The End Of The Petrodollar
The Saudis, New Chapter in Energy Economics, De-dollarization, and the American-Made Pressure Cooker
“Oil is too important a commodity to be left in the hands of the Arabs.”
~ Henry Kissinger
Just last Sunday, one of the most significant economic deals of the century came to an end. The long-standing petrodollar agreement between Saudi Arabia and the United States officially expired on June 9th, 2024.
This system, which has been in place for 50 years, is now gone.
Despite what the mainstream media might have you believe, yes, it does point to a big change in global economics, and yes, it could seriously affect every American’s life.
So this week, I want to break down exactly what’s happening, why it’s happening, and how it will impact us and generations to come.
But first, let’s set the stage with some context, because it’s crucial…
"Rise" of the Dollar
You’ve probably heard the saying, “The one with the gold makes the rules,” right?
This was the position the U.S. was in after World War II.
The U.S. had won the war and boasted the world’s largest gold reserves. This allowed it to reshape the global monetary system around the dollar.
The new system, created at the Bretton Woods Conference in 1944, tied almost every nation’s currency to the U.S. dollar at a fixed rate. It also pegged the U.S. dollar to gold at a fixed rate of $35 an ounce.
This arrangement made the U.S. dollar the world’s premier reserve currency, effectively forcing other countries to hold dollars for trade or redeem them with the U.S. for gold.
But, by the late ’60s, splurging on welfare and the Vietnam War, along with printing money to cover the deficit, pumped tons more dollars into circulation compared to the gold reserves backing them.
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