Cereal and Economics

So, as I may have mentioned before, my grocery store posted a sign a few months back declaring that they would no longer carry Kellogg's cereal as it did not allow them to make a profit. Instead, the management suggested you may try Nestle or TIP (the store brand). I was devistated as I had only recently started eating Special K since Rasin Bran is no where to be found in Germany. I bought two boxes and paced myself. Finally I ran out of cereal last week. I put it on my shopping list and prepared myself to consider something new as I walked to the last isle (where they keep the cereal). I walked by the Nestle products uninspired and then I found Special K and new flavors. Indeed they did not stop selling it but they raised the price. When reading that sign months before I wondered to Patrick why they would not just raise the price. So now I have a new flavor - Special K Cranberry Vanilla. As I tasted my new cereal this morning I began to think about how expensive cereal is. My 300g box which is equal to about 10oz. cost 2.99 EUR. I looked at peapod.com to see how much the same cereal would cost from Stop and Shop and Special K is about .27 cents per ounce, depending on the size of the box and the variety. Anyway, that's about $2.70 in the US for the same box I pay 2.99EUR for (I think it used to be 2.69 before they threarened to stop selling it actually) in Germany. In numbers, that's a difference I would never thing about but considering the current rate of exchange that's $4.44 and rising by the minute. This is where the economy comes in. When the Euro was first introduced (begining of 2002), it was intended to be equal or almost equal to the USD. In the begining it was even less than the USD. So, one would assume these prices were set to equal those of the USD in number not value which is evdent in a lot of things like clothing and electronics and even my cereal. However, over the years, the Euro has proved to be valued higher than the USD but prices have not been adjusted to reflect this. American companies love it becasue even now as the US slumpsi nto a recession, American companies with business abroad are making up for their loss of domestic products with foreign sales. This is also an asset to mutlinational companies who have a strong market outside of the US, especially in the luxury goods market. Companies with a US focus in high end goods are seeing the recession while true multinationals with strong markets in Japan and Europe and the Middle East are not hit as hard. So, I feel like ther needs to be a lesson here and maybe it is diversify your assets or invest in currency exchanges or maybe it is don't try to live in an Euro economy on a Dollar income. Or just enjoy your cereal :)