Canadian Dollar at Parity with the US Dollar

[bush_cheney2004]

Yes we do import some refined products but when it comes to crude oil, Canada imported just under a billion barrels of oil a day in 2005 while exporting nearly 1.6 billion. We are more than self sufficient when it comes to crude.

No, in fact you are not. One of the main reasons you import about 1 billion bpd in the east is because of oil production, distribution, and refining capacity quirks that defy self sufficiency. Tar sands oil is not exactly sweet Texas crude if you know what I mean.

[jdobbin]

But yet, the economy is in very good shape. We are diversifying our export portfolio, a very smart move.

With the value of the dollar, Canadians can buy more U.S. companies as they will be cheaper. This will be an excellent way to expand Canadian companies by getting access to both their market and high technology.

[bush_cheney2004]

With the value of the dollar, Canadians can buy more U.S. companies as they will be cheaper. This will be an excellent way to expand Canadian companies by getting access to both their market and high technology.

U.S. companies?....but haven't you heard...the USA is collapsing. Best to buy Chinese companies and technology...they will send a man to the moon by 2025!

[old_bold&cold]

I really do not think the CDN will go as far as being double that of the USD, but you never know. The price differences here in Canada at this moment are such that partity pricing had better happen in the next 6 weeks or a lot of those who do not adjust will just have no customers. There is room for some differences, but by that I mean less then 5%, if companies try to get more then they are going to have the backlash of the Canadian consumer, and once that starts there is no way to stop it. If the automobile sector does nto do this by the new year, then they might as well start laying off people, as consumers will not allow the 20-30% differences that exist now. In fact once the looney hits $1.10, Canadians will expect lower prices then the USA. Same for all large store chains.

[bush_cheney2004]

.... In fact once the looney hits $1.10, Canadians will expect lower prices then the USA. Same for all large store chains.

Or they'll do what? Please explain how the Canadian consumer in Churchill will rise up and strike back at the evil capitalists when buying toilet paper with a choice of two softness levels.

[Jerry J. Fortin]

I will suggest that the loonie will go up as much as the US dollar goes down. The thing to keep in mind is the rising cost of energy and the declining number of manufacturing jobs.

For Canada this is a problem because we are losing jobs and our dollar keeps getting higher. This translates into a boon for consumers only if they have the means to purchase the lower priced imports. The situation as it stands can continue for a while I think but in the long term if our government does not find a way to use the advances in disposable income of Canadian families to invest in this country we will soon find out how fast our dollar will drop. Its demise will spell a very hard time for Canadians.

[Wilber]

No, in fact you are not. One of the main reasons you import about 1 billion bpd in the east is because of oil production, distribution, and refining capacity quirks that defy self sufficiency. Tar sands oil is not exactly sweet Texas crude if you know what I mean.

Not all the oil we produce or export comes from the tar sands. We import because it makes sense economically in different parts of the country. We pay world price regardless of where it comes from. One reason we import is because central and eastern Canada didn't want to pony up for a pipeline in the days of cheap foreign oil. The US lucked out as a result because the line now runs north south instead of east west.

[M.Dancer]

If it is a small consolation, savvy manufacturers can use the strength of the loonie to buy resources and to retool for greater efficiancy now rather tha later. What with low interest rates....

....I did say small consolation.....

[old_bold&cold]

Or they'll do what? Please explain how the Canadian consumer in Churchill will rise up and strike back at the evil capitalists when buying toilet paper with a choice of two softness levels.

The consumers in Churchill will order thru the net and yes they do this already and have much of it for the year shipped there by ice road trucking and rail. They are easier to stand up to this as they have to order a year ahead and ship mostly during the winter. But if prices have not equalled out by Christmas, the consumers will have bought on line from USA pr gone shopping there. Since most of store revenues come from the Christmas shopping season, you will see all those who did not adjust prices having going out of business sales in January. Canadians have learned something, that Americans will have to learn and that is when the price is too high, you just do not buy. Only necessities like food is where you need to spend. We learned to take care of personal debt and then wait for things to change to lower prices, or go where the price is still cheap. The USA will learn this as their dollar goes lower, it is not as if they can skip that part.

Hell I have bought things from countries all around the world and got very good deals even with shipping and duties etc. That is why I said Canada is not worried that the USA will stop buying from us, as we all know now that it is a world market, and that means that you do not have to feel locked inot any deals anymore.

Edited November 7, 2007 by old_bold&cold

[Guest coot]

Or they'll do what? Please explain how the Canadian consumer in Churchill will rise up and strike back at the evil capitalists when buying toilet paper with a choice of two softness levels.

About 90 percent of all Canadians live within an hour of the border. Not very many people live in Churchill.

[M.Dancer]

There will be significant price cuts come december, bank on it.

For a few good reasons.

1)Inventories purchased beofre parity will be thinning

2)Pressure by internet and cross border shopping.

3)Retailers aren't nearly as stupid as they were in the 90s.....think, Aubergine!

