By amazing coincidence, Iraq, Libya, and Venezuela traded oil in currencies other than US dollars

By amazing coincidence, Iraq, Libya, and Venezuela traded oil in currencies other than US dollars. By Ricardo.

This is about the petrodollar system that has kept America the dominant economic power for 50 years. …

Venezuela has 303 billion barrels of proven oil reserves. The largest on Earth. More than Saudi Arabia. 20% of the entire world’s oil [reserves].

Venezuela was actively selling that oil in Chinese yuan. Not dollars. In 2018, Venezuela announced it would “free itself from the dollar.” They started accepting yuan, euros, rubles, anything BUT dollars for oil.

They were petitioning to join BRICS. They were building direct payment channels with China that bypass SWIFT entirely. And they were sitting on enough oil to fund de-dollarization for decades. …

Oil is the most traded international good. If it is traded exclusively in US dollars (as has been the case from the 1970s until recently), then there is a huge need for US dollars outside the US.  For example, for Australia to buy oil from Saudi Arabia, Australia needs to earn USD and then exchange those with the Saudis for oil.

To earn US dollars, countries or organizations outside the US must export real goods and services to the US, for which the US pays in US dollars — which it creates with a few strokes on the right computer, or even with a literal printing press. The US thereby gains large amounts of real goods and services for the privilege of providing the world’s currency. (The demand for US dollars outside the US also pushes up their price, which makes US manufacturing less competitive, but that’s a different matter.) The biggest US export is US dollars.

In 1974, Henry Kissinger made a deal with Saudi Arabia: All oil sold globally must be priced in US dollars. In exchange, America provides military protection. This single agreement created artificial demand for dollars worldwide.

Every country on Earth needs dollars to buy oil. This lets America print unlimited money while other countries work for it. It funds the military. The welfare state. The deficit spending. The petrodollar is more important to US hegemony than aircraft carriers.

The US is significantly wealthier by virtue of issuing the world’s reserve currency. The Europeans wore it while the cold war was on, because the quid pro quo was that the US shouldered most of the defense burden in the West.

Don’t threaten the privilege:

And there’s a pattern of what happens to leaders who challenge it:

  1. 2000: Saddam Hussein announces Iraq will sell oil in euros instead of dollars. 2003: Invaded. Regime change. Iraq’s oil immediately switched back to dollars. Saddam lynched. …
  2. 2009: Gaddafi proposes a gold-backed African currency called the “gold dinar” for oil trade. Hillary Clinton’s own leaked emails confirm this was the PRIMARY reason for intervention. Email quote: “This gold was intended to establish a pan-African currency based on the Libyan golden Dinar.” 2011: NATO bombs Libya. Gaddafi sodomized and murdered. Libya now has open slave markets. “We came, we saw, he died!” Clinton laughed on camera. The gold dinar died with him.
  3. And now Maduro. With FIVE TIMES more oil than Saddam and Gaddafi combined. Actively selling in yuan. Building payment systems outside dollar control. Petitioning to join BRICS. Partnered with China, Russia, and Iran. The three countries leading global de-dollarization.

This isn’t coincidence. Challenge the petrodollar. Get regime changed. …

The US is increasingly mismanaging the US dollar. The USD is now visibly accelerating into an inflationary trend, driven by deficits and debt with no end in sight. Too many countries want out, even apart from the political complications (e.g. confiscating Russia’s US Treasury bonds in 2022).

But here’s the DEEPER problem: The petrodollar is already dying.

Russia sells oil in rubles and yuan since Ukraine. Saudi Arabia is openly discussing yuan settlements. Iran has been trading in non-dollar currencies for years.

China built CIPS, their own alternative to SWIFT with 4,800 banks in 185 countries. BRICS is actively building payment systems that bypass the dollar entirely. The mBridge project lets central banks settle trades instantly in local currencies.

Venezuela joining BRICS with 303 billion barrels of oil would accelerate this exponentially.

Not really about:

Not stopping drugs. Venezuela accounts for less than 1% of US cocaine.

Not terrorism. There’s zero evidence Maduro runs a “terror organization.”

Not democracy. The US supports Saudi Arabia, which has zero elections. …

The end of the US dollar as the world’s reserve currency is inevitable now.

What will the US do with Venezuela? Given the monetary imperative, they will do just enough to restart the Venezuelan oil industry and sell the oil in US dollars.

Venezuela? A poster child for the evil of too much socialism:

David Archibald:

Back in 1998 when Chavez was elected president of Venezuela, the Venezuelan middle class said it was going to be a disaster and begged the US to intervene. The US response was that it had been a democratic election and the will of the people should be respected.

It was a disaster. Maduro lost the 2018 election but seized power to stay president.

Few people can be bothered to learn how paper money is created, and the implications,. It explains much about how the world works, so without an understanding of money a lot of events don’t really make sense. You can be pretty sure that almost no lefty activists have any clue, because they are uninterested in money and economics — especially this guy, leading the “Free Maduro” march in Seattle:

 

Chaser, by Elon Musk:

When Chavez came to power in Venezuela, one of the first things he did was take the guns away from the people. He basically banned the private gun ownership, under the guise of safety.

Then Maduro had the election recently, he lost by a landslide and just ignored the election. People protested and they got shot. They couldn’t defend themselves.

That’s why you need the second amendment.

We need guns to protect us from the government. Apart from that, they are of course dangerous and cause deaths and injuries that might otherwise be avoided. But for protecting us from tyrrany, they are indispensable.