Saturday, July 16, 2011

July 16, 2011

Dear Kids,
    As far as I can see, the recession will come to Canada very soon due to the inflation rate comes to the point that most of the people couldn't afford to purchase a house.  It means that the household income can not meet the daily expenses such as the food cost and the gasoline price are coming up to the point people can't afford it.  Uncle Tony has 200K in the bank 10 years ago and he could buy a town house or a small detached house at that time.  Nowadays, he can only purchase a small condo with 600 sq feet.  it means all his money are taken away by the inflation.  Inflation means there are so much money in the market and all things are going up, therefore, the value of the money drops.  it means his 200,000 10 years ago and it is only worth 80,000 value for the today's value.  There is a common saying in English, "Money and fool will say good bye very soon".  If the fellow is smart enough, he can master the present situation so that he knows when he should buy it and what is the best time to sell it.  When you buy it, you need to watch the calculated risk to protect yourself so that you would not be hurt by the sudden fallen market if something unexpected happened.
    The reason why I say Canada's economy is going down because Canada's economy depends on the external factors.  USA is one of the factors for import and export because Canada depending on USA a lot.  However, the Canadian dollar is higher than US dollar, therefore, the export business will be affected by the US currency because US can't afford the high price of the Canadian product due to the exchange rate issue.  On the other hand, the importing business would not be booming because of the small population comparing to the USA.
Due to the recession, US has already reduce the expansion in Canada by closing the branches in Canada or layoff a lot of employees in Canada to keep the US company stable.  As a result, there are a lot of people who can't get a job will change to the other profession or leaving the country.  Most of the new immigrants who would like to leave the family in Canada to enjoy the free education or free medical facility and the bread winner will go back to HK, China or Taiwan to continue their profession or business.  Sooner or later, most of the families have the problem due to the parents are not running the family together.  Some kids became aimless unless the kids are especially smart such as Michelle and Ricky.  If you are not smart enough, the kids will lose the goal and wondering around instead of wasting of time.
    No matter what happens, you need to set a goal and move forward.  There are a lot of people asking about the opportunity during the recession.  What I can tell you that there are a lot of people who can make a lot of money during the recession if you are smart.  On the other hand, one can make money no matter what happens, you are always the winner if you are smart and alert to the news of the world day to day economy movement.       

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