Quote:The euro would challenge the dollar as the world reserve currency, and I dont think the Americans want that.
I don't think the Americans care about that particular aspect. There are $700 billion of cash in circulation, maybe half of which is used as reserves, providing the USA with an interest-free loan of $350 billion. The benefit to the USA of the dollar being the world's reserve currency is the long-term market interest rate on that loan, which stands at about 5 percent. So the benefit computes to 5/100 * $350 billion, or about $18 billions a year.
This sounds like a lot, but it's peanuts compared to America's total income of $10 trillion.
Thanks for that Thomas. You probably know more on this than I do.
Surely the Americans gain much more than just some interest payments? If the whole world needs dollars to function (to buy oil for instance) then it must be quite useful if you control the dollar printing presses.
I can't help but wonder how much Saddam's decision to charge for oil in euros in Nov 2000, influenced Americas decision to invade. Iraq oil is now safely back in dollars of course.
Suppose OPEC countries switched from the dollar to the euro? Wouldn't that be seen as catastrophic in Washington?
It seems to me that the US with its huge economy and massive military does not have to obey the normal laws of economics. e.g (with limits) they can print dollars and buy foreign goods without causing inflation and consequent devaluation of the dollar.
But with so many dollars in circulation surely that must build up inflationary pressures? Doesn't it make sens to waste a trillion or so on a Mars mission, and keep the dollar strong?
I wish I understood this better.
Steve
Steve (as 41oo) wrote: Surely the Americans gain much more than just some interest payments? If the whole world needs dollars to function (to buy oil for instance) then it must be quite useful if you control the dollar printing presses.
No, because your ability to use this control is constrained by the goal of keeping inflation and unemployment in check at the same time. Most of the world wide reserves isn't in dollar bills, but in (interest paying) US government bonds. If a country, say China, switches to European government bonds, America will pay money for the returned bonds, but it will also get to stop paying the Bank of China interest on its bonds. Given that bonds are traded on a competitive market, this is a wash from America's point of view.
Steve (as 41oo) wrote:
But the thing that really worries me is the influence of the USA. For all their warm words about the EU, ...
I believe many Americans have long seen the EU as a good and noble enterprise, at least in principle. However the recent facts of an EU, dominated as it is by the antagonistic (to us) political concepts of France (and to a lesser extent, Germany) alter their views a good deal.
The United States and Britain became close allies in WWI, and have remained so since then. Before that we were, more often than not, antagonists. Both are possibilities in the future. I believe many here see the question of full UK integration in the EU in those terms.
georgeob1 wrote: I believe many here see the question of full UK integration in the EU in those terms.
I suppose, you mena with "here" the USA and not A2K.
But do you mean with "full integration"???
The UK is a full member of the EU - 'full as full can be' - since 1973 (Denmark and Ireland joined that year as well).
Walter,
I meant in the USA, not A2K, as you guessed.
The question of British exceptionalism within Europe has been debated in the UK for some time. I believe it has involved three key questions: (1) the traditional British policy of opposing, or at least standing apart from, whatever power dominated continental Europe, (2) British relations with Commonwealth nations, and (3) British relations with the United States.
I agree that a British decision to fully embrace the EU and the associated European political currents does not, in principle, have to be equivalent to rejecting a long-standing close relationship with the United States. However, sadly, it appears (at least to me, and, I suspect, to most ASmericans) that the principal continental powers have made it so.
Thomas
I'll have to go on a crash course in international finance. But I can't help thinking the normal rules don't apply to the US. America owes the rest of the world a fantastic amount of money, but somehow that debt doesnt matter. They just print more dollars and everyone's happy.
George
Certainly Blair sees it as an "article of faith" that Britain and America should remain the closest of allies. And he also thinks Britain should be the bridge between US and EU. Maybe its possible. But the upside of being the vital link also risks the downside of being ignored in the US and treated with derision in Europe. But maybe Blair is right, we don't have to chose between the two...its a false dichotomy.
