The way back is the way forward

The saying goes that those who forget history are doomed to repeat it. To that I would add: or to forget how to. History can be a liberation.

I read a column today in The Globe and Mail... I forget who it was by, but the gist of it was a maudlin retreading of that tired old saw that it really didn’t matter how right we might be doing things in Canada, we’re joined at the hip by Fate to the United States and we’ll only be as well as it is sick.

Is that what we fought for as separate colonies in two continental wars? Is this why we finally came together to forge a new nation and common nationality a hundred and forty years ago? To imagine we have no future, no destiny, but that of the nation we’ve had to work so hard to remain distinct from?

A couple of weeks ago, I was in a used bookstore in rural Ontario. I came across a nice softcover book of Ontario’s history from 1610 to 1985. For the past week or so I’ve been reading it about half an hour in the mornings. And I came across some figures that were truly eye-opening.

In the middle of the 19th Century, before Confederation, the United Province of Canada (what had been Upper Canada and Lower Canada, and would become Ontario and Quebec respectively in Confederation) had a reciprocity agreement with the United States. Partly because they were sore at Britain for its conduct during the Civil War, and partly because they believed Canada’s separation from the US and adherence to the British Empire “unnatural” and only encouraged by reciprocity, the US unilaterally terminated the arrangement in 1866. And do you know what happened?

Canada promptly and obligingly curled up and died. Right?

Wrong.

Canada found other markets. And prospered.

In an age before the first prop-engine freighter ever took the skies, before refrigeration and air conditioning, when rail and sail were still the only ways to get it from here to there, this country (or what was to become this country) turned away from the easy, lazy continental trade we’ve decided is the centre of the universe, and actually hustled and found markets elsewhere.

In 1870, 51% of all Canadian exports were going to the US, and only 38% was going to the United Kingdom (the balance going pretty much to the rest of the Empire). But by 1916, 61% of our export trade was going to the UK and only 27% to the US. Even by 1937, the figures were about even: 41% to the US and 38% to the UK.

Now I’m not suggesting we can simply fall back on Mother England as our alternate to trade with the United States. But let’s remember... there’s a whole lot more to the world than just the United States, and if they’ve been rich and they’ve been close-by, that’s been convenient. But times change, and as they did before, so we must adapt. Our own history shows us what’s possible. If they could do it back then, with the incredible obstacles that time and distance represented for them, what right have we to fall back whining that the end of all good things is upon us? The EU is well-heeled, has nearly twice the number of consumers as the US, and looks upon us favourably (seal-clubbing notwithstanding; and we'll reserve comment here on fox hunting and bullfighting). China, India, and even much of South America are on the rise. These are places that will need our resources and can easily absorb the excess manufacturing output of a relatively smaller nation like ours. What I mean is, it really wouldn’t take that much of the world to pick up the slack the US is leaving behind for a country the size of Canada – if we’ll just get up off our asses and get in the game instead of moaning on the sidelines.

We did it before, and we can do it again. By all means, let’s wish the US well, but let’s not consign ourselves to the role of some Roman slave obliged to open his veins to share the fate of a humbled master. We have our own national life to lead, and our own stars to follow.

After all, wasn’t that the point in 1776, 1812, and 1867?

Chapters in a Bullshit Story

A couple of weeks ago, I blogged about wanting to buy a book on camera RAW processing at Chapters, and the issues I had with the price. Well, I did something about it. I ordered the book from Amazon instead.

I ordered the book on Monday. It arrived today (Wednesday). Just two days to get here. Okay, it's not the instant gratification of snagging something off the shelf, but given that I waited two weeks to order anyway, two days' delivery time is just fine with me. Better than I hoped for, in fact.

Here's the big punch, though. Chapters wanted $47.99 for the book. Amazon wanted $30.23. That's less than the US price (more on that in a second). We're expected to pay Chapters an extra 18 bucks — nearly a 60% premium — just to stick this thing on a shelf? So I ordered it, and with the savings, I ordered another book, this one about photographic composition. With tax, buying the book at Chapters would have cost me just over $50. Buying two books from Amazon, shipped for free in two days, cost me just $5 more. I got the second book for five bucks... effectively, for free.

When I was in Chapters that day, really, I just wanted my money's worth. I wanted to pay the US price, $39.99. The Canadian dollar right now is worth 99.15¢ US. That's essentially par. And it has been more or less at par with the US dollar for around a year now, when it started routinely hitting over 95¢ US last May. So all this garbage the bookstores are giving us about old copies having old prices is wearing real, real fucking thin at this point. In fact, it's out and out bullshit: the book I bought about camera RAW... I checked; it has a copyright date of 2008. So this is not an old copy. This out outright gouging. Why, with a Canadian dollar worth 99% or more of a US dollar, am I being expected to pay a 20% premium as though my dollar were worth 83¢? Who pockets that difference?

Well, you know what? Maybe Chapters doesn't value the Canadian dollar, but as a guy who gets paid in them, buys with them, lives by them, I sure the hell do. And that's why Chapters ain't gettin' any more of mine.

Hit the road, Jack, ...something something photo track...

