Venezuela opts for oil contracts in euros: report

[dipsydoodle]

Source: UK Yahoo News

CARACAS (AFP) - Venezuelan state oil giant PDVSA has decided to sign some oil contracts in euros in the face of a plummeting dollar, local media reported, citing officials.


"There are some contracts in euros, contracts for crude, products and spot markets in euros. This is a subject which we are working on," said energy minister and Petroleos de Venezuela (PDVSA) chief, Rafael Ramirez, in an interview with the journal El Universal published Friday. It remained unclear which oil sales would require payment in euros.

Venezuela, Latin America's leading petroleum producer, has previously backed Iran's proposals for OPEC to abandon the dollar and use the euro for oil pricing. But the Organisation of Petroleum Exporting Countries has rejected the idea, at least in the short-term.

The head of the journal Petroleum World, Elio Ohep, said the shift to euros was "good business" for Venezuela.


Read more: http://uk.news.yahoo.com/afp/20080315/tbs-venezuela-commodities-oil-currency-e-5268574.html

[truthisfreedom]

1. Hmm. That's what Saddam did JUST before we invaded. That's what Iran did JUST before the cables

connecting them to the internet were sabotaged.

I say HMM.

[zonmoy]

2. no wonder the drumbeats for invading are sounding.

that is the one thing a country that produces a product the cabal wants to control dares not do unless they want a false flag attack or some other phony reason created to invade them.

[nikto]

3. It's weird to think this, but...

...Perhaps Venezuela is Attack Option#2, after Iran?

This country better wake up.

The guys on top want to invade somebody,
Bad.

And it just might end up
being a surprise
WHO the target country
turns out to be.

Bu$hCo is capable of anything, IMO.

[jwirr]

14. I don't think that is weird. A** hates Chavez and our oil companies

want "their" oil back. I think that is why much of South and Central America have been forming ties. Self-protection.

[Vidar]

53. A very real possibility, though it would have all the strategic brilliance of Hitler's invasion of

Russia, considering the two wars we're already waging unsuccessfully.

[magellan]

4. Venezuela, Iran, Venezuela, Iran...decisions, decisions....

I know, let's split the difference and invade the mid-Atlantic ridge!

[Pavulon]

5. to whom

no one else buys it, we dont pay in euros..

[dipsydoodle]

8. USA buys 50% of output

maybe China will buy what the USA don't want to pay for in Euros.

[Pavulon]

11. Maybe, but they need hundreds of mil

to build a system to refine and transport that tar. Why would they ship a commodity all the way across the ocean when demand is right here?

Never going to happen. Posturing by the man in red.

[northzax]

56. why would China want to pay in Euros?

most of their income is in dollars, why would they change it over?

this is smoke and fury, for small sales to places like Germany of things like refined crude. but, of course, PDVSA/Chavez has to make a huge announcement about it.

[razors edge]

20. Tell that to Israel.

They demanded Euros, they got em.

[The Doctor.]

31. It's a little more complicated than that.

Just converting to Euros will continue to sink the dollar on the energy market. We're in trouble.

[mbperrin]

54. Others do buy, And are set to buy more.

Quit misrepresenting facts. Or if you have none, get some.

http://209.85.165.104/search?q=cache:bhqk2aRyWeQJ:www.cfr.org/publication/12089/venezuelas_oilbased_economy.html+venezuelan+oil+exports&hl=en&ct=clnk&cd=1&gl=us


How much Venezuelan oil goes to the United States?

Venezuela supplies about 1.5 million barrels per day of crude oil and refined petroleum products to the U.S. market, according to the EIA. Venezuelan oil comprises about 11 percent of U.S. crude oil imports, which amounts to 60 percent of Venezuela’s total exports. PDVSA also wholly owns five refineries in the United States and partly owns four refineries, either through partnerships with U.S. companies or through PDVSA’s U.S. subsidiary, CITGO, Inc. A U.S. Government Accountability Office (GAO) report (PDF) says Venezuela’s oil exports of crude oil and refined petroleum products to the United States have been relatively stable with the exception of the strike period. Vicente Frepes-Cibils, lead economist for Venezuela at the World Bank, says “Venezuela will continue to be a key player in the US market.” He argues that in the short term it will be very difficult for Venezuela to make a significant shift in supply from the United States. Nevertheless, Chavez has been increasingly making efforts to diversify his oil clients in order to lessen the country’s dependence on the United States. The GAO report says the sudden loss of Venezuelan oil in the world market would raise world oil prices and slow the economic growth of the United States.
How is Chavez expanding Venezuela’s commercial ties with other countries?

