Forum Archive Index - July 2001

["Graham Astley" <glas@ihug.co.nz>]

 

  I think the problem for NZ is that it has a currency at all. We are just too small and feeble to justify our present position. The same can be said for Australia with whom we have close association. The answer I think is for Australia to establish a peg to the US dollar and for us to do the same. An American economist out here recently was extolling the virtues of the Argentine and Hong Kong positions. I don't see how those two countries can be viewed in the same context. Argentina has adopted the US dollar and has it's peso fixed at one to one. This was clearly a mistake because although the US can live with the appreciation of it's dollar against other countries currencies, Argentina cannot. Hong Kong is pegged at a much lower level and can probably weather the storm.

 

Graham Astley