Taking my Medicine!

Financial Choices...

Over the past 13 odd years of working in Canada I've been contributing a chunk of my earnings each year into a tax sheltered account to fund my retirement - whenever and whatever that might be.

Over the last year or so it has increasingly seemed like "retirement" (of a sort) might be now!
Unfortunately, also over the last year or so, the mutual fund investments that the money has been in have been having a really hard time...
And the "down side" has been accelerating rapidly over the last few months!
Unfortunately also, over the last year of my travels, I had not been paying that much attention to this area of my finances - and so it has taken me a while to get a handle on "the big picture" and how it effects me personally.

So, where am I now?

Well, for a start, all these numbers are in a way "fictitious" because I'm not actually using the money at the moment, so it doesn't effect anything in my life at the moment.
However, The money I put into this account was/is indeed "real money" and I foresee that I will truly be using it in the near future.

The current standing of those monies is that I am down about 40% in "value" compared to about a year ago!
Further, if I exclude theoretical gains (growth in fund values) from the equation and just consider the actual value of money that I contributed, then I am down about 20% of the value - That's real money that is "GONE"!

So, whats done is done.... All I can do at present is decide what I will do in the future...
And that depends on what I think will happen with the "economy" in the future...
Big Question!.... and its on many peoples minds at present.

So, I spent a week or so pondering this and while many people would have huge "angst" over the subject, I have suffered relatively little in this decision process. I have just thought about what I think is happening and what likely will happen ... and have made choices accordingly...



So, What were the options?

The choices for action were threefold:
1) Leave the money invested as it was - Do nothing.
2) Cash-out the existing investments and just hold cash - Like a bank account.
3) Cash-out the existing investments and then reinvest into different funds/stocks.
The choice here is of course defined by what I think will happen in the Global, North American, and finally Canadian economies, and perhaps even more importantly...When it happens!.

What do I think is going to happen? ... Well, in a nutshell; I think this:

All those economies I mentioned have taken very large declines in the last two months (precipitous!) . There is no doubt that we are in a very significant recession (Right Now!)

OK, so things are down, but perhaps we are near the bottom and things will come back up from say early next year :)

Sorry to say but I dont think it will be like that. As far as I can tell, there is absolutely no reason why things will get better... In fact I think we have only just started to see the negative effects triggered by the economic down turn. In days of old, the stock market was tied to actual gold bullion being moved around in banks, but they stopped doing that a long time ago, and now there is no "inherent lower limit" on the value of stocks..... There is no known bottom!!!

To date, we have seen a financial crisis. Particularly in North America (Though I understand Europe is bad too) due to foolish lending practices - particularly in the real-estate space.
So, we have seen foreclosures on the "bottom edge" of the mortgage market - These people should never have been given loans in the first place, but we've only seen some of them defaulting ... I believe there are plenty more yet to come!
We've also seen that companies are having a really hard time getting loans and are thus cutting back on everything they can. The western governments are actively trying to help solve this problem but the effect is still there.
We've seen that consumer confidence is plunging and people are not spending money the way they were just a few months ago. We also see that this trend is increasing as we go into Christmas and it appears that it is not being turned around by the government intervention.... very bad sign!
It means that all those companies (basically any company at all) will not only have a hard time getting loans but they wont have the revenues that they used to either!
And that means that they will have to take much more aggressive steps.... Reducing their employee counts!
We are only just starting to see this happen now, but I believe that it will get far worse... The only reliable employer in the near future that I see will be the public service or government contractors as Governments try to "help" the situation by creating jobs and civic projects.

So, as we see unemployment increase (and I think it could get to 10 - 15% here in North America) there are going to be a whole lot more people who had mortgages that they were just able to keep the payments up on who are now suddenly out of work.... and they will have to sell their houses.... but no one will buy... and so foreclosures will get another large increase.... another chunk of the population will stop spending money.... etc.

And we have heard all about the "stupid" levels of credit card debt that people are carrying. But I dont think we have seen this surface yet. I think we wont see it till after Christmas (how long after...who knows?)... and it will be big.... and it will hit the financial sector again!....

On the real-estate front, all these forced sales will I think, really deflate prices. I would not be surprised if prices dropped a third or even a half of their current values (particularly in "hot spots").
So, If money was what I cared about, then I would sell my house right now and take the 10% lower sell price just to get it done fast!
But money is not what my life is about, and I'd rather have a "home" which is what my house represents for me (even though I dont plan to be using it for the next year or two). It may turn out that I dont even feel the need for a home in a year or twos time, (non-attachment being the ultimate goal - or so we are told!) But right now, I still feel like keeping the house is a good thing :)

Then there is the price of Oil. Its plunged recently - which you would think is a good thing since it helps the consumer as well as industry in the short term and should help out the North American car makers (big inefficient cars).
But I had a look at the price of oil over the last several decades, and as far as I can tell, the recent price increases were completely artificial... I dont see the need for the price of oil to go back above $50 a barrel...(Other than the greed of OPEC) I think it could stay low for quite a while...
Note: I have no problem myself with the price being high...in fact I think it should be deliberately held high by governments taxing it - and using the revenue for environmental purposes. But I think the price will stay low, and the down side of this is that the Canadian economy gets a lot of money from oil/gas - so this is a downer for the Canadian economy and thus my money.

