OPEC leaders debate ditching the dollar.
By on Nov 19th, 2007 at 1:06 pm
OPEC leaders debate ditching the dollar.
The Observer reports that during OPEC’s meeting this past weekend, leaders of the oil-producing nations “argued that pricing – and selling – oil using the crippled dollar was damaging the cartel.” The meeting was supposed to have been private, but was mistakenly broadcast to the media for more than half an hour after a technician had incorrectly plugged the TV feed into the wrong socket. (HT: The Zoo)
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GET READY TO TUUUUMMMMBBBLE.
Bush/Cheney
Hague Trials ‘09
Buck Fush
November 19th, 2007 at 1:07 pmUh-oh. Time to Shock and Awe Saudi Arabia!!!
November 19th, 2007 at 1:07 pmRIP petrodollars 1972 – 2007
This is a big part of what kept US standard of living high.
The easy times ( e.g. cheap credit, bullshit real estate price appreciation ) are over.
It’s going to be tough sledding for many many Americans.
November 19th, 2007 at 1:07 pmI remember one other Middle East leader who tried to sell oil for Euros a few years ago. I wonder what happened to that guy.
November 19th, 2007 at 1:10 pm“…but was mistakenly broadcast to the media for more than half an hour after a technician had incorrectly plugged the TV feed into the wrong socket.”
Ha-Ha. Oh yeah. Nice little mistake that. Let’s dribble a little of this out and see what happens. Give those too big for their britches Americans something to ponder on while they’re chowing down on their turkey. Gobble, Gobble. Is the bigger turkey on the table or at the table? Gobble, Gobble.
November 19th, 2007 at 1:11 pmHot damn! Thanks for the hat tip, TP!!
Woo!
November 19th, 2007 at 1:13 pmThis was a “mistake” the same way we’re spreading “democracy” in the Middle East.
Checkmate, OPEC. Without firing a shot.
November 19th, 2007 at 1:13 pm“supposed to have been private.” Riiiiiiigghht.
A not-so-subtle message to bush and cheney (who would completely miss any more subtle message…).
November 19th, 2007 at 1:15 pmIf there’s ever been a more obvious warning shot fired across the bow of the Ship of State, I’ve not seen it.
November 19th, 2007 at 1:15 pmAnd India ditched the U.S. buck also. I look for the peso to surpass the U.S. dollar. Heckava job, Georgie…
November 19th, 2007 at 1:17 pmThanks for that “weak-dollar-theory” economics, Chimp-boy. It’s been great for inflating the profit margins for your buddies in the Oil Bid’nis and major Corporate Multi-nationals, but… Hey, wait a minute, what’s that I feel behind me? Oh yeah, it’s you and your greedy, evil laissez-faire buddies F!(KING us in the A$$!
November 19th, 2007 at 1:18 pmHmmm, yes, sometimes I wonder if they’re letting the dollar plunge so that people can’t afford to flee the country.
November 19th, 2007 at 1:21 pmfrom sunday’s IPCC thread:
i heard a snippet of a story about some “technicians†leaving a mic open and the press learning some inside info at the OPEC meeting…
anyone know what that was about???
Comment by katy — November 18, 2007 @ 11:25 am
now i know…
November 19th, 2007 at 1:24 pmDon’t worry,not yet…Saudi Arabia alone have few trillions invested in dollar. But if the trend continues and OPEC desert the dollar,some already did,then this can really hurt the dollar..specially if OPEC action is followed by China,South Korea and other big Treaurey papers holding countries in the Far East.
But America should put their act together and balance the books.
Spending on wars..like the Neocons plans were drawn will be devastating to the dollar and US economy..the same for the world economy.
Keep raising the Debt Ceiling,and not allowing taxes to bring in needed revenues,while spending continues to mashroom resulting in huge volume of borrowing is not a good healthy economical formula in the long run.
November 19th, 2007 at 1:25 pmThe signs are there,and America needs a leadership that cares..not only the administration,but also the Congress which approves spending.
Ruh roh
November 19th, 2007 at 1:39 pmHeckuva good way to leak information — haven’t heard of the “technician made a mistake” gambit before.
