Description
This ppt will give you detail information regarding what is petro dollor system.
PETRODOLLAR
NAME KRISHNA PRASAD GANESH SAWANT SUMEDH GAIKWAD SONALI GOTHANKAR TEJAS MAHOREY SANTOSH VEER ROLL NO 30 19 63 62 65 54
GAGAN LAMBA
17
How did USD established as A global currency ???
What is OPEC Countries ???
What exactly is the petrodollar system???
Is petro Dollar disadvantage to other countries ??? why did they Oppose ???
Are there any hidden benefits to USA ???
What if Petro $ dies ???
What’s happening now ???
ESTABLISHMENT OF DOLLAR AS A GLOBAL CURRENCY
Impact of event : Bretton Woods Conference, 1944
? The U.S. Dollar pegged at a fixed rate to gold. ? Financial security and stability. ? Strong global demand for USD ? Gave Federal Reserve a “Permission slip” to print more dollar. ? After world war II, 80% world’s gold in U.S. vaults &USD became a officially world’s undisputed reserve currency.
? Dramatic Growth and expansion of US economy
ESTABLISHMENT OF DOLLAR AS A GLOBAL CURRENCY
THE DOWNFALL ? By 1971, America's trade deficits and domestic spending increased. ? Vietnam War. ? Debt mounting on America. ? Foreign banks exchanged dollar for gold.
Nixon Shock 1971 US President Richard M. Nixon, detached the U.S. Dollar from its convertibility into gold. This led to the potential shift in global demand for the U.S. dollar. With the dollar no longer convertible into gold, would demand for the dollar by foreign nations remain the same, or would it fall? What was the USA’s next strategy
OPEC COUNTRIES
Formation : Baghdad Conference on September,1960 Former Members : Iran, Iraq, Kuwait, Saudi Arabia and Venezuela Later on Additional 9 Countries joined: Qatar ; Indonesia; Libya ; United Arab Emirates; Algeria; Nigeria; Ecuador; Angola ;Gabon. Objective : OPEC's objective is to coordinate and unify petroleum policies among Member Countries, in order to secure fair and stable prices for petroleum producers
WHAT EXACTLY IS THE PETRODOLLAR SYSTEM ?
A petrodollar is a U.S. dollar that is received by an oil producer in exchange for selling oil
Petro-Dollar Deal in 1970
Oil Producing nations get: ?Weapons ?Military protection ( often from Israel ) The United States gets : ?Oil priced in dollars( create artificial dollar demand ) ?Artificial demand for U.S. Treasuries
USA BENEFITS OF THE PETRODOLLAR SYSTEM TO USA
BY THIS SYSTEM ? Oil consumers are required to purchase oil in
? U.S. dollars. The excess profits of the oil-producing nations are then placed into U.S. government debt securities held in Western banks.
At least three immediate benefits to the United States.
? ? ? It increases global demand for U.S. dollars. It increases global demand for U.S. debt securities. It gives the United States the ability to buy oil with a currency it can print at will.
In Essence, The Americans brought their oil literally for free by printing those dollars. The ultimate free lunch for the Americans at the expense of the rest of the world.
OPPOSE TO PETRO-DOLLAR SYSTEM
• Oppose starts when Saddam Hussein started selling Iraq's oil directly for Euro, abrogating the cozy arrangement the Americans had with OPEC.
Thus Saddam had to be stopped. How?
• USA concocted up a pretext to wage war (drama of twin tower blast) and invade Iraq and the first thing the Americans did was to revert sales of oil back to dollars. The currency crisis was averted for the moment.
OPPOSE TO PETRO-DOLLAR SYSTEM
• Venezuela President(Hugo Chavez) also started selling Venezuelan oil for currencies other than dollars, so there were a number of attempts on his life and “Government change“.
• Iran President(Ahmedinejad), watching all of this, decided to kick The Great Satan in the goolies and do the same thing-sell oil for every currency EXCEPT US dollars.
CURRENT SCENARIO
Is the petrodollar dead ???
CURRENT SCENARIO
Iran Japan
Australia
INDIA
Russia Brazil Japan
UAE
CHINA
Africa Chile
Till today 11 international agreements happens that are nails in the coffin of the petrodollar.... ( July,12 )
IMPACT ‘S IF THE PETRODOLLAR SYSTEM DIES !!!
? A flood of U.S. dollars back to the United States. ? Lose their ability to print more dollars. ? Increase in interest rates to reduce America's money supply. ? Hyperinflation ? Asset prices across the board would plummet in value. ? Could lead to Another Sub Prime Crisis. ? Could lead to World War 3
Thank You
doc_176935094.pptx
This ppt will give you detail information regarding what is petro dollor system.
