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Bolpress, Bolivia

Financial Tsunami”
from the United States

By Fortunato Esquivel

Translated By Alan Bailey

22 November 2012

Edited by Ketu­rah Hetrick

Bolivia - Bolpress - Original Article (Spanish)

On September 13, the administration of Barack Obama made a decision that was barely reported and even less explained by the experts that would know. This decision will have spectacular implications in the economies of emerging countries, since that is where the American strategy is directed.

The United States Federal Reserve, the equivalent to our central banks, announced that it will pump $40 billion into its economy with the supposed goal of reviving its struggling economy. Those millions will prompt the revaluation of Latin American currencies and the devaluation of the greenback. With cheaper dollars, everyone will want to import American products.

Countries like Bolivia hoard international reserves of greenbacks, which in our case is almost $15 billion. It is the fruit of the labor and sweat of more than 10 million Bolivians. The United States does not have "international reserves" because the Federal Reserve is the property of private banks that manage the printing process.

In this way, when the United States is lacking cash, it simply prints more of its bills and buys our natural resources with those inorganic little pieces of paper that are now flooding our banks. Hence, the decision of Obama's administration is important; it will flood our countries with $40 billion each month.

Brazilian President Dilma Rousseff was the first to respond, promoting strategies of resistance against the effects of the launch of such a quantity of greenbacks from the Empire [The United States]. President Rouseff just indicated that she will make all necessary decisions to avoid the revaluation of the real [Brazilian currency].

The avalanche of dollars into the economy increases the flow of capital toward these so-called emerging countries and has already been called a "financial tsunami" by the Brazilian president herself. This situation has not been discussed in our country within the government — even less so among the so-called "economic analysts" that are quick to criticize the policies of the government, but who shut their mouths in these cases.

Our leaders and economists inflate their chests when it's time to state that Bolivians are stronger and stronger, that the national currency deposits are increasing and that the dollar is losing value. The dollars sent by the Federal Reserve thicken the flow of capital towards Bolivia, revaluing our national currency, but it has to have a limit. Or does it?

Are we wrong in our assessments? In any case, those who manage the finances of the country are obligated to explain the impact that the financial tsunami, which Obama is promoting as part of his strategy to save his nation from the crisis that afflicts it, will have on Bolivia.

Explanations are urgently needed because otherwise we might be surprised. Let's hear the explanations, and quickly!



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