Adventures in Foreign Exchange, Booze Edition

By Reuters Staff
March 11, 2009

I’m back from England, which is clearly a country where the populace is highly aware of international exchange rates. The pound has imploded of late, which is why you see ads like this at Heathrow’s Duty Free shop ("At current exchange rates, it pays to buy before you fly"):

champagne.jpg

But some currencies have done even worse, which is why you see ads like this on the London Underground ("Take advantage of the best exchange rate in years!"):

icelandair.jpg

Incidentally, my local NYC wine merchant sells Piper Heidsieck for $33 a bottle; if you spent £35 on two bottles at Heathrow, that works out to about $24 apiece. And when it comes to my favorite Duty Free purchase, Scotch, I can tell you that after years of finding the Heathrow prices significantly higher than NYC prices, they’re now signficantly lower again. Bowmore cask strength was being sold at £31 per liter or £57 for two liters: that’s equivalent to less than $30 for a 750cl bottle here in the US. Cheers!

Reprinted from Portfolio.com

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Comments
One comment so far

Although we are accustomed to the multicurrency international monetary system, and to the unpredictable fluctuations of exchange rates, we need to pause and take a look at the absurdity of the system. There is no logical reason why the wealth of countries and monetary unions, as measured by their currencies, should fluctuate from day to day. What is needed is a Single Global Currency, managed by a Global Central Bank within a Global Monetary Union.
The success of the euro shows that monetary union is the best way to ensure monetary stability. The primary problem with the euro and currencies of other monetary unions is that they still must co-exist within the international multi-currency system itself where the value of those common currencies must still fluctuate in value against each other.
With a Single Global Currency, there are no such fluctuations, by definition. What the people of the world want is stable money.
If 16 countries can use the same currency, why not 192?
In addition to eliminating currency fluctuations, the use of a Single Global Currency would eliminate the current foreign exchange trading expense of $400 billion annually, eliminate currency risk, eliminate
current account imbalances, eliminate the need for foreign exchange reserves (now totaling more than $4 trillion); and bring other benefits worth trillions,
such as reducing the impact of global financial turmoil such as we are now experiencing.
The Single Global Currency Assn. (www.singleglobalcurrency.org) promotes the implementation of a Single Global Currency by 2024, the
80th anniversary of the 1944 conference. That’s only 15 years away.
The world is moving toward a Single Global Currency through the creation, expansion and merger of regional monetary unions. Another route is through international monetary conferences proposals and agreements,
such as were seen at Bretton Woods.
The challenge now is to reach that goal deliberately, as soon as possible, with as little cost and as few crises as possible. Yes, as you note, it will be a “massive, complicated undertaking”, but so was the creation of
the euro, and the world now knows that it can be done.
See the book, “The Single Global Currency – Common Cents for the World.”
Morrison Bonpasse
Single Global Currency Assn.
Newcastle, Maine, United States

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