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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory
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To: Broken_Clock who wrote (86714)9/21/2007 3:23:49 PM
From: Lazarus_Long  Read Replies (1) of 110194
 
I can see why the Saudis and other net creditors would want to abandon the US$. At the end of WW2, the US owned the world. Europe ans Asia were broken by years of the destruction of war. The Us, while it had been at war, had ot been attacked and used the war to build its industrial capacity. It set up the World Bank and the Bank of International Settlements. The US$, being strong and seemingly unassailable, was set up as the international reserve currency- -the currency used to settle international debts. And want to buy oil? The currency you bought in had to be US$. So other countries wanted a store of dollars at hand. This allowed the US gov't to accumulate deficits that would be unthinkable for a country that actually had to pay its bills. The blessing became a mighty curse and doomed us. Need more money? Just print it. Some poor foreign sucker will ultimately be found to buy it.
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