Loonie News

[Sheriff Roland]

The Canadian Dollar, as represented by the 1$ coin's logo (the loon) is usually referred to as the loonie

The value of the Canadian dollar, or loonie, has again been on the rise in recent months (+ 10% this year) when compared with the US$ (heck, it's done well compared to most foreign currencies). Though in the past week or so there has been a decline, the loonie is still expected, by most economists, to achieve parity with the greenback (US$) by year's end, or soon thereafter.

So this thread is intended to focus on the news, or effects of this economical development.

Sorry to disappoint those who were expecting bugs bunny.  

[Sheriff Roland]

In recent months, Canadians (well at least the Southern Ontario Press) has been focused on the possibility of adding a Canadian hockey team in Hamilton at the expense of the economically failling Coyotes of Phoenix AR.

It is said that in some American markets ticket prices for a hockey game are almost comparable to cinema prices. (Ok, I exagerate - but just barely). Here in Toronto, even though we've gone without a Stanley Cup win in more than 4 decades (the last win was in 1967), and in spite of the recent financial upheaval worldwide, the Maple Leafs organisation had again this year raised it's ticket prices. Even the nose-bleed seats are selling for over 200$ a ticket - and they were still selling out. (Well not so much anymore that the Leafs are now in last place in the whole NHL with a 1-8-1 record - but I digress ...)

It is generally accepted that the Winnipeg and the Québec franchises both moved to the American market because of the low value of the Canadian dollar. (At the time of the moves, one CN$ was only worth about 0.75US$.) Since hockey is such a hugely popular sport in Canada (we even fill up large arenas for international junior hockey & women's hockey games), the increased possibility of a long term parity between the two currencies have increased the chatter of having more hockey franchises in Canada.

The loonie's power play within the NHL

http://www.thestar.com/sports/hockey/nhl/article/717729--the-loonie-s-power-play-within-the-nhl

"A host of southern U.S. cities might now be more likely to lose their NHL teams..."

Every three-cent jump in the value of the Canadian dollar triggers a 1 per cent revenue increase for the NHL...

"If one can argue that venue A in Canada was superior to venue B in the sunbelt, that differential is bigger than it was before," Zimbalist said. "It also makes the clientele of Canadian clubs richer than they would otherwise be, which makes them more able to buy seats and beer and products advertised in the arenas."

The dollar's rise adds weight to the argument for more Canadian clubs, says NHL player agent Ritch Winter...

[Sheriff Roland]

Russia to Buy Canadian Dollars, Mulls More Currencies

http://www.bloomberg.com/apps/news?pid=20601087&sid=at5XsdLU.68w&pos=5

Russia’s central bank will add Canadian dollars to its reserves and may include more currencies as it seeks to reduce its dependence on the U.S dollar.
...

Russia’s decision reflects a desire to shield reserves against the dollar’s decline after the U.S. currency lost 13.3 percent against the euro in the past 12 months, making it the worst performer against Europe’s single currency of the 16 major currencies tracked by Bloomberg in the period.

and this:

http://www.theglobeandmail.com/report-on-business/russia-sparks-canadian-dollar-rally/article1376753/

The Canadian currency has risen 16.7 per cent this year against the greenback, one of the world's top-performing currencies.

[Kelda]

Yes, I was defo no expecting news about Canadian monetry values!

[Sheriff Roland]

Loonie closer to U.S. parity

http://www.cbc.ca/canada/toronto/story/2010/03/17/dollar-moves-higher.html

The Canadian dollar marched closer to parity with its U.S. counterpart Wednesday, supported by higher commodity prices and the prospect of continued low American interest rates.

The loonie traded at 99.26 cents US shortly after 1 p.m. ET, up 0.64 of a cent on the day...

[Sheriff Roland]

It's been a little over a year and what had been 'predicted' has happened: the loonie HAS achieved parity with the U.S. greenback and has surpassed it.

