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was “not a positive one.” He noted that the International Monetary Fund has scaled back global growth forecasts for the year to 3.3 per cent, Europe is in recession, America is seized by political gridlock and even emerging markets are not booming as they once were. China reported its weakest growth rate in three years earlier in the day at 7.4 per cent for the third quarter. “So far, we're still on track and we expected moderate growth… (but) we're watching close,” he said. “We may have to revise downward somewhat, but so far we're in the same ballpark as we

A New Housing Boom in the US? The long-battered US housing market is finally starting to get back on its feet. But some experts believe it could soon become another housing boom. Signs of recovery have been evident in the recent pick ups in home prices, home sales and construction. Foreclosures are also down and the Federal Reserve has acted to push mortgage rates near record lows. But while many economists believe this emerging housing recovery will produce only slow and modest improvement in home prices, construction and jobs, others believe the rebound will be much stronger. Barclays Capital put out

a report recently forecasting that home prices, which fell by more than a third after the housing bubble burst in 2007, could be back to peak levels as soon as 2015. Construction is expected to be even stronger, with numerous experts forecasting home construction to grow by at least 20% a year for each of the next two years. Some believe building could be back near the pre-bubble average of about 1.5 million new homes a year by 2016, about double the 750,000 homes expected this year. “We think the recovery is for real this time around," said Rick Palacios, senior analyst with John Burns Real Estate Consulting

Carney says he will be clear about Interest Rate Hikes In a speech delivered in Nanaimo, B.C., Carney said he intends to ensure that Canadians know exactly what the bank is doing and why. "If we were to lean against emerging imbalances in household debt, we would clearly declare we are doing so and indicate how long we expect it would take for inflation to

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Canadian Economic Growth may be slower than expected, Flaherty says

The federal government may need to downgrade its growth projections for the Canadian economy when it releases its mid-year budget update, Finance Minister Jim Flaherty said Thursday. Flaherty said the mood at last week's meetings of finance ministers in Japan,

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return to the two per cent target," he said in notes released in Ottawa Earlier in the day, Statistics Canada revised its data on family finances showing that household market debt had risen to a record 163 per cent of disposable income, well above the 152 per cent previously reported using a less focussed measure.

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anticipated in the federal budget.” “In the medium to long term, public finances in several provinces are unsustainable, raising the spectre of debt crises, damaged credit ratings, and federal bailouts if corrective steps are not taken,” the report warns. “If such crises occur, they will harm not only the provinces directly concerned, but could affect the entire economy.” The alarm about Ontario was expected given that province's $15billion deficit, but the analysis by San Francisco credit expert Marc Joffe that oil-rich Alberta has the “highest default probability” 30 years into >>Cont. Pg.2

Free Market Evaluation The 7 Deadly Financial Mistakes

3

Strong Average Price Growth in September Toronto and Global Market Review

5

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Good Samaritan gives CPR to Canadian tourist suffering heart attack in midtown

HOME SALES FALL 15% IN A YEAR Despite a slight recovery over August, home sales fell 15.1 per cent across the country in September compared to a year earlier, according to figures from the Canadian Real Estate Association released Monday. Sales were down considerably more — 23.2 and 33.2 per cent respectively — in Toronto and Vancouver. While prices were up 8.2 per cent in Toronto year-over-year, compared to a 3.8 per cent decline in Vancouver, condo prices are already starting to soften here and many housing watchers expect house prices could follow in the new year CREA has cited tough new mortgage rules imposed by Ottawa for much of the slowdown in sales, saying that the fourth round tighter regulations which took effect July 9, reducing maximum

amortization from 30 to 25 years, knocked a lot of first-time buyers out of the market. While some first time home buyers may no longer qualify for mortgage financing under the new rules, it is likely that many others are stepping back and reassessing how much house they can realistically afford, which is one of the things new mortgage rules were designed to do.

