Currency

LONDON -- For the British, there is no escaping the euro, the new single European currency that fuels the neighborhood's new economic colossus.As euro trading unfolds today, Britain prepares for life next to Euroland, the 11-nation block of euro founders led by Germany and France. Britain is the most prominent of the European Union's four euro outsiders and is poised to protect its financial turf.Throughout the holiday weekend, the square-mile City of London financial district buzzed with activity, as banks and international investment firms set up "war rooms" and "command centers" to prepare for the euro.

PARIS -- Europe's new currency, the euro, was introduced in January not only as a culminating step in European union, but also with the conviction that it would provide a new and powerful rival for the dollar.Now the euro -- launched at a value nearly 20 percent higher than the dollar -- has fallen to near-dollar parity. It traded yesterday at $1.03 to the dollar, down 11.3 percent for the year. Markets and analysts rumbled with forebodings that the European currency would fall below the $1 barrier, a seeming humiliation for the European Union.

LONDON -- Europe's half-century quest for unity received a huge boost yesterday as the new single currency, the euro, entered the market fray and opened a potential challenge to the U.S. dollar for world financial dominance.From Sydney, Australia, to Frankfurt, Germany, to London to New York, the euro was traded officially for the first time, passing its first significant test as a currency to bind 11 European Union countries.From a starting point of $1.1668, it traded at a high of $1.1877 before falling back to $1.1820 in late European trading.

THE ALMIGHTY dollar faces a rival in financial transactions. The euro exists, though you cannot see it. The currencies of Austria, Belgium Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain still circulate, but were glued together on New Year's Day.Each took a fixed rate of exchange to a unit of account called the euro. Control over their supply and interest rates passed from each nation's central bank to the European Central Bank in Frankfurt. They are really one currency; they just look different.

THE ALMIGHTY dollar faces a rival in financial transactions. The euro exists, though you cannot see it. The currencies of Austria, Belgium Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal and Spain still circulate, but were glued together on New Year's Day.Each took a fixed rate of exchange to a unit of account called the euro. Control over their supply and interest rates passed from each nation's central bank to the European Central Bank in Frankfurt. They are really one currency; they just look different.

NOW THAT Asia is becoming the economic wreck foreseen by the canny, talk of reform has risen from the moot to the academic to the urgently topical.Papers by obscure analysts at Treasury are doubtlessly nesting inside diplomatic pouches, and the notion of geo-financial overhaul on the scale of the 1944 Bretton Woods agreements is no longer just chitchat over Campari at Geneva's Hotel de la Paix.Prescriptions teem.Asian banks are overexposed weaklings; the cure is fatter capital requirements.

PARIS -- The future of Europe was decided last week, even though the Europeans do not yet realize it. There are to be two ''Europes,'' not one.Last Tuesday the European Commission told the European Parliament that it recommended inviting five former Soviet-bloc countries to join the EU. These are the three already invited to join NATO -- the Czech Republic, Poland and Hungary -- plus Estonia and Slovenia.The next day, the commission took note of the radical structural changes necessary to make the European Union work, but postponed acting on them until the new millennium.

Two weeks ago Steve Hanke stood at the East Asia Economic Summit in Hong Kong and predicted, in certain terms, that the region's troubles would wash to the West and drown the U.S. stock market."

WASHINGTON -- Southeast Asian governments are primarily to blame for the recent currency troubles in that region, and any attempt by these nations to place controls on the cross-border flow of investment will have "adverse, unintended consequences," Federal Reserve Chairman Alan Greenspan said yesterday.Thailand was forced to devalue its currency, the baht, after it came under speculative attack in early July.The baht has lost more than half its value since its June peak against the U.S. dollar, and the contagion spread to Indonesia, Malaysia and the Philippines.

LONDON -- The last of the annual British party conferences finished last week with the Tories at Bournemouth. Both Labor and Conservative conferences ended on a question the party's members could not -- not yet -- answer.For Labor it was whether they can get to the election (latest, next May) with the magic intact. Labor's lead now seems overwhelming. Can Tony Blair and the party's other new leaders avoid some ghastly error which would hand the Tories, who have been in power now for 17 years, still another term?

