So much depends on context.

It is one thing when your wife of 30 years announces that it is time for bed. The words have an entirely different effect, on the other hand, when the 30-year-old blonde you just met in a bar says them.

Our brother is visiting and finds things about the same…and yet very different… in Europe.

"A taxi from the airport costs the same amount. It's about the same amount in a restaurant. Everything is about the same - I mean the numbers are the same. It costs 30 for a taxi…80 for a nice dinner…etc. But a pound is twice as much as a dollar.

"It makes me think we have it very good in Virginia. You remember that house down near Charlottesville? It sits on a hill overlooking the Rockfish river? It's a beautiful place, with 60 acres…horse-barns…pastures…and the house was probably designed by one of Jefferson's followers. It's got that mellow brick…very pretty place.

"Well, the market is getting soft down there now. Prices are falling, they say. But what is really falling really are people's expectations. Buyers now expect that they'll be able to get a reduction. And sellers now no longer expect those huge gains that we saw a couple of years ago.

"Well, I had that place on the market for $1 million. It's now been more than a year and all we've had are a couple of offers around $700,000. But my point is that $1 million buys you a lot in America - even in a hot area like Charlottesville. Of course, this place is a little far out from the city. But over here, a million won't buy you much of anything."

Thinking along similar lines, our friend, Steve Sjuggerud has come to the conclusion that the dollar is undervalued. Spending dollars in America, you get a lot more for your money than spending dollars in Europe. In the context of purchasing power, he says, the dollar really ought to be rising.

But think about it like this. Americans spend more than they make, and the U.S. trade deficit is more than three-quarters of a trillion dollars annually. The dollar is, thus, effectively, America's I.O.U. There are already trillions of these things in stuffed mattresses, wallets and vaults all over the world. People still seem to want them, no doubt, and governments and corporations continue to offer dollar-based debt at a fantastic rate. But as the quantity increases, it only seems fair that the quality should decrease. Each additional I.O.U. must have less in assets behind it. In the context of international monetary exchange, you'd think the dollar would fall.

Up or down? Both is our guess. In the years ahead, and here we're taking a wild guess, the dollar will probably buy more of some things and less of others. You will probably be able to get more stocks, for example.

Our colleague Christopher Hancock has been recommending an under-the-radar stock to his Free Market Investor readers - a company that has already piled up nearly four times more assets than it has debts. And that asset pile includes a heaping amount of pure cash. That makes this company extremely attractive, to say the least.

The current dividend yield on the S&P is only 1.8%. That is a market where the American already gets little for his dollars. Our guess is that he will get more - a lot more - sometime in the years ahead.

On the other hand, we are not sure he will get more toothpaste…or much more automobile. Production of things is increasing too - but not as fast as the output of dollars. Our guess is that he will get fewer things for his money in the years ahead. Already, we note a disturbing trend. The LA TIMES reports that breakfast is getting more expensive at an 8% per year clip. Why? Corn! Cereal prices generally, and corn in particular, are going up. So, the value of the dollar goes down relative to Kocoa Krispies or Frosted Flakes.

But what about housing? That's where most Americans have tucked away most of their money. Will the dollar buy more housing in 2010…or less?

Bill Bonner is the President of Agora Publishing. For more on Bill Bonner, visit The Daily Reckoning.