Iran, Russia dump dollar for rial, ruble

reply to post by GLaDOS


That might not be a very reliable news source. There was no Russian statement in any other newspaper that I read and that includes a Russian English language newspaper. It appears that their source is wholly based upon something Iran said. Iran earlier said that Russia had made a huge oil deal with them, but the next day Russia denied it.

reply to post by Magnificient


Its PressTV - The offical news agency for the Iranian Government.

"Permanent SCO members include China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan. Iran, along with India, Mongolia and Pakistan..."

I think they just listed the Axis powers. I agree that this is going to make some governments very angry indeed, although I won't say which ones (notably America's)...So would it be correct to assume that China bailed on Iran, while Russia is still hanging in there? My grasp of the entire situation is not that strong, so I may have incorrectly perceived the situation based on skewed knowledge.

Originally posted by Thundersmurf

Just like Lybia. We all know what's coming next

No, we don't.

The problem with all of it is, what the Russians are planning. The russians are already one step closer to war, even if it didn't get noticed much ... but then, they claim to have some real weapons. It will be interresting to see if the Russians have the balls, to test these weapons by giving some of them to Iran. The russians needs them tested ... and a good ol'whipping for the US, would be a good trade boost.

reply to post by bjarneorn


I was really only talking comparatively about them as a nation moving away from the $ as a trade currency, but yeah you're right, it's gonna get scary. Russia had a monumental collection of arms at one point.

Do you think Russia need to have them tested due to their recent rocket failures in the space industry? It must all come from similar technology.

Originally posted by daniel_g
Lets see, if we buy stuff from China and Russia in US Dollars, but they don't want to use them, then we are exchanging paper for goods.

If Russia and China saved billions in US Dollars because they wouldn't trade them with someone else, and the dollar suddently lost most of its value, then they would not be able to buy as much goods with that paper as we did.

I fail to see how any of that hurts the US. The rest of the world chose to use the USD because of the low chance of it losing it's value. If they want to shoot themselves on the foot, then let them do it.

edit on 8-1-2012 by daniel_g because: (no reason given)

It hurts the US because their economy is based on consumerism. If Russia, Iran and China stop trading in Dollars, others will follow an before you know it...that paper you have in your back pocket that isn't backed by anything will be worth less than the paper you wipe your a** with.

The US needs Oil to be traded in its currency or it becomes a very pointless currency...

reply to post by bjarneorn


Neutron bombs are much more environmentally friendly than atomic bombs, as are the rumored scalar weapons that Russia (and I'd assume by now the U.S. as well) has.

At least we don't have to resort to obliterating the Earth, we can simply wipe out a majority of all life and leave a majority of infrastructure in tact.

Originally posted by kawika
Being the reserve currency for the world allows us to print as much money as we wish.

If that ends (as it did for the Brits), that would be bad.

This is exactly the point here...

The US government is in panic over the possibility of the dollar losing its status as the global reserve currency...

Originally posted by AzureSky
Do the same they did with libya.
Go in, destroy and murder.
Set up a central banking system
Puppet government.

That whole speel.

Yeah, except we can't just plow into Russia and take over.
The big dogs have come out to play now

if this is real prepare for a showdown, USA Vs Iran FIGHT!!!

Originally posted by Corrupted Data
reply to post by GLaDOS

 

well well well, Sure the americans are gonna be pissed.
What next I wonder??

WWIII...

Yeah, the power elite don't like when countries go off the dollar. Harder to control them.

Originally posted by GLontra

Originally posted by kawika
Being the reserve currency for the world allows us to print as much money as we wish.

If that ends (as it did for the Brits), that would be bad.

This is exactly the point here...

The US government is in panic over the possibility of the dollar losing its status as the global reserve currency...

If they are, they have a very interesting way of showing it, by announcing sacntions against any country's Central Bank that deals with Iran's Central Bank. Now, any country that trades with Iran must necessarily deal with her Central Bank. So if a country's (which doesn't wish to sever its trade with Iran) Central Bank cannot deal with the Federal Reserve or invest in US financial markets, what possible use can a trade surplus in US$ be used for? So Russia, China or any other country that does not intend to break its trade with Iran, but not face adverse consequences because of the sanctions signed into law by Obama, they have to ensure they don't have a trade surplus held in US$. Of course, they can hold their trade surplus in Euros, but with the Eurozone in such a wonderful economic state, with a possible collapse of the Euro looming large over the horizon, saving the trade surplus in Euros would be a questionable decision, to put it mildly. The remaining traditional alternatives are Japanese Yen, Pound Sterling and Swiss Franc, none of the economies being large enough to warrant putting all their savings into without taking a huge risk.

In order to mitigate the risk, the country with a trade surplus in a bilateral trade denominates the surplus in her own currency. In this instance if Iran has a trade surplus with Russia it will be denominated in Irani Rial and if it is the reverse it will be denominated in Roubles. Essentially the one with the trade surplus is investing in the economy of the other without the risk of the investment getting devalued by a devaluation of the currency of the other. Hitherto the investments were going into either the US or Eurozone economies these two being the biggest reserve currencies.

Now the funny thing is all these countries are being forced into doing this, not doing so all by their choice. Evidently this will have a strong negative impact on the value of the US$ and the one initiating it is the US government. I won't be so arrogant as to claim that what I could work out in a few minutes could not have been anticipated by the US government. So they are deliberately destroying the value of the US$ in the foreign currency markets. The question is why?

