Friday, September 21


Well, what would have been unthinkable even five years ago has now happened. The Canadian dollar is now roughly equal to the US Dollar. As of this writing, the Loonie is equal to .99730 dollars, but was trading higher than the US dollar yesterday.

Why did this happen. Well, right now, everyone is pointing to the Fed rate cut this week. That might have been the impetus for this particular decline, but it isn't the real answer.

Part of the answer is that Canada has what we all want; oil. Another part of the reason is the fact that collectively, the US market has been buying goods on credit for far too long. We buy more than we sell, and as a result, our creditors (primarily China) are banking huge reserves of US Dollars.

Since about 2003, our Administration has been pushing a weaker dollar as part of the answer. Ideally, it should be strengthening our exports and putting the cold water on imports.

In any case, hopefully we will see more Alberta plates in front of our shopping establishments.


Anonymous said...

Pushing the dollar down, but also pushing average wages down with a surge of illegals.

Nobody wins but the multinational companies and the money traders.

Treasure State Jew said...


Not even sure that they win. Well, the money traders do, but I am not sure about the multinationals.

Who really wins is those with hard assets. Oil, which is at an all time high. Gold, which hit $732 yesterday. Hells bells; copper is closing in or $4/lb!

Which usually means more money going to corrupt, violent regimes. Well, a lot of violent, corrupt regimes and a lot of polite Canadians, anyway.