Le sujet de cette leçon d'anglais pour économistes est la dollarisation.
Les taux d'inflation ont augmenté partout dans le monde, mais alors que certains pays font face à des taux d'inflation de 5 ou 6 pour cent par an, d'autres pays sont aux prises avec des taux de 5 ou 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. Dollarisation.
Alors, 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. Alors, par exemple, 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.
D'ailleurs, in general terms, a peg is used to fasten things together. A clothes peg, par exemple, 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
Let’s break this headline down to see what it means, 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.
D'accord. That’s all the words. Here is a quick review of all the key vocabulary
Legal tender
Currency peg
Hard dollarization
Soft dollarization
Silver bullet
Woe
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.
D'accord. That’s it for now. I will be back next week with another English lesson for economists. À plus tard.
Image used courtesy of Manuel Dohmen - Own work, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=185802
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