William, as a keen observer of world finances, bonds, etc as well as Inet stocks, I was wondering what you think of Argentine's apparently very serious consideration of a plan to replace their currency with the US Dollar.
It seems to me that this is sort of like going on the Gold standard, except the gold is the dollar. A lengthy article in Sunday's Mercury News claims there is little downside for the US. As investors, the added stability in foreign currencies is positive for us. Also, internatonal trade would simplify, too, especially if the trend catches on - supposedly Brazil and even Russia might consider such a plan. (Actually, I can't see Russia ceding soveriengty like this.) The article claims informal talks are being held with the FED to get their opinion. The artilcle says that de facto, large purchases in many of these countries are already carried out almost exclusievly in dollars, now.
This also explains, perhaps, why the fast growing US money supply over the past few years has not led to inflation - the dollars are leaving the country and not returning.
I'm not selling anything! I just think the whole thing is fascinating, potenially good for us, and wondered if you have been following this issue.
Best regards,
Tom |