And what about the Chinese economy pulling us up....
I really dont think so! In fact, I think it will be even worse there in China... Their sales of goods are to the West. But we have really just "shut off" the spending... This will really hit their manufacturing sector and competition will be incredibly harsh. They already have tight competition because they are in that "bottom end" of the manufacturing market.... I think it will be ugly in China and we have just not seen the effect yet! But then again, the Chinese government have the power to "artificially" hold the value of their currency at what-ever point they want regardless of how it effects their people... Hard to say what will actually happen there!

I'm having a really hard time finding any financial "good news" or bright prospect!
If there is one then it would be that Governments will be spending more to try to help out their populations in hard times.
So, what does this mean for my money?
I was largely holding "Canadian Equity" which is a largely resource based economy that is directly linked to the US economy.
I think the stock market will devalue Canadian equity significantly (possibly as much as half current values) due to the US economy, Oil prices, other Resource devaluation, and overall economic slow down.


I dont think I should hold my investments as they are!
What should I invest in instead? - Right now, I cant tell what is going to happen (like most people).
Although Im sure if you know what you are doing, there are some good possible investments, I think it is dumb for me to speculate at present!
I think I should just hold Cash! (like lots of people)


Thats all just speculation of course;
But its not "Idle Speculation" - Im taking action...
I have acted on my words and Ive liquidated my retirement holdings - Ive taken a big loss in doing so (and consequently given up on regaining my losses), but as I said, I think it will get worse for a while yet... significantly!... But the real trick that I just cant anticipate is how long these "probable" effects will each take to happen... and if they happen fast and close together or slow and spread out??

But if it turns out that Im wrong and things get better, then I can just buy back in later when I feel I can see further ahead...

So for me; Even though the medicine tastes pretty bad and I dont want to swallow it; Im pretty sure that its better than just letting the significant risk of the "sickness" proceed further along its current path.
So, I'll take my medicine now thank you!

Nothing but doom and gloom? ... Not so!
Actually, I am personally feeling fine about it.

I do think there are some very hard financial times for many people in the near future...
But, I dont think finances make people happy - mostly just unhappy!
I think we Canadians on the whole are incredibly spoiled and many of us can make do with far less than we currently have and be very happy. I think we are just heading in to a huge opportunity to reset our personal and social values.

And I think it could be a "step forward" for many... though not one we would take willingly! :)


So now we will wait and see what the future brings :)

No Picnic in the "Woods" Today

I was riding to work this morning with thoughts about selling up a whole bunch of my RRSP mutual funds - The losses just keep growing!!!
As I rode over the hill through the now bare branched forest I saw a black lump on the side of the road that didn't look right.
I slowed down and did a U-turn to get back to it; parked and got off to have a look.

Sadly, it was a dead Black bear. I could see no obvious injuries, but I strongly suspect it was hit by a car some time in the night.
(Alternately, it may have eaten something that was bad for it - Like a Mtn Bike rider perhaps!)
It was I think a mature adult, and it had a blue tag in its ear.
Its sad but not surprising. Black bears are quite common in the area, and about once a year I see one in my back yard (just on the other side of the hill from where I found this one).





There wasn't much else to do though, so I continued on to work.
As I rode on, I had a related thought from my lateral thinking brain - Perhaps I could look at it as a symbol of the death of the "Bear market" that is really starting to effect everyone here in North America now...

Sadly again, I dont think that is the case and that the "Bear Market" will continue and get worse for a while yet...
When I got to work, I phoned it in to the local police who passed me over to the conservation office, etc.

No picnic indeed!

I am a River to my People!

... Though the river is small...
... And my people are few...
... and scattered...

I always liked that title line from the film "Lawrence of Arabia".


I decided that I should disabuse myself of any delusions as to how many (or few) people actually read my Blog.
So, I consulted my good friend Janine (who knows about these things from her own web site stuff - she also suggested using the blogger site... and doing a blog in the first place for that matter!) about how to do this and was duly directed to a web site that basically does it for you and for free too :)
I clicked through the options and then followed the instructions to add it to my site, and voila! We have a hit counter that seems to work.

And what does it tell me...

Well, it tells me that I have somewhere between ten and twenty regular visitors (after a week of operation) and most of the visiting is on the weekend. - No big surprises there.

