The United States dollar, denoted by USD or the symbol $, is the official currency used in the United States. Commonly referred to as the "American dollar," the currency is divided into 100 cents (symbol ¢). A further division includes 1,000 mills to a dollar, though this division is largely unknown to the general public and only sometimes used in matters of tax levies.
When currently issued in circulating form, denominations equal to or less than a dollar are emitted as U.S. coins while denominations equal to or greater than a dollar are emitted as Federal Reserve notes. (Both one-dollar coins and notes are produced today, although the note form is significantly more common.) In the past, paper money was occasionally issued in denominations less than a dollar and gold coins were issued for circulation up to the value of twenty dollars.
The United States Mint is in charge of producing the nation's coins, while the Bureau of Engraving has printed banknotes and Printing for the Federal Reserve since 1914. Note size used to be very large but switched over to a smaller size in 1928; reasons for this switch, however, are unknown.
The dollar is considered the standard unit of currency in commodity markets across the globe (namely gold and oil). At the present time, the U.S. dollar remains the world's foremost reserve currency, primarily held in $100 denominations. The majority of U.S. notes are actually held outside the United States. According to economist Paul Samuelson, the overseas demand for dollars allows the United States to maintain persistent trade deficits without causing the value of the currency to depreciate and the flow of trade to readjust. In 1995, over $380 billion (380 G$) in U.S. currency was in circulation, two-thirds of it overseas. As of April 2004, nearly $700 billion was in circulation, with an estimated half to two-thirds of it still being held overseas.
Usage
A few nations besides the United States use the U.S. dollar as their official currency. Ecuador, El Salvador and East Timor all adopted the currency independently; former members of the US-administered Trust Territory of the Pacific Islands (namely Palau, the Federated States of Micronesia and the Marshall Islands) decided that, despite their independence, they wanted to keep the U.S. dollar as their official currency. Additionally, local currencies of several states such as Bermuda, the Bahamas, Panama and a few other states can be freely exchanged at a 1:1 ratio for the U.S. dollar. Finally, a number of nations have tied their currencies to the U.S. dollar - including Argentina (1:1 fixed exchange rate from 1991 until 2002), Lebanon (one dollar = 1500 Lebanese pound), Hong Kong (one U.S. dollar = HK$ 7.8 since 1983), and several more. A significant recent development is the action of the People's Republic of China: the renminbi had once been informally and controversially pegged to the dollar (since the mid-1990s, at 1 U.S. dollar = 8.28 Y); however the peg was removed on July 21, 2005. Instead, China has a managed float against a basket of currencies.
Moody's Rating
Aaa
S&P Rating
AAA
Sovereign credit ratings play an important part in determining a country's access to international capital markets, and the terms of that access. Sovereign ratings help to foster dramatic growth, stability, and efficiency of international and domestic markets.
What does it look like?
Political Structure
The United States government can be best described as a republic or liberal democracy. More specifically, the United States is a representative democracy with three levels of government all freely elected by the American people: federal, state and local.
Federal Government The federal government is the national government, whose powers are limited by the Constitution to defense, foreign affairs, printing money, controlling trade and relations between the states, and protecting human rights. In addition to these powers, the federal government has extended the powers beyond their explicit statements into welfare and education (citing the "necessary and proper" clause of the Constitution). The federal government is comprised of the Congress (legislative branch), President (executive branch) and Supreme Court (judicial branch). Each branch applies checks and balances on each other.
The President of the United States who serves as Commander in Chief of the Armed Forces leads the executive branch. The President signs laws into action and can issue pardons and executive orders. His other Constitutional duties are few, of them the State of the Union address to Congress being the most important. Below the President is the Vice President who is first in line of succession and is the President of the Senate (with the ability to cast a tie-breaking vote). Both the President and Vice President are elected by the people via an Electoral College, and serve four-year terms. Finally, the Cabinet also holds a role in the executive branch. The Cabinet is composed of various departments (Defense, Justice, State, etc.). These departments and their heads hold much regulatory and political power, and it is these departments that are used to executive the nation's laws.
