It’s All About the Euros
So David sent me this sweet little summary of the
>currency co
nspi
racy theory
about why — in the face of a staggering lack of “evidence” f
or a
causus belli
i> and astonishgly high levels of domestic dissent and anti-war support — the Bush Gang is so eager to topple Saddam and why “old Europe” is so eager for this not to happen. In 2000 Iraq switched from US Dollars to EU Euros as its oil currency, effectively enlarging the Euro asset base considerably. Apparently, Iran is also considering switching from $ to ?. Although the dollar has already depreciated by nearly 20% against the Euro over the past year or so, if Iran and other OPEQ countries switch to Euro-denominated oil, then this would immediately cause a huge asset deflation of the Dollar. This in turn could lead to non-oil assets being withdrawn from dollar denomination and switched to Euros. A depreciation of around 50% would not be unusual — indeed UK Sterling suffered a sequence of more rapid and massive jolts in the decades after WW2 as the American Empire replaced the British Empire and the Dollar replaced Sterling as the currency of trade.
So in geopolitical terms it’s necessary for the US to very publicly, very visibly put the Big Smackdown on the first client oil state to make a clean break from US monetary hegemony. And it also explains why the Germans and French, never previously really noted for their humanitarian concerns (think of Germany/Balkans and France/Rwanda/IvoryCoast most recently), suddenly seem to be coming over like choirboys. And of course the UK, possessing the only major European currency outside the Euro monetary system and intimately tied to the US Dollar (because of its oil production and investment links), and Tony Blair are the only significant Powers supporting Bush’s preemptive attack.
I note in closing that one other significant country recently decided to switch from Dollars to Euros for oil trading: North Korea (2002-12-7). If Iran does switch then the entire Axis of Evil is now backing the Euro system, which should give those Treaty-Of-Rome-Antichrist-Mark-Of-The-Beast Nuts something to chew on.
