ABSTRACT
On January 1, 1999, the European Monetary Union (EMU) came into effect, substantially changing international monetary relations. The most industrially developed nations of Western Europe established a common currency, the Euro, and founded the European Central Bank, which is responsible for coordinating EU monetary policy. The establishment of the EMU and a common currency has created an entirely new situation for U.S.—EU relations that will undoubtedly affect trade relations, investment activities, and the future of the global monetary system. The EMU and the creation of the Euro have shifted power relations in favor of Europe, which has become the world’s second largest economic power after the United States. The United States, as leader of the global economy, has an ambitious and thoroughly complicated role to play, and there are many people who often unfairly criticize US economic policy and its results.
