Thinking of Investing in Canada Post’s Permanent Stamps? Think Again!

Canada Post recently launched it’s permanent stamp. Purchase the stamp now and never have to worry about increases to stamp rates that force you to buy those pesky 1 cent stamps.

Thinking of hedging against future stamp price increase by stocking up? Think again. Canada Post can only legally raise stamp prices by 66.67% of the inflation rate. According to my calculation, the average inflation rate in the last 30 years is about 4.8%. Two-thirds of that is 3.2%. A pretty shitty annual return if you ask me. This is especially true if you consider the last 10 years where inflation averaged under 2%.

Don’t be tricked by Canada Post’s marketing. You’re better off throwing your millions in the TSX Composite, which averaged about 8% over the same period.


3 thoughts on “Thinking of Investing in Canada Post’s Permanent Stamps? Think Again!

  1. How does this compare with the United States’ postal policies? Do you think the US will launch a permanent stamp like Canada has done?

  2. Although as an economist I’m generally obligated to make shit up (and believe it) when I don’t know something, I have no answer to your question.

    I found that telephone inquiry staff at Canada Post were quite helpful in answering questions, and I’m sure US Postal Service staff are equally wonderful.

  3. Canada Post can only raise the price of stamps by 2/3 of inflation rate change, until they change the rules. As of Spring 2014, it will go up to $1. That’s a 50% increase compared to now. No wonder they suddenly stopped selling the permanent stamps this morning !

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