Dear Santa,

I just want you to know that this is my favorite time of the year.  I know how busy you are because I see you at Christmas parties, at the mall, on T.V., and pretty much everywhere; must be the magic of Christmas.  I don’t want to bother you but I wanted you to know that I have been a very good boy this year.  Oh, some of the other boys and girls in the mortgage industry may not agree, but they’re just poo-poo heads.  Is that a bad word Santa?  If it is…I’m in deep $%&!  Oops, looks like mommy is going to feed me some more Irish Spring for dinner…please don’t fill her stocking with soap this year.  Santa, I’m writing you this letter not for me but to give you some ideas what to get for other boys and girls.  I decided to do this after watching Ellen with my mommy.  She is always giving stuff away on her show, and when she does people are really happy.  All I want this year is for people to be happy…pinky swear!   Here is my list of different gifts you can give for some other boys and girls.

1. Justin Trudeau –  Zig-Zag rolling papers
2. Jim Flaherty – A Monopoly game, he really loves real estate
3. Mayor Rob Ford – Socks, to wear or stuff into his mouth
4. AL Gore & David Suzuki – A Hummer
5. Kathleen Wynne, Premier of Ontario – A subscription to the Toronto Star.  It’s the newspaper that ignored her  in favour of Rob Ford
6. Miley Cyrus – Therapy
7. President Obama – A Pinocchio doll
8. Billy Bob Jackson from Mobile Alabama – A gun…he’s the only American without one
9. Prime Minister Steven Harper – A hockey stick…to beat Mike Duffy with
10. All the mortgage brokers in Canada – A time machine…so we can all go back to 2006

Thank you for reading my letter Santa.  I have a special surprise for you when you come down my chimney.  Instead of milk and cookies, I’m going to leave a snifter full of Courvoisier XO cognac, a plate full of thinly sliced prosciutto and a Rocky Patel #5 cigar. I figured you might like that – given the odor when I sat on your lap to get my picture taken at the mall last week.

Until next time

Merry Christmas and Happy Hanukkah

Dorothy, Am I in Kansas? I ask because of the headline I came across this week in the Globe “A word to the doomsayers: Bank of Canada sees no housing crash”.  Seriously, where’s Glenda, the good witch of the North and the munchkins? It is pure fantasy to suggest the market is not going to crash.  Who would dare predict the “impending” crash will not result in the total decimation of our economy?  What snake oil salesmen would utter “soft landing” to describe the risk associated with the housing market in this country? Stand up and be counted.  Surely it cannot be someone in the know – unless of course you consider the Bank of Canada Governor, Stephen Poloz, as someone not in the know.

I get it, a mayor smoking crack, partying with escorts and hanging out with gang bangers is far more salacious, and garners eye popping headlines.  Throw in Rogers Communication paying in excess of $5 billion for the exclusive rights to televise Canada’s religious pastime, hockey, and it is understandable why something boring like an okay economy, and housing market not on the precipitous would get such little ink.  Frankly, as far as press coverage regarding the housing industry, this is the best we can hope for.  So when we hear the Governor of The Bank of Canada say, “The housing sector has been stronger than expected but is consistent with updated demographic data and a pulling forward of home purchases in light of favorable financing conditions”.  Excellent – a statement that elicits a yawn.  Or how about, “The Bank continues to expect a soft landing in the housing market”. Almost makes you sleepy.  I guess I could rant against the notion that the Bank of Canada “continues” to predict a soft landing but that would require energy, and I would need to take a nap first. 

As exciting as it is, the press may become bored with our industry, trust me, other words will be found to sell papers; words such as ‘bust’ and ‘bubble’ may be replaced by ‘disinflation’.  According to Investopidia, “Disinflation is commonly used by the Federal Reserve to describe situations of slowing inflation. Instances of disinflation are not uncommon and are viewed as normal during healthy economic times. Although sometimes confused with deflation, disinflation is not considered to be as problematic because prices do not actually drop and disinflation does not usually signal the onset of a slowing economy“.  By all accounts the Bank of Canada will be speaking to this issue going forward.  One way to combat disinflation would be if the Bank of Canada lowered the overnight lending rate.  Alex, I’ll take irony for $200, please.  But let’s not start that again.  Here’s to boredom.

Until next time,

Cheers.

I’m still getting used to the idea that upon the end of CAAMP’s 2013 Mortgage Forum, which officially opens this Sunday, November 24^th, it will mark the end of a six year journey for me.  My official duties as a board member, and as a member of the executive, officially ended at CAAMP’s most recent AGM.  As of the 27^th of November, someone else will be responsible to set the path and direction for future conferences.  Whoever the privilege is bestowed upon to lead the conference in the future will be comforted by the fact that they will work alongside the extraordinary staff at CAAMP.  Mike Ellenzweig and the rest of the company work tirelessly to put on THE premier event of the year in the mortgage broker industry.  No disrespect to all the other conferences, but it is what it is.  Every year, just before the ribbon cutting ceremony to officially open the conference, Michael says to me in his deep baritone voice, “Bo…it’s in God’s hands now”.  Who am I to argue with Michael that God takes time away from his busy schedule to oversee the Mortgage Forum?  I will miss Michael’s dry sense of humour.

