Tag Archives: MOVING BEYOND AMERICA

WHAT NOT BEING ABLE TO BUY OIL IN DOLLARS MEANS

What Not Being Able To Buy Oil In Dollars Means

By Ian Welsh

October 09, 2009 “Crooks and Liars” —  The big news this week on the financial front was the Independent’s claim that Gulf Arabs and France, Japan, Russia and Japan were planning to move from buying oil in dollars to buying it in a basket of currencies, including gold and a new universal currency shared by the Gulf nations.Buying oil in dollars is one of the foundations of the dollar’s role as the world’s primary reserve currency. Because the the dollar is the world’s primary reserve currency Americans have been able to borrow money for significantly less than other countries are able to. This has both made America more prosperous, and through the perverse incentives of cheap money, helped lead to the high indebtedness of American citizens and the financial crisis. Continue reading