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CEO Of One Of The World's Largest Energy Majors "Sees No Reason For Petrodollar"

Tyler Durden's picture




 

The USA is fast running out of friends to support its 'exorbitant privelege'. Having alienated the Germans over NSA-eavesdropping, 'boomerang'd the Russians into de-dollarization, tariffed and quantitatively eased China into diversification, and finally 'punished' France into discussing the dollar's demise; it appears no lessor person than the CEO of Total (the world's 13th biggest oil producer and Europe's 2nd largest), believes "There is no reason to pay for oil in dollars." Clearly, based on Christophe de Margerie's comments, that we have passed peak Petrodollar.

 

As Reuters reports,

Oil major Total's chief executive said on Saturday the euro should have a bigger role in international trade although it was not possible to do without the U.S. dollar.

 

Christophe de Margerie was responding to questions about calls by French policymakers to find ways at EU level to bolster the use of the euro in international business following a record U.S. fine for BNP.

 

...

 

"There is no reason to pay for oil in dollars," he said. He said the fact that oil prices are quoted in dollars per barrel did not mean that payments actually had to be made in that currency.

So even a major beneficiary of the status quo appears to see the end in sight for the Petrodollar.

 

As we showed only yesterday...(and have ever since 2010)... nothing lasts forever

Meanwhile, somewhere Putin is still laughing.

As Brandon Smith concluded previously with regard the 'anything but random' nature of th emore frequent discussion of the dollar as resever currency:

The dollar is no more invincible than any other fiat currency in history. In some ways, it is actually far weaker than any that came before. The dollar is entirely reliant on its own world reserve status in order to hold its value on the global market. As is evident, countries like China are already dumping the greenback in trade with particular nations. It is utterly foolish to assume this trend is somehow “random” rather than deliberate. Foreign countries would not be initiating the process of a dollar dump today if they did not mean to follow through with it tomorrow. All that is left is for a cover crisis to be conjured.  Existing tensions in the Mideast signal a pervasive crisis, most likely an energy crisis, in the near term.

It appears that making friends and influencing people is the opposite of what America is achieving...at a time when it needs them the most.

 

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Sat, 07/05/2014 - 22:37 | 4928036 Seize Mars
Seize Mars's picture

All orchestrated, all 100% by design. G. Edward Griffin saw this coming in the 1960's and has tried to warn everyone within earshot ever since. This is about one world government. America must be brought low in order for this to work.

Destruction. That's what David Rockefeller and Lord Rothschild want.

Sat, 07/05/2014 - 22:49 | 4928059 economics9698
economics9698's picture

Zionist fucking up another country in 3…2…1

Sat, 07/05/2014 - 22:56 | 4928074 AlaricBalth
AlaricBalth's picture

June 2010 - "A new United Nations report on Tuesday called for the creation of a new global reserve currency to replace the U.S. dollar as the single major reserve currency.

"A new global reserve system could be created, one that no longer relies on the United States dollar as the single major reserve currency," said the report, titled World Economic and Social Survey 2010: Retooling Global Development.

"The dollar has proved not to be a stable store of value, which is a requisite for a stable reserve currency," it said.

The report pointed to "a trap inherent in the reserve and payment system, whereby reserve-creating countries are able to run payments deficits as long as other countries find it in their interest to keep building up their international reserves in the currencies of the reserve-creating countries."

"If this trap is not eliminated, all financial regulatory reform will come to nought," it warned."

http://www.un.org/en/development/desa/policy/wess/wess_current/2010wess.pdf

Sat, 07/05/2014 - 23:09 | 4928088 DoChenRollingBearing
DoChenRollingBearing's picture

We only lose a little bit if the US dollar loses its "exorbitant priviledge".  We no longer would have to run trade deficits to keep the rest of the world with enough dollars to use in trade (ref: FOFOA).

We got along just fine for over a hundred years with out the reserve currency of the world.  And we will be fine with just another regional currency.

And the BRICs don't scare me either.  Boo!  LOL!  All of them have epic problems, worse than our own (which are pretty bad, and our direction is even worse).

So, what to do...  5% - 20% in gold is a great start!

Sat, 07/05/2014 - 23:12 | 4928101 economics9698
economics9698's picture

When we lose reserve currency status you will see $500 billion in merchandise disappear from the shelves.  That is when the crack up boom happens.

Sat, 07/05/2014 - 23:20 | 4928112 Antifaschistische
Antifaschistische's picture

we did fine without the Petrodollar...well, yes but there are many ways to look at that.  Perhaps America would ultimately be better off with $10 per/gallon gas AND the repatriation of tens of thousands of manufacturing and assemblying organizations.

The problem...is that America has no appetite for this line of work.  We think we're too good for it.  The generation who believed that hard work was the key to success is lost in America...and moved to Asia.   The reversion will be very painful.

Sat, 07/05/2014 - 23:28 | 4928126 economics9698
economics9698's picture

If you pay them they will work.

Sun, 07/06/2014 - 00:45 | 4928268 BlindMonkey
BlindMonkey's picture

Hell, if you don't pay them to sit on their asses they will work.

Sun, 07/06/2014 - 04:10 | 4928438 savagegoose
savagegoose's picture

THANKS OBAMA

Sun, 07/06/2014 - 06:34 | 4928520 Obese-Redneck
Obese-Redneck's picture

Don't thank Obama for the debt bubble, thank Bush morons.

Well FOFOA does call for the Euro as the next reserve or to come out on top after a US currency crisis, and yes it is all by design, the Russkies and the Chicoms now it and are in on it.

Sun, 07/06/2014 - 06:54 | 4928533 Ghordius
Ghordius's picture

I was not aware of FOFOA calling the EUR as the next reserve currency

I was aware of FOFOA reasoning on the future of money, fiat, currencies and gold on the same premises and in the same framework that led to the idea of the EUR

so FOFOA admires the elegant design, if you want. one that is neutral to the vagaries of the USD, gold, oil, whatever

one that is based on the incredibly simple premise that in order to import whatever the eurozone can't produce itself, be it Russian NatGas or Arab Oil or Chinese iPads, the eurozone has to match it with exports

it's about sustainability. one pillar of stability. sorry, stabeeleetee

note the political stance of the Banque of France. a country that has had a shift towards nationalism, and so a push to the government to "do something" and "do more" in regard to key political interests in the French industry, be it energy, shipbuilding or financials

and so you see this very special, very national bank taking a "national defence" stance... under the umbrella of the EUR/ECB. again, the EUR is behaving in the way gold used to... by design. of compatibility

Sun, 07/06/2014 - 08:43 | 4928653 Troublehoff
Troublehoff's picture

We got along just fine for over a hundred years with out the reserve currency of the world.  And we will be fine with just another regional currency.

