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Great Ceasar's ghost!
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Discussion Starter · #1 ·
I really felt the need to post this...... it is beyond pure garbage... one reason why I fucking HATE being Canadian at times... (I love being Canadian though!!!)



Canadian consumers haven't reaped any of the benefits of the rapid increase in the Canadian dollar rate, leading to higher inflation and growing pressure to raise interest rates in this country, a bank economist says.

The costs of a high Canadian dollar — more expensive exports and fewer manufacturing jobs — are well-known.

But what about the benefits?

"Retail prices in Canada have responded to the loonie's moon shot with all the speed and alacrity of a three-toed sloth on a hot summer's day," Porter said.

The most obvious example is the wide discrepancy in the prices of books and magazines. Paperbacks that sell for $9.95 in the U.S. are routinely priced at $12.95 in Canada — a 30-per-cent premium that is far greater than the current seven per cent difference in the currency.

"The spread on book prices only stands out because of the ease of comparison," Porter says. "Many, many other products are at least as far out of whack."

Porter compared a number of products selling on both sides of the border. In a few cases, Canadians were not being overcharged. For example, Apple iTunes charges 99 cents for a song download in each country, so Canadian buyers actually get a break.

But in most cases, the Canadian buyer paid heavily for buying the product in Canada.

He cites the cost of a Honda Accord. It lists for $26,500 in Canada, but only $20,475 in the U.S. After taking the exchange rate into account, the U.S. Accord is 14 per cent cheaper.

A BlackBerry 8100 wireless device lists for $499 in Canada. Assuming an 88-cent US Canadian dollar, one would expect the BlackBerry to list for $439 in the United States. But it actually lists for $399.



The study's comparisons were based on an 88-cent US dollar, even though the current exchange rate is closer to 94 cents US. But Porter acknowledges that prices can't be adjusted instantly to reflect the latest exchange rate.

Given the higher Canadian dollar these days, he says the price gaps between the two countries are even wider, meaning that prices in Canada should be even lower.

The price gap has serious policy and economic implications for Canada, Porter argues.

He says that higher prices have helped to boost Canada's core inflation rate to 2.5 per cent — the highest among the G7 countries. That inflation has, in turn, increased the pressure to boost interest rates.

"If consumer prices had reacted even a little more forcefully to the loonie's steep ascent, core inflation would be considerably closer to the [Bank of Canada's] two per cent target, and officials would not be openly warning that rates need to go higher," Porter said.
Return to cross-border shopping?

He also warns Canadian retailers that if the price gap remains as wide as it is, Canadians may take up cross-border shopping again.

Bruce Cran, president of the Consumers Association of Canada, says Canadians are already doing that. He said he was at a shopping centre in Bellingham, Wash., last week, about a half-hour's drive from Vancouver, and said he "couldn't believe" the number of Canadian cars in the lot.

The CAC has been doing its own price comparisons for months and has found, like the BMO study, far bigger price gaps than the differences in the exchange rate would suggest.

"You're far better off to get U.S. money and walk across the border" to buy many products, Cran told CBC News Online.

Cran thinks it's the distributors and importers who are failing to pass along the currency savings, not the retailers.

"We've been unable to find anybody who imports goods into Canada who was prepared to say they had passed along savings attributed to the rise in the Canadian dollar," Cran said.
 

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Don't you love the "BS" these so called economists spew to give reason to such nonesense.
Why can't the every day consumer wait a few days for the exchange to adjust at any local bank??? YEA RIGHT.
 

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The most glaring example of gouging is in new book sales, with Canadian prices being as much as 30% higher than the American prices. Natch big Canadian retailers are going to drag their heels on putting pressure on American publishers to change the cover price differential, as they are buying the books in American dollars and selling them in Canadian. If there is going to be a boycott, it should be against certain massive Canadian booksellers.
 

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moonage daydream
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It is everything. I just bought a MyBook external 500Gb Hard Drive in the US for $130 at Best Buy. The price at Future Shop is $270 + 15% tax. That is more than twice the price!!! How can that be justified? I’m sorry, but I have been doing most of my food, alcohol and clothes shopping in the US for some time now. In fact I rarely shop in Canada. I know it is wrong, but when the government already take half of what I earn, I have to save money where ever I can. I know I am not the only one who does this.
 

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Great Ceasar's ghost!
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Discussion Starter · #9 ·
While I wish there is something I/we could do, only gotta suck it up :eek:hno:
 

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Indeed. I'm only 18 but I'm spouting "back when I was younger, "X Item" cost "Fraction of current Price"; in fact, you could buy "multiple items" for "current price of X Item" and get change!" on a daily basis.

My cousins (Aged 1 to 10) are frequently amazed at two dollar bills, glass pepsi bottles and candy that cost only one penny. The cheapest now cost five, a 500% increase. Craziness. DinoSours cost 10c each!! They were 3c each when I was a kid, but you could get four for a dime, 2.5c each. That's one fourth of the current price.

See? I'm doing it now!
 

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Paradise Island
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It is everything. I just bought a MyBook external 500Gb Hard Drive in the US for $130 at Best Buy. The price at Future Shop is $270 + 15% tax. That is more than twice the price!!! How can that be justified? I’m sorry, but I have been doing most of my food, alcohol and clothes shopping in the US for some time now. In fact I rarely shop in Canada. I know it is wrong, but when the government already take half of what I earn, I have to save money where ever I can. I know I am not the only one who does this.
My brother works at the Best Buy headquarters, they sell a lot of their computer hardware at cost (and make it back by selling 30 cent USB cables for $20). That could explain some of the difference.
 

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I've noticed people griping at POS about it when items have both CDN and US prices marked. It's usually small items like magazines and cards, but big US retailers like Pottery Barn & Williams Sonoma also do it on much higher priced items where the difference equates into more than a few cents.

Since stores in malls like the TEC will take US currency, I wonder if people will start paying in US$ and demand to pay the marked US dollar price? I'm sure the stores will argue the CDN price must be used in Canada though.

I'm guessing the industry will simply stop printing both prices to avoid the blowback...if it isn't staring us in the face, we will not know about it. Depends whether they think the added cost is worth it. Or...the CDN$ could simply drop again and solve the problem for them.

On a positive note, Itend to buy european magazines, and they seem to give Canadians a slight advantage over Americans....the French Architectural Digest I bought this weekend was priced at $9.95 USD and $9.75 CDN.




KGB
 

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"I'm guessing the industry will simply stop printing both prices to avoid the blowback"

They've already started that.
 

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I'm thinking about buying my new laptop south of the border, it would save me hundreds as the price is already a few hundred cheaper. Add in the lower taxes and its a win-win.
 

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I'm thinking about buying my new laptop south of the border, it would save me hundreds as the price is already a few hundred cheaper. Add in the lower taxes and its a win-win.
Yup. I hate to say it, but if Canadian retailers are going to sit comfy and rake in record profits, GO SOUTH! I wish Heather Reisman of Indigo could be given the hint that Canadians are not crazy about the spread between buying books in Canada and the USA.
 

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For Father's Day, I bought a card at the dollar store rather than the Hallmark ones since they are much more expensive than the American price.
 
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