Saturday, June 4, 2011

Euro-ver My Budget!

Bonjour, mon amis!

I am in the middle of a delightful adventure in Paris,* and even though it's involved a lot less business casual than usual, the economic applications are robust! (And you know, all the art, culture, and food are pretty good too.) Also noteworthy is the B.O. on the Metro. There is absolutely nothing like coming off a long day of beautiful sightseeing, mind dazzled by crown molding, stomach full with delicious French dessert, and nose full of sweaty Parisians. In NYC, people carry pepper spray for protection. In Paris, I think they could carry Axe. (Imagine the headlines: Americans prove cleanliness is next to godliness with personal hygiene! Tourist creates large personal bubble with deodorant zone! Two hospitalized due to lack of personal odor!)

A few days** ago, I went to the ATM. This is big for me, because I think it's the third time in my life I've ever been to an ATM. (This is because I never carry cash. Ever. Unless I have to.) Anyway, I went to the ATM, and got some euros out, so that in case I needed to pay cash, I could. Let me just say, exchange rates will bite you. Hard.

The not-so-magical thing about inflation is it means your money is worth basically nothing. In a quick, oversimplified summary of US economic policy, if you have a lot of debt, you print a lot of money so that you can pay the Chinese back. It seems like a great plan, because the dollars you give them are worth less than the dollars they loaned you. "Au-hau-hau-hau, we have tricked you," you say in a French accent. Sadly, inflation is a lot like wearing sandals with socks. Even though it seems like no one will notice, your feet will be cozy, and you can avoid tying your shoes, it's bad. Really bad. Even though it seems like no one will notice inflation and you'll get away with deficit spending, it's actually really bad. It kills your exchange rate.

So, when I try to figure out how much a croque-monsieur (or, as a fellow tourist calls it, "A frikkin' ham and cheese") costs, I have to multiply the price in euros by 1.5. This is unfortunate for several reasons:

  1. It involves mental math on an empty stomach
  2. It makes euros feel like the entire metric system: a way less precise way to measure things and have it all round to 10
  3. It's demeaning to the American spirit. It feels like you're paying for the privilege of using a different currency (don't tell anyone I said that - I think they'd love that idea.)

So, when I got out 30 wee little euros, it cost my bank account a whopping $45, plus a 3% international service fee. AWESOME. As much as this is a death blow to my tiny little bank account, it's a good reminder of some fun economic principles, like "Money Can Be Bought" (this is what bonds are), "Incentivize What You Want (chic Europeans with their euros), Tax What You Don't Want (American tourists)," and "Printing Money to Pay Your Debt Will Turn You Into Zimbabwe or the Weimar Republic, and We All Know How That Turned Out" (less catchy, but true).
Oh, and everyone's favorite: [Even in Paris] There is No Free Lunch.

I bought some expensive euros in:
Brown patterned maxi dress, silver tribal disk earrings, and brown flip-flops.

*No. Don't get any ideas about robbing me because I'm abroad. I live with people who are home right now. Also, you should know better than to believe everything you read on the internet. 

** This is probably about now. The time change puts me about 6-8 hours ahead of my friends in the US. Let's just say I'm scouting out the future for you all.