Volume 152 • Issue 1
The Newspaper of Amherst College Since 1868
Friday, December 2, 2022
Number of Articles: 1
First Article: November 17, 2004
Latest Article: November 17, 2004
By Jonathan Borowsky '07
November 17, 2004
Suppose that one of the Asian banks starts to dump its reserves of American
currency. This extra supply of U.S. dollars would lower the “price” of the
dollar-the exchange rate between the U.S. dollar and other world currencies.
Other major players may be tempted to sell their own dollars before they lose
more value, creating a speculative cycle and a rapidly dropping exchange rate.
The price of imports would rise, increasing the cost of living and of doing
business. This increase could create a