Why are we Demonizing Iran?
Perhaps the same concern that the US held when it looked as if Iraq was considering trading oil
in Euros (see The Euro Effect: The Real Reason for the War in Iraq
) is the big reason Iran is in our invading spotlights.
This was announced quietly:
On March 23, 2006, the Board of Governors of the Federal Reserve System will cease publication of the M3 monetary aggregate. The Board will also cease publishing the following components: large-denomination time deposits, repurchase agreements (RPs), and Eurodollars.
From Flogging the Simian, whose entire post you should go read right now
In June 2004, Iran announced it was creating an oil bourse. The word "bourse" is a French word which means "exchange" and refers to an international market exchange where oil can be traded. Currently the only two oil bourses are in London and New York.
Should Iran's oil bourse be successful and sales be denominated in Euros, this will induce hedging of the Euro versus the dollar and fundamentally alter the prices of oil.
So, as soj writes
..."the Fed wants to stop printing the statistics of how many dollars are being held overseas precisely when those amounts may go down dramatically."
...) Of course most of the (US) saber-rattling is over Iran's nuclear program and the word "bourse" is never mentioned. But the IAEA has consistently stated that Iran is in full compliance with its regulations and the conditions of the Nuclear Non-Proliferation Treaty. That doesn't negate Iran's political alignment and support for terrorism, but their nuclear energy program is hardly the threat it's made out to be.
All I can say is it hurts to think about and I hope what I'm thinking is completely wrong. I think I know better than to hope
posted by Cyndy