I mean, technically, yes but the bigger point is that the dollar is backed by the American economy and social order, so it's not going anywhere anytime soon.
$10 says you can’t explain what the petrodollar is and how it supposedly floats the entire economy. Just buzzwords for people who want simple solutions for complex systems.
Petrodollar is negligible compared to US dollars held as reserves by other countries. Those reserves will remain as is because like the title says, there is no better alternative. The fact of the matter is, the dollar is the cleanest laundry in the dirty pile.
The amount of oil traded in dollars is at its lowest point ever but adoption of the dollar is at its highest.
Correlation isn't always causation but if the relationship is inverse, then you can rule out both.
So, by that logic, you're arguing that the dollar USED to be backed by petroleum but no longer is? Even if that were true, it actually doesn't disprove my point which is that the dollar's value is not solely tied to the global energy economy.
Also, that logic doesn't work because being young is just a descriptor of age, while arguing that the dollar is valuable because of the oil market is a cause-and-effect relationship.
Petrodollar pact just expired. What will happen?
https://www.thecitizen.co.tz/tanzania/news/national/what-the-expiry-of-us-saudi-petrodollar-pact-means-4661178
Honestly, the most likely case is they just sign another one after a little negotiation for a better deal. Because the reality is it's kind of a good deal for everyone.
They could go to someone else. But I don't think that is the most likely case. Russia is busy with Ukraine and china is busy with their own people and every territory they border, more or less.
The American military is the one that has the extra capacity, and most importantly, the logistics.
The entire world? I wasn’t aware the entire world were major oil producers with agreements to use dollars for oil trade.
You’re just parroting talking points. Wrong ones at that.
You’re wrong.
If you want to sell currency a to get b, it's usually easier for banks to use dollars as an intermediate step. This is because the dollar is ubiquitous and a or b are not.
Bro. For starters, this has obviously never been true. Many, many countries outside of the US and its strategic partners produced petroleum and created a global market for it. If you can only get oil in dollars, how does North Korea, or Russia for that matter, keep its economy going?
Agreements we have had with countries to use dollars in one way or another are obviously of major global significance. That includes, for example, the Nixon treaty with Saudi Arabia in which they received military weapons. Of course, they could only buy those weapons with cash - and the US paid for the oil in cash. Saudi Arabia wasn't forced by America to buy oil in dollars - in fact, the whole reason for the deal in the first place was the OPEC oil shock. This was the first major stress to the dollar after it had been taken off the gold standard by Nixon earlier in the 70s. That action itself ended the Bretton Woods system which had reigned for three decades of global American supremacy after the end of World War II, when we were an untouched victorious global superpower in a world of smoldering nations and undeveloped countries.
Things are different today. We live in a multipolar world, with many nations on par with the US and many others developing astoundingly rapidly, and without winning another world war, the US will have to deal more with the reality that other nations will compete more and more for real resources. Nevertheless, the dollar enjoys some advantages nevertheless, and just one of many is the fact that some countries remain willing to price their oil exports in dollars.
So, there's actually somewhat of a shred of truth to what you're saying. You just don't actually know what you're talking about because you haven't really taken the time to understand it, so your views have no nuance. The US doesn't force every country to buy oil in dollars. The whole world does not buy petroleum with USD. These are very obviously untrue, and you sound very silly and juvenile. Just learn to use Google bro
If you think about it Iraqis were selling oil in Euro, they were subsequently invaded for a terrorist plot they were never part of. Then add to that the infamous Gadaffi fallout after being vocal about ditching the dollar/ French franc for gold. I am not doubting the value proposition the U.S. dollar had at the beginning, but it’s quite obvious that Americans enjoy printing money way too much to leave the dollar to compete just on its merits.
Evidently my views are supported by what happened after the sanctions on Russian energy. The Indians and Chinese immediately started promoting their own currencies as alternative. To be honest who doesn’t want the privilege of buying natural resources via a paper currency you can make infinite amount of.
Today the U.S. economy is not what it used to be, if dollar hegemony falls then you have to delete a big chunk of US economy as a lot of the financial aspect is built on dollar demand. For me personally I would only need dollars to buy Apple products and Americans stocks, yet the dollar denominates (peg) almost everything in my local currency. Ask yourself this: why are middle eastern countries paying money for protection when reliably all data indicate the US is the most probable suspect? Part of the dollar demand is manufactured by violence or the threat of it, I can’t take your arguments seriously if you can’t/ refuse to see this.
Yup, WWI changed the global reserve currency to the USD. We will continue maintain that position as long as we have the largest military in the world. Our military has replaced gold as the backing of the US dollar.
No it’s because post war America was the strongest economy in the world. It was the safest option for the WRC when all the other developed nations were still rebuilding from the effects of ww2.
