To The Pointwith Boris Bozic
Commentary, Opinions, Thoughts and Discussion on Current Events, Politics and The Mortgage Industry

0 Comments It Must Be Spring

Article written by on the 29 Mar 2012 in CAAMP

ontario-budget-cutsThere are signs that spring is really here.  No, it’s not the lack of snow on the ground or the unusually mild temperatures we’ve had here in Ontario.  It’s definitely not about the Leafs playing hockey beyond the regular season.  My understanding is that’s when the Stanley Cup play-downs or playoffs or whatever the hell they call it begins.  My memory fails me as I get older, and it’s hard to remember what hockey in the spring time is like in this city.  It’s not about a new baseball season which begins in one week.  No, it’s spring time because it’s budget time…isn’t that exciting boys and girls?   

Our “Daddy Premier” in Ontario gave everyone some bad news this week, especially if you’re one of the 1.2 million public servants in this province.  The Liberal government announced a wage freeze for all public servants, and they don’t mind biting the hand that voted for them.  According to the Ontario Finance Minister Dwight Duncan, the government will legislate a wage freeze if one cannot be negotiated.  There’s 4000 labour agreements in place today.  This has job action, strikes, rallies and public demonstrations written all over it.   The gauntlet may have been thrown down in the spring but this will carry forward and ensure a winter of discontent for us here in Ontario.  Never mind that all the austerity measures are necessary, and that the minority Liberal government had no choice but to ontario-provincial-budet-2012address the fiscal disaster which is the Ontario budget, the opposition will skewer the Liberals over this budget.  That being said the Liberal government doesn’t believe the opposition has the stones to defeat the government over this budget, resulting in an election.  This is a high stakes political game of chicken, and I suspect the Liberals are counting on the support of the NDP.  I think a deal’s done already. The Liberals have changed their mind on reducing corporate income to tax to 10% by next year.  The new budget states that corporate taxes will be frozen at 11.5% through 2017-2018.  That’s reason to celebrate in NDP world, and it’s not as if the Liberal and NDP haven’t openly discussed being bed buddies in the past.  Sure, those discussions have been at the federal level but I suspect their provincial siblings have taken note.   The next part of the process is for the liberals to stand up and pat themselves on the back for being responsible and doing what’s necessary to fix the problems we have in Ontario.  Really?  That’s like an arsonist  taking credit for helping to put out a fire he started.

I was reviewing all the cuts, wage freezes and cancelled programs when I came upon one initiative in the budget to increase revenue that made laugh out loud.   The Liberal government plans on opening up 25 new and larger liquor stores in Ontario every year.   Here’s what that means, “as a government we’re financially and morally bankrupt, we’re fiscally incompetent, we couldn’t organize a one car funeral…so come on Ontario…let’s get hammered”.

There’s another budget that we’ll be hearing about today, tomorrow and the day after and so on.

The Federal Budget will be introduced today, and there’s been a fair bit of speculation  as to what it may contain.  I’ll refrain from adding anything more to the speculation, and wait for the actual details before commenting any further.  You may not be aware of this but Jim Murphy, CAAMP President, was invited to Ottawa by the Finance Department to participate in the budget lock-up process.  These invited guests are sequestered in a room, and they get to review budget, spending plans, back ground papers and the actual speech before it’s delivered.   It’s also an opportunity for Jim to speak to senior government officials who will also be present.  It really is an honour for CAAMP, and Jim, to be invited to the sneak preview.  For those of you who may have missed CAAMP’s most recent message about their government relations effort, I encourage you to watch the video below:

Until next time.


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3 Comments Mortgage Industry: How Refreshing

Article written by on the 27 Mar 2012 in Mortgage

Straight talk from a politician is rare and yet when we hear it we still look for the underlying message.  We are conditioned to look for what wasn’t said.  I have a great deal of respect for Minister Flaherty, and his willingness to speak in clear terms.  That’s not easy for a politician to do because it opens them up to criticism and it gives them little wiggle room if they want to back track.  You may not agree with what Flaherty has to say but at least you know where he stands on issues.  Minister Flaherty gave a speech in Stittsville, Ontario last week, and it was another example of straight talk.

