How low dollar is good for Brazil and the U.S.

I remember when I first came to the U.S., back in 1984. A little child in Brazil, Disney and one-block wide toy stores were the dream.

When I finally arrived, the shopping cart was quickly full, to my parents despair. I didn't care much for the price then, and much less for the exchange rate.

As 2008 starts, a weird sense of déjà vu has hit me.

It turns out, 24 years later, I actually deserve to have that feeling (not that my parents will cover the bill this time). According to the Brazilian Central Bank, the real – the current Brazilian currency, 12nd in its post-colonial History – has almost doubled its value compared to the dollar between 2003 and now. While in early 2003 one dollar was worth 3.53 reals, it's now worth 1.77 reals.

Great news for Brazil. Great news for the United States, too.

When Lula came into office for his first term, on January 1, 2003, many predicted the country would soon explode. The then-perennial presidential candidate had always had a Che Guevarian air of revolution, beard and all. Five years later, however, the country is still standing, aside maybe from a hangar here or there in a São Paulo airport.

Building on the stability left by also two-term Cardoso, Lula helped the country fight inflation and keep a positive commercial balance that has left Brazil with more than $167 billion dollars in foreign reserves at this point. A tiny portion may have come from an Amazon tree or two, as Al Gore would point out, but most of it has come from a solid government strategy carried by leftist and rightist parties alike. Eat this, Republicans and Democrats.

So how is this good for the U.S.?

Simply put, it encourages tourism. From the point of view of a Brazilian living in the U.S., it's been a long time since I last saw so many of my countrymen and women and children visiting the U.S.

With the real so valued against the dollar – the most among Latin countries – more Brazilians can afford the plane ticket, the hotel, and the eight dozen receipts that follow. Mickey Mouse and Best Buy are not covered in gold anymore, and have become part of their reality once again. Some may even buy huge HDTVs, only to find out later that it doesn't work back in Brazil (different broadcasting systems). The more those travelers come, the more money they spend.

Good for one, good for the other. Good deal.