Exchange rate
Sep 18th 2008, 10:59 am
#1516
BE Enthusiast
Joined: Aug 2005
Location: Was Brentwood, Essex Now Wasaga Beach, Ontario
Posts: 895
Re: Exchange rate
Probably, however it is the abundance of raw materials which is the success story for Canada. Harper actually acknowledged just the other day that the US has been in a slowdown for 2 years and as yet it hasn't hurt Canada.
Look at Euro regions. Probably the strongest economy out of US, Japan, UK and them. The Euro has been very strong for 3 years, it hasn't crippled the economy there. Sure a strong currency creates some problems, but they can be overcome.
Look at Euro regions. Probably the strongest economy out of US, Japan, UK and them. The Euro has been very strong for 3 years, it hasn't crippled the economy there. Sure a strong currency creates some problems, but they can be overcome.
Sep 18th 2008, 11:31 am
#1517
mclauchlan35
Joined: Dec 2006
Location: Was Prestwick Ayrshire, now Canmore AB.
Posts: 999
Re: Exchange rate
I would have thought that tourism and exporting are big earners, I think there will be a big decline in tourism next year which could have a negative effect.
Sep 18th 2008, 12:53 pm
#1518
BE Enthusiast
Joined: May 2006
Location: Fall River, NS
Posts: 478
Re: Exchange rate
Sep 20th 2008, 1:02 am
#1519
Immigration Consultant
Joined: Jun 2007
Location: Halifax, Nova Scotia
Posts: 2,144
Sep 20th 2008, 2:57 pm
#1523
BE Forum Addict
Joined: Nov 2006
Location: Nusajaya
Posts: 2,327
Re: Exchange rate
It's no laughing matter.... I have to stump up nearly 11k.
The worst thing is it's based on the sale price or the municipality evaluation (MV), whichever is higher!
In my case I bought the place for a lot less than the municipal valuation. Even my bank said to challenge it. as their valuations normally come in higher then the MV. In this case it was much less, too.
This is why I have held off paying, as I'm trying to work out how to challenge their valuation.
Well, back on topic, I think next week is going to be fireworks as tax payers absorb the implications of using their money to save reckless financiers packages with the "bail out". Funny isn't it, when things are going well the shareholders take all the profit. When they go wrong, you and I are expected to chip in so they don't lose money!!! Private profit, socialist losses.
Which means I think the dollar could be in for a very rough ride, hopefully taking the CAD down a peg or two!
Last edited by geedee; Sep 20th 2008 at 3:00 pm.
Sep 23rd 2008, 2:10 am
#1524
Tea Drinker
Thread Starter
Joined: Nov 2006
Location: Kamloops, BC
Posts: 5,387
Re: Exchange rate
Massive nervousness among investors
- US Dollar in the spotlight
- Loonie and Pound react to changing risk appetite
Sterling mooched around below Monday's $1.9150 opening level for three days, going as low as $1.89. It jumped to $1.94 on Wednesday and peaked above $1.95 the following day. On Friday it fell back almost to $1.90 before another bounce, this time to $1.94. When London opened this morning it was trading just above $1.92.
The economic data that normally inform investors' hopes and fears were almost entirely irrelevant last week. In much the same way nobody worries about a dripping tap when the house in on fire, the market cared not a jot for such trivia as a rise in UK CPI inflation to 4.7 per cent or a rise in Canadian wholesale sales.
The bankruptcy of Lehman Brothers and the US government's forced purchase of insurer AIG made everyone nervous about everything. Closer to home, the rescue-by-takeover of the Halifax made them nervous about the Pound, just as the nationalisation of Northern Rock had done a year earlier.
The global trend during the first half of the week was to dump anything that smacked of risk and to move the proceeds into anything that looked safe. There was precious little that fit the bill so money poured into gold and US Treasuries. Such was the demand for US government bonds and bills that the yield on three month bills fell at one point to just 0.02 per cent.
On Thursday US Treasury Secretary Hank Paulson announced a plan to buy from banks the illiquid assets - potentially anything from mortgages to student loans - that precipitated and are perpetuating the credit crunch. Although the details of the rescue package were sketchy the news brought a surge of relief that boosted equity markets and initiated a partial reversal of the flight to quality. The news was not however so helpful to the US Dollar. Investors fear that by taking all that dodgy debt onto the Federal balance sheet the Treasury will harm the financial standing of USA Inc, even to the extent that its own credit ratings will suffer.
Whether or not that eventually turns out to be the case, the Paulson rescue plan - details of which have not yet been finalised or approved - is working against the US Dollar. The market is all too aware that desperate measures are only called for at desperate times. There has been a big shift in the market's outlook for the US Dollar since Mr Paulson outlined his plan on Thursday evening because, to paraphrase John Maynard Keynes, when the facts change, the market has to change its mind.
