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These are stories Report on Business is following Monday, Sept. 24, 2012.

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How do you say 'no' in Icelandic?
Iceland's central bank has now spoken on the issue of whether the country should ditch the króna  and adopt the Canadian dollar.

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And it doesn't really like the idea.

There has been a push in some quarters of the country to adopt the loonie as its currency, though Iceland is heading toward membership in the 17-member euro group.

Just to remind those who may have forgotten, this story began to take shape last March when Canada's ambassador to Iceland, Alan Bones, told a local broadcaster that his government was ready to talk about adoption if Iceland opted for it.

Since then there has been much discussion.

Last week, Iceland's central bank published a massive report on the country's currency options. It's in Icelandic, though the executive summary has just been translated and posted to its website.

The report runs through various options, including joining the euro monetary union,  adopting a Nordic currency or choosing the British pound or U.S. dollar.

Then there's the loonie, as the Canadian currency is known.

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"The Canadian dollar, on the other hand, appears in most respects to be a poor choice compared to the other currencies previous mentioned: Canada is a small currency area with non-existing network effects, trade with Canada is very limited, and the two countries' business cycles have little in common. Monetary policy in Canada is sound, however."

So, forget about Iceland. Futures traders are still mighty keen on the Canadian dollar, though, to the point where it's a bit too popular.

"Bullish sentiment towards CAD is notably high," said senior currency strategist Camilla Sutton, referring to the currency by its symbol and citing numbers released Friday by the U.S. Commodity Futures Trading Commission.

"Friday's CFTC data highlight that net long CAD positions are at record levels ($12-billion) and are still being added to; while risk reversals suggest that the options market is also positioning for further CAD strength," she said in a research note today.

What that means is that futures traders are betting more than ever before that the Canadian dollar will appreciate further.

The loonie has been holding a few pennies above parity with the U.S. dollar for some time now, though it's down today as the greenback strengthens on general concerns related to the euro zone.

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Ms. Sutton noted that the Bank of Canada is now the "lone hawk" among the major central banks, citing some form of stimulus from the Federal Reserve, the European Central Bank, the Bank of Japan and the Bank of England.

"This divergence in monetary policy is having a major impact on CAD, one we expect to continue to support the currency into year-end," said Ms. Sutton.

Sébastien Galy of  Société Générale said positioning in the Canadian currency is now "extreme."

"Relative to three-year maximum position sizes, the CAD position is now the biggest it has been (a currency I like but which I will leave alone until it's less popular)," added his colleague Kit Juckes, SocGen's chief of foreign exchange.

IMF grows gloomier
The International Monetary Fund is cutting its economic outlook, and policy makers should resist equating buoyant stock markets with a healthy global economy, the fund's managing director said today.

Christine Lagarde declined to provide the new forecast, which will be released early next month at the fund's annual meeting in Tokyo, The Globe and Mail's Kevin Carmichael reports from Washington.

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In July, the IMF predicted the global economy would expand 3.5 per cent this year, a downgrade from an April estimate of 3.6 per cent.

Facebook sinks after Barron's report
Shares of Facebook Inc. fell sharply today after the influential publication Barron's said the stock is overvalued amid mounting uncertainty for the operation.

Facebook shares have tumbled from their May IPO price of $38 (U.S.), and, at their current value, are still trading "at high multiples of both sales and earnings," Barron's said Saturday.

It suggested that the stock, now trading at 47 times Facebook's projected profit of 48 cents a share this year, or well above the levels of Google Inc. and Apple Inc., is worth "perhaps" just $15.

"That would be roughly 24 times projected 2013 profit and six times estimated 2013 revenue of $6-billion, still no bargain price," Barron's said.

"Wall Street's consensus estimate for 2013 shows earnings rising 31 per cent, to 63 cents a share," wrote Andrew Barry.

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"That pro forma number is generous because it ignores Facebook's very significant stock-based compensation. The company has been issuing gobs of restricted stock to engineers and other key employees in the hot Silicon Valley job market to prevent them from being lured away to the next hot tech startup -- the next Facebook."

Facebook, Barron's said, must determine how to capitalize on its fast-growing mobile shift.

Canaccord cuts deep
Canaccord Financial Inc. is cutting deeply into its advisor force amid a market slowdown, Streetwise columnist Boyd Erman reports.

Canaccord, one of Canada's biggest independent securities dealers, is closing 16 branches and keeping 16.

It's also cutting loose 35 advisory teams in the offices that remain. Toronto-based Canaccord lost about $6.5-million in the most recent quarter handling accounts for individuals, but will now "operate in a near break-even basis in current market conditions," the firm said.

India eyes oil sands
ConocoPhillips Co. is in the final stages of negotiating the multibillion-dollar sale of as much as 50 per cent of of its Canadian oil sands holdings in an auction that has attracted a number of private and state-owned foreign suitors, The Globe and Mail's Jacquie McNish and Carrie Tait report.

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According to people familiar with the sale process, Houston-based ConocoPhillips began accepting bids in July and has entered what one person described as a "very vigorous bidding process" with an unidentified group of top bidders.

According to a number of media reports, one of the suitors is a consortium of three state-owned oil and gas companies from India: ONGC Videsh Ltd., Indian Oil Corp. and Oil India Ltd. One report from Dow Jones pegged the value of Conoco's oil sands assets at $5-billion.

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