[Tcoat]

Originally Posted by keithr

I don't think I follow your logic...

For the sake of example, let's say it's a 2:1 conversion (CAD/US).

If we are to assume that wages and cost of goods both scale with the same conversion, and if we had equal wages:

If I made $10,000, you would make $20,000. If I pay $6 US for a gallon of gas, that's 0.06% of my wage. If you pay $6 CAD for a gallon of gas, that's 0.03% of your wage. You should pay $12 CAD for the same gallon of gas that I pay $6 US for, if they were to cost the same.

So, if we're both paying $6 of our respective currency per gallon of gas, I'm paying a lot more for my gas than you are. Double, to be exact.

Your argument of "a dollar is a dollar" is only true if you never look outside your own currency ecosystem for comparison.

Beyond that, my point was more that the cost of goods is not constant across borders. I have heard many times that, conversion aside, certain goods cost more or less in different countries.

Another example, again let's assume a 2:1 CAD/US conversion: I buy a new TV for $500 US. That same TV should cost $1000 CAD, for it to have the same cost ratio. However, if that TV actually sells for $1200 CAD, you're paying more for it than I am. I've had people cite examples exactly like this.

There are reasons, of course, beyond the currency exchange. Import taxes, tariffs, trade negotiations, etc.

I was with a group of colleagues from the UK last year in San Jose for a conference. They insisted on making a run to Best Buy to buy electronics. Even at inflated RETAIL prices, they said it would save them significant money to buy here and transport home (including paying the duty taxes) than buying at UK prices, and these are very smart nerd types, so they did the math on the exchange vs. cost/value ratio.

In either case, I can afford a beer in either currency, so I owe you one.

Oh there are certainly things that we pay more for I was not for one second saying we are even on prices. You 2:1 exchange example is exactly what I was saying though. If we took you prices as reality and all things were equal then yes we would pay $12.
Obviously I simplified the whole thing to try to keep it clear and there are 100s of other things we could factor in if we wanted to go into the whole economics of the subject.
My point remains that in Canada what costs a dollar costs a dollar and there is no reason to factor in exchange. Right at this moment with the low Canadian dollar if we compared exchange adjusted prices vs wages it would look like we are all rich. Prices here did not go down just because the Canadian dollar is below the US.