4.03.2007

cookbook arbitrage

sadly for us all there were no hilarious kitchen hijinx surrounding last night's (very delicious) dinner (of seared lamb, potatoes boulangère, and this amazing peas-mint-and-wilted-butter-lettuce thing), but i did do some prep for tonight's quasilegitimate semi-seder. this prep largely involved going to barnes & noble to buy a copy of this month's Martha Stewart Living, which contains a recipe for a flourless strawberry tart that eoihjozicdj this is uninteresting.

what's interesting is that i saw a copy of this cookbook, Breakfast Lunch Tea, which is pretty and well-designed and which, on the back, lists the price in pounds, dollars, and euros:



the non-visually-impaired among you will notice that this book has an identical cost, whether you are spending dollars or euros. but according to today's exchange rates, a euro is equivalent to ~1.34 american dollars.

what does this mean?!?! funny you should ask. it means that if i were to buy one of these books in the US, jaunt off to paris on one of my infamous whims with it along for light reading, decide upon arrival in the city of light that it wasn't quite to my liking, and return it to a lenient bookstore for a credit of €29.95, after conversion back to US dollars i'd be pocketing a cool $40.05 - more then a hamilton more than my initial outlay. (we shall, for purposes of this gedankenexperiment, ignore the transaction costs inherent in e.g. getting to paris.)

anyway if i enact this on a large scale i will make a bazillion dollars. this is an utterly brilliant investment strategy that, so long as the dollar continues to suck goat, takes us tremendously far.

it's also worth noting that at today's rates, the £19.95 UK price would return us $39.47 - itself not quite sneezeworthy, but not nearly as mindblowingly amazing as the additional $0.58 that the euro brings to the table. pennies add up to dollars, you know. and dollars add up to happiness.

i am ignoring canada and australia because, ugh, colonies.

16 comments:

Marcin said...

This is the stupidest form of arbitrage I have heard of in a long time.

Any realistic version has been obviated by the introduction of Amazon. I'd be interested, instead, to hear your thoughts on some kind of global auction system to facilitate cross-border arbitrage.

helen said...

whatever, marcin. i don't see you becoming a bazillionaire. criticize my arbitrage when you find a better system.

as for a global auction (coughebaycough), i think an auction undermines the very notion of arbitrage, don't you?

ploop said...

marcin, leave off helen's arbitrages. I thought it was a great post and I shall personally be flying business class to NYC tonight to make the most of that book deal.

Marcin said...

In a word, Helen: No.

YHFYHBTHAND

Marcin said...

I should stop being so smug. It's not your fault that you don't have the high quality education in economics, business, and the internet that has been afforded me by reading the web all the time instead of working.

Neil said...

Sounds like a fine idea for being a gazillionaire. A gazillionaire's income gets taxed at 32%, no? Your $10.10 profit goes down to $6.86, or you could be smart about it and chalk it up to capital gains (which it's not, really), and pocket a cool $8.08. Though, how will you be accepting payment for the book you sell? With Visa or M/C, your profit goes down to about $7.50, with AmEx (bitches!) it goes down to about $7. And then there's the potential foreign transaction fee, which brings you back down to about $6. Build in fraud protections, currency exchange fees, commercial activity taxes, freight costs and the need for new outfits whenever you were to make one of your little skips across the big pond, and, well...you know.

Sorry, I was in a bad mood, and decided to take it out on your idealism. And thank you very much, I feel a little bit better now.

a lady said...

right. so.

can you creatively math away the difference between 150.00 and 599.99?

thanks.

Sean said...

But what is most important here is that you enjoyed your potato dish. Just think how many potatoes that additional ten-plus bucks could buy you!

James said...

I just want to jump on the bandwagon here and point out that your idea would never work.

I'll also note, for the edification of various stupid readers of your blog, that something very similar to this was the rationale underlying the original Ponzi scheme.

But mostly, Helen, you really screwed the pooch with this idea, because it would never work.

Matt Carman said...

The logical explanation being the heightened popularity of tea in the mother country and several mainland European nations v. These Insolent States, making a calculable and thus priceable difference between the two geographies. Making your scheme yet another capitalistic attempt to destroy the cultural differences that make this world wonderful. So congratulations, Ms. Disney Columbus, and enjoy your wave of mutilation.

helen said...

okay, everyone wins. i am a foolish girl, and have no grasp of how economics actually works. this is true. happy? yes.

a lady said...

I'm going to have to start calling you Ms. Disney Columbus. you realize this, right?

that or Filene.

petra jane said...

But you're not spending $29.99 on the book are you, sales tax is 8% or something isn't it? Your Parisian bookstore probably sells its cookbooks prix compris, avec tous les tarifs.

And ugh, colonies is about right. Try buying some graphic novels at around $12-20US and bring them for a holiday in New Zealand, you could make a 200-300% profit on reselling them. Outlandish!

Marcin said...

The EU applies VAT, not sales tax. Also, books may be exempt (they are in the UK).

Captain Smack said...

Ignore the nay-sayers, Helen. I think you're on to something here.

I have a friend who tried something very similar, only instead of cook books, he did it with illegal narcotics. Made a TON of money, too.

Alexis said...

i'm gonna have to agree with the captain here...
maybe you just need someone overseas to be in on it with you. you know, like those people who always email about "transferring funds"?

ps. i do so enjoy your blog! pure wit.