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The Petrodollar Regime is Crumbling!

serfserf Member Posts: 8,876 ✭✭✭✭
edited June 2017 in Politics
Well you can bet the US as a reserve currency is not too far behind.

serf

http://mironline.ca/petrodollar-regime-crumbling-will-u-s-economy-react/

Furthermore, the agreement alleviated economic pressures that could have resulted from the U.S.?s departure from the gold standard in 1971 under Nixon?s presidency. Fear of hyperinflation was widespread by the late 1960s as the U.S. Treasury found itself strapped for gold, and the future of the USD?s role as the global currency under the Bretton Woods system was in jeopardy. The Petrodollar agreement helped to re-legitimize the USD as the global currency as it pegged dollars to oil, replacing the gold standard. Also to the benefit of the USD, energy-dense oil, unlike gold, holds inherent value for an economy as an energy stock, and the value of oil sitting beneath the sands of the Arabian Gulf is seemingly endless.

Moreover, Saudi purchases of U.S. treasuries with its oil profits ensures a reliable monetary inflow for the U.S., funded by the largest supplier of the largest economic sector in the globe, the energy sector.

https://www.thebalance.com/u-s-debt-to-china-how-much-does-it-own-3306355


As you can see, if you add up the debt held by Social Security and all the retirement and pension funds, nearly half of the U.S. Treasury debt is held in trust for your retirement. If the United States defaults on its debt, foreign investors would be angry, but current and future retirees would be hurt the most.
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Yep their goes THE TRUST FUND down the drain! If you add in hyper inflation it's even worst! Equals The NWO for America,military and all to The Unite Nation enforcement.

I sincerely believe... that banking establishments are more dangerous than standing armies. Thomas Jefferson

Comments

  • Don McManusDon McManus Member Posts: 22,938 ✭✭✭✭
    edited November -1
    From your first link:

    'A net energy-exporting future for the U.S. will replace the monetary inflow from Saudi?s U.S. treasury investments of its oil profits, as well as prop up a healthy demand for USD that will help to maintain the stability of the currency. A strong domestic energy sector will also alleviate U.S. concerns over energy security, as it will no longer be reliant on energy imports. These mechanisms will mediate a smooth transition away from the petrodollar regime as well as an end to the economically-driven diplomatic ties between Saudi Arabia and the U.S.'

    I guess I am missing how this is going to support a replacement of the US Dollar as the global reserve currency.

    Regarding your second link, I am reminded of the old adage: 'If you owe the bank $ 1 million, it owns you. If you owe the bank $ 100 million, you own it. China owns US Debt in the form of Treasuries. It cannot 'call in its debt'. It can dump those treasuries on the market which will drive down their value, but this would be a buying opportunity for the debtor to grab up a portion of its outstanding debt for pennies on the dollar. There would be a short term uptick in the interest rate the US has to pay on new borrowing, but if properly played, the long term results would be a reduction in US debt and China losing a large chunk of change.
    Freedom and a submissive populace cannot co-exist.

    Brad Steele
  • serfserf Member Posts: 8,876 ✭✭✭✭
    edited November -1
    quote:Originally posted by Don McManus
    From your first link:

    'A net energy-exporting future for the U.S. will replace the monetary inflow from Saudi?s U.S. treasury investments of its oil profits, as well as prop up a healthy demand for USD that will help to maintain the stability of the currency. A strong domestic energy sector will also alleviate U.S. concerns over energy security, as it will no longer be reliant on energy imports. These mechanisms will mediate a smooth transition away from the petrodollar regime as well as an end to the economically-driven diplomatic ties between Saudi Arabia and the U.S.'

    I guess I am missing how this is going to support a replacement of the US Dollar as the global reserve currency.

    Regarding your second link, I am reminded of the old adage: 'If you owe the bank $ 1 million, it owns you. If you owe the bank $ 100 million, you own it. China owns US Debt in the form of Treasuries. It cannot 'call in its debt'. It can dump those treasuries on the market which will drive down their value, but this would be a buying opportunity for the debtor to grab up a portion of its outstanding debt for pennies on the dollar. There would be a short term uptick in the interest rate the US has to pay on new borrowing, but if properly played, the long term results would be a reduction in US debt and China losing a large chunk of change.


