Muckracker Report TeamLiberty.net November 10th 2005

Oil, that bubbling crude, Black Gold, Texas Tea; no matter which country's buying or selling it, all oil purchases around the globe are made with U. S. dollars only. The greenback is the international currency of oil-sales, all oil-sales the world over. Since the dollar is the money needed to purchase oil, every country around the globe must hold U. S. dollars. By having to earn or borrow U. S. currency to purchase oil, the value of the dollar is artificially supported because of the demand for oil. Supporting the value of the dollar is vital to the economy of the United States.

If the demand for the dollar overseas would diminish fifty percent, meaning that half of the U. S. currency floating around the globe would no longer be needed by foreign governments, every country and person holding U. S. dollars would quickly experience a fifty percent decrease in their monies purchasing power, or one hundred percent inflation.

As long as the greenback reigns supreme as the international currency for oil purchases, catastrophic economic collapse of the U. S. economy will be prevented. Even as the United States national debt approaches $8 trillion, and despite the fact that for all practical purposes the federal government of the United States has been legally bankrupt since 1933, the U. S. dollar has survived depressions and recessions, bull and bear markets, inflation and deflation, fluctuating interest rates, and every other pressure and strain placed upon it. As with any other commodity, the reason the dollar has weathered the storms of the last seven-two years is directly attributed to demand.

The currency of the United States is fiat money. Fiat money is paper money decreed legal tender, not backed by gold or silver. What that means is that any value the U. S. dollar retains in the United States is the result of the federal government enacting law that says it is legal tender. Legal tender means that the frn/dollar must be accepted in the United States as payment for all debts, public and private. If the people living in the United States lost faith in the dollar and began to defy the legal tender law by only accepting gold coin to pay for debt, the value of the dollar would plummet. If the people persisted and resisted the federal government's certain forceful effort to make people accept the frn/dollar to pay for all debts, the value of the frn/dollar would completely vanish. It would not be worth the paper it's printed on. It would be worth-less.

If people refused the frn/dollar in the United States and started trading in gold coin, the big losers wouldn't be the people, although they would know hardship and lean times. It would be the banking cartel, the Federal Reserve, and the federal government, because it is the borrowing of fiat money from the Federal Reserve that allows the federal government to spend money it doesn't have on things it should not need. The Federal Reserve is sustained by interest paid on fiat money and the global demand for the U. S. frn/dollar resulting from the frn/dollar being the international currency of all oil sales. It's as simple as supply, demand, and interest payments.

Deuteronomy 23:19 Thou shalt not lend upon usury to thy brother; usury of money, usury of victuals, usury of any thing that is lent upon usury: http://jahtruth.net/kofkad.htm

The problem with fiat money is that it creates the welfare state. When money is one hundred percent backed by gold or silver, government cannot spend money it does not have because they cannot print more money unless they have the gold or silver to back it up. Fiat money has allowed the United States to run up a high interest, credit card-like debt of, as previously mentioned, $8 trillion. When the politicians in Washington DC need more money, they simple print it. For each dollar printed without any commodity like gold or silver supporting it, and for each printed while there exists a national debt, the value of all other dollars already in circulation depreciates. Again, it's supply and demand. When the federal government can manipulate the money-supply simply by printing more money, the value of the money in the people's wallets decrease. This decrease in value increases the number of dollars required to make purchases. When this occurs, it's called inflation. Inflation is a hidden tax on the American people. When the politicians in Washington DC continue to spend borrowed money, they are in fact passing a humongous tax onto the people.

So what's this have to do with the price of Texas Tea in Iraq? The background information explaining fiat money and the U. S. frn/dollar is necessary to fully appreciate one of the reasons why I believe the United States invaded Iraq and why we may have little choice than to invade Iran. It is my contention that the War on Terror has some additional elements that are seldom discussed by the mainstream media. Some of the fight has to do with protecting the supremacy of the U. S. dollar as the international currency for oil-sales.

Protesters of the War in Iraq say oil is the reason we invaded that country. The Iraqi people that are now fighting against our troops say we're in their country to steal their oil. Both are wrong. The world's oil supply is stable, despite what big oil would like you to believe. Consequently, there is no need at this time to invade oil-producing countries to steal their oil. Remember, it's supply and demand. No, America is not in Iraq to steal oil. Part of the reason America is in Iraq is to re-establish the U. S. frn/dollar as the only currency accepted to purchase Iraq's oil.

