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December 15, 2021 rate increases
December 14, 2021
7:02 pm
phrank
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It just got more interesting:

Rate* Update and Limited Time Offer Notice

Update 1: We're excited to share that effective Wednesday, December 15, some of our term deposit rates (both registered and non-registered) are increasing. We will also be offering a limited-time rate special, see below for details.

Our term rates (effective December 15) are as follows:

1-year term - 2.00% average - NEW

2-year term - 1.60%

3-year term - 1.95%

4-year term - 1.80%

5-year term - 3.00% (NEW LIMITED TIME OFFER - ACT NOW!)

The quarterly breakdown (effective December 15) of our 1-year term will be as follows:

The first three months: 1.85%

Months four to six: 1.95%

Months seven to nine: 2.05%

The last three months: 2.15%

Update 2: Lastly, we'd like to share that effective Wednesday, December 15, our registered high-interest savings rate for TFSAs, RRSPs, and RRIFs is increasing to 1.25%. The non-registered daily rate is also increasing to 1.25%

*All rates are subject to change

December 14, 2021
8:06 pm
Loonie
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I must admit I didn't think the five year rate would go to 3% this year, but it's snuck in under the wire, and great that it has!
MERRY CHRISTMAS
Who would ever have guessed this last January? Just shows you can't predict.

Inflation is an issue, but Norman1 and AltaRed assure us the current figures are some kind of aberration and will somehow vanish when all is said and done a number of months from now. I suspect they are wrong, but who knows? At least for the purpose of GIC ladders, I can't get too excited about shorter term inflation.

I sewed up my 2021 ladder purchases earlier but have some flexibility and might put in a little more at 3% to bump up the weighted average for the year. I'm OK with what I've done. The weighted average on the five year GICs I bought this year is higher than on the ones I redeemed sf-smile

It might be a good time to cash out an re-invest if you have a 1 year GIC with quarterly payments at Hubert when next interest payment comes due. The first quarter on a new one will pay 1.85, far more than what you have now.

December 15, 2021
6:44 am
savemoresaveoften
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Loonie said
I must admit I didn't think the five year rate would go to 3% this year, but it's snuck in under the wire, and great that it has!
MERRY CHRISTMAS
Who would ever have guessed this last January? Just shows you can't predict.

Inflation is an issue, but Norman1 and AltaRed assure us the current figures are some kind of aberration and will somehow vanish when all is said and done a number of months from now. I suspect they are wrong, but who knows? At least for the purpose of GIC ladders, I can't get too excited about shorter term inflation.

I sewed up my 2021 ladder purchases earlier but have some flexibility and might put in a little more at 3% to bump up the weighted average for the year. I'm OK with what I've done. The weighted average on the five year GICs I bought this year is higher than on the ones I redeemed sf-smile

It might be a good time to cash out an re-invest if you have a 1 year GIC with quarterly payments at Hubert when next interest payment comes due. The first quarter on a new one will pay 1.85, far more than what you have now.  

I wont commit to a 5y 3%, but the 1y 2% blended rate does look appealing. Whether BoC starts hiking or not next few months, the 1y rate is a sure win in my mind (compare to everywhere else) Have to take a look at Hubert now 🙂

December 15, 2021
7:22 am
jbntly
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2% For a 1 year cashable GIC is a very attractive offer!

December 15, 2021
7:27 am
canadian.100
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savemoresaveoften said
I wont commit to a 5y 3%, but the 1y 2% blended rate does look appealing. Whether BoC starts hiking or not next few months, the 1y rate is a sure win in my mind (compare to everywhere else) Have to take a look at Hubert now 🙂  

I agree - the 1 year 2% average starting @1.85% is very good. I also would not be so fast to lock up for 5 years @3% - there is a lot of pressure for the Fed and BoC to raise rates and rates may go up significantly in 2022 - central banks are late and should have been raising rates already with the current (and not transitory) inflationary pressures.

December 15, 2021
8:01 am
frizun
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New rate for 1 yr GIC is not updated on Website...CSR said it would happen tomorrow.

