. This will give you a baseline on how things happening to you in a cyclical basis.

In case you wonder, these cycles do not start from the day you are born. Everyone has a slightly different starting point up to 8 years old. The later the starting point in life, the more likely the person has a wandering mind before then. This starting point affects how people mature into adulthood as it usually takes 2 cycles before a person finally start to think about the future.

After 3 full 10 years cycles, if a person has not progressed enough in awareness, Eastern astrology points out the person will likely be locked-in by fate. What it means is that astrology will work so well on these people that they are expected to repeat all the mistakes they have made before. Notice that it has nothing to do with good fortune or bad fortune. It is just that what may happen in the future to these people are more predictable.

The Power of Virtues in Breaking the Cycles

When we choose to live by a set of virtues at all cost, we program our minds in a way different from the one driven by our character traits and emotional burdens that we know are a mix of our genetics and our upbringing during our childhood. Choosing to live by our virtues helps us to make hard choices and better decisions when fear and greed are affecting us the most. In short, we simplify our lives while improving them significantly in all areas by just following a set of ground rules we choose to believe in.

I am not saying we will make the best decisions in all situations we encounter in life if you follow your set of virtues. What I am saying is that having a set of virtues in place is like having a consistent strategy to manage our lives so that we can have consistent outcomes that we can count on so that we do not need to worry about every decision we make are good or bad. We know on average we will come out doing fine. That’s all that matters.

It is easy to see how such strategy can impact the outcomes from all the cycles a person has to go through.  Normally, a person reacts to the events in life with emotional swings. Many important decisions are made on-the-fly, at least partially driven by the emotions experienced. Such decisions are often made without considering all the facts hence are more likely to be bad ones with negative consequences. In contrast, someone lives by a set of virtues can limit the options to choose from and eliminate the ones that does not follow the principles. With fewer important decisions made badly, the so-called fate or cycles can no longer limit a person’s achievement and success.

Think about it – just the anxiety and worries you saved yourself from by having a good strategy in place to manage your life can do magic already. Being able to sleep without all these wandering thoughts put you way ahead of many others in terms of quality of life. With reduced stress, better clarity of mind becomes possible and in turn better decisions are made more often. Cycles, whether they exist or not, no longer matters.

Too Much Going on This Week

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Lots of things happened this week disrupting my normal schedule, making it difficult to write on the topics I have prepared. So, instead I will just talk about what has happened this week.

First, my website revamp plan on Daytradingbias.com took a big hit when the site designer chose to quit. I was left with a partially completed new site that still takes a lot more work to complete. Hence I have to scramble to find someone else to take on the task. I may as well scrap the partially done design with a completely new one. We’ll see.

Second, a friend from Germany came to Toronto suddenly looking for my late girlfriend. I did not know how to deliver the news to him. Talking about the past is something that still triggers my suppressed emotions. And that this was happening over the Valentine’s week did not help either.

Third, a good friend of mine was served divorce notice by her husband. It is expected all along but choosing this week to deliver the notice is some statement. Talking about evil intentions, this is a prime example how some people’s integrity can be way below average.

Too many things happening at the same time.

Bad Eyesight

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I was very proud of my good eyesight for many years. I am not talking about 20/20 vision here. Several years ago when I was at my early 40s, I still have 20/10 vision. No glasses needed all my life, well, until last year. Upon reflection it is an important event, for me, to share with everyone.

Better My Eyes Were, Worse I Exploited Them

With very good eyesight, I did not follow any advice to protect my eyes at all. I often read in the dark for hours just because I can. I chose to use dim lighting most of the time for the same reason.

I did not protect my eyes from extreme tiredness. Working on computers for many hours without a break was the norm for me.

In short, I exploited my own eyes as if they would never break.

Presbyopia Catches Me Finally

Since second half of last year, suddenly I need reading glasses to read from my computer screen and from reading books or even labels with smaller prints. It happened so suddenly that I was kind of caught completely off guard. In short, Presbyopia, a condition for which deterioration of the ability to see things clearly close to the eyes due to aging, has finally caught me.

The inconvenience caused by Presbyopia is mainly the need of reading glasses everywhere. Originally I thought I do not need them when I went out. Yet, as I try to buy something I often cannot see letters on some of the tiny price tags. When I need to read the description or details on a label for anything, I will have a very hard time putting the item at the right distance to read those damn words.

Blind Spot of Our Minds

According to a friend who is an ophthalmologist (eye surgeon), if I protect my eyes properly, I would be able to keep going without glasses probably for the rest of my life. My exploitations of my eyes led not only to aging them by 10 to 15 years, I also likely damaged some of the muscles supporting the eyes. I have no one else to blame but me.

