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Local currency in Massachusetts considering removing dollar peg, backing with commodities

Posted by Charlie Kilo on July 15th, 2008

This is interesting:

As BerkShares Board of Directors considers the future evolution of the program, the American Institute for Economic Research, a Great Barrington economic research organization founded in 1933, has called a mini-conference entitled “Prospects for the Acceptance of Competitive Local Currencies: The Future of BerkShares.” Several eminent monetary scholars will join BerkShares board and staff on Friday July 18th from 3 to 5 pm on the AIER campus to imagine growth to a more independent currency.

Iran urges OPEC to move off the dollar

Posted by patriot on June 17th, 2008

Looks like we’re closer to “bomb, bomb, bomb Iran” (since Iraq was trying to move off the dollar before we invaded there):

Speaking at a ceremony to open the 29th ministerial meeting of the OPEC Fund for International Development (OFID), Iran’s President Mahmoud Ahmadinejad repeated his proposal made about six months ago in a rare summit of the Organization of Petroleum Exporting Countries’s heads of states.

“The fall in the value of US dollar is one of the pressing problems of the world today,” warned the Iranian president at the conference in Isfahan on Tuesday.

He further expressed concern over the adverse effect of the dollar depreciation on the international community, especially energy exporting countries through increasing the price of commodities like wheat, rice and oilseeds.

Ahmadinejad said he warned six months ago in the summit conference in Riyadh that there were many indications pointing to continued fall in the value of the greenback.

“And we see that this continues to happen and the resources and wealth of OPEC member countries have been hugely damaged.

“I again repeat my previous proposal; we should have a basket of different international hard currencies as the basis or the member countries should come up and produce a new hard currency for petroleum contracts,” he stressed.

“They get our oil and give us a worthless piece of paper,” Ahmadinejad said earlier after the close of the summit in the Saudi capital of Riyadh.

President Bush wants a stronger dollar

Posted by patriot on June 9th, 2008

Well, boo hoo, Mister President. I want a new truck. You want a stronger dollar. If only we could cash in on wishes…

President Bush issued a call for a rise in the value of the US dollar on currency markets yesterday in a signal of mounting official alarm in Washington about the effect of the slumping greenback on the world’s largest economy.

In an exclusive interview with The Times on the eve of the United States-European Union summit in Slovenia, Mr Bush expressed concern about the dollar’s continuing weakness and said that he favoured an appreciation in the US exchange rate.

“We want the dollar to strengthen,” he said on Air Force One as it crossed the Atlantic bound for the summit.

The President did not suggest that the United States was preparing to back its rhetoric on the dollar with any formal intervention in the exchange markets. He said that the “relative evaluations of economies will lead to that dollar strengthening”.

What I Saw in America

Posted by Charlie Kilo on May 5th, 2008

Paper tiger:

According to this story appearing today, the Secretary-General of OPEC now foresees a time within the decade when oil will no longer be priced in dollars. Like kicking a lumbering giant who has fallen down, this ill- (or well-) timed disclosure could send the U.S. economy further into a severe tailspin. If not immediately, it presages the end of the American Century and the final destruction of an already broken and broke U.S. economy.

Iran dumps the dollar

Posted by patriot on April 30th, 2008

Well, here we go:

Iran, OPEC’s second-largest producer, has stopped conducting oil transactions in U.S. dollars, a top Oil Ministry official said Wednesday, in a concerted attempt to reduce reliance on Washington at a time of tension over Tehran’s nuclear program and suspected involvement in Iraq.
art.Moh.iran..jpg

Mahmoud Ahmadinejad, Iran’s President, has called the dollar a ‘worthless piece of paper.’

Iran has dramatically reduced dependence on the dollar over the past year in the face of increasing U.S. pressure on its financial system and the fall in the value of the American currency.

Oil is priced in dollars on the world market, and the currency’s depreciation has concerned producers because it has contributed to rising crude prices and eroded the value of their dollar reserves.

“The dollar has totally been removed from Iran’s oil transactions,” Oil Ministry official Hojjatollah Ghanimifard told state-run television Wednesday. “We have agreed with all of our crude oil customers to do our transactions in non-dollar currencies.”

