Comments on: A Diving Loonie? http://www.canadiancapitalist.com/a-diving-loonie/ Helping you invest and prosper Sat, 11 Feb 2012 12:40:17 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: W.D. http://www.canadiancapitalist.com/a-diving-loonie/#comment-70333 W.D. Sun, 07 Oct 2007 22:57:40 +0000 http://www.canadiancapitalist.com/2006/11/09/a-diving-loonie#comment-70333 Well, the Canadian dollar has continued to climb during 2007 and Canadian Manufacturing jobs continue to decline. The manufacturing company I work for sell mostly to the U.S. because of the lower value of the U.S. $ the company's profit margin suffers (the product still gets sold for the same U.S. $ value) So, a stronger Canadian dollar may make for more trips to the U.S. it hurts Canadian Manufacturers. Weired isn't it! Well, the Canadian dollar has continued to climb during 2007 and Canadian Manufacturing jobs continue to decline. The manufacturing company I work for sell mostly to the U.S. because of the lower value of the U.S. $ the company’s profit margin suffers (the product still gets sold for the same U.S. $ value) So, a stronger Canadian dollar may make for more trips to the U.S. it hurts Canadian Manufacturers. Weired isn’t it!

]]> By: Phil S http://www.canadiancapitalist.com/a-diving-loonie/#comment-11852 Phil S Sat, 11 Nov 2006 03:53:38 +0000 http://www.canadiancapitalist.com/2006/11/09/a-diving-loonie#comment-11852 I currently work for a japanese automaker and they chose to expand their operations in Canada during the time when the loonie was at 90 cents! Companies which rely on cheap labour (such as in clothing and textiles) will continue to leave Canada regardless of where the loonie goes. Any manufacturer which can successfully demonstrate added value has the profit margins which are not as susceptible to currency fluctuations because customers are willing to pay more for their product. The problem is that our tax structure here in Canada doesn't allow companies to spend money on innovation. So, all of our R&D and innovation is done in japan and gets shipped over here and we're mainly the grunts who just build stuff because we're physically closer to the raw materials. I don't know if any of you have tried to file paperwork for the R&D tax credit before, but by the time you meticulously file everything to apply for the credit, the manhours involved to file the paperwork has pretty much wiped out whatever meagre credit that corporations get back on their taxes. Our corporate tax laws need a serious restructuring and the income trust fiasco is just a symptom of the root cause of our dilemna. We're all over-taxed! I currently work for a japanese automaker and they chose to expand their operations in Canada during the time when the loonie was at 90 cents! Companies which rely on cheap labour (such as in clothing and textiles) will continue to leave Canada regardless of where the loonie goes. Any manufacturer which can successfully demonstrate added value has the profit margins which are not as susceptible to currency fluctuations because customers are willing to pay more for their product.
The problem is that our tax structure here in Canada doesn’t allow companies to spend money on innovation. So, all of our R&D and innovation is done in japan and gets shipped over here and we’re mainly the grunts who just build stuff because we’re physically closer to the raw materials. I don’t know if any of you have tried to file paperwork for the R&D tax credit before, but by the time you meticulously file everything to apply for the credit, the manhours involved to file the paperwork has pretty much wiped out whatever meagre credit that corporations get back on their taxes.
Our corporate tax laws need a serious restructuring and the income trust fiasco is just a symptom of the root cause of our dilemna. We’re all over-taxed!

]]> By: MikeB http://www.canadiancapitalist.com/a-diving-loonie/#comment-11821 MikeB Fri, 10 Nov 2006 19:37:20 +0000 http://www.canadiancapitalist.com/2006/11/09/a-diving-loonie#comment-11821 This will likely prop up the loonie. http://edition.cnn.com/2006/BUSINESS/11/09/china.economy.reut/ This will likely prop up the loonie.

http://edition.cnn.com/2006/BUSINESS/11/09/china.economy.reut/

]]> By: MikeB http://www.canadiancapitalist.com/a-diving-loonie/#comment-11756 MikeB Thu, 09 Nov 2006 21:47:52 +0000 http://www.canadiancapitalist.com/2006/11/09/a-diving-loonie#comment-11756 JPMorgan probably has an axe to grind with the boogie man finance minister. JPMorgan probably has an axe to grind with the boogie man finance minister.

]]> By: tintin http://www.canadiancapitalist.com/a-diving-loonie/#comment-11751 tintin Thu, 09 Nov 2006 19:55:09 +0000 http://www.canadiancapitalist.com/2006/11/09/a-diving-loonie#comment-11751 A currency is a common share of a country. A falling currency indicates problems with a nation. And eventually a falling standard of living. A currency is a common share of a country. A falling currency indicates problems with a nation. And eventually a falling standard of living.

]]> By: Canadian Capitalist http://www.canadiancapitalist.com/a-diving-loonie/#comment-11747 Canadian Capitalist Thu, 09 Nov 2006 17:28:50 +0000 http://www.canadiancapitalist.com/2006/11/09/a-diving-loonie#comment-11747 A falling loonie would give a breather to the manufacturing sector. I have a high exposure to international equities, so a falling loonie would be good for my portfolios. A falling loonie would give a breather to the manufacturing sector. I have a high exposure to international equities, so a falling loonie would be good for my portfolios.

]]> By: tintin http://www.canadiancapitalist.com/a-diving-loonie/#comment-11741 tintin Thu, 09 Nov 2006 16:39:00 +0000 http://www.canadiancapitalist.com/2006/11/09/a-diving-loonie#comment-11741 From the Globe article: "The Canadian dollar is expected to slide next year as the U.S. economy slows and foreign investors lose interest in the wake of a recent decision to tax income trusts" This is enough to devalue the CAD by 8-10% ? The rising CAD affect manufacturers. So the CAD should fall to make jobs for this segement? From the Globe article:

“The Canadian dollar is expected to slide next year as the U.S. economy slows and foreign investors lose interest in the wake of a recent decision to tax income trusts”

This is enough to devalue the CAD by 8-10% ?

The rising CAD affect manufacturers. So the CAD should fall to make jobs for this segement?

]]> By: Big Cajun Man http://www.canadiancapitalist.com/a-diving-loonie/#comment-11736 Big Cajun Man Thu, 09 Nov 2006 13:40:42 +0000 http://www.canadiancapitalist.com/2006/11/09/a-diving-loonie#comment-11736 It may also help companies that rely heavily on exports to the U.S. or that have split work forces over many countries. Right now Canadian Workers are expensive in comparison (which is never a good thing). --C8j It may also help companies that rely heavily on exports to the U.S. or that have split work forces over many countries. Right now Canadian Workers are expensive in comparison (which is never a good thing).
–C8j

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