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Published at http://www.ratical.org/ratville Clarks article at www.ratical.org/ratville/CAH/RRiraqWar.html
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I would like to thank the
hundreds of people from all over the world that emailed me positive feedback throughout 2003
with respect to my research and Internet based essay on the war. Based on your overwhelmingly
positive feedback and my own sense of patriotic duty, I am currently writing a book
based on this research. Additionally, I am also working with a former government economist
to construct an empirical model studying the possible effects of the dollar's valuation in
response to a euro currency pricing mechanism for OPEC producers. The results of will hopefully
be included in the proposed forthcoming book, tentatively entitled: Petrodollar Warfare: For those who are already
familiar with my original pre-war essay from January and March 2003, you may want to skip
the opening parts of this essay and review the expanded section explaining the importance
of Hydrocarbons regarding Peak oil and US Geostrategy, and then review my somewhat lengthy
update from essay a year ago was an excessive
focus on the macroeconomic perspectives of the war. In this essay, and in
the forthcoming book, I have attempted to remedy this deficiency by including a detailed analysis
of the oil depletion/geostrategic aspects, which appear to be second coalescing factor
that lead to the Summary Although completely unreported
by the core reasons
for this upcoming war is this administration's goal of preventing further Organization
of the Petroleum Exporting Countries (OPEC) momentum towards the euro as
an oil transaction currency standard. However, in order to pre-empt OPEC, they need to gain geo-strategic
control of The second coalescing factor
that is driving the by respected oil geologists
and possibly this administration is the impending phenomenon known as Global
"Peak Oil." This is projected to occur around 2010, with of Peak Oil has been added
to the scope of this essay, along with the macroeconomics of `petrodollar recycling' and
the unpublicized but genuine challenge to U.S. dollar hegemony from the euro as
an alternative oil transaction currency. The author advocates graduated reform of the global
monetary system including a dollar/euro currency `trading band' with reserve
status parity, a dual OPEC oil transaction standard, and multilateral treaties via
the UN regarding energy reform. Such reforms could potentially reduce future oil currency
and oil warfare. The essay ends with a reflection and critique of current US economic and
foreign policies. What happens in the 2004 will have a large impact
on the 21st century. Revisited -- The Real Reasons
for the Upcoming War With A Macroeconomic and Geostrategic
Analysis of the Unspoken Truth "If a nation expects to be
ignorant and free, it expects what never was and never will be . . . The People cannot be safe
without information. When the press is free, and every man is able to read, all is safe." Those words by Thomas Jefferson
embody the unfortunate state of affairs that have beset our nation. As our
government prepares to go to war with unable to answer even the
most basic questions about this upcoming conflict. First, why is there a lack of a broad
international coalition for toppling Saddam? If weapons of mass destruction
(WMD) program truly possessed the threat level that President Bush has repeatedly
purported, why are our historic allies not joining a coalition to militarily disarm
Saddam? Secondly, despite over 400 unfettered U.N inspections, there has been
no evidence reported that program. Indeed, the Bush
administration's claims about demonstrably false. [1] [2]
Third, and despite President Bush's repeated claims, the CIA has not found any links between
Saddam Hussein and Al Qaeda. To the contrary, some intelligence analysts believe
it is more likely Al Qaeda might acquire an unsecured former within a destabilized Moreover, immediately following
Congress's vote on the Iraq Resolution, we suddenly became informed of processing uranium in order
to produce nuclear weapons this year. (It should be noted that just after coming into
office President Bush was informed in January 2001of North has not provided a rationale
answer as to why Saddam's seemingly dormant WMD program possesses a more
imminent threat that program. Millions of people
in the question: "Why attack one of the core drivers for
toppling Saddam is actually the euro currency, the -- . Although apparently suppressed
in the is simple yet shocking. The
upcoming war in Federal Reserve and the Bush/Cheney
administration view hydrocarbons at the geostrategic level, and the unspoken but
overarching macroeconomic threats to the dollar from the euro. The
Real Reasons for this upcoming war is this administration's goal of preventing further
OPEC momentum towards the euro as an oil transaction currency standard, and to
secure control of (predicted to occur around
2010). However, in order to pre-empt OPEC, they need to gain geo-strategic
control of essay will
discuss the macroeconomics of the `petrodollar' and the unpublicized but real threat to
currency. The following is how an individual very well versed in the nuances of macroeconomics alluded to
the unspoken truth about this upcoming war with "The Federal
Reserve's greatest nightmare is that OPEC will switch its international
transactions from a dollar standard to a euro standard. actually
made this switch in Nov. 2000 (when the euro was worth around 82 cents), and has actually
made off like a bandit considering the dollar's steady depreciation against the
euro. (Note: the dollar declined 17% against the euro in 2002.) "The real reason the Bush
administration wants a puppet government in or more importantly,
the reason why the corporate-military-industrial network conglomerate
wants a puppet government in to a dollar
standard and stay that way." (While also hoping to veto any wider
OPEC momentum
towards the euro, especially from OPEC producer
who is actively discussing a switch to euros for its oil exports)."
Although a collective switch
by OPEC would be extremely unlikely barring a major panic on the U.S. dollar,
it would appear that a gradual transition is quite plausible. Furthermore, despite increasingly
weak/threatened from massive civil unrest. Some analysts believe civil unrest might
unfold in unpopular
administration is acutely
aware of these risks. Hence, the neo-conservative framework entails a large and permanent
military presence in the Saddam era, just in case we need to surround and control Saudi's large Ghawar oil fields in the event
of a Saudi coup by an anti-western group. But first back to "Saddam
sealed his fate when he decided to switch to the euro in late 2000 (and later
converted his $10 billion reserve fund at the U.N. to euros) -- at that point, another manufactured
Gulf War become inevitable under Bush II. Only the most extreme circumstances
could possibly stop that now and I strongly doubt anything can -- short
of Saddam getting replaced with a pliant regime. "Big Picture Perspective:
Everything else aside from the reserve currency and the Saudi/Iran oil issues
(i.e. domestic political issues and international criticism) is peripheral
and of marginal consequence to this administration. Further, the dollar-euro
threat is powerful enough that they will rather risk much of the economic backlash
in the short-term to stave off the long-term dollar crash of an OPEC transaction
standard change from dollars to euros. All of this fits into the broader
Great Game that encompasses This information about administration as the truth
could potentially curtail both investor and consumer confidence, reduce consumer
borrowing/spending, create political pressure to form a new energy policy that slowly
weans us off Middle-Eastern oil, and of course stop our march towards a war with
to be effective " rebuke challenge it. But the political
message will cost RFE/RL correspondent Charles
Recknagel looks at what and lose, and the impact
of the decision to go with the European currency." [4] At the time of the switch
many analysts were surprised that Saddam was willing to give up approximately $270 million
in oil revenue for what appeared to be a political statement. However, contrary
to one of the main points of this November 2000 article, the steady depreciation of
the dollar versus the euro since late 2001 means that profited handsomely from
the switch in their reserve and transaction currencies. Indeed, The Observer surprisingly
divulged these facts in a recent article entitled: ` handsome profit by dumping
dollar for euro,' ( "A bizarre political statement
by Saddam Hussein has earned hundreds of millions of euros.
