Thursday, May 24, 2007

A strong Canadian Dollar: Good for me, bad for farmers

So this morning I had to go to a meeting where they explained why sales projections were so low for 2007-08. The main reason is the strong Canadian dollar. But that's what happens when you export everything. This also has a negative affect on farmers as they have to export their goods as well, so farm prices are going to drop and farmers aren't going to be happy.

On a positive note, I am quite happy with the high Canadian dollar because I'm trying to save money for Grad school in the states and when the Canadian dollar is high everything is less expensive. If the Canadian dollar increases 1 cent I need $4,000 less for grad school. If it were par I'd need about $43,000. So I'm considering opening a U.S. dollar bank account so that I can take advantage of the high dollar. For example if I put in $100 Canadian right now I would get $92.43 U.S. if the Canadian dollar drops to 90 cents then I've still got $92.43 U.S. but if I invested $100 CDN @ 90cents I only get $90 American. Of course this backfires if the Canadian dollar strengthens. And 2 dollars may not seem like a whole hell of a lot but it's $20 if you're talking in thousands and $200 if you're talking in tens of thousands so you see how the FX changes could be really important to me.

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