Canadian (and American) Real Estate Outlook 2020

VIDEO TRANSCRIPT: I don’t think I should just say Canadian. I think I should throw American real estate in there too because Canada and the U.S. are kind of similar in some ways. So 2000 twenties coming big year. Why is it a big year? Number one, we have an American election. Now. American elections traditionally work like this when they have a president who’s in the white house right now it’s president Trump is 2019 I think it’s October. I’m shooting this. When there’s a president in the white house and the economy’s going good. Usually he gets a second term. So who is it going to be in 2020 probably Trump. There is nobody on the other side. Joe Biden sucks. If Hillary Clinton comes back, she sucks. Bernie Sanders, he sucks. Everybody else on the Democrat team sucks. So Trump will take it again. We’ll have president Trump again.

How The Economy Affects Real Estate

And the economy’s good. So when the economy’s good, usually the president gets a second term. So that’s happening. Now there’s another thing to keep in mind and this applies to Canada and the U S this is North America and North America and the world. When the president is in there for two terms and the economy is good. Sometimes what happens if you’ll recall a history after the president gets in for the second time. That’s sometimes when the economy tanks, now the economy might tank because here’s, here’s something that’s going on. Usually you have a load, a seven year cycle of the economy goes down, it goes up. That’s a seven year thing. We’re on a 10 year run right now so our run is way too long and you know Trump has been very good at keeping that run, that economy going. It’s on a 10 year run right now.

Real Estate Crash 2020?

Usually it goes seven years in a crash. We’re going to 10 years in a crash. Our last crash was 2008 that was a really bad crash and we’re going, you know, past 10 years into overtime. So that’s a tough thing to consider. So when you have that second president term right after he gets back in, that’s usually where they take off the edge and boom, we have a crash. Now I read the other day that the fed, the federal reserve is looking to expand their balance sheet, which means quantitative easing, which means inflation. So we’re probably going to see some inflation. Who knows? That’s something to really watch out for. Now, if you’ve been following Venezuela, Venezuela is a complete disaster. It’s a mess. That’s something you should go Google in Venezuela some years ago they had an oil economy like Canada, the U S it was a good country. It was a capitalistic system.

They went totally socialist. And now they’ve got bread lines where guys have tattoos to get bread. Cause that’s how they’re, they fucked their country up. And when you look at Venezuela, it’s really scary because we could go the way Canon the U S could go the way of Venezuela. If we keep our socialist ways going, if we keep putting socialism and socialism and we might end up with a tattoo for bread one day. Now here’s the thing. So 2020 you got an election. Usually after that second term election of the president, you might have a crash. Another thing is you’ve got inflation. The other thing that’s going on is interest rates are going down. So you’ve got countries over in Europe, I think it was Denmark has a negative interest rate where you can take a loan and it’s I think negative half a percentage point interest. So that means you take the loan and they’ll pay you to take the loan.

So we’re going into some weird uncharted territories with interest rates where I don’t really know what’s going to happen with that. The interest rates are going down, interest rates are going down. When interest rates go down and they’ve been down for so long, I mean they’ve been down, especially around 2008 when they started the quantitative. Using all this cheap, cheap, easy money came into the markets, made real estate inflate, made a lot of things, inflate a cheap, easy money has been out there for a long time. And the longer the economy spends on cheap, easy money with 2% interest, 3% interest, you know, 1% interest on some of these loans, the harder and harder it is to get the economy back up to a higher rate. So we’ve had the lowest rates in history historically, last 300 years, interest has been about 7% you know, right now we’re at 3% 2% 1% negative percent.

So that’s a crazy thing because we’ve never done this before. We’ve never been there before. And then, you know, especially in Canada, because I’m more familiar with the Canadian market, we have the Canadian government messing with the controls of who can buy a house and who can’t. They’re always changing things. CMHC, which is the insurance of mortgages, government insurance and mortgages. They’re always making it harder for the first time home buyer to buy. So we have this interesting time in history where you might have a crash after the second, second term president of Trump. We’ve also got the 80 year cycle of war, which is hard times create strong men. Strong men create good times, good times create weak men. Weak men create hard times. That’s an 80 year cycle. That cycle started in 1940 with world war II. It’s ending in 2020 so could there be a war?

