. In December 2001 I wrote a letter to the president of the European Central Bank (See copy of the original letter below). One month later I received a letter from the European Central Bank (ECB) in response to my letter. In March 2002, I wrote an article which was published on a Brazilian newspaper were I quote my letter and the response of the ECB. Since I sent the enclosed letter to the president of the European Central Bank in December 2001 the US dollar has declining steadily in value against the Euro, and gold has increased in value from $ 295 to around $ 420 today. When I wrote that letter to the European Central Bank in December of 2001 many people were predicting that the Euro was going to fall further in relation to the US dollar. When I published the content of my letter in a newspaper article in March 2002 I received many letters to the editor and emails saying that I was very negative, and that I did not know what I was talking about, and so on. I also wrote an article which was published in June 2002 - âThe Euro, Now.â The information that follows I am quoting from that article: ******** Article published in June 2002: âThe Euro, Nowâ On December 12, 2001 I sent the enclosed letter to the president of the European Central Bank, regarding Brazil adopting the euro as its new currency. In January 2002. I received a letter from a senior official of the European Central Bank in response to my letter. I was pleasantly surprised by the content of that letter. It is clear to me by their answer, that the door is open to Brazil at the European Central Bank, if Brazil decides to adopt the euro as its new currency. In my letter to the president of the European Central Bank I mentioned that the US dollar was overvalued over the price of gold at US$ 295/oz at that time and the euro trading at US$ .85Â¢. Six months later, on June 4, 2002, gold was trading at US$ 325/oz and the euro was trading at US$ .95Â¢; during this period the US dollar declined in value by 10.2 percent in relation to gold and also declined by 11.8 percent in relation to the euro. The alarm bells finally started ringing in the United States and abroad. The Business Week magazine issue of May 6, 2002 had an article entitled "Debt Overseas Stirs up Trouble at Home, " in which the magazine stated, "The growing current-account deficit might set the U.S. up for a fall. U.S. financial obligations to the rest of the world are once again on the rise as America grows ever more dependent on foreign capital to finance its growth. Back in March, Federal Reserve Chairman Alan Greenspan noted that over the past six years, about 40 percent of the increase in the U.S. capital stock was financed by foreign investment, a pattern that will require an ever-larger flow of interest payments going out to foreigners. "Countries that have gone down this path invariably have run into trouble," said Greenspan, "and so would we." The Economist magazine issue of April 27th- May 3rd, 2002, also had a similar article on the US current-account deficit. It was called "The O'Neill doctrine". According to the British publication, "America's huge external deficit is an accident waiting to happen. (...) The International Monetary Fund says that America's current-account deficit poses one of the biggest risks to the world economy. (...) If capital inflows were to dry up, the current-account deficit would have to shrink, either through a slump in domestic demand or a fall in the dollar, or both. "A study by the Federal Reserve of large current-account deficits in developed economies found that deficits usually began to reverse when they exceeded 5 percent of GDP. And this adjustment was accompanied by an average fall in the nominal exchange rate of 40 percent along with a sharp slowdown in GDP growth. America is likely to move into this danger-zone by the end of the year." The New York Times published on May 2, 2002, the article "Dollar Falls as Top Official Casts Doubt on Intervention". They wrote: "After saying his goal was to avoid upsetting the financial markets, Treasury Secretary Paul H. O'Neill did just that today by sparring with members of a Congressional committee about the nation's financial condition and leaving some investors with doubts about his willingness to defend the weakening dollar. â¦The Washington Post had an article on May 29, 2002 by Robert J. Samuelson: Superdollar: Friend or Foe " In it, Samuelson writes, "If you want to scare yourself, contemplate the following. The dollar begins to fall. That is, its value slips relative to other currencies. Foreigners with massive investments in U.S. stocks and bonds begin to sell their holdings. They fear currency losses on their American investments because a depreciated dollar would fetch less of their own money. The selling then feeds on itself. The stock market swoons. American consumer confidence withers. The recession resumes and spreads to the rest of the world through lower U.S. imports. (â¦) There are huge foreign investments in the United States that could be sold quickly. At the end of 2001, foreigners owned $1.7 trillion of U.S. stocks and $3.2 trillion of government and corporate bonds. The conditions for a dollar crisis exist, but that doesn't mean one will happen". Avoiding Chaos in Brazil â¦Now that we know for a fact that adopting the euro is a viable option for Brazil, then it is imperative that the Brazilian government moves in that direction as soon as possible, before the smart money starts leaving Brazil and starts a stampede. *** End of Part - 1 .