Dollarization is the replacement of a country’s domestic currency with that of a foreign currency. Dollarization has occurred in several countries including, but not limited to, Panama, El Salvador, and Ecuador. For countries with volatile currencies, dollarization offers them the ability to stabilize their economy. While dollarization has its pros, it is not without its cons, and for Ecuador, this is no exception. In my initial discussion, I believed that dollarization was a positive move for Ecuador; I still feel this way, and now that I have gained a bit more knowledge concerning the macro economy system, I understand how dollarization aided in Ecuador’s economy to stabilize. However, with all the positives associated with Ecuador’s adoption of the dollar, there are negative aspects as well, and there is no indication of how Ecuador will fair in the long run. In addition, the implications are not limited to the dollarizing country alone; there are pro et contra to the United States and the economies of countries surrounding Ecuador. Ecuador is considered one of the poorest and most vulnerable countries in Latin America, and approximately 15 …show more content…
Counterfeiting, a loss of identity, and the costs associated with changing everyday transactions to American currency. Counterfeiting is a major issue in Ecuador, and this problem was expected to grow exponentially with the implementation of the dollar because banking personnel have not been as well trained to spot the fake bills. Currency is often times considered to be a symbol of one’s country, and dollarization means the loss of one those symbols. Furthermore, it will take a great deal of time, energy and money to reprogram cash registers, computers, and software to convert Sucre prices to U.S. dollar prices. Business employees will also need to be reeducated and retrained in order to better handle the inflow of U.S.
Salvador has adopted the dollar, it still isn't enough to pay for simple things such as a pound of
"Stories - Peru Journal - Part 2: Diseases of the Poor — International Reporting Project.”
The decreasing current account, increasing capital account, depleting international reserves, declining real GDP growth and increasing dollar-denominated tesobonos all pointed towards the vulnerability of the Mexican economy. In view of the repeated political unrests, Mr. Woo and the others should have expected this crisis. But they based their decisions on surface information and market sentiments that had over-valued the market potential.
Goldberg, Rachel. "Inequality and Health Care in Peru." MedLife. MedLife, 27 Dec. 2012. Web. 15 Apr. 2014. .
The colon was the official currency of El Salvador from 1892 to 2001, when it adopted the U.S. Dollar. Based on the research carried out in 2010, El Salvador ranked 12th among the Latin American countries in the category of Human Development Index and fourth in Central America and is increasing rapidly when it comes to the industrial sector.
A buyer brings along with him snacks that he would like to purchase in a dollar store: chocolate chip cookies, a Pepsi, gummy bears, and a bag of chips. He waits in line, eager to consume this huge delight. It is his turn, and he hurriedly placed his treats on the counter, waiting anxiously to pay immediately. The cashier replies to him, “The price will be $5.99, sir.” The buyer takes out five one-dollar bills and four quarters. Not an instance did he ever use a penny in this case, which he thought was useless and meaningless. As you can see, the penny has become quite worthless and diminished in purpose. Many citizens would prefer to round up and pay rather than spend time and look in their
The penny should be eliminated! The penny is the us’s lowest denomination of currency. Currently the penny costs more money to make then the penny is worth. Recently the legislature passed a bill to cut the penny altogether. While the penny has been around for 200 years it has been proven useless in modern times for reasons like a charge card and . The many reasons for eliminating the penny include the penny costs more than the value of its metal, Basically no one uses penny's any more, And the penny costs us a lot of time that could be used valuable. The penny is useless.
You probably have pennies laying all over your house probably a lot more than you think. Have you ever realized how neglected the penny really is? How often do you take pennies with you when you're out shopping or spend the time to count out the pennies to them to the bank? The penny should be eliminated from the united states currency.
Gathered from the CIA world fact book I created this table to get a simple
Latin America is rather large and kind of difficult to pin point since it starts from Mexico’s border with the United States of America all the way to a small island called Tierra del Fuego, but I can tell you that it’s south of the United States. Latin America also includes all of the Caribbean islands where almost all the countries are suffering of hunger and bad leadership. Brazil and Argentina are two of Latin America’s strongest countries because they make up most of the common market where other nations come to trade, buy goods and buy cash crops. There is a lot of fertile land and plantations in Latin America that produce goods such as sugarcanes and tropical fruits. There are places like mountain ranges where people do live, but eventually have to leave because of the conditions so most of those people end up living in the cities and have to find work which is very hard and leads to poverty in the cities. The cities are one of the weirdest places in Latin America simply because of the people and way of life. In the city you can see Lexus parked right next to a donkey and see a millionaire right next to a woman walking barefoot carrying her child and a bucket on her head. These are everyday life occurrences that give you a clue on how things are in Latin America.
What is one of the biggest problems in Latin America today? Is it the slums that some people live in or the way poor people are treated? Both these ideas connect to Latin America’s largest problem today, the major income gap between the rich and the poor. When people think of Latin America in modern day some will think of the rich citizens who live prosperous lives, but many of them also think of the poor folk who live in slums such like the favelas of Rio. This might not seem like such a big issue to us, but for the people of Latin America this could not only affect their economy, but their politics as well.
...price and devaluation of the domestic currency to bring it back to A from A’ the country has to sell off its Foreign assets.
Chile is considered to be the most developed country in Latin America based on the World
The invention of money is perhaps one of the greatest achievements of human civilization. From the very beginning of society, people have used money to circumvent the difficulties of bartering and to foster trade and commerce. Since then, money has come a long way. No longer do we need to rely on silver coins, cocoa beans, or even anything of intrinsic value to conduct our business; today, we use paper currency, which is convenient and easy to carry around. But slowly, we are moving into the digital age of money, an age in which less of our money is actually tangible and more of it is just data on a computer server.