Arab States Launch Secret Moves To Stop Using U.S. Currency For Oil Trading

B

blackascoal

The Force is With Me
In the most profound financial change in recent Middle East history, Gulf Arabs are planning - along with China, Russia, Japan and France - to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.

Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.

The plans, confirmed to The Independent by both Gulf Arab and Chinese banking sources in Hong Kong, may help to explain the sudden rise in gold prices, but it also augurs an extraordinary transition from dollar markets within nine years.

The Americans, who are aware the meetings have taken place - although they have not discovered the details - are sure to fight this international cabal which will include hitherto loyal allies Japan and the Gulf Arabs. Against the background to these currency meetings, Sun Bigan, China's former special envoy to the Middle East, has warned there is a risk of deepening divisions between China and the US over influence and oil in the Middle East. "Bilateral quarrels and clashes are unavoidable," he told the Asia and Africa Review. "We cannot lower vigilance against hostility in the Middle East over energy interests and security."

This sounds like a dangerous prediction of a future economic war between the US and China over Middle East oil - yet again turning the region's conflicts into a battle for great power supremacy. China uses more oil incrementally than the US because its growth is less energy efficient. The transitional currency in the move away from dollars, according to Chinese banking sources, may well be gold. An indication of the huge amounts involved can be gained from the wealth of Abu Dhabi, Saudi Arabia, Kuwait and Qatar who together hold an estimated $2.1 trillion in dollar reserves.

The decline of American economic power linked to the current global recession was implicitly acknowledged by the World Bank president Robert Zoellick. "One of the legacies of this crisis may be a recognition of changed economic power relations," he said in Istanbul ahead of meetings this week of the IMF and World Bank. But it is China's extraordinary new financial power - along with past anger among oil-producing and oil-consuming nations at America's power to interfere in the international financial system - which has prompted the latest discussions involving the Gulf states.

Brazil has shown interest in collaborating in non-dollar oil payments, along with India. Indeed, China appears to be the most enthusiastic of all the financial powers involved, not least because of its enormous trade with the Middle East.

******

"These plans will change the face of international financial transactions," one Chinese banker said. "America and Britain must be very worried. You will know how worried by the thunder of denials this news will generate."

Iran announced late last month that its foreign currency reserves would henceforth be held in euros rather than dollars. Bankers remember, of course, what happened to the last Middle East oil producer to sell its oil in euros rather than dollars. s after Saddam Hussein trumpeted his decision, the Americans and British invaded Iraq.

Read more at: http://www.huffingtonpost.com/2009/10/06/arab-states-have-launched_n_310826.html

Hmmmm .. this decline started about NINE YEARS AGO ... hmmmm .. what happened nine years ago that so changed the world?
 
Latin America is also on board with this .. led of course by Chavez. I wonder why Latin America would hate us?

The question is what happens whn the dollar is no longer the world's reserve currency?

Doom and gloom in the US .. deservedly so .. and the American people are to blame.
 
blackascoal said:
Latin America is also on board with this .. led of course by Chavez. I wonder why Latin America would hate us?

The question is what happens whn the dollar is no longer the world's reserve currency?

Doom and gloom in the US .. deservedly so .. and the American people are to blame.
Click to expand...

Nope. The elites who led us down this idiotic globalization scheme are to blame.

Don't blame the victims.
 
CaptBillyTheKid said:
Shame we haven't gone back to the gold standard yet.
Click to expand...

There are very good reasons why we aren't on the Gold Standard ...

Consequences for the Magnitude of Business Cycles:

Loss of control over economic policy. If the U.S. and a substantial number of other industrial economies adopted a gold standard, the U.S. would lose the ability to tune its economic policies to fit domestic conditions.

For example, in the spring of 1995 the dollar weakened against the yen. Under a gold standard, such a decline in the dollar would not have been allowed: instead the Federal Reserve would have raised interest rates considerably in order to keep the value of the dollar fixed at its gold parity, and a recession would probably have followed.

Recessionary bias. Under a gold standard, the burden of adjustment is always placed on the "weak currency" country.

Countries seeing downward market pressure on the values of their currencies are forced to contract their economies and raise unemployment.
The gold standard imposes no equivalent adjustment burden on countries seeing upward market pressure on currency values.

Hence a deflationary bias which makes it likely that a gold standard regime will see a higher average unemployment rate than an alternative managed regime.

