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[Squalidangel]

Originally posted by Tuttle+Jan 4 2005, 03:02 AM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (Tuttle @ Jan 4 2005, 03:02 AM)</td></tr><tr><td id='QUOTE'> <!--QuoteBegin-Squalidangel@Jan 4 2005, 01:02 PM
I know this is confusing but I don't know how else to ask what I want to know. I really don't know how exchange rates work.

Okay, pretend that you're in a country that only uses silver coins, and I'm in a country that only uses gold coins. Also pretend that the exchange rate is 10 silver = 1 gold (to keep the maths simple).

If you donate 50 silver coins to me through PayPal, I'm going to get 5 gold coins in my account because of the exchange rate. At first glance, that looks like a pretty bad deal. But the important thing to remember is that what I pay for stuff in gold coins is nothing like what you pay for stuff in silver coins. If a month of web hosting costs you 30 silver coins, it'll probably only cost me around 3 gold coins anyway. Or if I want to use a web host in your country, the credit card company will take that 30 silver fee and convert it back into 3 gold using about the same exchange rate.

That's pretty much all there is to it. The rates are never quite that nice, because there's gotta be a bit of room so that if you convert from one currency to another and straight back again then the bank gets a cut. They also vary a bit from time to time, so while my 5 gold coins might be worth 50 silvers this week, next week I might get 52 for them, and the week after only 49. [/b][/quote]
Thanks . That is what I was trying to figure out. I guess there isn't a wat (easy or not) to cheat the system.