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Senator Fauzi Hamdan Amad, a member PAN, President Vicente Fox's party, and Chairman of the Senate
Committee for Treasury, has this to say:
From “El Financiero”, Jan
16, 2001, Mexico City, Mexico.
Monetary Reform
Fauzi Hamdan Amad, Chairman of the
Senate Committe for Treasury, Mexico.
It is not
possible to conceive a fiscal reform in the State, without
including monetary reform. Money is one of the
most important instruments of economic policy. Our money is
supported by the Dollar; it only
has value as a result of the Dollar
reserves held by the Bank of Mexico.
A decrease, or what is worse,
a deficit in our balance of payments, produces a collapse in our economy.
We are mired in a vicious circle: we depend inexorably
on external savings without any alternative, specifically on the Dollar,
which turns out to be master of the value of the Peso.
As Hugo Salinas
Price has stated correctly: “...the present Peso is a dead-end alley...”
In order to
maintain the value of our money and hold reasonable Dollar reserves, we have
inordinately emphazised foreign commerce, mainly
with the United States.
It is paradoxical that the country with whom we have the greatest amount of
trade (70% approximately) is also the country that determines the value of
our money.
Without Dollar
reserves, our monetary and financial system collapses. The great crises we
have suffered in the last twenty five years, have originated, in the final analyisis, in dangerous decreases of our Dollar reserves.
The value of our goods and services (Gross National Product) which should be
the support of the value of our money with its own intrinsic value, has been
transferred to American goods and services, and thus produced an economic and
financial dependence and
subordination which cannot be sustained.
The monetary
system is so pernicious that only a radical change can save it. We are
finally dollarized and our money, in and by itself,
lacks intrinsic value and confidence.
The need to hold
Dollar reserves has forced our authorities to admit, without any restriction,
the entry of speculative Dollars, as well as the participation of foreign
capital in those activities, which due consideration indicates should be
reserved to Mexican nationals, and to obey the guidelines imposed in matters
economic and financial by the U.S.A., through the International Monetary
Fund, among other institutions; all these, among other situations and
conditions which are public knowledge.
Many authorised and recognized individuals have spoken out to
demand and promote the adoption of a new currency: silver. Hugo Salinas
Price, Luis Pazos, Arturo Damm,
Steve H Hanke
(Translator’s note: Mr. Hanke should not be
listed in this group, as not supporting its ideas) Octavio
Fitch, Francisco Helguera, among many others, ask
for a new currency with the backing of the real value of silver.
Senator Diego Fernández de Cevallos,
in an interview grated to T.V. Azteca in March,
1999, mentioned among other important things, the wisdom of considering the
introduction of silver for Mexico
as legal tender currency, an intelligent and brave commentary.
At one time, our
currency was of universal use, during a period of almost two hundred years,
from the 18th to the second decade of the 20th
centuries, a time during which the Mexican Peso was legal tender in countries
of Africa, the Middle East and Asia. In the
second half of the 19th century, the Mexican Peso attained its
highest value.
The Peso began
to lose its value at the beginning of the 20th century and started
a series of devaluations which originated basically in the fall of the value
of silver, due to its being displaced by the world gold standard. As we know,
the process of abandoning the gold standard began with the World War in 1914,
proceeded with Britain’s going off gold in 1931, and concluded with the
decision by President Nixon in 1971, in which he declared unilaterally the
non-redemption of Dollars for gold; and as a result since then, for thirty
years now, we have a real monetary and financial disorder in the whole world.
We must analyze
a monetary reform very carefully, in a wide forum, which will include all
individuals in this country who are qualified to give an opinion on this
theme, so that we may arrive at conclusions which may allow us to define,
once and for all, the sense and thrust of a possible monetary reform.
By :
Hugo Salinas Price
President, Mexican Civic
Association Pro Silver
www.plata.com.mx/plata/
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