Why is Bush so bent on war with Iran? For the same reason he rushed to war in Iraq. They have a weapon that can destroy the American economy — switching from dollars to euros for oil sales:
“Iran Drops Dollar From Oil Deals: report 12/8/07
“TEHRAN (AFP) — Major crude producer Iran has completely stopped carrying out its oil transactions in dollars, Oil Minister Gholam Hossein Nozari said on Saturday, labelling the greenback an “unreliable” currency.
” ‘At the moment, selling oil in dollars has been completely halted, in line with the policy of selling crude in non-dollar currencies,’ Nozari was quoted as saying by the ISNA news agency.
” ‘The dollar is an unreliable currency, considering its devaluation and the oil exporters’ losses,’ he added.
“The world’s fourth largest oil exporter, Iran has massively reduced its dependence on the dollar over the past year in the face of US pressures on its financial system and the fall in the dollar.
“Nozari did not specify in which currencies Iran was now being paid. In the past, officials have said most oil income was in euros, with a significant percentage in yen…”
Some say that is why Bush invaded Iraq:
“Dollar vs EURO — Weapons of Mass Destruction Published May 2003 (Updated February 2004)
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| Duelling currencies — the weapons of mass destruction
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“There were weapons of mass destruction in Iraq, in the form of EURO currency. The petrodollar depends upon Iraq’s oil reserves to defend the United States dollar against the EURO and other currencies. In 2001, well before Iraq’s invasion, the dollar faced uncertainty as an overpriced, debt heavy currency against a new and robust EURO. In early 2004, the dollar is losing ground.
“The economics will change however. Now that The United States of America has taken both Iraq and Afghanistan and owns those country’s natural resources, the dollar plans a brighter future, or a stable one at best. Iraq trades (again) in dollars. The White House said all along they were freeing Iraqis and Afghanis from tyranny, and searching for weapons of mass destruction, and that the US-military was not invading those countries for oil, but that wasn’t true.
“War protesters claimed George W Bush was invading Iraq for oil. That was only partly true, and their cries for peace were uninformed. US-led invasions of Iraq and Afghanistan were for oil, but not for consumption. Pre-Iraq invasion, Saddam Hussein was trading in EUROs…”
Note that the above report was from 2004 and with Iran now switching to Euros, the same threat exists.
With the US hemorrhaging dollars for imported goods, China and OPEC have amassed huge reserves of dollars. If they were to sell them off for Euros, and with the dollar backed by nothing but the trust of its users, the economy would implode.
Is there hope?:
“A full-blown dollar collapse would be disastrous. Thankfully, it need not happen
“The weather may be cold and wet, but in the rich world’s financial markets it is beginning to feel like August all over again. Credit spreads have widened and shares are pitching from gloom to elation as investors look to the Federal Reserve for solace. The anxiety is unmistakable. But this time the scare is about more than bad mortgage loans and their baleful effect on the credit markets. America may be falling into recession. And a new fear now stalks the markets: that the dollar’s slide could spin out of control (see article).
“A full-blown dollar crisis on top of a credit crunch and a weakening economy would be frightening. It would send financial markets reeling and tie the hands of the Fed, perhaps forcing it to raise interest rates even as recession looms. The sky-high euro would soar further, choking off Europe’s growth. Political tensions would also rise. Already Airbus has called the dollar’s decline “life-threatening” and France’s president, Nicolas Sarkozy, has given warning of “economic war”.
” At worst, the shadows could darken further. For half a century the dollar has been the hegemonic currency. A large slice of global trade is counted in dollars. Central banks hold most of their foreign-exchange reserves in dollars, a boon for America that has allowed it to issue debt more cheaply. That dominance has survived dollar slides before, as in the late 1970s and mid-1980s. But now, with the euro as an alternative, the fear is of a sudden shift in the global monetary system, with investors switching quickly from one currency to the other…”
Any economists care to comment?
December 10, 2007 at 9:40 pm
I’m no economist but Krishna has something to add here.
“They believe that to gratify the senses is the prime necessity of human civilization. Thus until the end of life their anxiety is immeasurable. Bound by a network of hundreds of thousands of desires and absorbed in lust and anger, they secure money by illegal means for sense gratification.”
- BG 16.11-12
Many economists believe that after gold no longer backed the dollar, America’s economy became as fragile as a drop of water on a lotus petal. Prabhupada also knew this. Without bullying, America will lose leverage. Without leverage, America the Goliath will be target practice for the hundreds of Davids. At this stage, it’s not so hard to say that this is inevitable.
The real question is, whether now or in the aftermath, who will realize that the true cause of our woes is the sensate culture we have created?
December 11, 2007 at 9:38 am
I hear that.
I have an idea for a post that will be titled “Merry Giftmas and Happy Mallidays” addressing one aspect of that question.