* China. Venezuelan oil exports to China have gone up to 150,000 barrels per day in 2006 from the 12,300 barrels per day being delivered in 2004 and are expected to increase to 500,000 barrels per day within five years. As part of agreements signed in 2005, China is investing $2 billion in oil-related exploration and development projects in Venezuela’s Zumano region and Orinoco oil belt. China is also investing $9 billion in transportation infrastructure as well as telecom, mining, and the agricultural industry.
* Iran. Venezuela and Iran made agreements in August 2006 to build joint oil refineries in Indonesia, Syria, and Venezuela. In addition, Iran’s state-owned oil company Petropars has begun to invest in oil exploration and development in the Orinoco belt.
* India. Venezuela agreed in April 2006 to begin sending two million barrels per month to India, according to India Daily. Both countries are jointly exploring for heavy crude oil in India.

[liberal N proud]

6. So are we going to invade Venezuela now

Since that was the true untold reason we attacked Iraq.

[Pavulon]

7. The global market is in dollars

what they are doing is totally pointless. They only sell to us and we will not pay them in Euro.

[dipsydoodle]

9. The global market

is in petrodollars , fiat money, which can only be re-invested in the USA. Cute little system that which may be nearing its end.

[Pavulon]

10. May , may not, but until it does.The fat guy in the red

shirt is putting on a nice show. Maybe to bump the price of the only thing of any value that is experted from the country he runs?

[Caretha]

17. You got it edwardlindy

The reality of the situation for the past few years is really about pricing oil in US dollars. The world has been supporting the phony US economy (deficits, negative GDP, wars, and all the other multiple monetary ponzi schemes) by trading oil in dollars. We went to war in Iraq because of it, we're rattling our saber at Iran because of it, we overlooked Saudi Arabia's complicity in 911 because of it, we've had underground illegal operations in SA because of it, and we amped the anti-socialist rhetoric against Venezuela because of it. The truth be, once the rest of the world decides not to support the US's out of control consumption and waste, imperial wars, and exploitation of other countries for their resources, the gig is up.

And guess what, the gig is up. That's why we're seeing the first throes of the collapse of the US economy. No matter what the economists say, the elected or unelected officials of the WH/government say, the US is seeing the first stages of decoupling the US dollar from the price of oil. This has been the only thing actually supporting our insane economy for the last few decades and what has driven the "Cheney & PNAC's secret oil/US dollar agenda.

What the hell else are they going to say, besides "All will be well". We've lost or are in the process of losing all global economic control that the US has enjoyed for the past couple of centuries.

"May you live in interesting times" could not be a truer statement for today's era concerning the US's demise in the world's continuing saga of the big game ..who will be "King of the Hill".

Ain't we lucky :)

[superkia]

36. The elite have the European union behind them and now they...

have formed a Mediterranean union. All they need to do now is finish up with their plans for the north american union and they will have a nice little team spread around the world. Why do you think they want that missile defense system built over in Europe so bad, they want to be able to attack without any repercussions. Luckily, Russia is standing firm against it and realize what is taking place. I think Iran, Venezuela and China also know exactly what the elite are trying to do. Thats why everyone is in such a hurry to build weapons for space, thats the next way of attack.


Its amazing that a few elite bankers could come with an idea back in the early 1900's to take over the world and enslave its people to run it for them...and its been working.

[OneAngryDemocrat]

15. Um...

"We" don't buy oil - America's private oil companies do - and they have access to Euros, and they WILL pay ion Euros.

[Pavulon]

16. The market does not run in Euros

why should they pay in euros because of the demands of a guy who runs a country whose gdp is lower than revenues they post.

[leftrightwingnut]

18. What do you mean, "the market does not run in Euros"?

If the man in the red shirt wants clay pigeons for his oil, the oil companies can use dollars to buy clay pigeons and exchange it for the oil.

Euros, clay pigeons, dollars. What's the difference?

[Pavulon]

19. The transactions happen in dollars

pretty simple. He has the burden of conversion. Guess that comes with being the customer..

[leftrightwingnut]

21. I'm sorry. I'm really confused and dense, I guess.

The man in the red shirt is... the customer? The customer is selling the petroleum?