But unlike the rapid rise of 4 years ago, this upturn in the value of the loonie has been gradual - very progressive - and is therefore expected to be more permanent.

Loonie soars: Hits highest level since 2007

http://www.montrealgazette.com/business/Loonie+soars+Hits+highest+level+since+2007/4647772/story.html


The Canadian dollar surged above $1.05 U.S. Wednesday for the first time since November 2007, because of strong inflation, higher commodity prices and a renewed slump in the greenback amid worries over the U.S. fiscal outlook.

and from Reuters, U.S. edition, http://www.reuters.com/article/2011/04/20/markets-canada-dollar-bonds-idUSN2017151720110420

Adam Cole, global head of FX strategy at RBC Capital Markets, said there was little left in the way of U.S. dollar support that would impede a return of the Canadian dollar to its modern-day high of $1.10.

[Sheriff Roland]

It is generally accepted that the Winnipeg and the Québec franchises both moved to the American market because of the low value of the Canadian dollar. (At the time of the moves, one CN$ was only worth about 0.75US$.) Since hockey is such a hugely popular sport in Canada (we even fill up large arenas for international junior hockey & women's hockey games), the increased possibility of a long term parity between the two currencies have increased the chatter of having more hockey franchises in Canada.

This, from a few days ago ... http://www.montrealgazette.com/sports/Canada+could+support+teams+report/4604598/story.html

Canada could support six new NHL teams: report


“The biggest criticism of this report should be that it’s stating the obvious,” Keller said. “There’s just no question that these markets could support NHL teams and could generate higher revenues than the average team in the sunbelt, even the average team in the entire United States.”

[Front-Ranger]

What they're saying is no doubt true. There just seems to be something unnatural about ice hockey in the Sunbelt states, the LA Kings excepted.

[Sheriff Roland]

What they're saying is no doubt true. There just seems to be something unnatural about ice hockey in the Sunbelt states, the LA Kings excepted.

California and Florida are very popular snowbird destinations and are no doubt extensively patronized by those Canadians, but why would the be 2 teams in each of those southern states? And Nashville and Phoenix and even Denver are not drawing the crowds that Tornto, Montreal and Vancouver do. Not to mention tickets sell in many of those American cities for 10 to 25% of what Canadians pay up here - even for Maple Leaf tickets - a team that has NOT made the playoff for a record six seasons in a row! Even games played in Buffalo (a border city) are generally attended by more Canadians than Americans.

No! Betman and the team owners are continuing to attempt to americanize the game - that is to say, they are continuing to promote the game south of the border even though many of those teams (where tickets are as cheap as 15 to 125$) are being subsidized by Canadian teams (price 150 to 450$).

[Sheriff Roland]

It truly is a wonder that the League continues the 4 decade old unsuccessful strategy!

http://www.torontosun.com/sports/hockey/2011/04/12/17962611.html

Study: Canada can support 12 NHL teams

The study said the NHL has been following an unsuccessful strategy for the past four decades of trying to expand in the U.S. and generate interest in the sport. Many of the franchises suffer from low fan interest and weak revenue.
...
A Canadian hockey team is likely to pull in about $23 million US more a year in gate revenue than a rival in a U.S. city, thanks to the Canadian passion for the sport, the study found.

The study also found that hockey mad Canadians are also helping to subsidize the sport south of the border. Canadian teams accounts for only one-fifth of the league, but generate one-third of the revenue.

"A good chunk of those dollars end up in the U.S. through revenue sharing," it said. "The primary beneficiaries of this scheme are American hockey team owners and a smattering of American fans attending games below cost. The primary victims are Canadian hockey fans, particularly those in cities that could support a team but are deprived from having one or two by the NHL."
...
Add to that a practice of revenue sharing among the poorer teams and it's likely that 90% of Canadian television revenue from the games goes to the U.S.

The study assessed the most economically viable potential locations for new hockey teams in Canada.

