COMMENTS:
Voted : Canadian dollar
For the first time in history I think.
Voted : Canadian dollar
Probably the Canadian dollar...they had caught up in value last week so by now they may have surpassed the American dollar by now...
...And it's still sinking...see ballot #118486 courtesy of our current "management team" in power..
Voted : Canadian dollar
That's one old dollar bill. They've been out of circulation for about twenty years now. We've been using the loonie (huard in French) which is a dollar coin with a loon on it. We also have a two-dollar coin with a polar bear on it, but we call it the twoonie, to rhyme with loonie.
I believe the Canadian dollar was worth more than the American one in the early 1970s.
On Friday, the Canadian dollar closed at $1.0345 US.
Voted : Canadian dollar
The Canadian Dollar has surpassed the U.S. Dollar. Not the first time though. There was a period in the 1970's where the Canadian Loonie was worth more than the U.S. Dollar.
The Bush administration has been accused by the IMF, the World Bank and the European Central Bank of intentionally forcing the dollar down, thereby causing a rise in value of other currencies. The result is that exports from those countries have been very hard hit.
The value of a currency is also not an indicator of the health of an economy. Some Currency traders have stated that the Bush administration adopted not so much a "Weak Dollar policy" as they did an abandonment of the dollar trading. By manipulating currecny trading, the Bush administration is accused of causing the unnatural upward valuation of foreign currency at the expense of those country's exports and foreign tourism.
If you follow the currency market, you probably know that the main reason China and Japan try to lower the value of their currency is because it drastically boosts their exports, while making imports less attractive. The net result is also increased domestic spending and a boon in tourism. FYI. :)
Also, it is not that other currencies have risen in value, as much as the dollar has declined in relative value to those currencies. In other words, comparing the value of the Sterling, the Canadian Loonie, etc., they have not increased in relative value to other currencies, as much as they have risen by default in trading with the U.S. dollar, more due to the intentional de-valuation of the U.S. dollar. And yes, there is a huge difference for the sole reason that the rise if value of those currencies is in effect, being manipulated by the fact that the U.S. administration has intentionally allowed the U.S. Dollar to decline.
From the Economic Times:
Shifting Production
Rainer Schmueckle, chief operating officer at Daimler’s Mercedes Car Group, said at a September 25 press conference that the Stuttgart, Germany-based company would have to consider shifting more of its production to the United States if the euro, currently at about $1.41, were to rise above $1.45 and remain there.
In Canada, whose dollar has risen to near-parity with the US currency for the first time in 31 years, the biggest software maker, Cognos, is holding the line on prices even as the exchange rate eats away at its profits. Second-quarter licence sales at the Ottawa-based company, which exports more than half of its products to the US, missed analysts’ targets, partly because of the exchange rate, according to chief executive officer Robert Ashe. ``It’s affected our outlook a little bit because of that squeeze from the foreign currency,’’ Ashe said in a September 28 interview. European policy makers are signalling growing alarm as the strengthening euro threatens to undermine growth in the 13-nation bloc that shares it.
So friends to the North, thank the Bush administration for once again, manipulating international markets to their detriment.
It's not simply that Patch. Go to any currency exchange website and pull up a graph on the Canadian Dollar vs another currency. You'll find it has most likely gained. It's hard to find one it hasn't. When compared to the US currency it's really striking because the US currency is going the other direction in world trading.
Note: Warren Buffet predicts the Canadian currency will out pass the US's for the at least the next 5 years.
Yes Closet, I know. :) But that is in response to the U.S. Dollar being held artifically low. Safe havens in "North America." The Canadian currency going up is not so much because all of a sudden the Canadian economy is red hot...and it's fine, don't get me wrong. It's because in relation to the U.S. dollar, the Canadian currency offers a safer bet. But you do know that currency values go up and down all the time, right? Just ask George Oros :)
That was just one minor point within a major point. Namely, that a currency value is not even remotely tied to a nations economic health.
Why do I say that? Because all you have to do is look at China and their currency. I mean after all, if China is as red hot as everyone says, wouldn't their currency be the most valuable on the planet? Or, do they keep it low intentionally? By forcing the currency of a major economy down, it automatically forces others up. In this case, the Euro, the Yen, the Sterling, the Canadian dollar, etc. etc. Research it and I think you'll see that the rise in the Candian currency is due to other factors...ones that could cause more problems than you might thing. It's very unfortunate that the Bush administration is causing this.
^ Soros.
It's true that they are investing in a safe heaven but not just because it's in North America.
Here's an excerpt from Barclays Global Investor for peole looking to do just that:
A US slump would be felt in all the major world markets, but one region stands out as being a good bet for the longer term. Ironically enough, this safe haven is not terribly far away from the US - in fact, it’s just north of the border.
Canada has a great deal to recommend it. At a time when the commodities sector is booming, it is sitting on vast reserves of gold, uranium and nickel, to mention just a few of its natural resources. It also happens to have the second-largest oil reserves in the world after Saudi Arabia, in the form of the Alberta tar sands. It’s not easy to get oil out of the sands, but at current prices, it’s more than profitable enough for those companies intent on doing so, which include FTSE 100 stalwart Royal Dutch Shell.
