Canadian dollar sinks below 88 cents as Saudis cut oil to $77

[corporatejay]

Doesn't the low dollar really help here though? If Oil is at $50, that's 60$ CAD, which is what you're paying your employees/trades in (typically).

[Fire]

Originally Posted by cdutka

I worry they cut the rates, why overdrive the rest of the country to help Alberta.

I doubt BoC would cut rates and if they did it would be to help all of Canada and not just Alberta. Low oil hurts all of Canada.

[Cowboy89]

Originally Posted by corporatejay

Doesn't the low dollar really help here though? If Oil is at $50, that's 60$ CAD, which is what you're paying your employees/trades in (typically).

I think it's a mitigating factor, but does not wholly compensate for the loss of the commodity price. I recall seeing something recently that used CNRL as an example that all else being equal losses more on the decline in oil prices than it gains back due to currency movements in relation to the fall in commodity prices.

[driveway]

If you live in Calgary, particularly if you own a home in Calgary, isn't the absolute last market you want your money in Oil and Gas? Aren't you exposed enough?

[ricosuave]

BakerHughes laying off 7K.

http://www.usatoday.com/story/money/...7000/22042433/

[FLAMESRULE]

And the Bank of Canada just cut interest rates by 0.2% to 0.75% in a pretty unexpected move. Yay for cheaper mortgage/HELOC/LOC etc...

http://www.bnn.ca/News/2015/1/21/Loo...c-outlook.aspx

http://www.theglobeandmail.com/repor...ticle22548417/

[chemgear]

Originally Posted by FLAMESRULE

And the Bank of Canada just cut interest rates by 0.2% to 0.75% in a pretty unexpected move. Yay for cheaper mortgage/HELOC/LOC etc...

http://www.bnn.ca/News/2015/1/21/Loo...c-outlook.aspx

http://www.theglobeandmail.com/repor...ticle22548417/

And boo for a 80 cent dollar.

I look forward to further increased borrowing by Canadians and the extension of car loans to 10 year terms.

EDIT:

From the Globe article:

The rate move, which few analysts anticipated, is an attempt by Mr. Poloz to shield highly indebted Canadian households from an oil-induced hit to their jobs and incomes – signs of which are already evident in Alberta.

(Let's lower rates and let them borrow even more!)

[oilyfan]

A lower dollar on the whole is better for Canadians.

[Red]

They will do everything they can to keep this going until the federal election.
They kicked this can down the road in 09 and now we're back at it. Problem is they are almost out of rabbits in the hat and it's probably too late anyways.

[Krovikan]

How does overdriving the rest of Canada which is growing, therefore more likely to take advantage of the low rate, at a vain attempt to save jobs in Alberta and other oil producing provinces? This move is pretty stupid actually, I hope the Conservatives get the boot next election, all they have proven in their governance is how bad at managing the countries economics and making the tough choices.

Yes I understand that means Liberals in power, but lesser of two evils at this point.

[oilyfan]

Originally Posted by cdutka

How does overdriving the rest of Canada which is growing, therefore more likely to take advantage of the low rate, at a vain attempt to save jobs in Alberta and other oil producing provinces? This move is pretty stupid actually, I hope the Conservatives get the boot next election, all they have proven in their governance is how bad at managing the countries economics and making the tough choices.

Yes I understand that means Liberals in power, but lesser of two evils at this point.

Which provinces are growing that we will "overdrive"?

[Fire]

Originally Posted by cdutka

How does overdriving the rest of Canada which is growing, therefore more likely to take advantage of the low rate, at a vain attempt to save jobs in Alberta and other oil producing provinces? This move is pretty stupid actually, I hope the Conservatives get the boot next election, all they have proven in their governance is how bad at managing the countries economics and making the tough choices.

Yes I understand that means Liberals in power, but lesser of two evils at this point.

BofC does not equal Government of Canada.

[Krovikan]

Originally Posted by oilyfan

Which provinces are growing that we will "overdrive"?

Ontario and BC are both set to outgrow Alberta this year. Toronto and Vancouver housing markets are worry points for a bubble in Canada. Please do your own research before you attempt to "disprove" someone with an unsubstantive post, quick search on news.google.ca would answer your question.

Originally Posted by Fire

BofC does not equal Government of Canada.

While technically true, policies and appointments are driven by the Government of Canada.

[InglewoodFan]

Bugger, I'm taking the family to Europe this summer on an extended vacation and this dollar isn't helping. Pondering buying some Euros to hedge against it getting worse.

[oilyfan]

Originally Posted by cdutka

Ontario and BC are both set to outgrow Alberta this year. Toronto and Vancouver housing markets are worry points for a bubble in Canada. Please do your own research before you attempt to "disprove" someone with an unsubstantive post, quick search on news.google.ca would answer your question.



While technically true, policies and appointments are driven by the Government of Canada.

BoC, while appointed by the government makes fiscally sound decisions independent of political control.

There is real threat of deflation in Canada, look that up on news.google.com. To combat that BoC is taking a proactive stance.


MOD EDIT: No insults, please.

[Barnet Flame]

Originally Posted by InglewoodFan

Bugger, I'm taking the family to Europe this summer on an extended vacation and this dollar isn't helping. Pondering buying some Euros to hedge against it getting worse.

The dollar is 1c down against the pound from the rate when I was in Calgary last year.

Against the Euro, the dollar has been as low as 1.55 and as high as 1.38 to the Euro in the past 12 months. It is currently at 1.43.

The falls against other currencies are nowhere near as pronounced as against the USD. Other than the Swiss Franc, almost all major currencies have fallen relative to the USD.

[polak]

Posted this in that other thread but:

How about we focus on diversifying our economy. For every dollar that Oil goes over $90 bucks a barrel, O&G producers need to pay an extra royalty which gets distributed to non-oil and gas companies.

This would attract all industries when times are good. Not just the ones that can benefit from Oil and it's not like O&G companies are going to close shop when there is +90 dollar oil to be had.

[GGG]

Originally Posted by polak

Posted this in that other thread but:

How about we focus on diversifying our economy. For every dollar that Oil goes over $90 bucks a barrel, O&G producers need to pay an extra royalty which gets distributed to non-oil and gas companies.

This would attract all industries when times are good. Not just the ones that can benefit from Oil and it's not like O&G companies are going to close shop when there is +90 dollar oil to be had.

Dont give it to other businesses. Do what should have been done from the first drop of oil being extracted from the ground.

All resource revenues go into a government fund that only interest is used for government revenues. This would allow lower general overall taxes long term and ensure that the future expenses are well taken care of. A long term subsidy of non-oil buisnesses is still problematic as thsoe business would suffer with any oil downturn which is what your are trying to avoid.

[polak]

Originally Posted by GGG

Dont give it to other businesses. Do what should have been done from the first drop of oil being extracted from the ground.

All resource revenues go into a government fund that only interest is used for government revenues. This would allow lower general overall taxes long term and ensure that the future expenses are well taken care of. A long term subsidy of non-oil buisnesses is still problematic as thsoe business would suffer with any oil downturn which is what your are trying to avoid.

They would only lose their subsidies in weak oil years but their might be enough good years to entice them to come here in the first place.

[Slava]

Originally Posted by InglewoodFan

Bugger, I'm taking the family to Europe this summer on an extended vacation and this dollar isn't helping. Pondering buying some Euros to hedge against it getting worse.

Hopefully you didn't buy those Euros yesterday. Today the ECB announced 1.2 TRILLION in quantitative easing to fight deflation. The Euro was down significantly this morning against the USD (I didn't look against the CAD, but I assume it would be there as well).