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A purely personal view: Canada's population is tiny. It has vast resources that it relies on and has relied on for decades to fund national projects via taxation of corporations that own those resources. This is the only (and fundamental) difference between the UK's projected future and Canada's. Which in turn means that if the emerging economies (especially China) slow down in the coming 6-12 months so will the Canadian economy which will affect the dollar relative to the Pound. Put another way, Canada relies on the land, the UK relies on the ingenuity of its people. With a 300 year track record of inventiveness and progress, my money is on the UK mainly because the Canadian natural resources are suddenly owned by non Canadian entities which results in huge chunks of money going overseas (including China) rather than being ploughed back into the Canadian economy. Plus, the UK election outcome was handled in a truly admirable way and showcased the Best of Brit crisis management.

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i am a amateur armchair economist, and i was wondering if anyone cared to share their long-term view of the canadian economy. my thoughts are that canada is in the middle of a property bubble that has not yet popped, but once this occurs it will be a situation very much like the UK and USA, and will lead to a much wider recession in canada. the global economy as a whole does not seem to be well. any thoughts at all?

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I agree. I think it's possible that a second wave of house price falls will hit the UK and other Western countries as interest rates start getting raised. This will be when Canadian house prices go into reverse.

A gentleman in my office is currently selling his Oakville house which apparently doubled in the last 3 years. His assertion is to cash in before the bang.

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Ive come across a property management company owner in Ontario ho has also sold ALL his properties and is renting because he is of the same opinion!!!

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I agree with a lot that you say, but my caveats would be that the current generation are not as ingenious as previous generations, and those that have real talent have been sucked into the financial services sector. Had it not been for north sea oil the UK would not have been nearly so prosperous in the past 3 decades as it has been.

Canada does rely heavily on exporting natural resources, and although much of this is managed by foreign companies, at the end of the day, if the Canadians decide they're not getting a big enough chunk off the pie, then they can screw these foreign companies with tax hikes etc. In the next two decades, once the second, probably bigger dip, of this double dip recession is out of the way, it will all be about resources, and especially oil. Canada will do well without being ingenious.

As has been mentioned above, once the global economy goes into reverse again, Oil will probably go back down to $50 a barrell, at this point the CAD$ will reverse some of its gains against other currencies, but I doubt the pound will go above $2.00 again.

My strategy was to change half my savings to CAD$ at $1.90. Effectively I don't care what happens with the exchange rate...I don't gain, but I don't lose, and most of all I don't worry.

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Yes, I think you're right.

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The only thing with all this Oil Canada has is the cost of extraction. Obtaining Oil from the Oil Sands is proving a real problem and therefore the large companies with the expertise are more likely to focus their interests more heavily elsewhere. I have a contact at BP and this is definately the case there.

It wouldn't surprise me if in 20 years we are all driving Electric cars and the Oil in the Oil Sands is still there.

I would be interested to know how much revenue North Sea Oil drove to the UK over the last 3 decades?

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Canadian Oil is only viable if the price is above $55 a barrel isn't it? Although it would be preferable to go elsewhere, I think the US will want to get more from canada as part of its energy security policy. Ultimately it would be better if the Oil did stay there, it's an environmental nightmare.

UK North Sea Oil added about 2-3% to GDP during the 80s and 90s, which doesn't sound huge, but take that out and the economy didn't grow much at all.

I'm pinning my hopes on Algal Oil, the problem with electric cars is lithium etc. Algae could proide a never ending source of Oil and could use the existing infrastructure for Oil distribution.

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Crude oil is currently extracted at around $28 per barrell.

Doing some more digging on the Oil Sands but $55 seems inline. I can't find the source but will keep looking....I'm sure I read Oil had to be above $80 for companies to make decent money from the Oil Sands but without the source I would not take my own word for it....

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:blink: I think you meant to say "anywhere between $2 and $70 per barrel."

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It's not cost as such, but EROI - oil sands require something stupid like 3 barrels of oil used to extract 4.

North Sea oil production is here

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I think I meant to say an average of $28. The source there is Wikipedia.

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$1.48 to the GBP.

Anyway here is an article on the great Oil Sands gamble:

http://www.theglobeandmail.com/repor...rticle1571659/

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If the US adopts a low-carbon oil policy, it will simply mean that it ends up importing more Middle East oil - enriching people who loathe them, and incurring unnecessary transportation costs, while Canada simply exports to countries like China who couldn't give a hoot where their supplies come from as long as they get the energy they need.

If the US formally adopts such a policy, I see a possibility of a dual price oil market. Think of other resources...

Nice juicy tomatoes from the farm up the road - $1 a pound.
Sanctimonious organic tomatoes specially flown in from halfway round the world for rich Americans with woefully misguided environmental issues - $4/lb

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BP have signed 3 huge oil sand contracts in the last 2 years. Canada will be one of bp s biggest growth areas over the next 10 years.