Canada's inflation stays at 1.2% in September Inflation pressures in Canada continued to ease in September, setting the conditions for what economists believe will be a lengthy period of low interest rates. Statistics Canada reported Friday that last month's inflation rate stayed at 1.2 per cent— matching a two-year low also achieved in August and May of this year. David Watt, chief economist at HSBC Bank Canada, said he expects

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22 OCTOBER 2012

DREAMS MONEY &

THE 7 DEADLY FINANCIAL MISTAKES Who among us has not made a costly financial blunder? Come on; admit it -we all make some dumb moves for which we have to pay a pretty penny. Research by the Consumer Federation of America and Primerica found that two out of three Americans say they have made at least one "really bad decision," and almost half of those questioned (47 percent) acknowledged that they had made more than one financial bad decision. The median cost of these bad decisions was $5,000, but the average cost was $23,000. Here are the seven financial mistakes to watch out for. 1) Failing to maintain an adequate emergency reserve fund. 2) Creating an overly optimistic financial plan 3) Paying more fees than necessary. (Those who stick to nocommission index mutual funds start

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each year with a 1-2 percent advantage over those who invest in actively managed funds that carry a sales charge) 4) Allowing your emotions to rule your financial choices. 5) Not having adequate insurance/purchasing too much insurance.

TIP 1! It is important to take the time to do research for all of the companies with whom you could potentially open a policy. Choosing the first company listed in the phone book could lead to poor coverage and over payment for your policy. So choose an insurance broker, who deals with many companies. TIP 2! If there are people in your life who rely on you financially, it is important for you to consider buying a life insurance plan. Upon your passing, the payout from a life insurance plan makes it less stressful for your loved ones to come up with money to cover things like funeral expenses or college tuition. TIP 3! Question yourself about your personal reasons to purchase life insurance prior to signing any papers. Perhaps someone advised you to get one without knowing more about your situation. TIP 4! When you decide to buy life insurance, it’s important to calculate the amount you need carefully. The best person to make that decision for you is you. TIP 5! You want to make sure that you aren’t overbuying when it comes to life insurance, you want to buy within your needs. You should investigate insurance policies that address your individual

6) Assuming too big a risk. (If you are going to make a risky investment, limit your exposure to a reasonable percentage (single digits!) of your net worth) 7) Not asking for help. (Source :MoneyWatch)

Canadian economic growth... From Pg.1 the future was a shocker. Alberta currently has the highest bond rating and no net debt. Over the 30-year horizon, the report said all provinces have high probabilities of default unless measures are taken. But he said provinces have plenty of time to act because at present all

provincial debt burdens remain well below 25 per cent of annual tax revenues. “It's very important for Canada that not only the federal government but the provinces are on that same deficit reduction and public debt reduction track.” Flaherty said he believes provincial finance ministers are committed to bringing down their deficits and debt.

Canada's inflation stays ... From Pg.1 this week. This would signal to markets that interest rates will likely remain stimulative for an extended period. The only fly in the ointment to that

scenario was a revision by Statistics Canada earlier this week that found household debt at 163 per cent of income, about where they were in the U.S. before the housing crash of 2007. As well, while the Canadian economy is slowing, there are tentative signs the U.S. recovery is firming.

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needs and those of your family, make sure you avoid buying more coverage than what you need. TIP 6! The better known insurance companies aren’t always the ones with the best deals. These can be the product of expensive marketing campaigns TIP 7! Purchase a two-in-one policy if you’re a married person. Instead of two separate polices, it is a joint one. TIP 8! Many people are unaware that any life insurance proceeds your insurance company pays are not taxable. This is especially important in the case of large policies. TIP 9! You may be able to pay less for life insurance when you buy more than a minimal amount. Sometimes your life insurance premium may be lower if you purchase more coverage. TIP 10! Compare companies and prices when you are shopping for life insurance. Don’t hesitate to reevaluate the insurance that you already have, and change or add to this policy. TIP 11! Perhaps you are thinking about exercising before going to a medical check up to seem healthier. However, this will probably make your blood pressure rise, giving the doctor a false reading.

