Economics behind the American dollar and Oil
It seems I’m a bit late in discovering this, but I found an article done by Dr. Krassimir Petrov a few days ago, where he provides a lot of insight into the economics behind the US dollar and the oil industry. It is a very good read.
The most important thing you’ll find, is Petrov’s suggestion that the US didn’t attack Iraq to control the oil wells there. The reason for the attack was to make sure that oil would be traded only in US dollars in Iraq, instead of Euros like Saddam Hussein wanted. And the reason for wanting this is to keep the demand for US dollars high throughout the world, since oil can largely only be bought in US dollars. So the US keeps printing US dollars without any kind of backing, like for example gold, which means that the inflation of the US dollars keeps going up. Essentially the US is now buying oil and other valuable goods from other countries for nothing, just pieces of paper which they can just print more of as long as they want to.
So, indeed, why would you want to control the oil in Iraq, when you can just keep printing more of your own money as much as you need and buy the oil from them? Clearly, there had to be another reason for invading Iraq. And that reason, as Petrov suggests, is to make sure that Iraq would trade its oil only for US dollars to keep demand for US dollars high. This means that other countries will have to sell valueable goods to the US in exchange for worthless paper (which the US can print more of at any time), so that they are able to buy oil with it. And the US itself can buy as much oil as it wants because they control their own currency, and can print as much as they need.
And here is where it becomes more interesting. What will happen in the future is that the inflation of the US dollar will become so high, that its value, especially since it is not backed by gold, will become very low to almost worthless. The value of all the US dollars other countries got from the US, in exchange for oil and other valuable goods, will become very low to almost worthless, making them much poorer in a very short amount of time, all while the US retains and continues to benefit from the value they got in exchange. They will then just introduce their next currency, like Petrov suggests. So in this process, the US retains their wealth, while the other countries lose all the wealth that was represented by the US dollars they have.
And what is even more interesting, is that this certainly is not the first time something like this is happening. It has been happening many times throughout history. It is the standard way for people who control money to get richer, while the people who don’t continue to get poorer. For more details, check out a documentary called “The Money Masters.” I highly recommend it.
Comments
There are 0 responses. Follow any responses to this post through its comments RSS feed. You can leave a response, or trackback from your own site.