As the dollar falls against the euro, yen and other major currencies, China and other emerging economic powers holding lots of dollars and U.S. securities are crying foul - and urging an end to the dollar's central status in global commerce. If they are truly disgusted, they should look to themselves for answers. Since the end of World War II, the dollar has largely replaced gold as the reserve asset central banks hold to back up national currencies. The supply of gold is too limited, and efforts to back up currency with gold would result in chronic shortages of liquidity and global deflation.

Money-savers on the road Americans spend close to $2,500 on a typical summer vacation, one of the larger expenditures a family makes in a year. The fun of a great trip, however, quickly evaporates if there is a huge credit card bill to pay when you return home. Here are ways to trim expenses once you hit the road: 1. Ask for a break -- Hotels, restaurants, car rental agencies and attractions, including theme parks and museums, often offer discounts to members of large groups, such as AAA or AARP.

The dollar dropped sharply yesterday against a range of major currencies, with the euro breaking through $1.30 for the first time in a year and a half. The fall highlighted concerns about softness in the American economy as economies abroad continue to expand. The currency sell-off came as investors weighed a number of issues that complicate U.S. prospects in the coming months, including a huge trade imbalance with China and a slowing domestic housing market. On top of that, economic growth in some European countries is gaining momentum, threatening to siphon investment away from the dollar.

Scheduled at the Baltimore Convention Center, Howard and Pratt streets: July 16 Baltimore Coin and Currency -- convention and trade show. Estimated attendance: 6,000+. Contact: 301-424-1876 July 17-19 New Psalmist Baptist Church -- convention. Estimated attendance: 8,000+. Contact number: 410-945-3000

There's not a lot of mystery involved in cruising the Caribbean. Ports there have been written up hundreds of times, and tourism has been big business for decades. But on a Holland America cruise last spring transiting the Panama Canal, that wasn't necessarily the case. For some of the stops in Central and South America, even with the Internet, information can be sparse. Some general tips about these ports: U.S. dollars are universally accepted, though you may get your change back in, for example, Colombian pesos.

SOMETIMES, market-moving news fails to move markets. China's decision to unlink its currency from the U.S. dollar barely fazed Wall Street, even though global news wire Reuters called it "the biggest financial story of the year." The news broke July 21, a day that saw a second terrorist attack on London's transit system and congressional testimony by Federal Reserve Board Chairman Alan Greenspan. A flurry of expert advice on how to "play" the China currency story ensued: Bet against the dollar and Treasury securities; sell Wal-Mart Stores Inc. and other retailers that import from China; buy commodity futures.

WASHINGTON - Even as it publicly pressures China to let its currency rise in value, the Bush administration has quietly softened a crucial demand. In a calculated shift, administration officials have stopped demanding that China let it currency, the yuan, float freely against other major currencies. Instead, American officials are telling Chinese leaders that they can keep their policy of a fixed exchange rate - at least for now - if they increase the yuan's value by 10 percent to 15 percent.

WASHINGTON - The Bush administration warned China yesterday that its currency policies are having a "highly distortionary" impact on global trade, and hinted that they could lead to economic sanctions. But the Treasury Department stopped short of declaring China to be a manipulative trading partner. In its required semiannual report to Congress on currency practices, the Treasury Department warned that "if current trends continue without substantial alteration, China's policies will likely meet the ... technical requirements for designation" as a manipulator under a 1988 law. That move would trigger negotiations with Chinese leaders.

A Bay Bridge maintenance worker was arrested yesterday by Maryland Transportation Authority Police detectives in an alleged counterfeiting and money-laundering scheme. Kennan F. Ray, 43, of the first block of Stonecroft Road in Baltimore was charged with counterfeiting and passing phony currency to tollbooth operators, according to District Court records. Police said he laundered phony $20 bills through toll operators to obtain valid U.S. currency. Detectives said Ray, who was assigned to sanitation duties at the bridge, approached at least five tollbooth workers with counterfeit cash in the past week, asking for change.

A Bay Bridge maintenance worker was arrested yesterday by Maryland Transportation Authority Police detectives in an alleged counterfeiting and money-laundering scheme. Kennan F. Ray, 43, of the first block of Stonecroft Road in Baltimore was charged with counterfeiting and passing phony currency to tollbooth operators, according to District Court records. Police alleged that he laundered phony $20 bills through toll operators to obtain valid U.S. currency. Detectives said Ray, who was assigned to sanitation duties at the bridge, approached at least five tollbooth workers with counterfeit cash in the past week, asking for change in other bills.