[movermike] movermike: Curency Moves Have Consequences!

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Posted by movermike:
Curency Moves Have Consequences!
http://www.movermike.com/posts/1195071370.shtml


   The USD hit a new low this week, 75, which is down from 121 in 2001 or
   38%. Moves of this magnitude have consequences. We may find that
   foreigners who hold our currency will tire of the losses and sell,
   causing our interest rates to rise and imported goods to be more
   expensive.

   Currency moves have other effects. Take for example the news that
   "contemporary case goods specialist [1]Baronet has closed its doors, a
   victim of a weakening retail environment throughout North America and
   a surging Canadian dollar."

   [25_023.jpg]

   Baronet has been in business for 65 years and has 145 employees.

     âAfter operating at a loss for nearly two years and despite added
     productivity from business restructuring efforts, Baronet Inc. and
     Baronet USA have been forced to seek protection under the
     Companiesâ Creditors Arrangement Act,â the company said in a
     statement. The CCAA is Canadaâs counterpart to the U.S. bankruptcy
     code.

   I remember vacationing in Vancouver and Victoria, BC when I was 14.
   The Loonie was 108 to the dollar. I remember that tourists from Canada
   could use their currency in place of ours when they shopped. I recall
   the time when stores changed their policy and would not accept
   Canadian currency. That was when the Loonie was down around 60 to the
   dollar. It was a great time to visit Canada, everything was on sale to
   an American. Here I am on the verge of 64 years old and the Loonie is
   about even with the USD once again.

   I suspect that we will see more filings like this in Canada, in Europe
   and in Asia, and retaliation on the part of foreign governments to
   protect jobs in their countries. Where have the U.S politicians been
   to protect our jobs?

   [2]USD [3]Baronet [4]Mover Mike

References

   1. http://www.baronet.ca/en/homepage.php
   2. http://technorati.com/tag/USD
   3. http://technorati.com/tag/Baronet
   4. http://technorati.com/tag/Mover+Mike