Alan Greenspan claims Iraq war was really for oil

[jordanz]

It is the main commodity in the world.

Yes, but it only represents 2%-6% of the world GDP (depending on the price of oil).

If you have to have dollars to buy oil and oil is in high demand, then that raises the demand and the value of dollars. This also forced all of the OPEC countries to hold their reserves in dollars

But what do they do with those dollars? They buy T-Bills or other goods/services denominated in dollars.

Now if Iraq, Iran, Lybia and Venezuela all decide to no longer accept the dollar for oil but euros instead, demand for the dollar goes down, and the value of dollars goes down.

But it only goes down for ~4% of the world economy. People buying oil in the US only have dollars so they have to convert those dollars to Euros. The people who buy those dollars will have to spend those dollars in the US (via T-Bills or goods/services) completing the circle. The net effect is zero. If the only thing ever traded was oil, I'd agree with you.

Also since these countries are going to be spending their dollars and replacing their reserves with euros, more dollars will become active in the market place, increasing the supply (and with the demand going down due to less oil being sold in dollars) further decreasing the value of the dollar.

The supply of dollars does not change by these kinds of transactions. The only entity that can create new dollars is the US government.

What do you think the whole fight with Iran is about.

The fact that their leaders are insane and are building nuclear weapons. They are supporting and fomenting terror directed at the US and its allies around the world.

Do you really think we attacked Iraq because they were a threat?

I think that that's one of the reasons. Another reason is that Iraq was "doable". Paul Wolfowitz and other neo-cons have spoken a great deal about this.

They had no weapons and no army, and were not working with terrorist.

This is false. Hyperbole doesn't help your argument.

Iran is also not a threat to us, they also don't have weapons, and have no way of attacking us, and are not working with al-qeada.

Wow - this is radically different from reality as I perceive it.

[tjohnson]

It is the main commodity in the world.

Yes, but it only represents 2%-6% of the world GDP (depending on the price of oil).

But a country NEEDS energy to function so this 2-6% is critical. Looking at a statistic like this disguises the relative importance of each commodity. What good is it having food if I can't ship it to market and the people can't get to market to buy it etc.

[Michael Stuart Kelly]

In Brazil, every time gas prices went up (this was determined by the government), the price of everything else followed a few days later. Rarely did indicators show real inflation before a price increase in petroleum products.

Michael

[Aggrad02]

But what do they do with those dollars? They buy T-Bills or other goods/services denominated in dollars.

And what do you think is going to happen to the value of the dollar, if those countries are no longer buying T-Bills? The Federal Government will have to borrow more from the Federal Reserve.

[but it only goes down for ~4% of the world economy. People buying oil in the US only have dollars so they have to convert those dollars to Euros. The people who buy those dollars will have to spend those dollars in the US (via T-Bills or goods/services) completing the circle. The net effect is zero. If the only thing ever traded was oil, I'd agree with you.

Currently the cycle is not completed. There are trillions of dollars that float around used just for oil (hence the name petrodollar). Right now other countries take dollars because they know they can turn around and buy oil with it. If they couldn't buy oil with it, they would stop accepting dollars.

From wikipedia: http://en.wikipedia.org/wiki/Petrodollars

A petrodollar is a U.S. dollar earned by a country through the sale of petroleum. The term was coined by Ibrahim Oweiss, a professor of economics at Georgetown University, in 1973. Oweiss felt there was a need for a word to describe the situation which was occurring in the OPEC countries, balance of trade is largely offset by its role as a reserve currency. Given the general tendency for crude oil prices to rise and become more volatile in recent years, it may even be argued that crude oil trading may, in the long term, be a significant liability for the stability of the currency in which the trade is conducted.

The only entity that can create new dollars is the US government.

Very Very False. The US Government does not create new dollars. The Federal Reserve (which is a private corporation owned by the banks depositing at the Fed, own the Reserve) creates credit. The Fed creates money and then lends it to the Government and other Banks. Every time you take out a loan, you are not being loaned money, but credit created out of thin air. Why do you think banks are so aggressive at trying to get new depositors? Because they can loan out ten times their deposits. For example if you deposit 10,000, they can turn around and make a loan for a 100,000 house. Money has no value, it is just a credit receipt from the Federal Reserve.

The fact that their leaders are insane and are building nuclear weapons. They are supporting and fomenting terror directed at the US and its allies around the world.

1. It has not been proven that they are trying to build weapons

2. Even if they did they have no way to deliver those weapons.

3. Israel would not let them do it.

4. Their leader is not as insane as Fox News makes him out to be

5. Where are they funding terrorism against the US? I think you a thinking about Saudi Arabia, our oil buddy.

6. When you say allies, you mean Israel. Israel can take care of itself.

Another reason is that Iraq was "doable".

