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#8054544 - 01/21/15 09:20 AM Bank of Canada cuts rate by 1/4%
TheRealCSnapper Moderator Offline
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to shield canadians from the economic downturn as we're hit with low oil prices...

oy vey

so what does all the arm chair economist on here have to say about this?

http://www.theglobeandmail.com/report-on-business/economy/bank-of-canada-rate-cut/article22548417/





The Bank of Canada announced a surprise quarter percentagepoint cut to its key interest rate Wednesday – a move it calls “insurance” against the potentially destructive effects of the oil price collapse.

The reduction in the bank’s overnight rate to 0.75 per cent from 1 per cent – its first move since September, 2010 – comes as a precipitous drop in the price of crude slams Canada’s oil-dependent economy.

The oil shock will be “negative for growth and underlying inflation in Canada,” the bank warned in a statement.

Bank of Canada Governor Stephen Poloz is expected to explain his dramatic decision at an 11.15 a.m. news conference in Ottawa Wednesday.

The rate move, which few analysts anticipated, is an attempt by Mr. Poloz to shield highly indebted Canadian households from an oil-induced hit to their jobs and incomes – signs of which are already evident in Alberta.

The rate cut is a signal to private-sector banks to lower their own rates on mortgages and other loans.

It’s also likely to accelerate a slide in the Canadian dollar, now at roughly 83 cents (U.S.).

Cheaper crude, while good for the U.S. and global economies, is unequivocally bad for Canada.

The bank warned that lower oil prices would take a sizeable bite out of economic growth in 2015, delay a return to full capacity and hurt business investment – a trend that has already triggered mass layoffs and production cuts in Alberta’s oil patch.

But the effects could spread further, threatening financial stability as a result of possible losses to jobs and incomes, according to the central bank.

“The oil price shock increases both downside risks to the inflation profile and financial stability risks,” the bank acknowledged. “The Bank’s policy action is intended to provide insurance against these risks.”

The bank’s new forecast assumes a price of “around” $60 per barrel for Brent crude, more $10 above where it is now. But the central bank said prices “over the medium term are likely to be higher” than $60.

As recently as June, oil was selling for $110 a barrel.

The bank also lowered its bank rate and the deposit rate by a quarter percentage point Wednesday, to 1 per cent and ½ per cent, respectively. And it removed any indication of which way rates might go next.

The bank’s decision coincides with a much more pessimistic economic forecast than the bank issued just three months ago.

Following the lead of most private-sector forecasters, the bank slashed its GDP growth forecast to 2.1 per cent this year (from 2.4 per cent), before rebounding to 2.4 per cent in 2016. The worst effects of the oil collapse will be felt in the first half of this year, when the bank expects annualized growth of 1.5 per cent, nearly a full percentage point lower than its October forecast.

The Canadian economy grew at an estimated rate of 2.4 per cent in 2014.

The bank said the economy won’t return to full capacity until the end of 2016, several months later than its previous estimate of the second half of next year. Among other things, the central bank pointed to significant “labour market slack.”

Crude’s effects on the economy will be broad and profound, the bank warned. Investment in the oil and gas sector will decline by as much as 30 per cent this year, while lower returns on energy exports will eat into Canadian incomes, wealth and household spending.

The bank also hinted at a possible spread to other parts of the country of a real estate slump already underway in Alberta. “The extent to which the downturn already evident in Alberta will spill over into other regions remains to be seen,” the bank pointed out in its monetary policy report.

“The ramifications of the oil-price shock for household imbalances will depend importantly on the impact of the shock on income and employment,” the bank added.

The bank also expressed growing angst about the impact that oil could have on inflation, which it said has been propped up by temporary effects, such as the “pass-through” effect of the lower Canadian dollar.

Consumer price increases, now running at roughly 2 per cent a year, are “starting to reflect the fall in oil prices,” the bank said.