Thats actually more than I had expected which is I guess a good thing, though knowing the readership (which prior to this I did not) doesnt really change how I feel about writing in the blog.

I started doing it as a bit of a trip log and a place to safely save some pictures while I was on my motorbike trip. It developed from there into a place for me to write down some of my thinking, and over time I have found this aspect to be by far the more valuable one for me. And it remains that - a valuable personal "thinking" space.

What is it for you? I dont really know... but it doesnt really matter, If you get something out of my ramblings then thats great, and Im happy to share myself :)


I figure my readership includes a few people from other cities and countries but for the most part you are my friends who live in Vancouver. That said, most of you already have my email and can contact me whenever you feel like it. But I think there are couple of you out there who dont have my contact details.

So, given that Im not opening myself up to large amounts of unwanted "backchat", for those few who dont already have it, my email is "grant_else" and I'm on the "@hotmail.com" service.

For you all:
You can write to me and comment on the blog at any time you feel like it :)
I do however, reserve the right to simply ignore you or to respond at my discretion - as I said, my blog remains primarily for my own purposes.


... and may the river keep flowing :)

Certain Death!

No, not really some new adventure of mine but it seems to me that it’s the likely outcome of the way lots of pedestrians around here are behaving…

I was riding my motorbike home from work on Friday evening. It was about 5:30pm and it was as is usual at this time of year, both very dark (the sun having well and truly set by this time) and a bit rainy.
When the roads are wet around here, they become far less visible for drivers. They are all paved by big automated machines these days and the result is a very nice smooth driving surface its true. The down side though is that the same smooth surface behaves just like a mirror when it gets wet. The film of water just reflects things, and on a rainy night, this means that you get reflections of lights and the black sky…. Even the white lines marking lanes seem to disappear and driving does get significantly more dangerous.
This is all pretty normal, and the traffic slows down and drivers seem to pay at least a little more attention between their cell phone conversations and adjusting their hair or eating their fast food … or whatever else they are usually doing while driving.

Like I said, this is normal and life goes on…
So, I was driving home in the light rain and being quite cautious when all of a sudden I realize there is a pedestrian strolling out onto the road directly in front of me and I had to break and swerve quite a bit to miss him.

Where on earth did he come from so quickly?

He was near to an intersection (15m past) but he was not on a pedestrian crossing. There are streetlights on the side of the road but it is near a park and the lights are more spaced out than usual.
This is normal and does not explain why I didn’t see him sooner.

The answer is that he wasn’t that quick, just very well camouflaged!
He was (as seems to be a common habit these days) wearing completely black clothing. His outer garment of choice this evening was a “hoodie” and he had the hood up and was strolling along with his hands in his pockets because it was raining.
So I didn’t even get the minimally reflective face or hands to see.
And he was just strolling along barely even looking at the traffic – This is pretty normal around here too (though I have no idea why) – if a pedestrian even looks sideways at the road in this city, most cars will immediately give way for them. The local pedestrians seem to have pretty minimal self-preservation instincts it seems to me. In virtually any other city I have been in these pedestrians would all get squished!

So, I avoided the unpleasant experience of running someone over and I gave him a good toot with my horn just after I went past him… to which, I noted in my rear view mirrors, he gave me the universal “hands slightly raised” and “whats your problem” expression…
Oh well, I guess he’ll figure it out the painful way!

This was the closest call like this that I have had but, sadly, Ive seen several other pedestrians dressed and behaving just the same in the last month or so…I guess its just that “in between” weather we have at the moment that is encouraging it.

Why do city people like to wear so much black stuff anyway????

Big Fish

My good friend Rick whom Ive known for about fourteen years now (basically since I came to Canada) is a dedicated fisherman.
Im not much of a fisherman myself and its not a sport that Im likely to take up seriously but from time to time I go fishing with him and Ive had some great experiences doing this - from Trout fishing in the inland lakes, to Salmon fishing in the local coastal waters to Sailfish fishing off the coast of Mexico.

This last weekend, was another of those occasions that I went fishing with Rick... and it was good!

The quarry of choice this time was a estuarine fish called Sturgeon. They are a bottom feeding fish that can live for over a hundred years and in days of old they have been recorded at over 20 feet long!
These days though, they are rarely caught at lengths over seven or eight feet (about 2 metres) and they are completely protected here in Canada (Catch and release only - not allowed to keep them).
Im happy with that and if it was not that way, I would not have agreed to go fish for them in the first place... back to the story...

When Rick made the offer to go fishing, I have to admit that I was a little unsure about going. The weather here had been really raining all week and it looked like it would continue. The prospect of being out on a small boat sitting in the middle of a river in the rain for a whole day did not sound that attractive to me.
But, Rick knows his fish and this was an opportunity that I would not likely get again, ... and Im trying very hard these days not to turn down opportunities that come my way - even though I may not see them as very attractive at the time!