 

Agreed DoChen...

but: a heroin adict used to get along fine without shooting up - there's going to be a very nasty period of cold turkey

Sun, 07/06/2014 - 13:18 | 4929189 fxrxexexdxoxmx
fxrxexexdxoxmx's picture

Only takes about 48 hours. It is not as bad many think. Hurts like hell for about 24 hours after that it smooths out.

Sun, 07/06/2014 - 17:55 | 4929831 Monty Burns
Monty Burns's picture

I can attest to the truth of this as an ex-user in my rock 'n' roll days.  Unpalatable fact is that anyone can get off heroin without too much grief if they really want to.

Sun, 07/06/2014 - 08:44 | 4928654 strannick
strannick's picture

@obesesredneck Obama brought the debt from 10 to 17 million, far and away more than any other President. Give credit where credit is due -pun intended.

Sun, 07/06/2014 - 10:21 | 4928794 moneybots
moneybots's picture

  "Obama brought the debt from 10 to 17 million, far and away more than any other President."

 

Not in percentage terms.  The debt tripled under Reagan and would have to go to 30 trillion to triple under Obama.

17 trillion doubles to 34 trillion.

17 trillion trples to 51 trillion.

 

Sun, 07/06/2014 - 12:38 | 4929073 sylviasays
sylviasays's picture

 "Obama brought the debt from 10 to 17 million, far and away more than any other President." Not in percentage terms.  The debt tripled under Reagan and would have to go to 30 trillion to triple under Obama."

Don't doubt Obama. If he can take the national debt from 10 trillion to over 17 trillion in just four years, he's got two more years (or probably more since it's hard to get Marxist dictators out once they get in) to ratchet the debt up to 34 or 54 trillion easy. 

Sun, 07/06/2014 - 10:30 | 4928815 dwayne elizando
dwayne elizando's picture

That's 17 trillion, not 17 million. ; ) I blame America as a whole. Obama is one man. Congress could've bound the federal reserve from assisting in the national debt bubble but they didn't. When that bubble blows, all the young debt surfs with their overpriced degrees will cry out for debt relief!

Fuck this shit makes me anxious!

Sun, 07/06/2014 - 10:32 | 4928709 Oracle 911
Oracle 911's picture

The crafty Russians and Chinese know one thing, on long run having the worlds reserve currency is deadly trap. That means they will avoid this situation much as possible. But the world need something, so they come up with "energy Ruble", but instead of kWh they will use BTU (both can be converted into J-well they are J), the only reason is this: the electrical energy is generated in power plants while the fuel is burnt. And these processes are everything but effective at lest 50% of energy from fuel is gone (the effectivity of electricity generation is fuel and technology dependent).

 

EDIT: There is another reason why the kWh won't be the king, the transportation. How you price in the transportation costs, when you use motors with internal combustion? (I know horsepower can be converted into kW. But what about the traffic jams, which are clearly here?)

Sun, 07/06/2014 - 10:59 | 4928885 centerline
centerline's picture

stabeeleetee is in conflict with the dogma of groooooooowth.  Must.... have.... growth.  Growth.  Growth.  Growth.  Chant it with me like.  Screw resource constraint.  Ignore demographics.  Nevermind the pressing social complexities.  Growth, growth, growth.

To infinity and beyond...

(p.s. Hawkins was right.  If we dont figure out how to get off this floating rock we are doomed as a species). 

Sun, 07/06/2014 - 11:27 | 4928949 _disengage_
_disengage_'s picture

I keep hearing talk about "getting off the planet". Does anyone realize that 1/3 of the Earth's land is desert? It is WAY easier to rehabilitate a desert on Earth than one on Mars...

Howard Finnel showed you can use on contour furrows/swlaes to infiltrate rain where it falls, stopping runoff/erosion and recharging the land/aquafers. This was in the 1930s.
https://www.youtube.com/watch?v=UFeylOa_S4c

in the 40-60s P.A. Yeomans showed how to rehabilitate Australian drylands with the Keyline Plan (just update Finnel's worked basically).
http://vimeo.com/13323213 (This farm is still active today and run by P.A.'s children)

Later Holmgren and Mollison put these ideas and more together into Permaculture.

Today people like Brad Landcaster, Alan Savory, Geoff Lawton, and many others are actively regreening deserts all over the world.
http://www.harvestingrainwater.com/
http://www.youtube.com/watch?v=YBLZmwlPa8A

Sun, 07/06/2014 - 14:00 | 4929283 americanreality
americanreality's picture

Hawkins?  Okay, dimwit.

Sun, 07/06/2014 - 14:25 | 4929342 TBT or not TBT
TBT or not TBT's picture

France hasn't shifted nationalist one little bit.   They have been all about national interests, read as interests of the state, since cardinal de Richelieu, and never stopped, you silly kniggets.  

Sun, 07/06/2014 - 08:01 | 4928592 stoneworker
stoneworker's picture

Until you have at least 50%-60% of oil producers "in on it" I don't think the dollar will collapse. I wonder what happens when the current Saudi passes away....

Sun, 07/06/2014 - 18:46 | 4929965 quadratic_equation
quadratic_equation's picture

You are not a redneck from your comment.  Your comment is closer to the logic of a negro which is very stupid.  When you ask a negro why Bush caused the debt bubble they say because he spend higher by percentage of the debt instead of the amount spent.  But if you can increase a small amount by hundreds in percentage it's still amounts lower than spending less percentage with large debt.  See here Bush spend $4.7trillion in 8 years to $10.3 trillion, that's close to 84% in spending from the level he started with.  While Obama raised the national debt to $17.4trillion; spending $7.1trillion in 6 years and that's only 67% increase.  When you spend it's the amount you spent that's important not the percentage.

Sun, 07/06/2014 - 02:08 | 4928365 Alcoholic Nativ...
Alcoholic Native American's picture

Says the government contractor. 

