A Euro collapse - The WHAT IFs

[GoFlyKiteNow]

Trust me, it has absolutely nothing to do with the strength of the dollar.

If you an oil exporting country who sold oil in Euros, if you don't revert back to dollar, your earnings will be eaten by the ever weakening Euro.

Which comes back to the question:

Why?
Who triggered the Euro crisis, who benefited from the Euro depreciation?

If you must know, the ECB ( European Central bank ) backs 40% of the Euro value with US dollars.

No matter what, if you buy a Euro. it has 40% of its value set against the backdrop of the US dollar.

Sure the Saudis can sell their oil in Euro or in their own Rials or Dinars. No sweat. The market looks at the cross rates against the US dollar and arrives at the barrel price in US Dollars.!!!

( Remember,,the Saudi central bank would have set their currency to the US dollar on the spot market ). The effect is exactly the same - as if the oil was priced in US dollars.

I do not see any thing complicated or conspiratorial here. In fact there in no necessity !!

When people say Euro ( or for that matter any currency or commodity ) is rising or falling, they are simply stating...that ONE US DOLLAR can buy " more or less " of the other currency or commodity.

When you have 98% of the global trade and commerce determined in US dollars ( Letter of credits, International loans and transactions ), and also the US economy is 40% of the global economy in GDP wise....try removing the US dollar out of the equation. There would be an almost instant collapse/meltdown of all global monetary system.
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[Sperminator]

Dear GOFLYKITENOW,

I believe what you say totally.

USD is the MOST IMPORTANT De Facto Currency for the WORLD.

It is the measurement of Purchase Power Parity.

Even Burgernomics, from THE ECONOMIST, used USD 6.80 as 1 PPP

As currently 1 Big Mac is priced USD 6.80 in USA and 1 Big Mac is priced USD 1.83 in China. Making China's YUAN PPP as 3.71.

Euro currency is always measured against USD

From my understanding, the backbone structure of the entire world's financial system is based on USD.

Euro is just a sub-set of the financial system.

Thus, even if Euro crumbles, nothing drastic will happen, just that all the Union members would have to revert back to their pre-Euro Currency. For example, Germany will go back to Deutchmarks etc... All countries raise up their boarders again, and market protectionism kicks in again, every country would have to have their own Customs & Immigration at the Boarder.

The USD cannot Hyper-Inflate, the USD cannot fail, for it does, the world's economy will go with it... the USD must stand.

 

[theDoors]

Thanks for your information.

I really do agree that The program is the US dollar regime.

This concept was designed to control the world, via financial means.

In fact this financial war has been happening since 1971, 15 August, when NIXON announced the depegging of USD with GOLD.

And USD is the dominator of WORLD CURRENCY.

USA are full of consumers, and very few factories. It is as good as taking USD from USA, and world give them "FREE" GOODS. The world is acting as the slaves of USA... providing goods and services, in return of USD (purely perceived value).

If one day, everyone decides that USD is valueless, it will be valueless, on the other hand if everyone decides that USD is worth it's value, and so shall it be, because, every value that man place in any object, or person, anything, is all perceived...

Very perceptive.

It's a CONfidence game with a cabal of bankers as the invisible hand and the US military as the iron fist.

 

[theDoors]

Read this book: The Hidden Hand of American Hegemony: Petrodollar Recycling and International Markets (Cornell Studies in Political Economy)

The book was previously classified.

http://books.google.com.sg/books?id...&resnum=4&ved=0CCUQ6AEwAw#v=onepage&q&f=false