His speech was about the state of the Ontario economy, and his thoughts regarding the pressure being put on the federal government to further tighten mortgage rules.  There was no ambiguity in his speech, here’s what you may have missed in his speech:

“I find it a bit odd that some of the bank executives are taking the position that the minister of finance or the federal government somehow should tell them how to run their business.  We have bank executives in Canada going and saying ‘really, the rules on insured mortgages should be tightened up.’  They must forget that they are actually the ones that issue mortgages.  It’s their market.  It’s not my market.  They decide what they want to charge in interest rates.  They’re the ones that make the profits out of this business, so I find it a bit much when some of the bank executives turn to the government and say ‘you ought to change the rules and make it tighter.’  It’s very interesting commentary from them.”

Try as I might but I can’t find a hidden message in the statement above.  No Clinton like speak here.  The message is clear and what else is clear is that some bank executives got a verbal public spanking.  For months now the pressure has been relentless that the government must act and tighten mortgage rules.  The fact that some of those that are sounding alarm bells have introduced or decided to follow the irrational interest rate pricing game is “special”.  Let’s see, “we’re concerned about consumer debt so we’ve decided to lower rates so consumers can take on more debt, and add gasoline to an already hot housing market.”  Alex, I’ll take double speak for $200 please.

I understand and agree that the concern about consumer debt is real, and it needs to be addressed.  The Bank of Canada, and the Ministry of Finance, are walking a tightrope.  Cooling down the housing market, while not negatively impacting the overall economy, is not an easy task.  Recently CAAMP provided a report to the Ministry of Finance about the impact of the housing industry has on employment in Canada.  The report was written by Will Dunning, CAAMP’s Chief Economist.  I encourage you all to read the report, and to receive a copy please visit CAAMP’s website at

Here’s a few highlights from the executive summary:

  • The housing and mortgage industry has been particularly important to job creation these past 5 years.  From 2006 to 2011, it’s estimated that 18% of all job creation occurred as a direct and indirect result of growth in the housing and mortgage sector.
  • The biggest threat to the health of the Canadian housing and mortgage industry is a recession that results in job losses.  The best way to support the housing and mortgage industry and to sustain its positive impact is to pursue policies that continue to create jobs.  At the same time it is important that qualified buyers have choice when seeking mortgages to finance or re-finance their home.

As an industry we have a responsibility to the government to provide facts, which ultimately can assist the government with a safety net.  Is our message getting through?  All I know is that the government decided to not change the mortgage rules at this time.  I would like to believe that our efforts to date have had a positive impact.  One thing I am certain of is that we have to stay the course, and not talk through both sides of our mouth.

Until next time,


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7 Comments Mortgage Rules: The Heat is Getting Turned Up

Article written by on the 22 Mar 2012 in Mortgage

Media coverage of “consumer debt” and “inflated home values” in Canada has been relentless.   The national newspapers have used up plenty of ink to cover these stories.  There’s been no shortage of so called experts willing to quote on these issue.  Opinions range from mild concern to abject hypocrisy.   Given that the temperature gauge has risen significantly over these issues, I have to assume that the federal government will be forced to respond.  This is not a story with  24 hour life cycle, and the government will want political shelter if the so called experts are right.

 I have a great deal of empathy for the good folks at CMHC.  For some time now they’ve been in cross-hairs.  The press, economists and some within the financial sector have taken liberties as it relates to CMHC’s credibility.  Does anyone really believe that CMHC does not know what it is doing?  That they do not have the required expertise to manage their business?   That they would act recklessly or in some way irresponsibly?  The answer clearly is no.  Yet, there’s been coverage recently about CMHC’S solvency.  Their financial statements clearly show that they have enough capital on hand to withstand market variances.  They continually run stress tests to ensure their financial viability, which equates to being responsible to the tax payer.  Their most recent stress test indicated that insolvency was not an issue, with the following caveat.  Our economy would have to go into  multi-year recessionary period, and unemployment would have to reach 13%.  Who among the so called experts are willing to put their reputations on the line by guaranteeing that dooms day scenario?  I suspect not many.  As for 13% unemployment, could it happen?  Certainly, it reached 13.2% in December of 1982.  Anything can happen but the question is what’s the probability?   That’s what CMHC manages day in and day out, and from where I sit they’re pretty damn effective.

