On Sunday 17 February 2008 the first phase of Iran’s oil and petrochemical bourse in Kish Island was inaugurated, paving the way for “all major currencies of the world” to be used in future oil transactions. To understand the significance of this event, let’s take a look back at our history, starting with World War I. The following short video (2:08) recaps the events that resulted in Britain landing troops in Iran in 1914, and consequently occupying Iraq. A more detailed and glorified recollection of these events can be witnessed through one of the greatest epic movies of all time, ‘Lawrence of Arabia’.
We fast-forwarded to the first attempt of Middle Eastern countries to free themselves of Western control of their resources with Iran in 1951, when the democratically elected presented, Dr. Mohammed Mosaddeq, nationalizated Iran’s oil industry. Unfortunately however, Western powers would not stand idly by while Iranians took control of their own resources, which is why in 1953 the CIA, following instructions from Britain, organized a coup against Dr. Mosaddeq and overthrew the government. This was a well documented event and general knowledge among all those who lived in the Middle East and Asia for decades, but was not well known in the West until the year 2000 when the United States government released documents on the operation, and apologized to Iran and its people for the devastation that it unleashed. The following short video (4:39) is a good introduction to this topic.
Let’s now discuss the purchasing power of the US dollar.
Since the end of the Second World War, the US dollar has become the international reserve currency. The need for countries to maintain US dollar reserves was solidified in 1974 during the Nixon administration, when negotiations with Saudi Arabia assured that the oil would only be sold in US dollars, and surpluses from oil proceeds would be invested in U.S. Treasury Bills. In return the US would militarily and economically protect the Saudi regime. Since that time, US dollars have dominated world markets – until the year 2000 that is.
The following article, “The Real Reasons for the Upcoming War With Iraq”, which was written before the US invasion of Iraq, lays forth an argument that the war in Iraq was not just about oil but about the currency in which oil is traded. It is mandatory reading for anyone who wants to understand the basic concepts of American foreign policy, economics, and its military operations around the world. This article states that the principle reason why the United States invaded Iraq was because Saddam Hussein in the year 2000 went ahead with his plans to stop using the US dollar in its oil business and start using the Euro.
The trading of oil for the Euro instead of US dollars is an extremely important historical precedent set by Iraq that must be understood to fully grasp the implications of Iran’s announcement in December of 2006 that they would “use Euro instead of US dollar in (their) next year’s budget.” If the United states was willing to invade Iraq to prevent oil from being traded in any other currency than the dollar, then it would be logical to assume that they will also confront Iran regarding their plans to permanently and absolutely phase out the US dollar.
This now brings us full circle to the opening of Iran’s Oil Bourse. Since Saddam Hussein’s declaration that Iraq would begin to sell oil in other currencies, a few very significant events have taken place. Iran’s announcement that it would follow suit is just the tip of the iceberg. Many other countries have already started to sell the US dollar and to convert to other currencies. Some of these countries include: Sweden, Cuba, U.A.E., China, Russia, India, Indonesia, North Korea, Venezuela, and many more.
It is a fact that oil is the only reason the US dollar has maintained its value and acceptance as the world currency. Once countries can buy oil in non-US dollars then the complete collapse of the American Empire will occur.
All countries are aware that the US has been printing absurd amounts of their fiat currency, and they are no longer willing to hold reserves that continue to devalue. This devaluing has become accelerated since the discontinuance of the M3 report. “On March 23, 2006, the Board of Governors of the Federal Reserve System” ceased publishing the M3 monetary aggregate. The M numbers (M1, M2, and M3) are “components of the United States money supply”, which “show the amount of dollars in circulation”.
click to enlarge source
“M1 is the most volatile, equivalent to cash on the loose. M2 is less volatile, equivalent to savings account deposits. M3 is least volatile, equivalent to Rich Folks Money which they park.” Clearly, the data indicates that “there has been substantial money growth since 2000”. If there is more money in circulation then it becomes devalued.
Not knowing how much money the Banks are printing means that there is no longer an accurate indication of how much currency is in circulation. This basically means that we are playing Monopoly with people who can take money out of the bank anytime they want, because they are the bank. This should be raising alarm bells across the United States the way it has done across the world, as the dumping of the US dollar by most countries indicates. After all, why would anyone want to hold on to a currency that has lost more than 67 percent in five-years relative to its peers? This is one of the main reasons why Iran and other OPEC countries have been so adamant on switching from the US dollar to other currencies (which is what the Oil Bourse will accomplish).
The United states now finds itself between a rock and a hard place, because they will either need to invade, bomb, or enforce sanctions against Iran along with any other OPEC country that decides to stop using US dollars, or they will have to watch the complete collapse of their economy and the devaluing of the Federal Reserve currency known as the US dollar.
Corporate conglomerates are well aware of what is happening. The following short video (10:07) is from a Senate hearing about Halliburton’s dealings with Iran. Keep in mind that if US companies are doing business in Iran then they are making their profits in non-US dollars. On the bright side, private individuals and small companies are becoming wise to this. In the last few months ‘Euros accepted’ signs have popped up in New York City which tells us that the “US dollar just ain’t what it used to be”.
This escalation between the US and Iran is also reaching its climax at a time when news sources are reporting that Vice President Dick Cheney wants to bomb Iran instead of negotiating for a peaceful resolution. While at the same time Bush has approved CIA plans to destabilize Iran, hoping to achieve the same result as in the 1950s when the CIA overthrew Dr. Mohammed Mosaddeq’s democratically elected government.
In addition, in recent weeks a few major events have unfolded that should give rise to concern. These events include:
- Nuclear Weapons going for a ride over the United States
- Israel bombing Syria
- US declaring Iran’s Islamic Revolutionary Guard a terrorist group
- Iran declaring the CIA and the US army as terrorist organisations, and
- Major underwater Internet cables being cut, sending large portions of the Middle East into communication blackout
This unparalleled build-up of military forces by both the United States and Iran is dangerously close to a full confrontation. Unfortunately for the world, the predicated casualties for any military escalation in the Middle East are astronomical.
Are you pissed yet? You should be, especially considering that well over one million innocent civilians have been killed in Iraq.
NOTE: The significance of CIA’s meddling in the affairs of sovereign countries can not be overemphasized. It was the ‘success’ of this Iranian coup that paved the way for US covert intervention across the globe that has brought us to the present crisis, to the brink of Nuclear World War III.