Basil,
New England: Maine, New Hampshire, Vermont, Massachusetts, Rhode Island and
Connecticut, sends 12 out of 50 Senators and 6% of the Representaives to
Washington. New England also enjoys free movement of population, and
therefore
labor, within the 50 states, not to mention uniform federal laws and
regulations on minimum wage and tax rates
Dollarization will not help SA, it will only fix interest rate to peg US rates
which is set by the Fed whose deliberation does not take into account the
needs
of SA. The boom and bust will continue at Greenspan's pleasure. That is what
happens to Hong Kong since 1983.
Dollarization removes the need for a SACB.
Basil Moore wrote:
> William
> Does everyone in the Dollarisation debate recognize that once a country
> dollarises, it ceases to have any balance of payments problems with all
> countries who are also on the dollar? The current account deficit ceases to
> matter, and is no longer a constraint. eg like New England with the rest of
> the country.
>
> This is hugely important for developing countries. In SA, where I am
> currently residing, whenever the economy grows rapidly, its MPM capital
> goods is about 1, so capital imports flood in, the current account goes
> into deficit, and the CB must dramatically raise interest rates to protect
> the exchange rate, so the boom and growth is flattened.
>
> Basil Moore
>
> At 10:16 PM 4/19/01 -0400, you wrote:
> >Astute students of imperialism understand that "voluntarism" on the part
> >of the ruling class
> >of the victim nation does not disguise imperialism. In fact, imperialism
> >works always hand
> >in glove with an indigenous comprador class. Having been born and raised
> >in Hong Kong, I am
> >an expert on this phenomenom.
> >
> >Henry C.K. Liu
> >
> >
> >
> >"William F. Hummel" wrote:
> >
> > > Henry Liu wrote:
> > >
> > > >Furthermore, the dollarization of the Americas would logically be
> > accompanied by the
> > > >surrender of the Federal Reserve of its authority and powers to a new
> > Central Bank of
> > > >the Americas, like the ECB. Is the Us prepared to do that? Not
> > likely. Dollarization
> > > >without an Central banks of constituents nations is pure monetary
> > imperialism. But then
> > > >Alan may argue that imperialism is good. It certainly worked for the
> > British Empire
> > > >with the role of the pound sterling. The curious thing is the some
> > very influential
> > > >Americans, including Greenspan and Summers, are against the idea of
> > dollarization, as
> > > >they do against the tolerance of euro-dollars. Summers is famous for
> > his admonition of
> > > >Japan: sound macro-economic cannot be substituted by an exchange rate
> > policy.
> > > >Dollarization is of course the ultimate exchange rate policy.
> > > >
> > > This confuses dollarization with a treaty for a common currency
> > > which would involve a central bank for the treaty members.
> > > Dollarization (meaning adopting the US dollar as the official
> > > currency) is a voluntary act of a sovereign nation. It may or
> > > may not be beneficial to that nation, but the assertion that it
> > > is pure monetary imperialism is absurd. The US monetary
> > > authorities have not encouraged any other nation to dollarize.
> > > They are well aware of the negative implications of
> > > dollarization, both for the dollarizing nation and for the US.
> > >
> > > William F Hummel