So are supporting Imperialism? The idea that we should kick around who ever we want because we can. Try telling that to the 5,000 families that have lost their sons, daughter, wives and husbands for oil and because it was doable.

They had no weapons and no army, and were not working with terrorist.

This is false. Hyperbole doesn't help your argument.

Do some research. Saddam had no WMD's, no viable army and was not working with terrorist. You can stay in denial and keep drinking the blood red Bush kool aid if you want.

Iran is also not a threat to us, they also don't have weapons, and have no way of attacking us, and are not working with al-qeada.

Wow - this is radically different from reality as I perceive it.

Once again please explain how a primitive third world country who is not working with al-qeada is a threat to us. They cannot invade our county and they have no desire to attack us (Israel is a different story). They just want us to leave the middle east alone.

--Dustan

[Michael Stuart Kelly]

Once again please explain how a primitive third world country who is not working with al-qeada is a threat to us.

Dustan,

Oil?

(Sorry, I couldn't resist.)

Michael

[jordanz]

FYI - I saw Greenspan on CNBC last night being interviewed by Maria Bartiromo. He said that he was being misunderstood. His point was that Saddam had control of the Straits of Hermus. He said nothing about Dollars. I guess Saddam could've pulled a Doctor Evil and demanded some kind of ransom in exchange for not blocking oil out of the gulf.

[jordanz]

The only entity that can create new dollars is the US government.

The Federal Reserve (which is a private corporation owned by the banks depositing at the Fed, own the Reserve) creates credit.

I view this is a semantic difference. The Fed, as I see it, is part of the government. Regardless, it appears that you and I agree on this one.

Edited September 18, 2007 by jordanz

[Aggrad02]

I view this is a semantic difference. The Fed, as I see it, is part of the government. Regardless, it appears that you and I agree on this one.

If that is what you meant, its cool. Just remember that the Fed is private, just highly regulated.

--Dustan

[jordanz]

FYI - I've moved the issues not related to Greenspan/money to a new topic: http://www.objectivistliving.com/forums/in...?showtopic=4587

[jordanz]

Just remember that the Fed is private, just highly regulated.

As private as the US Post Office, I guess ;)

[Michael Stuart Kelly]

The role, reality and status of the Federal Reserve is pretty well described in the videos and articles linked in this post (and thread).

Michael

[John Dailey]

~ Question:

~ What does 'private' mean, nowadays? I mean...meaningfully...not just dictionarily. Ie: 'usefully'.

~ 'SfarasIcansee, knowing all the ways to 'invade' it, and thence, applying that knowledge to guarding your self's 'privacy' is the ONLY way to make one's life (or specific aspects of it) 'private.'

~ Not knowing such, means...guess what? Your life is...nowadays...an 'open book', for those in-the-know...of Googling. (Magnum: whine your heart out; you're passe.)

~ 'Some' one is watching (for whatever Hannibal Lecter or Executive Decision 'reasons') l'il ol' *you*... :fear:

~ Hooomherhawra-ha-ha-ha!

~ 'Galt's Gulch' anybody (re-located, for sure)?

LLAP

J:D

[John Dailey]

~ Re this 'oil' concern, methinks too many are thinking in terms of the US (aka 'we') attempting to CONTROL the oil sources...

...and too few are concerned with, maybe, JUST m-a-y-b-e...we're trying to PREVENT 'control' from falling into extortionists' hands.

~ To be sure: for A to prevent 'control' by B, A MUST 'control' it.

~ Yes: there's conflict on who 'controls' it. 'We' should...bow out on this? Leaving it to whom...for us to sovereignly recognize ('UN'-wise; how else?)...to 'control' it?

~ Yes, 'It's about oil'! Who want's random non-'UN' recognized groups like Al-Quaida to control it? Who wants extortionists to control it? Who wants 'U.S.' to NOT 'control' it? Well, haters of the U.S. for one.

~ Hello?

LLAP

J:D

Edited September 19, 2007 by John Dailey

[Michael Stuart Kelly]

John,

Your thoughts are true, but not complete. There is also the issue of gobs and gobs and gobs and gobs of money to be had with government-managed oil contracts (especially those juicy monopolies). Tell me that blind greed is not a factor. Do Americans come from a different planet than the rest of humanity?

Free market means free. No government involved in the economic part. Government ownership and/or economic control is socialism.

Michael

[Brant Gaede]

John,

Your thoughts are true, but not complete. There is also the issue of gobs and gobs and gobs and gobs of money to be had with government-managed oil contracts (especially those juicy monopolies). Tell me that blind greed is not a factor. Do Americans come from a different planet than the rest of humanity?

Free market means free. No government involved in the economic part. Government ownership and/or economic control is socialism.

