Currency Observations

So i make a purchase the other day and i get back a Canadian nickel in my change. Okay, i'll admit we're not that far from Canada here in Anchorage, and i wouldn't put it past a random store to give me a Canadian nickel. But the US Postal Service? Reminds me of when i was in Zambia last year and the Livingstone International Airport had a "departure tax". The catch? It had to be paid in US dollars. That's right, apparently Zambia's currency isn't good enough for its own government to accept..

Which brings me to a discussion i had with The Lindsay last night. Apparently someone at her office is complaining about an impending trip to Europe and how she is concerned that the "Dollar is so weak against the Euro". So of course i start into an analysis of how historic trends should have no effect on purchasing power, and of the fact that the Dollar has been steadily gaining ground on the Euro for the last four months which will mean a short-term purchasing power advantage for Americans in Europe. i was about to get into arbitrage and how currency fluctuation trends will eventually trickle their way down into pricing parity for goods and services when The Lindsay stopped me. Apparently i didn't understand what she was saying; her co-worker was concerned that things would be more expensive in Europe. So i began to explain how given the markets and resources certain consumer goods will naturally be more expensive in Europe in real terms. The Lindsay stopped me again; her co-worker's mistake was even simpler than that. This person thought that when you exchange your 10 Dollars for 8 Euros, you have lost 20% of your purchasing power off the top. That's right, this person thought that a Diet Coke that costs 1 Dollar here would cost 1 Euro (and presumably 1 Pound in Britain and 1 Kwacha in Zambia)!

So this got me thinking. Everywhere i've gone in the world, i can expect a can of Diet Coke to cost about 60 US cents, regardless of the local currency. But other things, like food, actually seem to align with the absurd reasoning of The Lindsay's co-worker. i mean, i can get a decent plate of vegetarian curry for about 8 Dollars here. i have bought a similar dish elsewhere in the world for 8 Pounds, 8 Euros, 8 AUD, or 8 NZD, depending on where i've been. i even know where i can go in Durban to get this meal for 8 Rand or in north India to get it for 8 Rupees..

At any rate, after an extended conversation with The Lindsay last night about the Euro, i am reminded that i would like to take a class at some point on the economics of the Euro, and that at any rate i need to learn more about both the Euro and the EU..