Posted on 02/05/2005 9:42:08 PM PST by jb6
MOSCOW -- Russia has abandoned efforts to tie the ruble's movement to the dollar and has decided to instead shadow both the dollar and the euro.
The move has caused experts to predict that other countries could institute similar policies, the Financial Times reported Saturday.
The move has also caused speculation that Russia may denominate its oil exports, 81 percent of which goes to Europe, in euros. Russia is second only to Saudi Arabia in oil exports.
"Russia has talked about the idea of pricing its oil in euros. If it is starting to put more weight on the euro in terms of its forex (foreign exchange market) regime and reserves, then that speculation will be re-ignited," said Ian Stannard, currency strategist at BNP Paribas, a European banking and financial group.
The dollar should go down. It's a good thing for our economy. Let Europe try being the home of the defacto world currency for a while.
The world's reserve currency will be the euro by sometime late next week I should think. The dollar sell-off will correct for the hidden subsidy the US economy has enjoyed since Bretton Woods. I suggest we bury our heads in the sand and pray for better days.
The 500 euro bill is very popular in Russia and Europe. More convenient for moving cash around than a $100 bill.
Not necessarly, first, a weak dollar means oil is more expensive, as are any commodities brought into America, which includes various inputs to manufacturing that takes place in America. Also, all those winter fruits, flowers, etc will go up accordingly. With higher oil prices (dollar buying less) then everything is affected. Now if Saudi Arabia also follows suite and changes to the Euro, we will be forced to buy the Euro for oil as other nations are dropping the dollar like used underwear, which means, daily our dollar will buy fewer Euros and thus less oil, which will have a direct effect upon our economy and manufacturing sector and credit listings.
Two problems, with oil more expensive, there will be less manufacturing in the US. Also, China is still tied to the US so it is still cheaper to do it in China then the US.
By next week? Surely you're joking...
The Russians have not thought this through and will. Europe has ZERO population growth and their equivalent of a Social Security crisis is 10X worse. Recall the CIA report of a few weeks ago. They will probably dissolve the EU within 15 years. The Euro will cease to exist.
We're doomed!...doomed!...
Not. Bush could announce tomorrow total U.S. troop withdrawal from Europe within a couple of years. The Euro would plummet.
OTOH, we can simply wait for the EU to implode within the next 5-15 years.
You beat me by a few seconds in predicting the demise of the EU within 15 years. Great minds may think alike, but yours is quicker.
There have been rumours about the price of oil. Namely, that the House of Saud has been promised we would support them as long as oil stays under some benchmark, I'm not sure what.
The whole attitude about a low dollar being good because it boosts our exports is a flat out lie.
We DON'T HAVE a manufacturing base in this country anymore.
Which would go a long way to explaining why even as the dollar continues to collapse (and oil prices to rise again) that our trade deficit continues to grow not shrink.
12,000 are DUmmie couldn't get that on a warm day for gay marriage .
Here in NYC we have a tourism base and the number of europeans flooding the city is without precedent. And for whatever it's worth, the sale of specialty goods, handcrafted furniture, jewelry and other luxury items is at an all time high.
The folks from western europe are flooding the good old USA spending up a storm.
It isn't just a trade/manufacturing issue. YOUR take home pay becomes worthless!
We want the dollar to be the reserve currency, otherwise it would lose an estimated 25% of its value and screw up our financial markets soon thereafter.
People in the industry are hinting that ANWR would make Saudi Arabia look like a mud puddle by comparison.
They are in NYC. Friends of mine who sell or make expensive stuff are reporting a huge jump in sales to europeans. Unfortunately, these types of businesses don't employ a whole bunch of people.
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