Seriously, who would have thought of the consequence when they do not have the experience of the inconvenience of Presbyopia in the first place?

Well, I should have. I took so much proud on my ability to manage risk in trading and long term investing for not just myself but also large sum of money from my clients. Yet I do not see this coming.

I know the importance of staying healthy and took the time and measures to keep myself fit. Yet I did nothing to ensure my eyes would function at their best when I need them most, when I am getting old.

This is a blind spot in my mind. Because I did not see the existence of the risk of losing my eyesight, I blocked all the information regarding eye care from entering my mind. This is wilful ignorance.

I am sure there are other areas I have similar trouble.

From now on, I will take care of my eyes. I promise myself at least not to make the situation worse. It is the least I can do to contain the problem.

(Feature Image from Wikimedia Commons)

Peak Marketing

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We’ve heard about peak oil, peak gold and even peak water events. I like to suggest that peak marketing, or peak social networking, is a near term inevitable event. No kidding here. I seriously think the expected global economic slow down is at least partially affected by this.

 

It Is All the Marketers Fault

One thing that keeps up with the technological revolution all the time in the past 200 years is marketing. Every advancement in technology available to the public has turned into new ways for people and businesses to promote their products and services.

The moment publishing became a reality, we got flyers.

Shortly after the moment radio was invented, marketers figured out how to use the channel to blast out audio advertisements to the public. It works very well back then. However, as people got used to simple statement based advertisement, their effectiveness dropped. Smart marketers improved their ads with sound effects, music and pretty much anything you can think of since.

Whenever a new media form becomes available, the marketers would exploit that.

Whenever the simple delivery methods drop in their effectiveness, the marketers would refine their approaches.

As you can see, it is a never ending cycle of power struggle between the marketers and the public. The marketers try their best to trigger the biggest percentage of responses they want from the public. In response to what the marketers do, the public gets numb over time after every new marketing approach is applied.

Lucky for the marketers up to the present time, technology breakthroughs in introducing new form of media has been on high gear all years. Marketers get to benefit from this a lot as it gets easier and faster to reach more people at lower costs all the time.

As the marketers working hard to grab our attention, they desensitize our reactions to promotional materials. The marketers destroyed our attention span. In a way, it is all the marketers fault making us not interested in anything if the promotional materials could not catch our full attention.

 

Peak Connection Materialized in Social Networks

Until next round of even better technology emerges beyond the current state of computing, social networks have successfully connecting people all over the world in ways we can never imagine in the 20th century and probably maximized the potential of this capability. Even if the potential is not fully tapped, it must be very close to the limit because the best possible scenario is connecting every single person on Earth in some way on the internet.

For majority of people in the civilized world, especially for the younger generation, they are already connected on the net by some measure. Even governments and big companies are encouraging people to do so such that they can off load the cost of hiring more people to service their clients back to the clients themselves through self-serve internet portals. There is really not much more room for more improvement in this area. At least the leaps and bounds we see in the past 10 years will not be possible going onward.

So this is it, we are getting very close to peak connection among all people on Earth. And this is the where the nightmare begins for the marketers. The world has reached at least a short term plateau in distribution channels similar to the way how TV advertising was completely saturated at the end of the 20th century. The upper limit of audience that one can reach on the internet is now well defined.

 

Marketing End Game

All these techniques developed by the leading edge marketers on the internet nowadays are no longer driven by simple hacking or guesswork. Marketers tap into the science of human behaviours, from how we react to certain colours to how normal people focus their eyes on a page, in order to maximize the results they are looking for. The world famous orange colour button Amazon uses on its site is a prime example how much effort is put behind everything we see on the internet today.

Well, such optimized approach to trigger human responses works very well every time a new trick is discovered. But it has led to rapid decline in effectiveness of all marketing techniques as people are trained to ignore these “noises” affecting their normal internet usage. In short, people are evolving as well in the way how they handle visual and audio stimulants.

Unlike the TV era, where advertisements were shown to us one at a time. We are now bombarded by multiple advertisements within one web page almost all the time. Everyone of these marketing efforts contain at least several triggers based on human behaviour to induce us to response to them. We are bathing in these stimulants everyday. No wonder our numbness towards internet based marketing materials has been developing at such an incredible rate.

The numbness in human responses to advertising will be the biggest challenge for the world we are living in today due to the fact that our world is now a consumption driver economy. With less consumption, there will not be enough economic activities to drive the necessary growth to sustain the infrastructure cost of the big governments around the world. Big companies cannot solve this problem by reducing their operating costs only as the slow down in sales growth or real decline in sales can hurt the bottom line much faster.

