Will the Dominican Peso ever go back to be One to One with the Dollar like back in 1983/1984 (February)

cavok

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It should be noted that before the current Dominican Peso was created by Trujillo in the 1940's, the legal currency was the US Dollar. After Trujillo paid off the national debt, he created the Dominican Peso along with other things such as the Central Bank and BanReservas. The DR has been one of the few countries in the world to pay its foreign debt. Oh well, DR is back to being mediocre again owning money to everybody (a debt that will never be paid back, mind you).
Trujillo doesn't get enough credit for that. He paid off all the national debt.
 
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As a friend recently reminded me - Good for tourists, not so good for Dominicans.
Which is exactly why an orderly peso decline is in the cards.................tourism.......and exports.

The DR has seemingly tied its boat to tourism and exports.............both of which benefit from a cheaper peso...............thus the future for the peso is likely a continued orderly decline...................unless of course they abandon tourism and exports.

Respectfully,
Playacaribe2
 

chico bill

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Poor wording on my part. What I meant by "drop" is to go down to, say, 25 to the USD.
When the peso falls they just jack prices so they get equal dollar value. Then if the dollar goes back up they don't reverse the peso prices - we loose
 
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Poor wording on my part. What I meant by "drop" is to go down to, say, 25 to the USD.
If the peso went to 25:1, both tourism and exports would slow fairly quickly. That is a 50% increase in the pesos value against the dollar .....or put another way, a 50% decrease in the purchasing power of any tourists. Tourist meccas like Mexico would salivate if that were to happen.


Respectfully,
Playacaribe2
 

cavok

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Suppose a dinner at a restaurant here now costs $20 USD. If the peso strengthens to 27/USD, that dinner will now cost $40USD. At about 14/USD, the dinner will cost $80USD. At 7/USD, it will cost $160USD. At 3.5/USD, it will cost $320USD. At 1.75/USD, it will cost $640USD. At 1/USD, it will cost about $1100USD. And that's assuming the price in pesos stays constant. This will never happen in 10 to 15 years.
 
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Suppose a dinner at a restaurant here now costs $20 USD. If the peso strengthens to 27/USD, that dinner will now cost $40USD. At about 14/USD, the dinner will cost $80USD. At 7/USD, it will cost $160USD. At 3.5/USD, it will cost $320USD. At 1.75/USD, it will cost $640USD. At 1/USD, it will cost about $1100USD. And that's assuming the price in pesos stays constant. This will never happen in 10 to 15 years.
Exactly.

1:1 with the current peso is not likely.

100:1 is more likely.

As has been pointed out above, that will hurt the average Dominican who is paid/buys in pesos........but it will help to continue to stimulate tourism/exports...........the staples of the current Dominican economy.

I am curious as to how long the government can continue to increase wages, subsidize the food basket, and how long they can continue to absorb the costs of gasoline.................before the adverse effects on the peso begin. So far they have managed...............but they cannot do this forever.


Respectfully,
Playacaribe2
 

CristoRey

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Suppose a dinner at a restaurant here now costs $20 USD. If the peso strengthens to 27/USD, that dinner will now cost $40USD. At about 14/USD, the dinner will cost $80USD. At 7/USD, it will cost $160USD. At 3.5/USD, it will cost $320USD. At 1.75/USD, it will cost $640USD. At 1/USD, it will cost about $1100USD. And that's assuming the price in pesos stays constant. This will never happen in 10 to 15 years.
If the dollar takes a big enough hit it most certainly could. Venezuelans were saying the exact same thing 25 years ago.
 

cavok

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If the dollar takes a big enough hit it most certainly could. Venezuelans were saying the exact same thing 25 years ago.
You really can't compare the US to places like Venezuela or Zimbabwe. If an average dinner costs $1100USD any time soon, there will be a lot more to worry about than the peso exchange rate and nobody will be coming to the DR except billionaires on their private jets.
 

pinonuevo

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What about to introduce the Dominican Dollar; the $DD where you bring in to the bank 60.00 pesos and and you get a Dominican Dollar that is par with the US Dollar
 
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What about to introduce the Dominican Dollar; the $DD where you bring in to the bank 60.00 pesos and and you get a Dominican Dollar that is par with the US Dollar
Now there is another unrealistic get rich quick idea.

Better idea..............and more realistic...........bring in 120 pesos and get a Dominican Dollar...........that would probably last for at least 6 months or so.

Respectfully,
Playacaribe2
 
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man your a mathematician
Gets even more complicated though when you have to explain that 100 centavos equals one peso. Lots of zeroes..........they may need to import those mathematicians from Venezuela...............they have lots of experience with zeroes..............

Not to worry though, chicklets will be making a comeback to help round out/finalize the transaction.


Respectfully,
Playacaribe2
 
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Big

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Gets even more complicated though when you have to explain that 100 centavos equals one peso. Lots of zeroes..........they may need to import those mathematicians from Venezuela...............they have lots of experience with zeroes..............

Not to worry though, chicklets will be making a comeback to help round out/finalize the transaction.


Respectfully,
Playacaribe2
I hear ya. Even in the U.S if you ask 10 people on the street how many millions are in a billion only 4 will get it correct
 
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