    It's the big trading money with SDR's that you might want to consider and The central banks swapping them. If the dollar gets devalued then I imagine the SDR's ratio for the dollar will change to make up the loss in new business. The Chinese can sell elsewhere where the currency is strong and a two tier system works well when you bet right with derivatives.

    serf

    http://www.cepii.fr/PDF_PUB/pb/2014/pb2014-05.pdf
    https://www.imf.org/external/np/fin/data/rms_five.aspx
  • Don McManusDon McManus Member Posts: 22,938 ✭✭✭✭
    edited November -1
    quote:Originally posted by serf
    quote:Originally posted by Don McManus
    From your first link:

    'A net energy-exporting future for the U.S. will replace the monetary inflow from Saudi?s U.S. treasury investments of its oil profits, as well as prop up a healthy demand for USD that will help to maintain the stability of the currency. A strong domestic energy sector will also alleviate U.S. concerns over energy security, as it will no longer be reliant on energy imports. These mechanisms will mediate a smooth transition away from the petrodollar regime as well as an end to the economically-driven diplomatic ties between Saudi Arabia and the U.S.'

    I guess I am missing how this is going to support a replacement of the US Dollar as the global reserve currency.

    Regarding your second link, I am reminded of the old adage: 'If you owe the bank $ 1 million, it owns you. If you owe the bank $ 100 million, you own it. China owns US Debt in the form of Treasuries. It cannot 'call in its debt'. It can dump those treasuries on the market which will drive down their value, but this would be a buying opportunity for the debtor to grab up a portion of its outstanding debt for pennies on the dollar. There would be a short term uptick in the interest rate the US has to pay on new borrowing, but if properly played, the long term results would be a reduction in US debt and China losing a large chunk of change.


    It's the big trading money with SDR's that you might want to consider and The central banks swapping them. If the dollar gets devalued then I imagine the SDR's ratio for the dollar will change to make up the loss in new business. The Chinese can sell elsewhere where the currency is strong and a two tier system works well when you bet right with derivatives.

    serf

    http://www.cepii.fr/PDF_PUB/pb/2014/pb2014-05.pdf
    https://www.imf.org/external/np/fin/data/rms_five.aspx


    The weighted value of the dollar as a portion of an SDR changes daily with the value of the dollar relative to the other basket currencies. In 2020 the number of dollars per SDR my change, but that will be a reflection primarily of the growth in the Chinese economy assuming it significantly outperforms the US economy.

    Either way, the changing energy market, with US imports dropping not only in volume, but in value per unit, strengthens the dollar.

    IMO, the transitioning of the planet away from the dollar as the reserve currency will remain a very slow process, primarily because even though the dollar is obviously manipulated, it is done in a fairly transparent way.

    The sky ain't falling just yet, though anyone who takes a serious look outside can tell there is not a damn thing holding it up.
    Freedom and a submissive populace cannot co-exist.

    Brad Steele
  • serfserf Member Posts: 8,876 ✭✭✭✭
    edited November -1
    The only thing holding the dollar up is The technological advances in our military establishment.

    The Roman empire model has changed however with nuclear weapons and if one just gets through and weakens The US there are plenty others friends and foes alike that would wish to fill the void with or without The United Nations as the new leader of The NWO.

    The world cartel network of big money is second in line when the Military elite start calling the shots. Only the victor reaps the spoils of war. The Commander in Chief has many contenders in the catbird seat.

    serf
  • Don McManusDon McManus Member Posts: 22,938 ✭✭✭✭
    edited November -1
    Military spending is comparatively large when looking at other countries, but small compared to our economy.

    The US economy of approximately $ 18 trillion is over 20% of the world total GDP. The value of the dollar is supported by a $ 2 trillion coal industry, oil production approaching $ 1.8 trillion, steel and other metals, agriculture, etc.

