Canadian Dollar Reaches Parity with US$

boxlight writes in to mark the occasion when the Canadian dollar hit parity with the US dollar for the first time in 31 years. The article notes that Canada has run a budget surplus in each of the last 10 years. "This is actually bad for the profits of Canadian corporations that sell their products to the US for US dollars (Canada sells far more to the US that the US sells to Canada); but it means us Canucks will get cheaper Macs as the Canadian prices get closer to US prices with every new release."

Re:Article is useless without a graph!

[jamie]

http://finance.google.com/finance?q=CADUSD [google.com]

Re:Article is useless without a graph!

[mrslacker]

Only 120 days, but:

http://www.x-rates.com/d/USD/CAD/graph120.html [x-rates.com]

Re:Article is useless without a graph!

[CastrTroy]

Ask and ye shall Receive. Here's the link to the graph and data on Yahoo Finance [yahoo.com]. As of my posting, it appears that the US dollar has bounced back a bit, and is worth 1.0095 Canadian dollars.

This has been going on near the border for years

[Enlarged to Show Tex]

Various establishments (hotels, restaurants, etc) have been taking CAD at par for many years, although most of them stopped doing so once 1 CAD dropped below 0.75 USD (and there have been times in the past 10-12 years where it was as long as 0.59 USD/CAD. The only difference now is that soon those establishments that take CAD at par will start making money from the forex conversion instead of losing it... Also, here in Minnesota, Canadian coins have always been easy to spend as if they were US coins...

Re:Article is useless without a graph!

[jessiej]

or, just as accurate with a different twist http://finance.google.com/finance?q=USDCAD [google.com]

Re:Benefits to a cheaper dollar

[pnewhook]

It discourages foreign workers from sneaking into the US. Getting $4.00 an hour is suddenly not so much compared to what they get paid in their home country.

Yes. $4 per hour in Canada would be illegal. The lowest allowable minimum wage in Canada is $7, and it is typically around $8 depending on what provincve you live in.

Re:Benefits to a cheaper dollar

[Nexx]

Unless the relative buying power of 1USD = 1MXN, that statement's meaningless without comparisons to previous exchange rates.

Re:Benefits to a cheaper dollar

[Seumas]

Huh? How are these good?

* American products become cheaper to foreign markets. This helps with the trade imbalances we currently have.

American products are cheaper. American employees paid less or offshored.

* Foreign products become more expensive to American consumers, also helping with trade deficits.

Most products sold to American consumers are foriegn products. American employees being paid less because of the first point above also have more difficulty affording most products they buy, because of the second point.

* It discourages foreign workers from sneaking into the US. Getting $4.00 an hour is suddenly not so much compared to what they get paid in their home country.

Doesn't matter, because we don't need them to come to America. We can just oursource and offshore to them in their own country.

Freefall....

[downix]

I find it funny how it is always put "the Euro rsing against the dollar" or "the Canadian dollar rises against the US dollar" when the truth is the US dollar is in freefall, loosing value hand over fist. I wonder how long before the Peso overtakes us?

Re:Article is useless without a graph!

[Anonymous Coward]

This graph might be a little more useful, as it goes back 30+ years:

http://www.cbc.ca/news/background/economy/loonie.html [www.cbc.ca]

CDN book prices are a rip-off

[diodeus]

I grilled my local independent bookseller on this. She blamed the publishers, which are all in the U.S.

Complain about it here: http://www.competitionbureau.gc.ca/ [competitionbureau.gc.ca]

Re:Article is useless without a graph!

[donutello]

The USD is plummeting because of the trade deficit, not the budget deficit.

Re:what to do with "Canadian dollar jokes"?

[king-manic]

Happy belated 375th birthday then.

And in response to the GP, we'll be thankfull that we've used up our oil and they no longer need to invade once the resource wars really flare up.

The middle east has a 40 year deadline. Canada has a reserve estimated to last 350+ years at current usage increase patterns.