Sun, 07/06/2014 - 04:45 | 4928452 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

One has to appreciate the irony. =)

Sun, 07/06/2014 - 08:00 | 4928590 bentaxle
bentaxle's picture

It's in the interests of any absolutist monarch to ally itself with (absolutist) dictators, especially ones that can keep tabs on Syrian or other local Republics that are a little too close to home, that "live just round the corner."

Sun, 07/06/2014 - 06:43 | 4928529 Truthseeker2
Sun, 07/06/2014 - 10:42 | 4928848 dwayne elizando
dwayne elizando's picture

In death, we have a name! His name was petro dollar, his name was petro dollar!

Sun, 07/06/2014 - 18:55 | 4929986 quadratic_equation
quadratic_equation's picture

It's only dead if OPEC decides to renege on the treaty with the US but they will have to be prepared for ?.  It's takes both parties to sign the accord otherwise there's going to be hell to be paid.

Sat, 07/05/2014 - 23:42 | 4928147 edotabin
edotabin's picture

Bringing the jobs back is not as painful as you say. It is just a matter of the people experiencing a lot more pain without those jobs. As it stands the effects are being mitigated by EBT, loose policies etc.  When those stop, and they will, the pain felt will leave millions begging for those jobs to come back.

Besides, this is how it works. It is a controlled cycle:

1. Bring down

2. A few buy everything up for pennies on the dollar

3. Start rebuilding

4. Everything is great again! (only this time people make less, have less etc.)

Sat, 07/05/2014 - 23:56 | 4928188 linniepar
linniepar's picture

Well no shit, they killed the dollar and transferred wealth intentionally! 

Sun, 07/06/2014 - 11:15 | 4928928 KickIce
KickIce's picture

No doubt and if we allow the same assholes to retain power over the next reserve currency absolutely nothing will change.

Sun, 07/06/2014 - 10:32 | 4928820 moneybots
moneybots's picture

"Besides, this is how it works. It is a controlled cycle:

1. Bring down

2. A few buy everything up for pennies on the dollar

3. Start rebuilding"

 

A cycle always completes itself. Price inflation rate went up until 1980.  It could have gone up longer and in that regard it was a controlled reversal, but in every cycle there is an inflection point, where the cycle reverses.

By the way, nobody can buy up for pennies on the dollar, unless there is deflation, as prices have to deflate to be pennies on the dollar.

Sun, 07/06/2014 - 00:27 | 4928186 DoChenRollingBearing
DoChenRollingBearing's picture

Europe right now has $8.00 - $9.00 gasoline, and the euro (for now) is not a reserve currency.  And the taxes on gasoline are much higher than here.

Food is more expensive, but not too much more, than in the USA.

We would do just fine here.  Maybe even encourage companies to invest and people to actually, ah, work, and we might be better off!

 

EDIT:

We are a pretty entrepreneurial bunch as well.  Certainly vs. Europe.  We invented most modern electronics.  We invented Bitcoin.  Almost nowhere on Earth has a better climate for inventing than we do.

We do have our problems though, but our debts and demographics situations are better than in the BRICs or Japan or W Europe.

Sun, 07/06/2014 - 03:20 | 4928402 Lore
Lore's picture

Re: "our debts and demographics situations are better"

Correction: "Our debts and demographics situations are EXCEPTIONAL!"

Sun, 07/06/2014 - 05:16 | 4928475 Ayn-UK
Ayn-UK's picture

I'm living in Europe right now. Gas is $10 a gallon and food is about 60% higher than in the states. I was pricing a bissle furniture vacuum. On amazon US it was $25, on amazon UK it's £60. The exchange rate is around $1.70 to the pound. That's a huge difference. The same goes for cars, clothes, and especially food. A tiny sized can of cat food is over $1. A decent steak is $20 a pound.
I'm not complaining, we are here for our jobs and we knew what we were getting into, but don't fool yourself into thinking everyone will be just fine with less. The middle class have a much lower standard of living here.
Learn to love rump steaks and chicken because fillets and seafood will be out of reach for the average person. And be happy paying over $30k for a hatchback.

Sun, 07/06/2014 - 06:28 | 4928517 Obese-Redneck
Obese-Redneck's picture

Wait till gas prices hit rest of the world rates in USA. The f-350 wide load butt crowd are going to be screaming bloody hell. And when energy goes through the roof and literally 1/3 of the country that only functions because of air conditioning starts melting away the pounds inside of moldy dry wall McMansores, it's not going to be pretty. Long deodorant/anti-perspiration stocks my chubby friends.

Sun, 07/06/2014 - 07:18 | 4928556 Momauguin Joe
Momauguin Joe's picture

Soap, the yardstick of civilization.

Sun, 07/06/2014 - 15:45 | 4929504 Lore
Lore's picture

Re: "A tiny sized can of cat food is over $1."

Cat food is tasty. ...So I've heard. And you'll get a nice shiny coat. If times get REALLY tough, there's always the cat. 

/tongueincheek

Sun, 07/06/2014 - 07:08 | 4928547 barre-de-rire
barre-de-rire's picture

you invented bitcoin ?

 

lol

 

Satoshi Nakamoto sounds so american...  you do not invent, you do like chinese, you steal brevets....  suckers.

Sun, 07/06/2014 - 08:37 | 4928644 SumTing Wong
SumTing Wong's picture

No no no...we did it. We have Al Gore, who invented the Internet...and global warming so that he could trade carbon credits. The man needs to be sainted for all he has done for the U.S.

So Satoshi is nothing...it's Al Gore we all need to praise!

AlGorehu Akbar!!!!

Sun, 07/06/2014 - 09:13 | 4928679 pelican
pelican's picture

I never understood this line of reasoning. We made computers and are therefore are so much better? Yes, we spend tons on research and then have it stolen by countries who think we are suckers.

Does a good investor place all his eggs into one basket?

For a country to flourish diversity is essential.

Sun, 07/06/2014 - 11:05 | 4928897 Lea
Lea's picture

"We made computers and are therefore are so much better? Yes, we spend tons on research and then have it stolen by countries who think we are suckers."

And you are suckers, big time. Spend tons on research, outsource production to save your bucks through slave wages, get your technology stolen by the slave bosses.

Losers.

Sun, 07/06/2014 - 09:47 | 4928726 Winston Churchill
Winston Churchill's picture

I don't think you get it DoChen.

There is going to be a very abrupt change in the standard of living for most everyone.

