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By Mitch, October 18, 2008 8:25 pm

The Canadian dollar is dropping like a rock! Up until about two weeks ago the C$ and the US$ were trading pretty much at par…so I was able to simplify the pricelist by offering the same price to both Americans and Canadians. No longer. The worldwide financial crisis has pushed the C$ down some 15%, and some analysts believe it won’t come back for quite a while. Here’s what a leading Canadian newspaper had to say about the situation:

“The fundamentals for Canada’s dollar are looking a bit weak. A big part of the demand for Canadian dollars is driven by export earnings, but the two big supports for Canadian exports are both crumbling. Manufactured exports have been shrinking for a while, as the U.S. housing collapse devastated demand for lumber and other building materials, while the emerging weakness in U.S. consumer demand is devastating demand for goods like autos. Add to this the plunge in value of commodities, from petroleum to metals to grains. All these have touched record highs within the past few months and all have fallen significantly from those highs. As the prices drop, Canada’s export earnings decline. According to George Vasic, chief strategist at UBS Securities Canada, the Canadian dollar moves in very close correlation with the price of a basket of commodities representing this country’s pattern of resource exports.”

In response, I am announcing a temporary discount of 10% on any U.S. dollar order placed and paid for before October 31. We will be keeping a close watch on the situation, and MAY continue it into November; but as long as the markets remain volatile, we can make this offer for a limited time only.

Mitch Wapen

www.lofasofa.com