Peak marketing will likely dampen global economic growth in coming few years.

 

Peak Marketing Until Next Technological Revolution

I am not a doomsayer and I do not believe in those end of the world stuff. This current peak marketing situation will probably be resolved in a way similar to what happened before. When internet was introduced, we did not know that one day, it will become the primary means for people to connect to each other. No one back then can tell how quickly TV no longer dominate the way people spend their time.

For now, internet is likely maturing into its final form and usefulness. It has come a long way from desktop to wireless, and now going mobile everywhere. When a similar disruptive event like the popularization of the internet happens in the future, I am sure marketers will find new ways to grab our attention, and our money, in no time.

Year of the Rooster and General Ignorance in Chinese Astrology

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One of the favourite things Chinese people (and now Westerners who somehow love the New Age stuff) is to read about their fortune for the coming year. There is really no harm done if you take this lightly as a fun event. However, the practice itself, for which originated from commercializing the astrology knowledge for profit, has profound negative effects on people who needs real guidance.

The Economic Aspect of Yearly Forecast Books

First thing first, using whatever year a person is born in to map into a 60 year cycle for predictability of personality and other matters is stupid already. It should take no time for any normal person to reject the idea completely. Yet, every year you can find tons of Chinese horoscope yearly forecast books selling on the street starting December. I asked around when I was in Hong Kong to see how good these books are selling. From what I gather, the more depress a year has been, the more forecast books are sold.

I also asked around to see how people usually buy these books. I wonder if they have certain preferences or patterns that I can uncover. It turns out the psychological behaviours and motivations behind the purchases are very interesting.

Some people will always buy the forecast from the same astrologer, until one year the forecast no longer feels right. These people will then purchase an additional forecast book from another famous astrologer to compare the predictions. Eventually, these people would purchase multiple forecast books every year. As I learned, much of the profits for bookstores and newsstands in Hong Kong during December and January are coming from sales of these forecast books.

In general, it is those people who have a pretty bad year (in their own minds) will more likely to start the habit of buying these forecast books. Once they have bought the first one, however, it is very likely that they will buy another one next year. By random, even if the forecast are complete nonsense, there is always 50% chance of these new readers who find the materials meaningful thanks to skilful writing styles. Just like smoking, the big business of these forecast books is the accumulation of long term consumers.

The Psychological Aspect of These Astrology Yearly Forecasts

Those people who had a not so stellar year are always feeling down at the end of the year. It is a reasonable thing. Just like anyone who look around at their friends all hooked up with someone would feel blue themselves, these people will seek for comfort, specifically psychological comfort, by various means. Astrology forecasts are one of these products that serve this huge market.

The problem though, is that those who seek comfort this way is doing this wrong. To get out of a ditch you work your way out, not sitting there crying and do nothing. These forecast books, in a way, jailed these lost souls in the same bad place by giving them false hope. When they hope that things will get better instead of creating the necessary change to make things to better, they are stripped the chance to fight back.

I am not judging whether the Chinese astrologers are doing a bad thing or not. I am sure many people do find encouraging messages from these forecast books for which positive impacts can happen. But that all depends on the original personality of the readers and how they interpret the information which can be very subjective or biased.

If You Do Believe in Astrology …

Then you have to learn that the year you are born in cannot help you to figure out your fortune based on all the known Chinese astrology methods. In other words, those yearly forecast books are not going to help you. All those common methods based on the year you were born that are passed around on people compatibility, romantic compatibility, etc. are all bullshit.

In this aspect, Western astrology actually works a bit better, but only if you at least dividing up the Zodiac from 12 signs into 36 parts for decent precisions.

For Chinese astrology, a proper yearly forecast has to be done with accurate birth date including the time and location. This will usually cost a lot of money as famous Chinese astrologers command a lot of premium on their services. However, if the Chinese astrologer is not a responsible practitioner, you will still not get the precise forecast you are looking for.

A good Chinese astrologer has to analyze your birthdate in detail with lots of questions on your current status so that your actual situation can be mapped out properly based on the specific method in use. After that, the astrologer has to find out the context of your situation as well. What I mean by context is how you get to the current situation over the years. Without knowing that, the astrologer can only provide very general forecast that may or may not be applicable.

Higher Awareness Matters

The so-called forecasts made with astrology methods are forecasts based on patterns. These patterns exist not because there is a divine order for which our future is predetermined. Instead, it is our inability to think clearly, objectively in a calm manner that sent us into making the same mistakes over and over again.

