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The Almighty Buck Businesses

Canadian Dollar Reaches Parity with US$ 702

Posted by kdawson
from the who's-loony-now-eh dept.
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."
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Canadian Dollar Reaches Parity with US$

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  • by A beautiful mind (821714) on Thursday September 20, 2007 @12:09PM (#20682119)
    Anyone got a graph handy that shows how the two dollars reached parity?
    • So I guess the original article wasn't in USA Today if there wasn't a graph.
    • by BadAnalogyGuy (945258) <BadAnalogyGuy@gmail.com> on Thursday September 20, 2007 @12:14PM (#20682195)
      A lot of people don't have graphs and Iraq such as and.
    • Re: (Score:2, Informative)

      by mrslacker (1122161)
      Only 120 days, but:

      http://www.x-rates.com/d/USD/CAD/graph120.html [x-rates.com]
    • by CastrTroy (595695) on Thursday September 20, 2007 @12:17PM (#20682265) Homepage
      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.
    • by eln (21727) * on Thursday September 20, 2007 @12:17PM (#20682267) Homepage
      Imagine a graph with two lines. Now imagine those two lines converging until they meet.
    • by kebes (861706) on Thursday September 20, 2007 @12:22PM (#20682349) Journal
      Here's a graph [yahoo.com].However it doesn't show parity because different markets trade at slightly different values, as explained in this news item [www.cbc.ca]:

      "Currency trading is an over-the-counter market," a Bank of Canada spokesperson told CBCNews.ca. "It's not like the TSX." So there can be small discrepancies depending on the trades the data source monitors.
      However that article mentions that "The loonie briefly reached $1.0003 US on foreign exchange markets shortly before 11 a.m. ET, the Bank of Canada said." and TFA says "The Canadian dollar reached $1.0002, before retreating to trade at 99.93 U.S. cents at 11:01 a.m. in New York." So that narrows down the approximate moment when parity was reached.

      At present it's just below parity (0.9986), but the expectation is for the Canadian dollar to exceed the US dollar in the near future.
    • In order to see anything useful, you should also plot the Euro and the Yen. While the CAD has increased slightly in buying power in recent years, the bigger news is that the USD has plummeted, likely due to bad fiscal policy (war debt).
      • Re: (Score:3, Informative)

        by donutello (88309)
        The USD is plummeting because of the trade deficit, not the budget deficit.
        • by QRDeNameland (873957) on Thursday September 20, 2007 @02:52PM (#20685603)

          In response to both your post and your sig, this really is obligatory:


          Singer: The trading gap shuffle, we're in a heap of trouble, doing the trading gap shuffle!
          Bart: He already sang this song!
          Marge: No, that was about the budget gap. This is the trading gap.

      • by xs650 (741277) on Thursday September 20, 2007 @01:14PM (#20683429)
        "In order to see anything useful, you should also plot the Euro and the Yen. While the CAD has increased slightly in buying power in recent years, the bigger news is that the USD has plummeted, likely due to bad fiscal policy (war debt)."

        Yes indeed. My first thought was that the title should have read "US dollar reaches parity with Canadian dollar."
  • by peter303 (12292) on Thursday September 20, 2007 @12:10PM (#20682137)
    Answer: Change them to "American dollar jokes"
    • Re: (Score:2, Funny)

      by Tackhead (54550)
      > Answer: Change them to "American dollar jokes"

      Hey, didn't you mean "Change them to 'American dollar jokes', eh?", you hoser?

      So, anyways, today will be a day long remembered, eh? It has seen the end of the the US Dollar, it will soon see the end of the Empire, eh?

    • by ArcherB (796902) *

      Answer: Change them to "American dollar jokes"
      Yeah, but then you wouldn't get as much out of it.

    • by fm6 (162816) on Thursday September 20, 2007 @12:49PM (#20682897) Homepage Journal
      Offtopic: had a friend once who thought that there were penguins in Canada. When I disabused her of that notion, she said, "there go all my Canadian thanksgiving jokes."
  • by Anonymous Coward
    Our economy is strong, and always growing. At least that's what the preznut keeps telling me.