But now that the leak is out, will BushCo take the warning seriously? My guess is no. They will just continue to let the dollar sink into the quicksand. And as more and more countries abandon the dollar, Bush will just threaten to invade them with a stretched military. And as our dollar AND our military weaken, we become a paper tiger.
Great legacy, Bush!
November 19th, 2007 at 1:41 pmPreparing to Invade OPEC in 7, 6, 5, 4…
November 19th, 2007 at 1:41 pmThe US has been ‘buying’ its standard of living for many years by issueing billions of dollars in debt every week. As long as there are creditors willing to buy our debt, that standard would continue. When the creditors start finding other ways to invest their money (diversify), our ability to compete for the smaller share of credit will affect our country.
That is happening now with the diminished value of the dollar. The dollar is an investment – and a safe harbor – for those with investable resources. If they buy the dollars – by investing in our Treasury securities – and cannot earn a reasonable return on their investment, they will look elsewhere to invest their resources.
November 19th, 2007 at 1:44 pmwhen Hussein when off of Petro-dollars, the bush/neocon axis of evil invaded to replace Hussein. Does this mean we have to invade all of the OPEC countries now? (oops, I forgot, they’re all on the bush/neocon axis hit list already.)
heckova a job there bushie and the neocon madman.
November 19th, 2007 at 1:46 pm.
If you converted all the oil on the face of the Earth in KY-Gel it wouldn’t be enough to lube all the American asses that will be bleeding after this. Not the war, not Katrina, but this would be the legacy of Bush and the GOP.
Ya diplomacy, who needs it? This is what happens when you approach every problem by telling people to go Cheney themselves and then commence bombing. It’s incredible to act like such ass-wipes when you’re leveraged up to the teeth, have you seen our National Debt lately?
If OPEC does convert to Euros, there won’t be enough room under the mattress to hold the dollars you’ll need just for a days shopping. Combine this with our faltering infrastructure, or decimated and falling housing market, our ever shrinking manufacturing base, and lets not leave out our declining level of education.
Well, as has been said, what do you think you get when you not only put an idiot in the White House, but a party who runs on the platform of drowning government in a bathtub is a good thing. I have no issue with GOPers getting what they deserve on this one, it’s just a shame that we’ll have to suffer along with them.
Happy Thanksgiving America!
November 19th, 2007 at 1:53 pmPersonally, I hate OPEC. But in all fairness to them, this is a simple business decision. It is good business / good capitalism. And a simple exercise of their votes (while the countries involved aren’t democratic, the OPEC process has a flavor of democracy to it).
Consequently, I am in full anticipation that the wingnut pundits are applauding the move.
November 19th, 2007 at 1:58 pmRemember how the Iraqi illegal war was going to pay for itself? Remember when gas was less than $1.75/gallon? Remember how our economy was thriving back in the 1990’s? Then, the Supreme Court annointed, I mean appointed, the boy George W Bush as dictator, I mean, 43rd president of the United States. Now, 7 years later and we have this: http://money.cnn.com/2007/11/19/markets/oil.ap/index.htm?postversion=2007111912
November 19th, 2007 at 2:02 pmIf OPEC does convert to Euros, there won’t be enough room under the mattress to hold the dollars you’ll need just for a days shopping. Combine this with our faltering infrastructure, or decimated and falling housing market, our ever shrinking manufacturing base, and lets not leave out our declining level of education.
Happy Thanksgiving America!
Comment by ScrewBush
This is required reading.
All that is needed to push the US over the cliff is for 3-4 major players to convert to Euros. Look around your own town or city. Are there infrustructure problems like: potholes, bridge maintainenance, freeway repairs, school issues needing attention? They won’t get fixed.
When the demand for dollars goes down, we have to pay MORE in interest to the bond holders to recapture the investors attention (and business). As the dollar gets more unpopular, it will require even more accommodations to those creditors to secure their loans.
I can imagine a scary scenario: unable to secure the needed credit to pay for our standard of living, the US starts selling off (or offering to the creditors) assets such as national parks, oil and gas leases, ship dockyards (remember Dubai?), flight patterns, etc…It sounds crazy, but what would we do? We demand billions in credit everyweek. It has to come from somewhere. Bush’s Iraq bill is already to $1 trillion, and it is all off budget.
