No offense taken. I am one of many who are somewhat concerned that some Canadians have buried themselves in debt which they’re just barely able to service at the current low rates.

Human nature is a funny thing. One would hope that when rates fall we would be inclined to take on a home at a substantially lower cost. Instead, what seems to happen is that people take the opportunity to buy more house at the same cost. It works today, but you have to wonder about the fall out in three to five years time.

“Gov’t bailouts delay the inevitable and commodities rise and fall in cycles and can not be counted on for sustainability.”

You are right on all points. However, what can western economies really compete on other than resources? It’s the only area where our high labour costs are not a limiting factor. Manufacturing and technology are great but the only places we can compete are in niche markets. As soon as technology becomes main-stream, someone figures out a way to ‘optimize’ the process and ship those jobs offshore.

In general, I would not count resources out. Our unemployment numbers are proof enough of that. Even the bears on this board have pointed out that Australia has started raising interest rates. This is due to the strength of Australia’s resource-based economy.

There will come a time where the resource boom will crash to a horrible end but this isn’t it and it is quite likely it will happen when the economies of the world reach the end limits of their government stimulus spending. In that event we’re all screwed anyway.

Well if the Globe and Mail said it….It must be true… I think that if you asked some oil people in Southern Sask. and the Lloydminster area, they wouldn’t be beating their chests too hard at that comment. I deal with retailers in both those areas and there is some long faces around there.
While it’s true that “some” of Asia has not been nearly as impacted as we have been, hello China…..other areas have been. Japan is still in a world of hurt and doesnt look like it will come out of that soon due to staggering increases in labour costs. Quality electronics…the stuff from Japan, not the crap from China has been going up in price with 2010 product and the same goes with motorcycles.

Although I’m sure I’ll be called a doom and gloomer, my 28 years in business management of which 16 were in finance…and have gone through a couple of these recessions, there HAS to be an economic “cleansing” after a period over indulgence like we’ve had for the last few years. Gov’t bailouts delay the inevitable and commodities rise and fall in cycles and can not be counted on for sustainability.

Do I like whats going on? No. My income has dropped 30k this year.
Do I believe this has to happen? Yes. It’s the only way to get back to core financial fundamentals. I feel bad for those who bought with minimum downpayments and qualified only because rates are so low. Where will they live in 3-5 years when rates are back to historic norms…. A lot of lemmings will be wondering what happened.

Norm, It wasn’t my intent to disrespect your board with comments on recent real estate purchases. Not everyone is in the situation I described.

However, not everything is gloom and doom. For example, as recently as yesterday: Globe and Mail November 10, 2009. “Saskatchewan oil play gains momentum.” Saskatchewan is mentionned as a current “world class play.”

By the way, potash will not be down forever. And, after all, it helped pay off 40% of the provincial debt last year.

Yes, I’ll certainly agree that the government projecting large amounts of provincial revenue based in commodities without taking global demand destruction into account was more than a bit “short-sighted”, shall we say. To take your point a bit further, it’s not taking it as “money in the bank” that’s the issue, it’s taking it as *future* money in the bank and spending it today that’s the problem. I’m not as pessimistic as you on several points, though: there’s much more foreign investment in Canada and our commodities now vs. the 1990′s, and this is helping lift the CAD vs. the USD. While this isn’t so good for provinces based in manufacturing, we should at least continue to do comparatively well. Foreign investors have plowed billions into the Canadian markets since the credit crunch, and year-to-date, have added nearly $70 billion of Canadian securities to their portfolios. There’s also been a large amount of growth and development in the Asian economies (which were much less affected by the financial mess) and they will need commodities to continue to develop. This is not to say that we won’t need to be competitive in pricing those commodities or that the government can rest on it’s laurels in terms of marketing them, of course. The unemployment rate in SK continues to be the lowest in the country, and given the rather huge unemployment rates in places like southern Ontario, I think it makes sense to bring people here to help them find work. You also make a point about housing and interest rates, but don’t forget that this is going to be an issue everywhere. It may in fact be much more of an issue in places where housing prices zoomed past prior highs based purely on low interest rates, creating insane bidding wars regardless of the local economy. To my knowledge not much of that has happened here.

Peter, “You cynics can be damned. Saskatchewan is still a safe-haven.” Are those gonna be your famous last words?

So, it’s official: Saskatchewan is in a recession, and there isn’t going to be much (if any?) of a budget surplus. Or any real growth. Not any surprise, really; the worldwide recession was bound to eventually impact here, and a few of us have been cautioning about assuming past commodity revenues and royalties would continue to apply in future years/budgets.

In other news: Saskatchewan likely facing recession by end of fiscal year: finance minister: http://bit.ly/3mueQE

“REGINA — Saskatchewan’s economy will shrink in 2009 and the province will likely be in recession by the time the year is over, Finance Minister Rod Gantefoer said Tuesday.
Gantefoer chalked up the government’s financial woes solely to potash, which he said is at the lowest volume of sales since 1972.

The government’s spring budget projected 20 per cent of its revenues coming from potash. But in its first-quarter financial report in August, it downgraded those revenue projections by an unprecedented $1.3 billion. The current figure of just over $600 million will be revised even farther downward next week. Going down as well will be the government’s economic growth projection for the province, which began at 2.1 per cent in the budget and was downgraded to 0.6 per cent at first quarter.”

The City of Saskatoon is planning a city-wide green bin recycling program in an effort to curb a looming garbage crisis and divert household organic waste from the landfill, officials say. “If we don’t take some significant action in the short term, we’ve only got 12 years of landfill life left and we know we can make the most significant impact with organics.” What exactly will be collected and how much the program will cost homeowners is still being worked out, said Ryan O’Grady, the city official in charge of the organics program.

In actuality, it’s probably less than 12 years based on the city’s current growth. It would be great to see a combination green/blue box recycling program. But kudos to the city for finally getting something like this started!

Over the past few months, one side has been fetching $205,000 to $225,000. Three full semi-detached properties have sold ranging from $395,000 to $437,000.

I think, if we were to go back to 2005 and earlier when inventory was a little more stable, 700 listings was more or less normal for this market. At that level, we would have expected to see some modest upward pressure, but not too serious. I expect that we may very well hit that number before the year has ended but theoretically, we should see demand declining as well, and inventory can start to climb fairly quickly in the new year. Personally, I wouldn’t let the fear of price increases rush you before you feel ready. Even those who are typically most bullish are predicting very modest price growth next year. Of course, interest rates continue to be attractive and it may be worth trying to get in on that while they’re low, but it’s important to purchase with future rate increases and affordability in mind.