And it might have to change its mind again when the Paulson plan graduates from proposal to action and we see what is actually involved. Or it might not. It leaves the Pound and the Loonie as bystanders to the Battle of the US Dollar. Buyers of the Canadian Dollar have little alternative but to hedge half their exposure with a forward purchase. These are not normal times for the FX market or any other and it would be rash to make, or to rely on, any predictions about where the Sterling/CAD exchange rate is heading.
Sep 23rd 2008, 9:59 am
#1525
BE Enthusiast
Joined: May 2006
Location: Fall River, NS
Posts: 478
Re: Exchange rate
They said it again LOL
Massive nervousness among investors
- US Dollar in the spotlight
- Loonie and Pound react to changing risk appetite
Sterling mooched around below Monday's $1.9150 opening level for three days, going as low as $1.89. It jumped to $1.94 on Wednesday and peaked above $1.95 the following day. On Friday it fell back almost to $1.90 before another bounce, this time to $1.94. When London opened this morning it was trading just above $1.92.
The economic data that normally inform investors' hopes and fears were almost entirely irrelevant last week. In much the same way nobody worries about a dripping tap when the house in on fire, the market cared not a jot for such trivia as a rise in UK CPI inflation to 4.7 per cent or a rise in Canadian wholesale sales.
The bankruptcy of Lehman Brothers and the US government's forced purchase of insurer AIG made everyone nervous about everything. Closer to home, the rescue-by-takeover of the Halifax made them nervous about the Pound, just as the nationalisation of Northern Rock had done a year earlier.
The global trend during the first half of the week was to dump anything that smacked of risk and to move the proceeds into anything that looked safe. There was precious little that fit the bill so money poured into gold and US Treasuries. Such was the demand for US government bonds and bills that the yield on three month bills fell at one point to just 0.02 per cent.
On Thursday US Treasury Secretary Hank Paulson announced a plan to buy from banks the illiquid assets - potentially anything from mortgages to student loans - that precipitated and are perpetuating the credit crunch. Although the details of the rescue package were sketchy the news brought a surge of relief that boosted equity markets and initiated a partial reversal of the flight to quality. The news was not however so helpful to the US Dollar. Investors fear that by taking all that dodgy debt onto the Federal balance sheet the Treasury will harm the financial standing of USA Inc, even to the extent that its own credit ratings will suffer.
Whether or not that eventually turns out to be the case, the Paulson rescue plan - details of which have not yet been finalised or approved - is working against the US Dollar. The market is all too aware that desperate measures are only called for at desperate times. There has been a big shift in the market's outlook for the US Dollar since Mr Paulson outlined his plan on Thursday evening because, to paraphrase John Maynard Keynes, when the facts change, the market has to change its mind.
And it might have to change its mind again when the Paulson plan graduates from proposal to action and we see what is actually involved. Or it might not. It leaves the Pound and the Loonie as bystanders to the Battle of the US Dollar. Buyers of the Canadian Dollar have little alternative but to hedge half their exposure with a forward purchase. These are not normal times for the FX market or any other and it would be rash to make, or to rely on, any predictions about where the Sterling/CAD exchange rate is heading.
Massive nervousness among investors
- US Dollar in the spotlight
- Loonie and Pound react to changing risk appetite
Sterling mooched around below Monday's $1.9150 opening level for three days, going as low as $1.89. It jumped to $1.94 on Wednesday and peaked above $1.95 the following day. On Friday it fell back almost to $1.90 before another bounce, this time to $1.94. When London opened this morning it was trading just above $1.92.
The economic data that normally inform investors' hopes and fears were almost entirely irrelevant last week. In much the same way nobody worries about a dripping tap when the house in on fire, the market cared not a jot for such trivia as a rise in UK CPI inflation to 4.7 per cent or a rise in Canadian wholesale sales.
The bankruptcy of Lehman Brothers and the US government's forced purchase of insurer AIG made everyone nervous about everything. Closer to home, the rescue-by-takeover of the Halifax made them nervous about the Pound, just as the nationalisation of Northern Rock had done a year earlier.
The global trend during the first half of the week was to dump anything that smacked of risk and to move the proceeds into anything that looked safe. There was precious little that fit the bill so money poured into gold and US Treasuries. Such was the demand for US government bonds and bills that the yield on three month bills fell at one point to just 0.02 per cent.