The bank’s new forecast calls for overall inflation to fall well below its 2-per-cent target this year, averaging just 0.6 per cent. Core inflation, which strips out volatile food and energy prices, is expected to average 1.9 per cent in 2015.

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#8054597 - 01/21/15 09:37 AM Re: Bank of Canada cuts rate by 1/4% [Re: TheRealCSnapper]
Screamin Type ARGH! Offline
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makes sense. if anything given what happend in 08-09, of course they're gonna play it 'safe'. but given our Gov, it wouldn't surprise me they have an underlying agenda.
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#8054631 - 01/21/15 09:53 AM Re: Bank of Canada cuts rate by 1/4% [Re: Screamin Type ARGH!]
Euphoricuck Offline
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Registered: 11/05/03
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Loc: Canadistan
dddddddddd..d.d.d.d.d.dd.eflation.

we are in for a world of hurt. fucking harper.
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#8054716 - 01/21/15 10:42 AM Re: Bank of Canada cuts rate by 1/4% [Re: Euphoricuck]
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 Originally Posted By: Euphoric

we are in for a world of hurt. fucking harper.






This spring real estate market will be retarded, here come the bidding wars again hope not, but pretty sure people will go full retard if mortgage rates come down.

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#8054725 - 01/21/15 10:45 AM Re: Bank of Canada cuts rate by 1/4% [Re: Risky Business]
Euphoricuck Offline
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Registered: 11/05/03
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did you read this shit?
http://www.theglobeandmail.com/globe-inv...rticle22496585/


Do you think our country is in good shape moving forward? snoopdogno.gif

http://www.theglobeandmail.com/globe-inv...rticle22549247/

Harper is scum class
_________________________

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#8054728 - 01/21/15 10:46 AM Re: Bank of Canada cuts rate by 1/4% [Re: Risky Business]
SuPeR-MaRiO Offline
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 Originally Posted By: Rinky Business
This spring real estate market will be retarded, here come the bidding wars again hope not, but pretty sure people will go full retard if mortgage rates come down.

This.

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#8054745 - 01/21/15 10:53 AM Re: Bank of Canada cuts rate by 1/4% [Re: SuPeR-MaRiO]
Euphoricuck Offline
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average prices are already down across toronto....so it will be interesting to see what happens.
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#8054761 - 01/21/15 11:05 AM Re: Bank of Canada cuts rate by 1/4% [Re: Euphoricuck]
JEFFOS Offline
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A home in oakville was in a bidding war and sold for 90k over asking last Monday. Ridiculous and its off season too.
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#8054769 - 01/21/15 11:12 AM Re: Bank of Canada cuts rate by 1/4% [Re: JEFFOS]
TheRealCSnapper Moderator Offline
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 Originally Posted By: JEFFOS
A home in oakville was in a bidding war and sold for 90k over asking last Monday. Ridiculous and its off season too.


from your posts and talking to you, you're in a very specific space so overall market trends don't apply

i'm sure even in the heat of a recession, your segment will still be getting fucked.

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#8054773 - 01/21/15 11:16 AM Re: Bank of Canada cuts rate by 1/4% [Re: TheRealCSnapper]
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Yay more of my principle is being paid off with every payment. Thanks BoC!
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#8054778 - 01/21/15 11:19 AM Re: Bank of Canada cuts rate by 1/4% [Re: LNXGUY]
Euphoricuck Offline
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Youre poorer than you think. -scotiabank
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#8054804 - 01/21/15 11:34 AM Re: Bank of Canada cuts rate by 1/4% [Re: Euphoricuck]
Hatorade Online   crying
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Yay, home prices here keep going up!!!
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I thought Spark was a robot from the old movie and I kind of remember seeing him telling some engineer showing the equation for a clear metal that the guy would event years later - porschetr

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#8054814 - 01/21/15 11:37 AM Re: Bank of Canada cuts rate by 1/4% [Re: Hatorade]
Senor Eduardo_82 Offline
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Meanwhile our dollar keeps tanking. I just paid $1.23 exchange for USD.


