The Economy is not regulated by equations. I graduated actually believing that the economy could be graphically and mathematically described using a complex series of equations. But economic models are not scientific models. Economic models are subject to so many assumptions, inputs and variables that beyond a very short period of time, these models become highly unstable and fail to fulfill their Keynesian fantasies. Even without regard to the fact that most economic models predate the first steps of our economic policy makers, a modern view of economics in context of the world today will be unlikely to provide a fiscal plan that ...well...plans.
A saying I learnt in University, and one that has the utmost of context within any discussion on economic forecasting, is 'Ceteris Paribus'. This latin expression was in daily use by one of my Economics professors. It basically means 'all other things being equal'. I.E. If if if. All other things are not equal though. While certain factors will have a greater impact within an economic model than others (interest rates for example), the long term outcome is an unknown due to the incredible number of variables over time. This is like adjusting your driving style without being able to see the road ahead. So if someone tells you their opinion on where the market is going, be polite and listen. Regardless of who they are though, they can't predict the future.
There are a countless number of blogs that appear to exist for no other reason than to painstakingly convince the aimless public of the imminent crash, or continued health, of the Canadian real estate industry. This blog will provide little, if any, commentary on where the market might be next year or whether you should sell or buy. This blog is not polarized towards any asset class in particular, but will explore a variety of factors related to real estate investment within a Canadian context. While I will not forecast any particular market, I will explore a wide variety of interesting topics. Coming discussions will centre on topics such as: Foreign ownership restrictions; large format development sites - win or fail?; taxation issues; and more. Where possible, I will include guest authors that have a specialization within specific areas. My next post will be ready for the first week of December, or earlier.
A saying I learnt in University, and one that has the utmost of context within any discussion on economic forecasting, is 'Ceteris Paribus'. This latin expression was in daily use by one of my Economics professors. It basically means 'all other things being equal'. I.E. If if if. All other things are not equal though. While certain factors will have a greater impact within an economic model than others (interest rates for example), the long term outcome is an unknown due to the incredible number of variables over time. This is like adjusting your driving style without being able to see the road ahead. So if someone tells you their opinion on where the market is going, be polite and listen. Regardless of who they are though, they can't predict the future.
There are a countless number of blogs that appear to exist for no other reason than to painstakingly convince the aimless public of the imminent crash, or continued health, of the Canadian real estate industry. This blog will provide little, if any, commentary on where the market might be next year or whether you should sell or buy. This blog is not polarized towards any asset class in particular, but will explore a variety of factors related to real estate investment within a Canadian context. While I will not forecast any particular market, I will explore a wide variety of interesting topics. Coming discussions will centre on topics such as: Foreign ownership restrictions; large format development sites - win or fail?; taxation issues; and more. Where possible, I will include guest authors that have a specialization within specific areas. My next post will be ready for the first week of December, or earlier.