All those paper claims on wealth will disappear.It will take a generation to relearn basic

manufacturing,to be a generation behind everyone else.

Britain never caught back up, and the USA has made enemies everywhere who will have no

interest in letting the US catch up.

Sun, 07/06/2014 - 12:00 | 4929015 centerline
centerline's picture

+1

Sun, 07/06/2014 - 11:58 | 4929011 centerline
centerline's picture

Oh come on DCRB.  The EU lacks a common debt.  That is the kiss of death (or recipe for war).  From a debt perspective - as screwed as anyone else.  As if the PIIGS are any better off?

EU is a socialist experiment that is about to go off the proverbial cliff (before the US).

Now, could it re-emerge as something different?  Yes!  Especially if it goes tits up first.  Assuming the world is not pounded back into a new dark ages, the first to repudiate onerous debt wins (as long as they are not invaded as a result).  Every soveriegn nation knows this and is eyeing the exits.  

 

Sun, 07/06/2014 - 09:16 | 4928683 Max Cynical
Max Cynical's picture

Serious question...

How will anyone know when the dollar loses reserve currency status?

Sun, 07/06/2014 - 10:15 | 4928785 MontgomeryScott
MontgomeryScott's picture

One of the key indicators will be the refusal of OPEC to accept USD for oil. This is happening. They killed Quaddafi because of this. They killed Hussein because of this. They want to nuke Iran because of this.

Another key indicator is the set-up of trade agreements between nations that doesn't use the USD as a settlement for trade. This is happening. U.K. and China, China and Russia, Russia and Iran, China and Australia, etcetera, etcetera...

There have been many 'doomsday' scenarios proposed regarding the death of the USD. It probably won't 'just' lose it's 'reserve status'; but rather will become worthless and 'dead' in a rapid and unstoppable manner. Of course, when this happens (NOT 'if') the nation formerly known as the United States will end for all practical purposes. I don't think this indicator will be difficult to see. The set-up has been ongoing. For God's sakes, MRAPS in every little police department...

All those 'crazy conspiracy theorists' were right (or will be proven to be). WHAT'S that headline again? 'CEO Of One Of The World's Largest Energy Majors "Sees No Reason For Petrodollar"'

How will you know when the Titanic will sink? WELL, after it tips up and breaks in half and dives under the waves, and you are floating in the water freezing to death and drowning at the same time, THAT would be a good indication.

 

 

Sun, 07/06/2014 - 11:54 | 4929003 gdogus erectus
gdogus erectus's picture

Thanks for the chuckle. That's pretty fuckin' funny.

Sun, 07/06/2014 - 12:02 | 4929020 centerline
centerline's picture

When the music stops (band drowned).  ha ha.

Wasn't there a Zappa song like this... something about someday they pull down the curtains and all you see is the bricks at the back of the stage...

Here it is (thanks interwebs)...

“The illusion of freedom will continue as long as it's profitable to continue the illusion. At the point where the illusion becomes too expensive to maintain, they will just take down the scenery, they will pull back the curtains, they will move the tables and chairs out of the way and you will see the brick wall at the back of the theater.”

Sun, 07/06/2014 - 09:23 | 4928693 g speed
g speed's picture

I beg to differ economics9698-----In fact I know your wrong-- because---last week I needed to find a clutch pack for a little gas bike for the neighbor. In all of this big country there was none--but low and behold I found it on the "net" in China-- at the "Chinese Amazon knock off"  So I bought two with a credit card and it's being sent via China Air---just saying--

the "net" has been cutting into big box for a long time and it's now to the point were Wally World's big product is groceries---in other words the World is your shelf--and I don't see the worlds shelves empty because the fat cats lose monopoly (aka reserve status)

Sun, 07/06/2014 - 12:10 | 4929034 DrewJackson
DrewJackson's picture

This is why I will be going long BABA   those fuckers have everything!!

Sat, 07/05/2014 - 23:30 | 4928131 PGR88
PGR88's picture

Lose reserve currency status, and your prices of energy and groceries will double very quickly.   Your governments (federal, state, local) will be broke, and their unions will raise holy hell to make sure they get their promised benefits.   Look for capital controls and property confiscation.   Societies lowest classes (those especially dependent on government now) will suffer a lot.  Crime will sky-rocket

In sum, think of Argentina or Bolivia.

Sat, 07/05/2014 - 23:45 | 4928161 edotabin
edotabin's picture

Not if you produce a lot of it locally/domestically. America is not Bolivia. I know this place has done and is doing some fucked up things. I also know it is fashionable to like Putin etc.  Even so, America is not Bolivia and it is not realistic to make a direct comparison.

Sun, 07/06/2014 - 00:17 | 4928223 RafterManFMJ
RafterManFMJ's picture

Odd you should say that. A 5 bus convoy just unloaded 500 Bolivians in my town center.

Sun, 07/06/2014 - 08:39 | 4928649 max2205
max2205's picture

Grain beef oil and cheese dollars. ....it ain6 gonna change boooyzzzz

Sun, 07/06/2014 - 01:16 | 4928312 COSMOS
COSMOS's picture

People are people last time I checked, not much difference in natural desires and wants etc.  We differ from Bolivia only in so far as we have a reserve currency.

Sun, 07/06/2014 - 03:51 | 4928428 Bananamerican
Bananamerican's picture

That would make a lot more sense if we were having this conversation in Bolivia

Sun, 07/06/2014 - 04:45 | 4928453 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

That is just silly.

Sun, 07/06/2014 - 06:31 | 4928518 Calmyourself
Calmyourself's picture

Really, lets dump your blond ass in Soweto at midnight see how you do?

Mon, 07/07/2014 - 05:26 | 4930999 COSMOS
COSMOS's picture

About as well as if you dropped it in Compton, Detroit, or Washington DC.  By the way I didnt down vote you because that was hilarious.  I gave you a green arrow.

Sun, 07/06/2014 - 06:54 | 4928534 stoneworker
stoneworker's picture

No we are exceptional I tell you! The rest of the world is subparhumans....for any nazi out there that does not understand why thinking this way is wrong read up on what happened to Hitler, the most exceptional of them all.

