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Many readers are familiar with the original petrodollar deal the U.S made with Saudi Arabia.
It was set up by Henry Kissinger and Saudi princes in 1974 to prop up the U.S. dollar. At the time, confidence in the dollar was on shaky ground because President Nixon had ended gold convertibility of dollars in 1971.
Saudi Arabia was receiving dollars for their oil shipments, but they could no longer convert the dollars to gold at a guaranteed price directly with the U.S. Treasury. The Saudis were secretly dumping dollars and buying gold on the London market. This was putting pressure on the bullion banks receiving the dollar.
Confidence in the dollar began to crack. Henry Kissinger and Treasury Secretary William Simon worked out a plan. If the Saudis would price oil in dollars, U.S. banks would hold the dollar deposits for the Saudis.
H/t reader squodgy:
“Something to quell the froth of ignorance.”
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For what seems like decades, other countries have been tiptoeing away from their dependence on the US dollar.
China, Russia, and India have cut deals in which they agree to accept each others’ currencies for bi-lateral trade while Europe, obviously, designed the euro to be a reserve asset and international medium of exchange.
These were challenges to the dollar’s dominance, but they weren’t mortal threats.
What’s happening lately, however, is a lot more serious.
It even has an ominous-sounding name: de-dollarization. Here’s an excerpt from a much longer article by “strategic risk consultant” F. William Engdahl:
- President Maduro ‘ Venezuela will create a basket of currencies to free us from the dollar,”
- Oil traders ordered to stop accepting U.S. dollar in exchange for crude oil
- Order comes following calls from Russia and China to find alternatives to current reserve system
- U.S. Dollar accounts for two-thirds of global trade
- Venezuela has over ten-times more oil than United States
- Super powers are gradually turning to gold to avoid using world’s main reserve currency
- Are we seeing the beginning of the end for the U.S. dollar?
The oil-rich country of Venezuela has stopped accepting the U.S. Dollar as payment for oil.
Last week President Maduro warned that the country would this week ‘free’ itself from the US dollar.
“Venezuela is going to implement a new system of international payments and will create a basket of currencies to free us from the dollar,”
Continue to prepare for the (planned) greatest financial/economic collapse in world history.
Dear President Trump,
Over the last couple of years I’ve been all over TV… from Fox News to CNBC, CNN and Bloomberg. I’ve been telling our fellow Americans that the financial global elite was planning to issue their own globalist currency called special drawing rights, or SDRs.
And that those elites would use this new currency to replace the U.S. dollar as the global reserve currency.
I’ve even written about this extensively in my best-selling booksThe Road to Ruin and The New Case for Gold.
I’m sure some people in the mainstream media thought I was out of line — but the United Nations and the International Monetary Fund (IMF) have both confirmed this plan to replace the U.S. dollar is real. I’ve made this warning many times, but it seems to be falling on deaf ears. That’s why I’m writing directly to you.
Here’s the proof that the U.S. dollar is under attack, right in front of our eyes:
Venezuelan President Nicolas Maduro said Thursday that Venezuela will be looking to “free” itself from the U.S. dollar next week, Reuters reports. According to the outlet, Maduro will look to use the weakest of two official foreign exchange regimes (essentially the way Venezuela will manage its currency in relation to other currencies and the foreign exchange market), along with a basket of currencies.
According to Reuters, Maduro was referring to Venezuela’s current official exchange rate, known as DICOM, in which the dollar can be exchanged for 3,345 bolivars. At the strongest official rate, one dollar buys only 10 bolivars, which may be one of the reasons why Maduro wants to opt for some of the weaker exchange rates.
“Venezuela is going to implement a new system of international payments and will create a basket of currencies to free us from the dollar,” Maduro said in a multi-hour address to a new legislative “superbody.” He reportedly did not provide details of this new proposal.
Putin reveals ‘fair multipolar world’ concept in which oil contracts could bypass the US dollar and be traded with oil, yuan and gold…
The annual BRICS summit in Xiamen – where President Xi Jinping was once mayor – could not intervene in a more incandescent geopolitical context.
Once again, it’s essential to keep in mind that the current core of BRICS is “RC”; the Russia-China strategic partnership. So in the Korean peninsula chessboard, RC context – with both nations sharing borders with the DPRK – is primordial.
Beijing has imposed a definitive veto on war – of which the Pentagon is very much aware.
The United States’ ability to maintain its influence over the rest of the world has been slowly diminishing. Since the petrodollar was established in 1971, U.S. currency has monopolized international trade through oil deals with the Organization of the Petroleum Exporting Countries (OPEC) and continuous military interventions. There is, however, growing opposition to the American standard, and it gained more support recently when several Gulf states suddenly blockaded Qatar, which they accused of funding terrorism.
H/t reader squodgy:
“Things are really getting over-heated.”
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As I’ve said here:
“If his webbot was unable to detect that Trump, just like Killary Rotten Clinton, is a Rothschild puppet, then it is (almost) completely worthless in predicting anything.”
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Following President Donald Trump’s ban on travelers from seven predominantly Muslim countries, the Iranian government announced it would stop using the U.S. dollar “as its currency of choice in its financial and foreign exchange reports,” the local Financial Tribunereported.
Iran governor Valiollah Seif’s central bank announced the decision in a television interview on January 29. The change will take effect on March 21, and it will impact all official financial and foreign exchange reports.
“Iran’s difficulties [in dealing] with the dollar,” Seif said, “were in place from the time of the primary sanctions and this trend is continuing,” but when it comes to other currencies, he added, “we face no limitations.”
In a piece published by Forbes, Dominic Dudley contends that this move is significant “in the light of the recent ‘Muslim ban‘” announced by Trump. Iran nationals were added to the order issued by the current U.S. administration, which prompted the Iranian government to vow to stop issuing visas to U.S. citizens.