PETRODOLLAR
NAME KRISHNA PRASAD GANESH SAWANT SUMEDH GAIKWAD SONALI GOTHANKAR TEJAS MAHOREY SANTOSH VEER ROLL NO 30 19 63 62 65 54
GAGAN LAMBA
17
How did USD established as A global currency ???
What is OPEC Countries ???
What exactly is the petrodollar system???
Is petro Dollar disadvantage to other countries ??? why did they Oppose ???
Are there any hidden benefits to USA ???
What if Petro $ dies ???
What’s happening now ???
ESTABLISHMENT OF DOLLAR AS A GLOBAL CURRENCY
Impact of event : Bretton Woods Conference, 1944
? The U.S. Dollar pegged at a fixed rate to gold. ? Financial security and stability. ? Strong global demand for USD ? Gave Federal Reserve a “Permission slip” to print more dollar. ? After world war II, 80% world’s gold in U.S. vaults &USD became a officially world’s undisputed reserve currency.
? Dramatic Growth and expansion of US economy
ESTABLISHMENT OF DOLLAR AS A GLOBAL CURRENCY
THE DOWNFALL ? By 1971, America's trade deficits and domestic spending increased. ? Vietnam War. ? Debt mounting on America. ? Foreign banks exchanged dollar for gold.
Nixon Shock 1971 US President Richard M. Nixon, detached the U.S. Dollar from its convertibility into gold. This led to the potential shift in global demand for the U.S. dollar. With the dollar no longer convertible into gold, would demand for the dollar by foreign nations remain the same, or would it fall? What was the USA’s next strategy
OPEC COUNTRIES
Formation : Baghdad Conference on September,1960 Former Members : Iran, Iraq, Kuwait, Saudi Arabia and Venezuela Later on Additional 9 Countries joined: Qatar ; Indonesia; Libya ; United Arab Emirates; Algeria; Nigeria; Ecuador; Angola ;Gabon. Objective : OPEC's objective is to coordinate and unify petroleum policies among Member Countries, in order to secure fair and stable prices for petroleum producers
WHAT EXACTLY IS THE PETRODOLLAR SYSTEM ?
A petrodollar is a U.S. dollar that is received by an oil producer in exchange for selling oil
Petro-Dollar Deal in 1970
Oil Producing nations get: ?Weapons ?Military protection ( often from Israel ) The United States gets : ?Oil priced in dollars( create artificial dollar demand ) ?Artificial demand for U.S. Treasuries
USA BENEFITS OF THE PETRODOLLAR SYSTEM TO USA
BY THIS SYSTEM ? Oil consumers are required to purchase oil in
? U.S. dollars. The excess profits of the oil-producing nations are then placed into U.S. government debt securities held in Western banks.
At least three immediate benefits to the United States.
? ? ? It increases global demand for U.S. dollars. It increases global demand for U.S. debt securities. It gives the United States the ability to buy oil with a currency it can print at will.
In Essence, The Americans brought their oil literally for free by printing those dollars. The ultimate free lunch for the Americans at the expense of the rest of the world.
OPPOSE TO PETRO-DOLLAR SYSTEM
• Oppose starts when Saddam Hussein started selling Iraq's oil directly for Euro, abrogating the cozy arrangement the Americans had with OPEC.
Thus Saddam had to be stopped. How?
• USA concocted up a pretext to wage war (drama of twin tower blast) and invade Iraq and the first thing the Americans did was to revert sales of oil back to dollars. The currency crisis was averted for the moment.
OPPOSE TO PETRO-DOLLAR SYSTEM
• Venezuela President(Hugo Chavez) also started selling Venezuelan oil for currencies other than dollars, so there were a number of attempts on his life and “Government change“.
• Iran President(Ahmedinejad), watching all of this, decided to kick The Great Satan in the goolies and do the same thing-sell oil for every currency EXCEPT US dollars.
CURRENT SCENARIO
Is the petrodollar dead ???
CURRENT SCENARIO
Iran Japan
Australia
INDIA
Russia Brazil Japan
UAE
CHINA
Africa Chile
Till today 11 international agreements happens that are nails in the coffin of the petrodollar.... ( July,12 )
IMPACT ‘S IF THE PETRODOLLAR SYSTEM DIES !!!
? A flood of U.S. dollars back to the United States. ? Lose their ability to print more dollars. ? Increase in interest rates to reduce America's money supply. ? Hyperinflation ? Asset prices across the board would plummet in value. ? Could lead to Another Sub Prime Crisis. ? Could lead to World War 3
Thank You
doc_176935094.pptx