On Thursday US Treasury Secretary Hank Paulson announced a plan to buy from banks the illiquid assets - potentially anything from mortgages to student loans - that precipitated and are perpetuating the credit crunch. Although the details of the rescue package were sketchy the news brought a surge of relief that boosted equity markets and initiated a partial reversal of the flight to quality. The news was not however so helpful to the US Dollar. Investors fear that by taking all that dodgy debt onto the Federal balance sheet the Treasury will harm the financial standing of USA Inc, even to the extent that its own credit ratings will suffer.
Whether or not that eventually turns out to be the case, the Paulson rescue plan - details of which have not yet been finalised or approved - is working against the US Dollar. The market is all too aware that desperate measures are only called for at desperate times. There has been a big shift in the market's outlook for the US Dollar since Mr Paulson outlined his plan on Thursday evening because, to paraphrase John Maynard Keynes, when the facts change, the market has to change its mind.
And it might have to change its mind again when the Paulson plan graduates from proposal to action and we see what is actually involved. Or it might not. It leaves the Pound and the Loonie as bystanders to the Battle of the US Dollar. Buyers of the Canadian Dollar have little alternative but to hedge half their exposure with a forward purchase. These are not normal times for the FX market or any other and it would be rash to make, or to rely on, any predictions about where the Sterling/CAD exchange rate is heading.
Oct 1st 2008, 7:02 pm
#1526
Forum Regular
Joined: Apr 2008
Location: Was Leeds, UK now Peterborough, ON
Posts: 58
Re: Exchange rate
Are there any experts out there able to give an educated view of which way the exchange rates may go in the medium term or are things too unpredictable to do that?
We are selling up at the moment and considering our options if the house does sell soon. We will have a lump of money to take to buy a new house in Canada so my question is do we take a hit from what we hoped to exchange for (we started looking 3 years ago so all our planning has been based on getting at least 2.10!), or do we leave our money here and offset the interest earned here against the interest on a mortgage in Canada so at least we don’t have to exchange all the money now. We would then look to exchange it in possibly 2-3 years time and pay the mortgage off.
Also, if we did do this, are there any tax implications for waiting for better exchange rate?
We are selling up at the moment and considering our options if the house does sell soon. We will have a lump of money to take to buy a new house in Canada so my question is do we take a hit from what we hoped to exchange for (we started looking 3 years ago so all our planning has been based on getting at least 2.10!), or do we leave our money here and offset the interest earned here against the interest on a mortgage in Canada so at least we don’t have to exchange all the money now. We would then look to exchange it in possibly 2-3 years time and pay the mortgage off.
Also, if we did do this, are there any tax implications for waiting for better exchange rate?
Oct 2nd 2008, 2:24 am
#1527
BE Enthusiast
Joined: Aug 2005
Location: Was Brentwood, Essex Now Wasaga Beach, Ontario
Posts: 895
Re: Exchange rate
With the current economic climate opinions are changing on a daily basis. In 13 yrs of trading i have never seen a situation like this.
UK braced for rate cuts, therefore weaker sterling should be on the cards, however price of oil dropping and showing no signs of being near the bottom. If it breaks through $70 a barrel then the Alberta boom is over, and that would destroy the Canadian economy. The picture is changing so rapidly.
Are you one of the those people who can, bite the bullet and never look back or are you an if only person?? That is basically where you are left at the moment.
Chris
UK braced for rate cuts, therefore weaker sterling should be on the cards, however price of oil dropping and showing no signs of being near the bottom. If it breaks through $70 a barrel then the Alberta boom is over, and that would destroy the Canadian economy. The picture is changing so rapidly.
Are you one of the those people who can, bite the bullet and never look back or are you an if only person?? That is basically where you are left at the moment.
Chris
Oct 2nd 2008, 3:10 am
#1528
Joined: Aug 2005
Posts: 14,227
Re: Exchange rate
With the current economic climate opinions are changing on a daily basis. In 13 yrs of trading i have never seen a situation like this.
UK braced for rate cuts, therefore weaker sterling should be on the cards, however price of oil dropping and showing no signs of being near the bottom. If it breaks through $70 a barrel then the Alberta boom is over, and that would destroy the Canadian economy. The picture is changing so rapidly.
Are you one of the those people who can, bite the bullet and never look back or are you an if only person?? That is basically where you are left at the moment.
Chris
UK braced for rate cuts, therefore weaker sterling should be on the cards, however price of oil dropping and showing no signs of being near the bottom. If it breaks through $70 a barrel then the Alberta boom is over, and that would destroy the Canadian economy. The picture is changing so rapidly.
Are you one of the those people who can, bite the bullet and never look back or are you an if only person?? That is basically where you are left at the moment.
