I hear this constantly. Including from people who are very well versed in finance.
"If I moved to the US from Canada I'd be poorer, the USD is so strong!"
"I would love to visit London but GBP is so expensive!"
"Wow Jordan is a wealthy country, 1 JOD is 40% stronger than 1 USD"
Yes, crappy economies are often associated with abysmally low currency exchange rates, likely due to decades of uncontrolled inflation (Vietnam, Argentine, Turkey, etc.). But the current exchange rate isn't the indicator of how weak or strong the currency is. It could be redenominated at any moment with no impact on the economy.
This phenomenon has to have a name? Some sort of cognitive bias?
Why do most people think a currency with a high exchange rate = strong, wealthy country?
byu/Gridsquare_Collector inAskEconomics
Posted by Gridsquare_Collector