Foreign Countries Buying Canadian $ And Securities

[Shady]

Russia diversifies into Canadian dollars

Russia’s central bank announced on Wednesday that it had started buying Canadian dollars and securities in a bid to diversify its foreign exchange reserves.

“If it is a barometer for the activity of other central banks, then its is structurally positive for the currencies of countries like Canada and Australia that have a commodity bias in their economies,” he said.

Although not officially confirmed, traders said that other emerging market central banks, including some in Asia which hold large foreign exchange reserves, have also been active in the foreign exchange market in recent weeks buying both Canadian dollars and Australian dollars.

FT

This is a great illustration of how Canada is well positioned in the global economy, not only now, but for the future. There are quite a lot of Canadian economic pessimists in this forum, constantly posting our so-called terrible situation and demise. This clearly shows them to be completely partisan fools, cheering for their own political interests, and not for the good of our country.

[Topaz]

Is this like what China has done to the US? Before long, China and Russia will own North America, monetary.

[bush_cheney2004]

Is this like what China has done to the US? Before long, China and Russia will own North America, monetary.

No...it's more like what the US has done to Canada.

[whowhere]

Russia diversifies into Canadian dollars

Russia’s central bank announced on Wednesday that it had started buying Canadian dollars and securities in a bid to diversify its foreign exchange reserves.

“If it is a barometer for the activity of other central banks, then its is structurally positive for the currencies of countries like Canada and Australia that have a commodity bias in their economies,” he said.

Although not officially confirmed, traders said that other emerging market central banks, including some in Asia which hold large foreign exchange reserves, have also been active in the foreign exchange market in recent weeks buying both Canadian dollars and Australian dollars.

FT

This is a great illustration of how Canada is well positioned in the global economy, not only now, but for the future. There are quite a lot of Canadian economic pessimists in this forum, constantly posting our so-called terrible situation and demise. This clearly shows them to be completely partisan fools, cheering for their own political interests, and not for the good of our country.

Good, every dollar bought, Canada's mint get's to print. If the currency is aquired and spent on Canadian Goods and Services then you truly have a contributor to Canada's GDP. This is only Good if Russia is a growing trade partner of Canada. Otherwise, it's just an opportunity to push out some printed money onto the World. Either way, Canada needs to figure out what Russia is trying to do.

[whowhere]

Is this like what China has done to the US? Before long, China and Russia will own North America, monetary.

Statements like that shows how clueless you are to US style economics.

[whowhere]

No...it's more like what the US has done to Canada.

Canada still has its own currency and as long as the US is pumping up the currency with the US thirst for Canada's oil Canada is clearly in a position to play by the same economic play book.

[Bugs]

Topaz, on 20 January 2010 - 07:08 PM, said:

Is this like what China has done to the US? Before long, China and Russia will own North America, monetary.

No...it's more like what the US has done to Canada.

No, it's more like what the Obama Democrats have done to America!

One key thing is that the US government has guaranteed a lot of the bank debt when the bailouts occurred. If the economy -- that is, the private sector economy -- doesn't come to life, and start creating jobs at at least a 200,000/month rate by June, then a lot of that money will have been wasted. With every month that ticks over, the realization grows that the stimulus part of his economic plan has failed. We can watch Obama's political base crumbling under him.

We are seeing the American government becoming increasingly confused and disabled. Obama has to react. Will he slow down, move to the center, and concentrate on jobs? Or will he continue, undeterred by his setback on Health-care?

[nicky10013]

Good, every dollar bought, Canada's mint get's to print. If the currency is aquired and spent on Canadian Goods and Services then you truly have a contributor to Canada's GDP. This is only Good if Russia is a growing trade partner of Canada. Otherwise, it's just an opportunity to push out some printed money onto the World. Either way, Canada needs to figure out what Russia is trying to do.

Russia is just trying to stay afloat. They're attempting to stabilize the ruble while keeping alive their oil industry. The drop in the price of oil has robbed them of hard currency and they've got nothing to fall back on in terms of industry. Agriculture is still collectivized and the latest Russian industry predates 1991.

Edited January 21, 2010 by nicky10013

[bush_cheney2004]

...We are seeing the American government becoming increasingly confused and disabled. Obama has to react. Will he slow down, move to the center, and concentrate on jobs? Or will he continue, undeterred by his setback on Health-care?

No matter...the point is that Canada can only react to whatever happens, so closely is its fortune tied to the gravity of an American Jupiter.

[xul]

Is this like what China has done to the US?

I think foreign exchange speculation isn't like what China has done to the US, its effect is worse than that.