In the legislative branch is the Congress, a bicameral institution composed of the House of Representatives and the Senate. Meeting in the United States Capitol in Washington, D.C., the two houses (lower and upper, respectively) work to make laws for the nation. The House has 435 members called representatives (or congressmen and congresswomen), who are elected by the people of a congressional district to represent that district for a two-year term. The Senate has 100 members called senators, who are too, elected by the people of a state to represent that state; in this case, however, terms are six years long. Each state, regardless of its size, has two senators.
The judicial branch of the federal government is used when dealing with federal and constitutional matters. The highest court is the Supreme Court, which consists of nine justices; the Court can declare legislation unconstitutional regardless of the level at which it was made, thus nullifying the law and creating a precedent for future law and decisions. Below the Supreme Court are the appeal courts, and finally the district courts, which are the general trial courts for federal law.
State and Local Governments From an everyday perspective, state governments have the greatest influence on the people. Each state has its own written constitution and distinct laws. There are often large discrepancies in law and procedure between different states on issues such as property, crime, health, and education. The highest elected official of each state is the Governor. Each state also has an elected legislature (which is bicameral in all states but Nebraska); members represent the different parts of the state. Each state maintains its own judiciary, with the lowest level typically being county courts, and culminating in a supreme court. In some states, the people elect supreme and lower court justices; in others, they are appointed, as they are in the federal system.
The institutions that are responsible for local government are typically town, city, or county councils, making laws that affect their particular area. These laws concern issues such as traffic, the sale of alcohol and keeping animals. The highest elected official of a town or city is usually the mayor. In New England, towns operate directly democratically, and in some states, counties have little or no power, existing only as geographic distinctions. In other areas, county governments have more power, such as to collect taxes and maintain law enforcement agencies.
Prominent Figures
President: George W. Bush
Vice President: Richard B. Cheney
Secretary of State: Condoleezza Rice
Attorney General: Alberto Gonzalez
President's Chief of Staff: Joshua Bolton
Chairman of the Federal Reserve: Ben Bernanke
Key Economic Factors
Economic Overview:The United States has the largest and most technologically influential economy with the world, with a remarkable per capita GDP of $40,100 (second highest in the world after Luxembourg). Private individuals and business firms make most of the decisions in this economy as it is extremely market-oriented; federal and state governments buy needed goods and services predominantly in the private marketplace. Though US business firms enjoy relatively high flexibility in decisions to expand capital plants, lay off workers and develop new products, they too face substantially higher barriers to entry in their rivals' home markets (than barriers to entry of foreign firms in US markets). Firms in the United States are at or approaching the forefront in technological advances, namely in computers and medical, aerospace and military equipment. This onrush of technology is largely responsible for the gradual development of what is often called a "two-tier labor market" - those at the bottom lack the education and professional skills of those at the top and increasingly fail to get comparable pay raises, health insurance, and other normal benefits. In the last three decades (since 1975 in particular), practically all gains in household income have gone to the top quintile of households. The resilience of the United States' economy was demonstrated in the response to the terrorist attacks of September 11, 2001. The war on Iraq in March/April 2003, followed by occupation of Iraq, required a large shift of resources to the United States Military. Notable increases in energy prices negatively affected the economy in the second half of 2004. The United States economy, in the long term, must consider problems such as inadequate investment in economic infrastructure, the rapidly rising medical and pension costs of an aging population, the twin deficits (trade and budget), and stagnation of family income in lower economic groups.
Key Industries:
Leading industrial power in the world, highly diversified and technologically advanced; petroleum, steel, motor vehicles, aerospace, telecommunications, chemicals, electronics, food processing, consumer goods, lumber and mining.
Agricultural Products: Wheat, corn, other grains, fruits, vegetables, cotton, beef, pork, poultry, dairy products; forest products and fish.
Export Commodities: Agricultural products (soybeans, fruit, corn) 9.2%, industrial supplies (organic chemicals) 26.8%, capital goods (transistors, aircraft, motor vehicle parts, computers, telecommunications equipment) 49.0% and consumer goods (automobiles, medicines) 15.0%. All figures as of 2003.
Import Commodities: Agricultural products 4.9%, industrial supplies 32.9% (crude oil 8.2%), capital goods 30.4% (computers, telecommunications equipment, motor vehicle parts, office machines, electric power machinery) and consumer goods 31.8% (automobiles, clothing, medicines, furniture, toys). All figures as of 2003.
