- Business Insider spoke with Dharsh ini David, economist, broadcaster, and author of “The Almighty Dollar.”
- David talked about why the Euro hasn’t challenged the Dollar as an international currency, despite being used by more people than the American currency.
- She also talked about how the Yuan could become the world’s dominant currency.
Read the full transcript below:
In many ways, it might seem like the obvious thing the Euro is used by more people than there are Americans using Dollar.
So surely that should mean that the Euro becomes a dominant currency, right? After all, both trading blocks are made up of very big spenders indeed. So surely the Euro should be in ascendancy.
It hasn’t quite happened just as yet. What we have seen is the Euro when it was launched, was launched as a currency that represented a very disparate range of countries with very different fortunes.
That meant because you had to have one interest rate to represent all those countries what you saw was their economies doing wildly different things. You had an interest rate that was set to suit the economies largely of the largest countries like Germany and France.
Whereas you needed relatively low interest rates because you had problems of German unemployment that meant there was a property boom in Dublin instead because the Irish economy needed much higher interest rates.
So what you…