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HOUSING MARKET DEBT

DREAMS MONEY &

Strong Average Price Growth in September

Editor-in-Chief & Publisher Perrii Muthuraman Direct : 416 473 6100

Greater Toronto Area (GTA) REALTORS® reported 5,879 transactions through the Toronto MLS system in September 2012. The average selling price for these transactions was $503,662, representing an increase of more than 8.5 percent compared to last year. The number of transactions was down by 21 per cent in comparison to September 2011. “While sales have been lower due to stricter mortgage lending guidelines, we continue to see substantial competition between buyers. The months of inventory trend remains low from a historic perspective, which explains the strong price increases we are experiencing,” said Toronto Real Estate Board (TREB) President Ann Hannah.

Editor & Technical Advisor Aishwar Muthuraman 105-2100 Ellesmere Road, Scarborough, ON, M1H 3B7 Ph: 647 352 4945 | Fax: 647 352 6110 Email: info@dreamsandmoney.com www.dreamsandmoney.com DISCLAIMER Dreams and Money takes care to present all the information as accurately and efficiently as possible. Any advice or recommendation appearing in the paper is also part of information only. They should not be construed as an expert opinion. Please note that no representation or warranty with respect to the accuracy or the completeness of the information is given. Information always keeps changing. Hence all the information, including advice and recommendations are to be treated as of general nature only. For your specific circumstances, you are always advised to consult an expert before acting on any information.

unsolicited articles & community news are welcome selected ones will be published email : editor@dreamsandmoney.com Copyright © 2010 Dreams and Money, Canada. All Rights Reserved.

Canada Sales Activity: Historical and Forecast

THE MISSION At Dreams & Money, we want to help people lead happy lives. We want to help people reach their dreams. A lot of dreams in the world require financial awareness and proper planning to bring to fruition. To get this financial knowledge can be challenging. We realize this, and want to make this process simpler. We will bring you financial news happening around you that impacts you, along with timeless classics on topics like financial planning, life skills, health etc. to help you grow all around to reach your dreams. If you are someone who shares this same passion, and think you can contribute to us in any way (writing articles, spreading the message etc.), please let us know. We’ll be happy to hear from you.

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22 OCTOBER 2012

INVESTING

DREAMS MONEY &

Global and Indian Market Weekly Review - Week Ended 19 October 2012 Monday European and Asian shares rose as China's exports grew more than estimated in September 2012. US stocks climbed after earnings from Citi group Inc, the third-largest US bank, and retail sales strongly beat expectations. Tuesday European stocks edged higher after reports suggested that Spain is moving closer to making a formal bailout request. Asian and the US stocks edged higher after some surprisingly strong US data and earnings. Wednesday European shares rose for the third consecutive session after a decision by ratings agency Moody's to retain Spain's investment grade credit rating. Asian stocks also edged higher. US stocks rose on Wednesday after the latest data indicated that the US housing market continues to improve Thursday European and Asian shares edged higher in choppy trade as growth data from China sent resource stocks higher. US stocks edged lower on Thursday, after Google Inc.'s weakerthan-expected results pushed the technology sector into the red. Friday European and most Asian stocks edged lower on as investors eyed the second day of a two-day European summit, while weak US tech earnings overnight weighed on sentiment. Greek Prime Minister Antonis Samaras told a Greek newspaper on Sunday adding that the country is facing its "final hurdle." China's exports grew more than estimated in September 2012. September's 9.9% yearon-year growth in exports also produced a $27.7 billion monthly trade surplus. Chinese consumer prices rose 1.9% year in September, in line with

