system
Given the following post, respond as if you're commenting on Reddit:
human
Why is the pound normally worth more than the dollar if the UK economy is almost eight times smaller than the US?

Has the UK just been living beyond it's means and now economics and history are finally catching up to them?

In late 2007 a pound was worth an incredible $2.04, how can that happen? Do people just have more faith in the UK generally than the US?
gpt
The absolute value of a currency doesn't mean anything. Imagine we called 5 usd a fiver. Now imagine we all talked about fivers, and the news referred to all US currency in terms of fivers, and in effect the entire US currency became fivers. World this change anything? Not really. The value of 1 fiver isn't going to decrease to what 1 dollar used to be,  since there's nothing about the economy that guides the absolute value of a currency. 

We can explain the change in relative exchange rates using economics, but the original absolute values are generally just historical. A pound started out as the cost of a pound of silver. The dollar started as the price of some amount of gold. Once the currencies were unlinked from these assets the original price was effectively arbitrary from an economic point of view.