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Friday, November 2

Canadian Loonie Soars to Record Heights





In Canada, we have a coin that is worth $1.00. We have nicknamed it the "Loonie" because there is a Common Loon depicted on the coin. Why? Well that is a story for another day, but today the Loonie soared to a record high. Early this morning the Loonie soared two cents US to a high of $1.07.18. The reason given on the news tonight was a rise in oil prices and strong employment reports.


The soaring Loonie is not all good news for Canada. Many retailers have cut the prices of their products to bring us more inline with the US dollar because of public outcry. It seems Canadians are tired of paying so much more than the US price when our dollar is doing so good. In September I went to buy a book. The price was US $19.95 and $29.95 Canadian. I left the book in the store.


Though prices are being lowered on a daily basis, the high Loonie can cause hardships. Canadian manufacturers say that US companies are no longer importing their products because of the high Canadian dollar. US visitors to Canada are decreasing and people who do visit are not spending as freely as they were when the Loonie was worth less than the US dollar.


Though Loons don't normally fly, the Loonie has soared 25 % in 2007, when compared to the US dollar. It's the world's best performing currency this year. $1.07 is a record for the Canadian dollar and it has never been so high. I remember when I was growing up that the Canadian dollar (no, it wasn't the loonie then, it was a Canadian dollar bill) was worth $1.03 US.


What does this all mean for Canada and Canadians? Well, we'll just have to wait and see but I'm cautious. I don't see all this being well and good for our nation and repercussions may occur. Time will tell.

28 comments:

  1. And what does it mean to us the Americans? I have never understood math, let alone, differences in money, stocks, bonds, etc. ??

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  2. Ancient One

    Thanks so much for commenting on my Canadian Loonie post. We are not sure how this is going to effect us. Some think it's good. Others predict it will cause our economy some difficulties.

    I've done some research and apparently the rising Loonie will cause the Bank of Canada to cut rates if they want our economical boom to last. That would cause the Loonie to decrease in value. I'm hoping it goes down to par with the US and sits there.

    What it means for the US is that any Canadian debt owed will cost more. Also, US companies that operate in Canada (there's a lot of them) will cost the US companies that import them a higher rate of exchange. Other than that, I'm not sure of what the consequences will be. I guess we will just have to wait and see. I'm hoping that if the Loonie goes to par and sits there that we will all benefit.

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  3. Denise,

    Thanks for stopping by and commenting. I enjoyed your visit, as always.

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  4. My bank has RBC as part of its name.. so maybe we'll be ok either way..??

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  5. ancient one,

    The prediction tonight on the news is that the Loonie will reach $1.10 and then decrease to par. I think we would all be better off it the Canadian and US currency was at par. It seems strange that our countries are so close, yet there is such a big difference in the money value. In 2005, to buy a US dollar, Canadians had to pay $1.48. Still, many people from here still went to Niagara Falls NY or Buffalo shopping because they could save (or at least thought they were) money.

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  6. Mary,

    This is a very interesting and informative article. I'm happy to hear that the Canadian economy is doing so well! I just hope we can get ours back on track.

    Hugs,
    Tina

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  7. I agree with Tina that this is a very informative, interesting article.

    I wish you the best of luck with your currency/economy, Mary!

    I really enjoyed reading this post, as I do all your wonderful posts ;0)

    Smiles,
    Michele

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  8. Tina,

    Thanks for the comment. However, this might be the lull before the storm. A high Loonie can cause problems that can decrease our economy substantially. Being that high isn't necessarily good.

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  9. Michele,

    I'm a bit leary of the Loonie being so high. If it goes as high as $1.10 by the end of the year, as is being predicted, it could cause us problems. We'll hope that it stablizes and that the US and Canadian economies levels out. That would be better for all concerned.

    Thanks for the visit. I always enjoy your comments.

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  10. I was thinking of writing a piece on the strange behaviour of the Looney. It is apparently the best performing currency in the World.
    Most articles credit the Canadian economy and the value of our resources, oil and metals. It has not been good for the forest industry.
    It is remarkable that only three or four years ago it was $0.63US.

    Little has been written that the falling value of the US dollar has contributed to the Looney's rise.

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  11. Philip,

    I hope you do write about the rising Loonie and how it compares to the falling of the US dollar. World finances is something that baffles me. I did a bit of research to write this, but still don't completely understand. Be my guest and try to set us straight on how the currencies affect us.