Water, water, everywhere
Canada also has an even more important liquid in abundance. A global water shortage is threatening the economic development of both China and India. Here in the UK, we’ve seen hosepipe bans in the wake of a searingly hot summer, and there have been similar stories of drought conditions across Europe. A full 30% of the global population is expected to experience water shortages by 2025, according to the Centre for Strategic and International Studies. But Canada is one of the most water-rich countries in the world – in fact, it may even be exporting water by then.
And Canada is one of the few developed countries not at risk from a massive house price crash. Certainly, areas such as Alberta have seen prices soar, boosted by the tar sands. But elsewhere in the country, single-digit annual growth is more the norm.
* Play the stockmarket with £100,000 in our fantasy sharetrading game
Too reliant on the US?
The only concern is that Canada does most of its export business with the US – this accounts for about a third of Canada’s GDP. So the country is by no means immune to a slowdown in its neighbour to the south. But it is also expanding its business relationships with China – the far-eastern giant has been hunting all over the world for resources to feed its expanding economy, and it is now working on a deal to create a pipeline supplying oil from Canada to Asia. And if the resources boom continues, Canada is one of the best-placed developed economies to benefit.
How to invest in Canada
So what’s the best way to invest in the country? It should be straightforward enough for UK investors to buy Canadian stocks through their brokers, but that gives you the dilemma of wondering what to buy. A better bet is to buy an exchange-traded fund that tracks the Canadian market.
Voted : Canadian dollar
Last I looked, just slightly. But I haven't checked exchange rates in a couple of days.
Okay, but I'm not clear on what your point is ClosetIguana? No one is saying the Canadian economy is not doing well. I think your reading that into it.
As I said and you should do some research on this, the value of a currency is not really a direct correlation to the overall health of an economy and more to the point, the rise in the Canadian currency is, factually, more tied to the intentional devaluation of the U.S dollar.
So I'm not sure what your main point is and I guess I didn't make mine clear either.
Not sure what your background in economics is, but currency markets are unique unto themselves. The typical rules rarely apply.
To make sure we're talking about the same things, can I ask you:
What is your analysis on China's currency?
What is your opinion on the effect a high value currency does to domestic inflation, corporate profits and commodity prices?
For decades the United States was shackled with an over-valued currency which resulted in the loss of competitiveness on a global scale. Because the U.S. Dollar was the only reserve currency in the world, we could sustain that over-valuation for that time. But now that there is a basket of reserve currencies that includes the Euro, the Yen and the Sterling (for the most part), the pressure is off the Dollar and finally, we can allow the U.S. dollar to decline at a controlled pace.
So my point is, the Canadian dollar may rapidly become over-valued. Some say it is at that point. An over-valued currency is very detrimental to economic growth. That's my point. :)
This is from a Canadian economist:
Soaring Loonie Comes at a Price
A strong currency inhibits manufacturing exports as cheaper currencies in foreign markets compete to sell similar goods and services.
Canada does harbor a plethora of raw materials to feed and grow the world's emerging markets. But the country's non-commodity exports, including forestry, continue to bleed a slow death in 2007. The strong loonie is resulting in mounting manufacturing job losses, rising labor discontent and seriously damaging the country's export platforms in Ontario and Quebec.
So while Western Canada, loaded with natural resources, continues to benefit from the commodity bull market, the rest of the nation climbs deeper into a hole. The rest of the exporters are struggling with an expensive currency and the government's reluctance to cut tax rates. Business leaders have also increased the call to lower interest rates this year to suppress the loonie's value and alleviate manufacturing losses.
Indeed, until the U.S. sub-prime crisis resurfaced in July, the Bank of Canada had been tightening or raising interest rates.
For now, Canada is enjoying a strong currency. It is the best-performing dollar-based unit in 2007. The Canuck buck is up 17% versus the U.S. dollar and even rising 8% versus the almighty euro.
But at some point over the next several months, I expect the loonie to finally head back to earth. I see a U.S. economic slowdown and easier Bank of Canada monetary policy clipping the loonie's wings. Never in Canada's history has it managed to defy a U.S. economic slowdown or recession.
The loonie has further to sail and will probably fetch a premium against the sagging greenback. But 12 months from now, I'll bet the Canadian dollar will buy less, not more, American dollars as the economy slows amid declining trade-flows between both markets.
Canadian manufacturers, who rely on US sales, however, are "the big losers," Marchon said. "Their products are suddenly less competitive in the United States."
Some 80 percent of Canadian exports head south to the United States, and 66 percent of its imported goods originate in the United States.
The Canadian tourism industry also fears the worst, with fewer Americans expected to visit Canada's hinterland, and more Canadians opting for US trips over vacations in their own vast backyard.
Indeed, the number of Americans traveling north fell 5.2 percent in July, year-over-year, to its second lowest level in 35 years, Statistics Canada reported Thursday.
^ 80% of your exports come to us. That's not going to change. Canada's business dealings with China are in raw materials. China needs those. But that is not manufacturing. It is...raw materials, such as metals, etc. Huge difference. Canada like the rest of the Western world is in a hole when it comes to exports of manufacured goods to Asia. The Asian market is a long way from being open to manufactured imports from the West.
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