Sunday, November 11, 2007

Exchange Rates

I cannot remember a time when the Canadian dollar was worth more than a US dollar. But today, I was curious about the rate and was shocked to learn that the rate is $1.07 USD to $1 CAD. Wow. What will this mean?

My first thought was that I might need to learn to appreciate American beer since my favorite beer, Labatt Blue, is made in Canada. My second thought was that now probably isnt a good time to visit Toronto. My third thought was that this is probably good for Michigan and the rest of the country too.

You see, a weak dollar means a lot of things. Foreign vacations get more expensive. Flying in water from France gets even more decadent. Basically, imported things become more expensive relative to domestic versions. That will mean higher prices for anything imported. It also means that moving jobs offshore becomes more expensive which means jobs that would have otherwise been lost to foreign competition will remain the US.

Michigan, in particular, probably needs jobs more than it needs cheap crap from China or expensive French cheeses or nights out at the Windsor Ballet.

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