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The liberation of the U.S. Dollar in Iraq

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  • Robert Sterling
    Please send as far and wide as possible. Thanks, Robert Sterling Editor, The Konformist http://www.konformist.com Muckracker Report TeamLiberty.net November
    Message 1 of 1 , Jan 14, 2006
      Please send as far and wide as possible.

      Robert Sterling
      Editor, The Konformist

      Muckracker Report
      November 10th 2005

      The liberation of the U.S. Dollar in Iraq

      Oil, that bubbling crude, Black Gold, Texas Tea; no matter which
      country's buying or selling it, all oil purchases around the globe
      are made with U.S. dollars only. The greenback is the international
      currency of oil sales, all oil sales the world over. Since the
      dollar is the money needed to purchase oil, every country around the
      globe must hold U.S. dollars. By having to earn or borrow U.S.
      currency to purchase oil, the value of the dollar is artificially
      supported because of the demand for oil. Supporting the value of
      the dollar is vital to the economy of the United States.

      If the demand for the dollar overseas would diminish fifty percent,
      meaning that half of the U.S. currency floating around the globe
      would no longer be needed by foreign governments, every country and
      person holding U.S. dollars would quickly experience a fifty percent
      decrease in their monies purchasing power, or one hundred percent

      As long as the greenback reigns supreme as the international
      currency for oil purchases, catastrophic economic collapse of the
      U.S. economy will be prevented. Even as the United States national
      debt approaches $8 trillion, and despite the fact that for all
      practical purposes the federal government of the United States has
      been legally bankrupt since 1933, the U.S. dollar has survived
      depressions and recessions, bull and bear markets, inflation and
      deflation, fluctuating interest rates, and every other pressure and
      strain placed upon it. As with any other commodity, the reason the
      dollar has weathered the storms of the last seven-two years is
      directly attributed to demand.

      The currency of the United States is fiat money. Fiat money is
      paper money decreed legal tender, not backed by gold or silver.
      What that means is that any value the U.S. dollar retains in the
      United States is the result of the federal government enacting law
      that says it is legal tender. Legal tender means that the dollar
      must be accepted in the United States as payment for all debts,
      public and private. If the people living in the United States lost
      faith in the dollar and began to defy the legal tender law by only
      accepting gold coin to pay for debt, the value of the dollar would
      plummet. If the people persisted and resisted the federal
      government's certain forceful effort to make people accept the
      dollar to pay for all debts, the value of the dollar would
      completely vanish. It would not be worth the paper it's printed
      on. It would be worth-less.

      If people refused the dollar in the United States and started
      trading in gold coin, the big losers wouldn't be the people,
      although they would know hardship and lean times. It would be the
      banking cartel, the Federal Reserve, and the federal government,
      because it is the borrowing of fiat money from the Federal Reserve
      that allows the federal government to spend money it doesn't have on
      things it should not need. The Federal Reserve is sustained by
      interest paid on fiat money and the global demand for the U.S.
      dollar resulting from the dollar being the international currency of
      all oil sales. It's as simple as supply, demand, and interest

      The problem with fiat money is that it creates the welfare state.
      When money is one hundred percent backed by gold or silver,
      government cannot spend money it does not have because they cannot
      print more money unless they have the gold or silver to back it up.
      Fiat money has allowed the United States to run up a high interest,
      credit card-like debt of, as previously mentioned, $8 trillion.
      When the politicians in Washington DC need more money, they simple
      print it. For each dollar printed without any commodity like gold
      or silver supporting it, and for each printed while there exists a
      national debt, the value of all other dollars already in circulation
      depreciates. Again, it's supply and demand. When the federal
      government can manipulate the money supply simply by printing more
      money, the value of the money in the people's wallets decrease.
      This decrease in value increases the number of dollars required to
      make purchases. When this occurs, it's called inflation. Inflation
      is a hidden tax on the American people. When the politicians in
      Washington DC continue to spend borrowed money, they are in fact
      passing a humongous tax onto the people.

      So what's this have to do with the price of Texas Tea in Iraq? The
      background information explaining fiat money and the U.S. dollar is
      necessary to fully appreciate one of the reasons why I believe the
      United States invaded Iraq and why we may have little choice than to
      invade Iran. It is my contention that the War on Terror has some
      additional elements that are seldom discussed by the mainstream
      media. Some of the fight has to do with protecting the supremacy of
      the U.S. dollar as the international currency for oil sales.

      Protesters of the War in Iraq say oil is the reason we invaded that
      country. The Iraqi people that are now fighting against our troops
      say we're in their country to steal their oil. Both are wrong. The
      world's oil supply is stable, despite what big oil would like you to
      believe. Consequently, there is no need at this time to invade oil-
      producing countries to steal their oil. Remember, it's supply and
      demand. No, America is not in Iraq to steal oil. Part of the
      reason America is in Iraq is to re-establish the U.S. dollar as the
      only currency accepted to purchase Iraq's oil.

