Canadian Dollar keeps going up
- Thread starter Cobster
- Start date
danmand said:
someone said:
Are you rich? Let me guess correctly: No, No and No.Questor said:
Gyaos Baltar.
Have you noticed
As dollar climbs mortgage rates lending rates and interest the banks are paying you on $$$ is also climbing.
As dollar climbs mortgage rates lending rates and interest the banks are paying you on $$$ is also climbing.
Looks like you got your wish:Papi Chulo said:
http://news.sympatico.msn.ctv.ca/To...newsitemid=CTVNews/20071029/oil_prices_071029
Yes.LateComer said:
I'm very worried that the Chinese might decide to retaliate against the US posturing against Iran, by selling off 5% of the paper the Chinese hold. That would be enough to seriously drive the US economy into a full blown recession.
The weak dollar is sad news for us Americans. On the other hand, it should be a field day for Canadians wanting to invest in the US. If I were Canadian I would seriously consider buying a second home in Florida. Strong Canadian Dollar, weak American Dollar coupled with falling Florida Real Estate prices means a great deal for someone. Don't forget my Broker fee if you buy!
Not really. It would make the US interest rate go up (in order to attract buyers to the T-bills),LateComer said:
which would in turn make the $US increase in relative value (unless Canada increases the interest rate also).
"Printing" large amounts of money, as the US have done the last few years,
is inevitably followed by a devaluation of the currency (which we are seeing) and
in turn a recession caused by high interst rates.
Ask Someone for a more scientific explanation.
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I have a life and therefore don't need to discuss your financial problems.toolioiep said:
Gyaos Baltar.
So you are saying that the direct result of the Chinese selling US bonds and T-Bills will be to decrease the value of the US$ causing the US to raise interest rates to save the dollar. This is a circular argument. The fact remains that the direct result of the Chinese selling US bonds and T-Bills will be to devalue the US$. Furthermore, the US will not have the option of raising interest rates as their economy is suffering and it would cause a deeper recession (as you stated in your second paragraph).danmand said:
As I said, ask an economist like Someone.LateComer said:
T-Bills are sold by the treasury on an auction,
so when there are fewer buyers, the yield (interest)
would tend to go up. The US government need to
refinance the existing T-Bills out there, when they
come due, and a lot of them are in Chinese and Japanese hands.
According to this article, the effect of the Chinese selling off US treasuries will be to cause interest rates to rise and the dollar to go down.
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/08/07/bcnchina107a.xml
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/08/07/bcnchina107a.xml
The US Federal Reserve sets short-term interest rates.LateComer said:
Long-term rates are established by the bond market.
More sellers and less buyers equals lower prices and higher rates.
Consensus here in the states is that the Fed will lower rates by 25 basis points tomorrow. If that is the case, Prime should be reduced to 7.5%. As I understand it, Canadian Prime is currently at 6.25%. Credit should be cheaper but there is still a "monkey on the back" of consumers - horrendous consumer debt, outsourcing of jobs, declining real estate values along with the huge amount of debt adding up for the cost of the war - yes folks, the US is still at war. Being from the States, I don't think there is a quick fix or silver bullet but I sadly think we are in for some hard times moving forward unless something is done to change the current situation. Hate to say this but from a money standpoint - Canadians should be rejoicing. America is starting to have fire sale prices in real estate - take advantage before it is too late. I wish I bought your real estate, especially in Toronto, when the US dollar yielded me 1.55CDN. With appreciation and that discount, I'd have an unlimited budget for this hobby!
