Personal Finance

Buying USD Makes Sense..?

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  • Mar 11th, 2011 7:59 am
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Sr. Member
Aug 9, 2007
589 posts
10 upvotes

Buying USD Makes Sense..?

With Canadian D over USD Does it makes sense buying USD and hold for now ?
19 replies
Banned
Sep 22, 2008
8322 posts
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unless you want to lose your panties. :facepalm:

you do know the usa is just printing money non stop.
Deal Addict
Mar 2, 2005
2032 posts
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packardbell wrote: unless you want to lose your panties. :facepalm:

you do know the usa is just printing money non stop.

I think that is the general consensus at this point. Company's exchange broker calls me every few days asking if I need USD, I think USD is in the "sell" mode and is predicted to lose even more value during the next few months.
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Sep 26, 2007
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SC
hard to say, if anyone knew with precision they would leverage a position and trade on it.

my gut feeling is the canadian dollar will keep rising, it's also something i fear.
"We don't have a soul... We are a soul. We have a body." ~C.S Lewis
Sr. Member
Feb 1, 2010
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xlfe wrote: ....my guy feeling...

I'm more interested in your gal feeling.
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Sep 26, 2007
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quatchi wrote: I'm more interested in your gal feeling.

me too :lol:
"We don't have a soul... We are a soul. We have a body." ~C.S Lewis
Banned
Mar 2, 2011
90 posts
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Toronto
My gay feeling is that Canada will start printing money very, very soon, so maybe buying up US dollars at 1.1 would be a good idea.
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Mar 2, 2005
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xlfe wrote: hard to say, if anyone knew with precision they would leverage a position and trade on it.

my gut feeling is the canadian dollar will keep rising, it's also something i fear.

Very well said, exactly my thoughts.
Sr. Member
Feb 1, 2010
872 posts
173 upvotes
xlfe wrote: me too :lol:

aww, you edited your post :(



IMO, a case could be made for either a stronger or a weaker CDN$. That's probably why it's where it's at. Sorry if my opinion doesn't help you make bucks on a trade, but anything else is a guess.
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Feb 15, 2008
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Calgary
My view is that a Canadian housing crash is going to cause the CAD$ to spike enormously. Why? Because the average man on the street will stop spending money on imported goods.

Every time somebody buys imported goods, they're buying XXX/CAD currency, ie: they're shorting the Canadian dollar.

When people stop buying, ie: importing (cuz heaven knows, we make practically nothing in Canada), wham, the dollar will shoot up, coincident with a housing crash.

This will continue until either a) the CMHC payouts start flowing in earnest from the defaults, and/or b) the BoC and the Canadian government introduce quantitative easing, much like in the USA.

Lower interest rates are on the way, IMHO, but they won't do much, if anything, to stem the dollar's rise.
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Jan 5, 2009
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Ottawa
Mark77 wrote: My view is that a Canadian housing crash is going to cause the CAD$ to spike enormously. Why? Because the average man on the street will stop spending money on imported goods.

Every time somebody buys imported goods, they're buying XXX/CAD currency, ie: they're shorting the Canadian dollar.

When people stop buying, ie: importing (cuz heaven knows, we make practically nothing in Canada), wham, the dollar will shoot up, coincident with a housing crash.

This will continue until either a) the CMHC payouts start flowing in earnest from the defaults, and/or b) the BoC and the Canadian government introduce quantitative easing, much like in the USA.

Lower interest rates are on the way, IMHO, but they won't do much, if anything, to stem the dollar's rise.

The US Fed cant go lower and MarK Carney is not lowering interest rates.
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Feb 15, 2008
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MarcFromOttawa wrote: The US Fed cant go lower and MarK Carney is not lowering interest rates.

Oh we'll see about that...
TodayHello wrote: ...The Banks are smarter than you - they have floors full of people whose job it is to read Mark77 posts...
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Sep 26, 2007
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Mark77 wrote: My view is that a Canadian housing crash is going to cause the CAD$ to spike enormously. Why? Because the average man on the street will stop spending money on imported goods.