Sun, 07/06/2014 - 00:57 | 4928287 AurorusBorealus
AurorusBorealus's picture

The price of food in Argentina is substantially lower than in the U.S. as is the price of most things.  Wages are lower as well, of course, but most people get by here just fine... better than the propaganda spewing from the Financial news people (who are unhappy they cannot just bring dollars into the country at will and buy the whole place up).  There are lots of automobiles on the road, many new, and nearly all produced in Argentina.  My coffee-maker... built in Argentina... my refrigerator... Argentina... my Cabinets... Argentina... my motorcycle... Argentina... my washing mashine... Argentina... get the idea.  If you live in the U.S., where were the items that you need to live manufactured?  Not in the USA... so what happens when the U.S. dollar loses reserve status... well... you cannot buy anything.. because you do not make anything.  See the problem?

Sun, 07/06/2014 - 01:17 | 4928314 COSMOS
COSMOS's picture

We can make the guns and weapons to invade lol and take your Argentinian products from your home and ship them back to the USA ;)

Sun, 07/06/2014 - 04:46 | 4928454 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

American exceptionalism as a euphemism for neo-colonialism?

Sun, 07/06/2014 - 05:55 | 4928497 NidStyles
NidStyles's picture

Worked for the Romans.

Sun, 07/06/2014 - 07:11 | 4928550 barre-de-rire
barre-de-rire's picture

for a limited time

Sun, 07/06/2014 - 12:54 | 4929134 Cloud9.5
Cloud9.5's picture

About 1,000 years.

Sun, 07/06/2014 - 06:33 | 4928519 Calmyourself
Calmyourself's picture

Ferfal describes it as a real wonderland which is why he now lives in Ireland..

Sun, 07/06/2014 - 07:42 | 4928576 Momauguin Joe
Momauguin Joe's picture

So he went from Argentina to Spain to Ireland? USA must be next on his bucket list of failed economies.

Sun, 07/06/2014 - 13:21 | 4929194 Calmyourself
Calmyourself's picture

He is not an illegal.. When you follow the rules, life and choices are more difficult but you knew that didn't you.

Sat, 07/05/2014 - 23:45 | 4928164 Captain Obvious.
Captain Obvious.'s picture

Have you any idea how much you have borrowed on the full faith and credit of the taxpayer?

Sun, 07/06/2014 - 00:32 | 4928249 DoChenRollingBearing
DoChenRollingBearing's picture

Very roughly, about the same as the Europeans and Japanese...

Sun, 07/06/2014 - 11:47 | 4928988 rubiconsolutions
rubiconsolutions's picture

"We only lose a little bit if the US dollar loses its "exorbitant priviledge"."

Unless of course you have to purchase goods and services with dollars. Then you're pretty much screwed. When the USD finally loses its reserve status all those dollars which are now abroad will come running home in a massive selloff. More dollars chasing fewer goods means what? Big time inflation and trips to the market will require huge sums of money. I don't support the petrodollar, forcing the use of a single currency to buy oil but its death will be very painful for much of the population.

Sun, 07/06/2014 - 12:50 | 4929127 QQQBall
QQQBall's picture

Dude, stick to little metal balls

Mon, 07/07/2014 - 11:53 | 4929154 gatorboat
gatorboat's picture

We did fine without the petrodollar because we had a gold backed dollar.   When gold backing ended in 71 Kissinger came up with the petrodollar idea. 

Now SCO natons are preparing a pan-asian gold backed currency.  When it launches, oil exporting nations willl flock to it, petrodollar dies, USD collapases overnight, and yes it will hit every American hard when gas goes from $4/gal to $10/gal.

It doesn't matter how many internal problems SCO nations have.  They have 40,000 tons of gold to back a pan-asian currency ...along with the largest combined nuclear arsenal on the planet to keep western bankers from sabotaging it.

Sun, 07/06/2014 - 17:49 | 4929806 Monty Burns
Monty Burns's picture

"We got along just fine for over a hundred years with out the reserve currency of the world."

The problem lies with the 'we'.  Americans of today and even more so of the future are not the same stock as those that built the country and managed to do fine without owning a reserve currency. Brazil is the future for the USA.

 

Sat, 07/05/2014 - 23:07 | 4928090 Radical Marijuana
Radical Marijuana's picture

"A new global reserve system" would amount to the same old, fundamentally fraudulent, primarily privatized, creation of the public "money" supply out of nothing as debts:

http://philosophyofmetrics.com/2014/07/03/the-arcane-sdr-supra-macro-asset/

The Arcane SDR Supra-Macro Asset
Sun, 07/06/2014 - 00:31 | 4928247 Oldwood
Oldwood's picture

I suppose a single world currency could be a blessing. Then they could print all the money we could ever need and there would be no one to say shit about it. We would finally all be RICH I say! RICH!!

Sun, 07/06/2014 - 07:01 | 4928541 Ghordius
Ghordius's picture

that must be part of the debate that Nixon must have had in his head prior to August 15th, 1971, and which lead to his "we are all Keynesians, now"

Sun, 07/06/2014 - 21:10 | 4930301 MontgomeryScott
MontgomeryScott's picture

NO, while I an humored by your post, I disagree with it's veracity.

THAT would be part of the debate Nixon had with President Kissinger back in '71. I can hear that snake-like thick Austrian accent NOW, speaking in that nasal monotone... 'We have an escape clause to the inability to repatriate the French gold, Mr. President. My friends in the oil producing nations have agreed to back the USD in oil, with a few stipulations, of course. Can I call you Dick? My friends 'The Keynsians' have developed certain techniques that can satisfy you far better than that wife Patti can. Here, let me show you' (The sound of a zipper being pulled down...). Nixon didn't have a CHANCE.

I have found a youtube link that claims to correlate 40 countries that are now dropping the USD as the medium of exchange. The ass-clown that posted it 'assures' everyone that 'this will NOT happen overnight'. The Bear and the Dragon are replacing the Eagle. The demise will be rapid, sudden, and quite soon.

I had to go in to work this day (I don't EVER go in to work on Sunday, but this day was an exception), so I couldn't post this video as an addendum to my previous comment. Bitch says 'this has been going on for years now' (like, um about 1) in the beginning of this video:

http://www.youtube.com/watch?feature=player_embedded&v=mrCI1FS2Xds

You have to learn what you can, and take the bits of truth that you see, and assemble the parts and put them together with other parts that you have accepted as truth, and DISCOUNT the BULLSHIT that always accompanies this stuff. Don't forget to weigh these with proven theorums and so-called 'laws' (like the 'Laws Of Thermodynamics', for example).

