[lutherquick]

We hear stories like Russia is uncomfortable with the dollar.
The reason is that the dollar dropped 40% that last few years, and it's headed for more of a drop.

But in truth, if the dollar drops another 50%, then oil would double just to stay even. In other words, if oil prices didn't change much, a falling dollar would make energy cheaper for the US. Or we Americans simply print more and get same amount of energy with a falling dollar without working any harder... maybe a little more paper work... but that's it...

Therefore, there are many factors here. There are two heads on this snake. First is peak oil, which should raise prices, second is a falling dollar because of US debt, lost manufacturing, over printing of it's currency and delusions of Iraqi peace. All together, oil really hasn't changed that much in price to slow demand, because the dollar is tanking... the only thing that makes this work is demand for the dollar, even as the FED over supplies it...

Next, it seams to me that US monetary power is essentially being transferred out of the country to nations with oil reserves. What's happening is that when a country like Russia eludes that they will drop the dollar, this actually dumps more dollars on the market, just like the FED lowering interest rates... Ultimately, the FED will have to double it's moves (really raise interest) to compensate... Or, maybe the FED wants to inject more liquidity (this I think is it) thus debasing the dollar and taking away that power from nations like Russia, China, Iran, Venezuela, Saudi Arabia and China. When a country like China or Russia start to shy away from the US dollar, this has the same effect of the FED lowering interest rates...

It's like we now have TWO FED departments, one inside the US, and one as an agregate of all the nations holding said worthless dollars...

My point is that we are losing power, but it's like we are on our death bed and the morphine trip makes it all enjoyable. Our beloved America is losing it, and few want to reverse this. Power will always be with those that have the energy reserves and those that manufacture something. America can't expect to be the world's delegate, the management of Earth, it sounds good but it won't happen.

The dollar has had a great run for along time. But we have abused it's strength the last decades. Today we are using it to buy time as peak oil bites. We Americans expect the dollar to insolate us from peak oil. In fact, it's just another morphine shot...

We need to debase the dollar hard and fast, this will bring back jobs and force us to deal with peak oil. If we don't, then the rest of the world will debase the dollar on their terms, and this is not far away.

[ForeignObserver]

We hear stories like Russia is uncomfortable with the dollar.
The reason is that the dollar dropped 40% that last few years, and it's headed for more of a drop.

But in truth, if the dollar drops another 50%, then oil would double just to stay even. In other words, if oil prices didn't change much, a falling dollar would make energy cheaper for the US. Or we Americans simply print more and get same amount of energy with a falling dollar without working any harder... maybe a little more paper work... but that's it...

I don't see how energy will be cheaper in the US with a falling dollar if it is priced in dollars. It will be cheaper for everyone else as their currencies will buy more dollars.