In October 2000 US Dollar -- `the currency
of the enemy' -- for the more multilateral euro." [5] Although conglomerates, this the dollar since late 2001,
which also applies to the $10 billion in food' reserve fund that was
previously held in dollars has also gained that same percent value since the switch. It
was reported in 2003 that from $10 billion dollars
to 26 billion euros. According to a former government analyst, the following scenario
would occur if OPEC made an unlikely, but sudden (collective) switch to euros,
as opposed to a gradual transition. "Otherwise, the effect of
an OPEC switch to the euro would be that oilconsuming 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 crisis, for example). You'd
have foreign funds stream out of the 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 currency. This doesn't mean that the the transition would have to be gradual to avoid such dislocations (and the ultimate result of this would probably be the in the global economy)." For the entire article go to https://newsanalysis1.tripod.com/polit/id7.html Although the above scenario
is unlikely, and most assuredly undesirable, under certain economic conditions it is
plausible. In fact, one of the conditions that could create such an environment is a near
unilateral spike in oil prices could
create huge problems for the imperiled Japanese banking system, the world's largest
holder of U.S. dollar reserves. Unfortunately the current Bush administration has chosen
a military option instead of a multilateral conference on monetary reform to resolve
these issues. In the aftermath of toppling Saddam it is clear the is no talk of an `exit strategy,'
as the military will be needed to protect the newly installed regime, and to
send a message to other OPEC producers that they too might receive `regime change' if
they convert their oil payments to euros. An interesting yet again
underreported story from last year relates to another OPEC `Axis of Evil' country, currency. " instead of U.S. dollars is
based primarily on economics, Iranian and industry sources said. "But politics are still likely
to be a factor in any decision, they said, as the opportunity to hit back
at the part of an `axis of evil.'
"The proposal, which is now
being reviewed by the Central Bank of likely to be approved if
presented to the country's parliament, a parliamentary representative said. "`There is a very good chance
MPs will agree to this idea . . . now that the euro is stronger, it is more logical,'
the parliamentary representative said." [6] Moreover, and perhaps most
telling, during 2002 the majority of reserve funds in central bank were shifted
to euros. It appears imminent they intend to switch oil payments to euros. "More than half of [ been converted to euro, a
member of the Parliament Development Commission, Mohammad Abasspour
announced. He noted that higher parity rate of euro against the
US dollar will give the Asian countries, particularly oil exporters, a chance to usher
in a new chapter in ties with European Union's member countries. "He said that the noting that given the superiority
of the dollar against other hard currencies, the US monopolizes global trade.
The lawmaker expressed hope that the competition between euro
and dollar would eliminate the monopoly in global trade." [7] After toppling Saddam, this
administration may decide that qualifies them as the next
target in the `war on terror.' euro as their currency for
oil exports is well documented. Perhaps against of the neo-conservatives.
"While still wrangling over
how to overthrow administration is already
looking for other targets. President Bush has called for the ouster of Palestinian
leader Yasir Arafat. Now some in the administration -- and allies
at D.C. think tanks -- are eyeing Aside from the geopolitical
risks regarding actually Japan. Perhaps the
biggest gamble in a protracted economy. [9] If the war creates
prolonged oil high prices ($45 per barrel over several months), or a short but massive
oil price spike ($80 to $100 per barrel), some analysts believe prices, and if its banks
default, the collapse of the second largest economy would set in motion a sequence of events
that could prove quite damaging to the There is little doubt the
military securing Nonetheless, other risks
might arise if the is possible that civil unrest
may unfold in the to prevent: another OPEC
member switching to euros as their oil transaction currency standard. Incidentally, the final `Axis
of Evil' country, drop the dollar and begin
using euros for trade, effective OPEC-producers, illustrates the geopolitical
fallout of President Bush's harsh rhetoric. Much more troubling is are in dire need of oil and
food; and in an act of desperation they have re-activated their pre-1994 nuclear program.
The re-processing uranium fuel rods appear to be taking place, and it appears their
strategy is to prompt negotiations with the and oil. The CIA estimates
that second half of 2003. Ironically,
this crisis over confirms the fraudulent premise
for which this war with Saddam was entirely contrived. During the 1990s the world
viewed the benevolent superpower. Military
actions in (1999) were undertaken with
NATO cooperation and UN involvement, thereby affording these operations
with a sufficient level of international legitimacy. President resolution to the Israeli-Palestinian
conflict. With the exception of the superpower status was viewed
as mostly benign. Our trade imbalances were tolerated, and balanced fiscal policies
provided confidence. However, in both the pre
and post 9/11 intervals, the ` administration, with its
unwillingness to honor International Treaties, along with their aggressive militarisation
of foreign policy has significantly damaged our reputation abroad. Following 9/11, it
appears that President Bush's `warmongering rhetoric' has created global tensions --
as we are now viewed as a belligerent superpower willing to apply unilateral military
force without U.N. approval. Moreover, this administrations failure to actively engage
in negotiations regarding the Israeli/Palestinian conflict is unfortunate. Lamentably,
the tremendous amount of international sympathy we witnessed in the immediate
aftermath of the September 11th tragedy has been replaced with fear and anger at our
government. This administration's bellicosity has changed the worldview, and `anti-Americanism'
is proliferating even among our closest allies. [11] Equally alarming, and completely
unreported in the shifts in the reserve funds
of foreign governments away from the dollar with movements towards the euro. [12] [13]
[14] It appears the world community may lack faith in the Bush administration's flawed
economic policies, and along with OPEC, seem poised to respond with economic retribution
if the uncontrollable and dangerous
superpower. Despite the absence of media coverage, the plausibility of slowly abandoning
the dollar standard for the euro is real. An article by Hazel Henderson outlines
the dynamics and the potential outcomes: "The most likely end to of high oil prices (brought
about by US foreign policies toward the and deeper devaluation of
the US dollar (expected by many economists). Some elements of this scenario:
1. deficits as far as the eye
can see -- combined with historically-high US trade deficits -- lead to
a further run on the dollar. This and the stock market doldrums make the
2. More developing countries
follow the lead of diversifying their currency
reserves away from dollars and balanced with euros. Such a shift
in dollar-euro holdings in 3. OPEC could act on some
of its internal discussions and decide (after concerted buying of euros
in the open market) to announce at a future meeting in even a new oil-backed currency
of their own. A sends oil to 40 (euros) per
barrel. 4. The Bush Administration's
efforts to control the domestic political agenda backfires. Damage
over the intelligence failures prior to 9/11 and warnings of imminent
new terrorist attacks precipitate a further stock market slide. 5. All efforts by Democrats
and the 57% of the policy toward renewables,
efficiency, standards, higher gas taxes, etc. are blocked by the Bush Administration
and its fossils fuel industry supporters. Thus, the price shocks. 6. The EU recognizes its
own economic and political power as the euro rises further and becomes
the world's other reserve currency. The G-8 pegs the euro and dollar
into a trading band -- removing these two powerful currencies from
speculators trading screens (a "win-win" for everyone!). Tony Blair persuades
Brits of this larger reason for the to join the euro. 7. Developing countries lacking
dollars or "hard" currencies follow directly with each other
in computerized swaps and counter trade deals. President Chavez has
inked 13 such country barter deals on its oil, e.g., with setting up clinics in rural
Venezuelan villages. The result of this scenario?
