Iran's Oil Bourse: A Threat to the U.S. Economy

[lovuian]

http://feeds.bignewsnetwork.com/redir.php?jid=04d222344c1ac47c&cat=3a8a80d6f705f8cc

While Iran's nuclear program has become a major focus of the international media, there are many who strongly believe that the program is only a cover for the U.S. government's true motive in a possible attack against Iran.

What some analysts posit is the real concern for the United States is Iran's plan to open its own oil exchange — the Iranian Oil Bourse (IOB) — with the alleged goal of becoming the dominant center of the Middle East's oil trade.

What makes the IOB the subject of such interest by the American government? According to rumors, which first vaulted the issue into the spotlight, the financial exchange in the aforementioned bourse will trade for oil in euros instead of the U.S. dollar. The dollar has long been the dominant currency for international oil trade.

A Threat to the U.S. Economy?
The debate over the ultimate financial impact of trading oil in euros rather than dollars is a complex one, but according to some experts such a move could lead to a huge drop in value for the American currency, potentially putting the U.S. economy in its greatest crisis since the depression era of the 1930s.

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According to the article the Iran Bourse is going into action in a few months... :nuke:

[mmonk]

1. I thought it was delayed at least until '07

I wish there was definitive timing on it. I keep getting different information.

[Oversea Visitor]

2. A healthy US dollars cannot be threaten

But a sick US dollars need protection.
Threat is from US goverments and their inability to run a good fiscal policy
US dollars will be drop as world currency
Many countries going that direction
Not just the Iran Oil Bourse

Role of US as world leaders also give it the privillege to its currency as world currency
You fuck up the world leader role you fuck up the trust of the world in you
You fuck up the currency
You fuck up the good times of a currency supported by the whole world

Now why do you all has to get a born loser as thePresident
He cant do a thing right

All this irreversible, thing change
Move along Get over it
Free ride over

Printing more money wont help US at all in the future
Spending wisely on its hard earn money only way in future.

[EVDebs]

5. The oil bourse helps devalue the dollar

and I'm all for that. Nixon did the same thing during the oil crisis of '73 and afterwards with Ford. A freefalling dollar will eventually wreck 'globalization' and, to me, that is a GOOD THING. Jobs will stay in the US and manufacturing will return to equilibrium.

Iran's nutty boy is really doing us a favor right now, so as a Great Satan, let's not disappoint the Iranians, alright ?

I'm all in favor of this PetroEuro bourse. After all, look whose sopped up most of those PetroDollars, guys like Lee Raymond of Exxon. Now that's an obscene amount of money he's lugging around.

[muriel_volestrangler]

9. Remember that a falling dollar increases the price of fuel in the US

hitting both individuals and businesses. It's not all beer and skittles when your currency drops in value.

[EVDebs]

14. The pain will be worth it. Imagine, Amory Lovin's Natural Capitalism

being "enforced" so to speak. Now you get the picture. Plus, imagine Saudi Arabia and Iran having to work at helping their own people instead of entrenced 'elites' (I could say same for the US but I'm just dreamin' !).

[Toots]

13. He cant do a thing right

He is perhaps the best for War Profiteering since his Grandfather Prescott Bush. War Profits are beyond anything that could have been imagined. Exxon Mobile had a ten billion dollar Profit in the fourth quarter. They expect that to just get better and better. Bush* Cabal is oil soaked and those incredible Profits are directly attributable to their policies of endless war. For his base "The haves and the have mores" he is doing very well.

[Sinti]

3. It is a huge threat. We have fiat money that depends on the petrodollar

for relative stability. Other countries keep American dollars in reserve to buy oil with. I thought the bourse was put off indefinitely, which could be a couple of months or a couple of years.

I actually could see some of the more corporatist Democratic legislators being willing to attack Iran if they do the bourse, in fairly good conscience. I use the term conscience VERY loosely here. They might be thinking they're protecting America (meaning the American economy and the hegemony of the dollar). It's a very scary thought.

Given our trade imbalance, if other nations like China start dumping dollars and/or calling in debts, we're up the creek, economically speaking -- farther up the creek.

[lovuian]

4. its a few months (sorry read it wrong)

"Iran's Deputy Oil Minister Mohammad Javad Assemipour, director of the IOB program, told Panorama that the oil trading center, due to open in a few months, will turn Iran into a major oil exchange point"

[Toucano]

6. The bourse is BS.

Let's look at the facts:

1. Stories about the bourse seldom if ever appear in the U.S. media.

2. The rest of the world, having a low opinion of the U.S., is inclined to believe this would-be-real reason for the coming invasion. It's so plausible, people panic and oil prices go upward.

