Canadian Dollar Parity With US Dollar Looms

""Further gains of only around 15 percent from current levels would put the U.S. dollar at C$1.00 for the first time ever.""???



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Nothing in this World makes People so Afraid as the Influence of an Independant Minded Individual.
Attrib. Al Einstien

I live in a border community and I remember back in the 70s going across to the U.S. with my mother to shop and our dollar was trading at 10 cents MORE than the USD! The real problem, of course, will start when the U.S. and Canada harmonize their currencies.

>> I remember back in the 70s <

I was in the Navy at the time and begrudgingly paid in American $$ because it was the only currency excepted throughout the world. We currently have a trade surplus and that will end should our dollar rise much more. Canadian exporters will complain bitterly as did Japan when the Yen increased. The low dollar is good for some and appreciated by Canadians who prefer to spend in foreign countries.

The low dollar is good for some "and appreciated by Canadians" who prefer to spend in foreign countries.

Should be "and the higher dollar appreciated" by Canadians .......

I recall when I was a kid hearing that $1 Cdn was about 1.15-1.20 US, that was about 1967-69.

Anyone else here recall anything similar?

I seem to remember that throughout the 50s and 60s the C dollar traded on par or slightly higher than the US dollar. Ours might shoot up higher though, if Iran goes ahead with its petro-euro market and the US doesn't nook it.(The real reason why they are harrassing the Iranians)

our dollar was pegged at US$1.06 during the pearson/trudeau years i think

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"George Bush has declared the war on terrorism to be the cause of his generation. The cause of Canadian sovereignty will be ours." - John Godfrey, MP for Don Va

Check this site out, where you can get .pdf files of past currency exchange rates, all the way back to 1948 - very interesting to compare the rates with what was going on historically:<br />
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<a href="http://fx.sauder.ubc.ca/etc/USDpages.pdf">http://fx.sauder.ubc.ca/etc/USDpages.pdf</a><br />
<br />
1957 we were at .95 against the USD (year average)<br />
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2002 we were at 1.55!! In the span of 3 years, we went to 1.13 (average for end of January 2006)<p>---<br>"It's a heck of a place to bring your family." —George W. Bush, on New Orleans, La., Jan. 12, 2006

Hmmm.... just trying to imagine what would be good about having our dollar equal to the US dollar. Lets see, our trade surpluss would further diminish, this creates potential for greater unemployment, foreign investment would decrease, tourism may well decrease also, sectors like R & D and manufacturing would suffer, travell to the US by Canadians would increase along with the associated spending, etc..... But wait. American beer would be less expensive! Ahh hell, who am I trying to kid? American beer isn't any good at any price.
Well maybe the Japaneese got it right by artificially controlling their currency against the US. It seems to be putting GM in big trouble anyway.

Good points. A question: When our dollar rises against the US dollar, does it rise against the UK Pound and Euro?

As for the beer comment, I am not a beer drinker so beer isn't good to me at all at any price!

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"A person who walks in someone elses footprints leaves no footprints." Chinese Proverb

One thing rarely discussed is that when free trade was brought in,the american concern was the 'unfair' aspect of having a much lower traded canadian currency. The canadian government reassured the americans that they would increase the value of the canadian to US levels to 'level the playing field'. I see almost NO mention of this, and the 'common thinking' is that government has no power over trade rates, but apparantly this isn't true. Although I can't find any reference to how they actually control this, I read the article awhile ago but it was an academic, footnoted source, so the information was pretty reliable. I do agree that 'if' it hits parity, THEN we'll be seeing the 'get rid of th e dollar "comments'

Mr. Can-Euro
Good question, and one that I wonder about as well. I am certainly not well enough versed in the monitary economics side of things to provide a reliable answer to this, but my understanding is that one doesn't necessarily relate to the other except when using the US dollar as the benchmark. Therefore if the Euro remains unchanged in relation to the US dollar while the Canadian dollar appreciates then it would in camparison have gained against the Euro as well. However, in terms of trade with European countries using the Euro and exclusive of a US dollar consideration I wouldn't think it necessarily translates. Exactly how one currency is compared to another is somewhat of a mystery to me I'm afraid.
I am sure there are other contributors here who can be of more help to us both on this one.
By the by, speaking of beer, Moosehaed breweries in Saint John, N.B. exports it's products to all 50 states. In fact I believe their exports out pace their domestic sales. I'll bet they aren't happy about the gaining strength of the buck. It's the kind of thing that causes companies like this to decide they need to produce the product in the US rather than Canada to satisfy the strength of the US demand thereby exporting valuable jobs and investment out of Canada. I'm not saying this is being done by this company, but it is the kind of downside to a strong dollar we can reasonably expect.
Now - maybe I should go blow the dust off my old economics text books

In the '50s the Canadian Dollar was .5 cents higher than the US and later it went to .10 cents. When we were in the USA it was best to change our money in a bank, as the merchants would not pay the right amount. .10 cents was about the highest.

The Canadian Dollar was floated against the US under Pearson, mostly on the advice of Simon Reisman, who was then some Deputy Minister, and later, after his retirement, a lobbysist for the Grand Canal project for the diverting of Canadian waters, and then the head of the Canadian delegation at the Canada - US FTA talks.

The main purpose of the fluctuation is pure and simple speculation by the large corproations who now, often make most of their profits on the money markets.

It is also a well kept secret that throught the changes in monetary values the dimensions and measurements of trade goods are also changed, making huge profits to the speculators.

Ed Deak, Big Lake, BC.

A high valued dollar isn`t all bad. After all, the US used their higher valued dollar (albeit fake) as a way to easier buy Canadian companies and resources. (Not to mention politicians.) Perhaps a government with vision in Canada could use a high valued dollar to buy back what we lost! The US is broke, after all, and they`re going to have to sell some things when their economy finally runs out of fumes.

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Dave Ruston