    Three jobs! Uniquely American, isn't it.
    • Re: (Score:3, Insightful)

      by ArcherB (796902) *
      Our economy is strong, and always growing. At least that's what the preznut keeps telling me.

      Actually, it is the economists that keep saying it. They get their data from economic indicators such as the stock market, GDP, inflation rate, consumer confidence, unemployment etc. The President just repeats it.

      Of course, since it does not jive with your politically colored glasses, I don't expect you to understand.

  • by MLopat (848735) on Thursday September 20, 2007 @12:13PM (#20682179) Homepage

    "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."

    Somehow that seems like little comfort for us Canadians that realize the impact this has overall on our economy. Anyone that isn't into business or economics up here gets excited about the CDN dollar being stronger because it translates into better cross border shopping for a very small minority, cheaper vacations, and some discounted consumer items like Macs. But take a look at how this impacts the country as a whole and we don't have much to celebrate as an exporting nation.
    • we don't have much to celebrate as an exporting nation.

      Hockey, Beer and Maple Syrup! What's not to celebrate?
    • by pokerdad (1124121) on Thursday September 20, 2007 @12:25PM (#20682403)

      we don't have much to celebrate as an exporting nation.

      Our economy is stronger than it has been in my entire life. At .70 US, .80 US and .90 US there were people predicting the imminent collapse of the economy, but as a whole it has just gotten stronger.

      And while we may export resources, we largely import manufactured goods, so for some one looking to buy just about anything, this is good news.

      Its also worth noting that while the loonie has gotten a little stronger, this is largely a story of the US dollar weakening and the Canadian dollar not following (as it has often done in the past). This means that the price of Canadian goods have not increased globally, leaving plenty of opportunity to sell to other markets.

    • by king-manic (409855) on Thursday September 20, 2007 @12:28PM (#20682475)

      Somehow that seems like little comfort for us Canadians that realize the impact this has overall on our economy. Anyone that isn't into business or economics up here gets excited about the CDN dollar being stronger because it translates into better cross border shopping for a very small minority, cheaper vacations, and some discounted consumer items like Macs. But take a look at how this impacts the country as a whole and we don't have much to celebrate as an exporting nation.


      Dont' over estimate the crunch on our export industry. A significant amount is via oil which is a commodity that does not reduce in demand linearly with price. Manufacturing etc... has been on a steady decline for the last 8 years as well as the dollar rose. That has hurt the eastern Ontario economy. At the same time sky high oil prices and an increase in demand world wide has lead to a super heated economy in the west. The west gains from this as our commodity is in demand and we are at capacity to provide. so a Price increase helps the western provinces while it hurts the eastern provinces. Our trade with the US is immense but it hasn't ever been about selling them large quantities of manufactured goods. There is also a time lag related to the effects as contracts signed when the dollar was weaker will remain for a while. So it'll be a while before we see how parity helps or hinder us. As a westerner I don't mind a big crunch in the eastern economic power block.
    • Re: (Score:3, Insightful)

      by Cedric Tsui (890887)
      Not at all. To our economist's surprise, the Canadian export economy is coping with the rapidly rising dollar very well. One theory is that the dollar has been rising for such a long time that all the weaker companies have already been weeded out. Canadian organizations are using the high dollar as an opportunity to purchase equipment from the states to make themselves more competitive.

      In fact, Canadian economists were also VERY worried about the impact of the American housing market collapse on our economy
    • by Kristoph (242780) on Thursday September 20, 2007 @12:51PM (#20682945)
      Actually the value of the CAD has as much to do with the fact that Canada is an exporting nation as anything else. The CAD hit bottom against the USD in 2002 and has been climbing ever since almost in lock step with the rise in value of the commodities it exports. The continued fall of the USD will likelly push commodities higher and so companies exporting commodities will not feel a great impact. That, in turn, should prompt more foreign investment in comodity producers which (directly and through a knock on effect) will increase the number of Canadian jobs.

