Why you’re paying more at the gas pump – May 08, 2018
If you’re interested in reading this article in full you’ll want to click the link below:
https://www.thestar.com/business/economy/2018/05/07/why-youre-paying-more-at-the-gas-pump.html
Umm yea, so I don’t think Canadians are getting the disaster that’s headed our way if the Canadian dollar is no longer viewed as a petrodollar. what stood out to me about the article above was the mentioning of “the decline in Venezuelan oil production”, if the Canadian dollar is no longer linked to oil what is it linked to? Without Albertan oil why should the Canadian dollar have value??? Hmmm, let me think, well Canada is known for it’s banking system right? So if the Canadian dollar has severed its ties from oil, if Canada has sold off it’s Gold reserves, what the Canadian dollar is now reliant on are their banks? Well all I can say is let’s make sure that housing and credit market stays afloat, being that commodities are no longer keeping the Canadian dollar a float apparently fiat money is?
I’ve stated many times over that, I’m against Albertans economic structure of how they sell their oil, with that said I’m not going to act like if the Canadian dollar is separated from oil especially with all the entitlements canadians already take for granted that inflation is going to be a HUGE problem in the coming years. I’ve also state that based on my research the Progressive Conservatives sound a lot like Liberals to me the truth of the matter is a large chunk of the Canadian public is asleep to the disasters coming their way if this craziness continues.
If the Canadian dollar is no longer a petrodollar we’re in for a hyper inflation, not to the extent of Venezuela but something similar. People forget it was the combination of lower oil prices with the fact that Venezuela wasn’t maintaining and upgrading their oil related equipment that led to rapid hyperinflation. In Canada the fundamentals are different primarily because of Paul Martin, however these new age Liberals along with Stephen Harper’s conservatives did little to address the energy, oil sector in Canada. Canadians were already entitled under conservatives and those entitlements and regulations expanded under Justin Trudeau’s regime, Alberta is now fighting with British Colombia about pipelines, even though I personally think Alberta is approaching their precious resource all wrong, it doesn’t mean that based on their ideology of how their oil should be sold that they don’t have some valid points under federal law.
That aside if the Canadian dollar is no longer a petrodollar what is it? Because if it ties to nothing, the Canadian dollar could expect fluctuations similar to the cryptocurrency market, as forex traders begin to price it based on their belief of what the Canadian dollar signals to them. As much as people bad mouth the US dollar it’s important to understand the symbolism of Fort Knox. Is there any Gold in Fort Knox? Who knows but the mere fact that it’s there and people believe there are gold bricks present there tells you a story that yo can figure out in your own head. In Canada, there exists no Gold reserves, the Canadian military, Canadian military defense as brave as these soldiers are… well, let me move on, if the Canadian dollar is no longer a petrocurrency, the Canadian banks may just mean more to Canada than they’re being given credit for.
In closing Canadians are paying more at the pumps because our dollar is worth less. If you remember under Harper when oil prices went up so did the Canadian dollar, but because Canada has to buy Gas from America gas prices went up a little bit too, however it was offset by the fact that the Canadian dollar was stronger. Now what was problematic under harper with the higher loonie was the fact that most Canadian companies built their businesses selling to America, because the the Canadian dollar was lower than the U.S dollar. What his did was it gave the excuse for Poloz to lower interest rates, which gave rise to the housing boom and also proved disastrous when Oil prices crashed soon after.
Justin’s Liberal party of Canada is obsessed with virtue signaling and from my perspective resemble the NDP with their approach to the economy. I’ve said this plenty of times and I’ll say it again, in the 1990’s Justin Trudeau’s policies may have worked, because interest rates were higher and Canadians weren’t in the types of debts they’re in now, but in this age, an economic crash may actually worsen the problem, if the canadian economy doesn’t collapse now, the economic collapse in the future will be way worse.
A collapse now will allow people to look at the policies that are hurting the economy, if they extend this collapse and let’s a crash happens and the government tries to fix it with more regulations, Canada is going to experience a barrage of crashes. I’ve said this before the Ontario and British Colombian housing markets can’t have a prolonged period of price depreciation, especially in the condo market, most of the owners are speculators, who expect to either flip their condo for a profit or rent out their units for a profit, if they can’t do either, interest rates rise, less people qualify and prices to purchase real estate continue to fall while maintenance fees and taxes rise, and government adds more regulation, it’s a disaster.
It will be a disaster only Hyperinflation can solve it and with hyperinflation the people working in both the private and public sector will demand a pay increase which puts those on a fixed income (the largest voting sector) in a position to vote for austerity. If austerity measures are created it will spook the private sector and this is what leads to very harsh economic collapse, that will be extremely difficult to fix. This is why the BoC in the future will be faced with deflation of hyperinflation, it’s going to have to pick it’s poison and it’s this fact that Liberals and the Progressive conservatives are going to have to face.
I listen to Andrew Scheer and Doug Ford and based on what I know neither one seems to understand how bad the problems really are.
Interesting times ahead…