Word: dollarization
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Dates: during 1980-1989
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...times popped up last week, when the Government reported that the U.S. trade deficit surged in November to $12.5 billion, up from $10.3 billion the previous month. The stalled progress in narrowing the trade gap brings into question a central assumption of U.S. trade strategy: that the weak dollar will continue to shrink the deficit by making U.S. exports cheaper overseas and imported goods more expensive for American shoppers. But U.S. imports just keep on rising. That partly reflects what some economists have begun to call "hysteresis" -- a fancy term for the notion that new habits, like old ones...
Even before the figures came out, a Japanese official warned the U.S. against weakening the dollar as a trade-gap remedy. Makoto Utsumi, a senior executive in the Finance Ministry, declared that a further fall of the dollar against the yen would not close the trade gap because Japanese firms would lay off workers and take other steps to remain competitive. A cheaper dollar, said Utsumi, would simply "make America for sale...
Stanford economist Ronald McKinnon, an expert on foreign trade and finance, concurred with that view. "A declining dollar is nothing more than a reflection of an easy-money policy," said he, adding that the excess of Government borrowing and spending increases U.S. demand for imported goods. At the same time, currencies that are strong in relation to the dollar have made American farms, factories and real estate tempting to foreign buyers, says McKinnon, "so we conduct something of a fire sale" to pay for imported merchandise...
...President Jose Sarney last week received a decidedly chilly reception. Designed to slash the country's 1,580% inflation rate and to attack the $66 billion national debt, the plan will freeze prices, abolish automatic wage hikes and devalue the Brazilian cruzado by 16.4% in relation to the dollar. The government will close six out of 27 ministries, and promises to fire 60,000 employees. Brazil is temporarily suspending any further debt-for- equity swaps with foreign banks and refuses to rule out a new moratorium on payments toward its $115 billion foreign debt...
While Barbara's humor is clever, Bush's can be prep-school puerile. Several weeks ago, at a private dinner at the Chinese embassy, the President-elect brought a novelty gag, a dollar bill attached to a long fishing line that appears to be free for the taking on the floor. When a waiter went for the bait, Bush quickly snatched it out of reach. Bush and his host, the Chinese Ambassador, found the gag great fun. Barbara, whose humor tends to be verbal, rolled her eyes and turned to the Ambassador: "You're going to have your work...