Yes, things are very rocky in the U.S., but they’re worse elsewhere. That seems to be the reason behind the dollar’s dramatic rise against other currencies in the past few weeks.

One of the most dramatic changes has been in Chile. At the beginning of this year a dollar would have gotten you around 500 Chilean pesos. Today the official rate is 627. See the chart here from fxtop.com.

That 20 percent rise in value is not going to help you all that much with hotels priced in dollars anyway, but it does give you more bang for the buck when doing anything the locals do—like eat out in a restaurant. Or when you buy a bottle of Cabernet in a store.

Same story in Mexico, where their peso had dropped down around 10 to the dollar this summer and is now at 12.5. Again it doesn’t matter much for hotel bookings, but it affects your cost of a taxi ride, a driver for the day, a decadent seafood meal, or a domestic flight priced in pesos.

Latin America was a great value when the dollar was struggling hard against the euro and it’s an even better deal now. Head south and live it up instead of making hard decisions about your budget in Europe.

Michael Steinberger runs Latin Tour Dimensions, a company that is known for its custom tours in Central America and South America, trips that are “complex, in-depth, and expensive.”  I interviewed him to find out what kinds of travel trends he is seeing. We talked about the changing face of tourism, what destinations are hot, and how a travel agent is like a doctor making a diagnosis. A short version of the interview is here, with the rest of it continued after the jump.

What kinds of trends are you seeing in Latin America? What has changed?
On the destination side, Argentina has been crazy–it’s off the map. Whereas every second request used to be Costa Rica, now every second request is Argentina. Plus people are staying longer and doing more. It used to just be Iguazu Falls, Buenos Aires, Bariloche, and then over to Chile. Now people are doing long custom tours of just Argentina and going to Mendoza for wine tours. They’re going beyond Bariloche to Calafate. In Chile, travelers are branching out beyond the well-worn path.

We are also getting a lot more upscale family tour requests now, with soft adventure activities and requests for a different kind of hotel style, one with a real sense of place. It’s a bonding experience.

There has also been a clear shift in what people want to experience when they travel. Before, people went to cities in Europe to see buildings, to Africa to see animals, to Asia to see monuments. But then the baby boomers really got hooked on experiential vacations. They decided they wanted to go to Tikal, Machu Picchu, and remote jungles, to see ancient civilizations. That’s what put Latin America on the map because we have it all. We saw that early on and embraced it. People who travel to Central and South America are well-versed travelers who are looking for more.

Give me some examples of some unusual requests you’ve been able to fulfill.
We do all kinds of adventure activities, but the toughest one to get together was a wine and gourmet tour across Chile and Argentina. We got the request from four couples in New York that had various wine and restaurant connections in their jobs. They knew their stuff and wanted a true gourmet experience. So we called in chefs to take them to market and cook for them, got them into the best restaurants, and had them meet with top winemakers. The challenge was that there wasn’t a structure already set up for this by anyone else. We had to find the right small local suppliers in each place to make it seamless, with the same high level of service throughout.

We also had one family from London that was very involved in polo and horses, so we needed to line up estancias around Argentina that would satisfy them, going beyond the surface level offerings to put them together with real horse people. We welcome challenges like these though. We really enjoy doing them because it shows we’re better equipped than the paint-by-number tour groups offering very similar programs.

See the rest of the interview with Latin Tour Dimension’s Michael Steinberger.

I was quoted a few times in Travel Weekly last week in a long article about the impressive tourism numbers coming out of Argentina and Chile. I’ve been saying for quite a while that there is a good bit of “Europe substitution” going on—travelers deciding to head south instead of across the Atlantic. Now we have some hard numbers to back it up. The number of Americans visiting Europe this past July was down 15 percent from 2007. Meanwhile, the number of Americans going to Chile in the first half of ‘08 increased by 15.8 percent. Coincidence?

No, it just makes lots more sense from a value standpoint. When the Ritz-Carlton in Santiago costs in dollars what the Ritz-Carlton in Barcelona costs in euros, that’s a difference of 40 or 50 percent. Stroll around town for a meal and a bottle of wine in Santiago or Buenos Aires and the difference is even more dramatic, as in a tab that’s 1/4 to 1/3 a comparable meal in Europe, even at the best restaurant in town. There’s value even at the very top of the possible budget range, whether you are looking at hotels, adventure tour packages, or villa rentals.

LAN is stepping up flights as a result, says Travel Weekly. “The carrier now fields four nonstop flights per week from New York Kennedy to Santiago plus daily service from Kennedy via Lima, Peru; 10 weekly flights from Miami; and three weekly, nonstop flights from Los Angeles plus four via Lima. This month, the airline is set to launch service to Toronto.

Luxury Chile Travel page

Luxury Argentina Travel page

[Photo by Lorie Bennett, from our review of Explora Salto Chico in Patagonia.]

I’ve been catching up on getting through my stacks of magazines this week and found a great article in National Geographic Adventure on the aftermath of the volcano in Chile that erupted in early May of this year. In Fallout on the Fu, the article looks at what the impact could be in a region that depends on tourism to keep the development wolves at bay.

The Palena region of Patagonian Chile has long been a battleground between those who want to keep it in good shape and those who want to rape the land for industry and power generation. As Jimmy Langman discussed in our Pumalin Park feature story, much of the preservation was done by North Face founder Douglas Tompkins buying up lots of land and leaving it intact. (Much as Ted Turner has done in the western U.S.)

Many worry what the future holds if upscale tourists stay away, worried about a land covered by ash, with the wildlife reduced.

Fortunately, it’s not all gloom and doom. Some areas received a few inches of ash, but others barely got dusted. The Fu River, a favorite for rafters and kayakers, is still flowing fine. So if you had plans to head that way, by all means check out the situation with local operators, but don’t cancel based on tales of gloom and doom. The residents and the land could both use your support.

The author Isabel Allende was born in Chile and worked there as a journalist between 1964 and 1974, before she went on to write such highly regarded and successful books as The House of the Spirits and Ines of My Soul–which takes place in Chile. Here newest book is a memoir, The Sum of Our Days.

Geographic Expeditions runs an online literary travel publication called Reece and they recently ran an article where Allende discusses her homeland: My Chile.

She gets right to the point as to why this is a good country for travelers. “Good coffee and clean bathrooms and clean water everywhere. No scorpions or poisonous snakes or gorillas.” She notes that the food is not all that sophisticated, but that’s because “we have so many great raw materials. Everything is fresh and wonderful.”

In the conversational article, she describes some of her favorite places in the country, including spots in Patagonia. “The full moon between the two incredible mountain towers of the Cuernos del Paine, reflected on the lagoon, is an unforgettable sight. The air is crispy, like paper, so that you feel you can cut it with scissors.”

And here’s something you won’t hear from many Chileans: you get better wine for the money in California. “In Chile you can get excellent wine, but you have to pay more for the very good ones, and the other ones are not that good.” We can assume Ms. Allende will not become a corporate spokesperson for Concha y Toro anytime soon.