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Loony loonie
Anybody who trades forex has probably been amazed by the rise and fall of the Canadian dollar. Of course, no one can be absolutely certain the value of the U.S. dollar has bottomed or that the C-dollar has put in a historic top, but evidence is picking up to indicate that's the case, and the dollars may end up at par. Wonder how long it will take marketing people to adjust the two-tier pricing for a lot of products -- for example, a magazine I got the other day has a cover price of "U.S. $6.95, Canada $8.95." Oops . . .
The U.S. Dollar Index has a lot of ground to make up to confirm it has put in a bottom, but if a bottom is in, it could have a lot to do with the outlook for the price of gold, oil and a number of other commodities. Gold has backed down from its assault on its $850 record, crude oil has slipped in its attempt to reach $100 . . . copper, often viewed as a gauge of the economy, is now suggesting either the U.S. dollar decline may have ended or the U.S. economy is really weakening -- or both -- by trading below $3 a pound Monday for the first time since last spring.
If there is one thing that does seem like a sure thing in the forex market, it is that the value of the Chinese yuan will rise relative to the U.S. dollar. No less a guru than Jim Rogers said so recently, and judging by the economic growth we've seen firsthand in China, we would have to agree. But be patient . . .
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