In November 2000, Iraq stopped accepting U. S. dollars for their oil. Counted as a purely political move, Saddam Hussein switched the currency required to purchase Iraqi oil to the Euro. Selling oil through the U. N. Oil for Food Program, Iraq converted all of its U. S. dollars in its U. N. account to the Euro. Shortly thereafter, Iraq converted $10 billion in their U. N. reserve fund to the Euro. By the end of 2000, Iraq had abandoned the U. S. dollar completely.

Two months after the United States invaded Iraq, the Oil for Food Program was ended, the country's accounts were switched back to frn/dollars, and oil began to be sold once again for U. S. dollars. No longer could the world buy oil from Iraq with the Euro. Universal global frn/dollar supremacy was restored. It is interesting to note that the latest recession that the United States endured began and ended within the same timeframe as when Iraq was trading oil for Euros. Whether this is a coincidence or related, the American people may never know.

Today there's a greater threat to dollar supremacy in the global oil market. It is Iran's goal to open their version of the New York Mercantile Index (NYMEX) and London's International Petroleum Exchange (IPE). The NYMEX and IPE are both owned by a U. S. consortium and operated by IntercontinentalExchange, Inc. based in Atlanta, GA. Both the NYMEX and IPE can be described as stock exchanges for oil and other natural resources ­ they're oil exchanges for the world's global oil market. Obviously, both only accept U. S. Dollars/frns.

Iran is projected to launch a third oil exchange in March 2006. They have developed an Iranian petroeuro system for oil trade, which if enacted, would threaten U. S. dollar supremacy far greater than Iraq's euro conversion. Called the Iran Oil Bourse, an exchange that only accepts the euro for oil sales would mean that the entire world could begin purchasing oil from any oil-producing nation with euros instead of dollars. The Iranian plan isn't limited to purchasing one oil-producing country's oil with euros. Their plan will create a global alternative to the U. S. dollar. If opened, the Iran Oil Bourse will further the momentum of OPEC to create an alternate currency for oil purchases worldwide. China, Russia, and the European Union are evaluating the Iranian plan to exchange oil for euros, and giving the plan serious consideration.

If these countries drop the dollar in favor of the euro and support the demise of the U. S. dollar as the international currency for global oil purchasing, America's debt will end in default, the trade deficit will likely double, and the dollars that we carry in our wallets will be worth less, much less then they are right now. In the simplest terms, everything will appear to cost more because the dollar will be worth less.

In theory, the price of goods and services do not go up. It is actually the value of the dollar going down that causes economic insecurity and inflated prices at the cash register. Once the American people understand this important lesson regarding fiat money, change will be demanded in Washington DC.

Whether the United States can thwart Iran's Oil Bourse without military intervention is debatable and remains to be seen. The damage done to the economic security of the United States by both the Democratic and Republican Parties over the last seven decades, their running up a staggering $8 trillion national debt, has weakened the dollar and placed the United States in the precarious position of having to find excuses to invade countries that threaten not America's sovereignty and way of life, but its currency.

This strategy of backing the U. S. Dollar/frn with bullets instead of bullion cannot sustain itself forever. Sooner or later, the American people will be required to pay for their government's out of control spending. When that time comes, the people are going to pay hell trying to do what needs to be done; abolish the Federal Reserve Act of 1913 and 16th Amendment of the Constitution, eliminate the IRS and at least twelve hundred of the fifteen hundred agencies of the federal government while slashing the two million federal employee payroll by fifty percent.

Essentially, the current grip of the two-party juggernaut in Washington DC needs to be broken, the current government needs to be abolished and returned to a constitutional republic, and finally, the dollar has to be returned to the gold standard once and for all. If the American people fail to take these specific actions now, it is likely that in ten years or less, the dollar will be replaced by the euro as legal tender in the United States, and the American people will be subject to direct, global taxation by the United Nations on behalf of the World Bank and International Monetary Fund.

You can now consider yourself forewarned.

Ed Haas is a freelance writer and author originally from Mt. Penn, Pennsylvania. He currently resides in beautiful Mt. Pleasant, South Carolina. To learn more about Ed's work, please visit craftingprose. com.