What prevents him from offering his product priced in Euros on the Iranian Bourse, for example? Or his own "market"? At a discount in euros converted from the spot price in dollars? (Other than the fact that the U.S. will shred his little country.)

[Pavulon]

24. The oil market is transacted

in US dollars. On occasion the sellers, petro states, complain about this but generally do jack shit.

So hugo, a seller of tar refined only in the us, takes his bounty in dollars. He slings a little product around to make people think he gives a fuck. But he wants, and says, oil belongs above $100.

He sells a commodity, nothing that requires any real effort or diversity. Good luck with that.

[brentspeak]

71. Well, apparently, if buyers want to buy Venezuela's crude, they'll have to pay in Euros

I'm not saying that's right, but if that's what he demands, I don't see how buyers can circumvent that.

[Pavulon]

72. The burden is on him.

the market trades world wide in dollars. He is like a guy in the middle of the sidewalk midtown selling hotdogs in euros.

[superkia]

34. Thats why I feel they want to add them to the so called terrorist...

list. I think we will hit Venezuela before Iran. Its sad that any oil rich country that doesn't want to go along with th elites agenda has to die or be replaced by a puppet that we can control. It sounds crazy to say it but China, Iran, Russia and Venezuela could actually be who stops the elites agenda and ends up saving our asses.

[SpiralHawk]

12. "Take that, Senor El Diablo, you Imperial AWOL Republicon Evil-Doer, you." - Hugo

[Pavulon]

13. Here is the real reason for all this drama.

no more, no less.

[ozone_man]

22. Or is it this chart?

The dollar just isn't worth much anymore, so it makes sense to get paid in a currency that doesn't lose value every day.

[leftrightwingnut]

26. Ouch! And all of my retirement investments are tied up in dollars...

I recommend that we nuke Iran and Venezuela immediately. Gotta stop that slide...

[Pavulon]

27. PPP and tides

the selling price of the dollar is important, it depends how cash flows. remember when people were smashing products from Japan..

[ozone_man]

44. Increasing demand doesn't explain the shift to euros.

The weakening dollar does. Every day that dollars are held there are more losses. It makes no sense for them to trade in dollars anymore.

Also, there is the anti-imperialist motivation, to resist dollar hegemony. This is probably an equally important reason.

Aside from oil though, many countries are moving away from the dollar to a stable "basket" of currencies including gold.

[Pavulon]

45. Euros, YEN

it is all cyclical. I remember the drama of the strong yen. People all pissed because Japanese were buying up the us..The horror.

A quick google of world wide gdp or a look at global ppp speaks clearly.

For anyone who is older than 40 or reads economic journals this should look like past periods.

Structure your investments accordingly.

[ozone_man]

49. This may be a permanent trend down (not cyclical) for U.S.

I think we're seeing the end of the American empire unfolding. The loss of dollar as the world's currency is one sign.

But your original post seems not relevant. The oil demand is not the reason that Venezuela is switching to euros.

CARACAS (AFP) - Venezuelan state oil giant PDVSA has decided to sign some oil contracts in euros in the face of a plummeting dollar, local media reported, citing officials.

It's the falling dollar. Also, I think they have other problems with U.S. intervention and imperialism that is part of the decision.

Oil demand will raise the price of oil, but not cause producers to switch currencies. They are switching because they want to be paid in a strong, reliable currency, something that the dollar is no longer. Our banks are failing and being bailed out by the FED. Not a good sign.

[Pavulon]

50. Again the market works in dollars

example. I want to buy your car. you decide that we dont do dollars. So I go and get euros. It costs more. However I really want your car.

You take my euros and realize that you live in the US. You rent, mortgage, and income tax is collected in...dollars.

so you convert my euros back. for a fee.

what you engineered was basically a higher price for your car.

This is a very simple analogy of a complicated thing. However the ENTIRE world market for petroleum runs on dollars.

The only bank to be bailed out was an investment bank, it made bad ..INVESTMENTS. Wake me up when wachovia has problems.

There are plenty of non consumer banks.

CYCLICAL.

[ozone_man]

52. The reason they are switching to euros is the weak dollar.

I know you want to change the subject, but I'm not letting you. Oil demand was not their reason. :)

As to whether switching to euros is a good idea or not, That's a different question.

However the ENTIRE world market for petroleum runs on dollars.

