commodities
The oil price-loonie transmission mechanism
The most interesting comments from Bank of Canada Governor Mark Carney last week, in releasing the Bank's semi-annual Monetary Policy Report, dealt with the relationship between the price of oil and the Canadian currency. The Globe and Mail reported Carney as publicly questioning why currency traders automatically presume such a direct link between the loonie and the world oil price. After all, he accurately pointed out, Canada produces a lot more than just oil.
Canada and the next world financial crisis
How will the next financial crisis erupt? (Or perhaps we should describe it as a further chapter of the ongoing financial crisis.) It's like figuring out which piece of tinder will ignite after a sizzling heat wave. We know it's bad out there, but just where will the next spark hit? What follows is one of many- potential financial crisis scenarios that Canada could face.
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How to rein in the loonie
March 10 was the day the CEO of Citibank announced his bank was profitable again, igniting a global rally that's boosted stock markets by 50 per cent or more. Unfortunately, it was also the day the loonie began what has become the fastest, biggest upswing in its history.
From 77 cents (U.S.) in March, the loonie has rocketed up 25 per cent, touching almost 96 cents by Friday. It won't be long before our loonie is worth more than the U.S. greenback. That may cause a certain nostalgic smugness among some old-timers (who remember when "a dollar was a dollar"). But it's unequivocally bad news for our economy.
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- Tell the truth and avoid rumours.
- Add context and background.
- Report typos and logical fallacies.
- Be respectful.
- Respect copyright - link to articles.
- Stay focused. Bring in-depth commentary to our discussion forum, babble.
Don't
- Use oppressive/offensive language.
- Libel or defame.
- Bully or troll.
- Post spam.
- Engage trolls. Flag suspect activity instead.
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