The whole 'Euro' thing is not going to last much longer, either, I think. You have been set up to be 'ABSORBED'.

 

Sun, 07/06/2014 - 02:48 | 4928384 conscious being
conscious being's picture

Radical - the sdr idea is doa.  Overly antagonistic West killed off chances of acceptance.

Advice to you- consider that these socioEconomic conditions repeat as cycles.  The last person who knew and could explain how the scam went, died off or was ridiculed into insignifigance.  The fiat 'tower of babel' starts slowly, gets traction and becomes enormous under exponentially growing FRAUD.  

So, this will collapse.  People will gradually forget the lessons learned, while the run away ponzi is again, quietly unleashed.

Sun, 07/06/2014 - 11:21 | 4928942 Winston Churchill
Winston Churchill's picture

The SDR would require trust, and the disarmament of the USA.

How likely is either right now ?

Sun, 07/06/2014 - 14:26 | 4929347 Radical Marijuana
Radical Marijuana's picture

"The fiat 'tower of babel' starts slowly, gets traction and becomes enormous under exponentially growing FRAUD."

No doubt about that, conscious being!

Mon, 07/07/2014 - 01:03 | 4930806 runningman18
runningman18's picture

The SDR will include gold in its basket, which is why numerous central banks have been buying up metals for the past 3 years at least.  That will be the hook the IMF uses to sell the world on the SDR - bet on it.

Sun, 07/06/2014 - 14:01 | 4929288 gatorboat
gatorboat's picture

SDR is monopoly money.  Only has value to those playing the monopoly game. 

Asia isn't playing that game, just western bankers. 

SCO will launch a gold backed currency.   SDR will dry up and blow away.

Mon, 07/07/2014 - 01:07 | 4930814 runningman18
runningman18's picture

Asia is definitely playing that game.  The Chinese are still clamoring to be included in the SDR basket, and the Russians just demanded Ukraine take a loan from the IMF denominated in SDR's.  They will fall right in line just like everybody else.  There is no nation out there that is not controlled by the internationalists.

Mon, 07/07/2014 - 11:58 | 4931720 gatorboat
gatorboat's picture

China and Russia know USD is failing and SDR is bullshit.  They're just maintaining appearances till they launch their gold-backed currency.  

Sun, 07/06/2014 - 01:39 | 4928339 Seeking Aphids
Seeking Aphids's picture

Great post Alaric! Those who claim the $US is here to stay as THE reserve currency do not realise that states are stable until they are not and that stable states can become highly unstable in the blink of an eye.

Sun, 07/06/2014 - 08:02 | 4928594 dogfish
Sun, 07/06/2014 - 19:12 | 4930032 quadratic_equation
quadratic_equation's picture

The UN has no authority when it comes to world economy specially on global reserve.  Never the less, let say they replace the dollar as global reserve that will only effect exchange of food and goods not energy (oil).  The UN is not a signatory to the OPEC neither is Russia so they can use whatever they want for exchange but when the rest of the world buys oil through OPEC members they'll have to use the USD.  Reneging on the a treaty could mean war; afterall, the US constitution says treaties signed by the US congress is law of the land in the US and I'm sure it's also a law in any OPEC nation.

Sat, 07/05/2014 - 22:57 | 4928077 jcpicks
jcpicks's picture

The only winning move is not to play.
How about a nice game of chess?

Checkmate.

Sat, 07/05/2014 - 23:45 | 4928167 F0ster
F0ster's picture

How about a nice game of 'buying all the f'ing gold you can get your sweaty hands on'

Checkmate bitches

Sun, 07/06/2014 - 00:04 | 4928203 Dexter Morgan
Dexter Morgan's picture

I had to down-vote you only because it is "bitchez" not "bitches" in the Fight Club.

Sun, 07/06/2014 - 07:30 | 4928567 OldPhart
OldPhart's picture

Ditto.

There's cherished traditons to behold.

Sun, 07/06/2014 - 21:34 | 4930329 MontgomeryScott
MontgomeryScott's picture

Damn!

He's young (39 weeks), and is just learning. Would you beat a child that is less than a year old for making the 'mistake' of shitting his diapers?

Cut the kid some slack, would you?

HOOK'T ON FONICS WERKED FER MEE!

Give him time to post a few MOAR, BITCHEZ!

NO, I didn't down-arrow Dexter, OR the kid (or you). (Traditions are important, you know.)

The kid's correct. Buy all the physical that you can, and get it as soon as possible (NOW would be a good time, in my humble opinion).

Other 'safe-haven' investments are far more important, though (in the short term).

Sun, 07/06/2014 - 22:32 | 4930528 Dexter Morgan
Dexter Morgan's picture

Agreed.  Rock on!  I've been buying right along.  I closed out my trading account a couple of years ago.  They can't play with my stack anymore!

Sat, 07/05/2014 - 23:38 | 4928081 Radical Marijuana
Radical Marijuana's picture

YES, Seize Mars, in my view it is almost impossible to overestimate the degree to which evil insanities are direting the USA to self-destruct. The most spectacular symbols of that process continue to be, so far, the events on 9/11/2001.

Here are another ten hours of various video documentaries, to attempt to relate 9/11 to the petroleum resource. First, eight hours of background to the oil business:

http://www.youtube.com/watch?v=Qspu35JG59Q&index=1&list=PL940EE01A5338B74B

The Prize (Part 1 of 8) - "Our Plan"

Then, these speculations about the criminally insane plans, which were apparently put in place for Peak Oil problems, as well as all the other interrelated problems, driving us towards the times of Peak Insanities:

http://www.youtube.com/watch?v=oVzJhlvtDms#t=189

Oil Smoke and Mirrors (Full High Quality)

As always, I regard it as so terribly tragic that children will be the primary victims of the ways that most of the older generations have been reduced to behaving like Zombie Sheeple, who do practically nothing to change the fates that will likely befall future generations.

Damn! We keep on repeating similar mistakes, over and over and over and over and over again ... What else can I personally do, but continue to day dream about political and technological "miracles," to imagine how "we" could "adapt," despite that being my own lower consciousness of repeating similar mistakes, like all the others who similarly repeat the same stupid mistakes?