The last time the US deliberately devalued its currency was during the Vietnam war, at whcih time it ws nominally pegged to gold. This devaluation led to bank run on the Fed and after two devaluations it was delinked from gold and allowed to float freely against other currencies. A move that should have seen the dollar plummet but saved by the OPEC decision to peg oil to the US$. Considering that Venezuela, a friend of the US at that time, was the prime mover behind this decision, it can be surmised that the devaluation was a ploy to usher in an oil-backed $ regime from a gold backed one. What could be the motive this time round?

Since the delinking of the US$ from gold, the US government accumulated huge debt denominated in US$ that is increasingly making the bookkeeping difficult. In order to service the debt, the US government's income has to increase and for that to happen the US economy has to grow. For that to happen more and more resources have to flow to the US. With the global energy availability reaching a peak, it is not a sustainable model. So how can the US maintain control over global resources without its economy consuming more and more of the same? The trick would be to create a currency to which the US government has preferred access, but the US economy has no access to without the permission of the government. It cannot obviously be a national or regional currency, but has to be a global currency for it to meet these criteria. When this currency is introduced, it should appear to solve a global problem and not a deliberate plan to usher in such a currency.

Contd...

reply to post by Observor

... Contd

Most likely in the following months both the US$ and Euro will plummet. There will be a huge cry from creditor nations like China to find an alternative to these currencies lest their savings go to zero. An already existing international monetary agency, possibly the IMFor the BIS (Bank of International Settlements) will issue a new global trading currency. Each country/region will be issued an amount proportional to its foreign currency assets or in the case of the US and EU an agreed upon amount. All participating countries will agree to trade their exports for this new currency. The creditor nations are happy because now they can invest their savings in any country they please or simply leave them with the bank without any risk of devaluation, an option that does not exist today. The different central banks will be free to accept other currencies, but this global bank will not accept any currency for exchange except its own. So different countries will peg their currencies against this new currency or allow them to float against it as they see fit. But all crossborder payments will be made in this currency. Once this is in place all countries will pull their investments out of the US financial markets as well as Eurozone. This will start the free fall of the US$ and Euro as the new currency reserves of the Fed and ECB start getting depleted. Once the capital flight ends, the local currencies will stabilise at a rate determined by their imports and exports.

Why would the US elite want to usher in such a currency regime? For one thing the US government's external debt disappears magically. But that is not the biggest advantage. The advantage is that any future external debt will be made with a bank and not with individual countries denying any other country a leverage. Since the bank can be expected to be controlled by the Western elite, the debt can be as large as they please. But most important advanatage of all, since the debt cannot be repaid in the local currency, it is completely delinked from the local economy and only linked to the potential for export surplus. The US economy can go down the toilet without the ability of the government to borrow diminished. Since the local currencies will not be useful outside of the borders, capital transfer will require the consent of the government. Even travel can be restricted without making any laws. Simply by refusing to exchange the local currency for the global one, individuals' movement out of the country can be restricted. Even if some nationalist Americans get control of the US government, they will be firmly under the control of the bank unless they are willing to risk complete economic isolation. Essentially the elite free themselves from the dependence on the economy of any single nation while consolidating their hold on the global economy.

wait till China becomes #1 oil importer and demand oil be traded on their currency. Then its game over
China to become #1 oil importer

reply to post by JiggyPotamus


From what I've read in the Russian and Chinese newspapers, they don't like America at all, but they also speak against Iran's behavior. Both of the above countries, however, have accelerated their armed forces build up including their attack abilities. Russia just built a big brother to the Cold War era Satan missile and is updating their whole ICBM package.

Originally posted by TiM3LoRd
if this is real prepare for a showdown, USA Vs Iran FIGHT!!!

Which station will you be watching the main event on? I haven't yet decided myself but in all seriousness, generally when a country makes that statement, they are invaded shortly after.

Originally posted by FOXMULDER147
Why would Russia - or anyone - want to buy the Rial right now?

Mainly because of the consequences induced by america's messed up foreign policies. You can only dictate the world for so long until everyone else gets fed up with what they are doing.

It's probably because of the "Do as we say, not as we do" attitude. Nations are starting to see that if you trade in US dollars... when you do one little thing the US does not like it will sanction you, and destroy your economy and seizing any assets which are stored in american banks (US dollar). By completely avoiding the US dollar and wandering to a mix of other currencies, you have a safeguard in place.

Just look at Libya for example, the amount of money stolen by american banks from the people of Libya.... and all because it was stored in the form of the US dollar.

Don't get me wrong, i love america. I just cannot stand the idiots who represent it (mcdonalds, bankers, politicians).

Good move for russia in the long term.

Well...we've seen this song and dance before, folks. Looks like military action is inevitable at this point unfortunately. Part of me still hopes that my kids won't have to grow up in a country that's in a constant state of war, but sadly i don't think that will ever be the case...

After Saudi Arabia's succesful attack on the US on 9-11 they booted the US military out of their country AND....

The Saudi Riyal is no longer plugged to the US dollar. 2007 they announced they weren't accepting US dollars anymore for oil.

But heh....Iran unplugged from the dollar so lets kill them instead. They're easier to take out than those smart Saudi's.

reply to post by Magnificient

That might not be a very reliable news source. There was no Russian statement in any other newspaper that I read and that includes a Russian English language newspaper. It appears that their source is wholly based upon something Iran said. Iran earlier said that Russia had made a huge oil deal with them, but the next day Russia denied it.

Correct. According to RAI-Novosti, the Iranians made the proposal back in 2008. There has been nothing but talk since.

en.rian.ru...

Given that the current Iranian government cannot guarantee that they will be around to back up their currency, it would be foolish to accept it in exchange. The Russians aren't fools. Yet another desperate lie from PRESS-TV.