It makes little sense to price all oil in usd, when the US consumes only one-quarter of it .... by going along with this use of usd, all the Rest of Us are subsidising the US economy, and fairly directly US military power, since the ability of the US Fed to print little green banknotes, or actually for the most part electronic representations of little green banknotes, and trade them for real goods and services, is a one-way ponzi scheme really ..... which means it'll work fine, until the Rest of Us lose confidence in its value, then poof, no more seigneurage effect, the flow reverses - and in exchange for what, you have to wonder
Yes, when you consider the pent up growth and demand in the Indian, Chinese and Russian economies, and then factor in the European Union and Japan, what does the US have to offer other than little green colored pieces of paper?...not sure I am ready to buy into gold yet as it would be too restrictive on economic growth at a price where it could used as some form of a "global currency reserve" instead of a commodity for electronics, jewelry and dentistry.
At any rate, if Iran has already moved to pricing oil in Euro's, Yen, Pounds and Rubbles, the move to marginalize the you-es-eh and liberate and up lift the economies of the rest of the world has already begun. Owning hard commodities or their proxies seems like a good strategy. The only downside is the yankees will interpret it all as an act of (economic)war and they don't like to be on the receiving end. |
