Mr. Chairman, I would like to thank all of our witnesses for testifying today.
As more and more countries in Latin America, move toward using the dollar as their currency, both officially and unofficially, we need to study and explore the possible ramifications of these actions. Two-thirds of US dollars already circulate outside of our nation. If more and more nations such as Argentina, Ecuador, Mexico and El Salvador either peg their currency to the dollar or completely "dollarize" their currency, what will the effects on our economy and the global economy?
Will using dollars as their official currency handcuff foreign nations when they are experiencing financial crises? Will events in foreign lands, such as the economic problems in Argentina this week, significantly affect our monetary policy if they adopt the dollar as their official currency? Will decisions made in our monetary policy be based only on what is in the best interest of the United States? Is this trend something we should encourage, discourage or just stay out of These are some of the questions I believe we need to look at today.
I also believe we must look at the European Union (EU) and what they are doing with the Euro. Are they promoting the Euro as an alternative to the dollar for countries considering dollarization? Are they using the Euro to try and grab a greater share of the expanding Latin America markets and cut into US exports in our Hemisphere? Finally, If the EU is considering some of these approaches, how should we respond?
Mr. Chairman, I commend you on holding this hearing and I look forward to hearing from all of our witnesses.
Thank you Mr. Chairman.