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Canadian Dollar Now At Par With US Dollar

Sometimes it just doesn't pay to lower interest rates. Just when you think everything will improve with an interest rate cut the currency becomes devalued leading to higher prices on imports. So inflation now becomes an issue...and the Fed needs to raise interest rates to control inflation...and so on.

So...what is the real problem here? I imagine it is our country's need to police the globe, fight wars, defend freedom etc...and we have to pay for that...and how? Taxes of course, but maybe taxes aren't enough? Perhaps we print a little extra cash here and there to pay for those fighter jets, bombs and tanks? I'm not totally sure but I have to imagine that that is why our currency is now worth almost nothing and average houses in my area are all either close to or over $1 Million. I started a database for properties worth $1 Million and over...I can see a time when the real luxury properties will all be starting price of $2 Million and over...and that time unfortunately may be sooner than later.

Now the Canadian Dollar for the first time in over 30 years is worth what our currency is worth...it wasn't that long ago that it was worth almost 30% less...sad...no?

Any AR'ers with insight and perhaps a solution to this currency meltdown that will be associated with more rate cuts? Or perhaps you think rates will go up again...thoughts anyone?

Posted by James Lowenstern, Newton Real Estate Newton MA Real Estate on 09/21/2007 07:04 AM

Comments (7)

rate cuts, canadian dollar, inflation

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7 Comments on Canadian Dollar Now At Par With US Dollar

I'm sure glad I saved all those Canadian quarters!

One bright side..the improved exchange rate should stimulate some investment in United States property investment by Canadians. There's opportunity in every market.

09/21/2007 07:18 AM

by Wayzata Lakes Realty: Eric Kodner Sells Luxury Homes

James, We will always be in the see saw cycle. We never 100 % come out on top and that is the cycle of life.

09/21/2007 07:19 AM

by Susan Trombley Re/Max Broker Raleigh NC & Surrounding Areas (Re/Max Hometown)

Yes,it is sad but in the same token...that should bring the Canadians to the US to spend some of that Canadian $$$$.

09/21/2007 07:33 AM

by BLRGUY(Beach & Luxury Realty Inc)

That is amazing! I'm now wondering what the dollar is doing next to the Euro! A weak dollar is great for bringing in foreign investors, but it will make my next trip to France a lot more expensive! Yikes!

09/21/2007 08:43 AM

by Patricia Kennedy (Evers & Company)

I'm with Patricia on the travel dilemma! Yikes! lol. Thanks for an interesting post. You're not afraid to voice your opinion on this one and I have to say it is VERY REFRESHING! It may be a see-saw cycle but I would like to see the U.S. Gov't reallocate some of its investments back into the nation it represents! This world police mumbo jumbo is getting old! Thanks Jim! :)

09/24/2007 09:37 AM

by Martinelli Caputi & Associates, Ltd. (Martinelli Caputi & Associates, Ltd.)

Yes, our market is hurting. We have borrowed so much money and our dollar value is decreasing everywhere.

09/25/2007 10:00 AM

by Susan Trombley Re/Max Broker Raleigh NC & Surrounding Areas (Re/Max Hometown)

Yes, agreed. My firm, Plurimo Realty Advisors, is seeing more Canadians and Europeans asking me for ways to invest in real estate in California. We are seeing this with apartment and retail investments. With the loonie at new highs I believe we'll see more of this. There are tremendous values for Canadians. Michael.Duhs@cox.net

12/17/2007 01:41 AM

by Michael Duhs

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