Wow, maybe it will go back down to 49.9 where it used to be. :)

One hint of a war in the middle east and lookout, prices will jump 10 cents overnight

I’d rather pay $1.20 a liter if it means our dollar is at a respectable level, and people have jobs.

The lowere Canadian dollar means more jobs for Canada. Why? If a product sells for 1 dollar Canadian, it will cost them less and therefore they can buy more. Lumber is a prime example. The lower the dollar, the more they sell. On the other hand it costs us more for anything we import. That also means the better chance Canadians can compete with foreign imports. It really hurts people that want to vacation outside Canada. It costs them more. Stay home and spend your money here!

A barrel of crude oil is about 42 US gallons. Oil refineries heat it to 370 degrees celcius, as the vapor rises it is transformed into various oil products. The lighter molecules of gasoline, diesel or jet fuel continue to rise until it is cooled and syphoned into separate holding tanks. A barrel of crude oil can make about 19 US gallons of gasoline, 10 gallons of diesel, 4 gallons of jet fuel and another 9 gallons of other oil products such as liquid petroleum gas, plastics, lubricants or heating oil. A flight from San Francisco to Tokyo may take about 9,000 US gallons of jet fuel which requires about 2,250 barrels of crude oil to extract.
19 US Gallons is 78 litres @ $0.829 = $64.66
Add in the diesel & jet fuel and the oil companies are probably still doing OK.

Just wait until prices rise to where they were. People will be crying for 136.9 per liter gasoline. Because you all know the oil gougers will win in the end. They will get back what they think they have lost.

‘The lower Canadian dollar may mean “…more jobs for Canada”, but it’s also just the same as telling the crew they’re going to have to take a 30% pay cut if they still want to work. Without even giving them the opportunity to object. Something your Unions would never stand for if it was an employer who told his employees that. But when it’s done as it has been….? Ah, such confusion over those two little words, ‘jobs’ and ‘incomes’. Just about as bad as that between ‘money’ and ‘purchasing power’. You think they’re the same? Probably just as well, who would ever really WANT to ‘work’ themselves into bankruptcy, if the same result was obtainable doing nothing?

The oil companies won’t be doing okay either, because they now have to try to recover their ‘Capital costs’, money that’s already been spent in the PAST, out of falling revenues they’re receiving in the PRESENT. Short term, they may be able to reduce some of their ‘Labor costs’, by layoffs, but THOSE ‘costs’ are current incomes for a whole lot of people. And when they’re reduced, the spending from them also falls, and that can’t help but negatively impact the oil companies’ revenues. They may be able to remain profitable, but like many other businesses throughout the whole of the economy, can they remain profitable enough? Look at all the others who couldn’t, and where are they now?

Used to be the cost of a barrel of oil was the cost in cents per gallon..not liter.. $80 a barrel $.80 a gallon.. Oh how the times have changed. We then got screwed going to the metric system.. Used to be $80 a barrel was $.80 a liter.. Now sit $29 a barrel and $.83 a liter.. Oh the poor oil companies.. Hoarding billions of litres off shore in tankers just waiting for price to rise.. Then watch us pay… Making 12 billion a year isn’t enough…doenst make the “profitable enough”. They need 14 billion..

Canadian lumber firms and others produce in Canadian dollars and sell their product is US dollars, that’s why a low Canadian dollar works for these companies. Most products produced and exported from Canada are sold in US dollars.

PVal, a large part of the cost of every litre of gas is tax. I agree, we did get screwed when we moved to the metric system. And just who was responsible for that little piece of brilliant enlightenment? Why who else, the father of our current PM. Sold the idea to us that we ‘needed’ to change, so that we could continue to trade with the world. What were the first things to change? Road signs went from miles to kilometers, speed limits from MPH to KPH, temperatures from Faherenheit to Celsius, and yes, gallons and quarts to litres. And we paid more, and we got less. And what did any of that have to do with international trade?
But I digress. What’s done is done. Getting back to what is ‘enough’, what is enough is what it takes to keep the bankers happy. For they’re the ones who literally ‘make’ the money. The oil outfits, just like all the rest of us, merely get to ‘use’ it. For a price. Part of that price is the repayment of what has been lent. And that part comes from PROFIT. When a loan is received by a business it is not classed as revenue. And its repayment, of the principal sum, that is, is not classed as expense. It is, rather, a division of profit between the lender and the borrower. With the lender having first dibs on a fixed amount of it. When profits fall, lenders can’t lend, (or at least they won’t lend). When that happens…..?

