A Money Coach in Canada

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Warren BuffetLike many Canadians, I muse about the future of the Cdn dollar relative to the USD. Four years ago, Warren Buffet gave his opinion – prescient, per usual. If you haven’t yet read him, this is a wonderful introduction. The reading really gets going when he starts describing Squanderville and Thriftville, as illustrative of economies.

Imagine Thriftville and Squanderville as two islands, he says. They have very simple economies – consuming only exactly what they produce. Each resident works 8 hours a day to produce, and consumes 8 hours/day worth of items.

Years go by, then: innovation! Thriftville residents begins working 16 hours per day, but still consume only8 hours/day worth of the items. What do they do with all the other 8 hours/day worth of goods? They ship it over to Squanderville, in exchange for paper IOUs from Squanderville. Squanderville is ecstatic – they get to stop working altogether, and yet continue to consume the same amount as always!

This carries on swimmingly until both Thriftville and Squanderville get a little uneasy. Thriftville starts to wonder, “will Squanderville pay us back for all our hard work?” and Squanderville, now a couple generations later, starts to think, “Thanks Mom and Dad. Thanks so much — you’re dead and gone, but I’m stuck holding your lousy IOUs! Glad you enjoyed a lifetime of meals on me!”

Tensions rise. Buffet offers a possible solution, but I think the Econ 101 paragraphs are his (more detailed than I gave) descriptions of the two islands.

key-to-success.jpgHere’s how much:

  • Research in Motion -James Balsillie & Micahel Lazaridis: $1.1 million plus $91 million in stock options
  • Power Corp – Andre & Paul Desmarais: $1.8 million plus $34.8 million in stock options
  • Shoppers Drug Mart – Glenn Murphy: $1.2 million plus $31.6 million in stock options
  • Manulife Financial Corp. – Dominic D’Alessandro: $1.229 million plus $10.5 million in stock options
  • Rogers – Ted Rogers: $1.48 million plus$10.7 million in stock options.

Some nice, juicy canadian factoids for your next trivia game!

Hallelujah. The gst is probably dropping down to 5%. That’s a 1% raise for each of us. (thanks for the heads-up, mj!)

Maybe I can afford the new google phonegoogle-phone expected to be announced in the next couple weeks, and released in 2008. (oooo — could I betray the iphone like that??)

I ‘switched’ a few months ago, and then so did my brother and last week so did my mom. While it has not been the problem-free experience I expected, there’s no question: I’ve drunk the Apple kool-aid.

So have a whole lot of other people. Sales this past quarter are up 29 – Hello, 29%! – over last year same time.

Share prices jumped by 7% overnight.

ipods, macbooks, iphones … keep ’em coming, Steve. You’re making me rich.

(ahem, if I may say so, I did see this coming.)

Canajun Finances pointed out a CBC article quoting RBC, BMO, and TD economists who believe the loonie will drop to the mid ยข90’s by the end of 2008.loonie Rats. We’ll just have figured out how to navigate the increasingly stringent border issues, and then shopping in the states will be pointless.

LululemonLululemon, the Vancouver-based yogawear darling, is doing even better than expected, and their share price increased by 10%. (I shoulda bought. I shoulda bought).

10 days ’til LeopardLeopard is released! $129/usd for the license.

The Bank of Canada kept its rate steady today.

And Money Relations gives us the scoop on Warren Buffet’s forecast about our loonie et alia.

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