3. Who do you suppose benefits from increasing oil prices? I think we all know the answer to that one. Add a little saber-rattling and anti-Israel comments from Iran and guess what? It goes even HIGHER.

4. China buys oil from Iran. China sells goods to the U.S. China has no desire to wreck the economy of it's fattest customer.

5. Buying oil in euros is unattractive to everyone, given the current standing of the dollar. Iran's major trading partners are Japan, China, Italy, Taiwan, Turkey, South Korea, Germany, France, UAE, and Russia. Five of those would have to buy euros to buy oil from Iran. That would mean they would have to sell more goods to the United States so their dollars would buy more euros to buy the same amount of oil. Remember, the U.S. economy, in this scenario, is in the shitter.

6. Japan and China alone hold 930 billion dollars in U.S. Treasury bonds. And their holdings have been going up, not down. I'm sure they'd just LOVE to see that lose value overnight. Add in the other Iranian trading partners and you're looking at 1.19 trillion $ invested in U.S. Treasury bonds.

7. While the rest of the world would probably like to put U.S. power in check by crushing the dollar, they're not going to do it at such an incredible cost to the global economy. Talk about cutting your nose to spite your face!


I'm not sure if this story is psych ops or just back-handed manipulation of the price of oil, but I know it's fishy.



The bottom line: As long as the United States is the largest consumer of oil, it's going to decide the terms of the oil trade. The U.S. is the world's customer and the customer is always right.

[Oversea Visitor]

7. If the customer

can pay.

[Toucano]

8. If this customer defaults, ain't nobody gonna be able to pay nothin'.

Everyone has too much invested to go around helping him default.

[Oversea Visitor]

10. Yup

if you borrow a small sum from the bank they wind you up
If you borrow a lot they beg you to repay

But once you in deep shit NO MORE FREE CASH

[Toucano]

11. Normally, quite true.

But this customer's credit line has been increasing, despite the gloomy outlook for their finding meaningful employment.

Jan. 2005, the UK held 101 billion dollars in U.S. treasury notes. January 2006, 224 billion.


Everybody's lending the drunken sailor more cash to keep his little party going!

http://www.ustreas.gov/tic/mfh.txt

[Oversea Visitor]

12. US being naughty

Now a BAD BAD boy
SO hey we spank
No more free ride
Writting on wall
Too bad bush be around for another 2 years
World not wait any more
Maybe if he get impeach US need no suffer so much
But US going to get spank

Dont need gun dont need bombs
Just watch bush destroy US economy
Only need little finger with him around
Not much to do just not want US dollars as payment for anything

[Jose Diablo]

15. With all due respect to reason and rationality

Although it's true that tanking the dollar would have adverse effects on Iran also, who said the objectives/decisions of the leaders in Iran are based on sound economic decisions.

I would submit their objectives may not be rational as to what is the economic best interests. When viewed from a perspective of being shamed by being viewed as backward, as a result of embracing Islam, our western culture based rationality can be tossed out the window.

We have to understand, that while our western based countries were worshipping trees and the serfs were giving their daughters virginity to slobs eating roasted pig meat with their hands, these people had a flourishing civilization. And now, because of our machines, our technology, we have a corner on the market of what it means to be rational?

Even here,in our country, we have religious fundementalists that would love to turn the clock back to what they view as the 'golden age'.

We need to get away from thinking we can predict and understand other cultures based on what we view as important.

These people in control, maybe they don't give one wit about international commerce, trade or wealth as we know it. I would submit, many of them would just love to shut the lights off and isolate all world parts by turning off the oil wells. And they could do it too, it's on their land.

So to say, the Iranian leaders would not try to shut down dollar oil commerce is not considering who they consider to be the great 'Santan'.

The world is not rational or based on reason. And human motives are seldom rational or based on reason. Thats not how we are. The altar of reason and rationality is based on what WE think is rational, not necessarily what IS rational.

Edit: Think about this. The global weather is changing, probably as a result of the carbon dioxide released from our burning huge quantities of petroleum. Our economic system is based on growth, the consuming of an ever growing amount of resources and profit from this growth mostly goes to a very small number of people. We eat vast quantities of meat from animals that consume grain that could be fed to humans, much more effectively to stop famine, yet we prefer being overweight to feeding the hungry in the world. We are selfish by anyones standards. And somehow, we are the guys in white hats?

Who are the more civilized in this world we have of western reason/rationality?