Syria has switched to Euros [Reuters]

Captain Trips

This is pretty big news I think - especially given the skepticism of the Iran euro oil bourse (whether it's true or not).

http://today.reuters.com/news/newsArticle.aspx?type=worldNews&storyID=2006-02-13T153028Z_01_L13432231_RTRUKOC_0_US-SYRIA-US-FOREX.xml&archived=False

http://www.upi.com/InternationalIntelligence/view.php?StoryID=20060213-013206-2660r

http://www.wpherald.com/storyview.php?StoryID=20060213-021111-6328r

At the moment, only 2 articles mention it in Google news, yet I do think it is a big event for a country in the middle east to make such a move.

What do people make of it? Is this the dollar sell-off beginning (see the reports on CHina and the rumours of it trying to reduce dollar stores at the end of last year).

Especially significant in light of the progress in Germany in the past as it is now the largest exporter in the world

http://www.nationmaster.com/graph-T/eco_exp

MrPudding

There is also talk about some Oil producing nation starting to quote oil prices in Euros instead of dollars. I think the yanks are very worried about that.

MrP

Catsmokinpot

the petroeuro is coming, just hope europe doesn't spend it all on arms like america does

Meh

Does Syria even have oil? They're not in OPEC anyway.

Jimboo_Jones

I guess this bumps up the expected date of the liberation of Syria

swiss

Apparantly they do

from http://www.cia.gov/cia/publications/factbook/geos/sy.html
Oil - production: 403,800 bbl/day (2005 est.)
Oil - consumption: 240,000 bbl/day (2004 est.)
Oil - exports: 285,000 bbl/day (2004)

This could be very significant as a potential indication of a shift in the middle east away from dollars towards euros as the main trading currency. This could be very worrying for the US, and although I've never fully understood why the currency for these oil transactions is so important it does have implications for US foreign currency reserves (for example). Perhaps someone can explain?

Sponge Bob

Once Saddam started to sell his oil in Euros sanctions were no longer enough to contain him and he had to be invaded.

Zebra3

There was a lot about the effects of petrodollar recycling on one of Sky's recent Conspiracy programmes. They reckoned that the real reason for the invasion of Iraq was that Iraq started selling oil in € and this would badly hit demand for US$.

It also said that once America had occupied Iraq, the first thing it done was reverse this decision which effectively devalued Iraq's oil wealth by 17%. Sort of undermine's America's claims to be there for the good of the Iraqi people/spreading democracy/all the other ****e they come out with.

bobbyjoe

Bit long but makes more sense than anythingelse I've read.

http://www.ratical.org/ratville/CAH/RRiraqWar.html

"Otherwise, the effect of an OPEC switch to the euro would be that oil-consuming nations would have to flush dollars out of their (central bank) reserve funds and replace these with euros. The dollar would crash anywhere from 20-40% in value and the consequences would be those one could expect from any currency collapse and massive inflation (think Argentina currency crisis, for example). You'd have foreign funds stream out of the U.S. stock markets and dollar denominated assets, there'd surely be a run on the banks much like the 1930s, the current account deficit would become unserviceable, the budget deficit would go into default, and so on. Your basic 3rd world economic crisis scenario.

"The United States economy is intimately tied to the dollar's role as reserve currency. This doesn't mean that the U.S. couldn't function otherwise, but that the transition would have to be gradual to avoid such dislocations (and the ultimate result of this would probably be the U.S. and the E.U. switching roles in the global economy)."

Catsmokinpot

swiss wrote:

Apparantly they do

from http://www.cia.gov/cia/publications/factbook/geos/sy.html
Oil - production: 403,800 bbl/day (2005 est.)
Oil - consumption: 240,000 bbl/day (2004 est.)
Oil - exports: 285,000 bbl/day (2004)

This could be very significant as a potential indication of a shift in the middle east away from dollars towards euros as the main trading currency. This could be very worrying for the US, and although I've never fully understood why the currency for these oil transactions is so important it does have implications for US foreign currency reserves (for example). Perhaps someone can explain?

in basic terms the whole concept of the petro dollar is that america gets money for transactions made with the dollar, and aslong as the oil keeps flowing in dollars they can actually print out in advance, and pay back later (so its money backed up by oil instead of gold), aslong as things stay the way they are, a sort of gigantic creditcard, if it stops the creditcard is gone, and the us will get a virtual kick in the crotchal region

Kojak

The states won't like this.

Syria could be facing big sanctions because of this.

