Loonie Tunes

There's a lot of buzz in the blogosphere today about the fact that the Canadian dollar this morning finally reached parity with the US dollar. It's a big deal for those of us who used to think of Canada as a cheap place to visit, and I can't imagine it's good news for the Whistler ski resort. But on a macroeconomic level it makes sense, as Stephen Gordon explains today.

For one thing, US interest rates are going down while Canadian interest rates aren't; there's even a chance they might go up. And for another thing, a slowing US economy is much less likely to drag the Canadian economy down with it than it has in the past. Canadian exports to US have been mediocre of late anyway, but more importantly the big Canadian export right now is energy, and oil prices continue to hit new record highs. So it's entirely possible that the US could go into recession without causing any visible harm to Canadian exports.

Meanwhile, the Concatenation of the Day award goes to Bloomberg News, for this:

The Canadian currency last closed above par on Nov. 25, 1976, the day before the Sex Pistols punk band released their first single, "Anarchy in the U.K."