As IF Times

link Markets Start to Anticipate Obama Victory in November – Fast Money – CNBC – CNBC.

This is a classic “as if” scenario.  Despite demonstrable incompetence and ill founded principles offered during the incumbent’s stay in the White House, the narrative is being pushed that the ‘stability’ offered by the Obama reign is somehow benign for the financial markets.  Only those who are still subscribing to the tooth fairy fantasy; those that are on their 3rd hit of the bong or those from California could possibly subscribe to this delusion.

The fact is, markets are anticipators of events, usually 6 to 8 months into the future.  For example, when the stock market suffered the massive swoon in early 2008, it was partly in anticipation of the Democratic victory in the fall of that year.  While the write downs in bank and mortgage valuations did substantiate the big selloff, it was the anticipation of a incoming regime that was expected to be unfriendly to markets that started the cascade.

At the moment, the Republicans are almost finished with their circular firing squad process of vetting their candidate to oppose Obama during this year’s November elections.  It appears that the presumptive victor, Mitt Romney will prevail and consequently, an experienced and capable economic individual will resume control of the Presidency.  It is more likely that this assumption is the scenario causing  the markets to advance.  To subscribe to CNBC’s version of reality is to assume that people have come to accept and embrace out of control spending, skyrocketing deficits and a sure but steady neutering of America’s economic and social system.  In other words, they assume that people have thrown up their hands and accepted that the U.S. will become Greece, Portugal or even worse, California.

While of course people will always adjust to whatever reality is thrust upon them, it’s a stretch for anyone to claim that the financial markets are stabilizing ahead of an Obama victory.  It’s as if someone chose to go back to eat at a particular restaurant after becoming violently ill when they last ate there.  It’s the logic of  ‘the devil you know’.  Sounds like spousal abuse to me.

link Young families pull up stakes for better life.

While at first, articles such as this will provoke lots of knee jerk responses from those who will say “something must be done”, the reality is that in a free society, that would make little sense.  The constant promotion of Vancouver over the past decade or so though the staging of  world class events such as the Olympics has resulted in the benefits we see today.  Vancouver is a world class destination no longer undiscovered by those that have means.  We kept telling people what a wonderful place it was and whaddya know, it’s worked!  Go figure that people would find the stunning scenery, benign climate and amiable population attractive.  Attractive enough to lure people to buy homes here.

As residents are always proud of proclaiming,  Vancouver is a world class city.  That’s the upside.  But now comes the unintended consequences. The downside is that locals may not be able to afford to live in a world class city.  Unless you were fortunate enough to have owned property here from 20 years ago, it’s unlikely that owning a house within the city proper is affordable for most people.  That’s the way  it is.  It’s not likely that in New York City, or Hong Kong, or Honolulu or San Francisco,  young families would be able to get a 2000 sq ft house with a small yard for the dog and kids for $300,000.  In all of those cases, as is in Vancouver, they are victims of their own success.

If it’s that wonderful, guess what, people will pay to be there.  The wave of enthusiastic property purchases have made innumerate locals wealthy beyond their wildest dreams for simply having the good fortune to have owned property.  Some of that money goes back into the local economy through lifestyles and undoubtedly some will get passed on to the children of those fortunate homeowners.  Because of this wealth effect, people don’t blink when paying $4 dollars for a half calf, double mocha with a latte twist at the hundreds of coffee shops in this town.  They don’t hesitate to pay $200 to watch the Canucks play hockey at a stadium where they pay $30 to park and $12 for a beer.  And my favorite, $120 bucks to buy Lululemon yoga pants.  While of course it’s a burden for young families, it does require an evaluation and assessment of expectations.

The fact that we are seeing young people move to more affordable communities is the natural order of things. (If that weren’t the case, everyone would still be huddled around Plymouth Rock in Virginia).  These people  will then build communities and create opportunities in places more affordable. Eventually, they’ll sponsor a hockey team and pay high ticket prices there too.

What should not be encouraged is the ugly populist notion of entitlement.  As it should now be obvious to most sane people, the blanket mentality of entitlement  threatens to smother progress everywhere.  Living in a comfortable society allows us the luxury of heightened expectations for all aspects of our daily lives, but expectations are not rights.   The next time you hear about someone complaining about how high property prices are, ask them if they’d be willing to sell theirs for what they paid for it.  After the laughter dies down, the only sound you’ll hear are crickets.