Captain Trips

Hypothetical Situation 1: This is a finger up at the US, knowing they are probably going to be "liberated".

1. There is no response by the US as Russian Federation has more parties in the Kremlin for the Tehran leaders (obviously with the Vodka out of sight) and Hamas

2. This means that other countries, maybe even Iran, sees US not responding and so does it themselves, as do maybe more countries. No big country economy like China would do it at once as it would effect so many of their trade balances.

---

Situation 2: (probably more likely)

For the past year at the big meetings like G8 or whatever have agreed that the dollar isn't as stable as it used to be given it's dropped so much against Euro and has such dependency on a single and unstable commodity, so that diversifying into more currencies would be useful, likely ending up with shared market, the globalisation and outsourcing of the reserve currency, in a manner of speaking.

If it's #2, US residents should have seen and continue to see a drop in disposable income and standard of living, as the rest of the world gets better. Proper infrastructure for transport and healthcare is useful when economies dip like that, as the old-world ones have learned (otherwise the ones in power get kicked out fast).

paddyman

http://www.dfa-fairfax.com/index2.php?option=com_content&do_pdf=1&id=86

This here is a very good read on the whole subject.

Also gives more confirmation of an iranian bourse (supposed to start this year according to the article).

It does seem very likely that the petrodollar's monopoly will be broken in the near future. China/russia have been buying more euro's lately for their central bank.Theres more and more talk of norway/uk taking up the euro. Iraq already tried to change its system but was one of the very first things the pupet goverment the amercan's setup changed. Iran has already switched to an extent that all european countries buy oil from it in euros and now syria has switched.

Do you's think we will get european leaders openly state/trying to persue a end to petrodollar monopoly and push for a petroeuro system??

It is one of the basis of how the american economy survives and would certainly be good for us in the eurozone.

ronbyrne2005

oil being quoted in euro isnt such a major thing as many seem to think,as it stands anyone selling oil in dollars now can immediately change the dollars to euros yen swiss franc or any other currency,obviously they choose to hold the dollars in dollar denominated securities or else the dollar would have fallen dramatically by now.a switch to euro quotations wouldnt be a disaster for america as they are the major consumers of oil(they consume 25%) so the price in euros would be affected by their demand for oil and the relative strength of the dollar.

daveirl

This post has been deleted.

constitutionus

well i know its only SLIGHTLY connected but i work in foreign exchange dealing in international money transfers. the currency of desire was ALWAYS dollars yet in the last year and a half EVERYONES looking for euros. i get me head eaten off me when they hear they can only receive local or dollars and ALOT of countries have made deals to receive euros instead, particularly alot of the new accession countries and their non EU neighbours.

i know its not on the same scale as the petro dollar but when the common man on the street doesnt want your currency your in trouble

Victor

daveirl wrote:

This post has been deleted.

Actually the USA maintains its own sanctions against a bunch of countries - Cuba, Iran, Syria, etc. I imagine Iraq is off the list and the Libyan sanction scheme has had some reductions.

These sanctions affect how (mostly American) business deals with those countries. From time to time, people try to impose these rules on the American assets of non-Americans. For example if you do business with Cuba, some ex-pat Cuban who was dispossed of his land in the Revolution will try to sue you (successfully or not).

amp2000

Captain Trips wrote:

This is pretty big news I think - especially given the skepticism of the Iran euro oil bourse (whether it's true or not).

http://today.reuters.com/news/newsArticle.aspx?type=worldNews&storyID=2006-02-13T153028Z_01_L13432231_RTRUKOC_0_US-SYRIA-US-FOREX.xml&archived=False

http://www.upi.com/InternationalIntelligence/view.php?StoryID=20060213-013206-2660r

http://www.wpherald.com/storyview.php?StoryID=20060213-021111-6328r

At the moment, only 2 articles mention it in Google news, yet I do think it is a big event for a country in the middle east to make such a move.
]

That should tell you the mainstream media is suppressed, you have to dig pretty deep to see whats happening.

IMO were all about to see the **** hit the fan in the next few months. The moment they strike iran things will start to go downhill rapidly for all of us. It will probably start with a run on the dollar & massive hoarding of gold, in fact the hoarding of gold already seems to be going on. Oil above $100 a barrel is a given if an attack happens, if iran succeed in shutting down the straits of hormuz, shutting in 25% of global oil supply it's game over, the entire global economy will probably crash making the 1930's depression look like a walk in the park.