Michael

Does this mean that when foreign governments take over local operations of American oil companies we let 'em have it?

--Brant

[Michael Stuart Kelly]

No.

[SaulOhio]

Alan Greenspan's comments on the subject are far from a claim that the US governemnt, or Bush specifically, wanted to "plunder" mid-east oil.

Given that, "I'm saying taking Saddam out was essential," he said. But he added that he was not implying that the war was an oil grab.

"No, no, no," he said. Getting rid of Hussein achieved the purpose of "making certain that the existing system [of oil markets] continues to work, frankly, until we find other [energy supplies], which ultimately we will."

On the contrary, it seemed to be a move to protect the oil from being plundered by Hussein. He had already torched the Kuwait oil fields. Greenspan hints that Hussein had intentions to control more oil resources, that he was the one who had some intention to do the plundering.

[Michael Stuart Kelly]

SaulOhio,

Are you arguing against someone or are you just making a general point? For the record, no one so far has claimed that Greenspan said "that the US governemnt, or Bush specifically, wanted to 'plunder' mid-east oil."

Michael

[Neil Parille]

I haven't had the chance to stop by a book store and peruse the book. Does he discuss Rand in detail?

[Aggrad02]

John,

Your thoughts are true, but not complete. There is also the issue of gobs and gobs and gobs and gobs of money to be had with government-managed oil contracts (especially those juicy monopolies). Tell me that blind greed is not a factor. Do Americans come from a different planet than the rest of humanity?

Free market means free. No government involved in the economic part. Government ownership and/or economic control is socialism.

Michael

Does this mean that when foreign governments take over local operations of American oil companies we let 'em have it?

--Brant

It is not our responsibility to control what happens in another country. If an American company decided to do business in another country they have to be ready to play by the rules of that country and accept any consequences that follow.

--Dustan

[Aggrad02]

I haven't had the chance to stop by a book store and peruse the book. Does he discuss Rand in detail?

He wrote four pages about his relationship to her and how it had a profound effect on his mental process, and had a couple of quotes throughout regarding her, but not too much.

[John Dailey]

Mike:

~ Re your post # 39, I will NOT tell you "...that blind greed is not a factor."

~ I will tell you that, given what I argued as important 'factors', your concern is an IRRELEVENT 'factor.'

~ You say that "Free market means...No govt involved in the economic part." Including the idea that govt is NOT necessary to (ahem) PROTECT that market from being purposefully skewed by (what shall we say here...'anarchic') controllers? -- You used the word 'involved'; that's a pretty broad-meaning word.

~ You say that "Govt ownership and/or economic control is socialism." --- That word 'control' is really just as broad. So, does the idea of govt 'custodianship' (ie: keeping out 'control' by OTHER govts/gangs) imply economic-control? I think not, and that's all I'm arguing for re the relevency of *our* govt 'controlling' such.

LLAP

J:D

[John Dailey]

Mike:

~ You answered Brant's question with a clear, unequivocal (don't see that much in these discussions!) "No."

~ "Ok, Johnny; WHY don't you?" (aka: just what DID you mean?)

LLAP

J:D

Edited September 20, 2007 by John Dailey

[John Dailey]

Aggrad:

~ You say...

It is not our responsibilty to control what happens in another country.

~ If we have no citizens of *ours* there, true. Otherwise, this absolutist view is way off; we have a responsibility to our citizens re how they're treated there.

~ You say...

If an American company [can we add 'person' here?] decided to do business in another country they have to be ready to play by the rules of that country and accept any consequences that follow.

~ As absolutistically asserted, without 'caveats', there's no reason a rational person/company would/could accept this. If the 'other' country/group is not decreed by our own govt/country as a threat, then, if a citizen person gets outside-of-our-country protection (such as within 'treaties') by our govt of what our govt recognizes as their rights, in dealing with said group/govt, *we* have a responsibility there.

~ Outside of all that (including companies 'doing buisness' unilaterally), I agree.

LLAP

J:D

[Michael Stuart Kelly]

~ Re your post # 39, I will NOT tell you "...that blind greed is not a factor."

~ I will tell you that, given what I argued as important 'factors', your concern is an IRRELEVENT 'factor.'

John,

Ya think so?

I have been in some really high-level government meetings, admittedly in Brazil. Greed was never mentioned, but boy was it relevant!

When I was there, I used to harbor a fantasy that Americans were somehow essentially different about these matters. Since I have been back, all I have seen is more of the same. So I have no reason at all to think that greed would not be a relevant factor.

The real difference here is not in the quality of USA politicians. Politicians are politicians and greed comes with the territory. The difference is in the restraints put on them by the wonderful system dreamed up by our founding fathers.

Michael