It found the best location for a new team would be in Ontario's Greater Golden Horseshoe, a market of nine million that could support three teams, it said.

There is enough demand for a second team in both Vancouver and Montreal, as well as Winnipeg and Quebec City, it found. Any of those locations would be likely to generate higher gate revenues than existing U.S. teams, it said.

Canadians outside of Quebec were about 40 times more likely than Americans to have been watching a national broadcast of NHL hockey during the week of April 26, with the audience in Quebec likely to have been 90 times bigger, it found.

That's 40 times and 90 times ... which means 4 000% and 9 000% - the comparison is mind boggling!

[Sheriff Roland]

The loonie, which a couple of decades ago was worth less than 0,70$US, has been at parity, or better (Remember the '07 Alberta Pilgrimage, when the loonie reached 1,08$US?) for nearly a decade. Canada's economy has been really stable, with AAA+ ratings for financial institution as well as most governments (federal and provincial).

Now it seems another nation is showing interst.

http://www.cbc.ca/news/business/story/2012/03/02/iceland-loonie.html

Could Iceland adopt the loonie?


Will the loonie soon be flying high in ... Iceland?

For months, Icelanders have been toying with the idea of ditching the tarnished krona, which has never fully recovered from the collapse of the financial system four years ago.

But one of the intriguing suggestions floating around the North Atlantic island is that instead of the adopting the euro — a natural fit given that Iceland has taken initial steps to join the European Union — it might cast a furtive eye to the Canadian loonie.

This is not as outlandish as it sounds. Canada's banking system is something Iceland's is not — sound — and the Canadian economy, with its mooring in much-desired natural resource wealth, is among the most stable and predictable in the advanced world.

Canada also does not have the massive overhang of sovereign debt that will trouble Europe or even the United States for years.
...

Bank of Montreal economist Douglas Porter says the feat can be accomplished. Iceland would need to buy sufficient Canadian currency to do the trick, which likely will initially put upward pressure on the loonie.
...

But the impact on Canada would be small, he said, since Iceland's population is only about 317,000 and the economy is less than one per cent of Canada's.

There are precedents. El Salvador and Ecuador have both unilaterally adopted the U.S. dollar in the past dozen years, and Kosovo has the euro.

"Frankly, I think we should take it as a great compliment. I know everybody thinks of Iceland as a basket case, but they are beginning to turn things around," Porter said.

"It shows you how far we've come in the past 10 years that people are even talking about this."

[Aloysius J. Gleek]

The loonie, which a couple of decades ago was worth less than 0,70$US, has been at parity, or better (Remember the '07 Alberta Pilgrimage, when the loonie reached 1,08$US?) for nearly a decade. Canada's economy has been really stable, with AAA+ ratings for financial institution as well as most governments (federal and provincial).

Now it seems another nation is showing interst.

http://www.cbc.ca/news/business/story/2012/03/02/iceland-loonie.html

Could Iceland adopt the loonie?


Will the loonie soon be flying high in ... Iceland?

For months, Icelanders have been toying with the idea of ditching the tarnished krona, which has never fully recovered from the collapse of the financial system four years ago.

But one of the intriguing suggestions floating around the North Atlantic island is that instead of the adopting the euro — a natural fit given that Iceland has taken initial steps to join the European Union — it might cast a furtive eye to the Canadian loonie.

This is not as outlandish as it sounds. Canada's banking system is something Iceland's is not — sound — and the Canadian economy, with its mooring in much-desired natural resource wealth, is among the most stable and predictable in the advanced world.

Canada also does not have the massive overhang of sovereign debt that will trouble Europe or even the United States for years.
...

Bank of Montreal economist Douglas Porter says the feat can be accomplished. Iceland would need to buy sufficient Canadian currency to do the trick, which likely will initially put upward pressure on the loonie.
...

But the impact on Canada would be small, he said, since Iceland's population is only about 317,000 and the economy is less than one per cent of Canada's.