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  12. I'm far from an economic expert there lot confusing news about the economy lately.
    Oil is at record high usual Fridays they change our gas prices here at local station. I notice one station was up to $3.14 a gallon and I got mine still at $3.09 a gallon.
    Plus everything else is going up and notice our pay check aren't going as far as it did.

    I'm back doing my regular blog I was Confession time...busy trying to win some prizes and give one away over at the fall give away

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  13. I can remember visiting family in Montreal when I was young and how confused I was trying to figure out how much things cost across the border. Then somehow I managed to avoid every Economics class in school so I'm still confused.

    Have a wonderful weekend.

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  14. I'm thinking that if I tried to figure all this out, along with all of the implications, I would end up in the "Loonie Bin". (Sorry I just couldn't resist) lol

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  15. Joan,

    I keep up to date on currency exchange rates. It's been years since our dollar has been worth more than the US dollar. It's all rather confusing right now because it seems backwards to me. When I was a kid, our dollar was worth $1.03 US. However, that has been quite a while.

    Thanks for commenting. I appreciate your visit

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  16. Lynn,

    You made me smile. That is so ingenious. I think we're all headed to the Loonie bin with all that's going on in the world. Today things are just too fast paced. Blessings.

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  17. Mary,

    Your vast interests and knowledge never ceases to amaze me. I never know when I come here what interesting subject you will be writing about next. Thank you for educating us! All I know about our economy is that gas prices are rising, as are prices for everything else, so I have to be careful with my spending. The report on the Loonie was most interesting. Great job!

    Take care and have a nice weekend. The weather here has been spectacular.

    Renie

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  18. My missionary daughter lives in Mexico,and she uses a debit card from our bank and it changes the money from there to here and it is hard to know what is what!! Thanks for sharing with us!!

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  19. I've always wondered why books cost so much in Canada...jeepers I would probably give up buying them at all!

    That is a pretty coin!

    Have a great day!

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  20. OK...so I want to try this trackback thing at the bottom of this comment section but forgot to check the mark when I left my comment...

    So I'm leaving another just to see how this all works...you and a few others respond in comments and I've tried it for today to see if I like it...
    =)

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  21. Renie,

    My interests are vast and I like to keep up with what's going on in the world, but somethings confuse and baffle me, like world finances.

    Thanks for your comments. I always enjoy your visits.


    Grams,

    That would be sooo confusing to have the debit card change the currency for you. I do believe the American dollar is much higher than the peso, but I'm not even sure of that. I haven't checked that for a long time.

    Thanks for visiting. And many blessings to your missionary daughter.

    Tammy,

    Christian fiction runs from about $14.95 up here. I don't buy too many books. I buy them for the grandsons and for gifts, but not many for myself. Sometimes I do if they are on sale. Our christian drugstore had a half price sale on christian fiction this August, so I bought some then. Now I'm back to using the library.

    Please let me know how the trackback works for you. Blessings to you and yours.

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  22. Wow...this is pretty cool to go into the email and see your response...saves having to actually come back to the blog and such.

    I would do a lot of Library visits myself...lol!

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  23. Hi Mary,

    I'm tagging you for a fun, new meme:

    "If you had an extra hour each day, what would you write?"

    Here's the link to mine:

    http://writingthecyberhighway.
    blogspot.com/2007/11/if-i-had-
    extra-hour.html

    Smiles,
    Michele

    P.S. The meme Tina tagged me for is right below the writing meme. I posted them both today ;0)

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  24. Our CDN dollar is not high compared to the Euro and Yen. The decreased performance of the US dollar is a big factor in our comparative rise in value. The global market is hard to understand.

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  25. Ruth,

    Yes, the world finances is sure hard to understand. Thanks for your comments. Blessings to you for a great weekend.

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  26. I know that price has been bring many Canadians into America for their items!

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  27. The good news is that it's a great time for you to travel : ).
    * * *
    We're having a little bit of an inflation on prices/they say it is due to a strong economy as Aussies are spending more thus prices are higher...I say drought means everything is more expensive...This will result in an interest rate hike as bankers who have loaned money out want to be compensated for the buying power of their dollar which can't buy as much now...and the federal bank likes to keep economic growth/consumption within a certain percentage as the government of course is worried about the economic implications for foreign trade. They hope a higher interest rate will make people less willing to pay the money for overpriced items...er like food?

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