When the dollar is worth a lot—the sound dollar—you would think everyone would be happy. Not so. A rise in the dollar makes U.S.-made goods more expensive abroad, and this makes it harder for U.S. products to compete with foreign goods. So growers, manufacturers—everyone who sells goods and services overseas—have to cut prices, thus lessening profits.

But the sound dollar has its plus side as well. It helps hold down inflation, because the dollar buys more for those with U.S. currency. For those traveling abroad, lodging and merchandise are less expensive.

Gloom in Florida

When the Canadian dollar went into steep decline, the tourist industry in Florida went into deep gloom. Many Canadians travel to Florida to escape the harsh Canadian winter. But when the Canadian dollar buys little, people stay home. Also, communities along the U.S.-Canadian border that do business with Canadians out on the town or on a shopping spree are badly hurt.

Helen Huntley of the St. Petersburg Times in Florida looked at what might happen to the billion-dollar tourist industry if the Canadian dollar kept sinking:

If the Canadian dollar continues its slide, thousands of Canadians could cancel their annual winter pilgrimages to Florida.

"There's definitely going to be an impact," predicted Jeff Fraser, vice president of sales and marketing for the Canadian Snowbird Association in North York, Ontario. He expects as many as 10 percent of those who ordinarily head south each winter will decide to stay home, at least partly because of their currency's decline.

The problem is that the Canadian dollar is currently trading at only 68 cents to the U.S. dollar, just above its all-time low of 67.85 cents recorded last week. Last year at this time, the Canadian dollar was worth about 72 cents and as recently as March it was 71 cents.

The slide continued. At one point, a Canadian dollar was worth only 64 cents U.S. If you have a calculator, divide one U.S. dollar by 64 cents. You get $1.5625. In other words, it would take about $1.56 Canadian to buy $1 U.S. Hold on. That's the bank rate, given only to big operators. The average tourist would have to dig up at least $1.60 Canadian to buy one U.S. dollar.

Smiles in Regina

On the other hand, an exporter of farm machinery in Regina, Saskatchewan, was delighted. Farmers with American dollars found his rock pickers a bargain as the U.S. dollar went a long way in terms of Canadian prices.

This led to another story:

REGINA, Saskatchewan—Some businesses here are happy about the steep decline of the Candian dollar. They report foreign buyers, not only those from the U.S., are buying at a record clip.