[Date Prev][Date Next][Thread Prev][Thread Next][Date Index][Thread Index]
#1953: Re: #1931: RE the Gourde's Depreciation, the killings of foreigners, .... Poincy replies to Blanchet
From: Jean Poincy <email@example.com>
Max Blanchet made correction:
" The Central Bank's intention is to use its reserves in dollars to buy
Gourdes. Instead I said that it intended to buy dollars."
Well taken; however, either way, the decision is an ill conceived one
and forgive me if I started blaming the Ayitian economists whom
understand correctly that would be a bad decision for the country.
Inflation will be worst than ever before. The idea underlying the buying
money is to increase the purchasing power of the people or the nation by
making more money available. I should note that I don't know if buying
more Gourdes means printing more money.
Whatever it might be, I just don't see how getting more Gourdes would
help Ayiti/Ayitians on the international market, since the currency is
not a recognizable one for international trade. Hence, I assume it would
be for local use only.
I have no argument against the fact that getting hard currencies is a
way to strengthen a weak currency. However, wherever it was applied
successfully, that was to make productive investments and not to import
more as I stated earlier. Any country that does the latter suffers
Whenever a nation feels that people's purchasing power has decreased,
the way to approach the problem is to juggle with price policies and not
by pumping more money on the market. Unless Ayitian authorities nurture
the fallacy that money is wealth rather than a means of ensuring "wealth
circulation" to provide utility.
For that matter, they can buy or print (whatever one may call it) as
much money as they want, they will never get the wealth sought for. The
reason being that wealth can never be bought but produced or built to
provide utility, something that Ayiti does not do at all.
If the logic says that money is the means to make wealth circulate for
the utility of all, and wealth is produced material things to be
exchanged to provide utility, it follows that an unproductive Ayiti does
not create wealth nor provide utility. Subsequently, money is no use for
Ayiti's local economy.
However, considering the great need in Ayiti for material things not
produced in the country, importation is a must to maintain collective
survival. Since, the country has to resort to importation to satisfy its
material needs, necessarily hard currencies (US $) are what to make
available more rather than Gourdes. Although, disastrous, that would
make more economic sense.
Ayiti has lived, lives and live