City
Vancouver After The Crash: A New Hope
Vancouver has always existed in isolation. Surrounded by mountains, ocean and a border. Cut off from our capital and taking cues from Seattle, Portland, San Francisco, and Tokyo. The same conditions that were characterized by The Vancouver School in their preoccupation with the frontier. And yet we are completely dependent on these external forces. Well perhaps those forces came to a head this past week when the US stock market took the worst hit since the Great Depression. Indeed, as freakonomics professors in the New York Times pointed out, "The Fed has never asserted its authority to intervene on this scale, in this form, or in a firm so far removed from its own supervisory authority".
So what does this mean for Canada? For B.C.? Surely the late, great, Vancouver Housing Blog had it right- this is the bursting of the housing bubble. But is this The Crash? Are we going to see the effects immediately? Am I just some misanthrope who envisions crumbling streets, flooding, and gangs of wild children on bikes stealing gas to trade for candy?
"Yes", according to local artist and dreamer Andrew01. "You have a very different outlook than I do. I think artists sort of exist in a parallel universe. I mean, the price of art never goes down. It never depreciates. Look at Brian Jungen's masks which sold for $180,000 at Sotheby- he was selling those for five thousand". He says. In retort I ask, "Who's going to buy the art if everybody's broke?". "There will always be a market for art". He replies. He tells me that Toronto still thinks New York is the centre of the universe, and that the art world is just shifting. "When the Romans invaded, the Greeks thought the universe was ending". He goes on to explain, in his particular manner, that he's ready for the Chinese to take over, after all he speaks Chinese and he married a Chinese woman! But he has a point. Just because America's economy is in turmoil, doesn't mean we will follow suit.
Indeed, this seems to be reflected in the United Nations where Western influence wanes as power balance shifts. So will the Asian markets come to the rescue? Is China simply the next superpower? Will our bounty of forests and sea sustain us? Will we be thankful that Vancouver had the foresight to save land for farming by creating the Agricultural Land Reserve? Are today's revolutionaries growing their own food? Will our real estate values plummet, or stay the same? Does Andrew have it right? Am I being too pessimistic? Maybe I've just watched Gattaca too many times. I'm just so scared of an economic system that doesn't subtract. It just keeps adding.
photo by Jerm9ine
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Don't worry. Dubya's totally on it. Heckuva job.
$700 billion dollar buy-out of all American based bad debt, that's what Paulson's going to try and get Congress to approve this week, and that's after the saving of Bear Sterns, the buyout of Fannie and Freddie, the fire sale of Merill Lynch, the saving of AIG, the bankruptcy of Lehman Bros. and the now Morgan Stanley is in 'merger talks' this weekend.
So far so kinda ok for Canada, only CIBC really got hit with any major write-downs. But we're commodities, so we better hope China keeps building. That 800 point rally on Friday was one of history's biggest short-covers.
All in, this whole debacle is going be well over 1 trillion, and will result in the US nationalizing an entire whack of their economy...and who said there was no real left movement in Washington, but necessity makes for strange bedmates I guess.
Point being, when the world economy is facing a financial shit storm of over 1 TRILLION DOLLARS, you're tell us to...buy art?
Thank Sean, do fries come with that?
The impact on Vancouver is a decline in the tourism and forestry sector. However, our marijuana trade will take us through these tough times.
This past week you heard cries of the second coming of the great depression. Not likely as during the great depression unemployment was at its peak 25% what are we at right now in the states 6%. The poor souls that lost there investment banking jobs will find jobs else where in the world and soon. The government bailout was necessary and now the good ole US of A can't claim to be the great capitalists that they are. Welcome to socialism mother fuckers.
I had two friends that worked at Lehmans and lost their jobs. They are coming back home a bit earlier than they expected and one already has a job with TD. The other is taking a few months off and then planning to work with HSBC. So I ain't worried about the Wall Street fuckers. They caused this mess. Main street and mid to low income families will get hit hard.
And yes you are too pessimistic. A little optimism from time to time doesn't hurt anyone.
It was a depression-like scenario, but in 1929 it was a retail run on the banks, in 2008 it was a wholesale run.
The story going forward is going to be inflation BIG TIME, and a general re-assessment of standards of living. To quote Paulson's understatement of the year "we have to work off the excess."
-----But buy art...you'll be okay 'Sean Orr'
You're right, Main Street, will take a beating for this, and most of them won't even know why.
But then, it's them these sub-prime shit sandwiches were valued on. But then, again, its the white-collar Wall Street boys that made the decision to lend to them in the first place. All in, you're right in your blog Urban Dweller, greed's always been the game.
QT, it was greed on both parts. The lenders and the borrowers. The lenders were preying on the stupid and the borrowers were chasing the "American dream" of owning your own home. Main street got duped and now they'll pay most of the price. Obviously Wall street needs to be held accountable. My question is why wasn't the government stepping in knowing full well what was going on with these predatory lending practices.
I knew someone that use to work at Country Wide Financial in California, those assholes screwed a lot of families. This guy wasn't even qualified for the position he had, he was a glorified sales person. He had no clue what that he was trapping the Main streeters into eventual foreclosure.
Art, pfft...I'll make more money shorting stocks in a week than investing in art. You just got to be fully informed and adapt to the market. However, art would cause less stress.
The government was out to lunch so to speak, nothing really out of the ordinary for this administration though. Everything's easy to talk about in hindsight, but Bernake might have been the wrong choice for Fed Cheif as well, too much of an academic in a position that needs to act before all the data is in, but Greenspan gets some blame then too for 1% rates.
Um... Did I say "buy art" anywhere in this article QT? No. These are the words of artist Andrew01, hence those little gems of punctuation, the quotation mark. They look like this: " "