How The Petrodollar Quietly Died, And Nobody Noticed

How The Petrodollar Quietly Died, And Nobody Noticed (ZeroHedge, Nov 3, 2014):

The Petrodollar, long serving as the US leverage to encourage and facilitate USD recycling, and a steady reinvestment in US-denominated assets by the Oil exporting nations, and thus a means to steadily increase the nominal price of all USD-priced assets, just drove itself into irrelevance. A consequence of this year’s dramatic drop in oil prices, the shift is likely to cause global market liquidity to fall.  This decline follows years of windfalls for oil exporters such as Russia, Angola, Saudi Arabia and Nigeria. Much of that money found its way into financial markets, helping to boost asset prices and keep the cost of borrowing down, through so-called petrodollar recycling. But no more: “this year the oil producers will effectively import capital amounting to $7.6 billion.

1 thought on “How The Petrodollar Quietly Died, And Nobody Noticed

  1. Ironic they have been watching it for two years, I have been for four……..four years this month, when China and Russia adopted Hugo Chavez’s Sucre system that took in members, and allowed member nations to trade with each other using their own currencies, leaving the dollar out. The Sucre was the world’s first electronic currency that translates the value of each member’s currency, making the need for any world reserve currency obsolete. From that date until now, I have watched the demise of the US dollar.
    In January of 2010, the US dollar was used to conclude all international trades. The first break was by Hugo Chavez’s South American Trade Alliance in late Spring of 2010. They were so small, they flew under US radar. Next, in November, 2010, China and Russia set up their own trade alliance with each other, using their own currencies, leaving the dollar out. China went on to recruit Turkey, Iran and other middle eastern nations. Africa, most emerging nations, including South Africa came aboard. Central and South America, India, Japan (although given a pass by the US)……..now only 33% use the dollar. That is largely comprised of the EU.
    When EU members break with the system, and go with BRICS or the Eurasian Union, the dollar will collapse.
    Forget the charts, it is self evident.

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