Loonie Gives Canada Something to Crow About The American dollar is now on par with the Canadian dollar, or loonie as it is more commonly called. It is a pivotal moment for Canada — and its neighbor to the south.
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Loonie Gives Canada Something to Crow About

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Loonie Gives Canada Something to Crow About

Loonie Gives Canada Something to Crow About

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The loonies are on the rise. Loonies, of course, being slang for the Canadian dollar. That's thanks to the bird pictured on the currency. For decades, the loonie's been worth much less than the U.S. dollar. But now one Canadian dollar equals one American dollar.

We turn now to NPR's Mike Pesca in New York, which is sort of a Toronto on the Hudson.

MIKE PESCA: A year ago, if a Canadian offered you a penny for your thoughts, you'd have been more than justified and laughing in his frost-encrusted face. Such was the weakness of the Canadian dollar, or the loon, against the American dollar, or the dollar.

But now, the weakness of the American dollar has brought trading levels to an even keel. For the first time in 31 years, the loonie, so named for the waterfowl depicted on the Canadian dollar coin, is worth one dollar American. The tunie, so named for the tuna fish sandwich the queen of England is depicted as eating, is worth two U.S. dollars. You see where we're going with this. A Canadian nickel with a beaver on its back worth the same as an American nickel with Monticello on its back.

One coin shows a work of architectural and engineering genius, which housed the greatest renaissance man this continent has ever known; the other shows a river rodent. And yet somehow they're equally valued.

John Moore is president of the Canadian Association of New York, which today is probably worth the same as the New York Association of Canada.

Mr. JOHN MOORE (President, Canadian Association of New York): For at least my generation, we always knew that something was going to happen. But that happened this quickly, I think it has come as a surprise, but it's come as a very pleasant surprise.

PESCA: Listen to him, the reasonableness fairly dripping from his inoffensive lips. And what exactly is this fifth column they called the Canadian Association?

Mr. MOORE: The Canadian Association of New York is an association that has a rich history, been in New York City for over a hundreds years.

PESCA: Which is like 89 Canadian?

(Soundbite of laughter)

PESCA: But no, those jokes aren't funny anymore, or more accurately put, they're both now unfunny and inaccurate. The strong loon isn't only a story of losers. I mean, there are suddenly wealthy Canadian tourists descending on the U.S. I fear they are already among us. As with any import/export story, dollar parities mean some benefit and some are hurt. But when the countries in question are the U.S. and Canada, all the usual equations come with an asterisk, which to our Canadian listeners is like a maple leaf, only smaller and off to the side.

Mark Chandler, chief currency strategist for Brown Brothers Harriman, points to the interconnectedness of the two countries.

Mr. MARK CHANDLER (Brown Brothers Harriman): Much of what Canada exports are commodities. Most of those commodities are priced in U.S. dollars.

PESCA: One big commodity that Canada exports is oil, but half of the oil flowing out of Canada is already owned by foreign companies. So the strength of the loon doesn't have a huge effect. Add it all up and you come to see why a moneyman like Chandler regards the Canadian dollar as the pair of sensible brown loafers in the currency closet.

Mr. CHANDLER: The sexier markets, the more glamorous markets, would be, of course, the Euro, the Yen and Sterling. A Canadian dollar is sort of a - it tend to be a very low volatile currency.

PESCA: Don't tell John Moore about low volatility. He was jumping out of his skin in his moderate gracious Canadian way.

Mr. MOORE: This is a dramatic event for Canada and for Canadians, and I think we have a lot of nationalistic pride and we're extremely happy that this has happened. And I think it's quite a topic among Canadians.

PESCA: Well, of course it is. Hockey season hasn't started yet, which leads me to a thought. With their currencies at parity, maybe this is an opportunity for the U.S. and Canada to engage in some serious trade talks. Canada could buy back the Phoenix Coyotes and the U.S. can throw in Celine Dion to sweeten the deal. The U.S. gets to keep "Saturday Night Live" alum Mike Myers, but Dan Aykroyd gets repatriated.

Whatever trade imbalances result can be solved with a few Prince Edward Island mussels and an agreement between both nations to never let Alan Thicke host a talk show again. Unless, of course, the dollar gets stronger; then everything's ours. Except for the Celine Dion part. Consider her a gesture of goodwill.

Mike Pesca, NPR News, New York.

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