      To be sure, the impact on the Canadian economy from the downturn in the US housing and car markets is going to cost jobs but that has less to do with the dollar then it does with the weakness in those markets in the US.

      ]{
    • Re: (Score:3, Insightful)

      by swordgeek (112599)
      All true, but two things need to be remembered.
      First of all, our primary exports are raw materials, not finished goods. As a resource exporter, countries can't afford _not_ to buy our products. They can't in-source the mining of bauxite, for instance, if they don't have the stuff.
      Secondly, this is a measure of the US dollar sinking. Canada has grown modestly against other currencies: ~22% against the pound, ~15% vs. the Euro, and a rather large ~46% against the Yen, in just under five years. Those aren't da
  • by ArcherB (796902) * on Thursday September 20, 2007 @12:16PM (#20682229) Journal
    People assume that the dollar falling in value in relation to foreign currency is a bad thing. This is not necessarily the case. Here are some benefits:
    * American products become cheaper to foreign markets. This helps with the trade imbalances we currently have.
    * Foreign products become more expensive to American consumers, also helping with trade deficits.
    * 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.

    I could go on, but you get the idea.
    • Re: (Score:3, Informative)

      by pnewhook (788591)

      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.

    • by benzapp (464105) on Thursday September 20, 2007 @12:25PM (#20682419)
      The problem is we have no native industry for the vast majority of things Americans desire. We also are a net importer of food and energy.

      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.

      Rapidly rising prices of foreign goods may someday bring back American industry, but that is a generation away. We have too few engineers and no manufacturing infrastructure. We will have to train a whole new class of workers and build many new factories. This doesn't happen overnight.

      • Re: (Score:3, Interesting)

        by Jeff DeMaagd (2015)
        We have too few engineers and no manufacturing infrastructure. We will have to train a whole new class of workers and build many new factories. This doesn't happen overnight.

        I think you vastly underestimate the existing base. Part of the reason that there are fewer people in manufacturing in the US is because US manufacturing increased in productivity. People that spent a lifetime as high school grads doing rote tasks were obsoleted by robots. Manual machinists were replaced by fewer people that operate
    • by Znork (31774) on Thursday September 20, 2007 @12:50PM (#20682915)
      Oh, true, there are many advantages to currency fluctuations. For the US in this case I think it's a bit more painful than usual tho.

      The declining dollar will drive a sharp inflationary pressure, which severely limits the Feds ability to moderate the economy. The Fed might want to lower interest rates, but every lowering will result in a rapid inflationary hike, leaving it with the choice of either letting property prices collapse with associated pain of bank runs and failures, or by letting the dollar continue in free fall which means letting everyone holding US assets pay for the irresponsible behaviour of some.

      And of course, if the Fed shows it's going to let the dollar tank, that'll just cause everyone to dump even more dollar assets, driving the dollar down further.

      Long term there will be a correction, and there will be advantages such as a resolution to the trade imbalances. But the fundamental problem is that large parts of the next decades consumption has already been done, paid for by borrowed money secured with overinflated real-estate prices. Adjusting to paying interest rather than shopping luxuries will suck badly.

      On the bright side, perhaps the economists will bang their little heads together hard enough this time to come up with numbers for GDP growth and asset values that are actually based in reality.
    • Re: (Score:3, Insightful)

      by photomonkey (987563)

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

      What is it that we produce again, beyond credit products and consulting. I'm talking in the range of consumer or industrial products.

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

      ...But at the same time further weakens the American economy. We cannot, under the present economy, 'make' stuff as cheap as other countries (China, Slovenia, Turkey, etc.) can. Computers are 'cheap' in the US now because Chinese workers assemble the PCBs for literally dollars a day, where we can more adequately measure skilled labor costs in dollars per hour.

