Despite it being a stronger currency, is it exchangeable in the United States for dollars? Would that mean I’ll be getting more in dollars due to that having high value? Also, why is the Swiss Franc more colorful in its appearance while US Dollars look rather bland in comparison? To break down each denomination’s value:
| CHF | ~ in USD |
|---|---|
| Fr. 1000 | $1278 |
| Fr. 200 | $255 |
| Fr. 100 | $127 |
| Fr. 50 | $63 |
| Fr. 20 | $25 |
| Fr. 10 | $12 |
Meanwhile, the value of US Dollar is lower in comparison to the Franc:
| USD | ~ in CHF |
|---|---|
| $100 | Fr. 78.30 |
| $50 | Fr. 39.15 |
| $20 | Fr. 15.66 |
| $10 | Fr. 7.83 |
| $5 | Fr. 3.92 |
| $2 | Fr. 1.57 |
| $1 | Fr. 0.78 |
The lowest bill denomination is Fr. 10 (or $12) so anything below that is issued in coins. But, the real indicator is the Big Mac Index: for instance, the burger in Swiss McDonalds is Fr. 7.30 ($8) with VAT included while the same thing is $5.79 (before tax) in the USA meaning you have to pay more for the same item.
However the mininum wage in Geneva (with a population bit less than Scotsdale or Boise) alone is Fr. 24.59 ($31.40) per hour, while the minimum wage in let’s say Seattle is $20.76 per hour so technically, the Swiss have more money. Just because of their currency’s value, it makes US Dollar look cheap.
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Would that mean I’ll be getting more in dollars due to that having high value?
You posted the answer yourself.
Every central bank designs its own bills. The US chose to be boring, bland, and hostile to people with visual impairments. The reason why they won’t change that in a hurry is because it would necessitate an expensive switch in vending machines to handle different size bills. They could change the color but greenback is their brand. European currencies have pretty much always had bills of different sizes.
The exchange rate of currencies depend on many things. Prices depend on many things. Comparing Swiss ones with American ones is almost pointless. Switzerland has high VAT rates (high taxes in general) and thus salary levels will be higher as well. Swiss tourist will go nuts spending stateside because everything will just be cheap to them. Because they won’t finance social security, universal health care, or a bunker place for every citizen in case of thermonuclear war in the US. But they do in Switzerland.
Nominal value of currency doesn’t matter that much.
Important: I don’t mean the changes in that value. They matter a lot.
When I was in Switzerland everything seemed stupid expensive. $15 for a Starbucks coffee. $40 for a hamburger. This was like 10 years ago, so probably even more now.
I was in Switzerland for 2 last weeks. It’s stupidly cheap there, when you factor the income of the swiss people.
The median income in Switzerland is 1,5 times that of the US, almost 2 times more than Germany and 4,5 times of Poland (the country I come from).
Yes, Switzerland is 2-3 times more expensive than Poland, but I’d take this deal every day of the week.
I think the prices are more or less the same today.
But we don’t go to Starbucks or fast food often, the coffee culture is the same as France and Italy so not Starbucks. And fast food is often the hangover food so not something you do every week.
Since Covid and inflation worldwide, some prices are actually cheaper in Switzerland. With a Swiss income it is a very perfect country to live in (not with a basic low 4000 chf/month tho, at least not in cities)
This got way longer than expected but the tldr is: foreign exchange is super complex and depends on a lot of factors which don’t matter to you as money user. I tried to give a few examples below.
Plus: You’re mixing up two very different concepts:
Fiat evaluation and purchasing power.
First, money;
“More worth” is a natural instinct but doesn’t reflect how the money market works: it’s a question of how much of that money is in circulation as well for example:
1107650 CHF Million 19396,90 USD Billion
(Source tradingeconomics.com ).
So while it’s the CHF is slightly over value when compared one to one the picture is different when you look at total money available. Then you look at production capacity, glue creation and supply and demand for those currencies. All of this will flow into the price.
The minimum wage discussion is a completely different one: here you need to compare minimum wage to the purchasing power of the area you are looking at and take into consideration how the tax and financial situation changes to be able to compare it.
There’s for example concept called big Mac index which is a crude way of showing the difference: how much does MacDonald’s charge for their bullshit? They are everywhere and quite good at finding a acceptable local price.
If you want to dive deeper a key word to look for is the Gini Index with which the wealth distribution is quantified. I’m not good enough to explain it well though.
Now for the colors: design of money is the job of the nations (or unions) main bank to decide usually. The US seem to have the creativity of a washed down rock while others are more creative.
The Euro money for example is designed with guardrails by each member country but color, size and form are fixed and optimized to be easily recognized even with various visual impediments, which I personally really like.
Uh that’s not how currency exchange rate works.
lulz
