JimBowie1958
Old Fogey
- Sep 25, 2011
- 63,590
- 16,767
OK, I rarely agree with Obama, but he is right on this one.
Obama Rips Bill That Would Allow 9/11 Victim Families to Sue Nations That Support Terrorism - Breitbart
ROSE: And what about this legislation in the Congress that will allow families to sue the Saudi government? And other governments in similar circumstances.
OBAMA: Exactly. I’m opposed because of that second clause in your sentencee and that is this is not just a bilateral U.S.-Saudi issue. This is a matter of how generally the United States approaches our interactions with other countries. If we open up the possibility that individuals in the United States can routinely start suing other governments, then we are also opening up the United States to being continually sued by individuals in other countries.
OK, folks, we have much more exposure than the Saudis do in regard to lawsuits by other nations.
But beyond that, we also have this thing some call the 'Petrodollar' and the Saudis have our US dollar by the short hairs.
The Rise of the Petrodollar System: “Dollars for Oil” | Jerry Robinson | FINANCIAL SENSE
A petrodollar is a U.S. dollar that is received by an oil producer in exchange for selling oil and that is then deposited into Western banks.
Despite the seeming simplicity of this arrangement of "dollars for oil," the petrodollar system is actually highly complex and one with many moving parts. It is this complexity that prevents the petrodollar system from being properly understood by the American public.
Allow me to provide a very basic overview regarding the history and the mechanics of the petrodollar system...
According to the agreement, the United States would offer military protection for Saudi Arabia’s oil fields. The U.S. also agreed to provide the Saudis with weapons, and perhaps most importantly, guaranteed protection from Israel.
The Saudi royal family knew a good deal when they saw one. They were more than happy to accept American weapons and a U.S. guarantee to restrain attacks from neighboring Israel.
Naturally, the Saudis wondered how much was all of this U.S. military muscle was going to cost…
What exactly did the United States want in exchange for their weapons and military protection?
The Americans laid out their terms. They were simple, and two-fold.
This is why no matter how much money the US government blows or how big our debts, the US has never seen runaway inflation like the Weimar Republic did. There is an overwhelming demand for US dollars so that nations can buy Saudi oil.
But our recent warming to Iran, the Saudis chief enemy in the Middle East, along with our cozying to Israel could make our relationship with the Saudis break this arrangement.
Non-Dollar Trading Is Killing the Petrodollar -- And the Foundation of U.S.-Saudi Policy in the Middle East
Preparing for the Collapse of the Petrodollar System
Obama knows he cannot kick this agreement into the trash or else the entire US currency system could collapse.
Obama Rips Bill That Would Allow 9/11 Victim Families to Sue Nations That Support Terrorism - Breitbart
ROSE: And what about this legislation in the Congress that will allow families to sue the Saudi government? And other governments in similar circumstances.
OBAMA: Exactly. I’m opposed because of that second clause in your sentencee and that is this is not just a bilateral U.S.-Saudi issue. This is a matter of how generally the United States approaches our interactions with other countries. If we open up the possibility that individuals in the United States can routinely start suing other governments, then we are also opening up the United States to being continually sued by individuals in other countries.
OK, folks, we have much more exposure than the Saudis do in regard to lawsuits by other nations.
But beyond that, we also have this thing some call the 'Petrodollar' and the Saudis have our US dollar by the short hairs.
The Rise of the Petrodollar System: “Dollars for Oil” | Jerry Robinson | FINANCIAL SENSE
A petrodollar is a U.S. dollar that is received by an oil producer in exchange for selling oil and that is then deposited into Western banks.
Despite the seeming simplicity of this arrangement of "dollars for oil," the petrodollar system is actually highly complex and one with many moving parts. It is this complexity that prevents the petrodollar system from being properly understood by the American public.
Allow me to provide a very basic overview regarding the history and the mechanics of the petrodollar system...
According to the agreement, the United States would offer military protection for Saudi Arabia’s oil fields. The U.S. also agreed to provide the Saudis with weapons, and perhaps most importantly, guaranteed protection from Israel.
The Saudi royal family knew a good deal when they saw one. They were more than happy to accept American weapons and a U.S. guarantee to restrain attacks from neighboring Israel.
Naturally, the Saudis wondered how much was all of this U.S. military muscle was going to cost…
What exactly did the United States want in exchange for their weapons and military protection?
The Americans laid out their terms. They were simple, and two-fold.
- The Saudis must agree to price all of their oil sales in U.S. dollars only. (In other words, the Saudis were to refuse all other currencies, except the U.S. dollar, as payment for their oil exports.)
- The Saudis would be open to investing their surplus oil proceeds in U.S. debt securities.
This is why no matter how much money the US government blows or how big our debts, the US has never seen runaway inflation like the Weimar Republic did. There is an overwhelming demand for US dollars so that nations can buy Saudi oil.
But our recent warming to Iran, the Saudis chief enemy in the Middle East, along with our cozying to Israel could make our relationship with the Saudis break this arrangement.
Non-Dollar Trading Is Killing the Petrodollar -- And the Foundation of U.S.-Saudi Policy in the Middle East
Preparing for the Collapse of the Petrodollar System
Obama knows he cannot kick this agreement into the trash or else the entire US currency system could collapse.
