Oil Barrens don’t think the US is healthy…
By Daniel at 20 December, 2009, 11:08 am
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Saudi Arabia to U.S. Dollar: Drop Dead
By Christian A. DeHaemer | Friday, December 18th, 2009
With the global warming lobbyists fighting the snow in Copenhagen, a small, unheralded piece of news popped up on my newsfeed.
It seems that while the green lobbyists were drinking scotch and counting the money soon to be made from carbon credits, the Arabs were driving another nail into the U.S. economy. The Gulf states are ditching the dollar.
End of an Era
You see, the Saudis are sick of it. The price of oil has been bouncing around between $12 a barrel in 2000… to $147 in 2008… to $38 in at the start of 2009…
…In answer to these problems, the Gulf states announced this week that they have formed their own monetary council based on the euro model.
According to the UK’s Telegraph:
The Gulf monetary union pact has come into effect, the move will give the hyper-rich club of oil exporters a petro-currency of their own, greatly increasing their influence in the global exchange and capital markets and potentially displacing the US dollar as the pricing currency for oil contracts. Between them they amount to regional superpower with a GDP of $1.2 trillion (£739bn), some 40pc of the world’s proven oil reserves, and financial clout equal to that of China.
Saudi Arabia, Kuwait, Bahrain, and Qatar are to launch the first phase next year, creating a Gulf Monetary Council that will evolve quickly into a full-fledged central bank.
This is the biggest news I’ve heard in at least a month, and I’ve seen very little reporting on it in the U.S.
Here is the money quote: “The U.S. dollar has failed. We need to de-link,” said Nahed Taher, chief executive of Bahrain’s Gulf One Investment Bank.
Oil and Gold….Gold and oil.
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