Exchange Rate
Old 07-21-2011, 11:53 PM   #1 (permalink)
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Ive had this question in my mind for a while, but here goes. Why is it that the canadian dollar is higher than the american dollar but were still paying more for american items?
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Old 07-22-2011, 03:11 AM   #2 (permalink)
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Ya, I was noticing that too. In 2007/2008 when this last happen there were new stories galore about the price of books and cars. This time there isn't a peep.

I can understand that books are bought 4 to 6 months in advance, but if I don't see a difference in 2 months for books I'm going to be more than a bit pissed off.
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Old 07-22-2011, 07:44 AM   #3 (permalink)
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We've always been suckers or paying way more than Americans do. I can't say or sure that is the reason why, but I suspect that if we simply didn't accept paying more, that we wouldn't be asked to. Yes here have been complaints, but the sales numbers tell a story of their own.
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Old 07-22-2011, 09:24 AM   #4 (permalink)
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I'm just saying why have an exchange rate if its not serving its purpose?
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Old 07-22-2011, 10:54 AM   #5 (permalink)
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I am all for a revolution.
Just tell me what building to burn.
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Old 07-22-2011, 01:22 PM   #6 (permalink)
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I am all for a revolution.
Just tell me what building to burn.
you want another g20 on your hands? remember, this is not canada anymore
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Old 07-22-2011, 03:43 PM   #7 (permalink)
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I'm just saying why have an exchange rate if its not serving its purpose?
The purpose of the exchange rate is not to set prices, but rather to allow for the correct allotment of funds when exchanging one currency for another. If you exchange you CDN dollars for American and go down there and buy your stuff, then that's the best you can expect from what the exchange rate is meant to do.
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Old 07-22-2011, 03:46 PM   #8 (permalink)
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you want another g20 on your hands? remember, this is not canada anymore
oh god
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Old 07-22-2011, 05:29 PM   #9 (permalink)
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The purpose of the exchange rate is not to set prices, but rather to allow for the correct allotment of funds when exchanging one currency for another. If you exchange you CDN dollars for American and go down there and buy your stuff, then that's the best you can expect from what the exchange rate is meant to do.
so basically, no matter what happens the american dollar will always be higher than the canadian dollar even if the dollar is worth more than an american dollar
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Old 07-22-2011, 06:05 PM   #10 (permalink)
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Because they're American and were Canadian, its likely never to chance, they cry and complain if they don't get what they want and the price they want.

Example: Cell phones, they get amazing awesome super cool cell phones, and we get them 1223498234 years later.
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Old 07-22-2011, 06:26 PM   #11 (permalink)
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Because they're American and were Canadian, its likely never to chance, they cry and complain if they don't get what they want and the price they want.

Example: Cell phones, they get amazing awesome super cool cell phones, and we get them 1223498234 years later.
i think thats canada being behind everyone else rather than the US being ahead of canada. asia gets cool stuff many many years in advance than Canada
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Old 07-22-2011, 06:30 PM   #12 (permalink)
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If you're talking about buying American products in Canada, there's a good chance Canadian retailers have had their stock for some time and are not going to adjust the price and risk not make their margins. You also have to factor in that Canadian retailers pay for high shipping costs, brokerage fees, duty, etc. on imported goods and are most likely to pass it onto consumers, thus increasing the retail price.
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Old 07-22-2011, 07:21 PM   #13 (permalink)
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so basically, no matter what happens the american dollar will always be higher than the canadian dollar even if the dollar is worth more than an american dollar
In a way I guess. Smart investors take this time to buy American Dollars for a relatively cheap price and convert them back to Canadian dollars once the American Dollar appreciates in value. It's called arbitrage and is guaranteed profit (obviously the profit could turn out to be very small if you buy a small amount of the currency).

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If you're talking about buying American products in Canada, there's a good chance Canadian retailers have had their stock for some time and are not going to adjust the price and risk not make their margins. You also have to factor in that Canadian retailers pay for high shipping costs, brokerage fees, duty, etc. on imported goods and are most likely to pass it onto consumers, thus increasing the retail price.
+1. Sometimes they have quotas and that also raises the demand for a certain product, thus increasing prices. Obviously there's no tariff on the US products, but it really wouldn't make sense for the prices of American products to decline because that takes away from domestic sales.
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Old 07-22-2011, 08:22 PM   #14 (permalink)
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there are parts of the US that pay higher prices than we do for a lot of stuff. But in terms of nationally priced items, they have 10 times the population and prices even out to be lower than what we would pay.

this reminds me of when free trade was passed and there was the common misconception that goods would be shipped up here with the same price tags as they had in the US. It just doesn't work that way.

We are still in a better position as consumers. The difference in price is much less for most everything now, and if you import anything or travel down there the difference is quite dramatic.
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Old 07-22-2011, 09:56 PM   #15 (permalink)
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last hardcover book i bought had a price tag of 35USD and 38CD..... so it's getting better. i think you have to allow for some charges for duties, no?
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Old 07-22-2011, 10:36 PM   #16 (permalink)
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I opened up a U.S. bank account last year which I transfer Canadian dollars into. If the rate changes I plan on just shuffling the money back and fourth. It's really convenient when shopping in the States. I'm assuming a lot of you guys do this. Or not?
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