Mike, It is not like US will implode, it can still largely maintain prices on domestic products. Imports will however effect price levels and domestic production that use large amounts of energy, will have to correct pricing. Since US is importing a lot of the energy use and also that the domestic energy production will follow the world markets, it is a much that will be effected. The US export will be effected positively and offset some of the negatives as a nation, but the average Joe will see this as negative and lowering of living standard.
US will see a rush to buy US properties, companies and corporations by foreigners, which will be cheap and a way to use the large $ holdings. This will be a circus and US will try, within the limits, to stop this owner shifts. If they do nothing, it will be bad and if they do too much, it will be worse for the possibility of future recuperation. US will not afford any more Iraq adventures and have to get out of the existing ones as soon as possible, to stop bleeding. It will lose its international standing and will not be trusted for a couple of generations. This will also put US at the same level as several South American countries. The damages to the national pride, will be far larger than the actual national economic damages. EU will be the worlds economic super power, followed by Russia and China. You will see effects like the depression in the 30's and a lot of suicides, as it was then. You will also see a lot of price regulation on domestic produce. Hakan At 16:19 30/05/2006, you wrote: >Joe Street asks, Is there anything we at home can do to help speed >this process? :) >I suggest: Implore your Federal representatives to continue raising >the debt ceiling, to continue supporting the war in Iraq and >Afghanistan, to start another war in Iran, etc etc. Or better, >don't waste your time. Instead, I ask you, Joe, and the List, how >do you believe the average "Joe" should prepare for the inevitable >demise of the US dollar??? I'm not trying to be facetious. I'm >asking a real question, seeking a real answer. Might not like the >answer, but I'd like to hear. Also, Keith, how will Japan be >affected? Japan is one of the largest holders of US Debt. Mike DuPree > >----- Original Message ----- >From: "Joe Street" ><<mailto:[EMAIL PROTECTED]>[EMAIL PROTECTED]> >To: <<mailto:biofuel@sustainablelists.org>biofuel@sustainablelists.org> >Sent: Tuesday, May 30, 2006 8:29 AM >Subject: [SPAMPROB:51%] Re: [Biofuel] threat to U.S. dollar > > > Is there anything we at home can do to help speed this process? :) > > > > Joe > > > > AltEnergyNetwork wrote: > > > >> > >> < > <http://www.vheadline.com/readnews.asp?id=58951>http://www.vheadline.com/readnews.asp?id=58951 > > > > >> > >> > >> Threat against the US$ comes from countries such as Iran > >> and Venezuela... > >> > >> Former Nordland University (Norway) associate professor, > >> Dr. Abbas Bakhtiar writes: On Wednesday, May 17, the > >> Dow Jones plunged 214 points to 11,206 -- its worst point > >> drop since March 2003. The downward trend started a week > >> ago and is a warning sign of troubles ahead. This sudden > >> drop has come as a complete surprise to the unfortunate > >> small investors and speculators. The so called "experts" > >> point at the sudden threat of inflation as the main cause > >> of the recent reversals in the markets. > >> > >> What is actually surprising is the surprise of the > >> "experts." A cursory look at the United States' finances > >> will reveal the amount of pressure that its economy is > >> under. > >> > >> When Bush became president in 2001, the United States' > >> public debt was 5.8 trillion dollars. Today the public > >> debt stands at US$8.3 trillion. Of this over $2.2 > >> trillion are held by foreigners. The United States > >> has a GDP of $12.4 trillion ... this gives the US a > >> Debt/GDP ratio of 66%, placing it in 35th place > >> (out of 113) in the ranking of the Debtor Nations. > >> > >> The current account deficit of over 7% has long passed > >> its danger levels of 4-5%. In 2005 the US government > >> paid $325 billion only in interest payments alone. > >> Then, there are the future obligations such as Medicare, > >> Social Security and government pensions. These obligations > amount to $54 trillion. This huge problem worried the former > Federal Reserve Chairman, Alan Greenspan. He told congress: "As a > nation, we may have already made promises to coming generations of > retirees that we will be unable to