On other countries using U.S. currency
destroyedkingdom asks: I don’t get it. Why is a foreign country using our currency? Isn’t that sort of a bad thing for our economy because people are spending our money that isn’t going into our economy?…..Maybe I’m just not informed enough about this but that just seems weird.
» SFB says: This is actually a common thing, and a good thing because it underlines the stability and maturity of our own currency. They wouldn’t do it if the U.S. dollar was weak, y’know. As the result of the gold standard becoming less common throughout the world, some smaller countries with less economic stability have used the currency as a way to build up their own economic strength. Zimbabwe is the perfect candidate because their local currency was so weak that the stability of the U.S. dollar could only strengthen them. The U.S. already has a global currency used throughout the world; this just underlines it. And it’s worth pointing out that some countries, such as Panama, Ecuador and the Federated States of Micronesia, have done this for decades — in Panama’s case, over 100 years. The International Monetary Fund did a report on this phenomenon, if you’re curious, complete with pros and cons. — Ernie @ SFB
(Source: The New York Times, via destroyedkingdom-deactivated201)