December 15, 2021
12:25 pm
Winnie
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New rate for 1 yr GIC is partially updated on Website:

https://www.happysavings.ca/products/terms/one-year-terms

December 15, 2021
12:56 pm
Dean
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jbntly said

2% For a 1 year cashable GIC is a very attractive offer!  

Until we remind ourselves that Inflation is getting close to 5% now. sf-cry

    Dean

P.S.
Welcome to the club, Jbntly ❗ sf-smile

sf-cool " Live Long And Prosper " sf-cool

December 15, 2021
3:59 pm
techno
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I tried to open a 1 year cashable GIC TFSA and the rate is still 1.5%. I tried the non-registered GIC and it's also 1.5%. Isn't it that the new rate starts today?

December 15, 2021
4:04 pm
BillieBob
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techno said
I tried to open a 1 year cashable GIC TFSA and the rate is still 1.5%. I tried the non-registered GIC and it's also 1.5%. Isn't it that the new rate starts today?  

An email I received from Hubert at 4pm EST:

Hello,

We realized this morning that our 12-month and 5-year rates did not update in our system as expected. This was our error and we apologize for the oversight.

Our 12-month rate (average 2.00%, see the monthly breakdown here) and our 5-year rate at 3.00%, are effective today and will be reflected in the banking system tomorrow.

If you purchased one of the above term deposits today, December 15, 2021, we will adjust the rates accordingly. If you purchase a term tomorrow, our correct rates will display!

Thank you for your understanding and for being a valued member of Hubert Financial. Happy holidays!

Sincerely,

Hubert

December 15, 2021
9:36 pm
techno
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Thanks BillieBob!

There's also something wrong with their website. When you try to buy GICs, it's not working smoothly.

December 16, 2021
5:06 am
mordko
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Inflation is an issue, but Norman1 and AltaRed assure us the current figures are some kind of aberration and will somehow vanish when all is said and done a number of months from now. I suspect they are wrong, but who knows? At least for the purpose of GIC ladders, I can't get too excited about shorter term inflation.

People are repeating what the Feds and the BOC have been saying even though both have been proven completely wrong.

If you remember, the “transitory/aberration” claim started with “oh, its just because we are comparing annual CPI numbers against the 2020 downturn”. The downturn was over by June 2020 so that particular claim was debunked by October 2021.

The Feds have since pivoted to “temporary supply chain problems”. Which is indeed a factor but its not clear just how “temporary” it is and there are other factors at play. Which have finally been acknowledged through central bank action if not in words. And that is why the direction of changes in rates savers get has changed.

December 16, 2021
9:49 am
jbntly
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Dean said

Until we remind ourselves that Inflation is getting close to 5% now. sf-cry

    Dean

P.S.
Welcome to the club, Jbntly ❗ sf-smile  

Thanks. As an asset class GICs have performed poorly over the last few decades so I agree they do not really compete well with inflation. However, for evaluating how good of a deal a particular GIC is, I prefer to compare against other available GICs and also to the rate set by the BOC which if low results in inexpensive credit. The 2% GIC is higher than the approximate 1.25% margin loan I have from interactive brokers and as the BOC may likely raise rates anywhere from 0.5 to 0.75 next year and more in years that follow I like that it is only a 1 year term. It's very useful to that it is cashable since I will have access to it of the stock market plummets. For me it is much more attractive than the 5 year GIC at 3%.

December 16, 2021
12:21 pm
Dean
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jbntly said

Thanks. As an asset class GICs have performed poorly over the last few decades so I agree they do not really compete well with inflation. However, for evaluating how good of a deal a particular GIC is, I prefer to compare against other available GICs and also to the rate set by the BOC which if low results in inexpensive credit. The 2% GIC is higher than the approximate 1.25% margin loan I have from interactive brokers and as the BOC may likely raise rates anywhere from 0.5 to 0.75 next year and more in years that follow I like that it is only a 1 year term. It's very useful to that it is cashable since I will have access to it of the stock market plummets. For me it is much more attractive than the 5 year GIC at 3%.  

Agreed ⬆ ... in these times, staying 'Short' (< 1yr.) makes a lot of sense. Tangerine's 5 month HISA @ 2%, and Hubert's 1 year cashable variable rate GIC @ 2%, are two good examples.

