Canadian dollar almost at parity with US, will pass it soon

[Kuciwalker]

We don't have a union.

Obviously. So? My point stands that diverse economic needs can be well-served by a single monetary policy, and in fact are better served by a single monetary policy.

[notyoueither]

You'd make a right good Roman.

[Tingkai]

Originally posted by notyoueither
I am not convinced we need a lower Canuck buck.

Why do we need the Canadian dollar at par with the U.S. dollar?

Just because the Canadian dollar is at 75 cents U.S. doesn't mean we are weak, inefficient, less productive or less competitive.

It simply reflects a difference in prices in Canada versus prices in the United States. It reflects different costs.

Originally posted by notyoueither
We built the auto plants in an era of an over par Canuck buck.

Plants built in the 70s have long been replaced. Besides, CAW salaries are calculated on the lower Canadian dollar. With the exchange rate suddenly higher, Canadian auto plants become artificially less competitive.

Originally posted by notyoueither
The last 20 years and a 0.65 cent dollar at the nadir were a function of adjustment to new trading patterns. Between 1970 and now our focus shifted from the CW to NA.

Even in the 1960s, most of our trade was with the U.S. and besides which, the exchange rates would have adapted long ago to the increased trade with the U.S.

The Canadian dollar stabilized at the 65 to 75 U.S. cent range for decades. In the last five years, it has suddenly shot up, even though there has been no change in the economic fundamentals of either country that could justify the change.

That's why the Canadian dollar at par with the greenback is artificial.

[Tingkai]

Originally posted by Kuciwalker

We don't have a union.

Obviously. So? My point stands that diverse economic needs can be well-served by a single monetary policy, and in fact are better served by a single monetary policy.

The facts say otherwise.

[Kuciwalker]

Please provide the facts that demonstrate the US states would be better off with independent monetary policies.

[Kuciwalker]

Originally posted by notyoueither
You'd make a right good Roman.

Is that supposed to be an insult or some other jab at my argument?

I'm still waiting for an actual refutation.

[Tingkai]

Originally posted by Kuciwalker
Please provide the facts that demonstrate the US states would be better off with independent monetary policies.

It's your argument, prove it. I await the display of your economic expertise.

[Kuciwalker]

I already demonstrated it, but I'm happy to repeat it once more.

1. There is not significantly more diversity between the economic fundamentals of Canada and the United States, than between individual U.S. states.

2. The U.S. states have benefited far more from a unified monetary policy than they would have from independent monetary policies.

Ergo, Canada and the United States would benefit more from a unified monetary policy than from the current independent monetary policies.

QED.

So, which do you dispute? The first or the second premise?

[Tingkai]

Simply stating a hypothesis does not make it true. Your first point is clearly wrong. Your second point is debatable since we do not know what would have happened if there was not a unified currency in the U.S.

You're still in university, right? If you get a chance to take an economics history course, you might find it fascinating.

Good day.

[Kuciwalker]

Originally posted by Tingkai
Simply stating a hypothesis does not make it true.

They're called premises, not hypotheses. The idea being that they are commonly accepted, and if you dispute either it should be easy to demonstrate that you are clueless.

Your first point is clearly wrong.

Oh? Canada as a whole has less in common economically with the US than Alaska does with Virginia? Than Rhode Island and Montana?

Your second point is debatable since we do not know what would have happened if there was not a unified currency in the U.S.

It's pretty obvious that the enormous barrier to trade represented by individual state currencies would have significantly hindered national economic development. Or you can look at the EU - another example of economic growth in diverse economies promoted by a common currency and monetary policy.

You're still in university, right? If you get a chance to take an economics history course, you might find it fascinating.

You're only allowed to patronize me after you convince me you're intelligent. I haven't seen any evidence yet.

[notyoueither]

Originally posted by Tingkai


Why do we need the Canadian dollar at par with the U.S. dollar?

Just because the Canadian dollar is at 75 cents U.S. doesn't mean we are weak, inefficient, less productive or less competitive.

It simply reflects a difference in prices in Canada versus prices in the United States. It reflects different costs.

It also means we pay higher costs for equipment from computers to mega-industrial-atom-crushers.

It increases the costs of starting or expanding a business anywhere from Dildo Nfld to Flyspeck SK.

It's good for people who want to exploit cheap labour that is highly educated, has a long lifespan, and gets fixed up at state cost if they get a boo-boo. It's not so good for the workers who want to exchange their labour for fancy gizmos that are imported.

Plants built in the 70s have long been replaced. Besides, CAW salaries are calculated on the lower Canadian dollar. With the exchange rate suddenly higher, Canadian auto plants become artificially less competitive.

Canadian auto plants sill have highly educated, well looked after workers to slap things together. That may be why Canadian auto plants may have more shifts than American ones if the auto makers can manage it and won't be the first plants closed, usually.

The auto industry opened and grew here when the US dollar was way below the Can Buck. The high value of the Can Buck did not hold us back then. It should not now.

Even in the 1960s, most of our trade was with the U.S. and besides which, the exchange rates would have adapted long ago to the increased trade with the U.S.

The Canadian dollar stabilized at the 65 to 75 U.S. cent range for decades. In the last five years, it has suddenly shot up, even though there has been no change in the economic fundamentals of either country that could justify the change.

That's why the Canadian dollar at par with the greenback is artificial.

Growing trade with the US was a fact of geography and the fact that we sell resources. A lot of emphasis in our economy was still with Britain and the CW.

Britain joining the EC was a final wake up call. Any advantages we had enjoyed in trade with the CW was going away and rapidly diminishing trade with the UK was acknowledged. That forced a re-evaluation of our priorities.

That was the '70's. It culminated in the FT election when Canada's electorate endorced continental trade over the objections of many in the most divisive election we'd had in many a year.

And the Can Buck has never been 0.65 to 0.75 'for decades' except for a period during the recent adjustment.

That was artificial.

[notyoueither]

Originally posted by Kuciwalker


Is that supposed to be an insult or some other jab at my argument?

I'm still waiting for an actual refutation.

Nope, but I'd guess political representation isn't a big deal for you or you wouldn't be so clueless as to suggest it's a good idea for other nations to adopt American monetary policy because RI seems to do well with it.

[Kuciwalker]

Originally posted by notyoueither
Nope, but I'd guess political representation isn't a big deal for you or you wouldn't be so clueless as to suggest it's a good idea for other nations to adopt American monetary policy because RI seems to do well with it.

In case you don't remember, this entire argument is from a purely economic standpoint. If you add political considerations the whole thing is obviously absurd. Perhaps I should have added the requirement that the monetary policy wouldn't be biased in favor of the United States, but I'm not even sure that it's necessary. By the same diversity argument, Canada's economic interests are sufficiently close to the U.S.'s that individual U.S. states are more likely to be hurt by a given decision than Canada as a whole.

[notyoueither]

Stop wasting our time.

We aren't discussing your pet theories from la la land.

[Kuciwalker]

That's funny, you've been doing so for two pages now. The terms of the argument were clear at the beginning. So I guess you're just admitting my argument is valid and sound?