$1CDN = $1US

[truthteller]

My father used to tell me stories about this a long time ago.

 

 

 

TRUTH

[MunkyMan95]

Is that a good thing, or a bad thing?

[TomB]

The US dollar had been significantly stronger than the Canadian dollar for much of the last 30+ years, so you can really see a loss of value of the US dollar vs. the Canadian dollar with this exchange.

[bsshog40]

I can remember being in germany in the late 70's and be able to get 3-4 German $1 marks to the dollar. Now the US dollar is worth .71 in Euro.

[MunkyMan95]

Oh, not good then. Not good at all.

[physics-fan3.14]

No, monkey, this is not good. The US dollar has been sliding for a long time, while the euro has been strengthening. I saw an article on Fox today that was talking about how countries were starting to use the Euro as a reserve currency, instead of the dollar. The rate cut on Tuesday did nothing to help the dollar, either. But sometimes, it's more important to shore up the domestic economy and forget about the rest of the world for a little while. In related news, silver and gold are going straight up again.

[xJack]

Gold and Silver are up as a direct result of the rate decrease - furthur down pressure on the dollar.

 

As for the USD$ = CDN$, it's bad.

 

It hurts both sides of the border - Canadian exports to the US will decline, forcing their unemployment and national healthcare costs up. We take it with both barrels since our CPI is on its way up!

 

 

 

No one wants to say it anymore, but there used to be a word for this - INFLATION.

[TJ'S Coins]

I was raised in a border city where Canadian coinage was accepted on par with US but paper money was always discounted. Was it the intrinsic value of the metal composition? Nah, it was too difficult to figure the exchange rate on coins so it was accepted on par.

[gmarguli]

BFD. It was under 62c around 5 years ago. Things fluctuate. People can get better returns on investments outside the US right now. It's not the end of the world. Stop playing Chicken Little.

[bsshog40]

BFD. It was under 62c around 5 years ago. Things fluctuate. People can get better returns on investments outside the US right now. It's not the end of the world. Stop playing Chicken Little.

 

Does this mean if I wait for a little while I can get 4 marks on the dollar again? lol

[physics-fan3.14]

BFD. It was under 62c around 5 years ago. Things fluctuate. People can get better returns on investments outside the US right now. It's not the end of the world. Stop playing Chicken Little.

 

I'm not playing chicken little, just being honest. In a free market, things fluctuate but will always reach an equilibrium. Of course, we are not in a free market, but close enough. Investors will seek elsewhere for a little while, maybe a couple of years even. But then, the US will be cheap, so the money will come back. Its a cycle.

[jesbroken]

Bobby, I was in Germany in the early 70's(71,72,73) and went to bed on an October Sunday with the Mark equal to a quarter(4 marks to the $) and woke up by a knock from the landlord telling us our rent was up 33%(had to move back on base). Within a week the mark was at 2.8 to a $. Tough times for the American public who never even realized how much money they lost overnight.

[MikeInFL]

The weak dollar is concerning, but has some positive effects...

 

For companies in the US that do business and get paid in other currencies, the weak dollar is actually a good thing. Same for US exports, which are now cheaper than their stronger-currency competitors.

 

The key question in my mind is where is the dollar's bottom?

[MunkyMan95]

The weak dollar is concerning, but has some positive effects...

 

For companies in the US that do business and get paid in other currencies, the weak dollar is actually a good thing. Same for US exports, which are now cheaper than their stronger-currency competitors.

 

The key question in my mind is where is the dollar's bottom?

 

 

[gmarguli]

BFD. It was under 62c around 5 years ago. Things fluctuate. People can get better returns on investments outside the US right now. It's not the end of the world. Stop playing Chicken Little.

 

I'm not playing chicken little, just being honest. In a free market, things fluctuate but will always reach an equilibrium. Of course, we are not in a free market, but close enough. Investors will seek elsewhere for a little while, maybe a couple of years even. But then, the US will be cheap, so the money will come back. Its a cycle.

 

I completely agree.

 

The masses are always panicked the most at the bottoms and confident the most at the tops. That's why the masses usually don't get the best returns on their investments.