The account trade deficits or
continue to wage open-ended global war on terrorism or evil. The administration begins to
return to its multilateralist tradition, ceases its obstruction and rejoins the
UN and pursues more realistic international cooperation." [15] As for the events currently
taking place in may allude to why the Bush
administration quickly endorsed the failed military-led coup of Hugo Chavez in April 2002.
Although the coup collapsed after 2 days with Chavez being restored to power,
various reports suggest the CIA and a rather embarrassed Bush administration approved and
may have been actively involved with the civilian/military coup plotters. "George W. Bush's administration
was the failed coup's primary loser, underscoring its bankrupt
hemispheric policy. Now it is slowly filtering out that in recent months White House
officials met with key coup figures, including Carmona. Although the administration
insists that it explicitly objected to any extra-constitutional action
to remove Chavez, comments by senior officials did little to convey
this. . . . "The CIA's role in a 1971
Chilean strike could have served as the working model for generating economic
and social instability in order to topple Chavez. In the truckers' strike of
that year, the agency secretly orchestrated and financed the artificial prolongation
of a contrived work stoppage in order to economically asphyxiate the
leftist Salvador Allende government. "This scenario would have
had CIA operatives acting in liaison with the Venezuelan military, as well
as with opposition business and labor leaders, to convert a relatively minor
afternoon-long work stoppage by senior management into a nearly
successful coup de grâce." [16] Interestingly, according
to an article by Michael Ruppert, Venezuelan's ambassador Francisco Mieres-Lopez apparently
floated the idea of switching to the euro approximately one year before
the failed coup attempt. Furthermore, there is some evidence that the elected Chavez administration.
In December 2002 a Uruguayan government official exposed the ongoing covert
CIA operations in "Uruguayan EP-FA congressman
Jose Nayardi says he has information that far-reaching plan have been
put into place by the CIA and other North American intelligence agencies
to overthrow Venezuelan President Hugo Chavez Frias within the next
72 hours. . . . Nayardi says he has received
copies of top-secret communications between the Bush administration in
Washington and the government of requesting the latter's cooperation
to support white collar executives and trade union activists to `break
down levels of intransigence within the Chavez Frias administration.'" [17] power runs unfettered in
the Bush/Cheney oligarchy appear interested in privatizing Chavez's `barter deals' with
12 Latin American countries and cutting the U.S. dollar out
of the vital oil transaction currency cycle. Commodities are being traded among these
countries in exchange for reliance on fiat dollars.
If these unique oil transactions proliferate, they could create more devaluation pressure
on the dollar by removing it from its crucial `petro-recycling' role. Continuing attempts
to remove Hugo Chavez appear likely. The $503 billion trade account
deficit (5% of GDP), a $6.9 trillion dollar deficit (60% of GDP), and the recent return
to annual budget deficits in the hundreds of billions. These imbalances are exacerbated
by the Bush administration's ideologically driven tax and budget policies, which
are creating enormous deficits for the rest of this decade. These factors would significantly
devalue the currency of any other nation under the "rules of economics.' Why
is the dollar still the predominant currency despite these structural imbalances, and
why does it appear immune from our twin deficits? While many Americans assume the
strength of the U.S. dollar merely rests on our economic output (GDP), the ruling
elites understand that the dollar's strength is founded on two fundamentally unique advantages
relative to all other hard currencies. The reality is that the "safe
harbor" status of the U.S. dollar since 1945 rests on it being the international reserve
currency. Thus it has assumed the role of sole currency for global oil transactions (ie.
`petrodollar'). The dollars, which goods. These dollars become
"petro-dollars" when are then used by those nation states to purchase oil/energy from
OPEC producers (except perhaps annually from OPEC and invested
back into the assets such as the dollar's international
liquidity value. According to research by
Dr. David Spiro, in 1974 the Nixon administration negotiated assurances from proceeds in U.S. Treasury
Bills. In return the According to his book, The
Hidden Hand of American Hegemony: Petrodollar Recycling and International
Markets [18], these purchases were done in relative secrecy. These agreements created
the phenomenon known as "petrodollar recycling." In effect, global oil consumption via
OPEC provides a healthy subsidy to the Hence, the Europeans created
the euro to compete with the dollar as an alternative international reserve currency.
Obviously the E.U. would also like oil priced in euros as well, as this would reduce
or eliminate their currency risk for oil purchases. The `old rules' for valuation
of the U.S. dollar currency and economic power were based on our flexible market, free
flow of trade goods, high per worker productivity, manufacturing output/ trade
surpluses, government oversight of accounting methodologies (ie. SEC),
developed infrastructure, education system, and of course total cash flow and profitability.
Our superior military power afforded some additional confidence in the dollar.
While many of these factors remain present, over the last two decades we have diluted some
of the `safe harbor' economic fundamentals. Despite vast imbalances and structural
problems that are escalating within the 1974 the dollar as the monopoly
oil currency created `new rules'. The following excerpts from an Asia Times article
discusses the virtues of our petrodollar hegemony (or vices from the perspective of developing
nations, whose debt is denominated in dollars). "Ever since 1971, when standard (at $35 per ounce)
that had been agreed to at the Bretton Woods Conference at the end of
World War II, the dollar has been a global monetary instrument that the fiat. The dollar, now a fiat
currency, is at a 16-year trade-weighted high despite record US current-account
deficits and the status of the debtor nation. The gross domestic product (GDP)
of $9 trillion. "World trade is now a game
in which the the world produces things
that dollars can buy. The world's interlinked economies no longer trade
to capture a comparative advantage; they compete in exports to capture needed
dollars to service dollar-denominated foreign debts and to accumulate dollar
reserves to sustain the exchange value of their domestic currencies. To prevent
speculative and manipulative attacks on their currencies, the world's central
banks must acquire and hold dollar reserves in corresponding amounts to
their currencies in circulation. The higher the market pressure to devalue a particular
currency, the more dollar reserves its central bank must hold. This creates
a built-in support for a strong dollar that in turn forces the world's central
banks to acquire and hold more dollar reserves, making it stronger. This
phenomenon is known as dollar hegemony, which is created by the geopolitically
constructed peculiarity that critical commodities, most notably oil, are denominated
in dollars. Everyone accepts dollars because dollars can buy oil.
The recycling of petro-dollars is the price the has extracted from oil-producing
countries for US tolerance of the oil-exporting cartel since 1973. "By definition, dollar reserves
must be invested in US assets, creating a capitalaccounts surplus for the premium compared with emerging
markets. ". . . The Moreover, any asset, regardless
of location, that is denominated in dollars is a action and the dollar is
a fiat currency, the for free. And the more the
assets will rise. Thus a
strong-dollar policy gives the This unique geo-political
agreement with for the past 30 years, as
this arrangement has eliminated our currency risk for oil, raised the entire asset value of
all dollar denominated assets/properties, and allowed the Federal Reserve to create a truly
massive debt and credit expansion (or `credit bubble' in the view of some economists).