The gold standard and the Great Depression.

The current judgment of economic historians (see, for example, Barry J. Eichengreen, Golden Fetters) is that attachment to the gold standard played a major part in keeping governments from fighting the Great Depression, and was a major factor turning the recession of 1929-1931 into the Great Depression of 1931-1941.

Countries that were not on the gold standard in 1929--or that quickly abandoned the gold standard--by and large escaped the Great Depression

Countries that abandoned the gold standard in 1930 and 1931 suffered from the Great Depression, but escaped its worst ravages.

Countries that held to the gold standard through 1933 (like the United States) or 1936 (like France) suffered the worst from the Great Depression
Commitment to the gold standard prevented Federal Reserve action to expand the money supply in 1930 and 1931--and forced President Hoover into destructive attempts at budget-balancing in order to avoid a gold standard-generated run on the dollar.

Commitment to the gold standard left countries vulnerable to "runs" on their currencies--Mexico in January of 1995 writ very, very large. Such a run, and even the fear that there might be a future run, boosted unemployment and amplified business cycles during the gold standard era.

The standard interpretation of the Depression, dating back to Milton Friedman and Anna Schwartz's Monetary History of the United States, is that the Federal Reserve could have but for some mysterious reason did not boost the money supply to cure the Depression; but Friedman and Schwartz do not stress the role played by the gold standard in tieing the Federal Reserve's hands--the "golden fetters" of Eichengreen.

Friedman was and is aware of the role played by the gold standard--hence his long time advocacy of floating exchange rates, the antithesis of the gold standard.
http://econ161.berkeley.edu/Politics/whynotthegoldstandard.html

In the words of Paul Krugman, "The Gold Standard is an Economic myth whose only benefit is it sounds good."

.. sort of like "free market" .. a concept that only exists in the minds of believers.
 
blackascoal said:
There are very good reasons why we aren't on the Gold Standard ...

Consequences for the Magnitude of Business Cycles:

Loss of control over economic policy. If the U.S. and a substantial number of other industrial economies adopted a gold standard, the U.S. would lose the ability to tune its economic policies to fit domestic conditions.

For example, in the spring of 1995 the dollar weakened against the yen. Under a gold standard, such a decline in the dollar would not have been allowed: instead the Federal Reserve would have raised interest rates considerably in order to keep the value of the dollar fixed at its gold parity, and a recession would probably have followed.

Recessionary bias. Under a gold standard, the burden of adjustment is always placed on the "weak currency" country.

Countries seeing downward market pressure on the values of their currencies are forced to contract their economies and raise unemployment.
The gold standard imposes no equivalent adjustment burden on countries seeing upward market pressure on currency values.

Hence a deflationary bias which makes it likely that a gold standard regime will see a higher average unemployment rate than an alternative managed regime.

The gold standard and the Great Depression.

The current judgment of economic historians (see, for example, Barry J. Eichengreen, Golden Fetters) is that attachment to the gold standard played a major part in keeping governments from fighting the Great Depression, and was a major factor turning the recession of 1929-1931 into the Great Depression of 1931-1941.

Countries that were not on the gold standard in 1929--or that quickly abandoned the gold standard--by and large escaped the Great Depression

Countries that abandoned the gold standard in 1930 and 1931 suffered from the Great Depression, but escaped its worst ravages.

Countries that held to the gold standard through 1933 (like the United States) or 1936 (like France) suffered the worst from the Great Depression
Commitment to the gold standard prevented Federal Reserve action to expand the money supply in 1930 and 1931--and forced President Hoover into destructive attempts at budget-balancing in order to avoid a gold standard-generated run on the dollar.

Commitment to the gold standard left countries vulnerable to "runs" on their currencies--Mexico in January of 1995 writ very, very large. Such a run, and even the fear that there might be a future run, boosted unemployment and amplified business cycles during the gold standard era.

The standard interpretation of the Depression, dating back to Milton Friedman and Anna Schwartz's Monetary History of the United States, is that the Federal Reserve could have but for some mysterious reason did not boost the money supply to cure the Depression; but Friedman and Schwartz do not stress the role played by the gold standard in tieing the Federal Reserve's hands--the "golden fetters" of Eichengreen.