[conqueror]

If you plan on traveling out of the country it is a bad thing.

 

If your business need tourist it is a good thing.

 

John

[physics-fan3.14]

 

I completely agree.

 

The masses are always panicked the most at the bottoms and confident the most at the tops. That's why the masses usually don't get the best returns on their investments.

 

People just don't understand buy low and sell high. If you have money, now (or maybe wait another couple of months) is the time to buy everything in sight. Don't lose your confidence and panick with the rest of the lemmings.

[World Colonial]

The weak dollar is concerning, but has some positive effects...

 

For companies in the US that do business and get paid in other currencies, the weak dollar is actually a good thing. Same for US exports, which are now cheaper than their stronger-currency competitors.

 

The key question in my mind is where is the dollar's bottom?

 

We do not know when or where the bottom is, because if we did, then we would all be rich.

 

But by a lobsided margin, a tanking currency is a negative. The value of our savings is worth less because the USD has lost 33% of its value since 2002. Sure exports will be helped but there is not one single example that I am aware of where any country ever depreciated their currency on their way to prosperty. On the other hand, there are many examples (think third world countries) where the standard of living fell.

 

And eventually, it will here too when the USD loses its status as the world's reserve currency. The external debt this country has accumulated, though much more than I and many others could have imagined, cannot continue to accumulate forever.

 

On the subject of things moving in cycles, that is true but not necessarily in the sense that it will be a roundtrip ride. Most people have never seen a long term chart of foreign exchange rates. I have and here are a few examples. The GBP used to be worth $5.60 at the turn of the 20th century and $4.80 around 1930. Today even though it is at a multi-year high, it is only worth $2 and this is against a currency that is tanking. (As a corollary, I read somewhere that British consumer prices have increased more than 3000% since 1950.)

 

Both the USD and GBP have crashed against the CHF. From about 7 and 25 to one in 1920 to about 1.15 and 2.3 today. The South African Rand was worth $1.50 when I arrived in 1972, $1.15 when I left in 1974 and about 14 cents today. So while these currencies, including the USD, have their bull and bear markets, when the long-term trend is up (or down), it can last a long time.

[just-john]

When the oil selling country's demand payments in Euros and not Dollars then you will see the spoon hit the fan and soon after Silver and Gold take off to new highs and gas could double.The good thing is since we buy most of the worlds products because most Americans send more than they make like the government shows us. The dollar will make a comeback soon or the world will be out of work.Our foreign debt is so large whole world economy can't absorb that big of a hit .WE WIN

[Keleum]

I live near lake Ontario so my recent trip to niagara falls, was scaled back, the usual shopping excursion was nixed. As the exchange rate has been 1:1 for all practical purpose for a while now.

 

I'm not sure it's really a reflection on how bad our economy is, as much on how good the canada is doing. They have huge oil/gas and mineral reserves so canada, russia etc, are getting a huge shot in the arm.

 

As for the euro, europeans (ECB) are trying hard to maintain parity with the US. They are willing to sacrifice some, as are the Chinese to prop up their currency against the USD.

 

So while we certainly have troubles (read the evil "I" word) right here, I don't agree the USD falling is solely because of them.

[DC Dawg]

I'm not sure it's really a reflection on how bad our economy is, as much on how good the canada is doing. They have huge oil/gas and mineral reserves so canada, russia etc, are getting a huge shot in the arm.

It has a lot to do with the US economy, especially when you calculate the dollar versus other world currencies. It has a lot to do with US monetary policies and how the world perceives the strength of the US dollar. It has a lot to do with the credit issues, war spending, and other areas where money is going to debt-related issues rather than growth-related issues.

 

As for the euro, europeans (ECB) are trying hard to maintain parity with the US. They are willing to sacrifice some, as are the Chinese to prop up their currency against the USD.

This time, it was the United States who did the sacrificing. During the most recent credit crisis, the ECB started to inject additional funds into the economy. The ECB did this for three days before the Fed did the same. In fact, the Fed's response was three days of increasing the money supply in order to stabilize the dollar against the Euro and other currencies, especially since much of this debt is held outside the US. There were fears that without something to stabilize the international market, the result could be foreign-held notes would be sold off at less than value, which would have put the US economy into an instant depression.

