Getting over America when considering a winter holiday: Don Pittis

If you're moaning about the miserablestate of the Canadian dollar as you consider a U.S. winter holiday, maybe you should look farther afield.

It's true the loonie has plunged from more than$1 USin 2013 to an 11-year low of 73 cents. But outside the dollar zone, things don't look nearly so bad.

In fact, in some holiday destinationsthe loonie is worth more than it was at the beginning of this year.

• Canadian dollar dips below 73 cents US as oil sinks
• Jim Gray, oil patch legend says crude may fall to $30

As most of us know by now, the loonie used to be so highnot because Canadianswere so clever and hardworking well, not only that.

You may remember that then-opposition leader Tom Mulcair was pilloried for letting the words "Dutch disease" pass his lips.

That's the idea that money flooding into a country to invest in oil and resources, and then more money flooding in to buy those exports, pushesup the currency of big resource exporters like Canada.

Thetheory says theresulting high currency, theloonieinour case, leads to a collapse of non-resource industries as they are priced out of export markets.

• Is Canada suffering from 'Dutch disease'?

Pooh-poohedat the time,the idea that theloonieis to some extent apetro-currencynow is accepted bymost analysts.

But as the loonie falls with plunging oil,that's not all that is going on, as BMO senioreconomist Sal Gautierireminded us this week.

"As the loonie probes new 11-yearlows against the greenback amiddiving oil prices, it's worth noting thatthis is not just a weak commoditystory but a strong greenback tale, aswell," wroteGautieri in a BMOreport.

With everyone anticipating a U.S. recovery and a move by Fed chair Janet Yellen to raise interest rates onWednesday, money has been piling into the U.S. dollar, pushing that currency higher than it may deserve to be.

Although the Canadian dollar is down by 26 per centsince 2013 in U.S. dollar terms, Gautierisays"the loonie has fallen a moremoderate 10per cent against a basket of other currencies."

So where to holiday when the U.S. dollar is high?

The sterling shock

If you are considering a trip across the pond, theeuro is not the deal it was this spring when a loonie would buy about 75 euro cents.That is now down to about 67 cents.

Likewise, theBritish pound is not so good. These days, ittakes more that two loonies to buy 1, which makes every cup of tea and pint of bitter a nasty shock. If you must go, the only solution foravoiding mental anguishis to never, ever, convert the restaurant bill into Canadian dollars.

But for those willing to take a more adventurous holiday, there are plenty of countries where the currency has declined against the U.S. dollar even more than the loonie has.Yes, Canadian travellers actually get a better deal.

South America remains a good bet. In January you could buy two Brazilian realfor every loonie. Now you get about three.

But nearer to home, one of the best travel destinations to spend a loonieis already a Canadian favourite:Mexico.

Last January the Canadian dollar bought 11.60pesos. That'sabout 8.5 Canadian cents a peso. Right now, eachMexican peso costs less than eightcents, a rate of about 12.60 per loonie.

If you're taking a package deal, the low peso is no guarantee thatairlines and Mexican resorts willbe a whole lot cheaper than a year ago. But for adventurous travellers andsnowbirds with Mexican winter homes, the difference in the cost of living will be significant.

D'oh!Canada

Of course there is an even cheaper option. With the mild weather in many parts of our country, maybe Canadians won't need asouthern holiday this year.

Instead, we may have to head north.or up to higher altitudes, to enjoy some much needed winter recreation.

Sitting cozily by a roaring fire, you can think aboutall the money you'vesaved.

Follow Don on Twitter @don_pittis

More analysisby Don Pittis