I have seen many people whose higher awareness helped them to break away from the expected path based on astrology analysis. Their higher awareness is learned or trained over time. Many people invest in themselves by getting a professional degree. Some others figured out they need certain skills and went to study in programs to acquire the skills. But, rarely do people realize the most important thing to learn is training your mind so that it can protect you from your own physical body, with all these defects in terms of personality weaknesses and bad habits.

With higher awareness, everything can change, including your fortune.

Stop buying these astrology yearly forecast books can be the start of great fortune already!

2016 New Year’s Resolution

last_one_standingThis is the time of the year to set goals for the rest of the year. Upon reflection, last year was a transition year for me in searching for a more balanced life. I looked into many areas of interest to see what fit me best. I do not have all the answers yet and I hope in coming weeks I will figure out the direction in life for the coming few years.

 

Reflection from Being Depress to Being Too Busy

First thing came to my mind was the thought of retirement early last year. Retirement in the sense that I no longer take on consulting work for institutions or putting in efforts to develop various businesses. I could also limit my trading down to just  a day or two every week. I like trading and I can never imagine not being a trader going forward. The idea was to give myself more quiet time and enjoy life more after going through my life changing experience.

That idea was strike down quickly by family and friends. In fact, it was just an excuse to hide from the world to keep myself in a shell so that I could deal with my emotional issues alone. Thanks to very supportive friends and family, I snapped out of that mindset and got better since. In particular, without the kind-hearted interventions from one close friend, I would not be on my way to recover from depression.

Throughout last year, I have initiated multiple projects. Wrapping up the book Art of Chart Reading is one of them. I am still waiting for the completion of the editing process. I know it is taking longer than usual but I know the result will be a much better version that more people can learn from. Just like any other authors, I secretly hope the book will become one of the all time classics.

And then there was my initiative to mentor / coach retail traders. I see great results with half of them so far. A quarter of them still working on their progress while the rest due to various circumstances cannot really commit to their trading at this time. I am very happy with the results I see so far. It reaffirms what I believe – trading can be taught through a longer term approach as it is more a skill combining knowledge and craftsmanship.

I am contemplating this year to be the last year I will take on more traders to mentor. I have not finalized my decision yet. One reason for this is that it is very time consuming as I tailor my work to fit the individual trader’s need. This personalized approach definitely gives better results and serves the traders better. On the other hand, it puts a constraint on my time to commit to other projects.

In second half of last year, I accepted the requests from several close family friends, who were my backers way back when I first started managing money, to help them invest their money with lower risk and better returns. I ended up offering them 10 to 15 percent fixed interest on their committed capital depending on the duration of their commitment. As oppose to having them to bear the downside risk, I assumed the risk with my own capital. Using proper leverage to day trade Emini, my trading models can generate the desired performance and has been performing as expected so far.

It is nice to see that I can offer my friends an alternative investment that beats putting money in the bank. The effort to structure these arrangements is ongoing and is taking up time. From what I see, it can potentially benefit many more people, especially those who needed interest income. How to approach this in a larger scale is a tough question.

Thus, mentoring and managing money is now completing for a big chunk of my time while my unfinished writing projects over the years are still there gathering dust. I need much better time management going forward so that I can accomplish more in a shorter time span.

 

New Goals

As oppose to writing out a list of exact things I like to accomplish this year, my resolve is simply:

1. To identify and prioritize the tasks on hand

2. To find the direction and focus going forward

3. Have #1 and #2 finalized before middle of February so that I can efficiently execute the plan for the rest of year

On the more personal side,

4. To stay healthy by living a healthy lifestyle

5. To be there for my loved ones

 

First Week of 2016

Trading in first (and second) week of the year is often very confusing. Many people focus heavily on the January Effect for their investment decisions. There are also the Super Bowl indicator crowd waiting for February 7 this year to adjust their portfolios. So many superstitions and misinformation are spread in the beginning of the year to keep the media and financial outlets very busy. Hence, it is often a good idea to wait until after the first week of the year is over before resuming trading.

On the more technical side, or my trusted common sense approach, the first week of the year is the time parents scrambling with their schedules to get their kids back to school, those who went on vacations coming back gradually over the week and people recovering from hangovers and bloated stomachs. Without all the players ready for the game, it makes sense that the game is not going to function properly.

If you have to trade in first week of the year, try doing it with smaller size and ignore all the buzz generated by the media. By the end of the week, having a summary analysis of what happened over the week will be more useful than participation in the madness.

 

Wish Everyone Here a Very Happy New Year!