      So by t

  • by Dzimas (547818) on Thursday September 20, 2007 @12:17PM (#20682257)
    Another way of looking at this is that the US dollar is in freefall against the Euro and other major currencies. The shift between the US and Canadian dollars reflects this new reality. That said, I suspect Forex traders are caught up in the euphoria of parity. The Canadian dollar might well dip significantly below $1 American again as the rush of breathless media attention dries up and currency traders take their profits and run. This certainly isn't good news for Canadian manufacturers - I run a little electronics company that sells 90% of our goods in the USA. We have raised some prices by as much as 30% over the past five years, just to maintain margins. However, our customers don't necessarily see it that way - they think we're getting greedy. To keep things from getting out of hand, we've moved some production to China and started to source North American components in the USA, rather than dealing with Canadian distributors. That's not good news for our economy.
    • Re: (Score:3, Interesting)

      by king-manic (409855)
      Another way of looking at this is that the US dollar is in freefall against the Euro and other major currencies. The shift between the US and Canadian dollars reflects this new reality. That said, I suspect Forex traders are caught up in the euphoria of parity. The Canadian dollar might well dip significantly below $1 American again as the rush of breathless media attention dries up and currency traders take their profits and run. This certainly isn't good news for Canadian manufacturers - I run a little el
  • Book Prices? (Score:5, Insightful)

    by senor_burt (515819) on Thursday September 20, 2007 @12:19PM (#20682299)
    Can the book publishers start to change their book prices, then? It made sense before when they priced them out relative to currency, but at this point, to spend $32 CDN versus $21 USD for the same book, well, as far as I'm concerned, Canadian book vendors are going to go out of business as I start to buy more from Amazon.com rather than Amazon.ca - and Amazon.com frequently offers free shipping.
  • In other news, Apple stock soared on the account that Canadians only spend their dollars on Macs!
  • Meanwhile, for instance, a Honda Goldwing is US$20'000 and CAD$30'000, same thing for almost all cars, especially sports car like the WRX STi or others...

    It's time we all go shopping in USA, I live in Montréal so I am 45 minutes from NY state and often go to Plattsburgh or even Burlington in VT, just to buy stuff sometimes 60% cheaper than here.
  • it wont be long until the US Dollar reaches parity with the Mexican peso...
  • Freefall.... (Score:5, Informative)

    by downix (84795) on Thursday September 20, 2007 @12:31PM (#20682525) Homepage
    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?
  • by saterdaies (842986) on Thursday September 20, 2007 @12:34PM (#20682591)
    It isn't necessarily bad for Canadian corporations. When something like this happens, it changes things. Canadian companies now get less money for final goods and services provided to Americans because of the exchange rate. BUT, Canadian companies can get intermediate things for cheaper. So, let's say that Bombardier (a Canadian train/plane manufacturer) buys components (like Aluminum) from the US. They get that cheaper. Then they sell that plane to the US which they earn less money for. That comes out as a wash. It really just shifts income from those who export to those who import. But in the long run, it doesn't even change that. As the demand for American goods in Canada rises, the price level of American goods will rise and along with it the currency. Things in economics tend toward equilibrium in the long run.
  • cheaper Macs (Score:5, Interesting)

    by denisbergeron (197036) <`DenisBergeron' `at' `yahoo.com'> on Thursday September 20, 2007 @12:47PM (#20682869)
    Not at all !

    Goods are allways at higher price in Canada.

    Look at cars, even if no border tax exist for foreing company to import car in Canada (or in the USA) all car have better price and better warrenty in the USA than in Canada. Go to jeep.ca or toyota.ca and try to build a car and then compare it with jeep.com ou toyota.com for a 30k car in the USA you will buy 36K in Canada (plus taxes).
    Samething for everything from Apple, you got 10% to 30% of foreing charge when you buy in Canada.

    And don't try to buy it at Amazon.com, they don't send thing like that in Canada, you must buy at Amazon.ca.

    Try this Ipod Nano at future shop [futureshop.ca] 219$ (or BestBuy.ca) [bestbuy.ca]

    Same Ipod nano at BestBuy.com [bestbuy.com] at 149$

    Even if the Can$ is higger thant the US$ price a cheapper in USA, That's before taxes, and the overall business etablishment price is lower in Canada.

