Argument: Dollarization places constraints on US monetary policy
- C. Fred Bergsten, Peterson Institute. "Dollarization in Emerging-Market Economies and Its Policy Implications for the United". Testimony before the Joint Hearing of the Subcommittee on Economic Policy and the Subcommittee on International Trade and Finance. 1999 - "The situation would of course become different if a large part of the world, or even a large part of the neighborhood (say, Canada and Mexico), made a policy decision to dollarize. Economic developments in those areas would then have a considerably greater impact on overall monetary conditions in the United States itself, requiring greater consideration thereof in the conduct of US monetary policy. At some point, we would have to contemplate accepting those countries as new Federal Reserve districts and giving them seats on the Fed's Open Market Committee, and even devising some form of fiscal federalism to provide an alternative adjustment device to compensate for the abolition of the exchange rate instrument between them and us."