Quote:
Originally Posted by McG
economically speaking, a long term dollar at par isn't likely a good thing for Canada.
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I am getting tired of these types of comments from certain corners.
The dollars value is the result of various conditions of the economy being valuated in the open market versus other world economies. It is by definition the valuation of our output. It can't be "too high"or ""too low" because if it were either it would simply move to where it should be over time.
Even when used to support positions like "the dollar is killing our manufcturing sector" it is not true. Our manufacturing sector is dying because (off the top of my head) (1) increased competition from 3rd world countries (2) low Canadian productivity and (3) the higher relative output dollar from natural resource extraction versus manufacturing for every input dollar invested. The current rise of the dollar is the sum reflection of all of those factors. No one mentions that manufacturing has been in decline since its peak (as a percentage of total output) in like 1946! ALl they talk about is how the "dollar is too high".
That dollar simply cannot be "too high" or "not be a good thing for Canada". It IS Canada (for better or worse) - that is what it represents, the sum of all Canadian economic value.
The only thing it can do is move too quickly up or down, but moderation of currency valuation is an entirely different thing...
Claeren.