The USD is now the same value as the Canadian Dollar!

[MattT]

 

[Thin Lizzy]

Rank Country GDP (millions of USD)
— Gross world product 48,244,879
1 United States 13,201,819
2 Japan 4,340,133
3 Germany 2,906,681
4 China 2,668,071
5 United Kingdom 2,345,015
6 France 2,230,721
7 Italy 1,844,749
8 Canada 1,251,463

[MattT]

Rank Country GDP (millions of USD)
— Gross world product 48,244,879
1 United States 13,201,819
2 Japan 4,340,133
3 Germany 2,906,681
4 China 2,668,071
5 United Kingdom 2,345,015
6 France 2,230,721
7 Italy 1,844,749
8 Canada 1,251,463
.

I herd that the US owes China alot of money, so in reality China should be near the top.

[Cromespyder]

I herd that the US owes China alot of money, so in reality China should be near the top.

that makes no sense at all. china does own around a trillion US in our debt though. i read on google news that the canadian dollar will reach us1.05 soon.

[Thin Lizzy]

I herd that the US owes China alot of money, so in reality China should be near the top.

GDP is the dollar amount of goods and services produced by a country. Debt isn't part of the equation.

The drop in the value of the dollar actually has its advantages as it makes American products more accessible. The Europeans are actually pissed that the Euro is worth so much.

The U.S economy has its problems but it's still the strongest in the world.

[MB_722]

GDP is the dollar amount of goods and services produced a country. Debt isn't part of the equation.

The drop in the value of the dollar actually has its advantages as it makes American products more accessible. The Europeans are actually pissed that the Euro is worth so much.

The U.S economy has its problems but it's still the strongest in the world.

But it isn't as if you are consuming less to make a difference on what you are exporting.

[MattT]

that makes no sense at all. china does own around a trillion US in our debt though. i read on google news that the canadian dollar will reach us1.05 soon.

Yeh things are good here, the economy is great!, we are following in the footsteps of Europe with regards to the dollar.

[Thin Lizzy]

Yeh things are good here, the economy is great!, we are following in the footsteps of Europe with regards to the dollar.

As I said, it can actually be a disadvantage. If it gets too strong, Canadians will be heading south to spend their money.

This summer I took Amtrak to Saratoga, which is the half-way point to Montreal, a few times. The train was loaded with Canadians.

[MB_722]

AP
Canadian Dollar Reaches Parity With U.S.
Thursday September 20, 12:40 pm ET
By Rob Gillies, Associated Press Writer
Canadian Currency, the 'Loonie,' Reaches Parity With U.S. Dollar; First Time Since 1976


TORONTO (AP) -- The Canadian dollar reached parity with the U.S. dollar on Thursday for the first time since November 1976.
Known as the loonie because of the bird pictured on the one-dollar coin, the Canadian dollar has been gaining ground on its American counterpart since hitting an all-time low of 61.79 U.S. cents on Jan. 21, 2002.

This week the loonie rose sharply against its U.S. counterpart after the Federal Reserve announced a dramatic half-point cut in its benchmark interest rates. The Bank of Canada, meanwhile, has kept its equivalent rates stable.

As a result, the spread between U.S. and Canadian interest rates widened, making Canada a more attractive place for German, Japanese, American and other foreign investors to put their money.

The soaring loonie also reflects the strong fundamentals of the Canadian economy, which has benefited from record world crude oil prices and strong demand for metals, coal, chemicals and grain.

At the same time, the United States has been squeezed by a collapse of a big chunk of its housing market and a worsening credit crunch.

"Canadians are getting a lot richer relative to Americans. The parity exchange rate is just one example of that," said Jeff Rubin, Chief Economist and Strategist at CIBC World Markets.

"It really reflects the rise of the resource economy in Canada and the rise of western Canada and the decline of the manufacturing sector and the manufacturing heartland of Canada in Ontario," Rubin said.

The western Canadian province of Alberta is home to vast reserves of oil sands, a tar-like bitumen that is extracted using mining techniques. Industry officials estimate the oil sands will yield as much as 175 billion barrels of oil, making Canada second only to Saudi Arabia in crude oil reserves.

"The Canadian economy that once use to be the sleepy little resource backwater of the North American economy, is certainly turning the tables on its big brother in a hurry," Rubin said.

The high Canadian dollar will increase the number of cross-border shopping trips as Canadian consumers come to the U.S. to buy clothes, shoes and electronic gear. Many goods in Canada haven't been reduced yet to reflect the rising Canadian dollar.

"It's going to take some time before it trickles down to us," said Linda An, who calls herself a shopaholic. "Shopping, especially for big ticket items is great now in the U.S."