Re:About time

[ashitaka]

Actually the Chapters here in Vancouver has had a sign up for a while that stated the true Canadian price would be given at the till. Maybe they've even started putting price stickers on the books.

1864 the greenback traded at less than 36 cents

[JamJam]

What goes up usually comes down. Here's a little history: The Canadian dollar has seen some steep ebbs and flows in its history. In 1864, the greenback traded at less than 36 cents (Canadian), an all-time low for the U.S. currency. In 2002, by contrast, the loonie traded as low as 62 cents Quoted from http://www.reportonbusiness.com/servlet/story/RTGAM.20070920.wdollar0920/BNStory/robNews/home [reportonbusiness.com]

Re:Benefits to a cheaper dollar

[dcavens]

Someday, countries like Canada with lots of wheat will want something besides debt instruments in exchange for their goods. So too will countries like Saudi Arabia want something of tangible value in exchange for their oil.

Actually, Canada exports more oil and gas products to the U.S. than Saudi Arabia. We're your number one source for oil imports [doe.gov], which is one reason our dollar is so strong.

Re:Freefall....

[Rufty]

In terms of being used as a payment for cross-border transactions, the euro is trailing the dollar only slightly with 39 percent to 43 percent. [iht.com]

Re:Book Prices?

[HungWeiLo]

The storekeepers in Bellingham say that the expected surge of Canadian dollars has been subdued thus far, due to the fact that Canadians loathe the long lines at the border. 2 hrs or more of waiting during peak times plus over-inquisitive border patrol agents tend to drive away business.

Re:fiat money sucks

[servognome]

Now if only we had a gold standard again....

The US would have been bankrupt decades ago, and there would have never been near the same level of economic growth. The gold standard doesn't prevent economic mismanagement.

Re:Article is useless without a graph!

[rumblin'rabbit]

It takes months - even years - for price changes to move through the system. The goods that retailers are selling you now may have been bought by them a year ago. Many Canadian manufacturers have long-term contracts - priced in loonies - for basic feedstock.

Food and electronic goods from the U.S. should, of course, reduce in price quicker, but it can still take many months.

Re:Article is useless without a graph!

[2short]

"Printing money" (by which I assume you mean expanding the money supply) does not cover the budget deficit, as the government does not get the money. It is widely understood to encourage inflation, though it is not itself inflation as your "i.e." would imply. We borrow money to cover the budget deficit, not print it.

The trade deficit is a big problem, with complex, hard to summarize causes.

The budget deficit (and resulting national debt) is a big problem, with straight a forward, easily summarized cause: the election of idiots, particularly the last 3 Republican ones.

Re:Article is useless without a graph!

[mstahl]

Were you thinking of non-parallel skewed lines? These would be lines which are not parallel because the perpendicular distance between them is variant over their length, but which are not coplanar, and I believe must be members of parallel planes, so necessarily do not intersect.

Two lines can't really be colinear without being the same line. Not in euclidean geometry anyway (and actually, now that I think of it, not in more exotic geometrical systems either).

If two lines describe the same set of points, though, and you're calling them two separate lines, they would necessarily also be parallel even as they intersect one another throughout their entire length. Consider a definition of "parallel" meaning the perpendicular distance between the two lines is constant throughout their length.

I really hope I don't get modded (-1, Pedantic) for this one....

Re:cheaper Macs

[Emetophobe]

Try this Ipod Nano at future shop 219$ (or BestBuy.ca)

Same Ipod nano at BestBuy.com at 149$

I'm surprised no one else noticed this mistake, but you're comparing an 8GB ipod nano on those Canadian websites to a 4GB ipod nano on the American website.

Here's a correct comparison:

Bestbuy.ca 4GB ipod nano [bestbuy.ca]: $169.99 Canadian
Bestbuy.com 4GB ipod nano [bestbuy.com]: $149.99 American