Friedman was and is aware of the role played by the gold standard--hence his long time advocacy of floating exchange rates, the antithesis of the gold standard.
http://econ161.berkeley.edu/Politics/whynotthegoldstandard.html

In the words of Paul Krugman, "The Gold Standard is an Economic myth whose only benefit is it sounds good."

.. sort of like "free market" .. a concept that only exists in the minds of believers.
Click to expand...

note:
The ideas of these fools is what brought us to worst depression in 70 years. given that, their idiocy should be rejected outright.

Sound currency is crucial to maintaining real, as opposed to fictitious, valuations in the market.
 
AssHatZombie said:
Nope. The elites who led us down this idiotic globalization scheme are to blame.

Don't blame the victims.
Click to expand...

Sorry but I don't live in your world perpetual victimization.

There is only one entity ultimately responsible for the American government .. the American people.

SEE: The Declaration of Independence

Even though we are too stupid and controilled to recognize the bullshit we've been fed, it is still our responsibility.
 
blackascoal said:
Sorry but I don't live in your world perpetual victimization.

There is only one entity ultimately responsible for the American government .. the American people.

SEE: The Declaration of Independence

Even though we are too stupid and controilled to recognize the bullshit we've been fed, it is still our responsibility.
Click to expand...

Wrong. Our options are limited by the reality that only military industrial complex approved candidates can even afford to get their message out.

This democracy is 100% corrupted by elitists who will only finance certain throughts, stupid thoughts that lead to enslavement.
 
AssHatZombie said:
Wrong. Our options are limited by the reality that only military industrial complex approved candidates can even afford to get their message out.

This democracy is 100% corrupted by elitists who will only finance certain throughts, stupid thoughts that lead to enslavement.
Click to expand...

Whose responsibility is it to ensure sound government?

Whose responsibility is it to regain control of our government?

Who is to blame for our sorry state of government?

Chavez?

France?

Or just people you don't like?
 
blackascoal said:
Whose responsibility is it to ensure sound government?

Whose responsibility is it to regain control of our government?

Who is to blame for our sorry state of government?

Chavez?

France?

Or just people you don't like?
Click to expand...

The people are unable to ensure sound government when there is no real choice at the polls.

That's the truth of the matter.
 
AssHatZombie said:
The people are unable to ensure sound government when there is no real choice at the polls.

That's the truth of the matter.
Click to expand...

I agree with every word of that .. but the truth remains the same .. whose RESPONSIBILITY is it to save this country?

It's a responsibility we cannot meet if our minds are closed to alternatives and we continue to delude ourselves into thinking we are better than the rest of the world.

It's also a responsibility we cannot meet if we remain apathetic to truth. We were the last people on the planet to realize that the war on Iraq was a fraud .. and, as you are well aware, the last people on earth to believe the fairy-tale of 9/11.

While we claim to be fighting terrorism, we have a terrorist training camp right here on US soil.

If we have neither the courage nor intelligence to discern what is truth, then we fail in our responsibility and no one else is to blame but us, the American people. How many of us even have the courage to vote third party and against the tweedle-dee and tweedle-dum candidates of the two-party quagmire?
 
blackascoal said:
I agree with every word of that .. but the truth remains the same .. whose RESPONSIBILITY is it to save this country?

It's a responsibility we cannot meet if our minds are closed to alternatives and we continue to delude ourselves into thinking we are better than the rest of the world.

It's also a responsibility we cannot meet if we remain apathetic to truth. We were the last people on the planet to realize that the war on Iraq was a fraud .. and, as you are well aware, the last people on earth to believe the fairy-tale of 9/11.

While we claim to be fighting terrorism, we have a terrorist training camp right here on US soil.

If we have neither the courage nor intelligence to discern what is truth, then we fail in our responsibility and no one else is to blame but us, the American people.
Click to expand...

And I repeat. The people are precluded from electing suitable governance due to coroporatist corruption. So they are not to blame. The blame lies squarely with the internationalist fascists in charge.
 
AssHatZombie said:
And I repeat. The people are precluded from electing suitable governance due to coroporatist corruption. So they are not to blame. The blame lies squarely with the internationalist fascists in charge.
Click to expand...

So, according to you, the American people are hopelessly ignorant, impotent, and too afraid/inept to find solutions to better governance .. unless "international fascists" give it to them.

Still doesn't change or answer the question of whose responsibility our government belongs to.
 
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