Going metric was a smart move.. Rest of the world except the Mericans use it.. My company sells world wide, we sell in litres. Never any discrepancy ..no mistakes in conversion.

I do agree about the greedy banks.. Even though the bank of Canada is talking about negative rates the banks refuse to lower mortgages anymore..as a matter of fact they are increasing it all for,the sake of profit..slime balls.

That’s true to a degree, Palopu. But we run the risk, with lumber anyways, that if we get too much of the US market because of an exchange rate that’s ‘favorable’ to us, they’ll look all the harder to protect what’s left of their industry with tariffs. What also works against us is that a lot of new equipment made in the USA rises in price, and there’s no longer comparable or alternate new equipment made in Canada. Relatively new, but used equipment for sale here tends to get bought up by Americans, because they’re effectively getting a 30% discount on it, and shipped back to the States. The other thing is with the rise in prices of imported food and other goods, there’ll be pressure here to raise wages. And they won’t go back down if the dollar strengthens and gets closer to par with the US buck. And the big will get bigger, and those not so big, well, they’re history.

PVal:-“I do agree about the greedy banks.. Even though the bank of Canada is talking about negative rates the banks refuse to lower mortgages anymore..as a matter of fact they are increasing it all for,the sake of profit..slime balls”
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I hate to defend anything about banks, PVal, but despite the obscene dollar amount of the profits they often report those profits taken as a percentage of their overall ‘sales’ are actually falling over time. This is one of the reasons why they seemingly go out of their way to try to gouge us for every little thing they do for us. Most of which we were never directly charged for in the past, even though in those days their staffs were far larger. This is exactly the same thing that’s happening to all other businesses. And it’s something governments at some point are going to have to face up to.

PVal you mention oil profits but left out operating costs. When people jump onto the oil industry about profits, and ratio between operating, research, exploration costs is always conveniently left out.

What would be your standard of living with out oil?

About all that oil held in storage well that is a result of over production by the Saudis. The tap is not easy to shut off because of costs and operating issues.

now with Iran jumping in with more oil, watch the price go down even further.

The Saudis where wanted to destroy American oil production that ramped up with fracking and with their money reserves they figured on riding out the lower prices they caused. They may have shot themselves in the foot though. Their costs per barrel is actually over 100 $ US because of the costs of their economy. Now with Iran coming on line and war costs they are bleeding big time. Oil may shoot up sooner than later.

thisisme posted: “Add in the diesel & jet fuel and the oil companies are probably still doing OK.”

Your info as to the fractions distilled from a barrel of oil holds true on any day, no matter how much a barrel fetches on the open market.

The fact is, the feedstock for all those distillates of oil being pumped or removed from the bitumen has dropped in price while the other operation factors have not – interest rates, wages, equipment, maintenance, facility rental, admin overhead, etc. Most of those are fixed costs.

As far as lumber goes, remember the trade agreement. If the Canadian dollar drops in relation to the US dollar, thus making it cheaper to buy lumber in US dollars, there are penalties to be paid. The agreement is now expired. That is good for us if there is nothing that requires it to continue for the time until there is a new agreement in place. If not, wait till negotiation time to see how much “blood” the US lumber barons will extract from us.

I see socredible keeps on bringing out his cut and paste responses from the fantasy work of social credit economic theory which explain little and solve even less in the world of current practice.

work=world … :-(

socredible wrote: “What also works against us is that a lot of new equipment made in the USA rises in price, and there’s no longer comparable or alternate new equipment made in Canada.”