    • Re: (Score:3, Informative)

      by Emetophobe (878584)

      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

  • by fm6 (162816) on Thursday September 20, 2007 @12:52PM (#20682969) Homepage Journal
    Anybody else think it's ironic that at a time when people are resisting government run health care because of the expense, the Canadians are running a budget surplus — despite have government run health care?
    • by man_ls (248470) on Thursday September 20, 2007 @01:25PM (#20683667)
      Their military budget is a joke when compared to ours. That's why they're able to run a surplus -- it's not being spent on defense.

      Whether that's a good thing or not is a matter of opinion, but their lack of a military being the reason they can be more socialized is a matter of fact.
      • Re: (Score:3, Funny)

        by pcgc1xn (922943)
        The US is spending money on defense? Oh yeah, forward defense.
      • by ShieldWolf (20476) <jeffrankine@NOsPAm.netscape.net> on Thursday September 20, 2007 @01:57PM (#20684439)
        It depends what you mean by a 'joke'. :P

        The US spends more on its military than the rest of the world COMBINED. As a matter of percentage of GDP the Canadian government spends less than other NATO members on average, but we spend more than Israel does in dollar terms (bet you wouldn't have guessed that one).

        Truth is Canada spends less on our military because WE DON'T HAVE TO. With the cold war over there is no immediate threat to our country. Unlike the US we don't try to project our national policies externally for the most part so we don't need 12 nuclear powered aircraft carriers etc.

        Having said that to address your main point this is not the reason why we have a budget surplus. Canada used to have a small military AND a budget deficit because we had lots of wasted spending on social programs and not enough revenue. We increased some taxes and ALSO cut spending and now everything is golden (similar to the state of affairs in the US in the late 90s). That you guys blew the opportunity to be in a smiliar situation by massively cutting taxes and increasing discretionary spending is your own fault, don't blame it on military expenditures.
      • Re: (Score:3, Interesting)

        by fm6 (162816)
        Well, you do have a good point. On the other hand, do we really need as big a military as we have? Right now, we could fight a conventional big-battlefield war with the rest of the planet, and probably win.

        Except there aren't going to be any more CBBWs. Just nasty little quagmires like Iraq. And maybe the odd terrorist attack or nuclear exchange. Having a huge military is not all that useful for that.
      • by A beautiful mind (821714) on Thursday September 20, 2007 @05:06PM (#20687963)
        The US spends the highest percentage in the world of it's GDP on healthcare. I don't think military expenses or not has anything to do with it.
    • Re: (Score:3, Interesting)

      by ceoyoyo (59147)
      You can use more direct numbers than that. Most (or all?) of the Western world pays less for universal government health care than the US does for it's private system and get better quality care to boot.
  • by nate nice (672391) on Thursday September 20, 2007 @12:55PM (#20683035) Journal
    Our beloved, once great country (the USA) is in serious financial trouble. China has been acquiring dollars for awhile now with the trade surplus they've had with the USA for some time. Usually this isn't a problem as the trading country reinvests these dollars into the USA's markets and businesses. This is good for the USA as you can imagine. In theory it should also raise the value of the trading countries currency because their GNP should be higher. But imagine the trading country keeps its currency artificially low so it can export things cheaper and cheaper and acquire more money (dollars) faster to build more and more factories, etc. It does this by sending the dollars back to the USA in the form of treasury bonds.

    Now imagine the USA expected a surplus and made a huge tax cut because of it. And then the surplus never happened so a huge debt was created. Someone has to pay this debt off. Imagine if the people paying this debt off are the ones you are running a trade deficit with. Hence, our trading partner buys treasury bonds at an alarming rate.

    This works great for the USA short term because we get cheap goods from China (because their currency is still of low value because they invest their profits right away) and save a little bit on taxes. Well, a lot if you're rich.

    But as you're probably starting to realize, this can't go on forever. Eventually it's going to collapse. At some point the debts will have to be paid and this will be done by raising taxes and INTEREST RATES. So now not only is the dollar worth less because everyone has a ton of them around the world, but it costs a ton to borrow them so no one wants them.

