Use access key #2 to skip to page content.

KDakotaFund (33.16)

Smart Money - O Canada: Are Loonie's Days of Dominance Over?

Recs

11

May 27, 2011 – Comments (7) | RELATED TICKERS: COSWF.PK , EWC , BNS

For anyone who remembers cut-rate vacations to Canada, the recent rise of the loonie against the dollar has been somewhat disorienting. But recent currency moves suggest the Canadian dollar's days of dominance may be numbered. Is it time to pack the car and head north?

For the past eight months, the Canadian dollar has been rising against the dollar to a peak of $1.06 at the end of April up 5% this year alone, and up 36% from two years ago, when a Canadian dollar could be bought for a little more than 77 cents. But after oil prices and commodities fell last week, the Canadian dollar started to inch downward, to $1.03 as of Friday.

Full article

7 Comments – Post Your Own

#1) On May 27, 2011 at 2:21 PM, catoismymotor (78.36) wrote:

I have an uncle that resides outside of Toronto. I remember around 1980 he came back to the states, said the exchange rate was 0.64 Canadian to the US dollar. After my dad explained what that meant I was amazed at how that could be. That was my first exposure to the crazy world of exchange rates.

kdakota, have you seen an impact on your business as a result of your dollar going up?

What has kept me away from Canada as a vacation destination is not the weakened dollar/beefed up Canadian dollar. It is a combination of time, distance, Rick Moranis and disposable income. I'd would enjoy spending time traveling the country from PEI to Toronto. As much as I beat the libertarian drum I have to admit to harboring a fantasy about retiring to Nova Scotia.

Thanks for posting the article. BTW: I have two Canadian companies in my retirement account. By the end of the year I hope to add a third.

All the best,

Cateaux

Report this comment
#2) On May 27, 2011 at 2:52 PM, kdakota630 (99.92) wrote:

catoismymotor

I enjoyed the article myself, even though I don't agree with their assessment.  Overall I think Canada simply has too many things going for it that we'll lose much to the American dollar, short-term or long-term.  Obviously things can change, but that's my thinking at the moment.

I haven't had any real impact to my business.  Mostly I'm far enough away from the border for cross-border shopping to affect me much.  I might be losing some business to online but it hasn't affected my bottom line.  

Perhaps the better exchange has prevented an impact.  Extra demand for protein was supposed to have driven the price up, but the stronger dollar could be off-setting that.

As for Nova Scotia, I can't say much about it.  I was there when I was 16 and thought it was beautiful during the summer weeks I was there.  Lots of jellyfish washed up on the beaches didn't make for fun sunbathing.

One thing I will say is that Canada truly is a beautiful country and if you (or anyone else) have the time to sight-see, it can be one hell of a trip.  I haven't done enough of it myself, but I've been to all the maritime provinces, British Columbia, the Yukon and the Northwest Territories (the part now called Nunavut) and still know I've only scratched the surface and loved every minute of it.

For the record, even though I've never been, I've long-thought about retiring in Penticton, BC.

Report this comment
#3) On May 27, 2011 at 2:59 PM, Turfscape (38.29) wrote:

So, I can now afford more Tim Horton's donuts! Hooray! (disclosure: Long THI)

I do enjoy our northerly neighbor. Fascinating country. And if you're still looking for a cut-rate vacation, try Poland. It's kind of like Canada, but fewer Quebecois to deal with.

Report this comment
#4) On May 27, 2011 at 3:15 PM, catoismymotor (78.36) wrote:

Overall I think Canada simply has too many things going for it that we'll lose much to the American dollar, short-term or long-term.

I agree. I think a culture of ethical behavior, liberal immigration policies, a pro-business climate and vast natural resources are all in your favor. My gut feeling is the loonie will float around the 0.95 mark for the next decade. That may pose a headwind for some industries but in the end I think it will be a good thing for your side of the border.

 

Report this comment
#5) On May 27, 2011 at 3:20 PM, catoismymotor (78.36) wrote:

Hey, I'll take the Quebecois over the Parisians I've dealt with.

 

Report this comment
#6) On May 27, 2011 at 3:28 PM, kdakota630 (99.92) wrote:

Turfscape

I don't eat many donuts but their Boston Cream donuts are the absolute best.  Their coffee is addictive to the point that I think the drug it somehow, although I don't drink coffee either.  Timmy's is the Canadian cultural equivalent of beer, touques, hockey and back-bacon.

Never been to Poland but would love to go at some point.  Since I'm already in Canada though, it's cheaper for me to stay here.

catoismymotor

All the same stuff I had in mind, plus roughly the same prediction I had for our dollar, although I'd go as high as saying it'll float between a 5-10% premium over the USD.

Forgot to mention that I'd been to Alaska.  OK, that's not part of Canada, but that was on my trip to the Yukon and northern BC.  I was actually supposed to move to Whitehorse around 1980 but the economy there was hit pretty hard and my dad moved back before I had a chance to go.  He took me for a couple of weeks in 1985.

Report this comment
#7) On May 27, 2011 at 7:41 PM, ChrisGraley (99.67) wrote:

I agree that the Canadian economy has too much going for it right now and I can't see the price of oil doing anything but rising steadily in my lifetime.

Report this comment

Featured Broker Partners


Advertisement