ramblings & exploration

The Force is Strong With This One (Dollar): Top 3 Destinations to Spend Your Buck

Imagine the US dollar has been lifting weights over the past 10 years, wearing an oversize hoodie and sweatpants. Today, the dollar rips off its shirt, heads to the beach and reveals its 6-pack abs and all around muscular physique!

Yeah, that’s the dollar I want to travel with, too.

Historic gains have been ripping through the S&P 500–the index is up almost 90% over the last decade. Like the US equity market, the dollar is also Superman-strong. As a U.S. citizen, or anyone holding USD, your buck has the potential to take you further than any other time in the recent past. I’ll show you just how much you can stretch that equivalent, value-menu Jr. Bacon Cheeseburger!

First, I evaluated the top traded currencies of 2016 to get an idea of how four quarters stacks up against the equivalent currency. Second, I noted other currencies which appear to be on sale and offer tremendous value.

Taking a longer term view, I figured how much the dollar has gained (or lost) from 2007 to 2017. For example, the exchange for the dollar to the Great British Pound was 1USD=0.49GBP, on average, over 2007. Today, that average exchange rate for 2017 is 1USD=0.81GBP.

I took this approach because I am much more interested in the value the current dollar represents today, over a period of a decade, than a year-over-year change. In a word, perspective.

I’ve come come up with a top-3 list of cities to visit, based on where the USD represents an extremely great value, considering the 10 year time horizon.

Buenos Aires, Argentina
Ten Year Value: 1USD=15.73ARS vs 1USD=3.11ARS

All things being equal, your dollar will give you nearly 5X the value it did back in 2007. That’s insane! Sure, inflation has rocked Argentina over the past few years, but the value the dollar provides here cannot be ignored.

Vegetarians look away! Argentina knows a thing about a great steak, as its annual beef consumption ranks second to only neighboring Uruguay on a per capita basis. Make nice with a local and get yourself invited to an asado. Check out this mouthwatering page for all the details.

Expect great weather throughout March with temperatures ranging from 65-80°F (18-27°C), with an average around 71°F (22°C). Perfect for your street tango encounters.

An AirBnB along the famous Avenida 9 de Julio in March averages $45-$75/night for 2 guests. These rates are for an entire private home/apartment.

Cape Town, South Africa
Ten Year Value: 1USD=13.38ZAR vs  1USD=7.06ZAR
The dollar has consistently grown stronger over the last 10 years with regards to the South African Rand. Today, your greenback affords almost double what it did back in 2007.

Take the cable cars all the way to the top of Table Mountain. With views of the bustling harbor and Cape Town Stadium to the north, this mountainous lookout provides incredible views of the South Atlantic Ocean and the port city below.

Swartland, a region about an hour north of Cape Town, has shot into the spotlight in recent years. Plan a trip here and see where some of the country’s best wines come from. And remember, since your buck goes twice as far, toast a second glass (or bottle; no one is judging).

Moscow, Russia
Ten Year Value: 1USD=59.1RUB vs  1USD=27.2RUB
Experience the crushing power of the Kremlin. You’ve no doubt seen colorful pictures of Saint Basil’s Cathedral, but the view from the cathedral into Red Square is one of the most impressive anywhere in the world. The surrounding fortress walls command dominance and offer a glimpse into the importance of the complex throughout its storied past.

Despite Moscow being quite an expensive city, if there ever was a time to visit, it’s now. Do yourself a favor though and visit during June, July or August, as these are the only months the average temperature is agreeable and hovers between 60-65°F (15-18°C).

Sure, the dollar is quite strong in a host of countries, but these three offer exceptional value and should be included in anyone’s travel itinerary if overall value is the objective.

You will notice that Mexico, Brazil, and other countries represent a great opportunity as well. However, these countries have consistently been less expensive over the long-term. I’m advocating taking advantage of large fluctuations in otherwise expensive destinations while you can.

Data compiled from: http://fxtop.com/en/historical-exchange-rates.php?MA=1