 

Right now, it's in the Fed's interest to keep the cost of the dollar down while cleaning up the credit mess. With the uncertainties, the lower dollar prevents foreigners from dumping their US securities on the market at lower values and driving up market interest rates in order for them to make up the values. It is a very messy problem.

 

So while we certainly have troubles (read the evil "I" word) right here, I don't agree the USD falling is solely because of them.

The dollar is falling because of the bad spending policies of this government, a too high debt-to-GDP ratio, and that the recent credit crisis has slowed down the movement of money. This is why the Fed lowered the Fed Funds and Discount rates... they are trying to get money moving to prevent stagflation!

 

As for us common folk... try buying from foreign sources on the US dollar! It will be cheaper and you will be helping the economy.

 

Scott

[Keleum]

It has a lot to do with the US economy, especially when you calculate the dollar versus other world currencies. It has a lot to do with US monetary policies and how the world perceives the strength of the US dollar. It has a lot to do with the credit issues, war spending, and other areas where money is going to debt-related issues rather than growth-related issues.

 

Certainly the policies of the US affect the USD the most, but this thread was talking about the canadian dollar and USD. I was pointing out that canada's economy is robust and growing which pushes the value of the canadian currency up against all currencies.

 

This time, it was the United States who did the sacrificing. During the most recent credit crisis, the ECB started to inject additional funds into the economy. The ECB did this for three days before the Fed did the same. In fact, the Fed's response was three days of increasing the money supply in order to stabilize the dollar against the Euro and other currencies, especially since much of this debt is held outside the US. There were fears that without something to stabilize the international market, the result could be foreign-held notes would be sold off at less than value, which would have put the US economy into an instant depression.

 

Right now, it's in the Fed's interest to keep the cost of the dollar down while cleaning up the credit mess. With the uncertainties, the lower dollar prevents foreigners from dumping their US securities on the market at lower values and driving up market interest rates in order for them to make up the values. It is a very messy problem.

 

We can argue about the motivations of the ECB and the Fed, I see it differently despite the press releases.

 

I was talking more about the Canadian dollar and that it is strong against the USD and other currencies and not just because of US policies.

[jom]

This is why the Fed lowered the Fed Funds and Discount rates... they are trying to get money moving to prevent stagflation!

 

I think what you meant was that the Feds were trying to help growth not prevent stagflation. Stagflation is when output growth is slowed but inflation is still high. When the Feds make money easier to get (low rates) this makes the economy grow and will allow inflation. If the Feds want to stop inflation they'll raise the rates (like they did a year ago or more). Stagflation is series because neither fiscal or monatary policy will work and could hurt.

 

jom

[BillJones]

The last time the Canadian dollar was equal to the U.S. dollar, was around 1965. I was in high school at the time.

 

As for whether it's a good thing or a bad thing, it all depends upon what you would like to do. If you want imported goods, if you want to by a foreign car or you wish to travel to Canada, Europe or Asia, it's going to cost you more in U.S. dollars. BUT if you run a company that exports U.S. goods, you now have an advantage because you can sell your goods are lower prices relative to the foreign currencies. If you are an American worker who is employed by one of these companies, your job should be more secure.

 

Back during the Great Depression, Franklin Roosevelt and his advisors would have loved this situation because it would have boosted U.S. employment. The Gold Surrender Order and the artificial fixing of the gold price at $35 an ounce was method of devaluing the dollar and making U.S. exports more attractive. Formerly the gold price for the U.S. dollar had been about $20.50 per ounce.

 

[EZ_E]

the Fed's response was three days of increasing the money supply in order to stabilize the dollar against the Euro and other currencies

 

Nowadays, there are all sorts of convoluted definitions for inflation. Yet, in most all pre 1960's dictionaries, the definition is simply an increase in money supply. So, bottom line, there is too much fiat money in circulation.

[chinook]

Excellant!!!

 

We can sell the US to the world then buy it back in 10 years on the cheap. Just like we did to the Japanese in 1990.