[logicfirst]

Hey, I am wondering how many of you guys are planning to buy USD when it hits parity and beyond. I bought in at 0.91 and is planning to get in again around 1.08. The plan is too hold it until CND is worth 0.68.

For those who are keen in trading FOREX, what are your thoughts on the USD, is this weakness only tempoary, and where do you see the USD 12 months from now?

 

[el oro]

Imo, that is amongst the worst investments you can make at the moment. My advice would be to cut your losses now and invest elsewhere.

If you insist on doing this, I suggest waiting until CDN:USD=1.15, which is my minimum target. You'll lose less money that way.

But hey, it worked last time! Maybe it will happen again.

 

[Brad911]

The last time the CDN$ hit parity was based on commodity strength. What we're seeing right now is USD weakness; that makes this situation much different.

I won't be hedging like I did last time around (using DTO-N), so at the moment I'm looking for an alternative hedge.

 

[Mockingbird]

Talking about USD, here's an article of interest from New York Post.

Dollar loses reserve status to yen & euro

 

[leslie]

What, exactly makes you think the Loonie will go to $0.68 ever again?

 

[bean438]

You can't predict currency. It doesnt matter anyway. As the USD falls prices remain the same in Canada anyway because of greedy people.
They have no problem raising prices when the CDN dollar falls.

 

[canadianbanks]

I don't think that the Canadian economy will do very well if we have CAD = USD for extended period of time, therefore I believe that our government will try to devalue our dollar along with the USD, sooner or later.

 

[bean438]

I am going to Vegas next week so i am happy with the CDn dollar. DO I care if it goes up next week, or down next week? Nope.

 

[WarrenC]

You can't predict currency. It doesnt matter anyway. As the USD falls prices remain the same in Canada anyway because of greedy people.
They have no problem raising prices when the CDN dollar falls.

Not so true. CDN prices were approximately 20% higher (including exchange) compared to the USD. When the C$ went above the US about a year ago, this put huge pressure on Cdn retailers, and they responded.

Now Cdn prices are around 6% higher. We can't expect it to get much closer based on the relative sizes of the markets.

This was all from a financial analyst on talk radio, but it sounds reasonable. I live in Vancouver, so retailers really feel the pinch when consumers can just drive across the border for cheaper goods and services.

Using gas as an example, I did some analysis with a friend who lives in Seattle. The entire price disparity between gas in Vancouver and Seattle is explained by taxes and the currency exchange. Gas is not inherently "more expensive" here. So, there you go...

 

[OhGreatGuru]

The Chinese government has also stopped propping up the US dollar. They are buying equity in companies around in the world instead of US Treasury bills. See article in today's Ottawa Citizen by Diane Francis:

http://www.ottawacitizen.com/news/giant+starting+wake+strength/2104782/story.html

 

[el oro]

I don't think that the Canadian economy will do very well if we have CAD = USD for extended period of time, therefore I believe that our government will try to devalue our dollar along with the USD, sooner or later.

All governments will be pressured by their countries exporters to devalue their currencies. The problem is that it's harder for smaller economies like ours to do.

 

[MPrime]

There are reasons for the CDN dollar to go up. If we simply compare the real estate market along with the mining/commodity market Canada is a much more good looking place to invest in than US. China especially is seeking bigger prospects and deals with Canada, no doubt about that. That tyrant needs all the oil and gas it can get its hands on, though it seems Russia is right there with everything they need. However, they're still highly interested in investing in our oil companies.
We've got to give credit to out banking system for the stability that they do provide unlike the small private banks in the US. There is certainly something we are doing right, so there you have it, out dollar going off to the races.

 

[Berubeland]

Our whole economy is based on Canada having a dollar lower than the US dollar.

The US happens to be our biggest trading partner and so when our $ goes up US spending goes down because our prices become too expensive.

I have often thought that Canada should do more to diversify the countries we do business with. Like a company with one customer that is a large risk too large in my opinion.