I have not yet become a snowbird, that strange avian breed which (once having entered 'advancing years') heads south sometime in November only to return in April. Snowbirds have developed an odd aversion to the colour white and to temperatures lower than approximately 10 degrees Celsius. Who can blame them? When North America was divided, the rebel Yankees knew a good thing when they saw it and took the lower half for themselves. Had the division been vertical, perhaps we Canucks could have owned the entire East Coast...so we'd have everything from the Manitoba border to the Atlantic Ocean all the way down to the Florida Keys. Imagine! New York, Boston, Chicago, Atlanta, Savannah, Miami...wow! But I digress. I only alluded to snowbirds because they're wailing about the 78-cent Canadian dollar. That $5 breakfast at the IHOP has become $6.50 for no other reason than some Saudi Arabian oil sheiks opened the petroleum tap, thereby halving the price of a barrel of oil. Besides, New York would probably look a lot like Yellowknife if Canadians had been in charge anyway!
As the warm snowbirds weep, we still frozen Canucks foolishly celebrate $50 fill-ups at the pump as Americans can't make enough Ford F-150 trucks and 8-cylinder gas guzzling SUVs - the demand for them is epic. But, then again, American lettuce is still selling for a buck at Publix in Fort Lauderdale and flat screen TVs are just $99 at Best Buy in Miami. Why is that same head of crispy green vegetable twice the price at Loblaw's? And we have Best Buy too...so, where are the $99 TVs? Simple. The U.S. dollar is strong while the poor loonie has been decimated. So, we get to pay for the lettuce they grow in California, the picking and transportation process, and warehousing it with our 80-cent loonies while Americans still use their greenbacks which have firmed in value rather than being buffeted by the oil 'crisis'. Our American cousins...you know, the ones with the junk banking system...have wrestled unemployment down into the 5.6% range. They've got their annualized GDP growing at numbers in the 4-5% range. Household debt is down. And what do we frozen Canadians do? We bemoan our reliance on that black goo forced out of an unwilling tundra-like landscape in Alberta. Over 30% of our stock market issues are energy-related. Diversification my ass!
The thing about having the stuffing knocked out of our economy by some middle eastern kingdom that, by accident of birth, sits atop the cheapest, best sludge anywhere is that it gets on my nerves. It demonstrates how un-independent we Canadians and our economy actually are. We don't really make much happen, despite our G8 status. We are people who allow others to make things happen to us! Some Canadians may prefer a weak dollar. Investors holding American stocks are not complaining. But, as you contemplate travel abroad this summer, keep in mind that it will cost over 25% more than it might have, had you taken the same trip last year. But one-off "me" stories are so typically Canadian...and so is the abject lack of any actionable strategy on the part of our leadership. They're exactly like the guy we all know who put every penny into Nortel stock 20 years ago and stayed until the bitter end.
Exporters, manufacturers and service providers selling into the United States think this low dollar development is fine. But anyone buying finished goods does not. Strange how we can live in a country that easily sells the ore that makes the copper circuit boards or the trees used for the panelling or the steel used in automobiles...but by the time these finished products return and are presented to us for purchase, the price has dramatically risen because of the exchange rate.
WARNING!!! Don't listen to what politicians say - it's bogus. They don't actually know anything so the nonsense they spout is about as valuable as white noise. I should know...I was one! They have exercised no real control over any of this, so we can assert that, effectively, they and our economy are 'out of control'. Why? Because, as a country, we rely largely on our natural resources and we are told to celebrate that. But, when a bigger player like Saudi Arabia gets tough, it can bankrupt Alberta and push that much vaunted election-year federal surplus we were being promised 'way into the future. And that's what is happening...with the final chapter still to be written.
Here in Ontario, the epicentre of the so-called 'economic engine of Canada', we languish with a 7+% unemployment rate. We fret whenever we lose even a single company or when we see one struggling (Nortel; Blackberry; Target). We have no visible strategy to reverse our fortunes and we put people in charge of crafting our fate who can talk a good game but play politics when they tell us we are supposed to rejoice in the social web we've been given and cherish our 'great' health care system. In fact, the cupboard is bare and paying for this crap is a stretch at best and may soon prove to be impossible. We, in Ontario particularly, and in Canada generally, can and should be doing better. Leaders want credit. Fine. If you are prepared to take credit, you must also accept responsibility. Oil isn't cutting it for us and you ought not to be waiting for the Kingdom of Saudi Arabia to change the rules so that you can point to a rising petrodollar and claim you got it there...instead, you should be devising an economic development plan that attracts a broad range of industry, business, tech/R&D, and economically stimulating activity like developing untapped resource treasures in the Ring of Fire, lest you wait for a 50-cent dollar to make you the real loonies!
Peter