fulfil." > >> > >> One would think that this amount of debt would worry the > >> president and the congress ... but apparently it does not. The > United States' Congress recently (March 2006) voted to increase the > Federal debt limit to $9 trillion. Any other nation in similar > circumstances would have had to approach IMF for help. The IMF > would then have forced that nation to cut spending and devalue its > currency ... but US does not need to do this. The US can just print > some more dollars. > >> > >> But how long can this continue before the world loose > >> faith in the greenback, sending it crashing to > >> unimaginable levels. > >> > >> The Asian Lender > >> > >> The Asian countries such as Japan, China and others > >> that hold most of the US debts have been happy to > >> indulge the American deficit spending. This has been > >> a two-way Street, America has kept its market open > >> to their products and they have financed the Americans' > >> spending. > >> > >> The value of US dollar so far has been kept artificially > >> high by Japan, China and oil-exporting countries. > >> These countries by buying US debts have has kept > >> interests rates relatively low in the United States > >> and allowed Americans to keep spending even as their > >> debts mount. > >> > >> But there is only so much risk these lenders > >> (Asian and oil-exporting countries) are willing to > >> take. Any serious devaluation of the US$ will > >> considerably reduce the value of their national > >> reserves (mostly kept in dollars) and the value > >> of their debt holdings (certificates, bonds, etc.). > >> At the same time, the devaluation will affect their > >> exports to the US. > >> > >> A weaker dollar makes their products more expensive > >> in US, thereby reducing their export earnings. > >> Most Asian countries keep up to 70% of their reserves > >> in dollars. China with the reserves of over $800 billion > >> has already begun to slowly reduce its dependency on > >> dollars by converting part of its reserves to other > >> currencies. > >> > >> If other Asian countries -- with their vast dollar > >> holdings -- follow suit, then it will be disastrous > >> for the value of dollar. Nobody is interested in > >> holding a weakening currency. > >> > >> Petro-Dollar > >> > >> Another threat against the dollar comes from countries > >> such as Iran and Venezuela. > >> > >> Iran recently registered an Oil Bourse to compete with > >> Bourses in New York and London. The threat comes from > >> the currency in which the oil is to be sold in Euro. > >> Iranians are going to make the Euro the standard > >> currency for oil transactions. Some sympathetic > >> countries such as Venezuela and others may join in. > >> If the Iranians succeed in this, the pressure on > >> dollar will be catastrophic. Nearly every country > >> has to hold a certain amount of dollars in reserve > >> for oil purchases. > >> > >> If the dollar continues to weaken in value, and there > >> is the possibility of purchasing oil in Euro, then > >> these countries would unload their dollars for safer > >> currencies such as Euro. > >> > >> What will then happen to the value of dollar? > >> > >> Iraq and Iran > >> > >> As though there is not enough pressure on the dollar, > >> the US government keeps spending money in an un-winnable > >> war in Iraq and is considering starting another one in > >> Iran. The total cost of Iraq war, including the future > >> payment to the disabled soldiers, replacement of > >> equipment, etc., is estimated be between $1-2 trillion. > >> > >> Any attack on Iran will substantially increase this > >> cost ... even if there is no attack, the tense > >> situation in the region will keep the oil prices > >> at uncomfortable levels, contributing to both a > >> reduction in US growth and an increase in its > >> deficit. > >> > >> Conclusion > >> > >> The current American deficit and its long-term financial > >> obligations, if goes un-answered, will sooner or later > >> lead to either a marked increase in interest rate or a > >> substantial devaluation of dollar. > >> > >> On the one hand, a substantial increase in interest rates > >> will lead to a major recession in USA which will be felt > >> immediately around the world. > >> > >> On the other hand, a substantial devaluation will cause > >> financial chaos in the world. > >> > >> What is needed is to seriously reconsider the international > >> role of the dollar as the world currency ... in other > >> words we need a new