Buck parity has no effect on prices

This weekend while you're out shopping, consider this: that new high-def television or dual-core laptop is ten to fifteen percent cheaper in the United States. After we tack on taxes, that figure approaches twenty percent. So what gives? The answer lies not with lawmakers who levy the high sale taxes, but rather retailers who have yet to adjust their prices to reflect the current valuation of the loonie. The Canadian dollar has risen steadily from an all-time low of $0.61 US in January 2002 to parity this past week. For the faint of math, that is a 64% appreciation in value over the greenback in half a decade. All the while, Canadians have seen virtually no savings for items such as music, movies, books, electronics, and more notably automobiles, over the same time period. Industry analysts will proclaim price fluctuation will create instability in the market. However, when talks of a hurricane approaching the Gulf of Mexico occur, you'll be sure to see those gas prices change like night and day.

Understandably, repricing merchandise every week will create havoc for Canadian retailers. However over the course of several months, one would expect to see a drop in prices, especially from online vendors such as Apple and Dell. Take Apple's online store for example. Their baseline Macbook model retails for $1099 US. Given that we're at parity this week, that equals the same in Canadian dollars. The only problem is, Apple doesn't permit shipping to Canadian addresses from their US store. So hop on over to apple.ca, and you'll find the same model retailing for $1249. After crunching some numbers, it appears that Apple's basis for their Canadian pricing is the 88 cent dollar, which hasn't been seen since April of this year. That's nearly 6 months. Considering how Apple was able to make a huge cut in their iPhone pricing, not to mention the $100 vouchers, I don't think a price re-adjustment on their Canadian store site would be too arduous of a task to accomplish. The same can be said about Dell. Their baseline model Inspiron 1501 retails for $499 US. Since we're at parity, that should be $499 CAD. Once again, you cannot order from the US store to a Canadian address. At the dell.ca, the same model retails for $549. A few calculations reveal that this is accurate as of May, when the dollar was hovering around 90 cents.

Apple's online store

Although the Canadian dollar is on par with the US dollar, Canadian consumers are still paying upwards of 10% in price markup compared to their US counterparts.

If retailers know what is good for business, they will adjust their prices, and do so fast. With the holiday shopping season six weeks away, sooner will be better than later, especially when it comes to big ticket items such as computers, game systems, and televisions. Even after taking into consideration shipping and taxes, mighty fine savings can be found south of the border.

So while the weather is still good, head down to the bank and get some greenbacks while they're cheap, because parity won't last forever. Then make the journey across the border for a weekend of savings. Be sure to purchase some clothes, shoes, jewelery, electronics, and a full tank of gas while your at it. Because apart from that, there won't be any savings on this side of the border any time soon.