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Oil to stop trading in dollars? Demise of the dollar

steadysaver
steadysaver Posts: 389 Forumite
in Debate House Prices & the Economy
A news article in the independent says secret meeting have been held between Russia, China, Japan, France and the Gulf nations to de-couple oil trading from the dollar. Possibly using gold instead.

http://www.independent.co.uk/news/business/news/the-demise-of-the-dollar-1798175.html

Is this the demise of the American dollar?

Comments

  • purch
    purch Posts: 9,865 Forumite
    To be fair, this is not a new story. Similar one's to this have been doing the rounds for at least the last 18 months.

    No smoke without fire.

    The USD day's as THE reserve currency are over, that is for certain.
    'In nature, there are neither rewards nor punishments - there are Consequences.'
  • Harry_Powell
    Harry_Powell Posts: 2,089 Forumite
    steadysaver wrote: »
    Possibly using gold instead.

    Um, isn't Gold priced in Dollars?
    "I can hear you whisperin', children, so I know you're down there. I can feel myself gettin' awful mad. I'm out of patience, children. I'm coming to find you now." - Harry Powell, Night of the Hunter, 1955.
  • steadysaver
    steadysaver Posts: 389 Forumite
    Harry_Powell wrote: »
    Um, isn't Gold priced in Dollars?

    Good spot. I never thought of that. Clearly neither have they
  • mr_fishbulb
    mr_fishbulb Posts: 5,224 Forumite
    Part of the Furniture Combo Breaker
    Harry_Powell wrote: »
    Um, isn't Gold priced in Dollars?
    Looks like it will be priced in oil
  • Generali
    Generali Posts: 36,411 Forumite
    10,000 Posts Combo Breaker
    Harry_Powell wrote: »
    Um, isn't Gold priced in Dollars?

    It is but not at a fixed rate. That Gold costs more or fewer Dollars is the same thing as saying Dollars cost less or more Gold.
  • Harry_Powell
    Harry_Powell Posts: 2,089 Forumite
    Generali wrote: »
    It is but not at a fixed rate. That Gold costs more or fewer Dollars is the same thing as saying Dollars cost less or more Gold.

    Isn't that the same for Oil? That Oil costs more or less Dollars is the same thing as saying Dollars cost less or more Oil? Or any asset to be honest.

    The point I was trying to make is that the only way to break the connection between Oil and the Dollar is to use an alternate currency. The Saudi's mooted using the Euro but were soon brought back into line by the US, probably by a combination of carrot and stick.

    Another approach mooted was the creation of a new IMF currency and pricing against that, which would give a level playing field for all nations, not just the US.
    "I can hear you whisperin', children, so I know you're down there. I can feel myself gettin' awful mad. I'm out of patience, children. I'm coming to find you now." - Harry Powell, Night of the Hunter, 1955.
  • Generali
    Generali Posts: 36,411 Forumite
    10,000 Posts Combo Breaker
    Harry_Powell wrote: »
    Isn't that the same for Oil? That Oil costs more or less Dollars is the same thing as saying Dollars cost less or more Oil? Or any asset to be honest.

    Yes, I agree with that.
    Harry_Powell wrote: »
    The point I was trying to make is that the only way to break the connection between Oil and the Dollar is to use an alternate currency. The Saudi's mooted using the Euro but were soon brought back into line by the US, probably by a combination of carrot and stick.

    Another approach mooted was the creation of a new IMF currency and pricing against that, which would give a level playing field for all nations, not just the US.

    Your original point seemed to be dismissive.

    Now to respond to your clearly constructive point I would say that fundamentally the House of Saud can accept whatever they want in return for 'their' oil.

    I think I agree with you in that the Sauds want to retain the support of the US and the US want to keep on buying Saudi oil.
  • Harry_Powell
    Harry_Powell Posts: 2,089 Forumite
    Generali wrote: »
    Your original point seemed to be dismissive.

    I'm pleasantly surprised to find that I have such a command of the written word that I could convey such emotion and meaning with just 6 words.
    "I can hear you whisperin', children, so I know you're down there. I can feel myself gettin' awful mad. I'm out of patience, children. I'm coming to find you now." - Harry Powell, Night of the Hunter, 1955.
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