      In November 2000, Iraq stopped accepting U.S. dollars for their
      oil. Counted as a purely political move, Saddam Hussein switched
      the currency required to purchase Iraqi oil to the euro. Selling
      oil through the U.N. Oil for Food Program, Iraq converted all of its
      U.S. dollars in its U.N. account to the euro. Shortly thereafter,
      Iraq converted $10 billion in their U.N. reserve fund to the euro.
      By the end of 2000, Iraq had abandoned the U.S. dollar completely.

      Two months after the United States invaded Iraq, the Oil for Food
      Program was ended, the country's accounts were switch back to
      dollars, and oil began to be sold once again for U.S. dollars. No
      longer could the world buy oil from Iraq with the euro. Universal
      global dollar supremacy was restored. It is interesting to note
      that the latest recession that the United States endured began and
      ended within the same timeframe as when Iraq was trading oil for
      euros. Whether this is a coincidence or related, the American
      people may never know.

      Today there's a greater threat to dollar supremacy in the global oil
      market. It is Iran's goal to open their version of the New York
      Mercantile Index (NYMEX) and London's International Petroleum
      Exchange (IPE). The NYMEX and IPE are both owned by a U.S.
      consortium and operated by IntercontinentalExchange, Inc. based in
      Atlanta, GA. Both the NYMEX and IPE can be described as stock
      exchanges for oil and other natural resources – they're oil
      exchanges for the world's global oil market. Obviously, both only
      accept U.S. dollars.

      Iran is projected to launch a third oil exchange in March 2006.
      They have developed an Iranian petroeuro system for oil trade, which
      if enacted, would threaten U.S. dollar supremacy far greater than
      Iraq's euro conversion. Called the Iran Oil Bourse, an exchange
      that only accepts the euro for oil sales would mean that the entire
      world could begin purchasing oil from any oil-producing nation with
      euros instead of dollars. The Iranian plan isn't limited to
      purchasing one oil-producing country's oil with euros. Their plan
      will create a global alternative to the U.S. dollar. If opened, the
      Iran Oil Bourse will further the momentum of OPEC to create an
      alternate currency for oil purchases worldwide. China, Russia, and
      the European Union are evaluating the Iranian plan to exchange oil
      for euros, and giving the plan serious consideration.

      If these countries drop the dollar in favor of the euro and support
      the demise of the U.S. dollar as the international currency for
      global oil purchasing, America's debt will end in default, the trade
      deficit will likely double, and the dollars that we carry in our
      wallets will be worth less, much less then they are right now. In
      the simplest terms, everything will appear to cost more because the
      dollar will be worth less.

      In theory, the price of goods and services do not go up. It is
      actually the value of the dollar going down that causes economic
      insecurity and inflated prices at the cash register. Once the
      American people understand this important lesson regarding fiat
      money, change will be demanded in Washington DC.

      Whether the United States can thwart Iran's Oil Bourse without
      military intervention is debatable and remains to be seen. The
      damage done to the economic security of the United States by both
      the Democratic and Republican Parties over the last seven decades,
      their running up a staggering $8 trillion national debt, has
      weakened the dollar and placed the United States in the precarious
      position of having to find excuses to invade countries that threaten
      not America's sovereignty and way of life, but its currency.

      This strategy of backing the U.S. dollar with bullets instead of
      bullion cannot sustain itself forever. Sooner or later, the
      American people will be required to pay for their government's out
      of control spending. When that time comes, the people are going to
      pay hell trying to do what needs to be done; abolish the Federal
      Reserve Act of 1913 and 16th Amendment of the Constitution,
      eliminate the IRS and at least twelve hundred of the fifteen hundred
      agencies of the federal government while slashing the two million
      federal employee payroll by fifty percent.

      Essentially, the current grip of the two-party juggernaut in
      Washington DC needs to be broken, the current government needs to be
      abolished and returned to a constitutional republic, and finally,
      the dollar has to be returned to the gold standard once and for
      all. If the American people fail to take these specific actions
      now, it is likely that in ten years or less, the dollar will be
      replaced by the euro as legal tender in the United States, and the
      American people will be subject to direct, global taxation by the
      United Nations on behalf of the World Bank and International
      Monetary Fund.

      You can now consider yourself forewarned.

      Ed Haas is a freelance writer and author originally from Mt. Penn,
      Pennsylvania. He currently resides in beautiful Mt. Pleasant, South
      Carolina. To learn more about Ed's work, please visit
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