Products in demand

No matter what the subject, you can always get a second opinion — if not a third and fourth.

Take the question of the Canadian dollar. Few in the mining industry would argue against the need to keep the value of the dollar from rising too high. A strong dollar makes industries that export their products less competitive. But Paul Beeston does not share this opinion. Beeston is president of the Toronto Blue Jays baseball club, one of the most successful franchises in professional sport. What the rest of us consider a game, he refers to as an “industry.”

Speaking to a group of mining executives at a meeting sponsored by the Coopers & Lybrand consulting group, he said he was probably the only one in the room hoping to see the dollar go up, not down. His payroll is almost entirely paid in U.S. currency, so when the value of the Canadian dollar goes up, ticket sales to watch the Blue Jays covers a larger proportion of that payroll.

But even though the baseball team has benefited from the strong Canadian dollar while mining companies have suffered, mining companies might take some solace in comparing their payroll headaches to his. The Blue Jays expect to double their payroll in 1992, to US$40 million from about $20 million in 1991. There is one advantage baseball teams have over mining companies, however. We all have to deal with fluctuations in currency values, but baseball teams don’t have to worry about cyclical demand for the commodity they produce.