Anyone know why oil prices are so high? The story goes like this. Back in the 1970s, the US in its genius linked the sale of oil to the US dollar. This move generated (artificial) demand for US dollars, keeping the value of the dollar high relative to other world currencies, generating what might be called an empire tax effectively taxing human productivity worldwide. Heck of a deal, right? Indeed. Until various countries began finding ways around the regime to transact oil in other than US$. Momentum for transacting outside the regime has grown in the past ten years, in line with rising oil prices. See whats happening here? Less relative demand per unit of GDP for US$-oil = less demand for US$ = higher US interest rates = empire-ending trouble. Of course, to justify rising oil prices needed to bridge the gap of falling demand one needs a good cover story. This is where the peak oil lie comes in. Is the world making a little more sense to you now?
Posted on: Mon, 14 Oct 2013 23:00:51 +0000
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