These structural imbalances in the sustainable as long as: 1. Nations continue to demand
and purchase oil for their energy/survival needs 2. the world's monopoly currency
for global oil transactions remains the US dollar 3. the three internationally
traded crude oil markers remain denominated in US dollars These underlying factors,
along with the `safe harbor' reputation of afforded by the dollar's
reserve currency status propelled the military hegemony in the
post-World War II period. However, the introduction of the euro is a significant new
factor, and appears to be the primary threat to hegemony. Moreover, in December
2002 ten additional countries were approved for full membership into the E.U.
Barring any surprise movements, in 2004 this will result in an aggregate E.U. GDP of $9.6
trillion and 450 million people, directly competing with the Especially interesting is
a speech given by Mr Javad Yarjani, the Head of OPEC's Petroleum Market Analysis
Department, in a visit to dealt entirely with the subject
of OPEC oil transaction currency standard with respect to both the dollar and the euro.
The following excerpts from this OPEC executive provide insights into the conditions
that would create momentum for an OPEC currency switch to the euro. Indeed, his
candid analysis warrants careful consideration given that two of the requisite variables he
outlines for the switch have taken place since this speech in Spring 2002. Articles regarding
the euro and its potential to purchase oil are discussed in the European and Asian media,
but have been completely unreported in the ". . . The question that
comes to mind is whether the euro will establish itself in world financial markets,
thus challenging the supremacy of the US dollar, and consequently trigger a change
in the dollar's dominance in oil markets. As we all know, the mighty dollar
has reigned supreme since 1945, and in the last few years has even gained more
ground with the economic dominance of the 90s, more than four-fifths
of all foreign exchange transactions, and half of all world exports, were denominated
in dollars. In addition, the accounts for about two thirds
of all official exchange reserves. The world's dependency on US dollars
to pay for trade has seen countries bound to dollar reserves, which are disproportionably
higher than output. The share of the
dollar in the denomination of world trade is also much higher than the share of
the "Having said that, it is
worthwhile to note that in the long run the euro is not at such a disadvantage versus
the dollar when one compares the relative sizes of the economies involved, especially
given the EU enlargement plans. Moreover, the Euro-zone has
a bigger share of global trade than the while the balanced, external accounts
position. One of the more compelling arguments for keeping oil pricing and
payments in dollars has been that the large importer of oil, despite
being a substantial crude producer itself. However, looking at the statistics
of crude oil exports, one notes that the Eurozone is an even larger importer
of oil and petroleum products than the ". . . From the EU's point
of view, it is clear that payments for oil shift from
the dollar to the euro, which effectively removed the currency risk. It would also
increase demand for the euro and thus help raise its value. Moreover, since
oil is such an important commodity in global trade, in term of value, if pricing
were to shift to the euro, it could provide a boost to the global acceptability of the
single currency. There is also very strong trade links between OPEC Member Countries
(MCs) and the Euro-zone, with more than 45 percent of total merchandise
imports of OPEC MCs coming from the countries of the Euro-zone,
while OPEC MCs are main suppliers of oil and crude oil products to "Of major importance to the
ultimate success of the euro, in terms of the oil pricing, will be if countries into the Euro-zone
and the region's two major oil
producers in the international crude oil benchmark,
Brent. This might create a momentum to shift the oil pricing system
to euros. . . . "In the short-term, OPEC
MCs, with possibly a few exceptions, are expected to continue to accept payment
in dollars. Nevertheless, I believe that OPEC will not discount entirely the
possibility of adopting euro pricing and payments in the future. The Organization,
like many other financial houses at present, is also assessing how the euro
will settle into its life as a new currency. The critical question for market
players is the overall value and stability of the euro, and whether other countries
within the "It is quite possible that
as the bilateral trade increases between the Middle East and the European Union,
it could be feasible to price oil in euros considering foster further ties between
these trading blocs by increasing commercial exchange, and by helping
attract much-needed European investment to the "In the long-term, perhaps
one question that comes to mind is could a dual system operate simultaneously?
Could one pricing system apply to the remain the test for the euro,
should the currency gain ground in the market of oil transactions ". . . Should the euro challenge
the dollar in strength, which essentially could include it in the denomination
of the oil bill, it could be that a system may emerge which benefits more
countries in the long-term. Perhaps with increased European integration
and a strong European economy, this may become a reality. Time may
be on your side. I wish the euro every success." [20] Based on this important speech,
momentum for OPEC to consider switching to the euro will grow once the E.U. expands
in May 2004 to 450 million people with the inclusion of 10 additional member states.
The aggregate GDP will increase from $7 trillion to $9.6 trillion. This enlarged European
Union (EU) will be an oil consuming purchasing population 33% larger than
the EU as of mid-2004. This does
not include other potential E.U./euro entrants such as the has been trading at parity
or above the dollar, and analysts predict the dollar will continue its downward trending
in 2003 relative to the euro. It appears the final two
pivotal items that would create the OPEC transition to euros will be based on (1) if and when
the and when the mounted to establish the
euro as an international reserve currency. Again, I offer the following information from
an astute individual who analyzes these international monetary matters very carefully:
"The pivotal vote will probably
be adopting the euro also would
give momentum to the Danish government's strong desire to follow suit.
Polls in pass with a comfortable margin
and Norwegian polls show a growing majority in favor of EU membership.
Indeed, with most EU economic directives
through the EEA partnership and with their strongly appreciated currency,
their accession to the euro would not only be effortless, but of great
economic benefit. "As go the Swedes, so probably
will go the Danes & Norwegians. It's the British who are the real
obstacle to building momentum for the euro as international transaction
& reserve currency. So long as the remains apart from the euro,
reducing exchange rate costs between the euro and the British pound remains
their obvious priority. British adoption (a neargiven in the long run) would mount
significant pressure toward repegging the Brent crude benchmark --
which is traded on the International Petroleum Exchange in whatsoever that I can think
of, whether or not they join the European Union. "Finally, the maneuvers toward
reducing the global dominance of the dollar are already well underway and
have only reason to accelerate so far as I can see. An OPEC pricing shift would
seem rather unlikely prior 2004 -- barring political motivations (ie. from anxious
OPEC members) or a disorderly collapse of the dollar (ie. Japanese bank
collapse due to high oil prices following a prolonged decade." In other words, beginning
around 2004-2008, from a purely economic, trade and monetary perspective, it
will become logical for some OPEC producers to transition to the euro for oil pricing.