You seem to forget that the US is not the only place manufacturing heavy or special equipment that we do not manufacture in Canada. Most of the foreign currencies have fallen against the US dollar. Our sis not the only one. There are many other countries which make comparable and better equipment. We are not beholden to trade with the USA. That is where we have made a huge mistake and has been corrected somewhat in the case of dimension lumber, and may be corrected once more if this current situation holds for any length of time.

Remember, what is good for the little manufacturing that we have in Canada is also good for all those other manufacturing countries whose currencies have dropped and bad for US manufacturing.

We are heading for some new equilibrium. Such equilibrium shifts are always difficult to handle. It will be good for some and not so good for others.

OPEC runs the oil business.. They want to sink the Russians and China.. Doing a great job.. We are taking a beating as well.

gopg2015:-“I see socredible keeps on bringing out his cut and paste responses from the fantasy work (world, you meant to say) of social credit economic theory which explain little and solve even less in the world of current practice.
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What ‘cut and paste responses’ are you referring to, gopg2015? There is absolutely nothing above or elsewhere that I’ve “cut and pasted” from anywhere. As for what you call “the fantasy world of social credit economic theory”, I am quite sure you haven’t got the faintest idea of anything about social credit economic theory. Which you might think was anything but ‘fantasy’ if you did. And so in your current deluded state you seem to hold a whole bunch of notions about a lot of things economic which are truly ‘fantasy’. Too bad.

Socredible. As you probably already know, once the price of lumber drops below $300.00 per thousand fbm a 15% export tax kicks in. This tax was put it and collected by the Federal Government to get around the Americans putting a tariff on **cheap Canadian lumber**. This is the situation we are in now. Lumber selling at roughly $250.00 per thousand fbm. Its interesting to note that the Federal Government transfers the tax dollars collected to the Provincial Governments and it then disappears into general revenue. **Surprise**

Not sure what is going to happen with the softwood lumber file as it expires this year, and Trudeau and his cohorts are so busy taking selfies, they don’t seem to have time to get any work done.

The exports of lumber to China are down and will probably drop more, so the idea that we have an alternative to the US market is somewhat bogus. Especially when you consider that most of the lumber sold to China is low grade, and does not attract the top price.

Softwood Lumber Agreement expired on October 12th, 2015. That is over three months ago. Seems it has not hit the news very much around here or anywhere for that matter.

Any exports of softwood lumber products first manufactured in Canada and destined for the United States with shipment dates on or after October 13th, 2015 will no longer be subject to export measures. Consequently, following expiry of the SLA, Global Affairs Canada will no longer issue export allocations (quota) for softwood lumber products.

Socredible, if you are not cutting and pasting some of those standard responses, you could save a lot of time by doing so.

As to the “the fantasy world of social credit economic theory” …. it is a theory, to the best of my knowledge it has not been put into practice anywhere in the world. As long as it has not then it is just as much a fantasy as a theory because it is not factual as presented by actual practice.

You nicely avoid my response about the diversity of markets we actually have in this world and the fact that we shop for goods in countries other than the USA. After all, when one store starts to increase its prices while others keep their prices or may even reduce them, then one simply shops somewhere else, especially when the product quality is as good as or better than the store called “USA”.

Back to Komatsu…. ;-)

Harper certainly dropped the ball on securing a new agreement over softwood lumber. He knew he wasn’t going to win the election so he thought he would add one more thing to his list of screwing us over.

Everyone knows you start renegotiating months if not years before a deadline like this.

PVal, Harper did not “drop the ball on securing a new agreement over softwood lumber”. The American lumber lobby didn’t like the SLA as it was, and wanted changes based on their perception that our softwood lumber exports are subsidised. The Canadian industry and government reject this allegation. And so there’s an impasse. The US government has no need to negotiate any extension, and with a Presidential election coming this year no candidate is going to want to come out looking like they’re going to cave in to anything Canada wants that might cost American jobs. After the election, if we’ve grabbed too much of their market, they can simply impose tariffs, (and keep the money our government now collects). Now lets see Trudeau do anything about that ~ if it’s even on his agenda.

gopg2015:-” You nicely avoid my response about the diversity of markets we actually have in this world and the fact that we shop for goods in countries other than the USA. After all, when one store starts to increase its prices while others keep their prices or may even reduce them, then one simply shops somewhere else, especially when the product quality is as good as or better than the store called “USA”.

