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American Morning
Minding Your Business: Dollar Daze
Aired May 21, 2003 - 07:41 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BILL HEMMER, CNN ANCHOR: The question today: Does a lower dollar make a lighter wallet?
Andy Serwer is minding our business, trying to get his voice back.
ANDY SERWER, "FORTUNE" MAGAZINE: I am, yes.
BILL HEMMER, CNN ANCHOR: Slowly but surely it's coming back.
SERWER: A little bit. I still sound like Lou Rawls today, don't you think?
SOPHIE CHOI, CNN ANCHOR: That's not a bad thing.
SERWER: A lot of people like that.
CHOI: Yes.
SERWER: OK. Let's talk about the weak dollar. If you've been looking at the headlines, you might have heard about this. I guess the big question for everyone is: Who cares? What does it mean to me? There are implications, though, a lot of times they take longer to work themselves into the economy.
I want to talk about some of the immediate ones, though. First of all, if you're traveling to Europe, that's got to be the biggie. Vacations this summer, it will cost you more. The dollar is at a four-year low versus the euro. That's about $1.17.
And, you know, you can look at this by the "Big Mac Index," OK? A Big Mac costs an average of 2.71 here in the U.S. In Europe it will cost you almost $3, and in places like Switzerland it will cost you $4.50. Still a good deal in Canada and Asia, but even those currencies are also increasing. So, while you can save money going north of the border, things a little bit more than they used to be.
A couple of other areas we need to talk about: imports, imported goods into the United States. We're talking about electronics, we're talking about cars, we're talking about French wine, which Jack Cafferty stocks up on I'm sure. These are things that the prices may go up eventually, over the next couple of months. At first, companies abroad do not like to raise prices, because if people see that a camera costs $50 more, they're simply not going to buy it. So, they eat it. They eat the price increase. These are foreign companies.
But if the dollar stays weak, look for increases on consumer electronics particularly. A lot of Japanese cars, though, now are made here, so that won't affect them at all.
And also, there are a couple of other areas: foreign stocks, a good time to invest overseas. And also, if you work for a big company, like Coca-Cola or IBM, that helps them because their goods are cheaper abroad, so you might look for better results from bigger companies that export overseas.
CHOI: Alan Greenspan speaking today. Anything to look out for from him?
SERWER: He may -- yes, Sophie, he's speaking at 9:30 on the Hill, and he may be hinting at lower interest rates. So, we'll have to watch that one.
CHOI: OK, big news there.
SERWER: Yes, it could be.
CHOI: Yes. So, he's not going to talk about his commercial?
SERWER: No, I hope not. I mean, unless -- has he called you guys about some tips?
(CROSSTALK)
CHOI: No. OK.
SERWER: All right.
CHOI: Thank you.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com.
Aired May 21, 2003 - 07:41 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BILL HEMMER, CNN ANCHOR: The question today: Does a lower dollar make a lighter wallet?
Andy Serwer is minding our business, trying to get his voice back.
ANDY SERWER, "FORTUNE" MAGAZINE: I am, yes.
BILL HEMMER, CNN ANCHOR: Slowly but surely it's coming back.
SERWER: A little bit. I still sound like Lou Rawls today, don't you think?
SOPHIE CHOI, CNN ANCHOR: That's not a bad thing.
SERWER: A lot of people like that.
CHOI: Yes.
SERWER: OK. Let's talk about the weak dollar. If you've been looking at the headlines, you might have heard about this. I guess the big question for everyone is: Who cares? What does it mean to me? There are implications, though, a lot of times they take longer to work themselves into the economy.
I want to talk about some of the immediate ones, though. First of all, if you're traveling to Europe, that's got to be the biggie. Vacations this summer, it will cost you more. The dollar is at a four-year low versus the euro. That's about $1.17.
And, you know, you can look at this by the "Big Mac Index," OK? A Big Mac costs an average of 2.71 here in the U.S. In Europe it will cost you almost $3, and in places like Switzerland it will cost you $4.50. Still a good deal in Canada and Asia, but even those currencies are also increasing. So, while you can save money going north of the border, things a little bit more than they used to be.
A couple of other areas we need to talk about: imports, imported goods into the United States. We're talking about electronics, we're talking about cars, we're talking about French wine, which Jack Cafferty stocks up on I'm sure. These are things that the prices may go up eventually, over the next couple of months. At first, companies abroad do not like to raise prices, because if people see that a camera costs $50 more, they're simply not going to buy it. So, they eat it. They eat the price increase. These are foreign companies.
But if the dollar stays weak, look for increases on consumer electronics particularly. A lot of Japanese cars, though, now are made here, so that won't affect them at all.
And also, there are a couple of other areas: foreign stocks, a good time to invest overseas. And also, if you work for a big company, like Coca-Cola or IBM, that helps them because their goods are cheaper abroad, so you might look for better results from bigger companies that export overseas.
CHOI: Alan Greenspan speaking today. Anything to look out for from him?
SERWER: He may -- yes, Sophie, he's speaking at 9:30 on the Hill, and he may be hinting at lower interest rates. So, we'll have to watch that one.
CHOI: OK, big news there.
SERWER: Yes, it could be.
CHOI: Yes. So, he's not going to talk about his commercial?
SERWER: No, I hope not. I mean, unless -- has he called you guys about some tips?
(CROSSTALK)
CHOI: No. OK.
SERWER: All right.
CHOI: Thank you.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com.