I am also going to miss the regular interaction with all the CAAMP staff, especially Samir Asusa and Jim Murphy.  Samir very quietly goes about his business.  For the uninitiated, a CFO’S role may not appear to be glamorous.  Number crunching, contract review may not be what one would consider sexy, but if it’s isn’t done properly an organization can get into a whole heap of trouble.  Samir, in large part, has ensured that CAAMP’s financial footing is very solid, and he’s treated every dollar collected with the respect is so deserves.  As for Jim Murphy, CAAMP’s President, a hardy thank you on behalf of the entire industry.  Jim’s steady hand, and political insight, will ensure that CAAMP will be able to navigate both chartered and unchartered waters in the future.  Jim made my job so much easier, and for that I am very grateful.  To Cara, Alison, Jeannie and Rocca, thanks for prepping me.  And lastly, to my friend Hali Strandlund, who called me and convinced me to run for a second term so I could sit on her executive team, thanks for making that call.

Six years is a lot of time to invest or more accurately volunteer.  My thinking is that if you’re going to invest that amount of time, then DO something.  I bristle, that’s code for my inside voice saying. OH..SHUT…UP, when people talk about their own legacy.  Others will determine the legacy, not some egomaniac.  But I don’t think there’s anything wrong with taking stalk of what you’re most proud of.  For me it was a few things, some visible and some not so much.  Six years ago I started to campaign that we should change a couple of our by-laws.  The first change, limiting the number of board seats that any one brand could occupy.  I believed this could pose a huge risk to our association.  In theory, one brand could occupy every board seat, thus ensuring that every executive position was made up of board members representing one brand.  If that ever came to pass our membership numbers would contract, quickly.  Thankfully the board, and the executive, agreed to deal with matter before it ever became an issue.  The second by-law change that I am proud of is term limits.  Today, the by-law states that a board member can only sit on the board for six years.  For CAAMP to flourish, fresh blood, a new way of thinking and passion is required.  My belief was that time served beyond six years would mean that the board member has gone beyond his/her expiration date.  Everyone has a shelf-life, and I believed it was in the association’s best interest to avoid the “is it time you to step aside” debate.  The approval and passing of a term limit by-law ensured that the association ecosystem would continue.

In the visible category?  I am so proud of our efforts in the political arena.  CAAMP took a leadership role in lobbying the government and regulators.  We stated clearly to the industry that was going to be our mandate going forward.  Today, our opinion matters, and our research is sought out by the Ministry of Finance, and regulators.  As long as CAAMP continues to make a commitment in this regard, our voice will grow stronger.  We may not win or get everything we want, but then again who does?  At the very least now we cans say we have a seat at the adult table.  Another one for the visible category, I’m proud of the transformation we made to the National Conference; from re-branding it to CAAMP Mortgage Forum, to partnering with the “Art Of”, ensuring a line-up of speakers that couldn’t even be imagined in the past.  We now dedicate one day of speakers to our industry, and the second day to macro issues, which ultimately impacts all of us.

It’s been a hell of a ride, but now it’s time for people a lot smarter than me to take the reins.  To all the board members I had the privilege of serving with, especially Hali Strandlund, Joe Pinheiro and Daryl Harris, thank you.  To all the members of CAAMP, I’ll sum up my six years on the board in two words…”I tried”.

Enjoy CAAMP Mortgage Forum 2013.

Until next time,

Cheers.

The mortgage industry adapted to a form of virtual currency long ago, before we knew what virtual currency was.

I came across an interesting article in the Globe this week about virtual cash, and the possibility that it may get some traction.  The opening sentence in the article was an eye grabber, “Imagine a day when virtual cash gives central banks a run for their money – literally“.  The digital revolution that we’re witnessing, and experiencing first hand, has changed our lives significantly.  The most profound effect is that very impossible seems possible today.  For example, I’m not shocked or surprised that the gatekeepers of all things monetary are worried about competition.

The Bank of Canada just released a paper saying that central banks are unlikely to stand aside and let the new industrialists such as Amazon and Facebook cut into their action.  I’m not going to pretend to understand the nuances and business models of companies such as Bitcoin, a software company who’s niche is virtual currency, but clearly they’ve grabbed the attention of the Bank of Canada, given the fact that they’ve responded by releasing the paper.  The central banks position that is that virtual currency will never become fully convertible into real cash, thus limiting virtual currency to just the internet.  Hm… anyone want to bet against Amazon or Facebook figuring out a way to make it work? 