So, I said yes, and I was up and ready to go at 5:30am on a cold rainy Saturday morning.
Rick and his brother Eddy came and collected me and we drove fourty five minutes out to the river where the guide (he knows where the right places to fish are and more importantly has a very nice jet boat all set up for fishing) was ready with the boat.
We cast off and zoomed off down the river to the first good "spot" where we stopped and dropped anchor.
The guide then set about baiting and casting out four rods (the bait was salmon roe... The rivers around here are full of Salmon heading inland up the rivers and streams to spawn.).
As I said, Sturgeon are bottom feeders and the technique for catching them is to put a chunk of lead on your line and some strongly flavoured bait on the hook (which is barbless so the fish are not overly hurt by being caught).
Once the bait is out, everyone just sits there and watches the ends of the rods..... thats it!.... Thats what you do for the whole day!....and for fishermen this is a really great way to spend your time....

Actually its not that bad :) In fact, we didnt have to wait long before the end of a rod was making the right sorts of motion and then someone grabs the rod and with a strong and fluid motion jerks back hard on the rod to "set" the hook in the fish's mouth.
In fact this is quite a skill to do well, and needs to be done well if you are going to land the fish. because the hook does not have a barb, the fish can effectively "spit out" the hook and bait at any time. The fisherman's job therefore is to ALWAYS keep tension on the line no mater what direction the fish or the boat are going or how fast.

Anyway, The morning went by with quite a lot of action and about  ten or twelve fish of assorted sizes were caught and brought onto the boat for pictures and measuring and then released again. They ranged from less than three feet long (nice one Eddy!) to just over 6 feet long (that one was mine :) ) .. and a good time was being had by all.

By about mid day though, the bites had slowed down and there was a lot more waiting and watching than reeling... So out came all the old fishing stories and discussions about equipment and techniques etc. Im sure you can imagine... fisherman live and breath this stuff.

We had been taking turns on reeling the fish in and everyone but me was an experienced fisherman, so they were all setting their own hooks (it wasnt till later that I was allowed to try this - I had limited success but my technique did improve).
Anyway, when it was quieter, we each got allocated a rod number and if there was a bite on your rod then you got to reel it in. If you got a fish over three feet long then you were "out of the rotation" for about a half hour and the other guys got your rod as well as theirs... It all seemed quite fair really.

And so the afternoon passed slower than the morning and the fish got smaller too (probably to do with the tides.). We moved from place to place along the river and slowly worked our way back up to where we had launched the boat that morning.
Last stop for the day was about a hundred meters from the dock and the guide assured us that even though it was very close to the dock and right between two very large bridges, that it was a good spot.
This proved to be very true as we got the largest fish of the day here.
It was nine feet four inches long and weighed around 600lb! (I dont know why they use the old imperial system but that equates to about 3 metres long and 300Kg).
It was on Rick's rod and he did the whole fight which took about three quarters of an hour (and left Rick extremely happy but extremely worn out too).

This is the largest fish I have ever seen! (and I think so for Rick too). It beat the near- record Sailfish we caught in Mexico several years ago that was just over 9 feet long and weighed 220lb. It was also the largest Sturgeon that our guide had ever caught.

So the fish was brought to shore (no way we would be able to get it into the boat) and then we took lots of pictures with the big guy before spending about 15 minutes reviving it and then sending it on its way back into the murky depths...


definitely an experience!


Actually, I think I am now officially Rick's lucky fishing talisman.... thats twice we have got huge fish together... :))

On Fire

For the last few weeks here in Vancouver, the weather has been really swinging toward winter. We are now solidly in the rainy season and there is snow on the local mountain tops. When the weather is cloudy (most of the time) the temperatures are around 10-12 degC in the day and 6-7 degC over night. When the skies are clear, its more like 3-4 degC overnight and in the teens if you are in the sun.

I was really enjoying riding around the place on my motorbike with all the fall colours on the trees. I found it very peaceful :)

Ive also been clearing out my garage of accumulated off-cuts of wood. Ive been sawing them up into smaller pieces and burning them off on my BBQ. My friend I-Fan is a bit of a Pyromaniac it seems and I barely got to play with the fire at all... Once she had the tongs it was impossible to get them back :)

I didnt burn all of the wood though. I decided I needed a guitar stand and I figured Id make one myself out of some of the wood. I wanted it to fit inside the guitar case with the guitar for easy transport. I turns out that this is quite a constraint since there is not that much spare space in the case. It took me a little while but I came up with a design that seems very functional and effective; Is attractive to my eye; And has no hinges or pins or clasps.
Its just four pieces of ply wood that slip together and it holds its shape by virtue of the flexed pieces of wood :)

Its good enough for public consumption in my opinion, so I plan to make one for my friend Marie in Guatemala too if she ever manages to send me the dimensions of her guitar....