 As for the other favorite target, the Ministry of Finance, I find it fascinating that some within the financial sector are publicly  stating that the government must act now and tighten mortgage rules.  They suggest that we’ve reached a critical stage, consumer debt it too high, home values are inflated.  Really? If that’s the case why don’t they do the responsible thing and act independently.  They could change their credit policies tomorrow.  If they believe that the government should change the mortgage rules  to reflect a maximum 25 year amortization, a minimum down-payment of 10%, and that borrowers should be qualified at the 5 year posted rate, then they should be prepared to lead by example.  If they’re not prepared to lead, and do it on their own, we have to assume that present day circumstances poses no risk to their share holders.  For if it did, they would do the right thing.  Just like the folks at CMHC have been doing.

 Until next time.


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0 Comments Canadian Banks: The War of the Worlds

Article written by on the 20 Mar 2012 in Mortgage

canadian-banks-like-bearsThere’s been no shortage of change, news or predictions about the economy, and specifically about the mortgage industry since the beginning of the year.  It’s hard to keep up and to determine what’s vogue.  By all appearances one issue that won’t go away is the call for more changes to the mortgage rules.  That’s the one constant drumbeat in this symphony of industry news.  But if you listen closely you’ll hear something that we’ve rarely ever heard before, banks talking smack and taking dead aim at each other.

Historically speaking the banks have always adhered to their own version of “Marquess of Queensberry” rules.  They battle for profitability and market share supremacy within a pragmatic framework.  The oligopoly has a good thing going and it’s their best interest to play nice.  That’s always been the case, until now.  I heard an ad on the radio today that made me take notice.  The largest bank in Canada is advertising that consumers should be careful of another banks offering.  They didn’t mention the other bank by name but they did refer to a 2.99%, five year mortgage.  Gee, I wonder who that might be.  The consumer is being warned to read the fine print, and not to make a decision in haste when we, Canada’s largest bank, can offer the same rate with all the privileges, minus 12 months of term.  What we have to offer is better than what the guy across street is offering.  There’s no vagueness or ambiguity in the messaging.  Could this form of advertising change the way banks operate and compete in the market place?  If it was to happen it would take some getting used too but in some ways it be refreshing, and I suspect a tad entertaining.  But alas, I believe this is a one off situation.  I think this is a case where the big boy sent a message to one his competitors.  The message? Play nice and let’s all get ours.  If you don’t, we’ll respond in kind.

One thing I learned over the years is that you don’t go around poking a bear in the eyes.  It doesn’t matter if you have the will or disposition to battle.  When the odds are stacked in the other sides favour, you act wisely.  It’s been my experience that the bear will eventually regain full vision, and respond by kicking you in a region of your body which is due south of your eyes.

Until next time.


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3 Comments Family Vacations, An Exercise In Crisis Management

Article written by on the 15 Mar 2012 in Personal

We love our home in Florida.  It’s a great place to go to decompress and leave the real world behind.  I’m not suggesting the real world doesn’t follow us, technology and commitments see to that.  However, when we’re away we’re not slaves to our blackberry and telephone.  It’s a great place do as little as possible, and that’s great unless you bring your 10 year old along.  Our home in Florida is in an established neighborhood.  We’re in a gated community, right on a golf course, an adult play ground.  But it can be a little challenging if you’re trying to keep a 10 year old occupied. (more…)

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2 Comments On Vacation

Article written by on the 13 Mar 2012 in Personal,Travel

Another March break is upon us and in our household that means it’s Florida time.  Canadians migrate to Florida this time of year with the same enthusiasm as a fat kid  attacking a bag of Smarties.  Got to get it all in, now!

