|| From: Thomas Seay
||
||
|| Two questions:
||
|| If the United States had pulled out of the Vietnam War
|| earlier, thus in some measure slowing the flight of
|| the dollar, would this have, at least, been enough to
|| delay the eventual closing of the gold window that
|| took place?
||
|| Why, when OPEC raised the price of oil to $12/barrel
|| in 1973, did they require payment to be made in
|| dollars?
||
|| Thomas
||
I'll let someone else do the maths for your #1, as for #2:
Doesn't it strike you as odder still that OPEC didn't raise the price of oil one red cent between 1960 and 1970? The reason is simply that the Gulf states and principally Saudi Arabia are US clients. They get leaned on heavily. When oil prices are in dollars, the US can just print the money it needs to buy the stuff. Additionally, greenbacks from all over the world accumulate in sheiks' accounts, ready to be recycled as US T-bills and arms purchases. Additionally, oil sales support the value of the dollar - so that may also answer your question about Bretton Woods (who needs a gold standard when you can have an oil standard, and the oil isn't even yours?). So what do the sheiks get from the US? Protection, as in racket. Read more here:
[OPE-L:6031] hidden hand of american hegemony: petrodollar recycling and international market (Rakesh Bandari) http://ricardo.ecn.wfu.edu/~cottrell/OPE/archive/0110/0001.html
Hakki