November 19th, 2007 at 2:07 pmI can imagine a scary scenario: unable to secure the needed credit to pay for our standard of living, the US starts selling off (or offering to the creditors) assets such as national parks, oil and gas leases, ship dockyards (remember Dubai?), flight patterns, etc…It sounds crazy, but what would we do? We demand billions in credit everyweek. It has to come from somewhere. Bush’s Iraq bill is already to $1 trillion, and it is all off budget.
Comment by StratRat
This is already happening to a large degree. It just isn’t publicized in the “liberal” media.
November 19th, 2007 at 2:18 pmYou do realize that is why we invaded Iraq right?
Saddam had started trading in euros.
November 19th, 2007 at 2:22 pmWe see more & more Canadians shopping here in MN.
It’s the first time I can recall the dollar being lower than CA currency.
Will the NYSE crash in time to save the Neoturds in the ‘08 election?
Will China call in some it’s debt just prior to the crash?
This will make Enron look like child’s play.
This is why land in Paraguay looks inviting to a ‘well known family’.
Invest in Gold. Keep a well stocked supply of daily needs. And those stocks you ‘own’? Useful for starting a fire…
November 19th, 2007 at 2:22 pmThe US is going down hill! Loosing in Iraq, despite Bush’s assertion of progress. The US constitution become just a piece of abstract paper. Civil liberties dinishing in the name os FACIST security, and the economy going down the drain… If only the american people realized that this ilegal war is beeing waged on borrowed money… but, it is the FACIST STATES OF AMERICA! HAIL BUSH!!!!
November 19th, 2007 at 2:24 pmThis is already happening to a large degree. It just isn’t publicized in the “liberal†media.
Comment by bilbobaggins
I know…Japan has purchased many, many beef ranches in the midwest, Shell oil is a huge dutch company, large bits of our hospitality industry are owned by foreign companies, etc.
In the next few decades not only will America produce very little, we will also own very little of our own country. IMHO, toll freeways will be next.
November 19th, 2007 at 2:27 pmMaybe I’ve missed it but has anyone seen postings for any/all of the big oil co’s 3rd quarter profits? I don’t recall 2nd qtr either. I sure would like to know what they are.
November 19th, 2007 at 2:32 pmI can imagine a scary scenario: unable to secure the needed credit to pay for our standard of living, the US starts selling off (or offering to the creditors) assets such as national parks, oil and gas leases, ship dockyards (remember Dubai?), flight patterns, etc…It sounds crazy, but what would we do? We demand billions in credit everyweek. It has to come from somewhere. Bush’s Iraq bill is already to $1 trillion, and it is all off budget.
Comment by StratRat — November 19, 2007 @ 2:07 pm
Ok, I have the solution…
We overvalue all these parks and oil leases and dockyards and sell them all to foreign investors who can’t really afford them and encourage them to take out variable-rate mortgages to pay for it. It’s Win-Win!!
November 19th, 2007 at 2:38 pmThis bears repeating.
You do realize that is why we invaded Iraq right?
Saddam had started trading in euros.
Comment by civil behavior — November 19, 2007 @ 2:22 pm
How many people know this little tidbit?
November 19th, 2007 at 2:39 pmHow many people know this little tidbit?
Comment by Bluedahlia — November 19, 2007 @ 2:39 pm
I’ve heard it many times, but am starting to wonder how true it is.
November 19th, 2007 at 2:47 pmYeah… bad, bad, bad…
Thank you, GOP and Herr Brusch.
You are closer and closer everyday to destroying the US.
November 19th, 2007 at 2:49 pmYou do realize that is why we invaded Iraq right?
Saddam had started trading in euros.
Comment by civil behavior — November 19, 2007 @ 2:22 pm
How many people know this little tidbit?
Comment by Bluedahlia — November 19, 2007 @ 2:39 pm
I don’t think it’s a huge state secret, but it’s been all but ignored by the MSM, so I bet most Americans are unaware of it.
I’m just shaking my head at the irony of it. We invade Iraq and punish Saddam for trading in euros instead of dollars, and by doing so, we are on our way to bankrupting ourselves and making said dollar more worthless by the day. Smart move?
