Lasso, a career banker, promised to offset the economic damage done under Moreno by doing a better job in attracting foreign investment and creating jobs in a more open economy, as well as heavily investing in agriculture.
Whether he can do this remains to be seen. In 1999, he had a short stint as ‘Super Minister’ of the Economy under the government of Jorge Jamil Mahuad. That time was marked by significant economic turmoil and forced Ecuador to adopt the US dollar as its national currency, gaining stability in exchange for weakening the central bank’s ability to conduct monetary policy....
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With Lasso’s victory, a new stage of deepening neoliberalism will now begin in Ecuador, which has already had its foretaste in the project to privatize the Central Bank of Ecuador, which could be carried out before Moreno leaves the presidential palace of Carondelet on May 24. The continental map will continue with the same correlation between progressive forces and right-wing governments, with the consequent limitations for the reconstruction of Latin American integration.
Internationalist 360º
A Stage of Deepening Neoliberalism Begins in EcuadorMarco Teruggi
A truly private central bank could not create fiat and thus could not act as a lender/asset buyer of last resort. Nor could it credibly provide or backstop deposit guarantees.
ReplyDeleteThe Central Bank of Ecuador can't create fiat anyway, since Ecuador uses the USD, which it has to obtain either from trade or borrowing. It's already captured.
ReplyDeletePitiful.
ReplyDeleteEcuador could have instead increased demand for its own fiat by allowing everyone to use it in account form (but citizens for free to a reasonable account limit) and by abolishing all other privileges for private banks and private bank deposits.
I've got hope for China though in that regard as a means to bypass the US dollar and even its own private banks.
The trouble with the US is it imagines it has a free market when it actually has a bankacracy. Thus it can't see the need for reform. China can take advantage of that blindness...
USD zombies...
ReplyDeleteI've got hope for China though in that regard as a means to bypass the US dollar and even its own private banks.
ReplyDeleteWhile the digital yuan is still only in trail, it looks like it will clear directly by the People's Bank of China. The PBOC is the central bank. So holding (saving) digital yuan is tantamount to have a deposit at the cb. It's a "spot deposit" rather than an ordinary demand (checking) deposit. Everything will take place immediately for the use via a digital device. No brainer.