economist expectations. The producer price index fell 3.6% in September from the same month a year ago, after a 3.5% on-year decline in August. China's economic growth slowed for a seventh quarter while showing signs of a pickup last month, reducing the urgency to add stimulus and offering support for a global expansion buffeted by Europe's debt turmoil. Gross domestic product expanded 7.4% in the third quarter from a year earlier, the National Bureau of Statistics said in Beijing today. That reading fell below second-quarter growth of 7.6% and was also slower than the Chinese government's official 2012 growth target of 7.5%. China's industrial production increased 9.2% in September from a year earlier, rebounding from a three-year low of 8.9% expansion in August. Retail sales rose 14.2% in September from a year earlier, up from 13.2% growth in August. Fixed-asset investment in urban areas, a measure of construction activity, was up 20.5% in January-September from a year earlier, accelerating from a 20.2% rise in the first eight months of the year. China's Ministry of Commerce sounded a note of caution on the nation's export sector, saying there's no conclusive sign of a recovery in place, while data on foreign direct investment inflows showed an ongoing decline in September. Commerce Ministry spokesman ShenDanyang told reporters that the trade situation was "steadily progressing," but stopped short of calling a recovery, according to media reports. The doubt contrasts with upbeat trade statistics released last week that showed September's exports jumped 9.9% from a year earlier. The growth was higher than market expectations.

M.Shekar

China's foreign direct investment (FDI) dropped in September, rounding out a down-trending pattern for the first nine months of the year. Inflows of FDI totaled $8.43 billion for the month, down 6.8% from a year earlier, while January through September inflows totaled $83.4 billion, down 3.8% from the same period a year earlier US Commerce Department data showed retail sales advanced 1.1% last month. Federal Reserve Chairman Ben Bernanke has rejected arguments that bold moves to bolster US job growth could have unwanted consequences in emerging market countries. In a speech delivered on Sunday in Tokyo was at a conference sponsored by the Bank of Japan and the International Monetary Fund Bernanke disagreed with criticism that the Fed's efforts to drive US interest rates lower could result in higher inflation in emerging markets or trigger a destabilizing flood of investment money into those nations. Optimism for the US economy increased as industrial production gained while home-builder confidence climbed to a six-year high. Industrial output rose 0.4% in September after a steep drop the prior month. Builder confidence in October edges higher to mark the sixth gain in a row, with only the Midwest reporting a decline in sentiment. German Chancellor Angela Merkel on Monday underlined her support for Greece to remain in the euro zone but said the country still had a lot of work ahead of it to restore confidence and stability. Merkel said European leaders

Raymond James Ltd. Launches Unique Comparative Study in Canadian versus US Real Estate Markets Toronto, Ontario – Raymond James Ltd., the Canadian arm of North American investment dealer Raymond James Financial Inc., announced the launch of a new research study that provides a unique comparison of the Canadian versus US real estate markets. “The publicly traded real estate

sector in Canada has performed well over the past year with the TSX/Capped REIT index delivering a 14.4% total return,” says Ken Avalos, Senior Real Estate Analyst in Canada. “This compares favourably with the US benchmark, the RMS, over the same period which posted a 16.6% total

were working to avert "uncontrolled developments in the eurozone" that could be touched off by a Greek exit from the 17-nation euro area and create "a state of shock" in the global economy. German investor confidence gained for a second month in October as the European Central Bank's plan to buy government bonds fueled speculation that the sovereign debt crisis can be contained. The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict economic developments six months in advance, climbed to minus 11.5 from minus 18.2 in September. Spain: Moody's Investors Service on Tuesday affirmed Spain's sovereign rating at Baa3, keeping it at investment grade for the time being. However, it assigned a negative outlook to the rating as a reminder that a downgrade into junk territory is likely if conditions deteriorate further. Spain auctioned 4.6 billion euros ($6.03 billion) of government bonds. The total exceeded the top end of the Treasury's target range at 4.5 billion euros as borrowing costs fell amid continued expectations the country will soon seek a full bailout, which would allow the European Central Bank to launch its bond-buying program. The auction produced a 10-year average yield of 5.46%, reports said, down from 5.67% in a September auction. A sale of four-year paper produced a yield of 3.98%, down from 4.60% last month, while an auction of three-year paper saw a yield of 3.23% versus 3.68%. Europe: Developments in Brussels, Belgium were in the spotlight for a second day, as European leaders prepared for the second day of talks at the >>Cont. Pg.5