Of course that will reduce the dollar's international demand/liquidity value, and
hurt the policy makers begin to make
difficult fiscal and monetary changes right away -- or use our massive military power
to force events upon OPEC . . . Facing these potentialities,
I hypothesize that President Bush intends to topple Saddam in 2003 in a pre-emptive
attempt to initiate massive Iraqi oil production in far excess of OPEC quotas, to reduce global
oil prices, and thereby dismantle OPEC's price controls. The end-goal of the neo-conservatives
is incredibly bold yet simple in purpose, to use the `war on terror' as the
premise to finally dissolve OPEC's decision-making process, thus ultimately preventing
the cartel's inevitable switch to pricing oil in euros. How would the Bush administration
break-up the OPEC cartel's price controls in a post Saddam exports back to the dollar
standard. Moreover, according to a Washington Post article just before the authority" in a postwar economy
is to drop the dollar. "The exact role of the authority,
when it would begin to take over government functions, and who would
be part of it are still to be determined, according to other senior administration
officials. But they did suggest that in running a postwar Iraqi economy, the
currency that bears a likeness
of President Saddam Hussein." [21] Obviously the `dollarization'
of issue, but I do not expect
that crucial "detail" to be discussed in the Following the war, with the
will undertake the necessary
steps to significantly increase production of beyond OPEC's 2 million barrel
per day quota. Analysts have predicted that raising years. Nonetheless, geostrategists
such as Henry Kissenger suggested in 1973 that the US should invade the discussed the history of
these goals in his article "The Thirty Year Itch." [22] Dr. Nayyer Ali offers a succinct analysis
of how for the providing the crucial economic
instrument to leverage and dissolve OPEC's price controls, thus fulfilling
the long sought-after goal of the neo-conservatives to disband the OPEC cartel: ". . . Despite this vast
pool of oil, proportionate to the reserve
base. Since the Gulf War, been limited by sanctions
and allowed sales under the oil for food program (by which what else can be smuggled
out. This amounts to less than 1 billion barrels per year. If investment in its oil sector
and boost output to 2.5 billion barrels per year, or about 7 million barrels a
day. "Total world oil production
is about 75 million barrels, and OPEC combined produces about 25 million
barrels. "What would be the consequences
of this? There are two obvious things. "First would be the collapse
of OPEC, whose strategy of limiting production to maximize price will have
finally reached its limit. An much oil will want to do
so, and will not allow OPEC to limit it to 2 million barrels per day. If barrels of production? No
one could afford to, and OPEC would die. This would lead to the second
major consequence, which is a collapse in the price of oil to the 10-dollar range
per barrel. The world currently uses 25 billion barrels per year, so a 15-dollar
drop will save oil-consuming nations 375 billion dollars in crude oil costs
every year. ". . . The however is a long-term outcome
that will require reconstituted into a functioning
state in which massive oil sector investment can take place." [23] The American people are oblivious
to the potential economic risks regarding the war. The Bush administration
believes that by toppling Saddam they will remove the juggernaut, thus allowing
the and dissolve the 10 remaining
countries in OPEC. However, could exacerbate tensions
within OPEC or perhaps momentum for pricing oil
in euros. This last issue is undoubtedly
a significant gamble even in the best-case scenario of a relatively quick and painless
war that topples Saddam and leaves Undoubtedly, the OPEC cartel
could feel threatened by the goal of the neo-conservatives to break-up OPEC's price
controls ($22-$28 per barrel). Perhaps the Bush administration's ambitious
goal of flooding the oil market with Iraqi crude may work, but I have doubts. Will OPEC
simply tolerate quota-busting Iraqi oil production, thus delivering to them a lesson
in self-inflicted hara-kiri (suicide)? Contrarily, OPEC could meet in euro. Although unlikely,
such a decision would mark the end of U.S. dollar hegemony, and thus the end of our precarious
economic superpower status. Again, I offer the analysis of an astute observer
regarding the colossal gamble this administration is undertaking: "One of the dirty little
secrets of today's international order is that the rest of the globe could topple the
they so choose with a concerted
abandonment of the dollar standard. This is future. "That such a course hasn't
been pursued to date bears more relation to the fact that other Westernized,
highly developed nations haven't any interest to undergo the great disruptions
which would follow -- but it could assuredly take place in the event that the
consensus view coalesces of the any sort of `rogue' nation.
In other words, if the dangers of American global hegemony are ever perceived
as a greater liability than the dangers of toppling the international order.
The Bush administration and the neo-conservative movement has set out on a
multiple-front course to ensure that this cannot take place, in brief by a
graduated assertion of military hegemony atop the existent economic hegemony."
Regrettably,
under this administration we have returned to massive deficit spending, and the lack
of strong SEC enforcement has further eroded investor confidence. Indeed, the flawed economic and tax policies
and of the Bush administration resulting in years of projected deficits may be
exacerbating the weakness of the dollar, if not outright hastening some countries
to diversify their central bank reserve funds with euros as an alternative to the dollar.
From a foreign policy perspective, the terminations of numerous international treaties and
disdain for international cooperation via the U.N. and NATO have angered even our closest
allies. In September 2002, Dr. Paul
Isbell wrote an excellent analysis regarding the quiet "tectonic shifts" underway
with respect the dollar and euro. In his essay he asked, "What can monetary relations becomes
undeniably obvious?" [24] Unfortunately, today we are witnessing this clash of
US/EU financial interests in the form of the upcoming over Saddam's switch to a
"petroeuro." Instead of leading a pre-emptive war in US should be pursuing a multilateral
treaty, perhaps mediated by the UN that establishes a dual-currency standard
for OPEC oil pricing. Synopsis It would appear that any
attempt by OPEC member states in the with either overt Under the guise of the perpetual
`war on terror' the Bush administration is manipulating the American people about
the unspoken but very real macroeconomic reasons for this upcoming war with old WMD program, or from
terrorism. This war will be over the global currency of oil. A war intended to prevent
oil from being priced in euros. Sadly, the to be ruled by fear and lies,
rather than by persuasion and truth. Will we allow our government to initiate the
dangerous `pre-emptive doctrine' by waging an unpopular war in to the in our economy due to massive
debt manipulation, unaffordable 2001 tax cuts, record levels of trade deficits,
unsustainable credit expansion, corporate accounting abuses, near zero personal savings,
record personal indebtedness, and our reliance and over consumption of Middle Eastern
oil. Regardless of whatever Dr.
Blix finds or does not find in appears that President Bush
is determined to pursue his `pre-emptive' imperialist war to secure a large portion of
the earth's remaining hydrocarbons, and ultimately use underutilized oil to destroy
the OPEC cartel. Will this gamble work? That remains to be seen. However, the history
of warfare is replete with unintended consequences. It is plausible that the aftermath
of the Al-Qaeda sponsored terrorism
against in a post-war retribution from the international
community or OPEC. The question we as Americans
must ask -- Can the nations and dictate their
oil export transaction currency? In brief, the answer is no. Will we forfeit any
pretense of practicing free-market capitalism while we enforce a military command economy
for global oil transactions? Is it morally defensible to deploy our brave but naïve
young soldiers around the globe to enforce U.S. dollar hegemony for global oil transactions
via the barrels of their guns? Will we allow imperialist conquest of the
ignoring the duplicitous
overthrowing of a democratically elected government in Latin nation state(s) because of
their sovereign choice of currency regarding their oil exports? I concur with Dr. Peter Dale
Scott's sentiments on this question: ". . . hopefully decent Americans
will protest the notion that it is appropriate to rain missiles and bombs upon
civilians of another country, who have had little or nothing to do with this
(financial) crisis of "A multilateral approach
to these core problems is the only way to proceed. The decline, less and less competitive,
and increasingly in debt. The Bush peoples' intention appears to be to
override economic realities with military ones, as if there were no risk of economic
retribution. They should be mindful of humiliating retreat from
States as a condition for
propping up the failing British pound. [25] Lastly, how can we effectively
thwart the threat of international Al Qaeda terrorism if we alienate so many of our
European allies? Paradoxically, this administration's
flawed economic policies and belligerent foreign policies may hasten the outcome
they hope to prevent -- further OPEC momentum towards the euro. Furthermore,
using unwieldy instrument for Geostrategy,
and as such it is unlikely to indefinitely thwart some OPEC members from acting
on their `internal discussions' regarding a switch to euros. Informed conjunction with their militant
Imperialist overreach is proving not only detrimental to our international stature,
but also threatens our economy and civil liberties. Thus, remaining silent is not only
misguided, but false patriotism. We must not stand silent and watch our country continue
these imperialist policies. The isolated `rogue' superpower,
relying on brute force, thereby motivating other nations to abandon the dollar standard
-- and with the mere stroke of a pen -- slay our superpower status? This need not be our fate.