I read a headline on the sunday business post yesterday saying there is no threat to the housing bubble & the economy should grow by 5% a year. I mean wtf but you would have to be a moron to believe that. I wonder if they factored in what oil at $100 a barrel does to their predictions, or whether or not they care that people will be still paying a mortgage on an apartment long after they couldnt afford natural gas to heat it, that's assuming it's actually available at high prices.
Were currently getting 85% of our natural gas from the UK who in turn get theirs from the north sea which is now in terminal decline, the UK were themselves worried about gas shortages this winter yet here in ireland we keep building apartments :rolleyes: The stupidity of some people amazes me.

It's really sad to see all this happening, we could have had a chance & at least tried to implement alternatives, but no, we squander any chance we had in favour of economic growth :mad:

Oh well, the prople who fall for headlines like that are about to get a nasty lesson in reality fairly soon if they hit iran.

Anyway, that's the end of that little rant,

Take it easy people...

constitutionus

Victor wrote:

Actually the USA maintains its own sanctions against a bunch of countries - Cuba, Iran, Syria, etc. I imagine Iraq is off the list and the Libyan sanction scheme has had some reductions.

These sanctions affect how (mostly American) business deals with those countries. From time to time, people try to impose these rules on the American assets of non-Americans. For example if you do business with Cuba, some ex-pat Cuban who was dispossed of his land in the Revolution will try to sue you (successfully or not).

didnt some us multinational buy out a swiss electronics company a few years back that made chips for intensive care equipment resulting in the cancellation of sales of said equipment to cuba because of the american embargo
i seem to remember the states getting a lot of flak from human interests groups

Snickers Man

amp2000 wrote:

That should tell you the mainstream media is suppressed, you have to dig pretty deep to see whats happening.

IMO were all about to see the **** hit the fan in the next few months. The moment they strike iran things will start to go downhill rapidly for all of us.

Oo er. Let's hope Iran gets a rudimentary nuclear capability quickly then.

If Iran has nukes,they're safe. The Americans may be a bunch of bloody fools but they're not complete idiots. They won't be able to take on Iran with all the commitments they have without help from a little more than the Brits and they won't get any help if Iran has the capability to deliver a few nuclear warheads to its neighbours or near neighbours.

Not having weapons of mass destruction caused Saddam his country.
Having weapons of mass destruction could help the Iranians save their own.

It's the MAD theory. Worked for the Cold War, it'll work for this one.

And don't worry Israel. Iran ain't going to nuke you when they know you can do the same to them with knobs on.

Vadrefjorde

Snickers Man wrote:

The Americans may be a bunch of bloody fools but they're not complete idiots.

:rolleyes:

phantom_lord

:d

Terry

Snickers Man wrote:

Oo er. Let's hope Iran gets a rudimentary nuclear capability quickly then.

If Iran has nukes,they're safe. The Americans may be a bunch of bloody fools but they're not complete idiots. They won't be able to take on Iran with all the commitments they have without help from a little more than the Brits and they won't get any help if Iran has the capability to deliver a few nuclear warheads to its neighbours or near neighbours.

Not having weapons of mass destruction caused Saddam his country.
Having weapons of mass destruction could help the Iranians save their own.

It's the MAD theory. Worked for the Cold War, it'll work for this one.

And don't worry Israel. Iran ain't going to nuke you when they know you can do the same to them with knobs on.

well said.
has anyone noticed the paranoia inherent in the american system at the moment?
does it remind anyone of mccarthyism?
or maybe this:

[FONT=verdana,arial,helvetica]The efficiency of the truly national leader consists mainly of preventing the people's attention from becoming divided, and of always concentrating it on a single enemy[/FONT]

fly_agaric

Snickers Man wrote:

Oo er. Let's hope Iran gets a rudimentary nuclear capability quickly then.

:eek:

Snickers Man wrote:

It's the MAD theory. Worked for the Cold War, it'll work for this one.

MAD assumes that the people with their fingers on the trigger are rational.

dermot_sheehan

Snickers Man wrote:

It's the MAD theory. Worked for the Cold War, it'll work for this one.

And don't worry Israel. Iran ain't going to nuke you when they know you can do the same to them with knobs on.

MAD requires more then the bomb, it requires also a means of delivering it to your enemy capable of surviving a first strike and command and control capable of surviving a first strike. Iran won't have these (would be missles capable of reaching america buried in dispersed silos or on submarines, along with bunkers and or airbourne command posts for national leadership) for the foreseable future.

With no MAD, The U.S. would be extremly tempted to launch an all out first strike with nuclear weapons that would destroy the couple of iranian bombs on the ground.