My GiSTEQ PhotoTrackr has arrived! It's a neat, inexpensive little device that corresponds frequently with the GPS and logs your position as you move. When you get home, its software matches up the log and the timestamps of your photos and then embeds the geographical location in the metadata of the image. This is called "geotagging".

I got the unit at a bargain price on eBay… a bargain because at the time I ordered it, the Canadian dollar was worth $1.08 US. I wanted it for a couple of reasons. Firstly, I wanted to be able to look back in the future a know just where I was, to within a few yards, when I took a particular image. Second, since I'm hoping to start recording the city (especially in 3D) for people in the future, it's important they be able to tell exactly where a photo was taken, especially if the location changes a great deal.

It happened on Halloween

The Canadian dollar topped its record late this afternoon, just a couple of hours ago. It was worth more than it's ever been during the lifetime of anyone alive today.

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Oct. 31 (Bloomberg) -- Canada's dollar rose to an all-time high against its U.S. counterpart as record crude oil prices and the Federal Reserve's cut in borrowing costs spurred a rally in currencies linked to commodity exports.

The difference between Canadian and U.S. benchmark interest rates was erased for the first time since March 2005 when the Fed reduced its target for overnight lending between banks by a quarter-percentage point to 4.5 percent. The U.S. dollar tumbled against more than a dozen major currencies as the Fed's cut fueled speculation that the global economy will weather an American housing slump.

"We can't call a top in the Canadian dollar,'' said Steve Butler, director of foreign exchange trading in Toronto at Scotia Capital Inc.

Canada's dollar rose 1.2 percent to $1.0604 at 4:55 p.m. in Toronto after touching $1.0617, the highest since the currency started floating in 1950. One U.S. dollar buys 94.31 Canadian cents. The Canadian currency's previous high of $1.0614 was reached in 1957.

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TORONTO, Oct 31 (Reuters) - The Canadian dollar rose to its highest level in nearly 130 years against the U.S. dollar on Wednesday, hitting US$1.0617 as the greenback slide lower in the aftermath of a U.S. Federal reserve rate cut.

The domestic currency has rallied sharply in recent months, thanks to lofty commodity prices, a broadly weaker U.S. dollar, merger-related interest and a robust Canadian economy.

At about 4:15 p.m. (2015 GMT), each U.S. dollar was worth 94.19 Canadian cents.

The smaller dollar

According to the Bank of Canada, the day I started City in the Trees, May 16, 2005, the Canadian dollar was worth 79¢ US. If you had bought something worth a dollar Canadian with a US dollar that day, you would have gotten 26¢ in change (Canadian).

All my life, at least all my economically-conscious life, the Canadian dollar has been worth less than the US dollar. There've been certain advantages to it; it's tended to be good for exports because it made our commodities less expensive to everyone else (in particular, people in the US)... but it had a couple of downsides. First of all, it made it things here more expensive, and that meant that we had to live just a little meaner than our neighbours, through no fault of our own. Secondly, it was faintly humiliating. Who could forget when our dollar was worth 62¢ US just five years ago? Odds are, it will be worth less than the US dollar again, but for the moment... just for the moment... I can think back to when a friend visited from Los Angeles in the mid-90s. He came ready for every contingency implied by crossing the border; he even wanted to know if he had to bring adapters for his electrical appliances (the answer: no). But he could not be bothered, absolutely couldn't be bothered, to change one red cent US to Canadian currency. He simply took it for granted that people here would treat his money as legal tender in a foreign land; indeed, would be damn glad to have it and welcome it in preference to our own. I never said anything to him, he was a guest, but I found his attitude arrogant and insulting... and the thing is, I knew even if I had raised it as an issue, he would simply have thrown the value and international stature of his currency right in my face... he was that kind of guy, unfortunately.

(Allow me to quickly add here that of the several visitors I've had from the US since, not one has had that attitude or come without at least some Canadian money at the ready.)

Well, I've lived long enough to see my dollar raise its head above that waterline and finally take a breath. I don't know how long it'll last, but I did see it. Just a few moments ago, I noticed our dollar trading, momentarily, above $1.05 US. Today, our dollar broke the record it set against the US dollar in 1974, and is worth as much as it was in 1960: in other words, it's worth more than it's ever been worth in my entire lifetime, measured against the US dollar. And how I would have loved to have had that smug Los Angeleno with me on Saturday. I was with P-Doug and MG down at a new Chinese supermarket called T&T at the lake front. As we went through the checkout, I happened to notice pink cards they'd put up at every register, announcing they were accepting US dollars at 90¢. I couldn't help smiling as I tried to imagine his face. Damn, but that felt good.

It won't last... but just for a few moments, this is ours.

Bang. Zoom.

Today is epochal. I don't know if most people will see it that way, but I think today, Sept. 20, 2007, is going to go down in financial and social history. This very day, we have seen some startling indicators concerning the health of the US dollar and, by extension, the economy it represents.

