June 12, 2012 3:50PM 

# How to Destabilize the Hong Kong Dollar 

By [Steve H. Hanke](https://www.cato.org/people/steve-h-hanke) 

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Mr. Joseph Yam, former chief executive of the Hong Kong Monetary Authority, has[ proposed](http://www.reuters.com/article/2012/06/12/hkma-idUSH9E8GN00P20120612) a package of policy changes that, if implemented, would undermine and destabilize the Hong Kong dollar—a unit that has been rock solid ever since Hong Kong established its currency board in 1983. And if you doubt that dire conclusion, [reflect](https://www.cato.org/pubs/papers/hanke_jprv5no4.pdf) on the fact that Argentina blew up its famed convertibility system (OK—it wasn’t a currency board, but only an unusual pegged setup) in 2001 by adopting a series of Yam-like measures.

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