(Untitled)

[archdukechocula]

This article is a rather interesting read, suggesting that the reasons for the war in Iraq are largely tied to the nature of currency valuation of the US dollar. However, I'm not an economist, and have a general inability to seperate truth from potential BS on this particular issue. So, if anyone knows much about the issue, tell me what you think

Comments

War origin theories

[buddhafiddle]

If this was the strategy (and certainly some pro-war forces mentioned this as a factor), it was really ill-advised. Regardless of American ambitions, we have less control of Iraqi monetary policy actions than we did during the sanctions, and will soon have even less. The dollar seems ludicrously over valued, and the slow Democritization of the Gulf, which is happening despite our best efforts, spells doom for any of these deals.

The only theory about why the US invaded Iraq that I ever believed was Scott Ritter's. In a militarily minded, media rich country like Britain or the US, you just can't call a leader the new Adolf Hitler for 20 years and then make deals with him. World pressure was mounting to end sanctions --either by changing the government or making a deal--and domestic politics made the latter course impossible.

Re: War origin theories

[archdukechocula]

Why do you suppose there hasnt been a more rapid sell off of dollars by currency speculators? This suggest to me that I should be investing in the Euro any way you swing it.

Perhaps...

[buddhafiddle]

In the long term, I think you'd be right.

Between 2000 and 2004, I believe the Euro doubled in value against the dollar.

The Euro is risky (or at least seems risky) in a way that the dollar isn't; there isn't a good chance that, say, Florida, will suddenly decide not to recognize dollars and print its own currency again, or that New York will vote not to recognize the US constitution.

I'm speaking mostly ex ano here, not being an economist myself, but I also think the fact that so many of the worlds dollar holdings are in the hands of other countries gives it a kind of abstract value that is unrelated to the strength of the US economy or its trade deficit

[hiphorrific]

Have you ever read Confessions of an Economic Hitman? It basically talks about this very thing from the first person perspective of someone who actively participated in the process. A good, informative read, I thought.