I have said it a thousand times on this blog. Pumping excessive currency into the money supply results in a devalued currency.

Well, this is the fall out from our President pumping currency into the money supply. Now those who trade oil want to stop using the dollar as their currency.

The Story Via the U.K. Independent:

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.”

Ron Paul, of whom I have some disagreements on Foreign policy, has said since he was running for President and even prior to that; that what we are doing to our Economy is the moral equivalent of economic Jones-town massacre mass suicide —- and it turns out that the man was and still is absolutely correct.

Of course, the oil traders are denying that this is taking place; but of course! The last thing that they want is a mass panic by market investors!

Via Fox News:

The world’s oil producers will continue using the U.S. dollar as the currency for buying and selling crude, high-ranking oil and finance officials in the Gulf said on Tuesday, denying a report in a British newspaper.

Earlier, The Independent reported that Gulf Arab states, as well as China, Russia, Japan and France, are in secret talks to end the use of the U.S. dollar to trade oil, causing the American currency to fall in overseas trading Tuesday.

Qatar’s oil minister, Kuwait’s finance minister and sources in the United Arab Emirates and Saudi central banks all denied the report.

The Independent report is “absolutely incorrect” and there has been “absolutely nothing” of that nature discussed between Saudi Arabia, the world’s biggest oil exporter, and other countries, Saudi Central Bank Governor Muhammad al-Jasser told reporters in Istanbul.

We did not discuss this at all,” Russia’s deputy finance minister Dmitry Pankin said on the sidelines of International Monetary Fund meeting.

The newspaper report said, “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.”

Lew Rockwell‘s Reaction to the story was not entirely surprising at all:

Though conservatives call this important story “Arabs Plot to Drop the Dollar,” it’s simply self-defense. Or are other peoples just supposed to be kicked in the teeth by the Fed and like it? China, Russia, Japan, France, and Gulf Arab states seek to substitute for the dollar in oil transactions a basket of currencies including the yen, the yuan, the euro, and gold. Heroic. I’d like to use that myself. In fact, why isn’t the Fed’s crazed monetary expansion called a plot to harm others and regular Americans, to the benefit of the US state and its bankster and corporate allies? And if it does indicate another step in “The Demise of the Dollar,” all the fault is in Washington, DC–as usual.

UPDATE From Ryan Cowles:

In light of this, see Ron Paul’s 2006 article on Dollar Hegemony

I could not have said it better myself. 🙂

A funny reaction from Vinnie over at the Jawa Report:

Oh well, I’m good. It takes me 3 minutes to drive to work in traffic. If they go off the dollar in the Scotch industry though, I’m taking up arms.

Heh. In my case, if they go off the dollar in steaks or in coffee; it’s on baby. You can ream my butt for Gas… Hell, I usually just put in five or so bucks to get me around town. Considering the fact, that I drive a piece of crap clunker. But we start fiddling around with my caffeine jolt, or my monthly or so splurge on a good steak; there will be war.

Sammy over at Yid with A Lid quips:

But wait a second this cant happen, don’t they know that Barack Obama is our president, they love him.

Yeah, They love him alright; with that knife behind their backs. If ol’ Big “O” thinks because he’s black and got a funny middle name, is going to stop the Arab Nations from royally screwing America. The President has another thing coming. The Arab nations have hated us; for taking their resources for decades, that goes back to before the President; and myself for that matter, were even born. So, the socialist liberals cannot scream BOOOOSH on this one. This even predates him too.

William Jacobson over at Legal Insurrection writes:

I would like to think someone in the Obama administration would be concerned, but honest reflection leads only to the conclusion that the lowering of U.S. international power will be music to Obama’s ears. He never misses an opportunity to lecture the world about the evils of domination by any one country, by which he means the United States.

A fiddler who is not oblivious to the fire, by any means.

So true, I mean, I have followed politics with some sort of interest since I started voting when I was 18 and I never, ever heard a President apologize for America, Ever. In another time period, President Obama would have been impeached for treason for saying something like that in another Country. But in this day of socialistic rule; nothing happens at all.

I guess time will tell on this one; if it happens, the results will be devastating to our economy. Let us home, for the sake of America, that this is nothing more than poorly sourced rumor story.

The Round Up: Fox News, The Moderate Voice, Guardian, Left Coast Rebel, Credit Writedowns, naked capitalism, Another Black Conservative, ParaPundit, Mish’s Global Economic …, YID With LID, RedState, Townhall.com, The Jawa Report, Le·gal In·sur·rec· tion and LewRockwell.com Blog (via Memeorandum)