Thursday, June 16, 2005

A little bit of currency speculation anyone?

Has anyone noticed that the Canadian dollar seems to plunge every time we have a non-confidence motion scheduled in the House of Commons, then rises the following day, once Parliament lives to see another day? Seeing the dollar up by 0.8 cents on Wednesday drove this home for me.

It makes you wonder how many MPs and pundits have investments in the currency markets, and all the activity on their blackberries is really them selling off their Canadian dollar holdings the day before a non-confidence motion, then buying the dollar up again after the motion passes.

If I had money to burn, that's what I'd be doing!

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At 3:24 pm, Anonymous Noel M said...

Well, you'd be losing money if you did that.

The principle is to BUY LOW SELL HIGH.


At 3:32 pm, Blogger Matt said...

Depends how quickly you get your investor to move. What I meant was that your hypothetical investor would sell of Canadian dollars about a day before the vote, watch the value of the Canadian dollar plunge all day up until the vote, and then buy Canadian dollars up again immediately following the vote, before the cost rose again (and then sell off a bit later, once it peaked).

Just a thought and some idle speculation, as a humble junior prof like myself has no such money to spend!


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