What China buys from the US is its public dubts. The action bands Chinese investment with the success of American economy. If American economy fail, Chinese investment will also suffer loss. If China wants to sell these dubts, it has to find another buyer, it is not easy when these debts are devaluing, so China has to help America to re-boom it economy. America has no obligation to buy back these dubts unless they are expired.

As to Russian has bought some Canadian dollars, it is totally another matter. If someday they want selling them, what they need to do is to go to the Bank of Canada and demand the bank to repurchase them. Canada's central bank has no rights to refuse the request unless Canadian wants their country becomes another Zimbabwei.

Generally, foreign exchange speculation may make Canada Dollars overvalued or undervalued periodically. It is not good for Canada's economy, especially manufacturing sector.

Edited January 21, 2010 by xul

[Moonbox]

As to Russian has bought some Canadian dollars, it is totally another matter. If someday they want selling them, what they need to do is to go to the Bank of Canada and demand the bank to repurchase them. Canada's central bank has no rights to refuse the request unless Canadian wants their country becomes another Zimbabwei.

I don't even think you know what you are trying to say. Sure, the BoC would probably buy the Russian-held dollars back, but it would be at that day's exchange rate, which might be better or worse. So what?

As for what this means, I would say very little. It means that Russia thinks Canada's currency will boom in the near future, or at worst be more stable than the USD. As for all currency fluctuations, it's good for some and bad for others.

[Shady]

No matter...the point is that Canada can only react to whatever happens, so closely is its fortune tied to the gravity of an American Jupiter.

I agree. Which is why I hope that America soon sheds it's current economic-illiterate-in-cheif.

[Topaz]

Statements like that shows how clueless you are to US style economics.

That is your opinion ans you are free to have it, but, as the same time, it is known that China and Russia have been in the US passing counterfeit money. The aim is the flood the US with worthless paper, so there would not be REAL stuff out there. They didn't realize GW would keep printing and printing. Let's hope that the new Minister Nay Day, can tell the difference!

[William Ashley]

mulling is better than milling.

The dollar is collapsing like the ruble.

The Russian central bank lived economic collapse, I'm sure they see some of it in the USD.

USD is failing to the Euro not in the past 5 months though.

Who the hell wrote this?

"Canada’s dollar, nicknamed the loonie"

Is it acceptable to call the CAD the loonie? I thought this only applied to the coin, not the currency..

Edited January 22, 2010 by William Ashley

[whowhere]

That is your opinion ans you are free to have it, but, as the same time, it is known that China and Russia have been in the US passing counterfeit money. The aim is the flood the US with worthless paper, so there would not be REAL stuff out there. They didn't realize GW would keep printing and printing. Let's hope that the new Minister Nay Day, can tell the difference!

Twenty years ago I went to New York city and they had the debt counter up. It was accumulating rapidly then, and not much has changed. The US wasn't concerned about it then and they are probably not to concerned about it Now. The US invented the modern economic game and they are playing anyone and everyone accordingly. This game started way back in the day when they disassociated their currency from Gold. The world can ridicule the US all it wants. I doubt the Russian Government is passing countefeit US currency. If they were, they would likely use conterfeit currency to buy US made goods they want or use that currency to buy their Ruble to push up the value. Currency is game and the US is educating the world accordingly.

As for Jobs, the US has to start dangling money to subcontractors listed on the Stock Exchanges to build Government Projects. This will get people back to work and begin boosting stock prices.

The world is at this point because of Corporate corruption and Government apathy. Then again maybe this is the new norm, and the world will drift sideways for awhile. In any case Canada needs to find a strike point on the currency and begin to covertly stockpile foreign currencies to be used to prop up Canada's currency when Required. Canada has to start being more industrial and a designed based country rather than a flow through for companies wanting access to the US market. Canada needs to have Canadian products commissioned by the Government and used by Canada via the sub contract model of companies listed on the stock exchanges. If the products are world class get them on the shelves of world, if not keep them sustained by Canada until they are.

The economic model is not clearly understood and Canada is lagging because of it.

[Alta4ever]

Twenty years ago I went to New York city and they had the debt counter up. It was accumulating rapidly then, and not much has changed. The US wasn't concerned about it then and they are probably not to concerned about it Now. The US invented the modern economic game and they are playing anyone and everyone accordingly. This game started way back in the day when they disassociated their currency from Gold. The world can ridicule the US all it wants. I doubt the Russian Government is passing countefeit US currency. If they were, they would likely use conterfeit currency to buy US made goods they want or use that currency to buy their Ruble to push up the value. Currency is game and the US is educating the world accordingly.

As for Jobs, the US has to start dangling money to subcontractors listed on the Stock Exchanges to build Government Projects. This will get people back to work and begin boosting stock prices.