    All of a sudden the value of your house is half of what it was, the value of your paycheck is half, etc. A domino effect is created because no one can afford to borrow money any longer. American business doesn't take risks, people can't take risks, and money is tight. We haven't experienced this in a long time. Money has been cheap. It's been the USA's biggest seller. The dollar was valuable and it was available. That's prosperity. Imagine the dollar being expensive and worthless. That's a depression.

    So expect the Canadian dollar to become more and more valuable against the USA dollar for awhile.
  • by JamJam (785046) on Thursday September 20, 2007 @01:17PM (#20683487)
    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]
  • by cdn-programmer (468978) <terr@terr a l o g i c .net> on Thursday September 20, 2007 @02:32PM (#20685155)
    I am not at all surprised to see parity. Canada has a strong economy and Alberta especially so.

    There are many reasons for weakeness in the US currency including but not limited to a massive government debt and a glutonous appetite for foreign oil.

    Yesterday T. Boone Pickens was on TV on the business channel I sometimes watch. He made a number of interesting comments:

    1) World oil production is about 85 million barrels per day and T. Boone does Not think it can be increased. The best information I have comes from expertize within the Geological Survey of Canada, but this expertise is certainly not limited to the GSC, and we are now pegging the peak of work oil production at September 2006. If production increases above that level then it will not be by much. T. Boone commented that the estimated demand for 4th quarter 2007 is 88 million Barrels per day.

    Hence we will see the oil price driven up in order to destroy demand. In all likelihood it will get worse.

    2) T. Boone says he favours nuclear and pointed out that General Electric says they can build a reactor in 3 years plus the friction added by the regulators and dealing with opposition. Probably this is correct.

    3) Canada is ramping up Tar Sands as fast as we possibly can which explains why our economy is so strong. We cannot increase production has enough to make much of a difference. Currently we are investing billions per year.

    Currently the USA consumes about 23 million barrels of oil per day.

    Any way you want to slice it - this is not good news. It is clear the US dollar will continue to weaken is decades of political scrapping and decades of economic mismanagement finally face their day of reconning. As has been said many times, in order to avoid the melt down of our economies due to lack of energy availablity and high cost, we have to build at break neck speed an infrastructure that can replace oil and gas. We needed to start about 15 years before the peak of world oil production. We have not done so.

    If the peak really was last year, then all hell is about to unfold and it will not surpise me to see gas rationing in the not too distant future.

    Some things to remember.

    Ethanol will not solve the problem. 100% of the US corn production will provide less than 2 weeks of liquid fuel. Next, ethanol from any source lives by the equation that 1 tonne of dry plant mass yields the equivalent of about 2 barrels of oil and this if we can do the conversion for free. This includes cellulostic ethanol.

    We don't have the plants build anyways.

    Industry runs under much tighter constraints than consumers. A consumer will simply give up a dinner at a restaurant in order to save the money to pay for his next tank of gas. Industry shuts down the plant and lays everyone off. We have already lost most of the North American fertilizer industry and plastic feedstock production (IE the pellets that go into injection moulding machines) is also going to die. Electricity production from Natural Gas is not threatened yet but expect power costs to continue to climb as this sector pushes out weaker sectors. In all cases jobs are lost and expensive infrastructure goes idle.

    If one looks at the mortgage crisis and factors in the job loses precipitated by energy issues, then it becomes clear that this picture is not yet well understood.

    Next consider how a government deals with recession? They print currency. Faced with the choice of inflation or recession, which do you choose? People on fixed incomes will lose their retirement.

    Of course - one way to look at this is that its the retiring generation that lived beyond their means and created the mess. Their children certainly didn't. So maybe its poetic justice. However I do not think that people realize how bad its going to be. I watched my father-in-law lose his retirement because of the inflation Pierre Elliot (Idjot) Trudeau and his henchman Jean (Cretin) Chretien during the 1970's.

    In part this

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