Europeans clean up as the dollar falters

By MARSHA MERCER

MEDIA GENERAL NEWS SERVICE

WASHINGTON — The darling young French couple was new to the States and needed furnishings for their historic townhouse in Alexandria, Va.

They wanted nice things, they confided to an elderly antiques dealer in a high-end shop, but they couldn’t spend a lot.

The dealer took the charming pair under her wing, bringing in tables and chairs from her home and offering the couple her very best prices. She even ferried them to the grocery store before they got a car.

The couple bought some nice antiques. So grateful, they laughed, hugged and kissed their new American friend and promised her a home-cooked French meal.

A week or so later, though, when I stopped by the shop and heard the story, the glow of international goodwill had dimmed considerably.

Too late, the antiques dealer realized her customers could have paid a lot more. They were French, not Americans, and their money goes farther than ours these days. A price that’s reasonable in dollars turns out to be a pittance in euros.

In a classic case of seller’s remorse, the dealer felt she’d practically given away her American treasures. No matter that her “best” prices were still too high for local browsers like me.

This holiday shopping season has a dual personality. Americans, long disparaged by many in Europe for throwing money around, find themselves holding fast to the wrong currency. The almighty dollar is still green, but it’s a sickly hue.

Europeans are flush with cash. The robust euro and British pound have been gaining steadily against the dollar since August and stand at record highs against the dollar. Last week, the pound was worth $2-and-change and the euro hovered near $1.50.

How bad is the dollar’s slide? In his new video, “Blue Magic,” rapper Jay-Z flashes euros, not dollars.

European shoppers land here by the thousands, toting empty suitcases to fill with the bargains of a lifetime.

Swarms of shoppers

The shoppers swarm New York where, according to USA Today, at the Manolo Blahnik USA store in Manhattan they can pay $600 for shoes that would cost the equivalent of $823 at the Blahnik store in London. Let’s all hum “God bless America.”

The New York shopping spree is so intense that London’s Sunday Times on Nov. 11 advised its readers to travel beyond the Big Apple. Here’s a taste of Chris Haslam’s article:

“With the pound currently over the $2 mark, we’ll all filthy rich and the Americans are all broke. Which means we’re all invading bargain-basement New York — bookings are up 20 percent on last year...”

Beat the crowds by venturing to Boston, Washington, Miami or Chicago, said Haslam.

In Washington, the Lincoln Memorial, Vietnam wall and other monuments “offer sober glimpses into the American soul,” Haslam said, and, “Since you’re loaded, hire a guide...”

Drink $12 cocktails named for first ladies. In Boston, eat a lobster roll for just $20. In Miami, rent a convertible for about $50 a day, about one-fourth the cost in Europe.

So, as you head out for holiday shopping, be prepared. There’s an inevitable disconnect the first time you hear accented voices burbling over how cheap something is — that isn’t cheap at all. In a fancy department store, Germans grabbed at expensive clothes as though they were working a blue-light special. I wondered if markdowns would bring the cost to something reasonable to Americans in a few weeks.

A weak dollar may come with a national psychological cost, says Kathleen Vohs of the University of Minnesota, who has researched the psychology of money.

“You can see that when a home currency is weak, people just have a sense of inferiority in the world,” Vohs told the Associated Press.

Even if Americans don’t feel inferior, they may be unpleasantly surprised to find that some Brits and western Europeans see the cratering dollar as a metaphor for the diminution of American power and influence in the world in the 21st century. Whatever.

Americans finally can have the smug satisfaction of sitting back and shaking our heads about free-spending Europeans. If they want to throw their money around on stupidly expensive shoes, rented convertibles and cocktails with silly names, let them. It’s a free country.

X Marsha Mercer is Washington bureau chief for Media General News Service.