November 19th, 2007 at 3:25 pm#4..His own people hanged him after we invaded his country.;-)
November 19th, 2007 at 3:29 pmOh, Yeah, by the way.
Kiss your 401k’s bye bye over the next year or so.
November 19th, 2007 at 3:44 pmKing Abdullah was not moved by the euro arguments.
“He shut down Chavez like a noisy kid in a class,” said Fadel Gheit, a senior oil analyst at Oppenheimer. “They know where the power lies, and it’s not with Chavez or” the Iranians.
Pricing oil in a currency besides dollars would also pose a technical challenge. For one, oil-producing countries peg their crude to worldwide benchmarks like the stuff that comes from Texas or England’s North Sea.
In order for OPEC to price oil in another currency, it would need to set its own price, as opposed to relying on the benchmark prices that are set in the free market – a practice the cartel has worked 20 years to avoid.
Furthermore, experts say it’s simply bad to change a system that been in place for so long.
“The dollar is like the Microsoft Windows of the oil world,” said Tertzakian. “It’s just hard to switch out of it.”
And even if OPEC did switch to another currency, some doubt whether the dollar would really take a hit.
The amount of oil OPEC sells on the world market is somewhere around half a trillion dollars a year, said Jeffrey Currie, a senior energy economist at Goldman Sachs in London. Compare that, he said, to the trillions of dollars that change hands in currency markets every day.
“You’re talking about a value that’s just too small to show up on the radar screen,” said Currie. “It isn’t enough to materially change the currency markets.”
November 19th, 2007 at 3:48 pmOh, Yeah, by the way.
Kiss your 401k’s bye bye over the next year or so.
Comment by RUCerious
November 19th, 2007 at 4:05 pmOh, Yeah, by the way.
Kiss your 401k’s bye bye over the next year or so.
Comment by RUCerious
Comment by StratRat
Sorry RUC. I had more words to this post, but they disappeared. You are correct – BTW.
November 19th, 2007 at 4:15 pmLook Here:
http: [slash] [slash] jameshowardkunstler [dot] typepad [dot] com
Read and weep!!!!
November 19th, 2007 at 7:45 pmMiss Molly and others have noted here that few people are aware that Saddam was considering trading his oil in Euros instead of dollars. An economic disaster for the US.
November 19th, 2007 at 10:30 pmAll roads lead not to Damascus, but to oil.
We went to was in Iraw for oil, plain and simple.
Ou leaders lied to us. They can claim they were bamboozled by Curveball and others; they can claim that “everyone” believed Hussein had WMD; they can say anything – and they do.
The media simply reported what they said without challenge, without question, and 5 years later we are in a quagmire we cannot escape, with nearly 4,000 dead.
We went to war for oil.
When oil is no longer traded on dollars, we are sunk. We will be financially devastated. Not just the government, but all of us.
November 19th, 2007 at 10:34 pmBush&Co had no clue, no desire, and no intention of doing anything about this potential disaster except to bomb, destroy and kill.
Any chance the U.S. would convert to the Euro?
Yeah, I know, no chance in hell, right?! I’m just curious if it would help us economically, hopefully before the dollar becomes about as worthless as the depression-era Deutschmark!
During the depression, it was said that German citizens, during the winter, would literally stuff Deutchmarks into the fireplace to start a fire. That’s how worthless it was as currency.
What kills me about Bush (among many things), is our house is falling down around us, yet all he gives a sh*t about is the war, the war, the war.
I am so ready for a fresh start in this country. I just wonder if/when it’ll ever occur. I know the majority of people in this country feel the same way. The past 8 years, we’ve had to witness the worst presidency in United States history. Enough!
November 20th, 2007 at 7:37 amComment by civil behavior — November 19, 2007 @ 2:22 pm
This bears repeating.
You do realize that is why we invaded Iraq right?
Saddam had started trading in euros.
Comment by Bluedahlia — November 19, 2007 @ 2:39 pm
How many people know this little tidbit?
People like us who get their new on the internet all know. People who get their 30 minute broadcast on the networks or Faux News, CNN or MSNBC don’t.
November 20th, 2007 at 6:17 pm