Yesterday I withdrew 200 Euros from a cash machine in France. Later when I went on line, I learned that equated to a $291 checking account withdrawal not including the service fees. I could only grimace. For years now, as an American, I have been experiencing bad burgernomics in Europe.
The Economist magazine coined the word burgernomics back in 1986 when they introduced the Big Mac Index as a semi-humorous method predicting exchange rate movements between two currencies. The concept was to select a product that is readily available around the world to determine its Purchase Price Parity. I will not bore you with the details of the complicated formula, but the American dollar is seriously under valued here in Europe. According to my calculations, 25%. No surprise the Economist later created other global currency measures, the Tall Latte index and the iPod index.
Reflecting on the bad burgernomics I have experienced over the years here in France, I decided to create my own index to justify one of the reasons I keep coming back. It is called the Géant Food index. Géant is France’s leading supermarket chain. A 1.5 liter bottle of Evian is .66 Euros or the equivalent of $.96 for one and a half large bottles in the States. An average baguette is .92 Euros or $1.33 in the States, considerably cheaper than the baguettes at Whole Foods. Candidly, I do not come here to live on bread and water alone. Overall all the food is considerably cheaper than the States – the produce, cheese, fish dripping from the Mediterranean, etc. Let’s not forget the wine. Why is the Géant Food index favorable here? A majority of the food is local, thus I am not paying for the transportation. Remember, the average food travels 1,500 miles from source to plate in the States. So today, not only am I going to eat some great fresh food, I am also going to be environmentally responsible eating a locally sustainable meal with a favorable carbon footprint.
Just paid 5.80 Euros for a Big Mac
Translates to $8.43 at today’s exchange rate
Ate it and had a Big Heart Attack