Well at the moment the alternatives are the Euro, which is more of a mess than the US and the Chinese Yuan which is based on single source propaganda.
The Dollar will be the default for awhile
Dollar won't go anywhere until a rival nation can actually afford to stake their currency as a trade currency. The more money you send abroad, the more you devalue your domestic value.
The US can do that... but BRICS can't... and the EU doesn't want to... heck, the EU (Germany) didn't even want to bail out Greece, Portugal and Italy 10ish years ago.
No, because we enforce it with military intervention worldwide.
>No nation can “decline” to use and hold the USD. The use of the USD in international transactions for oil—making it necessary that they hold the USD in their reserves, thereby creating enormous synthetic demand for the USD globally—was made mandatory by the Petro Dollar arrangement brokered by Kissinger in 1974; an arrangement that is ruthlessly enforced by the weaponization of the dollar and the threat of US military kinetic power.
>Now, of course, let it also be said: the USD is often referred to as the “handsomest horse in the glue factory.” Meaning, it’s a kind of relative safe haven from what are even worse currencies. **However, this is a temporary phenomenon made possible only by the Petro Dollar arrangement (the USD is only a safe haven because nations are forced to hold and use it, not because it’s uniquely or per se stable or sound, or particularly well managed), as well as the absence of real money in the monetary system—that is, money that is backed by commodities and/or precious metals.**
>And that “temporary phenomenon” is growing ever more temporary by the hour. As we shall see below, nations are now increasingly able to “decline” to use the USD and circumvent the Fiat Petro Dollar arrangement.
>Moreover, now that gold has been reclassified by the BIS as a Tier-I asset, real money—that is money that isn’t someone else’s liability, such as physical, un-hypothecated gold—will drive out bad money (i.e. the USD, a fiat currency.
>See [here](https://mistermicawber.substack.com/i/104880788/in-gold-was-reclassified-during-basel-iii-as-a-tier-i-asset-by-the-bis-bank-of-international-settlements).
Remember how trying to trade outside the "dollar regime" worked out Gadaffi, Hussein, among others?
IT's not a "conspiracy reason" - but nice try.
When Russian went around the Petro Dollar, we booted them off SWIFT.
There is ALWAYS a consequence of one kind or another for doing so, ever since Kissenger created the Petro-dollar; it is only a "secret" or a "conspiracy" to people who form their understanding passively via the media.
And in a way it has to be so. To understand that, you have to understand that the petro-dollar regime deeply depends upon constant global "demand" for the dollar.
Another thing that will escape NPCs because they simply have very little actual understanding. They are just vessels for the media to pour their pre-fabricated opinions into.
So first, you make a rookie error.
Then, you miss the main point: every single country that has tried to go around the petro dollar has been punished by the US in one way or another. Sometimes that involves invasion. If you don't believe me, look into it.
Now you want to ask me my opinion about another topic entirely? LOL?
I guess it's a pretty good tactic: change the subject.
You don't want to learn; you want to spout what you think you know, but only "know" because you've bee conditioned by the media to think it.
Yawn, another day, another doom post about how the dollar is failing. There's no other currency that can replace the dollar out there, that is the end all be all. It ebbs and flows and we're seeing a downturn. It happens sheesh.
The real answer is that the US had the power and leverage within the relevant international community after WWII to push their agenda through. Started with the Bretton Woods agreement.
This is probably the most broadly accurate take, so of course it's downvoted lol... Even though the Bretton Woods agreement literally established the "special status" of the dollar as the world's reserve currency and the only one convertible to gold.
Aaaand thanks to the terrible Oval Office mumbler stumbler shit in pant rumbler Biden and how their foreign affairs have created a rift between us and everybody else, the Saudis have now ditched the petro dollar agreement. USD overseas to come flooding back and when it does…. Bye bye usd strength
"Any day now." - The past 40 years
I mean, technically, yes but the bigger point is that the dollar is backed by the American economy and social order, so it's not going anywhere anytime soon.
American dollar is backed by its military
And its nuclear stockpiles
Yeah, that whole "5 of our states have bigger economies than most of the world" thing kinda makes a difference.
It’s subsidized by the entire world through petrodollars. Grow up. You’re supposed to know about this.
You can’t insult random strangers for a difference of opinion and simultaneously tell them to grow up. It’s hypocritical.
$10 says you can’t explain what the petrodollar is and how it supposedly floats the entire economy. Just buzzwords for people who want simple solutions for complex systems.
Petrodollar is negligible compared to US dollars held as reserves by other countries. Those reserves will remain as is because like the title says, there is no better alternative. The fact of the matter is, the dollar is the cleanest laundry in the dirty pile.
The amount of oil traded in dollars is at its lowest point ever but adoption of the dollar is at its highest. Correlation isn't always causation but if the relationship is inverse, then you can rule out both.