The high dollar will hurt Canadian manufacturers who sell goods in the U.S. Canadian Auto Workers economist Jim Stanford warned that the sector, largely based in Ontario, will lose hundreds of thousands more jobs if the dollar remains at current levels.

[MattT]

As I said, it can actually be a disadvantage. If it gets too strong, Canadians will be heading south to spend their money.

This summer I took Amtrak to Saratoga, which is the half-way point to Montreal, a few times. The train was loaded with Canadians.

Yeh that makes sense.

[dr.chimps]

that makes no sense at all. china does own around a trillion US in our debt though. i read on google news that the canadian dollar will reach us1.05 soon.

Agreed. Stole my thunder. Can't believe Matty is giving out financial opinions. Guy doesn't even know simple geography.

[Tre]

I don't have a problem with it catching up, but the fact that it took only 5 years to do so is ridiculous.

I used to be able to travel in Canada for next to nothing and now it costs out the ass.

I can't believe that Centura allowed itself to be purchased by RBC, but my stock is doing quite well. 

[Archer77]

China holds a lot of our curreny. Foreign investment in the dollar is what gives it strength considering that it is not back by a real value.  Foreign countries are already beginning to divest in U.S. Dollar in exchange for Euro's.  If that where to be the case the dollar and our eonomy would plummet.  I think that what the confusion about the U.S. owing China money comes from.  In Greenspan's new book he talks a little about this subject.  

[MB_722]

do any of you do forex?

[Hedgehog]

Rank Country GDP (millions of USD)
— Gross world product 48,244,879
1 United States 13,201,819
2 Japan 4,340,133
3 Germany 2,906,681
4 China 2,668,071
5 United Kingdom 2,345,015
6 France 2,230,721
7 Italy 1,844,749
8 Canada 1,251,463

The only relevant number is GNP per capita. Otherwise small countries with extreme wealth will not be shown. And big countries that are poor, will place higher than they should.

Here is the top list:Rank    Country    GNP Per Capita
1    Flag of Luxembourg Luxembourg    $ 76,000
—    Flag of Bermuda Bermuda    $ N/A
2    Flag of Norway Norway    $ 66,500
—    Flag of Liechtenstein Liechtenstein    $ N/A
—    Flag of the  Channel Islands    $ N/A
3    Flag of Switzerland Switzerland    $ 57,000
4    Flag of Denmark Denmark    $ 51,700
5    Flag of Iceland Iceland    $ 50,500
6    Flag of Ireland Ireland    $ 45,500
7    Flag of the United States United States    $ 44,900
—    Flag of San Marino San Marino    $ N/A
8    Flag of Sweden Sweden    $ 43,500
9    Flag of the Netherlands Netherlands    $ 42,600
—    Flag of Qatar Qatar    $ N/A
10    Flag of Finland Finland    $ 40,600
11    Flag of the United Kingdom United Kingdom    $ 40,100
12    Flag of Austria Austria    $ 39,500
13    Flag of Belgium Belgium    $ 38,600
14    Flag of Japan Japan    $ 38,400
15    Flag of Germany Germany    $ 36,600

[affy]

how much are rupees worth in dubai?

[MB_722]

1.00 INR = 0.0922185 AED

1 AED = 10.8438 INR

[dr.chimps]

I don't have a problem with it catching up, but the fact that it took only 5 years to do so is ridiculous.

I used to be able to travel in Canada for next to nothing and now it costs out the ass.

I can't believe that Centura allowed itself to be purchased by RBC, but my stock is doing quite well. 

Almost the same amount of time that Dubya made that call to patriotic Americans to spend, spend, spend their way to a better post-911 future. 

/reap what ya sow, etc.

[MB_722]

Parity and beyond

Ever since the Canadian dollar bottomed out at 61.79 cents US on Jan. 21, 2002, it has been on a seemingly unstoppable charge higher.

Since then, the loonie's value has risen by 62 per cent, driven by surging commodity prices, a healthy economy and rising interest rates.

Then, on Sept. 20, 2007, the dollar finally hit a level that seemed most unlikely just a year earlier — parity with the U.S. greenback for the first time in almost 31 years.

The question now being asked is how high the Canuck buck will go.

Canadians may not remember that the loonie was actually worth more than the U.S. greenback for much of 1972, 1974 and 1976 (see chart above). On April 25, 1974, the Canadian dollar went as high as $1.0443 US.

Going back even further, the loonie was worth more than $1.06 US in August 1957.

Most analysts are not expecting it to head to those lofty levels again. But some are.


Beyond parity?

Dennis Gartman, who writes an influential market newsletter, thinks $1.05 US is possible.

"Our clients know us as very long-term bulls on the Canadian dollar, having said for many years that the U.S. dollar and the Canadian dollar are heading eventually toward parity," he wrote on Sept. 11.

