Remember Enron?

Remember Enron? It brought about the end of the financial world as we knew it, didn't it? No? Well, the collapse of Lloyd's of London sure did! No, again? How about 9/11? Or the Savings and Loan scandal? No and no, right? Heck, I'll bet that few folks even remember the Savings and Loan story. It was a real disaster, on the scope of the current situation, but it didn't cause anything like the 'great depression' so many ‘experts' are predicting now. I believe that's due in large part to the fact that the hyperbole usually far outweighs the reality. Things may be bad, but they're not THAT bad!

Of the above-mentioned financial calamities, only the Savings and Loans scandal seems to have contributed to a real recession (in 1990-1991). The rest made for spectacular headlines in the financial media, but didn't have a strong negative impact on the economy or housing market. So why should we fear that this market correction will be so bad? So-called capitalists broke the rules of capitalism, and now the 'invisible hand' is giving them a spanking. Now, for better or worse, governments are taking steps to sooth their aching behinds.

I'm not sure why the media spent almost all of '08 browbeating Canadians into believing in a recession - thus creating a self-fulfilling prophesy of sorts. (Check out this story on Canoe Money: "Media adding to economic woes, experts say" http://money.canoe.ca/News/MediaHold/2009/01/07/7947796-cp.html.) I guess it's because bad news sells. Nonetheless, record-breaking retail shopping in Canada over the holidays clearly shows that millions of Canadians just don't believe that the sky is falling. They must be telling pollsters that they are worried - consumer confidence numbers are very low - but then they're going out and spending like they're NOT worried! Giving the choice between believing words or actions, I'll take actions any day.

The moral of the story is that we shouldn't get caught up in the hype. We'll ge through this slump, just as we always do. Be smart, be careful, but don't miss out on any opportunities that may jump out at you - especially (drum roll please!) in the Toronto real estate market! As surely as the current slow-down will pass, so too will the great prices that we are seeing on houses and condos all across the GTA. Take advantage of this extremely rare opportunity to buy in Toronto. Start by calling us today!