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#8054820 - 01/21/15 11:40 AM Re: Bank of Canada cuts rate by 1/4% [Re: Euphoricuck]
LNXGUY Moderator Offline
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 Originally Posted By: Euphoric
Youre poorer than you think. -scotiabank


_________________________
-Bill
The GN would OWN you, your children and your children's children.
'09 E90 335d

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#8054864 - 01/21/15 11:57 AM Re: Bank of Canada cuts rate by 1/4% [Re: Euphoricuck]
Risky Business Offline
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 Originally Posted By: Euphoric
did you read this shit?
http://www.theglobeandmail.com/globe-inv...rticle22496585/


Do you think our country is in good shape moving forward? snoopdogno.gif

http://www.theglobeandmail.com/globe-inv...rticle22549247/

Harper is scum class


Still don't see the connection to Harper.

 Originally Posted By: LNXGUY
 Originally Posted By: Euphoric
Youre poorer than you think. -scotiabank







 Originally Posted By: JEFFOS
A home in oakville was in a bidding war and sold for 90k over asking last Monday. Ridiculous and its off season too.


I guess i fail to understand why that surprises you. Desirable areas have always remained high, you are going against people with the your income level and then some not peasants. Leaside as an example was always expensive, during the recession it barely even moved, then you look at a place like Scarborough and it was a firesale


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#8055055 - 01/21/15 12:49 PM Re: Bank of Canada cuts rate by 1/4% [Re: Risky Business]
Euphoricuck Offline
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^it wasnt meant to point out a connection to Harper...it was just a ridiculous feature.




Harpers economic action plan = oil sands. ooops
I don't see this as making us more competitive or bringing back manufacturing jobs to Ontario. I see it as a political move for Harpers west.
Poloz is in harpers back pocket.



Anyone who voted for Harper should be embarrassed.
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#8055149 - 01/21/15 01:19 PM Re: Bank of Canada cuts rate by 1/4% [Re: Risky Business]
JEFFOS Offline
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Registered: 01/27/00
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 Originally Posted By: Rinky Business
 Originally Posted By: Euphoric
did you read this shit?
http://www.theglobeandmail.com/globe-inv...rticle22496585/


Do you think our country is in good shape moving forward? snoopdogno.gif

http://www.theglobeandmail.com/globe-inv...rticle22549247/

Harper is scum class


Still don't see the connection to Harper.

 Originally Posted By: LNXGUY
 Originally Posted By: Euphoric
Youre poorer than you think. -scotiabank







 Originally Posted By: JEFFOS
A home in oakville was in a bidding war and sold for 90k over asking last Monday. Ridiculous and its off season too.


I guess i fail to understand why that surprises you. Desirable areas have always remained high, you are going against people with the your income level and then some not peasants. Leaside as an example was always expensive, during the recession it barely even moved, then you look at a place like Scarborough and it was a firesale



Oakville and south Mississauga don't work like that normally - always going for near asking or at the worst 10k over.

90k is nuts (and was way overpriced) for that house.
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-Jeff

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#8055205 - 01/21/15 01:39 PM Re: Bank of Canada cuts rate by 1/4% [Re: Senor Eduardo_82]
iamfob Offline
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 Originally Posted By: eddie _82
Meanwhile our dollar keeps tanking. I just paid $1.23 exchange for USD.



Credit card purchase will be 1.26 \:\(
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FTMFW!!!

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#8055218 - 01/21/15 01:43 PM Re: Bank of Canada cuts rate by 1/4% [Re: JEFFOS]
Euphoricuck Offline
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It has to be this because there has been NOTHING else like it in the past week of stuff being posted.

Some sales were even as low as 80% of asking.