    The underpinnings of the US Economy are strong and we have a fairly unique balance of extractive, manufacturing and service industries when compared to other major economies.

    Obviously military expenditures and exports are a significant part of this, but it is a far cry from what is holding it up.
    Freedom and a submissive populace cannot co-exist.

    Brad Steele
  • serfserf Member Posts: 8,876 ✭✭✭✭
    edited November -1
    quote:Originally posted by Don McManus
    Military spending is comparatively large when looking at other countries, but small compared to our economy.

    The US economy of approximately $ 18 trillion is over 20% of the world total GDP. The value of the dollar is supported by a $ 2 trillion coal industry, oil production approaching $ 1.8 trillion, steel and other metals, agriculture, etc.

    The underpinnings of the US Economy are strong and we have a fairly unique balance of extractive, manufacturing and service industries when compared to other major economies.

    Obviously military expenditures and exports are a significant part of this, but it is a far cry from what is holding it up.



    You forgot about Imperialism and The WW I model in your calculations.Just because The United Nations forbids it doesn't mean it could not return in WW III. Possession is 9/10's of the law. America is overdue for a taste of it's own medicine.

    Foreign powers would love to give The USA a History lesson if they could've or would've and discount they shouldn't [:D]

    serf

    Historically, monopoly capitalism and imperialism made it impossible for underdeveloped countries to follow the traditional path of capitalist development. The large monopolistic capitalists of leading capitalist countries sought to eliminate competition. Since investment in development of a country might lead to potential competition, these large monopoly capitalists lost interest in developmental investment. Therefore investment went into exploitation of natural resources to be used as raw materials in the industrially advanced countries. Consequently these underdeveloped countries? economies became one-sided, raw material and food exporting economies.
  • spasmcreekspasmcreek Member Posts: 38,925
    edited November -1
    do NOT want anyone screwing with my retirement...worked to long and hard to get here and cannot do that again
  • gunnut505gunnut505 Member Posts: 10,290
    edited November -1
    Whatever, I'm celebrating the FIFTH STRAIGHT YEAR of US oil/gas production leading the World.
  • droptopdroptop Member Posts: 8,925
    edited November -1
    quote:Originally posted by gunnut505
    Whatever, I'm celebrating the FIFTH STRAIGHT YEAR of US oil/gas production leading the World.


    Don't forget coal, it's back, despite what you might have heard. Trump has created 50,000 new jobs in Coal and Mining and more are coming.

    They said he couldn't do it, impossible, maybe "stop losing jobs".
    https://www.youtube.com/watch?v=rnc0MVOQkpw

    OH NO, Trumps done it again !!!!
    http://video.foxbusiness.com/v/5462776620001/?#sp=show-clips

    Fake News Reporters and pundits need to find new work. Something simple like twiddling their thumbs in one direction.
  • CaptplaidCaptplaid Member Posts: 20,266 ✭✭✭
    edited November -1
    We can't drill our way out of this...... Barack Hussain Obama.

    Really Americans never say we can't do anything.
  • spasmcreekspasmcreek Member Posts: 38,925
    edited November -1
    we are snoozing?? while china spends trillions rebuilding the od Silk Road and other trade routes worldwide.....we can't get past the petty political infighting while china plans and builds for down the road economic/ political/ military supremacy
  • serfserf Member Posts: 8,876 ✭✭✭✭
    edited November -1
    quote:Originally posted by spasmcreek
    we are snoozing?? while china spends trillions rebuilding the od Silk Road and other trade routes worldwide.....we can't get past the petty political infighting while china plans and builds for down the road economic/ political/ military supremacy


    China is coming with transportation manufacturing here soon,Already happening in California. The only hitch is they can own 100% of the company here and make all the parts in China and ship them to assemble them here! What a joke!

    American politicians have sold us out totally to The Red Chinese! American is nothing now to we the people and economically dead to hire real Americans with good paying jobs!

    Robots with A.I. are taking all the manufacturing jobs over soon!

    They The Red Chinese run The Panama Canal canal zone now too! Wake up! The NWO is taking over.

    serf
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