Family vacations in Florida can be a whirlwind, especially for families that make the pilgrimage for one week.  It’s not easy fitting in Bush Gardens, Universal Studios, Cape Canaveral, Lego Land and the number one attraction in Florida, Disney World, all in one week.  Ah Disney World, where dreams come to life, and spankings become a reality because the kids have been rotten &#$@’s for the entire day.  I’m just kidding, everyone knows that spanking is yesterday’s discipline.  (more…)

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0 Comments Courage – NHL “You Can Play”

Article written by on the 08 Mar 2012 in Hockey,Sports

Courage – that’sNHL Sexual Orientation a word often used to describe hockey players.  When I think of NHL hockey players the following words come to mind – grace, sandpaper, skill, grinder, speed, aggression, artistry and violence.  As fans we’ve come to accept and cherish the juxtaposition that is hockey.  We cheer the poetic grace of a magnificent goal and yet we’re equally comfortable getting out of our seats to witness two players attempting to rearrange each others face with their fists.  Hockey fans are a different breed and at times the sport resembles no other.  Two teams can be engaged in a brutal seven game playoff series,  (we’re not familiar with that in Toronto) and when it’s over both teams will line up at center ice to shake hands.  No other team sport does that.  To me that’s what makes the game and players special.  We can now add other words to describe NHL hockey players – social conscious.

You may have heard by now that NHL players filmed a PSA (Public Service Announcement) entitled “You Can Play”.  If you haven’t heard about it, the PSA is about creating a level playing field in hockey, regardless of sexual orientation.    The man behind the PSA is Patrick Burke, a scout for the Philadelphia Flyers and the son of Brian Burke, general manager for the Toronto Maple Leafs.  Patrick and Brian are honoring Brendan Burke, who was openly gay and tragically killed in an auto accident at the age of 21.  The Burke’s lost a family member, and now they turned to their extended family for help, professional hockey players.

I was blown away when I first saw the PSA.  To have some of the biggest names in the sport supporting the cause and lending their voice to the issue is an act of courage.  No other sport has come close to doing anything like this and they probably never will. I could never see the NFL, NBA or MLB doing this.  Those athletes just aren’t wired the way hockey players are.  There are some nasty and tough players in the NFL.  They’re rip your head off tough – but tough enough to say it doesn’t matter if you’re gay, you’re still my team mate?  I just can’t see it.  Which is probably what caused the ‘wow’ factor for me when I first saw the PSA.  Of all sports only hockey players would do this.

If I take part in a hockey pool next year I will pick the following players, Rick Nash of the Columbus Blue Jackets, Duncan Keith of the Chicago Blackhawks, Brian Boyle  of the New York Rangers, Matt Moulson of the New York Islanders, Joffery Lupol of the Toronto Maple Leafs, Claude Giroux of the Philadelphia Flyers, Daniel Alferdson of the Ottawa Senators, Scott Hartnel of the Philadelphia Flyers, Corey Perry  of the Anaheim Ducks, Andy Greene of the New Jersey Devils, Dion Phaneuf of the Toronto Maple Leafs and Henrik Lundqist of the New York Rangers. 

These guys are tough, and they’ve got courage.  If you want proof, watch the video.

Until next time.


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0 Comments The Stories We Tell

Article written by on the 06 Mar 2012 in Personal

I was at a conference yesterday scouting some potential speakers for the CAAMP, 2012 Mortgage Forum.  Our co-partners, The Art of, hosted a conference yesterday and I wanted to get a firsthand look to see if there was a fit.  There were a number of speakers who would bring value to the upcoming CAAMP conference, and we’ll start announcing the speakers we start locking them up contractually.  I listened to one speaker today and all I could say was, “you got to be kidding, all that before you’re 30?”

Randi-Zuckerburg-The-Art-OfI’m referring to Randi Zuckerberg.  Yes, that Zuckerberg.   (more…)

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1 Comments Federal Budget: This Could Be Nasty

Article written by on the 01 Mar 2012 in Canada,Current Events

2012-Federal-BudgetFinally there’s a sign of a federal budget, and me thinks if this was a “good news” budget we wouldn’t have had to wait until March 29th to hear the glorious details.   Pundits are speculating that there’s a difference of opinion between the PM and Minister of Finance.  They’re both in agreement that austerity measures are necessary but the difference of opinion appears to be about degrees of pain.  The thought is that the PM wants deep cuts now, and hopefully the voters will have forgotten by time the election comes around.  The Minister of Finance is focusing on today, and he’s concerned deep cuts may negatively impact an already shaky economy.   Who’s going to win this debate?  My money is on the guy who sits in the big chair. (more…)

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