posted on Jun, 8 2006 @ 11:14 PM
A Lower USD isn't such a bad thing if it's only a moderate decline.
It makes your manufacturing sector stronger as more people will buy from you again due to cheaper prices. It decreases the USD's puchasing power
making it more expensive for American's to travel abroad and take more "Local" vacations. More consumer vacationers will be coming to your stores
and shopping malls. The moment the CND Dollar hits par with the USD, there will be a wave of shopping heading down south for good deals.
Opposite is true with a High Canadian Currency.
It's a double edged sword really, it really hurts exporters and manufacturing as well as tourism. It also causes more and more Canadians to go south
of the border to shop for deals. The "plus" side is that it makes our Natural resources much more profitable and our currency usually only rises
when Resource demand is high. Funny that eh? USD plummets as well due to their dependancy on foreign natural resources(not just Oil either)
It all hinges on how low it goes. If it goes low enough and the Chinese currency goes high enough it could cause a wave of reverse out-sourcing to
your country. It's the volatile nature of the beast, a savage, ruthlessly self-correcting, beast. The beasts name is Capitolism. Try to tame the
beast and you get burned as is evident in the USA right now and in the near future. Go with the flow and try to follow it the best you can is really
the only option.
I'm not saying things will be all peaches and cream 10-20 years now, living will still be a challenge like it always has been, just this time more
people than usuall will be challenged in the short term. Hopefully, if your country is smart, will adapt. If it doesn't, then it will fall and
splinter and another superpower may take it's place eventually, perhaps China, perhaps not if they can't adapt either. Living in a city with
extensive mass transit is a very good way to insulate yourself as much as possible, but in some ways, it the impact is unavoidable. We may have to
give up a lot of our favorite exotic foods because the cost of transportation will exceed the cost of producing the actual food and Local agriculture
will fluorish in responce.
The road is clear, we just need those Soccer moms to start selling their SUVs for Scrap metal to get some changes in how we treat transportation of
everything as a whole. It's difficult but not out of reach.