Today, the Canadian dollar hit parity with the US dollar. The last time that was true was November, 1976, when I was still shedding milk teeth. This is partly due to rising commodity prices, which favour our dollar since we export commodities (particularly oil), but also an indicator of the tight monetary policy the Bank of Canada has followed for many years finally paying off. It's also due to the housing melt down in the States, and other factors undermining the US dollar.

Today, the euro hit $1.40 US for the first time since its creation in 1999 and implementation in 2002. Many people were saying that this was a psychological barrier the euro had to hurdle to be taken seriously as a potential reserve currency. It would seem that the euro has arrived. If this is seen to be the case, this will put even more downward pressure on the US dollar.

Today, for the first time, Saudi Arabia has declined to lower interest rates in lockstep with the US Federal Reserve. There's speculation that this is the first step to the Saudis unpegging their currency from the US dollar, and that may ultimately signify they're preparing to abandon their support for the policy of accepting only the US dollar in payment for oil. It's Saudi Arabia who has driven that policy in OPEC for over 30 years, and what has effectively backed the US dollar ever since. If this changes and oil becomes available on the open market in a basket of currencies, the days of US dollar hegemony will truly be over. What's worse, the US currency frozen in reserve banks around the world may become liquid again, and the value of the US dollar could truly plunge if that happens.

On the surface, it looks like just a couple of little incidents... but when you look at the big picture, it was a sobering day for the US economy, and the prognosis isn't a happy one. Today may turn out to be one of those days that the world changed while we were all too busy to notice.

A (US) dollar saved is 70¢ earned (2002 vs. 2007)

Every few years or so, we get treated to another dose of this...

Dodge says single currency 'possible'
BARRIE MCKENNA
May 22, 2007

WASHINGTON -- Bank of Canada Governor David Dodge says North America could one day embrace a euro-style single currency.

But to get there, Canada, the United States and Mexico must first tear down barriers to the free flow of labour, which he pointed out yesterday have "gotten a bit thicker" in recent years...

The idea of a common currency has long been a subject of curiosity, particularly among Canadian academics, who see it as a way to escape sharp gyrations in the exchange rate.

The recent surge in the Canadian dollar to a 30-year high against the U.S. currency makes Canadian products a lot less competitive in Canada's major foreign market. The high loonie also makes Canada a more expensive tourist destination.

Some proponents have dubbed the single North American currency the "amero."

It is more likely, however, that a common currency would mean that Canada and Mexico would adopt the U.S. dollar, giving up significant economic control to a central bank dominated by the United States.

The last time this came up, and in a big way, was five years ago when our dollar tanked at just under 62¢ US. But you know what I've noticed? For some people, the advantages never matter. Only the downside. Back then, it was how Canadians couldn't go abroad, couldn't buy from foreign countries, our companies were getting bought out from under us. Now you would imagine that as our dollar appreciates, those negatives would suddenly be positives: we can afford to go abroad, buy what we want, guard our own companies and maybe start buying up someone else's, but no. No, it's still all bad news, but from the opposite end. Now it's hard for us to sell abroad, now our domestic goods are being out-competed by cheap foreign ones, now Canadian investment is bleeding to other shores (of course, the corollary of all this back a few years ago was that our exports were beating the pants of everyone else's, domestic products were favoured, Canadian investment stayed in Canada and foreign investment poured in...). Jesus, you can't win. And you know why? Because there tons of douche bags in this country who simply get hard at the idea of us joining the United States, always have and always will, and they'll paint any picture in whatever shade of black they have to to make that seem inevitable, and hang it upside down the minute it makes sense to; whatever it takes.

It's all bullshit.

Why on Earth, now of all times, would we even consider hitching our wagon to the American star(s)? For the first time in decades, our trade with them is down and the EU is nicely taking up the slack, ameliorating that terribly large egg in just one basket we've had for far too long. Their economy, largely fueled by $2 billion of foreign borrowing a day and a hideously overinflated speculative housing market, is slowing down in ways not reflected in ours; these same practices are what's propping up their dollar, but the leaks seem to be spring up faster than they can be patched. We have a trade and budgetary surplus; they have monstrous trade deficits and a national debt that will likely approximate $10 trillion by the time Bush heads off to hunt armadillos with Barney for good. You might as well offer to have your circulatory system knitted to that of a 500 lb. guy in need of a quad bypass but no money to pay for it, who's constantly reaching into your wallet to order a meat lover's pizza. Yeah, if you don't care that your life savings will evaporate before your very eyes as other countries flush increasingly huge volumes of up-till-now hidden US assets from their central banks as the rot really sets in, then by all means, be my guest. Just don't ask me to do the same. You go trade your Canadian dollars for US ones; I'll hold onto mine, thank you very much.

The euro makes sense because it's centred on four or five countries of roughly the same size, social policies, wage scales, and economic oomph. There's no such parity in North America on any of those matters. Canada matched to the US alone would not survive in the way Portugal can linked to France, Germany, Britain, and Italy. And there's no way the Americans would yield the kind of sovereignty to a supra-national body required for us to defend ourselves in the way the Europeans have. So it's not on. We swallowed NAFTA, and what do we get? "Do as I say, not as I do." Rules are for everyone else, not Americans. Fine, this far and no farther.