Skip to comments.Mideast Banks Revolt Against US Dollar
Posted on 03/15/2006 8:58:19 AM PST by ex-Texan
A number of Middle Eastern central banks said on Tuesday that they would seek to switch reserves from the US greenback to euros.
The United Arab Emirates (UAE) said that it was considering moving one-tenth of its dollar reserves to the euro, while the governor of the Saudi Arabian central bank condemned the decision by the United States to force Dubai Ports World to transfer its ownership to a "US entity", the UK Independent reported.
"Is it protectionism or discrimination? Is it okay for US companies to buy everywhere but it is not okay for other companies to buy the US?" said Hamad Saud Al Sayyari, the governor of the Saudi Arabian monetary authority.
The head of the UAE central bank, Sultan Nasser Al Suweidi, said that the bank was considering converting 10 percent of its reserves from dollars to euros.
"They are contravening their own principles," said Suweidi. "Investors are going to take this into consideration [and] will look at investment opportunities through new binoculars."
The Commercial Bank of Syria has already switched the state's foreign currency transactions from dollars to euros, Duraid Durgham head of the state-owned bank said. The decision by the bank of Syria follows the announcement by the White House calling on all US financial institutions to end correspondent accounts with Syria due to money-laundering concerns.
Syria's finance minister Mohammed Al Hussein said: "Syria affirms that this decision and its timing are fundamentally political."
I think there is more to this than just "economic warfare." I suspect these countries -- along with many other foreign investors -- are taking a good hard look at the U.S. economy and realizing that a prolonged period of inflation in the U.S. dollar is almost a certainty. This was the real reason for the 1973 "Arab oil boycott," and it's looking more and more like the early 1970s by the day around here.
Even if the USD declines, it is good for our exports and tourism.
But I am saying that Iran and Syria have been plotting this strategy for some time now. They want to create tough economic times for the U.S. They are using oil as a weapon against America. That is why Iran is starting the oil bourse. That is why the news media in Europe (and some in the U.S.) have been reporting that we are on an Oil Crusade in the M.E. "It's all about oil," shout CNN, CBS, and NBC. Yada, yada.
Isn't the ME going through a stock market crash? Are they trying to deflect from that?
If they can knock the legs out from under us economically (rather than militarily), they know it'll make enough voting idiots over here mad enough to vote a Dhimmie into the POTUS in 2008, and then we go back to practicing euroweenie diplomacy with the ME like we did back in Jimmah's and Bubba's administrations. - OB1
It was rhetorical. I know where you stand.
Thank you! This sounds like people I know who thought telling the boss off was worth getting fired for.
But didn't mind becoming financial burdens on their families and friends. How degrading.
This isn't "national integrity". It's foolishness.
It surely did, but, let us not lose sight of the reaction. Is this how we are looked at because we say no to someone? We now have to say yes to all investment so to not hurt pepoles feelings? I say there are a whole lotta people confused about things...on both sides of the argument.
I'd like to see the list of countries that "allow the US to buy anywhere." I'll bet there are very few who do not restrict our ownership in some fashion. Mexico springs to mind, and doesn't Dubai have restrictions on foreign investments as well?
What the true crime is, the embarrassment is not over the way their citizens(Muslim) handle themselves at home, and abroad....
We should counter-threaten by saying we'll make it our nations mission to make oil obsolete in ten years.
They can go back to riding camels in that worthless sandbox.
I agree. Check out this article No, the Iran Oil Bourse is not a 'casus belli'
Read this article...I agree with it's author...
A euro challenge?
For the euro to begin to challenge the reserve role of the US dollar, a virtual revolution in policy would have to take place in Euroland. First the European Central Bank (ECB), the institutionalized, undemocratic institution created by the Maastricht Treaty to maintain the power of creditor banks in collecting their debts, would have to surrender power to elected legislators. It would then have to turn on the printing presses and print euros like there was no tomorrow. That is because the size of the publicly traded Euroland government-bond market is still tiny in comparison with the huge US Treasury market.
same article as I linked in post #55
The UAE is acting like a spoiled child that didn't get it's way once on the playground and has now decided to take it's ball and go home.