> So some regime in the Middle East falls. So what? Their successors
> would still sell the oil - what else would they do with it? Iran and
> Libya have been selling theirs despite their status as pariahs. They
> could lobby within OPEC to push prices higher, but OPEC controls
> something like 38% of global production - it's doubtful the higher
> prices would stick. Of course PNAC & the Bush admin may think
> otherwise, but they believe a lot of nonsense. I have a hard time
> believing that the invasion of Iraq follows rational capitalist
> calculation. It's something more primitive and irrational.
>
> Doug
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> http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk
>
>
In our post bubble economy, we needed a weaker $ to soften our
inevitable hard landing which could have forced OPEC members to
completely switch over to Euros. Before the Iraq war, the Oil for Food
scam was already using Euros. A complete switch over in the world oil
market would threaten the US economy worse than any 911 style attack.
Our fractional banking system, supported by mountains of debt, would
become unserviceable in a matter of months. Printing more money with a
steeply weakening dollar, would be akin to a snake eating it's own tail.
The Domino Effect, to use a cold war term, no longer refers to spreading Communism, but of a spreading lack of faith in the America's ability to service it's debt (both public and private) and the value of it's underlying fiat currency. Iraq, after some prodding from France and German, was the first tipping Domino. Now Iraq is in the loving hands of the US.
Now, Iraqi oil (like most oil) is redeemed in US $.
US Debt is attractive.
Gas is still relatively cheap.
Democracy is served.