Good news for travellers (I hope)

The Canuck buck has been trading at 95 cents US this morning.

Good news indeed if you are travelling or cross border shopping.
Terrible new if you are a Canadian manufacturer or have any connection to an industry that exports.

good news if you are traveling to the US, otherwise it's meaningless.

Our dollar isn't getting stronger - the US dollar is getting weaker. Other than allowing Canadians to drive down south to buy cheap goods at Walmart it is generally a negative thing for most of the country.

I loonie buys 1.12 ozzy dollars. Im assuming most of Canadas resource sector trades in the green back, so Jumping Jack Flash has a good point.

The Canadian dollar is the only major currency rising against the price of gold..... so go buy gold!

It totally sucks for those of us in the film business.

It sucks for me, being in manufaturing and all.
My job will go to Mexico or China within the next few years.

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<hr>Our dollar isn't getting stronger - the US dollar is getting weaker<hr></blockquote>

That would explain why the Can $ is appreciating against every other major currency. I guess.

Who cares shortsail? The position of the Canuckbuck vs $US is pretty much the only relationship that matters for Canadian jobs.

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<hr>for Canadian jobs. <hr></blockquote>

Make that "for some Canadian jobs".

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<hr>Who cares <hr></blockquote>

Canadians should care. An economy predicated on a weak currency is an inefficient economy.

tell it to the many Ontarians who are unemployed or about to be

How about telling it to all the health authorities across the country who now have a much more competitive work environment. Manufacturing is so 20th century. Get with it.

Lemme see, the countries that have done very well in the last half century are manufacturers.......Germany, Japan, USA.... more recently China , India, Korea.... all done on making things, not call centers......

Are you seriously contending that the number of health sector jobs drives our economy?

An economy predicated on McService jobs or inefficient government makework is in very deep shit.

And none of the countries you mention, except China and Japan, did it by subsidizing their manufacturing on the backs of their own consumers. If a company can't be competitive by innovation, efficiency, superior quality, etc. then they are best left to the dust pile of history. Chrysler, GM and Ford being excellent examples. A strong currency is one indicator of a healthy economy.Strong Canadian companies are now taking advantage of the dollar and expanding abroad, and that's good for Canada.

Obviously somebody is a civil servant.

The closest I've ever come to working for any govt. was in my youth when they were silly enough to pay me UI. And I actually create very well paying jobs TP, what do you do?

The health authorities are not much more competative with the strengthing dollar, it is helping but the two largest reasons why there is the inequality is taxation and the actual rates of pay being offered.
How is a stronger dollar helping Canadian companies expanding abroad? If said companies are producing their products in Canada and selling them abroad, their products are becoming more expensive in the non-native countries and thus are not as competative or attractive to the market. If by expansion, you mean the companies are outsourcing their production to 'cheaper' countries, the Canadian workforce is losing jobs while the company makes more money. In this example the expanding companies will spend their new found wealth moving into new countries and thus not spending the money domestically, thus it is a double hit on the ecomony.
I believe in the open market but by no means is the strengthing Canadian dollar a benfeit to Canada based on how we have shaped our economy for the past 50 years. Was it the right decision to develope our economy based on the large buying power of our southern neighbour? It work for quite some time but the winds of change are blowing.

The strong CDN dollar is also affecting the fly-in fishing camp business in the northern half of Saskatchewan as they're not the cheap destination they once were to Americans.

Back when we had a "third world currency" (as some on this branch were calling it a few years ago) they were doing great.

tell it to the many Ontarians who are unemployed or about to be

If people in Ontario or anywhere else are worried about losing their jobs due to the rising C$ they can ask their employers for a pay cut.

A weak currency is an involuntary pay cut, and taxation of savings, for everyone.

Shortsail - hedging will definately help in the short term for those businesses that are large enough to have the excess capital to be afford to. What happens if the Cdn$ keeps raising though? The return offered from hedging will not cover the decreasing profits the company's receive abroad for their products.