When will we demand that our government begin the long and difficult journey towards
energy conservation, development of renewable energy sources, and sustained balanced
budgets to allow real deficit reduction? When will we repeal the clearly unaffordable
2001 tax cuts to facilitate a balanced fiscal budget, enforce corporate accounting
laws, and substantially reinvest in our manufacturing and export sectors to gradually
but earnestly move our economy from a trade account deficit position back into a trade
account surplus position? Indeed, over the last two
decades, the significant loss of to foreign competition has
adversely affected our ability to maintain a sustainable economy. The "New Economy"
paradigm of the 1990s has created a false `service sector economy' that simply cannot
sustain the competitive globalized economy.
Undoubtedly, we must make these and many more difficult structural changes
to our economy if we are to restore and maintain our international "safe harbor"
investment status. Furthermore, it would seem
imperative that our government begins discussions with the G7 nations to reform the
global monetary system. We must adopt our economy to accommodate the inevitable
ascendance of the euro as an alternative international reserve currency. I concur
with those enlightened economists who recommend the begin the process of convening
the next `Bretton Woods Conference.' The government should compromise
and agree to the euro becoming the next international reserve currency. A compromise
on the euro/oil issues via a multilateral treaty with a gradual phase-in of a dual-OPEC
currency transaction standard seems inevitable. It would also seem prudent to
investigate a third ` currency options to give
balance to the global monetary system. While these multilateral
reforms may lower our excessive oil consumption, force the government to engage in fiscally
responsible policies, and reduce some of our global military presence, perhaps
these adjustments could also reduce some of the animosity towards quality of our lives, and
that of our children by motivating the more energy efficient. Creating
balanced domestic fiscal polices, rebuilding alliances with the E.U./world community
and energy reform are in the long-term national security interests of the U.S. Global
Peak oil is a challenge to humanity itself, and will require an unprecedented amount of international
cooperation and coordination to overcome this history-making event. Furthermore,
global monetary reform is not only necessary, but could mitigate future armed
or economic warfare over oil, ultimately fostering a more stable, safer, and prosperous
global economy in the 21st century. Unfortunately, the proposed
multilateral conference on monetary reform and energy reform is viewed as abhorrent
to the current neoconservative movement, which is premised upon the of the neoconservative agenda
as outlined in the Project for a New American Century (PNAC) policy document illustrates
their idealistic goal is militarily and economically.
Indeed, the Bush administration's entrenched political ideology appears quite incompatible
with multilateral economic reform. The neoconservatives seem to
view compromise as antithetical. Ultimately We the People must demand a new administration.
We need responsible leaders who are willing to return to balanced budgets,
conservative fiscal policies, and to our traditions of engaging in multilateral foreign policies
while seeking broad international cooperation. Equally important, we must
bear in mind the wisdom of founding fathers like Thomas Jefferson who insisted that
a free press is vital, as it is often the only mechanism to protect democracy. The American
people are not aware of the issues outlined in this essay because the conglomerates that filter
90% of the information that flows within the U.S. Sadly, part of today's dilemma lays not
only within Congress but also a handful of elitist, imperialistoriented media conglomerates that
have failed in their Constitutional obligations to inform the People. Critical
information about the Internet, which should not
be our only source of real, unfiltered news. Finally, despite the media
reporting otherwise, the current wave of `global anti- Americanism' is not against
the American people or against American values -- but against the hypocrisy of
militant American Imperialism. I respectfully submit the current polices of the neoconservative
movement as expressed through various PNAC documents, their manipulation
of the citizenry through fear, and the application of unilateral incompatible to the very
fundamental principles that founded our nation. It has been said that the
vast majority of wars are fought over resources and economics, and even so-called "religious
wars" usually have economics or access to resources as a hidden motive. The usher in `oil currency' as
a new paradigm for warfare. However, the world community may not tolerate an imperialist
U.S. Hyper-Power that ignores International Law while using military force to conquer
sovereign nations. Indeed, the facts suggest additional oilproducing nation states will eventually
exercise their sovereign right by pricing their oil exports in euros instead
of dollars. I will reiterate the fundamental
issue facing our country -- Can the intelligence agencies control
the governments in all oil-producing nations -- as well as their oil export currencies?
In brief, the answer is no. The question becomes how many countries will we allow our
government to overthrow under the false pretext of the next "war on terror?" Additionally,
how much international "blowback" against the its citizens would such a
Geostrategy create? Likewise, if President Bush pursues an unprovoked and basically
unilateral war against him or his administration.
Their agenda is clear to the world community, but when will US patriots become cognizant
of their modus operandi? "It is the absolute right
of the State to supervise the formation of public opinion." "If you tell a lie big enough
and keep repeating it, people will eventually come to believe it." "The lie can be maintained
only for such time as the State can shield the people from the political,
economic and/or military consequences of the lie. It thus becomes vitally important
for the State to use all of its powers to repress dissent, for the truth is
the mortal enemy of the lie, and thus by extension, the truth is the greatest enemy
of the State." -- Dr. Joseph Goebbels, German
Minister of Propaganda, 1933-1945 # # # Background on Hydrocarbons
and US Geostrategy To understand US Geostrategy
one needs to have a realistic appreciation of the importance of hydrocarbons,
the phenomenon referred to as Peak Oil, and the importance of of data exist regarding oil
reserves, "political data" and "technical data." Politicians, the media, and economists use
political data, whereas governments, their intelligence agencies, and geologist use
the much more accurate, and much more guarded, technical data. One important issue
not understood by the general population is the impending geological phenomenon known
as "Peak Oil." It is extremely unfortunate that our corporate-controlled media
conglomerates do not report on the significance of global Peak Oil. It would seem the
European community is openly discussing this issue, and trying to make preparations
to reduce their overall energy consumption. Contrarily, the effort to control the worlds'
hydrocarbons -- and the oil currency. [27] The Pentagon has contemplated a "5-year, 7-war
plan." [28] Regarding Peak Oil, Michael Ruppert's controversial website offers
several articles: From the Wilderness. Although some of these articles are overwrought,
their analysis does illustrate how the expanding `war on terror' follows wherever
US Geostrategic concerns are regarding hydrocarbons reserves or pipelines ( This crucial concept of Peak
Oil was first illustrated in bell-shaped curves by geophysicist M. King Hubbert,
who in 1956 correctly predicted would peak in 1971. Each