I was wondering the other day what American reaction would have been if Britain had sided with France Germany Russia over Iraq. How would W thought of us if Blair had said " look George we were with you in Afghanistan, standing shoulder to shoulder and all that, but Iraq has nothing to do with 911. We can't go along with an attack until the UN process is exhausted and gives it legitimacy." I suspect we would be considered no better than the ungrateful cheese eating surrender monkeys.
Do you think America would have gone ahead anyway, despite the united opposition from Germany France Britain and Russia? (With China that's the other 4 permanent members of the security council). Or would Bush have put the whole thing on hold for a while?
Steve (as 41oo) wrote:
I'll have to go on a crash course in international finance. But I can't help thinking the normal rules don't apply to the US. America owes the rest of the world a fantastic amount of money, but somehow that debt doesnt matter. They just print more dollars and everyone's happy.
You sound like Charles De Gaulle!
Steve (as 41oo) wrote:
... Do you think America would have gone ahead anyway, despite the united opposition from Germany France Britain and Russia? (With China that's the other 4 permanent members of the security council). Or would Bush have put the whole thing on hold for a while?
Much would have depended on how British opposition was manifested. Would Britain merely have said no as did Germany, or would it have actively opposed our initiatives at every turn as did France?
In general I am convinced the Bush administration would have proceeded on much the same course with or without Britain. All the evidence to date certainly suggests this. Moreover, I believe the war would have ended on similar terms and in a similar time scale. I do not at all discount the British contribution to our collective success, both politically and militarily: however, the U.S. would have paid the extra price, and the Western World would have been much more seriously divided in the aftermath.
I believe British influence in the world, in Europe, and with the United States is much greater as a result of the decisions Tony Blair made in this area. It is interesting to speculate on the details had it been otherwise. Would the British people have liked the spectacle of their PM as Chirac's poodle?
Steve (as 41oo) wrote:
I was wondering the other day what American reaction would have been if Britain had sided with France Germany Russia over Iraq. How would W thought of us if Blair had said " look George we were with you in Afghanistan, standing shoulder to shoulder and all that, but Iraq has nothing to do with 911. We can't go along with an attack until the UN process is exhausted and gives it legitimacy." I suspect we would be considered no better than the ungrateful cheese eating surrender monkeys.
No I don't think because the USA and the UK speak the same language. I mean american people can read UK papers, watch your TV, etc to have a view of the english society. The more I read anti-french website, the more I think american's hate against France is based on misunderstandings. One of the funest and recurent think I read on these anti-french websites is that Chirac is socialist whereas he is exactly the ennemy of the socialists. Another funny thing is that socialist = communism. That's just a problem with translation ("socialiste" in french) because this is exactly the same thing as the UK's labour party (adn they don't criticize Blair). Sometimes when I'm reading US newspapers speaking about the french (I don't care when they speak about Chirac because a president is changed every 5 years) I wonder if they are not speaking about the french people living in another galaxy
georgeob1 wrote:I believe British influence in the world, in Europe, and with the United States is much greater as a result of the decisions Tony Blair made in this area. It is interesting to speculate on the details had it been otherwise. Would the British people have liked the spectacle of their PM as Chirac's poodle?
Interesting, George, how you formulate your response :wink:
I don't think, someone here in Germany or in Russia or in any other country not following the US led alliance sees their PM/chancellor/president as Chirac's poodle.
Why, do you think, would Tony Blair be weaker than his other European colleagues?
In response to Ning's comments, I don't believe there is any deep-seated hatred for France or the French people in the United States. There may well be some popular anti-French sentiment as a result of current events, but we are not haters and we are not fools.
We do recognize that, since 1941 France has only rarely chosen to align itself, agree with, or support key political and security positions taken by the United States. From the Armistice with Hitler, to the ill-advised post WWII attempt to retake her empire by force, to the expulsion of NATO forces from France during the darkest days of the Cold War, to Vietnam, Lybia, and now Iraq, France has consistently chosen to oppose the United States on fundamental issues of policy. Moreover France has generally done this in the most inimical manner possible, opposing our actions at every turn, rather than merely staking out an independent position. All this is certainly her right, bur Americans also have the right to draw the evident conclusions from it. What peculiar forces motivate this consistent attitude on the part of France is something on which we can only speculate. That it is present is beyond doubt.
