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There are people saying that one of these days, the dollar will not be the world's reserve currency.
When the major countries, get together and say, "we won't take dollars any more," then what happens?
There was just an announcement on CNBC. The ECB is thinking about creating EURO bonds so as to eliminate Italian bonds and German bonds, etc.
Have a EURO bond for other countries to buy, instead of U.S. bonds.
Such talk can destroy the dollar as the world's #1 reserve currency.
China has over $1 Trillion of our debt. What in the heck are we doing selling our debt, that is out of control, to China?
China is looking for alternatives as we speak. They do not want to take the risk, that is created by a disfunctional government which can not come up with a plan to cut the deficit by $4 trillion over 10 years. They turn their noses up at S&P and come up with $2.5 trillion, some of which is not even reality yet. Some of it is based on $$ saved by getting out of Afghanistan on a timetable. So Congress has created a $2.5 Trillion plan they may not be able to back up.
Since 1971, the U.s Dollar is backed by Opec's oil, rather than gold. A resource far more important in the modern world. Until this arrangement is ended, the U.s will remain the World's Reserve Currency. It can only end if one of the U.s Pillars of hegemony is taken down: The dollar keeps the military strong and the military keeps the dollar strong. However, I will agree that both pillars are beginning to crumble.
Quote:
Viewed from a different angle, an oil price ceiling is a dollar floor. Oil is traded in greater dollar volumes than any other commodity so the oil standard had more liquidity than gold ever did.
According to the December 20, 2004 issue of the Oil and Gas Journal, the oil reserves of OPEC at yearend 2004 are estimated to be 885 billion barrels. The oil equivalent of Fort Knox was not the Strategic Petroleum Reserve; it was the combined oil reserves of OPEC, three orders of magnitude greater and much larger in value than all the gold mined since the dawn of history.
According to the United States Geological Survey, the total gold ever mined in the world is about 3.4 billion troy ounces. At $42 per barrel for oil and $420 per troy ounce for gold, the value of Opec's reserves is 26 times the value of all gold ever mined.
Also, the Euro itself is showing cracks. Does anyone think Germany is going to foot the bill for the problems of other countries that are flaring up? IE Spain, Italy, and Greece.
Since 1971, the U.s Dollar is backed by Opec's oil, rather than gold. A resource far more important in the modern world. Until this arrangement is ended, the U.s will remain the World's Reserve Currency. It can only end if one of the U.s Pillars of hegemony is taken down: The dollar keeps the military strong and the military keeps the dollar strong. However, I will agree that both pillars are beginning to crumble.
Also, the Euro itself is showing cracks. Does anyone think Germany is going to foot the bill for the problems of other countries that are flaring up? IE Spain, Italy, and Greece.
But, as far as gold, there is a finite amount of gold. It is not limitless.
Well over 90% of the world's gold is already out of the ground.
Don't quote me on the 90%, but the % is very high.
But, as far as gold, there is a finite amount of gold. It is not limitless.
Well over 90% of the world's gold is already out of the ground.
Don't quote me on the 90%, but the % is very high.
There is also basically a finite amount of oil. As I said, the U.s Dollar is backed by the value of Opec's oil. Today, black gold means far more than gold. It's also backed by the U.s military. History has shown what happens when you back a country into a corner and force it to fight for survival and its standard of living. We wouldn't want to see the day when the U.s is forced to unleash unrestricted warfare with its airforce, navy, and nuclear arsenal.
Iraq found out what happens when you attack the Dollar. They stopped accepting dollars for their oil and broke the OPEC agreement. Within one year, it was attacked and the arrangement was restored. It sent a very clear message to the rest of the world.
Iraq found out what happens when you attack the Dollar. They stopped accepting dollars for their oil and broke the OPEC agreement. Within one year, it was attacked and the arrangement was restored. It sent a very clear message to the rest of the world.
But.... but.... but... but.... Bush and Cheney said it was all about Osama Bin Laden?!!!! Whaaaat!! You mean our politicians lie?!
But.... but.... but... but.... Bush and Cheney said it was all about Osama Bin Laden?!!!! Whaaaat!! You mean our politicians lie?!
The funny thing about Bin Laden was that his goal was to bankrupt the United States. He laughed about how easy it was to get us seeing red and seeking revenge on any corner of the globe. The policy that we followed after 911 actually weakened dollar hegemony significantly and could very well eventually cost us the reserve currency and standard of living we have enjoyed. All along he wanted to attack the two pillars of American Hegemony to force us to pull back our empire, which was why he hit the World Trade Center (U.s economy/Dollar) and Pentagon (military). If it was simply about "killing Americans" there are plenty of better targets.
What position would we be in today if we didn't play into his hand? If we spent all of that money on infrustructure, schools, and medical care? The American media and patriots in this country have a stunning level of stupidity. We killed him, but he may get his wish and have the final laugh. Like an Internet troll, the only way to defeat him or her is (or should I say WAS)to ignore them.
However, it's fairly obvious that American foreign policy makers used the 911 attacks (that occured as a result of 80 years of American empire) as a way to rally the public for war to achieve their goals. ‪Blowback definition‬‏ - YouTube
Of course, we have seen this time and time again---most notably in world war 2.
Quote:
"...cutting off a country's oil or gas is a proven path to war. In 1941, the United States froze Japan's assets, denying her the funds to pay for the U.S. oil on which she relied, forcing Tokyo either to retreat from her empire or seize the only oil in reach, in the Dutch East Indies. The only force able to interfere with a Japanese drive into the East Indies? The U.S. Pacific fleet at Pearl Harbor
Feigning innocence when the blow back comes. Rally cry.
USS Maine....or the Tonkin Gulf...
Last edited by Thatsright19; 08-07-2011 at 09:00 PM..
Yep indeed, China is out looking for another trading partner. Alas everyone keeps telling them sorry, go sell more to the United States.
If China was really looking for "another way", they would release their semi-pegged currency. I see little signs of it. I mean if I were China sure I'd love to diversify, but it just doesn't work when you depend so heavily on the US economy to feed your growth.
Have you been following the economy at all? The Euro won't stand. Even in this crappy condition, the dollar looks good. How sad is that?
we are still the best house in the worst neighborhood.
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