There isn’t a day that goes that by that I don’t read something about our changing world or economy, and immediately wonder how can this make us obsolete?  Is the thought of virtual currency a threat to our industry?  Don’t think so. Why? Because the mortgage industry is miles ahead in this regard.  A broker, a lender, a lawyer and the borrower never see the product we provide as an industry.  It’s not as if I show up at a brokers office with a wheelbarrow full of cash, our average balance at Merix Financial is just north of $280k, and dump it on the broker’s desk and say, “here you go”. Then the broker wheels it over to the lawyer’s office, and he in turn takes it to the lawyer for the other side, and so on and so forth.  Magically someone along the line gets to actually keep some of the cash, but we never know how the final balance works out.  What an interesting concept.  We sell something you can’t see, and can’t touch.  Can you imagine if we did?  Imagine the cash in the wheelbarrow scenario, after I dump the cash on the brokers desk I say, “I’d like you to count it, and sign off stating all the information you provided is correct”.  And if the borrower happens to be there, we say “take a good look at this pile; this is what you owe me, plus more”.   Thankfully we don’t do business this way, for if we did we would all be curled up in the fetal position, sucking our thumbs, paralyzed with fear.

Virtual currency doesn’t pose a threat to us.  Could it change how we do things?  Possibly, but we long ago adapted to a form of virtual currency, even when we didn’t know what virtual currency was.  If virtual currency becomes the norm it will elicit a collective industry yawn.  Now, what won’t surprise me is if one day we pull out a twenty dollar bill and on the back of the bill is a picture of Mark Zuckerberg.

Until next time,

Cheers.

And in the case of  Toronto’s Mayor, Rob Ford, we’re talking major inferno. I had no intention in commenting on the allegations, and now admission that has dogged the Mayor, and captured the imagination of the local populace and comedians worldwide.  The question of “did he or did he not” rendered every other issue irrelevant.  Now we all know.

Full disclosure, I supported Rob Ford, and encouraged family and friends to do the same.  Finally, there was a candidate I could support for policy reasons rather than packaging.  Let’s face it, central casting would never send a Rob Ford look alike to a movie set to play a mayor in a movie, Toronto voters learned a valuable lesson on voting for packaging rather than results (see Toronto’s previous mayor).  So, finally there was a candidate that spoke to the silent majority and who appeared not to be a part of the establishment and intelligentsia.  It worked; Ford got elected by a rather large margin. But his actions today amount to flipping the bird to all his supporters, including me.

From first day of the Ford administration, certain media outlets were determined to bring down the mayor.  Some of the media coverage was repugnant, they spoke in code.  They didn’t believe he looked the part, and they were vicious in their criticism.  But at the end of the day that wasn’t the reason for Fords eventual demise.  Was it because he FINALLY admitted to smoking crack? Don’t think so, and I’m basing that on the media coverage of other well know political drug users. Not much has been written about President Obama’s admission that he used cocaine while in college.  I guess the media gets a pass on that one because Obama’s cocaine use was in the past and not while in office.  Okay, what about the present?  What about Liberal Leader, Justin Trudeau, who admitted to sparking up and enjoying the odd joint while sitting as a member of parliament?  Where was the moral indignation from the press?  I don’t believe that Canada has legalized marijuana, yet. The press’s hypocrisy aside, Rob Ford’s eventual demise is not because of drug use; but the fact that he lied about it.

There are lessons to be learned by the Ford fiasco, like what not to do in a crisis. Ford’s struggle for political survival today can be traced to hubris.  If an individual or a business, believes they’re above the rules and arrogant enough to believe they’re immune from fallout,  might as well start writing their professional obituary.  When Ford stopped listening to his handlers and their recommendations, it was the beginning of the end.  When your inner circle jumps ship because you’re on a path of ruin, and you’re still adamant about doing it your way only, the inevitable results will follow.  In politics and business there’s a play book to follow in times of crisis. In politics when you get caught with your pants down, or in Fords case a crack pipe in his mouth, you follow the tried and true methods.  He holds a press conference, uses his family as props in the in the background, looks straight into the camera and admits he lied, and promises to get help. If he can muster up tears that really works well.  He comes back in sixty days and it’s all behind him, But if you lie about it for months, daring the police to release the video, and you only come clean because you realize there is no out, it’s too late.

My heart goes out to Ford’s family.  They’re the innocent victims in all of this, and I struggle to rationalize why politicians do this to their families. But we’ve seen it before, and we’ll see it again.  Here’s something to ponder, the guy who smoked crack and was inebriated many times while on the clock, brought fiscal responsibility to City Hall, eliminated wasteful spending and ensured there was a budget surplus.  His predecessor other hand had the right look and pedigree, nearly drove Toronto into bankruptcy.  Go figure.

Until next time,

Cheers.