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Another interesting thing is that many countries are experiencing lower inflation than the US, but their currency is getting weaker, so the USD's purchasing pow
by imustbeevil 4y ago
Another interesting thing is that many countries are experiencing lower inflation than the US, but their currency is getting weaker, so the USD's purchasing power is increasing two-fold. I've been planning a trip to Malaysia because while their exchange rate against the dollar has fallen, they've only experienced ~3% inflation, so not only are all of their products 22% as expensive, they also haven't meaningfully changed in price since 3 years ago (from the dollar perspective), whereas the dollar's purchasing power in the US is basically down 25%.
- JumpCrisscross 4y ago> been planning a trip to Malaysia because while their exchange rate against the dollar has fallen, they've only experienced ~3% inflation, so not only are all of their products 22% as expensive, they also haven't meaningfully changed in price since 3 years ago You’re running a real-goods arbitrage analysis. It’s dicey to compare national inflation statistics for this purpose. They’re measuring separate baskets of goods on different methodologies. This means you must reconstruct the baskets. As such, you might as well measure the things you’re buying. For traded goods, e.g. grain and fuel, there is unlikely a massive pre-tax spread because professionals are looking at the same data. For non-tradable goods, e.g. hotels and restaurant meals, you might see a yawning gap.