But, it's only a good investment if the US dollar rises against the loonie again. That's what the people advocating buying US stocks are betting will happen. But it's just that, a bet. If the US dollar keeps falling instead, then your cheap assets will only get cheaper.
One investor says “As we've seen, when the dollar has got to parity or traded above parity it hasn't stayed there long.”. So they expect the US dollar to rise, and the value of US stocks to rise with it. Which would be good for you if you bought stocks before the rise.
This could well happen. But it could well not happen. If China decides to alter its strategy keeping low the value of its currency to help its exports then it will stop buying US treasury bonds.* This will lower demand for US dollars, and lower the value of the dollar.
This could well be a good thing as far as America is concerned, as it would help reduce their unsustainable trade imbalance. But it would most certainly not be a good thing for any Canadians who were convinced they should buy US denominated assets based on a newspaper article.
Feel free to invest in US stocks, but be aware that if you're unsure which way the dollar will go, then you're essentially gambling.
* For those following this, you may have noticed that this is exactly what the US government has been asking China to do for the last several years (stop keeping the renminbi undervalued). Yet at the same time there is widespread worry that China might "stop buying US treasury bonds", which, of course, is exactly what they've been asking them to do. So the policy has been a little muddle-headed here.
If China did stop buying them, then the budget deficit could still be financed, the central bank could buy the bonds instead. This would lower the exchange rate.
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