The world is at this point because of Corporate corruption and Government apathy. Then again maybe this is the new norm, and the world will drift sideways for awhile. In any case Canada needs to find a strike point on the currency and begin to covertly stockpile foreign currencies to be used to prop up Canada's currency when Required. Canada has to start being more industrial and a designed based country rather than a flow through for companies wanting access to the US market. Canada needs to have Canadian products commissioned by the Government and used by Canada via the sub contract model of companies listed on the stock exchanges. If the products are world class get them on the shelves of world, if not keep them sustained by Canada until they are.

The economic model is not clearly understood and Canada is lagging because of it.

So you support corporate welfare?

[Smallc]

Oh great. Look what you started Shady... This thread makes about as much sense as a Family Guy joke (not the opening post, but most of the responses) and it's far less funny.

[xul]

I don't even think you know what you are trying to say. Sure, the BoC would probably buy the Russian-held dollars back, but it would be at that day's exchange rate, which might be better or worse. So what?

As for what this means, I would say very little. It means that Russia thinks Canada's currency will boom in the near future, or at worst be more stable than the USD. As for all currency fluctuations, it's good for some and bad for others.

Let's assume that there was a businessman named Mr.Khanada, and for somehow he needed some money to improve his business. There were two bankers caming forth. The first one offered him a loan of 3 years without recovery ahead of schedule. The second offered the same amount of loan of unlimited period but with the condition that the bank could recover it at any time. Do you think the two offers were the same to Mr.Khanada? If Mr.Khanada came to you for consultation, which offer would you like to suggest him to accept?

If Mr.Khanada's business was to make CD-ROMs, keyboards, power supplies...etc, for HP or Dell, would you think the CEOs or MBAs would still keep in good mood when they received an offer from Mr.Khanada which told them that all these products's prices had to rise 20% than it was three months ago because exchange rate had changed rapidly?

Edited January 23, 2010 by xul

[whowhere]

So you support corporate welfare?

Get with with the program, that is the backbone of the US economy. If it were not for government spending the US would not be where it is. Pay attention to US spending versus tax collection and you will see they just continue motoring onward. Unfortunatley, Canada just does not understand US economics. This is obvious; compare US infrastructure to Canada infrastructure, it's quite telling.

[Shady]

Get with with the program, that is the backbone of the US economy.

Huh? The US government's budget is 3 trillion dollars. The US economy is 15 trillion dollars. How is 3 trillion the backbone of 15 trillion? Especially when the 2/3 of the 3 trillion is spent on healthcare and social security.

[Moonbox]

Let's assume that there was a businessman named Mr.Khanada, and for somehow he needed some money to improve his business. There were two bankers caming forth. The first one offered him a loan of 3 years without recovery ahead of schedule. The second offered the same amount of loan of unlimited period but with the condition that the bank could recover it at any time. Do you think the two offers were the same to Mr.Khanada? If Mr.Khanada came to you for consultation, which offer would you like to suggest him to accept?

If Mr.Khanada's business was to make CD-ROMs, keyboards, power supplies...etc, for HP or Dell, would you think the CEOs or MBAs would still keep in good mood when they received an offer from Mr.Khanada which told them that all these products's prices had to rise 20% than it was three months ago because exchange rate had changed rapidly?

Like I said, these things are good for some and bad for others. A lower dollar is good for exporters but bad for importers and consumers. The opposite is true as well, although prices are a bit stickier on the way down.

No need to teach me economics 101. I get it.

[ZenOps]

Well..

Canadian currency is fairly safe as long as Queen Elizabeth II is on the back of our coinage.

I fear for our dollar however - the day we decide to put Charles on the back. IMO, much like using Tiger Woods to "champion" a corporation, public perception has a huge impact on perceived value.

http://www.reuters.com/article/idUSTRE5BS38I20091229

IMO - Charles is already long past Tiger Woods in terms of lost public appeal. However - I am completely inclined to agree with and champion an engraving of the British Crown on the back of our coinage if necessary.

[Smallc]

I still think I'd be more comfortable with the Canadian Crown.

[ZenOps]

If you can get Prince William to defect to Canada - it just might be possible.

Otherwise the only way someone from Canada will get to be on the back of the coins - is to get full independance. Of which I've mentioned before - we simply do not have the military strength to do (Not that we would probably have to fight the British to attain independance, but we would have to be able to protect ourselves from the other sovereign nations of the world)

Were much in the same boat as Tibet in that manner. If Tibet ever ousted China - you can be assured there would be a dozen european nations looking to subjugate.

[Smallc]

You obviously have no idea what you're talking about.