As Ron Paul notes in this article, a similar action on Saddam’s part was a major contributing factor in our assault on Iraq:

There was no public talk of removing Saddam Hussein because of his attack on the integrity of the dollar as a reserve currency by selling oil in Euros. Many believe this was the real reason for our obsession with Iraq. I doubt it was the only reason, but it may well have played a significant role in our motivation to wage war. Within a very short period after the military victory, all Iraqi oil sales were carried out in dollars. The Euro was abandoned.

Dollar woes

Posted by Charlie Kilo on April 22nd, 2008

The US dollar hit 71.3 today.

Ouch!

Quick notes on the economy today

Posted by Charlie Kilo on April 8th, 2008

Is the worst over or has it all just begun?

Fed auctions another $50 billion to cash strapped banks

Banks split on whether the worst is over

Pending home sales fall to record low

Oil at $109 a barrel

WAMU get $7 billion infusion, cuts jobs

I’m going to go out on a limb and say that we’re not even close to the light at the end of the tunnel.

Iran to OPEC: Stop Oil Sales in Dollars

Posted by Charlie Kilo on April 7th, 2008

Ahman want his Euro’s! If he’s not careful he’ll get a lot more than that:

Iranian President Mahmoud Ahmadinejad is urging OPEC members to form a joint bank and stop pricing oil trades in U.S. dollars.

According to the Iranian government’s Web site, Ahmadinejad told OPEC Secretary General Abdalla Salem el-Badri the cartel “should establish a joint bank as well as having joint currency.”

Oil is priced in U.S. dollars on the world market, and the currency’s depreciation has concerned producers because it has contributed to rising crude prices and eroded the value of their dollar reserves.

Iran has repeatedly urged OPEC members to shift sales away from dollar. But Iran’s proposal to trade oil in a basket of currencies is not supported by enough OPEC members, which include staunch U.S. allies such as leading producer Saudi Arabia.

The mother of all bailouts

Posted by patriot on March 30th, 2008

Jim at the Survival Blog has a post discussing the latest “mothers of all bailouts”, using taxpayer funds to correct the mistakes of business owners and banking empires. One of the summary paragraphs reads:

All of these macro-level implications might seem fairly abstract, so let me put them in real world terms and take the risk of extrapolating on some trends that I’ve observed: There will be a recession, and it will be deep, and long-lasting. A recession will mean that there will be some big corporate layoffs. Be ready. There will be bank runs and banking “holidays”. Be ready. There will be huge flows of “bailout” funds that will effectively nationalize many industries. Be ready. There will probably be a stock market collapse. Be ready. There will be a further collapse in residential real estate that will make the recent declines seem small, by comparison. Be ready. Credit delinquencies and foreclosures (on car loans, home loans, credit card bills, etc.) will dramatically increase. Be ready. There will be a collapse of the commercial real estate market. Be ready. Even though the credit available for IPOs and private mergers and acquisitions has dried up, there will be news of some large and seemingly inexplicable acquisitions in the near future, all sanctioned by and in some cases, underwritten by, and even funded by, the Federal government. Be ready. There will be shortages of key commodities including fuel and food. Be ready. Strapped for cash, America’s highway, rail, water, sewer, telecommunications, and power infrastructures will degenerate. Be ready. There will be mass inflation of the US Dollar that will devalue any dollar denominated investments. Be ready.

In case you missed it, the main idea to glean from the article is to be ready. :)

China’s Factory Blues

Posted by Charlie Kilo on March 28th, 2008

The days of ultra-cheap labor and little regulation are gone. As manufacturers’ costs climb, export prices will follow

The U.S. housing market, which generated demand for everything from Chinese-made bedroom sets to bathroom fixtures, has plummeted. A new Chinese labor law that took effect on Jan. 1 has significantly raised costs in an already tight labor market. Soaring commodity and energy prices, as well as Beijing’s cancellation of preferential policies for exporters, have hammered manufacturers. The appreciation of the Chinese currency has shrunk already razor-thin margins, pushed thousands of manufacturers to the edge of bankruptcy, and threatened China’s role as the preeminent exporter of low-priced goods.

Continue reading…

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