Thursday, November 29, 2007

So, about that US dollar...

5 comments
When we moved to Germany last year, one Euro was worth $1.21. Even then we found it a little harsh, starting out with no Euro(s? Does the plural have an s in English?) and having a $500 withdrawal limit from our US account, which wasn't so much anymore when withdrawn in Euro.

Now one Euro is worth $1.47 or $1.48 or so. We earn Euro. Pretty nice if we go visit the US, but not so nice for people coming to visit us. My mother-in-law complained that a cashmere sweater we saw on a sidewalk sale rack was expensive at 25 Euro. I thought it was a pretty good deal and was confused at her reaction until I realized she was making the calculation back to dollars in her head constantly. Prices in the EU don't go down just because the US dollar is sucking, see? (Even with the calculation I thought it was an alright deal, but she and I have been living in completely different cost-of-living areas for years.)

We still have money in an account in the US, which we use to pay some bills that are in dollars, like my student loans and our US credit cards, which we still use sometimes to buy gifts for people in the US online. And, of course we have an account here.

For a while it seemed like it might be a good idea to transfer some Euro into our US account while it's worth so much. Then when the dollar gets stronger again, we'll have more. We haven't done it yet because the dollar has just kept on getting worse and worse, to the point that we started to wonder if it was going to get stronger at all. I guess it will at some point, but when? I don't want to move money there only to have it become weaker.

5 comments:

  1. Hi CN,

    keep saving those Euros! I'm buying my cashmere here before heading over there.

    Is the DB strike over? We don't hear anything about it over in the US.

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  2. I just got back from the U.S. and took the opportunity to throw some Euro(s - I have no idea... plural Euro?) in my account there. It was quite lovely to realize that I made money just by taking it over the pond. Unfortunately I spent a good bit of it there too!

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  3. Considering that the exchange rate is at record levels, you can't lose by changing over now. If the dollar gets weaker, you're still earning euros. If it gets stronger, you've locked in the gains already made.

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  4. Bad Homburg: I think the strikers and the DB worked out a resolution! There hasn't been any more trouble since the big one when we went to Dresden!

    Snooker: It's so tempting to spend it, eh!? Because everything is so cheap....until...you buy too much of it...

    Ian: Good call! Now if only the US banking system was as easy as the German one I could do it right from my computer....:)

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  5. I take a somewhat sanguine view of this since I was living here and earning euros when the euro was somewhat around 0.80 to the dollar. The very long-term trend for the dollar is fraught with peril, given that the oil trading countries are questioning the wisdom of pricing their oil in dollars ... $1.60 per euro might be just around the corner.

    The good news is that beachfront property in the US is that much cheaper for us ... although Spain is nice, I'd rather be on a cleaner US beach in Florida.

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