muses of the moment

April 12, 2012

Iran’s oil counter-sanctions

Filed under: Dollar Crisis, Economic Crisis, European Debt Implosion, Fiat Currency — totallygroovygirlfriday @ 1:58 pm

Click here. Iran has dropped Spain and threatens to drop Germany as oil customers.

Now, these threats may not go thru right now, as the “alternative” swift system is not set up yet in Asia. It will be a few more years until a complete cut from SWIFT will not hurt China and India. (It could hurt Russia, but Russia can turn off the natural gas supply to Europe, if necessary.) But once the new swift system and the reserve currency system that the new system will grow from is set, US will have one less financial bullet available and we will be closer to global oil valued in something besides US dollars.

China is the major player actually buying Euro debt, so I don’t see Europe (or the UN) pushing any of these issues too hard. (GG is sure they will use some of that debt as part of the new reserve fund.) Yes, China can pay the Fed’s/US dollar game, too. It all comes down to confidence in the countries backing up the system, and China and India have little debt (and therefore will not default) compared to Europe and US.

We are witnessing a major shift in global power here. Do not miss the significance of it. The power-play is around the US trying to keep the global oil trade in US dollars.

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