Important note. Peace in the grave of Fernando Villavicencio. Grief for the country they want to intimidate and subjugate. But we Ecuadorians continue to oppose them.

…Let’s remember the situation until 1999. Sucre was the currency of everyday life, but the dollar was increasingly used for savings or housing, needs that required more trust… Three observations. ANDpeople with high incomes used the dollar more and were much more protected from storms: a huge injustice. Twoit was clear what were dollars and what were sucres. Threedollarization is based on a basic principle: we only use the (real) dollar because it brings trust.

Patacon in our future

Let’s move on. The money (before sucres, today dollars) is in banknotes or electronic bank accounts (that’s why we move it via computer). The so-called “electronic money” has also appeared (although I emphasize, your bank account too), for example, the “electronic mobile phone chauchera” that allows you to pay directly to the mobile phone of the storekeeper in the store. But the mechanism is always clear: you have to put (real) dollars somewhere (in an account or trash) to be able to use them electronically. And those dollars (really) came, in a way, from real activities such as exports, investments, remittances, etc.

dollar

Dollarization in Argentina?

Correísmo proposes the introduction of the use of electronic ecuadors, which, in order not to be confused, we give the real name: the new sucres. As? The Central Bank of Ecuador (BCE) would issue this new currency: for example, it would deposit them in a government account (since they are electronic, not banknotes, it is easy to continue to deceive that they are dollars) and transfer them as wages to the public account employee. Or he would force the exporters to give him real dollars, and he would give them new sucres of lesser value. Or in a thousand identical ways. Some will think: what’s wrong, is it the same as the electronic money described above? It would be true if the government handed over real dollars to the ECB and only asked it to send them electronically (like you with your electronic junk). But it is not like that: the government would not give anything to the ECB, it would simply create them without any “back”, it would be money of lesser value that did not come from any real process. What would the ECB do? Create a new (electronic) currency. Would it be dollars? Obviously not. What would they be? New sucres, we would go back 25 years, masked under the motto Ecuadores. The end of dollarization because there would no longer be only dollars.

Effects? Oneinflation and devaluation: bread would cost 1 in dollars, and much more in Ecuador (the two currencies are not “worth” the same), Ecuador would be devalued, and even more so if… Twogreat doubts: it would not be clear which dollars are real and which are not. Threewith bad dollars, payments abroad could not be made (no one would receive them) and the Government would decide how to limit the outflow of dollars: very high ISD, import control, capital movement ban. fourno real problem would be corrected, only a mirage. FiveWould you trust that currency? Wouldn’t you go withdraw your dollars from the banks before perhaps converting them into new sucres? And if you do… Sixhuge impact on the poorest… Very seriously. (OR)