Back to Komatsu…. ;-)”
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Does Komatsu still use Cummins engines? Which are made where?

Yes, we can shop for goods in other markets than the USA. But when it comes to a lot of industrial and construction equipment most buyers here prefer to purchase what they’re most familiar with. One, because there’s usually a well developed dealer network here that can service the American brands they sell on a timely basis. And two, because parts are often more readily available or interchangeable than they would be for many other brands from other countries. The payments don’t stop when the machine goes down. Some of the quality of machines made in other countries is probably as good as anything made in the USA, particularly some of the European brands. And they may well be excellent machines. For Europe. Where the thinking about what a machine should be able to do is often different from what it is here in North America.

Palopu wrote:-“The exports of lumber to China are down and will probably drop more, so the idea that we have an alternative to the US market is somewhat bogus. Especially when you consider that most of the lumber sold to China is low grade, and does not attract the top price. ”
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I agree completely, Palopu. But gopg2015 seems to be of the opinion that we can sell lumber in trade with other
countries that make the kind of equipment we now import from the USA. The parts for much of which are often made in Canada.

He thinks that ‘multi-lateral’ trade will solve all our problems. That if we can’t sell lumber to Germany in trade for Sennebogen or Liebherr construction machinery, (because the Germans don’t need our lumber, when they can produce lumber right in Germany, or import it
from elsewhere in Europe; and the Swedes certainly don’t need our lumber either for a Volvo truck or log loader, nor do the the Finns, for any of the processors and forwarders they make there; nor do the New Zealanders, for any of their equipment; then we just sell our lumber to some other place,(where, I know not), and then take their money to pay for whatever we want to buy in the way of equipment from elsewhere. It all sounds so wonderful. Like the Liberal campaign promises. But….

gopg2015:-“As to the “the fantasy world of social credit economic theory” …. it is a theory, to the best of my knowledge it has not been put into practice anywhere in the world. As long as it has not then it is just as much a fantasy as a theory because it is not factual as presented by actual practice.”
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Well, I suppose there are many ‘theories’ that have not been definitively proved, even though there’s strong evidence they’re correct. More so, at this point in time, at least, than that they’re incorrect. And so it is with Social Credit. When we’ve tried everything else, and find it’s all still failing us, (even after multiple tries ~ as we’re again about to Federally), it’ll still be available. With nothing to lose, (by then). Or now.

Socredible …. your slip is showing.

You should have gone to the Cummins site to find the answer to your question before you ask it and you would not have been put into such an embarrassing situation.

The engines are made all over the world. Specific to Komatsu, the engines are made by the Komatsu Cummins Engine Company Ltd. In Oyama, Japan. The company is a joint venture of Cummins and Komatsu.

If you are interested in seeing where the other Cummins operations are, this is the source: cummins.com/investors-and-media/worldwide-manufacturing-locations

Socredible, we have a free trade agreement with the USA. We do not have an agreement to purchase as many goods from each other as we sell to each other. In fact, it would be difficult to achieve a balance of trade between any two countries if they were members of international trade organizations such as the WTO, NAFTA, etc. since there are typically limits to tariffs and other trade barriers. One cannot have it both ways in a free trade world. Each country is on its own to balance trade multilaterally.

So, going to the StatsCan balance of trade stats, they are given for the years 2009 to 2014. Trade with 28 countries is listed.

Source = statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/gblec02a-eng.htm

Specific to the USA, since they are our largest trading partners, each of the 6 years shows a deficit of imports from the USA which totals $251.294 billion by now. By your non-free trade scenario, the USA bought more from us than we bought from them so they owe that money to us. We are one of the many creditors of the USA.

How do you propose to get the money back from the US? Remember, we are not working under a simplistic and theoretical social credit system. Things have gotten a bit more complex than that over the years.

Merchants in a town, in a regional district, in a province, in a country have learned that a long time ago. It has expanded internationally.