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Published: Sunday, 8/19/2001

Bringing in the euro

Europeans are jittery over what will happen on Jan. 1, when 12 nations switch from their own currencies to the euro, now worth about 90 cents U.S. The concerns are reminiscent of the Y2K crisis that never really materialized.

What many people do not realize is that U.S. currency was trundled along the roads of this country to make sure that in the event of the worst-case computer breakdown, the banks would be liquid. That money had to be put someplace, hence the golden fourth quarter of 1999 on the stock market. Things haven't been the same since.

Twelve nations have adopted the common currency. For now, Britain, Sweden, and Denmark have declined to join. It is truly an amazing development, considering the history of Europe throughout much of the 20th century. Like the biblical example of the lion and the lamb, the German deutschmark and the French franc will lie down together.

There will be problems. Finland, a large, sparsely populated country, has only 150 special trucks to haul money around to its far-flung system of banks and ATMs. The switchover will be complicated. Old money has to be picked up, even as the new currency and coins are distributed. The 500-euro note, worth about $425, is of higher denomination than any of the currencies it replaces, and it is feared that counterfeiters will find this a golden opportunity. And every country has its idiosyncrasies about money: how much people carry or ordinarily take out at the bank, for example. It could even have an impact on church collection plates.

But more than anything else, the common currency will introduce a new sense of European-ness that in some respects is still lacking. Retiring the franc and the mark and the Dutch guilder is an important psychological step toward greater European union. Some financial observers believe it will cause the euro to rise in value. The change will cause some adjustments, maybe a lot of them.

The United States, on the other hand, is younger than most of the European countries, but clings tenaciously to its English system of measure and scorns dollar coins, preferring the paper dollar instead. Americans often think they live in a land of innovation, but we probably would have a harder time adjusting to a new international currency than our European cousins.

Chalk it up perhaps to our sense of continentalism. World superpower the United States may be, but it still thinks in terms of a land protected on the east and west, at least, by oceans, though they're no longer the barriers they once seemed to be.



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