benefits of a strong cad$?

Discussion in 'Economics' started by battle river, Nov 7, 2007.

  1. having experienced the pleasure of now losing $10 for every $100 usd i make,makes me wonder what the benefits of having a strong currency?
    manufacturing will be hurting,no consumer benefit from lower retail prices.domestic tourism will be hurting
    i guess importers will do better cause they dont pass on the savings to consumers.lower inflation(in theory)

    don't see much benefit overall.
    any thoughts? thanks!
  2. I don't think there is any benefits in the short to midterm. No one will buy anything made in Canada. CAD is out of control and not even the Bank of Canada is ppwerful enough to stop it. They would have to cut rates on half and flood the markets with loonies.
  3. strong currency means healthy economy and sound monetary policy, super low input costs, cheap new technologies,
    and consumer benefits from low prices, it just doesn't happen overnight

    there are no disadvantages from strong currencies

    why do we need poor american tourists? There are rich countries with strong currencies and toruistrs from those countires will visit Canada

    I think we might even introduce visas for americans as Canadian dollars gets stronger at some point we will get a flood of illegal immigrants with US passports
  4. LOL! Haha!

    Stock Trad3r, is that you??
  5. empee


    strength of currency is a proxy for your standard of living

    strong currency == means your standard of living is going UP
  6. don't be a fool. US will beg for what is made in Canada and pay any price for it - because Canada makes oil, natural gas, grains etc.

    If US doesn't need it. We don't mind. China will buy everything
  7. umm,i think we need us tourists since they can drive here in massive #'s while the others have to fly.flood of illegal US citizens? all they have to do is ask to get in
  8. This effect is very real. Think about commodity prices as well. The rise in oil prices will have a more moderate inflationary effect when the canadian dollar appreciates. Combined with cheaper imports this will have a significant moderating effect on inflation.

    The Central bank in turn can opt for a less strict monetary policy, as inflation is partially countered by the strong domestic currency.

    Think about hedging against Canadian dollar appreciation if your income depends on it.
  9. kongkaka


    As long as oil price runs high, Canadian dollar will keep strong no matter what.