Why OIL price is tied to the Dollar ?

[EqualOpportunities]

I wonder if USD as the world reserve currency will end soon. What wil it be? Chinese currency presumably?

PS what is the Chinese currency anyway?

It is the Yuan Renminbi.

[Not So Wise]

Because when a country starts trying to sell it's oil in anything but USD, America does one of following

*Invade (Iraq)
*Declare you a terrorist supporter and threaten to invade (Iran)
*Declare you a corrupt commy pig and start financially supporting your enemies (Venezuela)

And US will continue to do this and get away with it until the Saudi's turn against them, which will never happen because USA is their biggest supporter, even though Saudi Arabia makes Iran and North Korea combined look liberal and democratic and produces majority of islamic terrorists.

But on flip side, less than 7 years ago all LARGE transactions in banking instruments used to be always in USD, but that has been changing a lot recently, partially due to the weaking dollar but more because of the massive interfearance by the US Fed Reserve in transactions that had nothing to do with them beyond the payments being made in USD

[AlfredJPruffock]

Because when a country starts trying to sell it's oil in anything but USD, America does one of following

*Invade (Iraq)
*Declare you a terrorist supporter and threaten to invade (Iran)
*Declare you a corrupt commy pig and start financially supporting your enemies (Venezuela)

And US will continue to do this and get away with it until the Saudi's turn against them, which will never happen because USA is their biggest supporter, even though Saudi Arabia makes Iran and North Korea combined look liberal and democratic and produces majority of islamic terrorists.

But on flip side, less than 7 years ago all LARGE transactions in banking instruments used to be always in USD, but that has been changing a lot recently, partially due to the weaking dollar but more because of the massive interfearance by the US Fed Reserve in transactions that had nothing to do with them beyond the payments being made in USD

Interesting points.

I happen to recall a few months an article which stated that if China dumpedi ts dollar reserves it would be akin to an atomic bomb on the US economy - surely the Chinese must be in a position now - given the chaos on Wall St to do exactly that ?

Remember China has already threatened to use (real) Nukes against the US should they decide to intervene with Chinas claim to Taiwan.

[TimberWolf]

Remember China has already threatened to use (real) Nukes against the US should they decide to intervene with Chinas claim to Taiwan.

Just let them try taking Hong Kong, we'd send out the fleet.

Oh hang on, they've already done it, but they waited for Maggie to retire.

[Not So Wise]

I happen to recall a few months an article which stated that if China dumpedi ts dollar reserves it would be akin to an atomic bomb on the US economy - surely the Chinese must be in a position now - given the chaos on Wall St to do exactly that ?

Sure they are in a position to do that but it's not in their benefit to do so, quite simply because the Chinese own large chunks of corporate America, they are the second largest holder of U.S. Bonds and Treasury Notes and USA is the largest importer of Chinese goods in the world
So while they could tank the economy at any time, they would take a nearly as big hit themselves
But it has been known for a while the Chinese have been slowly but surely quietly offloading their dollar reserves at discounted prices, which on top of everything else weakened the dollar even more

[expat]

Just let them try taking Hong Kong, we'd send out the fleet.

Oh hang on, they've already done it, but they waited for Maggie to retire.

Nothing to do with a 99-year lease signed in 1898, then?

[snaw]

Nothing to do with a 99-year lease signed in 1898, hen?

Why let that get in the way of a good old daily mail style rant?

[2uk]

alien

Can any of you pundits then suggest which currency money should be kept in ? Surely not dollars ?

[expat]

alien

Can any of you pundits then suggest which currency money should be kept in ? Surely not dollars ?

Are you looking for good sense, or speculation? The sensible answer is, the currency that you expect to spend in. As for speculation, some of you may have noticed that I have to work for a living. Obviously I do not know how to get rich quick.

[BrilloPad]

alien

Can any of you pundits then suggest which currency money should be kept in ? Surely not dollars ?

Where is atw when you need him?

EUR seems to have been the next most popular after USD. I still think CHY will take a stronger and stronger position.