oil and the dollar

[low_delta]

Interesting that Opec is discussing the low value of the US dollar. I imagine our market would collapse if they stop trading oil in dollars. Many people believe that taking over Iraq was a ploy to stop this change from happening, since Saddam was threatening to do just that. In other words, the war was not about regime change, but about protecting our economy from a total collapse.

They day Opec announces they are switching to the Euro, the dollar will plummet. Fortunately for us, this very fact is stopping them from doing so, since they'd get stuck with a lot of dollars.

Comments

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[whorlpool.livejournal.com]

The dollar has already plummeted terribly. It's dropped in value against the Canadian dollar between 20% and 30% this year. That means that the money I have in US banks is now worth up to 30% less than it was eleven months ago. Kind of a shocker if you think about it. It's hard not to sympathize with the leader of Iran when he says the US dollar is a worthless piece of paper, and it's hard to imagine what's eventually going to stop countries like China and the OPEC nations from moving their money to another currency if the US government doesn't finally take some action to strengthen the dollar.

Re: ..

[low-delta.livejournal.com]

Predictions are that OPEC will not be switching any time soon. But I'm not sure if the indicators of fifty years ago still hold true. And even if OPEC doesn't switch, I'm not so sure about China. But then China is hoping the world switches to the Yuan, so maybe they'll just pressure the nations around them to switch.

Who knows. It's a convoluted game.

[marswalker.livejournal.com]

about 5 years ago or so a leading economic indicator was that drug dealers started carrying euros instead of dollars...

oil can't be far behind.

[mummm.livejournal.com]

Which is why we need cars and other equipment that doesn't run on oil. Then we can all tell them *nuts to you!*

[low-delta.livejournal.com]

That will help our trade defecit, but the value of the dollar is increased by the demand for it by other countries. If OPEC switches to the Euro, the world market will be flooded with US dollars, and their value will go way down. And our economy's already a bit precarious.

Fortunately, predictions are that OPEC will not switch soon.