Maybe could there be a U S civil war? Maybe people are getting kind of violent. There’s groups like Antifa out there who’s violent on the left. You’ve got groups on the right who are starting to get a little violence, so who knows? Or could there be a conflict with Russia, China and some currency Wars or petrodollar? You know, conflict. Who knows? That’s something if you want to study history, you can go read a book called the fourth turning by Strauss Strauss and Howe and that book marks every 20 years, every generation going back to the middle ages, the days of King Arthur almost, and they predict even in that book that we’re going to have some sort of did either be a petrodollar conflict or even potential civil war. Now the other thing that’s coming in the next few years, that’s also a scary, and I’ve said this and video after video after video and people sometimes disagree with me in the comments, is that democracy, the democratic process only lasts for 250 years.

America was born in 1776 and you had 250 years. So you’ve got 2026 is the end of democracy. And the reason why democracy only last 250 years is because the people were weren’t that they can vote themselves prizes, free shit free shit free shit free shit, free health care free, everything free, free, free. And we’re at this point right now where you watch the Democrats in the debates, you know, recently on TV and everybody’s offering free shit. That’s, that’s the platform free shit, free shit, free shit. And what happens is the fiscal irresponsibility of the system collapses when everybody wants free shit. And what happens after that 250 year period is democracy ends. And you go to a tyranny, which is like an EMP. It’s an emperor, an empire. It happened in Rome with Julius Caesar. I know some mother fuckers in the comments will say, but America is a Republic.

Yeah, sort of dude. I mean officially you’ve got the, you got the electoral college who can protect from that, but the sentiment is, yeah, we vote, we decide. We popularize things. So who knows what’s gonna happen with that? So he got 2020s a crazy year. 2026 could be a crazy year. Now, if you’re buying real estate, here’s what you want to do. Only own choice, real estate, good real estate stuff that you’d be happy to have for 20 or 30 years. You want that stuff. Don’t take on too much debt. Don’t take on too much longterm debt. If you wouldn’t own it for 30 years right now, don’t buy it. You want choice buildings, choice dirt. Make sure you got cashflow. Be prepared to marry every building for 20 or 30 years because you don’t know right now what’s going to happen. I think we’re going into a bit of volatility.

Should I Buy Real Estate in 2020?

I’m not saying don’t buy, but I’m saying if you’re buying, make sure you’re buying the best stuff because only the best stuff is going to survive the next little bit. And you know with interest rates they could spike up. That’s happened before in history where they spike the interest rates up to smash the weak players in the economy. If that happens, I hope it doesn’t happen to you. Real estate prices would go down. That would hurt a lot of people. That’d be very bad for the economy. I hope they don’t spike. I hope they continue to go down. I hope they stay down. Probably will. But this is a time in history where you don’t know what’s going to happen. Man. Inflation probably is going to happen. But you know, when you look at countries like Venezuela and you see how they’ve gone, that’s something you should go do out.

If you’re watching this video, go study Venezuela and see how things went down over there. Cause they used to be a very sophisticated country. You know, they had a good air force, they were a good, strong oil economy, and now they’re in bread lines with tattoos to get bread from the government. So things went really bad for those guys. It could go like that in Canada. It could go like that in the U S so you need to keep your eyes open right now. Get choice buildings, stuff that you would not sell for the next 30 years and keep the good stuff. Go read Strauss and how to, it’s a the fourth turning. Great book. I’m Stefan Aarnio and Hey, if you haven’t read hard times, create strong men yet. Go get that one too. That’s one of mine that kind of piggybacks off of strokes and how a little bit fourth turning like share, comment, subscribe to my channel. I’ll see you on the next video.