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#8055234 - 01/21/15 01:47 PM Re: Bank of Canada cuts rate by 1/4% [Re: Euphoricuck]
SuPeR-MaRiO Offline
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Registered: 06/28/01
Posts: 6111
Loc: Toronto, Ontario
^ that looks like childs play in comparison to East York. Nice home, decent price. Taxes are little high though.
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#8055243 - 01/21/15 01:50 PM Re: Bank of Canada cuts rate by 1/4% [Re: Euphoricuck]
spd-dmn Offline
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 Originally Posted By: Euphoric
average prices are already down across toronto....so it will be interesting to see what happens.


down compared to when?

everything ive seen in recent treb reports is still positive growth

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#8055246 - 01/21/15 01:51 PM Re: Bank of Canada cuts rate by 1/4% [Re: spd-dmn]
Euphoricuck Offline
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Down compared to this time last year. lol treb
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#8055254 - 01/21/15 01:52 PM Re: Bank of Canada cuts rate by 1/4% [Re: Euphoricuck]
spd-dmn Offline
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do you have an actual report or tracking of this?

or are you just saying it anecdotally based on mls (managed by treb....) sold listings

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#8055273 - 01/21/15 01:59 PM Re: Bank of Canada cuts rate by 1/4% [Re: spd-dmn]
Euphoricuck Offline
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 Code:
Detached 2014	  Sales	   VYA	  Average Price	         VYA	 	 	 
City of Toronto ("416")	   122	7.0%	$859,672	-4.2%	 	 	 
Rest of GTA ("905")	   487	14.6%	$621,872	-2.5%	 	 	 
GTA		           609  13.0%	$669,510	-3.4%	 	 	 
 	 	 



Despite the fact that treb makes up bullshit stats and changes past figures...the fact they even reported a dip in pricing is interesting...even if they attempt to sugar coat it.


http://www.century21.ca/donald.lum/Blog/Mid_Month_January_2015_Resale_Home_Sales
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#8055613 - 01/21/15 04:07 PM Re: Bank of Canada cuts rate by 1/4% [Re: Risky Business]
Lafora Offline
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Registered: 12/16/01
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 Originally Posted By: Rinky Business
 Originally Posted By: Euphoric

we are in for a world of hurt. fucking harper.






This spring real estate market will be retarded, here come the bidding wars again hope not, but pretty sure people will go full retard if mortgage rates come down.


you think it'll wait till the spring?

the bidding wars were retarded last year and the year before, and the year before

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#8055677 - 01/21/15 04:51 PM Re: Bank of Canada cuts rate by 1/4% [Re: Euphoricuck]
spd-dmn Offline
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Registered: 11/24/04
Posts: 2271
 Originally Posted By: Euphoric
 Code:
Detached 2014	  Sales	   VYA	  Average Price	         VYA	 	 	 
City of Toronto ("416")	   122	7.0%	$859,672	-4.2%	 	 	 
Rest of GTA ("905")	   487	14.6%	$621,872	-2.5%	 	 	 
GTA		           609  13.0%	$669,510	-3.4%	 	 	 
 	 	 



Despite the fact that treb makes up bullshit stats and changes past figures...the fact they even reported a dip in pricing is interesting...even if they attempt to sugar coat it.


http://www.century21.ca/donald.lum/Blog/Mid_Month_January_2015_Resale_Home_Sales



hmm interesting

youre right in the sense that its difficult to trust the numbers...

is that report based on C21's own sales?

i looked at the december HPI and year-over-year most of toronto was up 6-10% for single family detached


i think there will definitely be some more heat in the market very soon

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#8055728 - 01/21/15 05:35 PM Re: Bank of Canada cuts rate by 1/4% [Re: spd-dmn]
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Registered: 05/17/10
Posts: 44789
 Originally Posted By: spd-dmn
 Originally Posted By: Euphoric
 Code:
Detached 2014	  Sales	   VYA	  Average Price	         VYA	 	 	 
City of Toronto ("416")	   122	7.0%	$859,672	-4.2%	 	 	 
Rest of GTA ("905")	   487	14.6%	$621,872	-2.5%	 	 	 
GTA		           609  13.0%	$669,510	-3.4%	 	 	 
 	 	 