I also am still curious as to how the strengthing Cdn$ is helping Cdn companies expand abroad that you mention in #13? (see #16)

Quite simple. One of the contributing factors in the strengthening of the Can $ is foreign companies realizing that Canada is a good economy to invest in, so they pour foreign capital into Canada by buying up Canadian companies with merit. The stronger dollar now enables Canadian companies to shop the world for good buys, thus strengthening their bottom lines and making themselves less vulnerable to takeover. It's part of the "creative destruction" that is one of the driving forces of capitalism. If a Canadian company isn't in play, one way or the other, it's a sign that the company may lack merit.

Oh and hedging can be done by the smallest of businesses, it's not an expensive strategy, and can be quite profitable. The idiots running the 2010 olympics forgot to do it and kissed goodbye to quite a few millions. Makes one wonder what else they've screwed up.

The foreign companies buying up the Canadian businesses is a one time cash injection into the system that does not benefit the Canadian economy as most of the foreign investment money and profits will not stay in Canada but go to the country where the headquarters are located. Oil companes in Alberta are a prime example, many of their profits head to Texas. But I will argue that they are generating employment but no more then when the companies were owned by Canadians. On its own the rising Cdn$ dollar should slow down the events of foreign investment as the Cdn companies will cost more. The time when the Cdn companies look most attractive for foreign investment is when the Cdn$ is falling and interest rates are increasing.

I am confused on your arguement that the rising Cdn$ will allow Canadian companies to look for investing opportunities. When the Canadian economy is primarily made up of manufactuirng companies that export to the US, the rising Cdn$ results in less profitability for the companies and thus less disposable income for them to finance operations abroad. The $ may stretch further but it doesn't help when they have less $'s to play with. Your arguement would work for large businesses that do not export currently as their cash flow will not be effected with currency fluctuations.

I agree that hedging isn't an expensive strategy except when the hedge does not work the way you are wanting it to (ex hedging on the thought that the currency will increase in value when it actualluy decreases). This event happening could be a very expensive strategy. No matter the size of the company, if they do not have excess cash hedging is not an option.

Canadian companies are on a rather large buying spree right now. Magna just took a run at Chrysler. Onyx is buying anything and everything. Alcan is buying in India and considering Alcoa. The list goes on and on. Most sentient people knew the dollar was in a long term uptrend two years ago. And a neutral hedge is just a minor business expense, another form of insurance.

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<hr>Cdn$ is falling and interest rates are increasing<hr></blockquote>

That scenario is somewhat unlikely. One of the reasons the dollar is rising is that foreigners are expecting an interest rate hike in Canada.

Alcan is buying Alcoa? I think you've got that backwards skipper
Magna has failed to buy Chrysler, and oh by the way why would you be hyping a company that is heavily dependent on the Big Three, companies you consigned the 'the dust pile of history" in post #13? Have they recovered somewhat in the last few hours?
As for 'Onyx' (assuming you mean Onex), wouldn't they buy heavily abroad instead of here? How does that help Canadian exports??

I think you may have missed the "pac man" defense being contemplated by Alcan. The fact that Magna failed doesn't alter the fact that they are flush with cash and on the prowl, a well run operation that aren't whining about the Canadian $. They would have rebuilt Chrysler as a modern company not the dinosaur it is now. Onex is one of Canada's most succesful companies, it's a power house with operations around the world including Canada, all managed from Canada.

The more expertise Canada exports the better for Canada. Why are you so hung-up on making wigets and forcing Canadians to subsidize the operation.

Alcan can comtemplate all they like, if the share price offered by Alcoa is decent, they will become yet another Canadian subsidiary. They'll throw a few jobs at Quebec of course, de rigeur in these things.
I'm hung up on making widgets because that requires capital investment and often creates long term , quality jobs. In Canada, not Indonesia or India or China. Investment by foreign or Canadian companies is much less likely with a canuckbuck at par. I don't want a call center or 'service' based economy, not entirely.That is why.

Magna would have rebuilt Chrysler? I think they reached the same conclusion you did in #13 about Chrysler, though you seem to be backtracking on that one. You could be right though, they do have that intellectual powerhouse Belinda Stronach just itching for a crack at making those billions do the hokey-pokey.

Onex is a workout business, they love to buy, strip and flip. And managing from Canada? If it is so jolly here for manufacturers and industrial giants why isn't Onex building here?

Buying nukes just got cheaper ;)