The overall inflation rate in the US remains quite low, well below that of past periods when the Fed was forced to raise interest rates to slow the economy and inflation. Fuel prices are up, but have already begun to decline, almost 10% in the last 30 days, but prices of fresh fruit, vegetables and meat have spiked, largely due to delivery costs. Obviously, you don't recall real "inflation" if you believe that today's conditions qualify.

But to claim major inflation in the US may requires a perspective only possible from Detroit, a city about as dynamic as Egypt's Valley of the Kings, little more than a memorial mausoleum for the past glories of the automotive industry

If the Fed raises rates, the economy will slow dramatically and inflation will surge. Why would anyone want those conditions? While earnings on CDs and similar "investments" (which are not investments at all) remain at low levels, paralleling loan rates as they always do, equities markets remain on the up-tick.

I'll trade cheap dollars which allow US products and services to be bargains for foreign buyers to "expensive" dollars any day. Foreign travel makes up a modest portion of US expenditures abroad, and we'd do far better by increasing domestic drilling and oil/natural production (which would lower oil and gas prices). A bit of cheap gas would offset the look of and pain from drilling rigs in ANWR and the Santa Barbara Channel.

In the last couple of years, several of the interior resort towns of Mexico remain bargains as do Canada's Maritimes. Your own UP has some pleasant secret hideaways, and my wife and I have had good but not expensive visits to Sicily and Portugal. When the value of the dollar declines, all sorts of vacation spots heavily dependent on US tourists hold or even lower prices (and although the Euro remains high, economies in several major European countries grow at a lesser rate than does that of the US, meaning that many Europeans have fewer Euros to spend.

Of course, officially and otherwise, we in the US do an abysmal job of promoting foreign tourism, less effective than several tiny European states.

Since you mentioned Eastern Europe....
 

Just spent the month of June there. Prague isn't the value it once was, but it's still very affordable, a nice break from the Euro Zone and a fun place to be. Poland is still ridiculously cheap. 50 Zlotys, which was about $18 was more than enough for a weekend travel from Krakow out to Auschwitz and expenditures there. Even being back in Prague hurt after that.

I'm surprised no one has mentioned Turkey. Easy to get to, lovely people who don't want to kill us (obviously staying in the Western part of the country), great beaches and tremendous value.

We've done much better in Eastern Europe- Prague, Budapest and Athens. Not great bargains, but very reasonable compared to London or Zurich, where I travel only on business.

I'm not sold by the relative decline of the Yen. Declined compared to what? Do agree with Eastern Europe comments, especially going beyond the capitals. You mentioned you already went to Argentina - was that only Buenos Aires or did you venture to other parts of the country? I was in Mendoza in May and found prices there considerably lower than those in B.A. Pleanty of hotel choices, great (dry) weather, the Andes at your doorstep and most importantly lots of wineries to explore. Check the Mendoza thread in the Argentina section. Consider also Iguazu, Salta or Cordoba.

I went to Japan three times. First time in 2001 it was 130Y/$1. 2nd time in 02 it was 110Y/$1, and now it's around 120Y/$1.

Compared to how the USD has done against most of the world, it's a decline.

Anyways, another bargin is China. The Yuan has firmed up a bit but really isn't making a huge difference. Massages are $10 (if that) and bottles of water are 15 cents.

It's not a resort place... more of a place with historical sites, if that's something you're into.

I agree that Japan is a relative bargain for an advanced country. Compared to Europe it is very good value.

It was terribly expensive years ago, but many years of no inflation or even deflation have brought prices way down. Certainly cheaper than New York City these days. And way cheaper than London or Paris.

Now, if they could just cool off the Summer temps.

By the way there has been extensive discussion of this issue in the Japan forum

Most of Central and South America is still an excellent value!
 

I realize these places, especially Colombia, are not for everybody, but I thoroughly enjoy them.

The currency of Argentina and Peru has been very steady against the dollar at approx. 3:1. The Colombian peso has appreciated a lot in the past 18 months, but should level off.

Most Central American currencies (Costa Rican colon, Honduran lempira) have actually been sliding.

Off the beaten track, there are Bolivia and Paraguay with very low pricing.

I did not encounter any maltreatment for carrying a US passport anywhere. There was graffiti in Buenos Aires saying " Bush afuera!" but what's there to disagree with?

But let's not forget that everything costs a bit more there because it has to be shipped in. I was in Oz/Nz in 2003 and it was not the bargain I thought it would be. Great fun just more expensive than had thought.

I'm not a naysayer as far as SE Asia goes. I spend at least 6 months a year there. However, I'm not a cheerleader for one particular travel destination because I've found that what some may find great others hate...

That said most places right now are not the bargains for americans they once were because of the declining american dollar. Its cyclical in a few years it will change...

We were in BA and Patagonia this past January. I agree that Mendoza would be great to visit and I am sure we will do so, but would like to go somewhere different. Would definitely recommend Argentina as a varied, lovely, interesting, and a very good value for travel. With their peso at about 3/dollar most things are very inexpensive by our standards and the quality of the food and wine if very good.

I was in Ghana last year and I was a millionaire for a brief time!! I exchanged $100 USD and received 1 million Cedis. :)

The people are friendly and living is pretty cheap. The country is more peaceful than many in Africa. There have been some instances of bird flu, I have read, but just don't mess with chickens.

Oh, and avoid grasscutter soup at all costs. Blech!!

Eastern Europe and Southern Africa

They've had deals there? I've never seen that place under $300 a night.

I'm one of those old-school people who thinks strong economies should have strong currencies. You don't build over the long term on a weak currency. Usually if the dollar is down it's a bad sign. Countries with export-oriented economies have resorted to artificial means if necessary to depress their currencies and keep the exports competitive, but it really shortchanges their consumers and retards development of their own mass markets that could free them of dependence on markets like the U.S. The global economy has some unhealthy and ultimately unsustainable imbalances there.

I think the bigger part of the problem I'm seeing in parts of SE Asia is price increases driven in part by inflation, but mostly by supply/demand. Some of it was arguably pent-up, and the part that related strictly to tourism (like hotels) could tank suddenly with another major event.

Have never thought of Australia as particularly cheap. The A$ seems to trade in a narrower range than the NZ$, and of course getting around the big country can be an expense. The NZ$ seems to have bigger swings that can make the country a bargain at times, though usually not over long periods of time.