Despite the fact that treb makes up bullshit stats and changes past figures...the fact they even reported a dip in pricing is interesting...even if they attempt to sugar coat it.


http://www.century21.ca/donald.lum/Blog/Mid_Month_January_2015_Resale_Home_Sales



hmm interesting

youre right in the sense that its difficult to trust the numbers...

is that report based on C21's own sales?

i looked at the december HPI and year-over-year most of toronto was up 6-10% for single family detached


i think there will definitely be some more heat in the market very soon



Those C21 stats are straight from the TREB website. Keep in mind last January '14 we had one of the biggest YoY increase in average price from '13 to '14 it was ~16.5% price increase for detached...that was mostly due to a "shortage" of listings.

Listings now in the first two weeks of '15 seems to have normalized or are at least higher than last year (outlier year) so looks like it's just normalized, still a huge increase from '13 for example even if you factor in the minor decrease now.

If I had to guess, based on that alone and provided listings are slightly above last year, aka more normalized to trend then we shouldn't see any more price growth for detached. Then you have this interest rate decrease so who knows if people will go full retard or realize it doesn't mean they can spend an extra 100k.

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#8055762 - 01/21/15 06:00 PM Re: Bank of Canada cuts rate by 1/4% [Re: Risky Business]
spd-dmn Offline
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yeah def, that is a bad mindset to have.

this news hasnt changed my budget a bit. all it would be is just a nice "on top" to put into principal

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#8055767 - 01/21/15 06:02 PM Re: Bank of Canada cuts rate by 1/4% [Re: spd-dmn]
spd-dmn Offline
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Posts: 2271
on the other hand.. the one consideration this has changed is opting for variable rate.....

kind of wondering if it makes sense now, given that any rate increase would be even further now than orig planned

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#8055836 - 01/21/15 06:39 PM Re: Bank of Canada cuts rate by 1/4% [Re: spd-dmn]
Lafora Offline
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Posts: 4623
6 years ago when i was applying for a mortgage, from the stuff i've been reading on said 99% of the time you'll be better off with variable.

most variable will let you shift over to fixed anyhow.

Last mortgage was var; current one still var.

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#8056120 - 01/21/15 11:42 PM Re: Bank of Canada cuts rate by 1/4% [Re: Lafora]
ehko Offline
Quit being gay...
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You guys need to swing up to Barrie and join LNXGUY, Cee_Mon and I!
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#8056122 - 01/21/15 11:47 PM Re: Bank of Canada cuts rate by 1/4% [Re: ehko]
JEFFOS Offline
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 Originally Posted By: ehko
You guys need to swing up to Barrie and join LNXGUY, Cee_Mon and I!


http://youtu.be/8jPj5YOWEH0
_________________________
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#8056195 - 01/22/15 07:10 AM Re: Bank of Canada cuts rate by 1/4% [Re: ehko]
LNXGUY Moderator Offline
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Registered: 08/06/00
Posts: 106840
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 Originally Posted By: ehko
You guys need to swing up to Barrie and join LNXGUY, Cee_Mon and I!


It's fucking party time!
_________________________
-Bill
The GN would OWN you, your children and your children's children.
'09 E90 335d

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#8056293 - 01/22/15 09:00 AM Re: Bank of Canada cuts rate by 1/4% [Re: LNXGUY]
Euphoricuck Offline
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Barrie? Im in
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#8056338 - 01/22/15 09:28 AM Re: Bank of Canada cuts rate by 1/4% [Re: Euphoricuck]
LNXGUY Moderator Offline
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Registered: 08/06/00
Posts: 106840
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Bro, just bypass Barrie and head right up to Wasaga Beach \:\)
_________________________
-Bill
The GN would OWN you, your children and your children's children.
'09 E90 335d

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