Christian Conservative Christian "Independent"

I'm an evangelical Christian, member of the CPC, but presently & unjustly exiled to wander the political wilderness.
All opinions expressed here are solely my own.

Friday, June 01, 2007

Are our job losses due to USA's problems?

That's a question that I'd like to pose to everyone in the light of the protests about Canadian manufacturing job losses the other day. Many have said that we're losing jobs due to the rising value of our dollar, and want the Government to step in.

How do you propose to do that when the root cause of our dollar rising is not necessarily due to our own economic activity, but due to the falling US Dollar?

I took a quick look at the trending since 2001, and when you look at the value of the US Dollar in comparison with other currencies, you can see almost the exact same trendline in all of them... the value of the US Dollar has declined when compared with all of these major currencies:

Austrailian Dollar
British Pound
Canadian Dollar
Indian Rupee
New Zealand Dollar
Russian Rouble
Singapore Dollar
Swiss Franc
South African Rand

(the only one of note that USA gained value against is the Japanese Yen)

And that's not just with currencies... it's with precious metals too... almost an identical trendline...


So, my question is this... what on earth does the CAW expect Mr. Harper, or even the Liberals should they return to power in the next few years, to do about it? Trigger a recession?


  • At Fri. Jun. 01, 03:12:00 p.m. EDT, Anonymous Anonymous said…

    Canadians are one of the least productive (Return on investment) people in the world. The CAW mostly always followed it's sister UAW south of the border, in which they went too far and became too expensive. The UAW/US auto mfgr are also hurting as consumers are continuing to shift from 'old' domestic to the 'new' ununionized domestic brands (Toyota, Hyundai, Honda) and the imports. Better bang for the buck according to consumer surveys.

    The weak Can. dollar was offsetting the costly unionized CAW plants. Now, the jobs are being either relocated to the south or overseas because of the strong dollar/shrinking sales.

    There is nothing the Government SHOULD do except subsidized and that's a big NO NO!

    The only ones who truly can do something about it is the unions themselves: Take pay and/or benefit cuts and/or increase output.
    Compete with the new competition.

  • At Fri. Jun. 01, 07:55:00 p.m. EDT, Anonymous Anonymous said…

    The Canadian dollar rises with commodity prices, as we are a resource rich country. If you are old enough to recall you will remember the same thing happened in the seventies when commodities were up. The value of our currency is largely beyond the Control of the Canadian government they have only two levers they can use interest rates and inflation.
    1/. Interest rates - They can be lowered which makes our currency less attractive to foreigners. This would hurt Canadian savers even more than they already have been (especially people on fixed incomes).
    2/. Inflation - they can print more Canadian dollars to make them less valuable in comparison to other countries currencies. They have a lot of competition in this area most countries are increasing their money supply in the double digits per year. Canada was about 9% last year.
    Our manufacturing is not by the way being lost to the USA. They have also lost millions of manufacturing jobs. The jobs are going to lower cost producers mostly China.
    As well our higher dollar is not all bad. Oil is priced in US dollars. Imagine the price now if our currency had not gone up as well.


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