Argentina has been on a decades-long search for economic stability, but it always seems to be out of reach. High inflation has been plaguing the country and just surpassed 160% a year.

Over the past couple of years, the local currency has collapsed. One U.S. dollar used to be worth 20 Argentinean pesos in 2018. Today, one U.S. dollar is worth 1,000 pesos on the black market. And that means for Argentineans, the real prices of everything — from groceries to gas — have spiked.

In a country where the local currency is in free fall, promising to replace that currency with the US dollar can seem like a magical solution.

Argentina's new president, Javier Milei, won in part by promising to do just that - to dollarize. To scrap Argentina's peso and replace it with the relatively stable, predictable, boring United States dollar.

On today's show, what does dollarizing mean? Why dollarize, how to do it, and will it even work?

For more:A black market, a currency crisis, and a tango competition in Argentina (Apple, Spotify, NPR)Venezuela's Fugitive Money TradersWhy Ecuador Uses The Dollar? : The Indicator from Planet MoneyHelp support Planet Money and get bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.

Learn more about sponsor message choices: podcastchoices.com/adchoices

NPR Privacy Policy