[bush_cheney2004]

Not all the oil we produce or export comes from the tar sands. We import because it makes sense economically in different parts of the country. We pay world price regardless of where it comes from. One reason we import is because central and eastern Canada didn't want to pony up for a pipeline in the days of cheap foreign oil. The US lucked out as a result because the line now runs north south instead of east west.

The reasons are interesting, but changes nothing....Canada is a net oil exporter, but is not self-sufficient for crude oil or refined distillates.

Edited November 7, 2007 by bush_cheney2004

[bush_cheney2004]

About 90 percent of all Canadians live within an hour of the border. Not very many people live in Churchill.

Thank you....I always chuckle a bit when reminded of that. Amen for the border!

[Smallc]

Thank you....I always chuckle a bit when reminded of that. Amen for the border!

Yes, I think that all Canadians are thankful for the line that runs along the 49th parallel.

[bush_cheney2004]

....Hell I have bought things from countries all around the world and got very good deals even with shipping and duties etc. That is why I said Canada is not worried that the USA will stop buying from us, as we all know now that it is a world market, and that means that you do not have to feel locked inot any deals anymore.

I'm not buying it (pun intended)...sure, some Canadians may be able to wait it out or shop the Internet, but most will still get hosed locally. Whenever I sell something to a Canadian via online auction, it is because the item simply isn't available in Canada's smaller market and/or they want to beat import duties and god-awful taxes. As I have described before, one chap in London, Ontario asked me to declare value of a $2,000 item at $300 just to beat the system and take the insurance risk.

Edited November 7, 2007 by bush_cheney2004

[bush_cheney2004]

Yes, I think that all Canadians are thankful for the line that runs along the 49th parallel.

Why do birds suddenly appear

Every time you are near?

Just like me, they long to be

Close to you.

[Wilber]

The reasons are interesting, but changes nothing....Canada is a net oil exporter, but is not self-sufficient for crude oil or refined distillates.

We could be self sufficient in crude but you would have to get a bunch of yours from elsewhere. I suspect most middle eastern oil producers are not self sufficient when it comes to refined products. The reason they are not is because under the present circumstances it doesn't make economic sense to do so. It is a matter of choice based on economics, not necessity.

[bush_cheney2004]

We could be self sufficient in crude but you would have to get a bunch of yours from elsewhere. I suspect most middle eastern oil producers are not self sufficient when it comes to refined products. The reason they are not is because under the present circumstances it doesn't make economic sense to do so. It is a matter of choice based on economics, not necessity.

The two are one and the same.

[Wilber]

The two are one and the same.

Yet it is a choice the US does not have.

[bush_cheney2004]

Yet it is a choice the US does not have.

Of course it does....the US "chooses" oil...for now.

[Wilber]

Of course it does....the US "chooses" oil...for now.

[Higgly]

The loonie hit $US 1.10 this morning. We are definitely in uncharted waters here. If this keeps up for long, we will see major structural shifts in our economy. Oil is now at over $US98 per barrel, but that is largely a factor of the sinking US dollar. Much is made of the value of gold rising as the US dollar falls, but the truth is that every commodity rises when the US dollar falls because they are all priced in US dollars.

It is beginning to look like foreign interests are bailing on the US dollar in a big way. If that is so, we might see a meltdown in the US stock market in the not too distant future. Things could start to get real ugly.

[Guest American Woman]

Interesting Article

Loonie's flight worries bank--

The loonie flew to another record versus the U.S. dollar yesterday, and stayed sky high despite suggestions by Bank of Canada senior deputy governor Paul Jenkins that the currency may be overvalued.

Evidently the sudden rise in value of the Canadian dollar could be worrisome for Canada too.

[Guest coot]

The loonie hit $US 1.10 this morning. We are definitely in uncharted waters here.

No, no. Don't you get it? It's a deliberate meltdown. They want investors to have absolutely no confidence in their currency. They want to effectively pay double for their oil and have unprecedented stagflation.

[August1991]

The loonie hit $US 1.10 this morning. We are definitely in uncharted waters here. If this keeps up for long, we will see major structural shifts in our economy. Oil is now at over $US98 per barrel, but that is largely a factor of the sinking US dollar. Much is made of the value of gold rising as the US dollar falls, but the truth is that every commodity rises when the US dollar falls because they are all priced in US dollars.

It is beginning to look like foreign interests are bailing on the US dollar in a big way. If that is so, we might see a meltdown in the US stock market in the not too distant future. Things could start to get real ugly.

Higgly, this is what market prices do. The prices go up and down to reflect different perceptions and different realities.

You're not the first person who has seen a price change and then worried about some impending doom. The world is constantly changing and it's normal that market prices will change too. The price of oil was as low as $10 per barrel less than 10 years ago. In real terms, the price of oil was about the same in 1980 as it is now. The Canadian dollar fell to about 65 cents US just a few years ago. Prices go up and down.

We don't live in a static world and it is illusory to believe that anyone can offer us some kind of permanence.

Moreover, these price changes are the result of millions of peoples making individual decisions and because of the changes, millions of people will change their behaviour. It's a remarkable cooperative effort to observe.

Edited November 7, 2007 by August1991