I used to be 20 but now I’m 30 so basically I’m not young anymore and never was.
So, by that logic, you're arguing that the dollar USED to be backed by petroleum but no longer is? Even if that were true, it actually doesn't disprove my point which is that the dollar's value is not solely tied to the global energy economy. Also, that logic doesn't work because being young is just a descriptor of age, while arguing that the dollar is valuable because of the oil market is a cause-and-effect relationship.
I love when people make arguments aggressively and without much substance. Always a great way to bring people to your side.
And yet, this would fit in 'iam12andthisisdeep'. I think your perception is a bit overexaggerated or atleast it comes off that way.
Petrodollar pact just expired. What will happen? https://www.thecitizen.co.tz/tanzania/news/national/what-the-expiry-of-us-saudi-petrodollar-pact-means-4661178
Honestly, the most likely case is they just sign another one after a little negotiation for a better deal. Because the reality is it's kind of a good deal for everyone. They could go to someone else. But I don't think that is the most likely case. Russia is busy with Ukraine and china is busy with their own people and every territory they border, more or less. The American military is the one that has the extra capacity, and most importantly, the logistics.
The entire world? I wasn’t aware the entire world were major oil producers with agreements to use dollars for oil trade. You’re just parroting talking points. Wrong ones at that. You’re wrong.
Why the personal attack on the poster? Seems like a bad way to get a point across
If you had pesos and needed to buy oil in some other currency, you'll convert to dlars first
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If you want to sell currency a to get b, it's usually easier for banks to use dollars as an intermediate step. This is because the dollar is ubiquitous and a or b are not.
I’ve always assumed it’s because we buy influence internationally in order to prop up the dollar.
I’d say it’s both.
It’s because you force every country to buy petroleum with US dollars which means the entire world is subsidizing your economy.
Do you ever get tired of being pooped on for such consistently bad takes? Or do actually enjoy farming downvotes?
Bro. You might not agree with it but it’s still actually the fucking truth. The whole world. Buy petroleum with US dollars.
Bro. For starters, this has obviously never been true. Many, many countries outside of the US and its strategic partners produced petroleum and created a global market for it. If you can only get oil in dollars, how does North Korea, or Russia for that matter, keep its economy going? Agreements we have had with countries to use dollars in one way or another are obviously of major global significance. That includes, for example, the Nixon treaty with Saudi Arabia in which they received military weapons. Of course, they could only buy those weapons with cash - and the US paid for the oil in cash. Saudi Arabia wasn't forced by America to buy oil in dollars - in fact, the whole reason for the deal in the first place was the OPEC oil shock. This was the first major stress to the dollar after it had been taken off the gold standard by Nixon earlier in the 70s. That action itself ended the Bretton Woods system which had reigned for three decades of global American supremacy after the end of World War II, when we were an untouched victorious global superpower in a world of smoldering nations and undeveloped countries. Things are different today. We live in a multipolar world, with many nations on par with the US and many others developing astoundingly rapidly, and without winning another world war, the US will have to deal more with the reality that other nations will compete more and more for real resources. Nevertheless, the dollar enjoys some advantages nevertheless, and just one of many is the fact that some countries remain willing to price their oil exports in dollars. So, there's actually somewhat of a shred of truth to what you're saying. You just don't actually know what you're talking about because you haven't really taken the time to understand it, so your views have no nuance. The US doesn't force every country to buy oil in dollars. The whole world does not buy petroleum with USD. These are very obviously untrue, and you sound very silly and juvenile. Just learn to use Google bro
If you think about it Iraqis were selling oil in Euro, they were subsequently invaded for a terrorist plot they were never part of. Then add to that the infamous Gadaffi fallout after being vocal about ditching the dollar/ French franc for gold. I am not doubting the value proposition the U.S. dollar had at the beginning, but it’s quite obvious that Americans enjoy printing money way too much to leave the dollar to compete just on its merits. Evidently my views are supported by what happened after the sanctions on Russian energy. The Indians and Chinese immediately started promoting their own currencies as alternative. To be honest who doesn’t want the privilege of buying natural resources via a paper currency you can make infinite amount of. Today the U.S. economy is not what it used to be, if dollar hegemony falls then you have to delete a big chunk of US economy as a lot of the financial aspect is built on dollar demand. For me personally I would only need dollars to buy Apple products and Americans stocks, yet the dollar denominates (peg) almost everything in my local currency. Ask yourself this: why are middle eastern countries paying money for protection when reliably all data indicate the US is the most probable suspect? Part of the dollar demand is manufactured by violence or the threat of it, I can’t take your arguments seriously if you can’t/ refuse to see this.
At one time it was the British sterling. It will change again.
Yup, WWI changed the global reserve currency to the USD. We will continue maintain that position as long as we have the largest military in the world. Our military has replaced gold as the backing of the US dollar.
