I absolutely LOVE the colorful money around the world. The very first foreign currency other than the dull green dollar was the Euro. It was the very first time I exchanged my dollars for another currency. Like most people, I directly went to my local bank branch and kindly requested a certain amount of Euros.
The banker told me the current exchange rate of the dollar/euro before I accepted. The banker received my money, went towards the back, came back, and handed me all these colorful bills with different faces and monuments on them.
I use xe currency exchange to calculate the current currency price that I will be using.
ALWAYS check the current value of the currency you use. Prices fluctuate and are not constant. Global, political, and the market mostly determine the value of any currency.
1) United States Dollar (USD)
Most everywhere I have visited, more specifically in Asia and South America, most kids always ask me for a dollar. A dollar can go a LONG way for many people. This is called buying power. One can talk about buying power in many different scenarios, I will be specifically talking about buying power in terms of currency and accessibility.
For example, Today, August 10, 2021, 1 dollar is equivalent to 4000 pesos. in other words, someone who has 4000 pesos will have to give me 4 bills compared to my 1. now two dollars will be 8000 pesos and so on. The astonishing aspect about this is that a meal in Colombia will usually cost 7000 pesos.
The same can be said mostly everywhere around the world except for the euro or pound. That is because I must give more for either of these two currencies. For example, someone looking to trade their dollars for euros would receive less. The current exchange rate between the euro and dollar is .85 euro cents for 1 dollar or dollar for cents. On top of that, the British Pound is worth even more. 1 dollar is .72 pounds while 1 euro is .85 euros. CRAZY.
HOWEVER, I did also mention accessibility. By that, I mean how global the currency is.
Like I mentioned before, in some countries I often got asked for 1 dollar. Mostly by young smiling kids, shouting the few English words they know. This is because the dollar is circulated worldwide. From the stock market, reserves, and banks. The dollar is a great investment as the United States economy continues to grow. As a result, many want their hands on dollars as compared to their currency will be valued more. The same can be said about most global currencies. The dollar is unique in that it is recognizable and most currency exchanges accept dollars. Furthermore, the financial crisis
Most importantly, the dollar is a global currency due to the 1944 Bretton Woods agreement which named the dollar as the global currency, replacing gold. As a result, many countries around the world today adopt the dollar as their currency.
From El Colon to the Dollar, to Bitcoin, what are your thoughts on El Salvador's currency transition throughout the years?
2) Euro (EUR)
Home to 19 countries in the European Union (EU). Making it the most used currency in Europe. Which is a great thing! SImple because countries are right next to each other yet worlds away in terms of language, culture, and geography. In common is the euro.
Which is great when purchasing in cash. There are of course other countries within the EU, 8 to be exact that do not use the Euro. These being Bulgaria, Croatia, Czech Republic, Denmark, Hungary, Poland, Romania, and Sweden.
Out of the 8 countries mentioned above, I have held and exchanged the Czech Koruna, Hungarian Forint, Polish Zloty, and Romanian Leu. Each individual has a different value compared to the Euro. Regardless, the euro is valued more than the dollar! This means traveling to any other country, including the United States will actually get you more!
(10,000 Hungarian Forint)
The euro was the first currency I exchanged and I loved everything about it. Introduced in 2002, the Euro is one of the world's most sought out currency. As of 2021, The European Central Bank and the European Commission are responsible for maintaining value and stability to the euro.
Compared to the United States Dollar, the euro is stable, widely used throughout stock markets, and can be exchanged throughout most countries throughout the world.
3) Japanese Yen (JPY)
I love the design of the Yen, there is literally a hole in the middle of some coins! I had the chance to use the Yen at Narita and Haneda airports. Huge airports had yen signs everywhere. It was the most expensive currency I had used in Asia. It too is used in the stock market and can be exchanged in most countries. I would also add the fact that there are tons and tons of Japanese tourists around the world. I remember once at the international arrival hall in Bogota where a young Japanese man was struggling to communicate with the airport staff.
A kind lady asked me if I could speak English. I replied, yes I do in which she quickly pulled me to the side and told me to ask the Japanese man where he was going to stay in Cartagena, a great tourist location in Colombia. The man was a bit confused as his English skills were not the best. This is totally understandable, especially if you are just trying to chill n the beach and not have airport staff all in your face.
I luckily managed to help the young man. He smiled and continued to proceed to regional departures. It was one of the few times I felt extremely happy to have showcased my language skills on the spot. As he proceeded, I stood there wondering how much his Yen was worth in Colombian pesos. Nonetheless, money is a language of its own.
4) British Pound (GBP)
The famous "quid" or "sterling" is the Queen's currency. Think about that for a moment! The pound is one of the world's oldest currencies, if not the oldest. The word pound originates from the Latin word "libra" which translates to weight and balance. Currently, there are only four countries whose currency is the pound. These being Scotland, Wales, Northern Ireland. and England, all of which make up the United Kingdom.
The first time I ever saw a quid was at the Gatwick International Airport. Including the exchange rate fee, conversion rate, and usage of an atm, I quickly saw my 100 dollars turn into 60 pounds! Absolutely absurd! Which in doubt made me understand most people traveling to the United States, especially California.
Interestingly, like the Chinese Renminbi (Yuan) most if not all banknotes feature the face of the same person. For the Yuan its former Chairman of the Peoples Republic of China Mao Zedong, while the British pound features queen Elizabeth II in her younger years.
Unlike other currency denominations, the pound's highest denomination is 50. However, 50 quid as of August of 2021 is 7o USD. A whole 20 dollar bill more! The Pound is the world's most expensive currency, traded globally, and can be found at most currency exchange locations.
While worth more than the dollar, euro, and yen, the pound is not commonly traded with other world travelers. This is because you would have to give way more for a pound than any other currency. This logic just does not make sense. On the flip side, if you do happen to have a couple of pounds than consider yourself lucky!
5) Swiss Franc (CHF)
While living in Germany, I had the opportunity to go to Switzerland. The land of the Alps, languages, wealthy people, and fresh air. It is also the land of the most expensive currencies held in my hands. I mean when I tell you a can coca-cola costs 7 francs, 7 francs! then you would understand. I mean Mcdonald's was not even cheap! Mostly everything in Switzerland with a price tag including the train is priced quite high.
The franc is closely intertwined with the euro in that they are almost the same in value, especially when compared to the dollar. However, when most prices are above 5 francs (that is to say roughly 6 dollars) then you would also lift your eyebrows in surprise. This means my canned coca-cola was 7 dollars!
Imagine handing someone a 1000 franc note as a tip. At first, I'm sure someone would look at you and say oh another 1000 European notes. Must be forint since those can come in 10000. Then when they go to see in reality is a 1000 franc note worth thousands of dollars. I'm sure they would lift their eyebrows.
The next time you travel, remember the face value of a bill might not always be what it seems.
There are many types of currencies around the world such as the Indian Rupee, Chinese Yuan, UAE Dirham, Peruvian Sol, Colombian Peso, the list is endless. Regardless, always understand the economics of scale and buying power as it influences the world around us. The next time you hear someone ask you for a dollar, sit back and put yourself in their shoes. A dollar can go a long way!