Rally Takes a Break after Four Days TSX Trend From Oct.15, 2012 to Oct.20, 2012

return.” . “In some ways, the Canadian real estate market has considerable room to grow when comparing it to the US and this will be attractive to many investors no matter what side of the border they live on,” says Avalos. In the short term, Avalos expects the current low interest rate environment and improving commercial real estate fundamentals to benefit several Canadian real estate equities. Immediate and long term opportunities also exist as the real estate industry evolves in Canada in terms of capital structure, governance, and scope of activities at real estate companies. “While there are attractive growth opportunities ahead, the sector will likely not operate without some volatility in the year ahead,” says Avalos. “The uncertainties around the globe will continue to affect all sectors, but if investors can stomach this volatility in some real estate investments and look for quality, well managed firms to invest in, the long term gains for several Canadian real estate equities should be very attractive if they continue to mirror the US real estate experience.”

Source : Yahoo Finance

Canada's main stock index finished lower on Friday, breaking a four-day winning streak. Negative sentiment from quarterly U.S. corporate results spilled into Canadian stocks The S&P/TSX composite index fell 50.14 points to 12,415.98, while the TSX Venture Exchange added 3.28 points to 1,315.62. "A bit of this end-of-the-week sell-off is some disappointment around earnings from some companies within the S&P 500 and the Dow," said Craig Fehr, Canadian market strategist at Edward Jones in St. Louis, Missouri. Earnings are "really reflecting the pressure that corporate profits are under right now given the broader economic backdrop," he said. Commodity prices were lower. The Canadian dollar dropped to its lowest level since late August, down 0.85 of a cent to 100.68 cents US amid falling prices for oil and metals, particularly copper. Investors were also unimpressed with an agreement early Friday by the leaders of the 17 euro zone countries to push ahead with a single banking supervisory body. 4


TAKE CARE OF YOUR BODY

22 OCTOBER 2012

DREAMS MONEY &

STORY TIME

Good Samaritan gives CPR to Canadian Tourist suffering Heart Attack in Midtown The family of a Canadian tourist who suffered a heart attack in midtown want to say “thank you” the stranger who saved his life. Relatives of Jason Kroft, a Toronto lawyer, have put up fliers around 6th Ave. and 45th St. hoping the good Samaritan works in the area and will come forward. Kroft, 40, was visiting family in Manhattan on Oct. 5th when he clutched his chest and fell to his knees, his brother Ryan Kroft told ABC. The family called 911, but with no time to spare, a stranger emerged from the crowd. “The man appeared and asked a few questions and the next thing I knew he

was giving mouth-to-mouth,” Kroft said. As the ambulance arrived, Jason Kroft’s wife, two daughters and brother rushed to see him into the ambulance. The life-saving stranger had already disappeared into the crowd. The family has only been able to identify the man as red-haired, in his 40's, and wearing a blue jacket and dress pants. Kroft was recovering after openheart surgery at St. Luke’s Hospital. “We would definitely like to find the guy and thank him, but if he doesn't want to be identified, we don't want to force him,” Ryan Kroft said.

Global and Indian Market... From Pg.4 European Council's summit. The council wrapped up the first meeting Thursday night and said it has set a deadline of Jan. 1 to agree on a legislative framework for a single supervisory mechanism. The euro leaders further said Greece has made good progress with implementing much-needed austerity measures, which could pave the way for the next tranche of bailout money. An agreement is a condition to receive a 31 billion-euro aid installment the country needs to fund banks and pay debts. Greece has been locked in negotiations with a delegation of inspectors from the European Commission, the International Monetary Fund and the European Central Bank--known as the troika--since early September over a twoyear, 13.5 billion euro ($17.6 billion) austerity plan. The current rates set by the European Central Bank are appropriate given the low growth rates in the euro zone, ECB Governing Council member EwaldNowotny said on Friday, 19 October 2012. The policy maker also said that he sees no danger of inflation at the moment. UK jobless claims unexpectedly fell in September and a wider measure of unemployment dropped to the lowest in more than a year as the London Olympics helped push the number of people in work to a record. Jobless-benefit claims fell 4,000 from August to 1.57 million, the