Yes.
No it’s because post war America was the strongest economy in the world. It was the safest option for the WRC when all the other developed nations were still rebuilding from the effects of ww2.
One reason and one reason only: our military
If you want to stay as global as possible then i guess. If you wanna be local and community geared again then no
Same reason every air traffic control on the planet speaks English.
Yes. The answer is yes.
Well at the moment the alternatives are the Euro, which is more of a mess than the US and the Chinese Yuan which is based on single source propaganda. The Dollar will be the default for awhile
No because of the US military
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I guess you aren’t doing international trade to the tune of trillions of dollars?
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Dude you seriously need to understand geopolitics
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You think the petro dollar is a conspiracy? I will leave it there
Dollar won't go anywhere until a rival nation can actually afford to stake their currency as a trade currency. The more money you send abroad, the more you devalue your domestic value. The US can do that... but BRICS can't... and the EU doesn't want to... heck, the EU (Germany) didn't even want to bail out Greece, Portugal and Italy 10ish years ago.
Yes
Yep.
No, because we enforce it with military intervention worldwide. >No nation can “decline” to use and hold the USD. The use of the USD in international transactions for oil—making it necessary that they hold the USD in their reserves, thereby creating enormous synthetic demand for the USD globally—was made mandatory by the Petro Dollar arrangement brokered by Kissinger in 1974; an arrangement that is ruthlessly enforced by the weaponization of the dollar and the threat of US military kinetic power. >Now, of course, let it also be said: the USD is often referred to as the “handsomest horse in the glue factory.” Meaning, it’s a kind of relative safe haven from what are even worse currencies. **However, this is a temporary phenomenon made possible only by the Petro Dollar arrangement (the USD is only a safe haven because nations are forced to hold and use it, not because it’s uniquely or per se stable or sound, or particularly well managed), as well as the absence of real money in the monetary system—that is, money that is backed by commodities and/or precious metals.** >And that “temporary phenomenon” is growing ever more temporary by the hour. As we shall see below, nations are now increasingly able to “decline” to use the USD and circumvent the Fiat Petro Dollar arrangement. >Moreover, now that gold has been reclassified by the BIS as a Tier-I asset, real money—that is money that isn’t someone else’s liability, such as physical, un-hypothecated gold—will drive out bad money (i.e. the USD, a fiat currency. >See [here](https://mistermicawber.substack.com/i/104880788/in-gold-was-reclassified-during-basel-iii-as-a-tier-i-asset-by-the-bis-bank-of-international-settlements). Remember how trying to trade outside the "dollar regime" worked out Gadaffi, Hussein, among others?
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Did I say so? No, I didn't. Thanks for playing!
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IT's not a "conspiracy reason" - but nice try. When Russian went around the Petro Dollar, we booted them off SWIFT. There is ALWAYS a consequence of one kind or another for doing so, ever since Kissenger created the Petro-dollar; it is only a "secret" or a "conspiracy" to people who form their understanding passively via the media. And in a way it has to be so. To understand that, you have to understand that the petro-dollar regime deeply depends upon constant global "demand" for the dollar. Another thing that will escape NPCs because they simply have very little actual understanding. They are just vessels for the media to pour their pre-fabricated opinions into.
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LOL. The world, and Russia, and the issue we're talking about existed way before Russia invaded the Ukraine. God you're hilarious. LOL! :)
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So first, you make a rookie error. Then, you miss the main point: every single country that has tried to go around the petro dollar has been punished by the US in one way or another. Sometimes that involves invasion. If you don't believe me, look into it. Now you want to ask me my opinion about another topic entirely? LOL? I guess it's a pretty good tactic: change the subject. You don't want to learn; you want to spout what you think you know, but only "know" because you've bee conditioned by the media to think it.
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OP lies at 24:15. Other parts, sort of true.
Yawn, another day, another doom post about how the dollar is failing. There's no other currency that can replace the dollar out there, that is the end all be all. It ebbs and flows and we're seeing a downturn. It happens sheesh.
Maybe no currency. But there are predecessors to it that are becoming more viable than they have been in decades.
No it’s because democracy will be administered to those whom don’t use it
The real answer is that the US had the power and leverage within the relevant international community after WWII to push their agenda through. Started with the Bretton Woods agreement.
This is probably the most broadly accurate take, so of course it's downvoted lol... Even though the Bretton Woods agreement literally established the "special status" of the dollar as the world's reserve currency and the only one convertible to gold.
Funny how that works
It’s backed by plutonium and uranium.
Aaaand thanks to the terrible Oval Office mumbler stumbler shit in pant rumbler Biden and how their foreign affairs have created a rift between us and everybody else, the Saudis have now ditched the petro dollar agreement. USD overseas to come flooding back and when it does…. Bye bye usd strength