The new Amero currency is just a hoax

The economic downturn caused great speculations about failure of the US dollar and some conspiracy theories about introduction of a new North American currency named Amero.

Everybody failed, to start with. There is not a single winner from the current events.

As for the US dollar, to my mind, it not only will survive all these insinuations, but on the contrary there are sufficient prerequisites that it will strengthen its leading world positions.

First of all, this is still the main world currency in which all major commodities are valued, and I see no other competitor that can substitute the buck globally. The depression will eventually come to an end (rather sooner than later), and the demand for raw materials and other main commodities will rapidly increase - the Earth population and its necessities are still growing in geometrical progression - that is why the US dollar does not have any reason to fall from the market.

Secondly, the Euro currency, so far the only currency able to partially substitute the dollar, is in deep troubles itself and will put at serious test the whole unified decision making system and the regulatory capacity of the European Union. The European economy is in bad shape, drastically reducing the investment attractiveness of its traditional industries - as a consequence, we may expect with a very high degree of probability that Euro will fall towards the US dollar very soon (which will become beneficial for European exporters).

Thirdly, the United States economy, though criticized now, is a unique phenomena, both in sense of its ability to rapidly react to and overcome emerging problems, as well as in its huge unlimited capacity of growth, which provides a strong drive for the whole world.

While the traditional European economies are based on “asset-backed” approach for financing new investments, the American model has been the most dynamic economy because it also vastly encourages investments into new ideas, into projected cash-flows. So, even if only one in ten new ventures would succeed, it drags along other productions and other new ventures. Hence, dynamism and high competitiveness, development of new technologies and innovations, which all are the key success factors for and a strong motivation in a modern economy.

In Europe, if you failed once, you are basically in a black list forever. In US one can try his luck again and again. Europe is 3000 meters hurdles: exhausting and with a low motivation, whereas US is 4x100 meters relay: fast, competitive, with several chances for coming first and win the prize.

Pumping too much cash into the economy and making it indebted for three generations ahead?! It seems not to be an issue of concern in a monetarist economy: the debts are virtual, they are somewhere on the papers in the future, whereas the current real economy today should have as much cash as possible to keep it driving, with only one important condition - keep inflation under control with all available means. And it is working, and will work well until it works in one leading world center. As soon as someone else would like to repeat the same, then it will definitely be a global mess. If according to marxist-leninist theory, money is the blood of the economic vessels, then it should be a blood of one group - adding another type of blood would kill the body of the international economy.

No one changes horses during a river crossing. Renouncing the slightly shaken, but still strong dollar, and changing it with an unknown currency linked to three different states (USA, Canada and Mexico) not fully prepared for that, would potentially create a dangerous vacuum in the international economy. That is why all these rumors about Amero are probably nothing more than intentionally destabilizing speculations.