The shadow war in Iraq: Euro vs. Dollar

Hey guys, I found an amazing article in an Hindu newspaper.

�Behind the war in Iraq is a struggle for economic dominance between America and Europe. A clash of civilisations is nowhere in sight.�

Here the link:

www.thehindu.com...

The theory comes from an Australian economist, and since I rode it I am completely amazed�

What does it mean? This is what I call a conspiracy, actually.

If that theory is right, this could explain a lot of things�
Somebody out there can refuse/support this theory?

not sure if this is related but....

I heard that if the dollar continues to weaken and the euro continues to grow due to a weak American currency the the EU will cripple itself..

I'll explain....

The weaker the dollar the more investers will wish to invest in a cheaper market, same goods just lower cost.
But with the euro growing in value investers are worried by the costs of investing due to the high costs.
This would mean a reduction in investment in Europe (euro currency countries) and an increase in investment in America.

Yes, what you say is true at some extent.

But a higher value of the Euro is very good for the importation, while is bad for the exportation.

And what Europe actually needs is to import, from the point of view of the most important good: The oil.

But the core of this explanation for the war in Iraq is that if finally the oil trade is switched to Euros instead of dollars, the American economy as an overall fill fall, while the Euro-zone economy will become the world dominant economy.

And, what is more interesting, the American military power will inevitably fall, and the European military power will rise, since the American military power is directly linked to the fact that the dollar is the oil currency so far.

Iraq made the mistake of switching its oil exports to the Euro, and the higher value of the Euro gave them huge benefits. Iran took note and therefore, George Bush included Iran in the �evil axe� immediately afterwards. Despite Saudi Arabia is the main supporter of the global terrorism, the USA has not threatened the Saudis. Why? Because the Saudis kept and will keep trading their oil in dollars.

Hugo Chavez, from Venezuela (4� oil exporter in the World) was also studying the possibility of trade the Venezuelan oil in Euros, looking at the Iraqi sucess, and immediately afterwards he suffered an attempt of military coup supported by the USA.

The core of the world economy are not the factories, the goods or the food, the inversions here or there. The core of the World economy is the oil. If Europe make the oil exporters trading in Euro, Europe will became the world dominant superpower both economically and military in a matter of years.

The USA needed to stop this extremely dangerous tendency among the oil producers. The UK would benefit also largely from this, since the high relative weight of the Brit economy in Europe will decrease if the Euro win the oil battle. Therefore the UK is the main European supporter of the war in Iraq.

I don�t know whether all this is true, but at least is a quite interesting and logical theory.

It should also be remembered that 80% of Europe's trade is done internally within the EU.
Therefore the truth is that Europe - thanks to the Euro - is in many ways nicely insulated from currency instability.

In fact although a high dollar obviously impacts on European exports this is not so straight-forward as the flip side of this is that many raw materials used in the manufacture of such goods and the energy (oil or gas) used is priced in US dollars and are becoming ever cheaper.

[edit on 27-12-2004 by sminkeypinkey]