oil field in the world follows a more or less bell-shaped curve, and the composite view of
the world's thousands of oil fields is one gigantic, ragged edged looking bell-shaped
curve. The best source of data regarding global oil production is form Petroconsultants
Inc out of of the 40,000 oil fields
in the world. It is rumored that the CIA is their biggest client, and that something in their 1995
report might have predicted global Peak Oil unless the reports by Petroconsultants
Inc. cost approx. $35,000, and non-disclosure statements are required for their rather
exclusive clientele. Undoubtedly the Bush/Cheney administration is aware of
the issues surrounding Peak Oil. Perhaps acknowledge of this issue is related to their
plans to invade by years. To date the two most authoritative
books I have reviewed regarding technical oil production data and Peak
Oil are the following; The Party's Over: Oil, War and the Fate of Industrial Societies (2003)
by Richard Heinberg [29], and Hubbert's Peak; The Impeding World Oil Shortage
(2001) by Kenneth Deffeyes [30]. Highly respected geologist Colin Campbell
has also researched this issue extensively [31]. Using Hubbert's methodology to
measure global oil production, contemporary geologists have forecast that global Peak
Oil will occur around 2010. Though veteran geologists such as Kenneth Deffeyes have now
concluded that Peak Oil will most likely occur between 2004 and 2008. The following
illustrates his sentiments: "My own opinion is that the
peak in world oil production may even occur before 2004. What happens if I am
wrong? I would be delighted to be proved wrong. It would mean that we have a
few additional years to reduce our consumption of crude oil. However, it would
take a lot of unexpectedly good news to postpone the peak to 2010. [32] The following information
will briefly discuss U.S. Geostrategic issues regarding oil reserves. Other than
the core driver of the dollar versus euro currency threat, the other issue related to the
upcoming war with geological findings regarding
the barrels of untapped oil (the
later would be comparable to base)." [33] Based on an
early feasibility study by Enron, the easiest and cheapest way to bring this oil to market
would be a pipeline from on cheap liquefied natural
gas from the but also large energy companies
such as Unocal and Halliburton. "I cannot think of a time
when we have had a region emerge as suddenly to become as strategically significant
as the Caspian." -- Former CEO of Halliburton, Dick Cheney
1998 In fact, these Caspian region
oil reserves were a central component of Vice President Cheney's energy plan released
in May 2001. According to his report, the import 90% of its oil by
2020, and thus tapping into the reserves in the region was viewed as a demand, and also reduce our
dependence on oil from the similar reasons that I believe
Tony Blair endorsed the reserves other than the the I suspect the decline in
the disconcerting to the British
government, as it is much more rapid than one would expect. Like the the invasion given that British
Petroleum (BP) has been the only non-US oil company that has received oil exploration
rights in the post-Saddam not yet ascended to the euro.
Because global oil production seems to have leveled off in 2000, Richard Heinberg recently
suggested that we might have reached a "Peak Oil Plateau." [35] The following
graph illustrates global Peak Oil. Once Peak Oil is reached,
the supply of oil/energy will begin an irreversible decline, along with a corresponding
irreversible increase in price despite growing demand from industrialized and developing
nations. Despite various claims by environmental groups, there is simply no readily
available substitute for oil regarding transportation, nor do the alternatives produce the
power output of oil. Eventually substitutes for oil may become available, but only if we
begin international cooperation on a truly unprecedented scale, and avoid "global oil warfare."
Although the records from
Vice President Cheney's spring 2001 energy meetings are still secret, there is one
individual who was present during some of those meetings and is willing to publicly discuss
Peak Oil. Mr. Matthew Simmons, who was a key advisor to the Bush Administration,
and participated on Vice President Cheney's 2001 Energy Task Force. Mr. Simmons is an
investment banker in International, handling an
investment portfolio of $56 billion. In May 2003 Mr. Simmons stated the following
at a conference for the Association of the Study of Peak Oil & Gas (ASPO) in "I think basically that now,
that peaking of oil will never be accurately predicted until after the fact. But
the event will occur, and my analysis is leaning me more by the month, the worry
that peaking is at hand; not years away. If it turns out I'm wrong, then
I'm wrong. But if I'm right, the unforeseen consequences are devastating.
But unfortunately the world has no Plan B if I'm right. The facts are too
serious to ignore. Sadly the pessimist-optimist debate started too late." [36] Regarding US Geostrategy
in Truth, [37] the Bush administration
ignored the U.N. sanctions that had been imposed upon the Taliban and entered
into negotiations with the supposedly `rogue regime' from apparently not very cooperative
based on the statements of ambassador, Mr. Naik. He
reports that the summer of 2001 if the Taliban
did not acquiesce to our demands. Fortuitous for Cheney's energy plan, Bin
Laden delivered to us military, along with the
CIA providing cash to the invasion of government was ushered in.
The pipeline project was now back on track in early 2002, well, sort of . . . After three exploratory wells
were built and analyzed, it was reported that the Caspian region holds only approximately
10 to 20 billion barrels of oil (although it does have a lot of natural gas)." [38]
The oil is also of poor quality, with high sulfur content. Subsequently, several major
companies have now dropped their plans for the pipeline citing the massive project
was no longer profitable. Unfortunately, this recent realization about the and nations has been decreased
downward by 20%. (Remaining global estimates reduced from 1.2 trillion barrels
to approx. 1.0 trillion) [39] [40]. The following graph illustrates
Global Peak Oil, sometimes referred to as the "Big Rollover." It is widely reported as
factual that billion barrels). However,
no geological surveys have been conducted in 1970s. The Russians, French,
and Chinese were eager to lease which may contain up to 200
billion barrels [39]. In January 2002 President Bush asked General Tommy Franks to construct
an invasion plan for "mushroom clouds," our prime
nemesis, Bin Laden, was skillfully replaced by the OSP into our new public enemy
#1, Saddam Hussein. For those who would like
to review how depleting hydrocarbon reserves could adversely erode our civil liberties
and democratic processes, retired U.S. Special Forces officer Stan Goff offers a sobering
analysis in his essay: "The Infinite War and Its Roots". [41] Likewise, for those who wish
to review some of the unspeakable evidence surrounding the September 11th tragedy,
Gore Vidal's controversial book, Dreaming War offers a thorough introduction. [42]
Finally, The War on Freedom: How and Why America was Attacked, methodically presents disconcerting
questions about the 9/11 tragedy and geostrategy regarding References 1. Rangwala, Glen, `Claims
and evaluations of 2003 2. FAIR Fairness & Accuracy,
`Media Advisory: Star Witness On Were Destroyed,' Barry, John, "Exclusive:
The Defector's Secrets, Newsweek, 3. Report, 4. Recknagel, Charles, " 1, 2000 5. Islam, Faisal, " 6. " 7. "Forex Fund Shifting to
Euro," 8. Gutman, Roy & Barry,
John, "Beyond looks at overhauling the
Islamic and Arab world," Newsweek, 9. Costello, Tom, " 2002 10. Gluck, Caroline, " 11. "What the World Thinks
in 2002 -- How Global Publics View: Their Lives, Their Countries, The World, Press, 12. "Euro continues to extend
its global influence," europartnership.com, 13. Garnaut, John, "US Dollar
