Jackass' Red Glare Upon The Petrodollar

145

For your holiday listening pleasure, Jim Willie returns for a comprehensive discussion of the petrodollar and how current events around the Arabian Peninsula are a sign of great distress for this monetary scheme.

Again, what is the "petrodollar". The idea was championed by Henry Kissinger in 1973 as a way to create ongoing demand for US dollars by maintaining the pricing of crude oil in dollars only. The effects of this were two-fold:

  1. To create constant demand for dollars...dollars which were now completely unhinged from any gold backing...and this demand would soak up any excess supply of new currency being printed in the US for military and social purposes.
  2. To force oil-exporting nations to keep their foreign currency reserves in dollars, thus creating an ongoing demand for US treasury bonds. This constant demand for bonds would help to keep interest rates...and thus the US debt service cost...unnaturally low.

As a result, any threat to this system, whether it has come from Iran, Iraq or Libya has been squashed either politically or militarily over the past 40+ years. The current flare-up of tensions between Saudi Arabia and Qatar must be viewed through this prism and that is the primary topic of this 47-minute discussion.

To that end, please be sure to review these links while you're listening:

I hope that you find this helpful and informative. Thanks for listening.

TF

Subscribe or login to read all comments.

Become member and subscribe to Turd's Vault

Contribute

Donate Shop

Get Your Subscriber Benefits

Private iTunes feed for all TF Metals Report podcasts, and access to Vault member forum discussions!

Key Economic Events Week of 10/25

10/26 10:00 ET Consumer Confidence
10/26 10:00 ET New Home Sales
10/27 8:30 ET Durable Goods
10/28 8:30 ET Q3 GDP first guess
10/29 8:30 ET Personal Income and Spending
10/29 8:30 ET Core Inflation
10/29 8:30 ET Employment Costs
10/29 9:45 ET Chicago PMI
10/29 10:00 ET UMich Consumer Sentiment
10/29 10:00 ET Five-year Inflation Expectations

Forum Discussion

randomness