Monday, March 17, 2008
The Not-So-Almighty Dollar
The last month we've been watching the U.S. dollar, not particularly strong six months ago, go into what seems like a free fall against the euro. When the euro became legal tender in 1992, it was trading at about 86 cents to the euro. Last spring, the euro was up to around $1.30 and by fall, it was hovering between $1.40 and $1.46. On Friday, it closed at $1.57. This morning in early trading, it's gone to $1.59. When the pundits said it would go to $1.60, no one believed it. And yet now we're pretty much there.
All things considered, it's probably not the best time to be an American in Paris. In the great heyday of American expats, Hemingway and his pals were buying francs at 35 to the dollar compared to about 6 or 7 francs to the dollar at the time of the switchover to the euro. But what are you going to do? Sigh. Just pour me another glass of good French wine.