Currencies trade based on similar fundamentals as shares in a public company.  The main difference is that management of the currency is voted in by the citizen rather than the shareholder.  Too much debt, low revenue (GDP), more cash leaving than coming in (negative trade balance/cash flow) and issuing more shares (currency) affect the price of both negatively. Today our currency managers are so out of touch with reality.   

If our government continues to make horrible decisions such as issue stupid amounts of debt, limit our resource sector, increase taxes and government bureaucracy, the Loonie will soon be worth 70 cents U.S.  If Ottawa refuses to react, which is likely under Trudeau, a fall to around 60 cents over the following 36 months is likely. 

A falling currency causes price inflation because it takes more Canadian dollars to import foreign priced goods.   Our inflation rate has soared since the Loonie dropped 5% against the Greenback. It is not only losing value to the US$ but the Euro as well. The latter has increased 9.5% against our dollar over the last year.  This is considered a huge drop for a currency.   The biggest decline has taken place since Trudeau told Germany it would not help the country by selling our natural gas to them because there was “not a business case for it”. Clearly, Trudeau does not know what a business case is and hates this country.    

Every government must always protect its currency and make serious efforts to increase the value of it.  In our case we would do very well with a Loonie at par with our southern neighbors.  This one move will kill inflation and corporate tax revenue will soar because foreign investment will return to Canada. 

Our country’s management strategy is to borrow as much as possible then waste it. Notice no major infrastructure has been built in Canada under Trudeau? They are trying their hardest to destroy our resource sector, the farmer, and do nothing for the healthcare or the military. All the above are a source of business and personal tax revenue that they are restricting.  This aids in a weakening currency. 

If Trudeau and his puppets get re-elected our dollar will hit 50 cents U.S. by 2030.  Canada will become unrecognizable because our standard of living would crumble. Both Trudeau and Freeland do not understand that a weak currency equals a weak economy,  just like a share in a bad company.   Canada has so much potential, but we are led by a group that make zero effort to achieve it.  The Liberals and the NDP are 100% responsible for the weakening Canadian dollar.  

Should we divest from the Loonie?  No.  Current management will be voted out.  It is already decided in the polls. Unfortunately, Trudeau will not call an election even though the world wants him removed.  He will hold out until the bitter end. He loves his tyrant ways and spending your money frivolously.  The day he is gone, foreign investment that took flight once he became CEO will rush back, and if the next management improves Canada’s balance sheet as well as the income and cashflow statement, the Loonie will take off and return to pre-Trudeau levels within a year.