Seth Ackerman
> -----Original Message-----
> From: Dennis R Redmond [SMTP:dredmond at OREGON.UOREGON.EDU]
> Sent: Friday, August 21, 1998 6:59 PM
> To: lbo-talk at lists.panix.com
> Subject: Re: Euros
>
> On Fri, 21 Aug 1998, Mark Jones wrote:
>
> > Rakesh, leaving aside the question of why oil is priced in dollars,
> how
> > can any currency become a reserve currency unless the issuing state
> runs
> > up trade deficits? How else can large amounts of it end up in other
> people's
> > hands? Since EU states are oriented to export for dollars, how can
> the
> > Euro hope to compete with the dollar? By merely issuing money?
>
> By issuing credits to semiperipheries, which can be used to purchase
> goods
> from the metropole. You don't get rich by distributing currency to
> other
> people, you get rich by charging them for the privilege of holding
> currency, a.k.a. bonds, loans, or other forms of debt. Those EU states
> are
> no longer dependent on US dollars, incidentally; 60% of their
> trade is done internally with other EU countries. The central bankers
> and industrial-financial constellations behind the euro are cretinous
> and
> vile sadomonetarists, but they're not stupid.
>
> -- Dennis