International Monetary Fund (IMF)discuss plans to replace dollar

[secretcreek]

And you think oil prices are high now???? Just wait....oh, and buckle up!

http://money.cnn.com/2011/02/10/mark...llar/index.htm

This scares the crap out of me.
-scrt crk

[Ernie]

Me too. You won't have to worry about oil prices if this happens ... you won't be able to buy it here for any price.

This, and a lot of other financial situations seem to be centered around the March/April timeframe. Now would be a great time to buy extra food. A lot of food. As much as you can afford.

Go over your plans, make sure your generator is working and that you've got extra fuel stashed, make sure the bugout bags are ready to go and keep the vehicles topped off. If you have any money left over, a silver/gold purchase might be in order.

If we hit June and nothing has happened, no big deal. The consequences of prepping and being wrong are minimal. The consequences of not prepping and being wrong are disastrous.

[mpillow]

I'm going out shopping tonight....we usually take one vehicle but I wonder if we should take 2 and load up!

I've got to get some more hay as well...and start breeding the bunnies!

And my oil tank is low...we were hoping to change it out for a larger one inside and put the smaller outside! ARGH!

[Ernie]

While my oldest boy and I were out in the barn this morning doing chores, I asked him what his plans for the future were.

He replied, "You mean after the economy collapses and half of America starves to death? I will gather armed survivors from the ruins and then I'll rule with an iron fist!"

While it was amusing at the time to see a kid knee deep in straw and pushing a recalcitrant ewe out of his way state this ... I wonder what I may be unleashing upon the world soon.

[Deacon Mike]

Originally Posted by secretcreek

And you think oil prices are high now???? Just wait....oh, and buckle up!http://money.cnn.com/2011/02/10/mark...llar/index.htm

This scares the crap out of me.
-scrt crk

Can you explain why this would effect oil prices? The currency oil is priced in is not relevent to its cost in dollars

[secretcreek]

Simple answer:

We (USA) have the dollar-the world's reserve. The oil people like our dollars and we get cheap prices for oil. The rest of the world ( UK/France/Germany...etc..) pays over the equivalent of $6.00-7.00 per gallon equivalent...because they DO NOT have world reserve status/dollar.

*Glad I bought a huge box of trash bags yesterday! < produces a rather wan smile>...

Wall Street is going to wobble on the news of IMF, Egypt's Overthrow-Mubarek steps down, possible Abdullah death news. Dow is up!

Interesting times....Interesting fulcrum of events.
--
scrt crk
sick to my stomach...

[mpillow]

Originally Posted by Ernie

While my oldest boy and I were out in the barn this morning doing chores, I asked him what his plans for the future were.

He replied, "You mean after the economy collapses and half of America starves to death? I will gather armed survivors from the ruins and then I'll rule with an iron fist!"

While it was amusing at the time to see a kid knee deep in straw and pushing a recalcitrant ewe out of his way state this ... I wonder what I may be unleashing upon the world soon.

LOL He'd better learn to tame the beast and his iron fist!

[Deacon Mike]

Originally Posted by secretcreek

Simple answer:

We (USA) have the dollar-the world's reserve. The oil people like our dollars and we get cheap prices for oil. The rest of the world ( UK/France/Germany...etc..) pays over the equivalent of $6.00-7.00 per gallon equivalent...because they DO NOT have world reserve status/dollar.

Europe pays high gas prices due to taxes and government policies. It's got nothing to due with the dollar.

[secretcreek]

Originally Posted by Deacon Mike

Europe pays high gas prices due to taxes and government policies. It's got nothing to due with the dollar.

I defer to someone who knows to explain better than I. Gov policies/Taxes and the inability to produce their own petroleum?
-scrt crk

[Ernie]

Europe's price for gas is probably actually IMPROVED by a weak dollar. Since they're required to buy oil with petrodollars, a higher exchange rate means they get more oil for their euro.

Of course if the American dollar tanks then it's up in the air what all the other currencies will do. It's impossible for me to predict since I don't have solid data on what foreign countries are holding in bonds and currency.

Personally, I think if the dollar tanks than most of the world will be reduced to trading in canned goods and shotgun shells for the short term and probably gold and silver for the long term.

