The demise of the dollar

Iraq's Saddam Hussein was waged war on, hunted down, and hung for attempting to sell oil in denominations other than US dollars. ...
Saddam Hussein switched from US Petro dollars in 2000 to the

Euro,

Iraq nets handsome profit by dumping dollar for euro
A bizarre political statement by Saddam Hussein has earned Iraq a windfall of hundreds of million of euros. In October 2000 Iraq insisted on dumping the US dollar - 'the currency of the enemy' - for the more multilateral euro.

Source: Guardian UK
Exclusive report by Robert Fisk
In a graphic illustration of the new world order, Arab states have launched secret moves with China, Russia and France to stop using the US currency for oil trading
Dollar Collapse Warning

In the most profound financial change in recent Middle East history, Gulf Arabs are planning – along with China, Russia, Japan and France – to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.
Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.
The plans, confirmed to The Independent by both Gulf Arab and Chinese banking sources in Hong Kong, may help to explain the sudden rise in gold prices, but it also augurs an extraordinary transition from dollar markets within nine years.
The Americans, who are aware the meetings have taken place – although they have not discovered the details – are sure to fight this international cabal which will include hitherto loyal allies Japan and the Gulf Arabs. Against the background to these currency meetings, Sun Bigan, China's former special envoy to the Middle East, has warned there is a risk of deepening divisions between China and the US over influence and oil in the Middle East. "Bilateral quarrels and clashes are unavoidable," he told the Asia and Africa Review. "We cannot lower vigilance against hostility in the Middle East over energy interests and security." LinkHere

The end of the dollar spells the rise of a new order
This radical proposal is a reflection of a changing economic world

Last autumn's global financial crisis set off an economic earthquake. And we are still feeling the tremors. The latest sign of the ground shifting beneath our feet is our report today of plans by Gulf states, China, Russia, France and Japan to end their practice of conducting oil deals in US dollars, switching instead to a diverse basket of currencies.
It is not hard to see the motivation for oil exporters to move away from the dollar. The value of the US currency has fallen sharply since last year's meltdown. And fears are growing, in the light of a spiralling US government deficit, that a further depreciation is likely. They do not want to sell their wares in return for a currency with an uncertain future.
It is also easy to see why China would like a world trading system that is underpinned by other currencies as well as the dollar. For the past decade Beijing has been recycling the proceeds of its giant national trade surplus into purchases of US government bonds and other dollar-denominated assets. China too stands to make a significant loss if the value of the dollar falls. For China, however, the timing is much more sensitive. Beijing needs to reduce its dollar holdings, but if it does so too quickly it will bring about the very devaluation it fears. This explains why Chinese officials appear to want this transition to take place gradually over the next decade.
But the significance of this development goes much further. Since the end of the Second World War the dollar has been the bedrock of world trade. The pre-eminence of the American currency flowed naturally from the economic dominance of the US. Virtually everyone traded with America so it made sense to use their currency.
But the US is not the dominant power that it once was. The financial crisis has left it hobbled with significant government and household debts and sharply reduced prospects for growth. Developing nations such as China, Brazil and India, on the other hand, have weathered the economic storm significantly better. So while this latest proposal is born of financial calculation, it is also a reflection of a new economic world order. LinkHere

Saudi central bank: report on replacing dollar is wrong

Source: Reuters
ISTANBUL (Reuters) - A newspaper report that Gulf Arab states are in secret talks to replace the U.S. dollar in the trading of oil is wrong, Saudi Arabia's central bank chief said on Tuesday.
Asked by reporters about the story in Britain's The Independent, Muhammad al-Jasser said: "Absolutely incorrect."
Asked whether Saudi Arabia was in such talks, he replied: "Absolutely not."
Asked whether Saudi Arabia was committed to the dollar, he said: "You asked the question, I answered it. You asked about the story." LinkHere

Dollar trims losses after UK media report denial

Tue Oct 6, 2009 2:59am EDT
LONDON, Oct 6 (Reuters) - The dollar jumped across the board on Tuesday, trimming losses after Saudi and Russian authorities denied a media report saying Gulf Arab states were considering using currencies other than the dollar to trade oil.
The euro EUR= slipped to around $1.4705 compared with around $1.4730 before the comments .
Still, the pair traded 0.4 percent higher on the day, after traders initially sold the U.S. currency in reaction to the report in the UK's Independent newspaper.
The dollar index .DXY jumped to around 76.445 from around 76.3 before the comments. LinkHere