Sat, 07/05/2014 - 23:20 | 4928111 Space Animatoltipap
Space Animatoltipap's picture

Nonsense. The $ was and is simply the currency of the most victorious one after WWII. Now this is fading since time causes destruction to all relative positions. World government is already there since God rules the world. 24/7. This world government on the political stage is always just a most relative event. And you think the Russians, Chinese, Germans, Indians, Iranians etc. would allow for such a development. Think twice. The NY/London money mafia may like to achieve it but competition is huge and ... allying.

Sun, 07/06/2014 - 01:02 | 4928292 post turtle saver
post turtle saver's picture

same shit different day from a member of the ICE... mafuckers have been fighting tooth and nail to wrest dollar control of oil from the US since the day ICE was formed... with Goldman Sachs and Mother Morgan leeching away in the background, playing both sides against the middle...

if I were Deutsche Bank and Societe Generale and just saw what happened to BNP Paribas I'd tell Total and the rest of my fellow cabal members to keep their goddamned mouths shut with all this "the petrodollar is going down" sabre rattling... they got clowns over there thinking that 15 years is enough to accomplish what should take 100 and they're showing their hand waaaay too soon... stupid fucking French, when are people going to learn that those sumbitches cannot keep their heads down and mouths shut to save their lives... so fucking proud for no goddamned reason whatsoever, battleship mouths, rowboat asses and skimming round-trip trades for over a decade _still_ isn't enough to make them happy... by God that goose is only laying a golden egg one at a time, let's cut that bitch open and get 'em all in one shot... lol @ stupid eurotrash in suits

Sun, 07/06/2014 - 08:48 | 4928660 max2205
max2205's picture

Correct,  we will stay number 1 through blackmail.....desperate? 

Sun, 07/06/2014 - 09:59 | 4928755 post turtle saver
post turtle saver's picture

the only people desperate here are the French firms who, if they haven't been caught already, will be caught soon... "don't come after us or we'll take down the petrodollar!"... who sounds desperate there? because anyone dumb enough to say that out loud has to be desperate...

Sun, 07/06/2014 - 01:28 | 4928323 anonnn
anonnn's picture

Jacques Rueff was not just an ordinary economist . His background also included training in scientific methodology which guided his judgement to distcriminate facts and the pseududaa which permeate and overwhelm the pseudoscience of economics.

Rueff advised CharlesDeGaulle on French Treasury/financial matters, conveying with such clarity the historic and demonstrated role of gold to protect trade and settlement. That is why France sent a Navy man-of-war to retrieve its gold from the USA.

Rueff lays out the situation at this link.

http://library.mises.org/books/Jacques%20Rueff/The%20Monetary%20Sin%20of%20the%20West.pdf

It was written to be understood. Even I, a mere commoner, easily followed and received an education from Rueff via that pdf.  It reads like a gift to ZH readers.

Sun, 07/06/2014 - 01:35 | 4928335 anonnn
anonnn's picture

Rueff called the USdollr "America's exhorbitant privliege.

Sun, 07/06/2014 - 05:28 | 4928485 Lea
Lea's picture

And de Gaulle called the US dollar "funny money". My, wasn't he right.

 

Sun, 07/06/2014 - 12:17 | 4929055 DrewJackson
DrewJackson's picture

It is true, but we are all still laughing while France has 30% unemployment.   With out the cilinary arts, wine and cheese the French have NOTHING to offer....

 

Sun, 07/06/2014 - 10:06 | 4928764 post turtle saver
post turtle saver's picture

Rueff and other French losers like him liked to talk big... they spent most of their time planting trees so the German army could march in the shade, who gives a damn what he and others like him thought...

Mon, 07/07/2014 - 05:34 | 4931005 COSMOS
COSMOS's picture

Looks like you got stuck on one of those tree stumps.  I guess his planting worked LOL

Sun, 07/06/2014 - 05:22 | 4928481 TheSecondLaw
TheSecondLaw's picture

And the fall of communism in the late 80's as well as the subesequenjt orchestrated collapse of capitalism that we are seeing now was predicted most precisely by Gary Allen in the 70's in his excellent  book "None Dare Call It Conspiracy".  Vindication.

Sun, 07/06/2014 - 09:54 | 4928741 lakecity55
lakecity55's picture

+10!

Sun, 07/06/2014 - 13:24 | 4929204 tony wilson
tony wilson's picture

let us not forget the original voices of

eustace mullins

anthony c sutton

e.c. knuth

general smedley butler

Sat, 07/05/2014 - 22:37 | 4928037 tony wilson
tony wilson's picture

 

 

Total's chief executive Christophe de Margerie died in his sleep sunday morning just 12 hours after stating that

"There is no reason to pay for oil in dollars.

the cia,mossad and mi6 released a statement saying that the death was 100% natural in every way and that christophe will be buried via a cia helicopter as per standard oil muslim law.

Sun, 07/06/2014 - 00:48 | 4928271 BlindMonkey
BlindMonkey's picture

Nice headline frontrun. You got mad skillz.

Sun, 07/06/2014 - 01:00 | 4928290 Ignatius
Ignatius's picture

It was later clarified that de Margerie was "a lone nut".

Sun, 07/06/2014 - 01:06 | 4928303 post turtle saver
post turtle saver's picture

now _that_ was damned funny, and probably not far from the truth at this rate

Sat, 07/05/2014 - 22:43 | 4928048 q99x2
q99x2's picture

Whoever the TOTUS is working for needs a psychiatrist--big time.

Sat, 07/05/2014 - 22:47 | 4928055 Its Only Rock N Roll
Its Only Rock N Roll's picture

When the US $ loses reserve currecy status does that mean I will not hear "I'm Proud to be an American" during my 4th of July fireworks show?

 

Sat, 07/05/2014 - 22:51 | 4928064 economics9698
economics9698's picture

When the fiat dies Texas and 3/4 of the old USA will not walk but run to the exits.

Sun, 07/06/2014 - 15:21 | 4928807 FeralSerf
FeralSerf's picture

Yes, there'll be lots of refugees. But like Ukraine or Palestine, you won't be allowed to take much wealth with you and the boyz will get all your property at fire sale prices. Unlike Ukraine, where Russia is accepting the refugees, Canada and Mexico may not be so inclined.

As the Nathan Rothschild once stated: "The time to buy is when blood is running in the streets." Real estate is probably pretty cheap in southeast Ukraine now. The same may be true in the "good old USA" when the dollar dies.

Mon, 07/07/2014 - 05:38 | 4931006 COSMOS
COSMOS's picture

Canada will have no choice they will be consumed by the USA for their natural resources.