I too am now keeping a lot of Denaro accessible, in prep for the next time the stock market pukes itself again ... it's just a matter of time now ❗

'Fortuna Eruditis Favet'

    Dean

sf-cool " Live Long And Prosper " sf-cool

December 17, 2021
8:37 am
archangel
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It will be fascinating to see how the stock markets react if US democrazy [sic] is dissolved in 2022/24.

December 17, 2021
10:02 am
Norman1
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Loonie said

Inflation is an issue, but Norman1 and AltaRed assure us the current figures are some kind of aberration and will somehow vanish when all is said and done a number of months from now. I suspect they are wrong, but who knows? At least for the purpose of GIC ladders, I can't get too excited about shorter term inflation.

Those year-over-year CPI numbers have not been accurately showing what is really happening with prices. That's because of the arithmetic in the year-over-year calculation.

Same with that garbage posted about supposed pressure on US wages. The article referenced has a graph that clearly shows that average US wages have been stabilizing at just below where they were before the pandemic.

Is the restaurant sector such a big part of the economy that the central banks need to intervene when the restaurant staff are asking for higher wages? Where were the central banks around year 2000 when employers started paying $10,000 signing bonuses just to get IT workers to accept a job offer?

You and others seem to not understand both what the numbers actually mean and what AltaRed and I have been saying. We never said inflation would just disappear. Just that the year-to-year statistics are junk because of how irregularly prices have been moving around. That's quite obvious if one looks at the actual CPI prices instead of at just the title of the Statistics Canada press release.

December 17, 2021
11:32 am
AltaRed
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Loonie said
Inflation is an issue, but Norman1 and AltaRed assure us the current figures are some kind of aberration and will somehow vanish when all is said and done a number of months from now. I suspect they are wrong, but who knows? At least for the purpose of GIC ladders, I can't get too excited about shorter term inflation.
 

The math is the math based on the way the calculations are done. There would have to be some high YOY numbers since early/mid 2021 in order to get back on trend by Spring/Summer 2022.

Separate from that is the question of how much of current numbers is transitory, but neither of us have said it is ALL transitory. No one knows and I suspect there is more consensus than not that we are going to see some structural inflation, if for no other reason than productivity inefficiencies that will remain with us and new supply costs such as carbon taxes.

Productivity inefficiencies would include such things as idling of auto assembly plants due to supply shortages (labour and fixed costs continue regardless of whether an auto is assembled or not), inability to get shipping containers back to shippers on a timely basis, costs of covid vaccination that may be with us permanently, increased HVAC and sanitization costs due to covid, etc. There are a host of things that have decreased productivity and will likely continue indefinitely.

We are simply not going to know how much is transitory and how much is structural probably for several months yet. My guess though is monthly YOY CPI data points would fall back below 3% sometime in 2022 even with no intervention by BoC with interest rate increases. I do believe though some BoC increases are coming and should be coming to avoid being 'too wrong'.

Added: From an investor's perspective though, I agree with you that short term data points are not that relevant for a GIC ladder.

December 17, 2021
2:22 pm
Loonie
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I'm glad to hear you are now able to acknowledge structural inflation. Earlier, you were only willing to admit transitory. At the time I did not know the term for it.

You both seem to think I didn't hear you the first one, two, three, four, five, six etc times. I did. No need to repeat.

I understand math.

I am taking a much broader perspective than the math to which you refer, as I have said before. It includes some of the structural-related issues to which you now refer and more. There is reason in my mind to think it likely we will have significant inflation for a long time to come. These are not covered by your fairly simple mathematical calculations.

But perhaps we can all agree that we don't actually know specifically what is coming.

December 17, 2021
2:35 pm
BillieBob
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Not sure how it happened but Replies #12 through #18 should not be in this thread about Hubert's December 15 rate increase.

December 17, 2021
3:08 pm
pooreva
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BillieBob said
Not sure how it happened but Replies #12 through #18 should not be in this thread about Hubert's December 15 rate increase.  

Completely agree!

Guys, if you want to talk about inflation and other economy stuff, open your own topic. This is Hubert interest rate increase and I do not give a damn about inflation talk here.

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