THE UNITED STATES DOLLAR AND GLOBAL MONETARY POLICY

Early in 2002, several G-7 economies ? notably Germany, Japan, and the United States ? are officially in recession. Further, many of the world's second level, or peripheral, economies are in desperate straits. Many of the peripheral economies ? Singapore and Taiwan are examples ? are suffering because of slack demand in the major industrial economies for imported goods from the peripheral economies. Simultaneously, other peripheral economies face total monetary and fiscal collapse ? Argentina and Indonesia are examples.

With the global economic background described above as the perspective, the focus of this essay is the relationship between the United States dollar and global monetary policy, and, in turn, the impact of this relationship on global economic outcomes. The objective of this focus is to consider what changes are necessary to restore economic stability and growth on a global basis.

Within the context of this focus and the linked objective, three points are crucial. These points (discussed following their identification) are as follows:

Not all of the problems afflicting the global economies and the national economies that comprise the global economy are monetary in character

Monetary policy does not in and of itself create demand in the economy ? global or national

The current global monetary system does not have a reliable anchor ? the United States dollar is the benchmark for assessing the exchange

. . .
n either expectations or promises. The structure of future privatization programs must tie the private benefits of buyers to public benefits for the economy, with controls that keep the wealth within the country and exact penalties for failure. A similar massive transfer of wealth occurred in the United States in the dot.com IPO boom. Relatively low-level investment (venture capital), unrealistic promises (dot.com executives and brokerage houses), and unbelievable gullibility (institutional and individual investors) transferred massive wealth from the many to the few. The few, unfortunately, were primarily con artists with little intention of investing their gains in economically productive activities. The United States economy also suffers from an irrational belief in the integrity of a wholly unregulated market. This belief made possible the Enron debacle. The Enron debacle, in turn and together with its smaller cousins, are leading to a destruction of the Protestant ethic in the United States that links directly effort and benefit. The destruction of this link eventually will destroy the confidence of the American people in the United States economy. The United States, to restore long-term economic stability and grow
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Some common words found in the essay are:
France Germany, Argentina Indonesia, Currently United, United Regardless, Retrieved Internet, Singapore Taiwan, Reserve System, Lynch Brick, Japan United, REFERENCES Baker, monetary policy, global monetary, united dollar, monetary system, global monetary system, peripheral economies, york times, global economic, economic stability growth, global economy, 2002 january, retrieved internet, value global currencies, current global monetary, united dollar benchmark,
Approximate Word count = 1322
Approximate Pages = 5 (250 words per page)

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