This only makes sense if everyone is in the poor house. Otherwise it just doesn't make sense, the average guy would import if it made financial sense to do so, and it's not hard to imagine he would given a spike in CAD.
"We don't have a soul... We are a soul. We have a body." ~C.S Lewis
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May 17, 2009
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namhcaeb wrote: My gay feeling is that Canada will start printing money very, very soon, so maybe buying up US dollars at 1.1 would be a good idea.

1.1? What's your timeframe on "very, very soon"? I don't see us hitting 1.1 (if we do) for many months, and more likely over a year. My viewpoint is not fundamental (most of the economists on this forum take this side of it), but instead technical. Those levels from what I see are not going to be hit soon. CAD needs a retrace back to at least 0.9850 before making another leg down; there is too much trending for the loonie right now. I'm currently LONG USD/CAD with TP indicated at my expected retrace value.
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Dec 23, 2005
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What about oil? If oil crashes like before 1 CAD will be 0.8 USD. Do you think it can happen?
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Mar 19, 2007
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I don't think there will be a oil crash but a correction eventually since high oil price is really bad for the global market. I don't think CDN will hit 1.1 but will stay above parity for quite a while.
Jr. Member
Mar 2, 2011
190 posts
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Richmond Hill
As an economic indicator, forums like these are very valuable. When everyone and their dog "knows for a fact" that the USD will crash, that usually means that it's time to start buying USD. These same fools were the ones who were buying oil at $150 in 2008. It's the same people that get taken to the cleaners time after time, and those of us who know how to intelligently be the contrarian investor make excellent profits.

I guarantee the average person who "knows" the USD is going to crash is going to say something like "well, the US is printing so much money" and that's about it, without any consideration to context or relativity. Yes, the US is printing a lot of money, but, news flash, so are all the other major economies (EU, Japan, UK...no, the Yuan is NOT a major currency yet). Because the USD is prices RELATIVE to these currencies, it's poor monetary and fiscal policies will not "crash" it, because all the other ones are doing the same.

With regards to the US debt, and US deficit, yes it is high as an absolute number, but absolute numbers don't mean anything when taken out of context. You need to consider the huge size of the US economy as well. The US economy is large enough to support that activity. No, it's not a good thing. But it's not the end of the world as some people suggest.

The US debt, and deficit have both been at higher levels RELATIVE TO THE SIZE OF THE ECONOMY, which is the only thing that truly matters. So if the debt and deficit have been at higher levels before, and the world hasn't ended, I don't see why it has to end now. As for the printing of money, they are not literally printing bills non stop and then sending them out into the world. They are monetizing the debt by buying US bonds (QE II). However, the vast majority of the newly created money is locked up in banks, and not actually entering the money supply. And the money supply is not a permanent thing that, once done, cannot be undone. When the time comes, there are measure that can and will be taken to squeeze the excess liquidity out of the system.

So when it seems like guy who takes your order, or drives your cab, or posts on this board are all saying something like "the USD si going to crash!!...Buy gold, and make sure you're shelter is stocked with canned goods and bottled water!!" smart investors know that it is probably a good time to start buying.
Jr. Member
Mar 2, 2011
190 posts
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Richmond Hill
nyxeus wrote: I don't think there will be a oil crash but a correction eventually since high oil price is really bad for the global market. I don't think CDN will hit 1.1 but will stay above parity for quite a while.

A whole lot of the current oil price is built in spec about middle east tensions. If a resolution comes about that does NOT severely disrupt production capacities, then yes, oil will likely crash to around the $70-$80 range. Personally, I think this is likely. As well, don't forget that Japan is the 2nd largest importer of oil in the world (4-5 million/bbd). That earthquake today will likely put a pretty large dent in Japan's demand for the short term....and of course, we all know the short term is all that matters when it comes to oil.

With regards to the earlier poster who wondered if now was a good time to buy USD/short CAD with the CAD at about $1.02, for what it's worth, that is exactly what I'm doing.

Edit: I should qualify that if Saudi Arabia starts to get serious protests, and starts to look even a hint of serious production disruption there, then all bets are off.

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