Office for National Statistics said today in London. The jobless total measured by International Labor Organization methods declined to 7.9% between June and August. Employment surged 212,000 to 29.6 million, the highest since records began in 1971. UK retail sales rose more than economists forecast in September on increased demand for winter clothing and school uniforms. Sales including fuel gained 0.6% from August, when they fell 0.1% Britain posted its smallest September budget deficit since 2008, providing a boost for Chancellor of the Exchequer George Osborne as he struggles to meet his borrowing targets. The shortfall excluding government support for banks narrowed to 12.8 billion pounds ($20.5 billion) from 13.5 billion pounds a year earlier, the Office for National Statistics said in London today. India Indian markets ends on a flat note on mixed cues during the last week. Global cues were encouraging as euro zone debt worries eased after Moody's Investors Service on Tuesday retained Spain's sovereign-debt rating at investment grade. However, political worries in India kept the market on the edge as the Opposition parties stepped up pressure on the government for an independent inquiry into the land deal between Congress chief Sonia Gandhi's son-in-law Robert Vadra and realty major DLF. Market gained in three out of five trading sessions. Sensex up by 0.04% to 18682.31 and Nifty up by 0.14% to 5684.25 for the week ended 19

(Source : www.nydailynews.com)

October 2012 The focus of the stock market is currently on the second quarter earnings. Investors and analysts will closely watch the management commentary that would accompany the results which could cause revision in their future earnings forecast of the company for the current year or the next year. Investors will watch developments on the taxation front. Finance Minister P. Chidambaram had said on 1 October 2012 that the government will set final rules on tax avoidance within 20 days after considering recommendations made by a government panel. The panel was set up by Prime Minister Dr. Manmohan Singh to examine controversial laws known as general anti-avoidance rules (GAAR), first proposed in the budget in March, that target firms and investors routing money through tax havens. The committee in an earlier report submitted to the government last month had suggested deferring the implementation of GAAR by three years. The committee had also recommended that the government should abolish the tax on gains arising from transfer of listed securities, whether in the nature of capital gains or business income, to both residents as well as non-residents. The committee had said that the government might consider increasing the rate of Securities Transaction Tax (STT) appropriately to make the proposal tax neutral. At present, short-term capital gains on equities are taxable at the rate of 15%. Holding period of less than one year is considered as short term. There is no long term capital gains tax on sale of

Funny Signs!!!

5

shares. Business income is taxed at 30%. Distinguishing capital gains and business income depends on several factors, and disagreements have resulted in numerous litigation cases between the Revenue Department and taxpayers, the committee had said last month. The high WPI inflation reading for September 2012 will keep pressure on the central bank to refrain from lowering interest rates despite a sharp slowdown in economic growth. India is gaining importance in the field of investment day by day. There are so many factors that favor the investment in India and attract the potential investors from all over the world. The small scale sector is also very good for investment planning in India. The infrastructure of the country also supports the investment planning in India. All these things together create a very healthy atmosphere for investment in India. The investment sector of India has emerged as a great wealth creator. In fact it has been termed as the world's fastest growing creator of wealth. The government of India also frames such rules and regulations so as to attract investors from all over the world to invest in India. You can make money by investing in India with a good financial plan. We provide advisory services to frame a good financial plan, which able to manage your debts as well as save money and create wealth. We also provide practical training to make you independent investor. Further details: shekarm@indiafinancebazaar.com www.indiafinancebazaar.com |www.ifmaonline.com Ph : +91 9380034431/9962534431


Dreams & Money: 4th Issue of October 2012