Petroleum-backed Dollar

1 Apr

April 1, 2012

Petroleum-backed Dollar

The US dollar fiat currency is, contrary to the view of many experts, backed by a mineral. It’s not gold or silver but petroleum.

This is what the struggle in the Middle East. It is all about control of the access or transportation routes for petroleum and natural gas. If the United States controls the access/transportation routes, then it can control the currency in which petroleum and natural gas are sold.

The US dollar is propped by the fact that petroleum and natural gas are sold in US dollars. Any threat to this must be extirpated: witness Saddam Hussein and Muammar Khadafi. That is why so much pressure is being applied to Iran, which has threatened to set a petroleum bourse.

The US military is used to defend the petro-dollar. The US doesn’t care who buys the oil so long as it is in US dollars.

The fact that the US dollar is backed by petroleum allows the US to create hundreds of billions, even trillions, of dollars out seemingly thin air.

The US government is willing to immiserate its own population to pay the costs of its military actions, so that the elite can have access to all the benefits of speculation and military conquest.

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