StreetScooby

You're starting to sound like Richard Nixon. Central Banks have a critical role that few in this forum seem to understand. Then, there is the Bank For International Settlements on top of the Central Banks www.bis.org We are all engines of karma

Just make sure he has a better definition of "sexual relations" this time, will ya'? We are all engines of karma

We are all engines of karma

SURPRISE, SURPRISE! We are all engines of karma

I don't know what that is. We are all engines of karma

You have to walk there? You're not listening. I have gone to great lengths to make sure that my last few replies have specifically dealt with Euro based transactions on the world markets. It doesn't matter what the other side (oil, sugar, etc.) is. All FX based transactions in the Western world are cleared through Central Banks. There is no reason for the US to take military action against a country that trades oil in Euros. Did you hear me? I noticed you haven't made any reply to "Is it your turn to learn something?" We are all engines of karma

What, you don't have access to WSJ? You want me to type the article in? Ain't happening. It's your turn to use your resources. It is what it is. We are not discussing the war in Iraq. We're discussing the free flow of oil in a free market system. And, I've even let you expand the discussion to Euro based oil trading. At this point in time, you and I are NOT discussing the war in Iraq. As previously discussed, that was not a dominant factor in our decision to invade Iraq. We've already agreed to disagree on this point. Why invade when you can stop financial transactions at the Central Bank? Do you know what a Central Bank is? We are all engines of karma

Indeed. The article had nothing to do with Cuba buying oil in Euros. The article had everything to do with Euro based transactions. If we can shut down "sugar transactions", we sure as hell can shut down oil transactions, if we want to. Is it your turn to learn something, yet? If we can shut transactions down via Central Banks, why bother to invade? BTW - did you read the article, yet? We are all engines of karma

You're wrong. FX transactions ALWAYS flow through Central Banks. I take it you didn't read the article. We are all engines of karma

Just came back from a nice night out with old friends in NYC tonight. Grabbed a Wall Street Journal to read on the train ride back to my town. On page A6, 7-Nov-2006, there is a short blurb on "Embassies Try Euros As US Restricts Use Of Dollars in Cuba". My point - we don't need to use military intervention to prevent Euro based transactions. Check out the article. Unfortunately, the link to the article isn't a freebie. We are all engines of karma

I don't know, but I think Bush believed the people around him claiming that Saddam was a clear and present danger to the US. Personally, I wish he would have listened to Colin Powell rather than Rumsfeld and Cheney. Again, we'll have to agree to disagree on this point. I'm not disputing that OPEC trading oil in non-USD currency would provide short term negative stimulus to our economy. They are free to do so. My understanding is you're claiming they won't because of fear of US military intervention. I disagree with that view. Is no one else on the planet trading oil in Euros? If there are other people trading oil in Euros, why haven't we invaded them? We are all engines of karma

Anything that impacts our effective interest rate is of great concern to us. China dumping all of its govt bonds on the open market is a real concern right now, though they'll ending up hurting themselves if they move too fast. I may be missing something here, but saying that FX currency markets will have a dramatic long term impact on US based securities isn't something I've heard or read about. We are all engines of karma

It already is becoming a problem for US govt bond markets. The Chinese are taking steps to minimize their exposure to this security. The net impact may well be an increase in our country's interest rates. We are all engines of karma

Sure, I've learned some things in this thread that I didn't know prior to getting involved in it. That's one of the things I love about SC. I don't agree with the statement that we'll use military intervention to keep a country from trading oil in Euros. The financial markets are very deep, and we would deal with that situation via free markets, if it does arise. We are all engines of karma

As I have said several times now in this thread, it's about the free flow of oil in a free market system. The US has never invaded another country because that country wanted to trade oil in Euros. During the 1970s, OPEC had no qualms what so ever putting the screws to our economy. And they did it in a much more effective way than trading oil in a non-USD currency. Our military advantage over their countries was as great then as it is now. I expect that their lack of support for the war would have been the same had oil been trading in Euros. We are all engines of karma

Based upon the arguments being made in this thread, I don't doubt we have an interest in keeping demand for the USDollar high. I very much doubt the "threat" of Euro based oil trading is so high as to provoke military action on our part. Until I see further evidence, this may be a point we have to agree to disagree on. When did they switch back? After we invaded, or before? So, there wasn't military intervention. Chavez is a loose cannon. Why isn't he only taking payments in Euros? He's clearly not afraid of US military intervention. We are all engines of karma

We didn't do it because we wanted their oil. That's my point. There's nothing stopping countries from trading dollars in Euros. If the suppliers will only accept Euros, then that is there perogative. We are all engines of karma

What's wrong with letting the cap sleep on your bed? A happy kitty is better than an unhappy kitty. We are all engines of karma

We'll have to agree to disagree on this point. What you're calling a fact is something I see as an opinion. While old-traded-in-dollars may be a concern to some of our leaders, the fact is we aren't going around conquering countries and claiming their resources as our government's own. So, what happens when the world's gold supply runs out before the oil supply. Oil suppliers will have all the gold. Does that mean they'll stop selling their oil to non-gold owners? I doubt it. Gold backed currencies do not make sense in our world today. That's why every Central Bank in the world has moved away from it. If the value of the dollar is adversely affected, then USD denominated securities will be adversely affected. That we're in agreement on. The question is - what will it take for the USDollar to be negatively impacted for a prolonged period of time? If there's a surplus in USD on the world market, the Fed will absorb those dollars, thus negating the increase in supply. As SkyDekker notes in a later reply, he thinks that won't be enough to correct the price relative to other currencies. I don't know. Great Britain did not collapse when the world started using dollars over pounds. We are all engines of karma

There aren't any holidays in that, though! We are all engines of karma

I would love to see that. We are all engines of karma

Interesting article on the IMF. Thanks for posting it. We are all engines of karma

In order to reply to him, I read his profile. My quote to him follows: *** The world markets are much deeper than your reply connotes. It wasn't meant to be demeaning or a personal attack, it was meant to underscore that there's alot more going on in the world than many may realize. The world's financial markets are very deep. We are all engines of karma

Agreed. Unfortunately, our current leadership is not going to push that hard. Bush, Cheney, et. al., have well documented conflicts of interests in this area. We are all engines of karma

No, I don't see it as justification for wars. I believe Rumsfeld is incompetent, and Cheney is the prince of darkness. Agreed. Start building more nuclear reactors is one idea. Move to crop based ethanol for combustion engines (...I'm not sure how practical that is). Fund a Manhattan type project to create cost effective energy alternatives (per Tom Friedman). We are all engines of karma