[gunseller]

From the story there is no other currency to go to unless they start their own. The Euro is not in as good of shape as the $. It will be a long time and the $ will have to go down a long ways before there is any real thought of changing to a differant currency. It is all talk and US bashing. Nothing is going to change.
Steve

[Callieslamb]

From what I understand, everyone now has to switch their currency into $ to buy oil. THat is a huge advantage to the US $ - since everyone needs them. If they switch off the $ - then no one needs it and it's value goes down the drain.

However, last month, we were discussing the Yuan being used to buy oil. The month before.....and before...and before. They really don't have a currency that is more stable that they can switch to right now. THey do seem to be looking and we should all be very concerned about it. The US $ stand to lose more than 1/2 of it's value if this happens. Which, to me means, everything could end up costing 2x a much. Not good.

[Ernie]

They may not have a currency that looks very attractive right now, but imagine how those other currencies will look as our dollar continues to devalue. They may start to look a whole lot better if we continue into freefall.

[kirkmcquest]

Having the dollar as the worlds 'currency of exchange' means there is always a demand for dollars. What happens to the value of something that is in high demand? It goes up. The value of our dollar is high because the demand for it is high because it is recognized and used as an international medium of exchange.

If that changes, if dollars are no longer needed, then the demand for it goes down....and with it, the value.

[kabic]

Just thinking out loud here....

If things got really bad for the U.S. and we truly stated a radical decline do you think the people of the U.S. would allow it? Remember Americans are used to getting what they want, when they want, and as much as they want.

At what point would they start supporting a government that is willing to do whatever is necessary to keep that lifestyle. What could be accomplished with the size and sophistication of our armed forces if we weren’t such nice guys with such strict rules of combat?

[Deacon Mike]

Originally Posted by Ernie

Europe's price for gas is probably actually IMPROVED by a weak dollar. Since they're required to buy oil with petrodollars, a higher exchange rate means they get more oil for their euro.

The fact that the dollar is used to price oil has no impact on Europe. They operate in Euros.

Originally Posted by Callieslamb

From what I understand, everyone now has to switch their currency into $ to buy oil. THat is a huge advantage to the US $ - since everyone needs them. If they switch off the $ - then no one needs it and it's value goes down the drain.

Oil is priced in Dollars. It can be bought and sold in whatever currency the buyer and seller agree to. And even if the buyer uses dollars, there's nothing to stop the seller from instantly converting to some other currency or to a commidity such as gold

Originally Posted by kirkmcquest

Having the dollar as the worlds 'currency of exchange' means there is always a demand for dollars. What happens to the value of something that is in high demand? It goes up. The value of our dollar is high because the demand for it is high because it is recognized and used as an international medium of exchange.

If that changes, if dollars are no longer needed, then the demand for it goes down....and with it, the value.

It doesn't matter so much what is the currency of exchange, it matters what currency a nation chooses to hold it's assets in.

[tab]

Welcome kabic, nice to see a new poster.

Thanks for posting the link. IIRC this is an issue Beck has talked about. He has a great way of breaking complex issues down and explaining them.

[tab]

Still don' t know how to post links using my phone but in the thread "Collapse of the money system" this subject is touched on with good info.

[edjewcollins]

What scared the hell out of me was not the talk about the dollar not being the reserve currency. It was the fact that IMF sure sounds like they are talking about the wide-spread establishment of their own currency, Special Drawing Rights, as the new "Global Dollar". Nothing like fast-tracking the new world order to freak me out.

[Spinner]

Originally Posted by kirkmcquest

... The value of our dollar is high ...

The value of our dollar has almost eroded to nothing. Before the fed reserve took control of our money, $20 was worth an ounce of gold. Today 1356 dollars are worth an ounce of gold. Figure it out and you'll discover that a dollar is only worth a few thin pennies.

Gold isn't any more valuable today than it was back then. Back then you could buy a good riding horse for an ounce of gold, today you can still buy a good riding horse for an ounce of gold. The difference is that it takes about 68 times more dollars to make that purchase. This is for the simple reason that dollars are only worth a fraction of what they were worth back then. They are losing value faster today than ever before due to the printing presses running in fast motion 24/7.

How many countries will want to hold our dollars with the value of them evaporating? If they are holding dollars today, they can exchange 1356 of them for an ounce of gold. What if it takes twice as many dollars to buy an ounce of gold next year? They would be losing buying power. That is why they are searching for an alternative method of safe guarding their wealth. They see TPTB devaluing the dollar by mismanaging them. Until or unless TPTB stop eroding the dollar, it will become TP.