There are precedents. El Salvador and Ecuador have both unilaterally adopted the U.S. dollar in the past dozen years, and Kosovo has the euro.

"Frankly, I think we should take it as a great compliment. I know everybody thinks of Iceland as a basket case, but they are beginning to turn things around," Porter said.

"It shows you how far we've come in the past 10 years that people are even talking about this."

Wow! Incredible!  (And I remember 1998 - 2002 when the loonie was about 0.66 US cents, or even lower.)

http://en.wikipedia.org/wiki/Canadian_dollar

[Kelda]

Wow, didn;t know that could be done, or that El Salvador and Ecuador had taken on US dollars.

[Sheriff Roland]

Brinks crash spills millions in coins (about 60 miles east of Timmins)

http://www.cbc.ca/news/canada/sudbury/story/2012/03/28/sby-hwy11-crash.html

A crash of a Brinks tractor-trailer in northeastern Ontario this morning seriously injured the two occupants, and scattered millions of dollars in Canadian coins on the highway and in the nearby bush.
.....

One of the tractor-trailer units was reportedly carrying candy, which was also strewn across the crash site.

One comment posted gave me quite a loud laugh:

"And I thought Ottawa was the only palce you could find a field full of loonies..."

And then there were the following:

"I knew we had to put money into our roads...but this is rediculous."

"Those big rigs cannot stop on a dime."

"*CHANGE* we can believe in."

"Candy AND money? Sweet!"

"There must be a full moon out here. I've never read so many witty comments on one article. This is better than any sitcom!"

"Would the coins have rolled north to Hudson Bay or south to the Great Lakes?" (***The answer, of course, is North, as the Arctic Watershed is about 20 miles (30 km) south of there.****)

""They may use front-end loaders to scoop up dirt, which will be sifted through at another location later." ... so it's dirty money and will need to be laundered."

[Front-Ranger]

This was all the talk around the office today! (I'm currently at my company's home office in Toronto).

[ifyoucantfixit]

   On that note, I will go to bed.  All is right with the world for a while..

[Kelda]

One comment posted gave me quite a loud laugh:

"And I thought Ottawa was the only place you could find a field full of loonies..."

 

[Sheriff Roland]

You hear? Stephen Colbert's on the warpath again, denouncing the encroaching Canadian on all things American ... (Yea I know he's doing it for laughs ...)

Stephen Colbert warns Americans of poutine-sucking Canada’s audacious currency coup

http://www.thestar.com/business/article/1167637--stephen-colbert-warns-americans-of-poutine-sucking-canada-s-audacious-currency-coup

Funnyman Stephen Colbert poked fun at America’s “poutine-sucking, healthcare-addicted” nemesis to the North during an episode of The Colbert Report Tuesday night, pointing to recent news that economically beleaguered Iceland considered adopting the Canadian loonie.
...

Colbert warned Tuesday night, “this is just the beginning of Canada’s currency coup.”

Perhaps more concerning for Americans, Colbert said, is the Canadian Mint’s glow-in-the-dark Alberta dinosaur coins — 25-cent coins that reveal a dinosaur skeleton when placed under the light.

“Folks, Canada’s coming after our young people. What do you think they’re going to prefer: a glow-in-the-dark dino quarter or this green rectangle?” he said. “Nation, we must fight this before we lose a generation of young Americans to the scourge of Canadian politeness and fiscal sanity.”

“As for you, Canada,” he ended, “you keep your dinosaurs where they belong — liquefied in your tarsands and pumped directly into our gas tanks.”

[ifyoucantfixit]

   Wow those are awesomely cool.  I want some...

[Sheriff Roland]

Wow those are awesomely cool.  I want some...

Well it'll cost ya ... They're only minting a few thousand copies and selling them at 30$ a piece. The coins are not likely to get into general circulation.

And THAT's the rest of that story ...