Chris
The west is heading for either a total meltdown (unlikely) or a long and drawn out recession / depression. Assuming we don't get weimar republic style hyperinflation - assets are going to continue to depreciate so if you have a house to sell - sell it now if you can and try not to chase the market down. In all likelihood we aren't going to see 2007 prices again for at least 10 years and probably for a generation. The era of "earning" money by virtue of simply owning a house is over; wealth generation is going to have to come from people doing actual work.
Back to the exchange rate: My opinion is that GBP is going to head south over the medium to long term so buying now is what I would do (not least because it's always best to be long in the currency you are going to use day-to-day).
If you think that GBP can strengthen but want to hedge against it not doing so - buy an option on it at todays price (you can get these through most money dealers at around 3% of option value depending on how big it is)
If you want to hedge against TEOTWAWKI then put 10 to 15% of your cash in physical gold and stockpile whiskey and cigarettes for trading ;-)
(note that I'm an anonymous poster on a web-forum - do your own research etc etc ;-))
Oct 2nd 2008, 12:22 pm
#1529
Joined: Jul 2007
Posts: 2,139
Re: Exchange rate
Well, this is getting scary now. I need to buy $CAD cash, and have been holding off for a while now watching all the fluctuations nervously. The best I can find today for cash is with crown currency exchange at 1.8537.
I'm happy enough with the amount of $CAD that will give me, it seems that holding out for anything closer to 1.90 may be foolish!
All the information I see points to things only getting worse at least in the short term....unless someone wants to tell me otherwise I think I'll be buying before the end of the week.
I'm happy enough with the amount of $CAD that will give me, it seems that holding out for anything closer to 1.90 may be foolish!
All the information I see points to things only getting worse at least in the short term....unless someone wants to tell me otherwise I think I'll be buying before the end of the week.
Oct 2nd 2008, 1:10 pm
#1530
Immigration Consultant
Joined: Jun 2007
Location: Halifax, Nova Scotia
Posts: 2,144
Re: Exchange rate
I'm not convinced we'll ever see $70 oil again unless the USD strengthens significantly (I'm bullish on USD as they have a fairly diverse economy - but I think 30% rises are unlikely). I also suspect the big oil producers will start reducing supply and leave the oil in the ground if $70 oil starts looking likely.
The west is heading for either a total meltdown (unlikely) or a long and drawn out recession / depression. Assuming we don't get weimar republic style hyperinflation - assets are going to continue to depreciate so if you have a house to sell - sell it now if you can and try not to chase the market down. In all likelihood we aren't going to see 2007 prices again for at least 10 years and probably for a generation. The era of "earning" money by virtue of simply owning a house is over; wealth generation is going to have to come from people doing actual work.
Back to the exchange rate: My opinion is that GBP is going to head south over the medium to long term so buying now is what I would do (not least because it's always best to be long in the currency you are going to use day-to-day).
If you think that GBP can strengthen but want to hedge against it not doing so - buy an option on it at todays price (you can get these through most money dealers at around 3% of option value depending on how big it is)
If you want to hedge against TEOTWAWKI then put 10 to 15% of your cash in physical gold and stockpile whiskey and cigarettes for trading ;-)
(note that I'm an anonymous poster on a web-forum - do your own research etc etc ;-))
The west is heading for either a total meltdown (unlikely) or a long and drawn out recession / depression. Assuming we don't get weimar republic style hyperinflation - assets are going to continue to depreciate so if you have a house to sell - sell it now if you can and try not to chase the market down. In all likelihood we aren't going to see 2007 prices again for at least 10 years and probably for a generation. The era of "earning" money by virtue of simply owning a house is over; wealth generation is going to have to come from people doing actual work.
Back to the exchange rate: My opinion is that GBP is going to head south over the medium to long term so buying now is what I would do (not least because it's always best to be long in the currency you are going to use day-to-day).
If you think that GBP can strengthen but want to hedge against it not doing so - buy an option on it at todays price (you can get these through most money dealers at around 3% of option value depending on how big it is)
If you want to hedge against TEOTWAWKI then put 10 to 15% of your cash in physical gold and stockpile whiskey and cigarettes for trading ;-)
(note that I'm an anonymous poster on a web-forum - do your own research etc etc ;-))
This information revolution, and the wealth it created, has driven a huge boom in real estate. To the extent that it has become part of our culture that we simply expect our house to make money for us. For a lot of people (myself included) things have always been that way for as long as we have owned a house so nobody knows any different - a house has been an investment as much as it has been somewhere to live. But historically this isnt the way things have worked. As Alan 2005 says you used to have to work hard and get paid well to build wealth.
I personally think that in years to come people will look back on this era as being extraordinary - to think that people used to make more money on the value of their homes than they actually earned at work - it will probably seem ridiculous!