Sat, 07/05/2014 - 23:45 | 4928166 SofaPapa
SofaPapa's picture

God I hope so!

Sun, 07/06/2014 - 12:58 | 4929142 QQQBall
QQQBall's picture

The Excpetional USA meme will not change. The fireworks show; however, will be bottle rockets and firecrackers produced in Messyko by Chinese companies.

Sat, 07/05/2014 - 22:50 | 4928061 Aussiekiwi
Aussiekiwi's picture

What happens when all those trillions of US dollars return home?

Sat, 07/05/2014 - 22:53 | 4928067 economics9698
economics9698's picture

Frame the paper as a reminder of when we got shit for free.

Sun, 07/06/2014 - 01:19 | 4928317 COSMOS
COSMOS's picture

LOL stop those trillions of dollars at the border and call them counterfeit ;)

You will see great 'financial' and currency border patrol at that point in time.

Sun, 07/06/2014 - 07:01 | 4928539 stoneworker
stoneworker's picture

Wow that is actually a great idea)))....you know what at the rate things are going I will not be surprised if they do just that....there was a glitch in the computer system so we printed $100 trillion too much and since we can't say where it went we simply will no longer accept transfers of dollars to the US in any way shape or form...thank you for playing.

Sun, 07/06/2014 - 09:30 | 4928701 Max Cynical
Max Cynical's picture

or they could simply outlaw assest purchases by foreigners.

Sat, 07/05/2014 - 23:40 | 4928113 Radical Marijuana
Radical Marijuana's picture

"What happens ..."

About 50% inflation!

That will be short-circuited by more genodical wars, along with some democidal martial law, unless there is some series of technological and political miracles ...

Sat, 07/05/2014 - 23:43 | 4928158 Urban Redneck
Urban Redneck's picture

What scares me is that 50% was a common educated best guess/calculation at the end of Greenspan's reign.

Sun, 07/06/2014 - 01:08 | 4928305 Rock On Roger
Rock On Roger's picture

Add a couple zeros to that educated guess.

Sun, 07/06/2014 - 01:20 | 4928318 COSMOS
COSMOS's picture

I say more like 100%, since fuel will double to 8 dollars, currently a little over four dollars for regular unleaded in Cali.  Since so much is dependent on oil in a modern economy I think prices will double across the board.

Sun, 07/06/2014 - 07:20 | 4928557 stoneworker
stoneworker's picture

IMHO is that with the current M1 of $2.5 trillion and foreign holdings and public debt of $12.6 trillion out of which $5 trillion is held by foreign governments we are looking at a 200% inflation as a start....

Sun, 07/06/2014 - 07:38 | 4928572 OldPhart
OldPhart's picture

Prices double, not likely...our money will be considered valueless.  Prices will soar thousands of a percent.  Gas will be around $80 a gallon, hamburger at $100 a pound [if you can find it], water at $500 a month, power at $1k a month...we will be bled dry by everyday costs.

 

Sun, 07/06/2014 - 07:54 | 4928586 stoneworker
stoneworker's picture

It could happen...but I doubt they will let it go that far at least immediately. My point was that the immediate effect would be the doubling of prices on everything....what comes next...well if the derivative bubble pops and they actually decide to bail out some of these banks then I think your story could hold water.

Sun, 07/06/2014 - 10:11 | 4928773 post turtle saver
post turtle saver's picture

I paid $3.79 for 93 premium yesterday... because Texas... the Kali fuel taxes are just ridiculous, y'all need to get a handle on that...

Sun, 07/06/2014 - 05:15 | 4928478 nathan1234
nathan1234's picture

I understand 70% of all US $ printed ( about US$1.2 trillion) is outside the US. When the system collapses the US Govt will just confiscate these dollars by rendering them obsolete.

As for those who have US$ accounts outside the US, it will be the same too

There ends the matter for all those fools who hold the US $.

Of course that will be the day when these ignoramus turn against the US

You can choose to live in the past and forget the future if you hold US$.

 

Sun, 07/06/2014 - 07:23 | 4928561 stoneworker
stoneworker's picture

It would seem like a good idea but it won't work since all of the US companies that are based overseas would be nationalized and that would really hurt the US elites, so they are obviously not going to do that. It is much easier for them to screw everybody else.

Sun, 07/06/2014 - 11:38 | 4928969 Winston Churchill
Winston Churchill's picture

$16tn,not $1.2 tn.

All tertiary claims convert to cash or gold first.

Sun, 07/06/2014 - 10:15 | 4928784 all-priced-in
all-priced-in's picture

The shipping cost will be greater than the value of the dollars - so they will not return.

 

Bulk rate shipping a 1 pound package from Canada - $500,000.

Five thousand  $100 bills weighs 17.6 ounces.

 

 

 

Sun, 07/06/2014 - 15:39 | 4929496 jerry_theking_lawler
jerry_theking_lawler's picture

how much does 16Trillion 1010101's weigh? 1x10-23g?

Sat, 07/05/2014 - 22:51 | 4928066 Dublinmick
Dublinmick's picture

Agenda 21 mandates that America will be returned to a wilderness area. Meanwhile drink your fluoride, eat GMO and be sure to be vaccinated.

There will be no place to store all of the nuclear waste, Carlsbad is blowing up now.

Even the Rabbis are counseling jews to get out of America.

Sat, 07/05/2014 - 22:57 | 4928076 economics9698
economics9698's picture

Pogroms in 3...2...1

Sun, 07/06/2014 - 00:52 | 4928277 BlindMonkey
BlindMonkey's picture

Wait. Is Agenda 21 aided it hindered by nuke waste dead zones? It is kinda hard to lay claim to a world heritage Forrest when it is smoking-radioactive ash. Then again, it will be depopulated.

I am so confused.

Sat, 07/05/2014 - 22:57 | 4928078 hangemhigh77
hangemhigh77's picture

It's time to burn this corrupt rat infested shit house down.  Watch all these bankers and politician bastards run for their lives.  HANG THEM ALL when they lose their dollar and with it their power.

Sat, 07/05/2014 - 23:04 | 4928086 economics9698
economics9698's picture

That seems to be the idea around here.

Sat, 07/05/2014 - 23:23 | 4928115 Radical Marijuana
Radical Marijuana's picture

Yes, but innocent children will suffer worst when that happens.

Do NOT follow this link or you will be banned from the site!