Losing Its Position As 2002 14. " 15. Henderson, Hazel, "Beyond
Bush's Unilateralism: Another Bi-Polar World or A New Era of Win-Win?" InterPress
Service, June 2002 16. Birms, Larry & Volberding,
Alex, " Coup," Newsday, 17. " vheadline.com, 18. Spiro, David E., The
Hidden Hand of American Hegemony: Petrodollar Recycling and International Markets, 19. Liu, Henry C K, "US dollar
hegemony has got to go," Asia Times, 20. "The Choice of Currency
for the Denomination of the Oil Bill," Speech given by Javad Yarjani, Head of OPEC's Petroleum
Market Analysis Dept, on The International Role of the Euro (Invited by the
Spanish Minister of Economic Affairs during Presidency of the EU), 21. Walsh, Edward, " Post, 22. Dreyfus, Robert, "The
Thirty Year Itch,' Mother Jones Magazine, March/April 2003 23. Nayyer, Dr. Ali, " 24. Isbell, Paul, "The Shifting
Geopolitics of the Euro," Real Instituto El Cano, September 23, 2002 25. Scott, Dr. Peter Dale,
"Bush Deep Reason's for the War on the OPEC Euro Question,"
26. Project for a New American
Century (PNAC); See Rebuilding Strategy, Forces and Resources
For a New Century, September 2000 27. " 2003 28. Clark, Wesley, Waging
Modern War: Affairs (2003) 29. Heinberg, Richard, The
Party's Over: Oil, War and the Fate of Industrial Societies, New Society Publishers (2003)
30. Deffeyes, Kenneth S,
Hubbert's Peak: The Impending World Oil Shortage, University Press (2001) 31. Campbell, Colin, Founder,
The Association for the Study of Peak Oil & Gas (ASPO) 32. Dreffeyes, Hubbert's
Peak, op. cit.; See sample chapter 33. Pfeiffer, Dale Allen,
"Much the Last 24 Months Hoped
For Caspian Oil Bonanza Has Vanished With Each New Well Drilled -- Global Implications
Are Frightening," From The Wilderness, December 5, 2002 34. National Energy Policy:
Report of the National Energy Policy Development Group, whitehouse.gov, May 2001
35. Heinberg, Richard, "The
Petroleum Plateau," Muse Letter No. #135, May 2003 36. Revealing Statements
from a Bush Insider about Peak Oil and Natural Gas Depletion, From The Wilderness, Matthew
Simmons Transcript, 37. Jean Charles-Briscard
& Guillaume Dasquie, The Forbidden Truth: U.S.-Taliban Secret Oil Books (2002) m Interview: Donahue With
Jean-Charles Brisard m The French Connection -
Voice, m Three Reviews of the book
38. Ruppert, Michael, "The
Unseen Conflict -- War Plans, Backroom Deals, Leverage and Strategy -- Securing What's
Left of the Planet's Oil Is and Has Always Been the Bottom Line," From The Wilderness,
39. Ruppert, Michael, FTW
Interview: "Colin Campbell on Oil -- Perhaps the World's Foremost Expert on Oil and
the Oil Business Confirms the Ever More Apparent Reality of the Post-9-11 World,"
From The Wilderness, 40. Paul, James A, " 41. Golf, Stan, "The Infinite
War and its Roots," From The Wilderness, 42. Vidal, Gore, Dreaming
War: Blood for Oil & the Cheney-Bush Junta, Nation Books, 2002. His essay, "The Enemy
Within" was first printed in the UK Observer, October 27, 2002 43. Ahmed, Nafeez, The War
on Freedom: How and Why Addendum: Notable International
Monetary Movements (Late January 2003) After completing this essay
in mid-January 2003, I began to read about some interesting international monetary developments
and the related opinions of analysts. These recent developments warrant inclusion
as an addendum. The following two articles relate to the rapid devaluation of the
dollar in late January relative to the euro. This occurred in the week immediately preceding
President Bush's State of the Union address. Both of these articles suggest that `political overtones' to
their exchanges of dollars for euros. The following article may illustrate things to come
if President Bush continues on his present unilateral position on "The dollar remained on the
ropes on Thursday, buffeted by some hawkish remarks from the stung by a pointed signal
from assets is waning. "Oleg Vyugin, first deputy
chairman at the Russian central bank, said the bank plans to cut the share of
US dollars in its foreign exchange reserves and increase the share of other
currencies. . . . "Some analysts questioned
whether there may be political overtones to Vyugin's remarks, that could
be related to the widening rift between the and some other potential
allies about how to persuade weapons' inspectors requirements.
"Although comparison with the world's
biggest central banks, the question is, `Will other central banks follow and
what does this do to the ability of the current account deficit?'
said Marc Chandler, chief currency strategist with HSBC in "That deficit is currently
around 5% of gross domestic product and proving to be an increasingly heavy
millstone around the dollar's neck." [44] Although global currency
exchanges are notoriously volatile, it is interesting to note the following day (January 25th)
some analysts reiterated that these monetary movements may be related not only to
the current geo-political tensions, but may also indicate political motivations. Is
this perhaps a `warning shot over the bow' for the Bush administration regarding
their position on central banks illustrate
trouble for the dollar. "All of a sudden, the dollar's
supposedly slow and gradual decline isn't looking so slow, or gradual. "In fact the speed of the
dollar's slide, against the euro in particular, has taken even the most seasoned analysts
by surprise: a Dow Jones Newswires foreign exchange survey just ten
days ago showed the major currency trading banks forecasting the euro climbing
to $1.06 by the middle of February and not coming near $1.10 until the
end of the year. "Instead, the euro has leaped
to highs of around $1.0850 on Friday and has already gained 4% on the
dollar this year, leaving strategists increasingly scrambling to update their
forecasts. The Swiss franc keeps reaching fresh four-year highs, and the
dollar is on the ropes against sterling and a host of other key rivals. "Perhaps a more important
barometer of broader confidence in the Treasurys market. With
the dollar falling, gold spiking and stocks under pressure, Treasurys continue
to retain their safe haven appeal. "But there are warning signals
here, too, that are beginning to get more attention. This week, the
Russian central bank said it was lowering the asset portion of its foreign
exchange reserves -- in other words selling Treasurys -- calling the
dollar a low-yielding currency. "Analysts believe some of
the large Asian central banks -- that between them hold the lion's share of
the world's dollar reserves -- are also considering rejigging their Treasury
holdings. A U.S.-led war in accelerate that trend. "Indeed, some political analysts
believe that be having a direct impact
on holdings of the rest of the world so
opposed to war. `It's hard for me to believe that the flow of capital cannot help
but be affected by how the the world,' said Larry Greenberg,
an international economist at Ried Thunberg & "`Today if you have the be an even faster pullback
out of dollar-denominated assets,' said Joseph Quinlan, global economist
with we go to war influences the
rate of decline of the dollar' he said." [45] The day after the above article,
the UK Observer's Will Hutton wrote a forceful article against Bush's unilaterism.
This article further emphasizes the unfortunate economic imbalances of the unilaterist war or an unstable
aftermath in dollar denominated assets.
"The cast-iron multilateral support
that could underpin it economically as well as diplomatically and militarily.
The multi-lateralism Bush scorns is, in truth, an economic necessity. . . .
"On latest estimates, its
net liabilities to the rest the world are more than $2.7 trillion, nearly 30 per cent
of GDP, a scale of indebtedness associated with basket-case economies in
"Its industrial base is so
uncompetitive that it consistently imports more than it exports; its current-account
deficit, the gap between all its current foreign earnings and foreign spending,
is now a stunning 5 per cent of GDP,
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