Bretton Woods Agreement. > >> > >> At the end of the WWII, 45 nations gathered at a United > >> Nations Monetary & Financial Conference in Bretton > >> Woods, New Hampshire to address the problems of > >> reconstruction, monetary stability and exchange > >> rates. The delegates agreed to establish an > >> international monetary system of convertible > >> currencies, fixed exchange rates and free trade. > >> To facilitate these objectives the delegates agreed > >> to create two international institutes: the > >> International Monetary Fund (IMF) and the International > >> Bank for Reconstruction & Development (the World Bank). > >> An initial loan of $250 million to France in 1947 was > >> the World Bank's first act. > >> > >> Since then there has already been considerable criticism > >> of the roles of IMF and the World Bank. The above > >> mentioned problems and the ongoing trade imbalance > >> in the world have to be addressed by a similar gathering. > >> > >> Sooner or later, both the United States and the rest > >> of the world have to address the existing problems. > >> > >> This problem is not United States alone. > >> > >> We can not ignore the largest economy on earth ... it > >> is said that if United States sneezes, the world catches > >> cold. > >> We have to either make sure that United States doesn't > >> catch cold or vaccinate ourselves against it. > >> > >> Abbas Bakhtiar > >> > >> > >> Dr. Abbas Bakhtiar is a former associate > >> professor of Norway's Nordland University. > >> He is currently writing a book about the > >> reasons behind the United States involvement > >> in Iraq and Iran. > >> > >> > >> > >> > >> Venezuelan president Chavez pledges energy loans to Bolivia > >> > >> < > <http://www.alternate-energy.net/N/news.php?detail=n1148814738.news>http://www.alternate-energy.net/N/news.php?detail=n1148814738.news > > > > >> > >> > >> > >> > >> Get your daily alternative energy news > >> > >> Alternate Energy Resource Network > >> 1000+ news sources-resources > >> updated daily > >> > >> <http://www.alternate-energy.net>http://www.alternate-energy.net > >> > >> > >> > >> > >> > >> > >> Next Generation Grid > >> > <http://groups.yahoo.com/group/next_generation_grid/>http://groups.yahoo.com/group/next_generation_grid/ > >> > >> > >> Tomorrow-energy > >> > <http://groups.yahoo.com/group/tomorrow-energy/>http://groups.yahoo.com/group/tomorrow-energy/ > >> > >> > >> Alternative Energy Politics > >> > <http://groups.yahoo.com/group/Alternative_Energy_Politics/>http://groups.yahoo.com/group/Alternative_Energy_Politics/ > >> > >> _______________________________________________ > >> Biofuel mailing list > >> <mailto:Biofuel@sustainablelists.org>Biofuel@sustainablelists.org > >> http://sustainablelists.org/mailman/listinfo/biofuel_sustainablelists.org > >> > >> Biofuel at Journey to Forever: > >> > <http://journeytoforever.org/biofuel.html>http://journeytoforever.org/biofuel.html > >> > >> Search the combined Biofuel and Biofuels-biz list archives > (50,000 messages): > >> > <http://www.mail-archive.com/biofuel@sustainablelists.org/>http://www.mail-archive.com/biofuel@sustainablelists.org/ > >> > >> > >> > > > > > > _______________________________________________ > > Biofuel mailing list > > <mailto:Biofuel@sustainablelists.org>Biofuel@sustainablelists.org > > http://sustainablelists.org/mailman/listinfo/biofuel_sustainablelists.org > > > > Biofuel at Journey to Forever: > > > <http://journeytoforever.org/biofuel.html>http://journeytoforever.org/biofuel.html > > > > Search the combined Biofuel and Biofuels-biz list archives > (50,000 messages): > > > <http://www.mail-archive.com/biofuel@sustainablelists.org/>http://www.mail-archive.com/biofuel@sustainablelists.org/ > > > > > > >_______________________________________________ >Biofuel mailing list >Biofuel@sustainablelists.org >http://sustainablelists.org/mailman/listinfo/biofuel_sustainablelists.org > >Biofuel at Journey to Forever: >http://journeytoforever.org/biofuel.html > >Search the combined Biofuel and Biofuels-biz list archives (50,000 messages): >http://www.mail-archive.com/biofuel@sustainablelists.org/ _______________________________________________ Biofuel mailing list Biofuel@sustainablelists.org http://sustainablelists.org/mailman/listinfo/biofuel_sustainablelists.org Biofuel at Journey to Forever: http://journeytoforever.org/biofuel.html Search the combined Biofuel and Biofuels-biz list archives (50,000 messages): http://www.mail-archive.com/biofuel@sustainablelists.org/
