Das Thema dieser Englischstunde für Ökonomen ist die Dollarisierung.
Die Inflationsraten sind weltweit gestiegen, aber während einige Länder mit Inflationsraten von zu tun haben 5 oder 6 Prozent pro Jahr, andere Länder kämpfen mit Raten von 5 oder 6 percent per month, or even more. Managing those high levels is a big challenge for policymakers. One of the possible solutions that gets considered is to replace the domestic currency with the euro or more frequently, the US dollar. Dollarisierung.
So, here are some words you can use to engage in the conversation:
Legal Tender: Banknotes and coins recognized by law as a means to pay a debt or meet a financial obligation. So, zum Beispiel, the Uruguayan Peso is the legal tender of Uruguay. The Chilean Peso is the legal tender of Chile. Legal tender.
Currency Peg: a policy in which a national government sets a specific fixed exchange rate for its currency with a foreign currency or a basket of currencies. Currency peg.
Übrigens, in general terms, a peg is used to fasten things together. A clothes peg, zum Beispiel, is what you might use to hang your clothing online to dry. A peg. And in this case, a currency peg.
Alright, the next word is
Hard dollarization: This is official dollarization.
Soft dollarization: That is partial, unofficial dollarization. Sometimes it is referred to as a de facto dollarization, where the dollar exists as an alternative to a domestic currency.
Let’s deepen the lesson a little bit and look at a headline of an opinion piece that was published at the end of April 2022 in America’s Quarterly. See if you understand the English:
Dollarization Is No Silver Bullet for Latin America’s Inflation Woes
Lassen Sie uns diese Überschrift aufschlüsseln, um zu sehen, was sie bedeutet, and see which vocabulary might be useful for you to learn.
The first expression is ‘silver bullet’. A silver bullet is a simple, almost magical solution to a complicated problem. In Spanish, you know this expression as ‘una bala de plata’. Bala de Plata: Silver bullet. Same thing.
And ‘woes’? A woe is something that causes you trouble—a problem. Woe is a word that you will find written more than spoken. It is not very commonly used. Still, you should understand it when you see it.
Okay. That’s all the words. Here is a quick review of all the key vocabulary
That covers the new vocabulary. Remember, you can find lesson notes and a link to the article on the lessons page at EnglishforEconomist.com. Please, if this topic interests you, you could also watch lessons 27 and 35.
Okay. That’s it for now. I will be back next week with another English lesson for economists. Bis dann.
Image used courtesy of Manuel Dohmen - Own work, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=185802