by Daniel Nardini
The U.S. dollar is the official currency of four countries in the Americas. These four countries are the British Virgin Islands, Panama, Ecuador, and El Salvador. The people of these countries are as familiar (or probably more so) of the famous men on the U.S. currency as they are known to Americans. Although they have their own coinage, their governments adopted the U.S. dollar because it is one of the most stable currencies in the world, and one of the most popular. Unlike all countries in the European Union that have to use the Euro, those countries that have the U.S. dollar as their official currency are under no obligation to follow U.S. monetary guidelines (as long as they do not produce their own dollars). The governments of these countries, as well as their peoples, realize that having a stable currency is necessary to having not only a stable economy but a stable society. The current president of Ecuador, Rafael Correa, is a socialist and is critical of just about everything the United States does, but he is not an idiot. He knows that the U.S. dollar helps to keep his country stable.
This is very different from the current policies of socialist president of Venezuela Nicolas Maduro. Whether one wishes to describe his policies as “socialist,” or “crazy,” they are not doing his country much good. The every growing controls over the country’s currency, the bolivar, has caused international banks and companies to abandon Venezuela as fast as possible. The fact that the bolivar currency is too controlled by the government leads to it becoming a devalued currency. Worse, it means that the country cannot import what it needs, and thus causes food and consumer goods shortages. To compound the distress, what goods are on the shelves are now being seized and rationed by the government. This only adds to the country’s woes since the bolivar, unable to be freely exchanged, has been losing a LOT of its value. What are many Venezuelans using in its place? The U.S. dollar! Maybe the U.S. dollar is not the best currency in the world, but it is one of the most stable and certainly way better than the Venezuelan bolivar.
For those Venezuelans who can get the U.S. dollar, it means a hedge against hyper-inflation, it means they can buy things on the black market not available elsewhere, and it means that if all else fails they can bail out of the country and prepare to go to the United States or wherever they can find refuge. Those Venezuelans who have U.S. dollars have buying power, and that can mean the difference between life and death. I do not see the current Venezuelan president switching over to the U.S. dollar to help save his country. Pity, he would be doing the people of Venezuela a big favor.
LOVE Them Dollars!
by Daniel Nardini
The U.S. dollar is the official currency of four countries in the Americas. These four countries are the British Virgin Islands, Panama, Ecuador, and El Salvador. The people of these countries are as familiar (or probably more so) of the famous men on the U.S. currency as they are known to Americans. Although they have their own coinage, their governments adopted the U.S. dollar because it is one of the most stable currencies in the world, and one of the most popular. Unlike all countries in the European Union that have to use the Euro, those countries that have the U.S. dollar as their official currency are under no obligation to follow U.S. monetary guidelines (as long as they do not produce their own dollars). The governments of these countries, as well as their peoples, realize that having a stable currency is necessary to having not only a stable economy but a stable society. The current president of Ecuador, Rafael Correa, is a socialist and is critical of just about everything the United States does, but he is not an idiot. He knows that the U.S. dollar helps to keep his country stable.
This is very different from the current policies of socialist president of Venezuela Nicolas Maduro. Whether one wishes to describe his policies as “socialist,” or “crazy,” they are not doing his country much good. The every growing controls over the country’s currency, the bolivar, has caused international banks and companies to abandon Venezuela as fast as possible. The fact that the bolivar currency is too controlled by the government leads to it becoming a devalued currency. Worse, it means that the country cannot import what it needs, and thus causes food and consumer goods shortages. To compound the distress, what goods are on the shelves are now being seized and rationed by the government. This only adds to the country’s woes since the bolivar, unable to be freely exchanged, has been losing a LOT of its value. What are many Venezuelans using in its place? The U.S. dollar! Maybe the U.S. dollar is not the best currency in the world, but it is one of the most stable and certainly way better than the Venezuelan bolivar.
For those Venezuelans who can get the U.S. dollar, it means a hedge against hyper-inflation, it means they can buy things on the black market not available elsewhere, and it means that if all else fails they can bail out of the country and prepare to go to the United States or wherever they can find refuge. Those Venezuelans who have U.S. dollars have buying power, and that can mean the difference between life and death. I do not see the current Venezuelan president switching over to the U.S. dollar to help save his country. Pity, he would be doing the people of Venezuela a big favor.