"Far beyond parity is entirely possible."

Some of the reasons for the Canadian dollar's strength have been around for years. Commodity prices have been soaring in the last few years. Oil, copper, gold, wheat — you name the resource and Canada seems to produce and export it in abundance.

The loonie is also drawing strength from the comparative strength of the Canadian economy. Canada has healthy budget and trade surpluses; the U.S. runs big deficits in both. The Canadian economy is still generating jobs, while the American economy is shedding workers.

The Canadian housing picture is also much healthier, with little evidence of the subprime meltdown that's shaken the U.S.

The weakness south of the border has the U.S. Federal Reserve slashing interest rates, while the Bank of Canada may soon be raising rates to rein in inflationary pressures.

That divergence has been noticed by currency traders. The futures markets show that speculators are increasingly betting that the Canadian dollar will extend its gains.

The U.S. dollar, on the other hand, has been limping through historic weakness. It's now at an all-time low against the euro.


The implications of parity

On an exchange rate basis, that U.S. vacation is now 60 per cent cheaper than it was back in 2002. We can also expect to see even more Canadian licence plates in the parking lots of U.S. shopping malls near the Canadian border.

Investors who have U.S. stocks will have noticed that the loonie's rise has wiped out the gains they would have otherwise enjoyed. As of Sept. 20, 2007, the Dow Jones industrial average is up 10.6 per cent since the start of the year. But the loonie is up 15 per cent against the U.S. dollar over the same time period. That translates into a bottom line loss for Canadian investors.

It's cheaper to import goods from the U.S. than it has been for a generation. Those who export to the U.S., on the other hand, are hurting even more.

The Canadian Labour Congress cites the high dollar as the main reason for the loss of 250,000 manufacturing jobs since 2002.

But there is no chance that the government would order the Bank of Canada to take measures that would drive down the value of the dollar. The central bank doesn't take orders from the Prime Minister's Office. As Liberal finance critic John McCallum put it: "Once you've got a floating exchange rate, you've got to let it float."

Canada's top banker isn't about to depart from the floating exchange rate that Canada and the United States have had for the past 37 years. In a speech in early May, David Dodge acknowledged "our floating dollar has appreciated sharply and thus, has forced some necessary adjustments."

But he maintained that "a flexible exchange rate regime has definitely helped Canada to maintain production close to full capacity and to minimize the effects of the boom-bust cycles in various sectors."

So look for the loonie to stay high and perhaps go higher still - a floating journey with implications far beyond the currency trading desks.

For one thing, a dollar on par with the greenback makes it easy to compare prices of the same goods in Canada and the U.S. That comparison is even easier with the internet.

Will Canadians tolerate paying $22 for a book that costs $17.50 in the U.S.? How about paying $399 for an iPod that costs $349 in the States? How about shelling out $10,000 more for a luxury European car than the Americans do?

The pressures to reprice may just be beginning.

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

how long do you think it will last?

[Thin Lizzy]

The only relevant number is GNP per capita. Otherwise small countries with extreme wealth will not be shown. And big countries that are poor, will place higher than they should.

GNP per capita can be deceptive, as well.

Just because a small country has extreme wealth doesn't make it an economic power. Qatar is a good example. It has a lot of oil but that's it.

[Livewire]

I herd that the US owes China alot of money, so in reality China should be near the top.

When you owe the bank $10,000 - the bank owns you.

When you owe the bank $10 mil - you own the bank.

China has trillions of reasons to see the US succeed

[24KT]

Actually it's worth less than the loonie if you're paid in US$ 

I went to the bank on Friday and got the shock of my life. I didn't bother transfering my cheque into my Cdn account because I would have lost money, ...just left it in the US$ account, and pulled out cash in US currency. I never thought I'd see the day when store owners grimace when you want to give them US cash at par. 

It's costing us soo much money it's crazy. I tried to buy a MacLeans. The sticker price said $4.99 US  $7.99 Cdn. I tried to give her $4.99 US. She refused saying we're in Canada, you have to pay me the Cdn price, ...but of course she was happy to first convert my US currency to Cdn, and charge the extra $3. 

The stores in Niagara Falls, Detroit, and all the border towns are absolutely loving the extra business tho. Car sales and electronics sales south of the border are very brisk with all the Canadians rushing over to go shopping, and to fill up their gas tanks.

[Thin Lizzy]

do any of you do forex?

A few years ago, I threw a grand into an account to see what it was like. I came to the conclusion that the small investor has no shot in that game.

You have to set stop losses so that you don't wake up one day wiped out, but when you do set them, there's always a spike one way or the other that stops you out. Even though I was right about the direction of the dollar, I kept getting stopped out by the spikes. So, if you can't win even when you're right, how can you win?