Confusion about the meaning of words such as socialist and communist is certainly not a widespread factor in attitudes here, although the belief in that may well serve the complacent comfort of some in Europe.
Walter,
Those in Europe who called Blair Bush's poodle would likely have styled him as Chirac's had the policy been reversed. Chancellor Schroeder seems very comfortable in that role with respect to Chirac, and perhaps the German people no longer notice it.
georgeob1 wrote:Walter,
Those in Europe who called Blair Bush's poodle would likely have styled him as Chirac's had the policy been reversed. Chancellor Schroeder seems very comfortable in that role with respect to Chirac, and perhaps the German people no longer notice it.
The German people -at least those, read papers and notice the news in the media- know that there are regular meetings (at least once/month) between both governments/ministers etc.
Schröder doesn't play to Chirac nor the other way round.
(I truely believe, btw, that the French-German friendship would be much closer with a) a left French president/government or b) [which could happen, I fear
] a conservative German one like in France.)
Walter,
No doubt you are correct and the view from up close is different from that across the ocean. From here we see a remarkable consistency in the positions of France and Germany on issues ranging from trade, EU governance, and international policy.
Americans did, however, notice an important (though perhaps stylistic) difference in the manner of disagreement over Iraq between France and Germany. France opposed us at every turn, even after our decisions were made and the deeds were done. Germany made her position and oppodsition clear, but did not allow that to spill over to other matters.
Getting back to the issue of oil being traded in the Euro would have been very interesting, because of the increased valuation of the Euro in relation to the dollar. I wonder what impact that would have had to the world's energy consumption if most were forced to pay 30 percent more for fuel?
cicerone imposter wrote:Getting back to the issue of oil being traded in the Euro would have been very interesting, because of the increased valuation of the Euro in relation to the dollar. I wonder what impact that would have had to the world's energy consumption if most were forced to pay 30 percent more for fuel?
One might think, c.i., that the weak dollar is one of the reasons behind oil price surges :wink:
Walter, That's probably true, but we still pay one of the lowest prices for fuel. I recently paid $1.71 for premium the last time I filled up - still cheap compared to what most people in Europe or Asia (and most other countries) pays for gas.
Quote:US crude oil prices shot to a 10-month high last week, topping 35 US dollars a barrel for the first time since the Iraq war, on fears that freezing US weather will strain crude oil inventories already at their lowest level since 1975.
That's - the 35 $$, c.i., what all have to pay for it.
We don't pay more - we just pay more taxes. Lot more taxes.
George wrote
Quote:In general I am convinced the Bush administration would have proceeded on much the same course with or without Britain.
So am I. So Blair would not have stopped the war if he had sided with the French and the Germans. Moreover by going with US, Blair cemented the UK/USA alliance, and put Britain in a strategically strong position by being on the winning side in a conflict to control a vital strategic resourse. (no need to say what) And in my view relations with our European neighbours (we are Europeans) are repaired more easily than a rift between US and UK. So what Blair did might be immoral, illegal, unnecessary in fact totally disgraceful etc etc, but you can't deny the logic of it.
Ning wrote
Quote:The more I read anti-french website, the more I think american's hate against France is based on misunderstandings.
I'm sure this is correct. The Americans have enough trouble with the English language let alone French! :wink:
George wrote
Quote:Moreover France has generally done this in the most inimical manner possible, opposing our actions at every turn, rather than merely staking out an independent position.
and
France opposed us at every turn, even after our decisions were made and the deeds were done.
It does seem there is something about the Gallic style that really gets up the noses of the Anglo Saxons. Of course the Americans really do not like the French independent Force de Frappe, which might be at the root of it.
cicerone imposter wrote:Walter, That's probably true, but we still pay one of the lowest prices for fuel. I recently paid $1.71 for premium the last time I filled up - still cheap compared to what most people in Europe or Asia (and most other countries) pays for gas.
because oil are over(over)taxed in Europe. I think (no sure) it's because we have no oil resource in Europe (execpt Norway) whereas there is oil in the USA.