For now, but it appears that could be changing if the dollar collapses. The example you gave regarding euros seems applicable to a U.S. consumer, but not a Venezuelan or Iranian consumer. The cars they buy probably aren't valued in dollars.

Face it, the American empire is in decay, a fate all empires eventually face.

[Pavulon]

65. I like now. Now is reality

the fate of America and its failure is you opinion. Which is entertaining but not terribly relevant to the global petroleum market.

The Venezuelan consumer and Iranian consumer consume less than a large state economy.

The US economy out paces the nearest nation GDP by 4 times. PPP is also an indicator.

My company sales have over doubled to the European and Asian market. Because our expensive specialized equipment is now MUCH cheaper in europe, even after a modest price increase.

[fascisthunter]

29. I'll Take Your Graph over the Other's Any day

he/she seems to have a right leaning persuasion that is consistently misleading.

[Pavulon]

47. PPP says it all(nt)

[hunter]

23. You show $68 in 2006.

It won't ever be there again.



From loindelrio in E/E.

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=115&topic_id=138824&mesg_id=138830

Nobody is going to force these prices down by increasing supply -- because they can't.

[Pavulon]

25. Crazy, $20 in 99

big money in the futures market back then.

You think supply has changed much in that time?

Fucking shell game.

[hunter]

41. The rules of the game change rapidly after peak.

Clack, clack, clack, up to the top on the roller coaster you go at a fairly constant rate. And then on the way down it's zoom, zoom, zoom, prices accelerate.

On the upslope you can maximize your profits and/or market share by undercutting your competitors. On the downslope you maximize your profits by raising the price to a level that reduces demand to match the production you are capable of. Put your price too high and your market dies. Put your price too low and your competitors will eventually make more money than you simply by leaving their oil in the ground until you are tapped out.

Past peak there's no profit in shell games and cross street price wars. The only game left now is to keep people in the market just so long as you can, maybe by convincing them that the market is a shell game... or that refining capacity is short... or that it's all speculators... or any of the other excuses we've heard.

If anyone had excess production capacity now they could make a lot of short term profit and preserve their markets by turning up the taps. Is Saudi Arabia doing that? How is further deterioration of the dollar and U.S. assets a good thing for Saudi Arabia? It's not. They are not increasing their production because they can't.

It would be very nice if I was wrong, if this turned out to be an Enron in California electric market sort of rip off. But I think that's simply wishful thinking.

Oil production has to peak sometime, and it seems silly to believe there is more easy oil lurking about somewhere -- if there was we wouldn't have gone to such extremes as very deep sea oil platforms, tar sand extraction, and military occupations of Iraq.

It seems reasonable to me, and it is consistent with the behavior of the big oil producers, to say it is peak oil now.

Time will tell.

It's sort of like the situation with climate change. When our coastal cities are being chewed away by rising sea levels, and former beach resorts are surrounded by seawalls not beaches, then it will be undeniable. When our economy is being chewed away by rising oil prices, it will be undeniable.

But maybe today there is enough doubt to claim speculation.

[fascisthunter]

30. Gee... I Wonder Why?

[SpiralHawk]

43. "Nobody seems to be factoring THIS graph into the equation." - Commander AWOL

."

[GainesT1958]

28. And why would Europe want it?

It's "heavy", thick oil compared to any from the Gulf region, and much pricier to bring across the Atlantic. Chavez' only real sales appeal is to countries in his own hemisphere, and his sabre-rattling dampens that considerably. And yet, he claims he's leading his nation out of poverty.

I fail to see how he accomplishes that when he's single-handedly destroying the largest market for his most valuble commodity. Count me among the DUers who is definitely NOT a Chavez fan.:eyes:

B-)

[bhikkhu]

32. Money trumps politics, most of the time.

If it weren't Chavez it would be someone else. The weak dollar is dragging down all oil-producing states.

[plasticsundance]

63. Like most at DU that hate Chavez, you're ill-informed

Venezuela is the third largest importer of oil to the United States.

Crude Oil and Total Petroleum Imports Top 15 Countries

[Judi Lynn]

33. Hmmmmm. What a dilemma. Whose opinion to consider more informed: Nobel Prize winner Joseph Stiglitz,

or a PNACker infesting a progressive message board. Tough predicament.

Joseph Stiglitz, in Caracas, Praises Venezuela’s Economic Policies
October 11th 2007, by Kiraz Janicke – Venezuelanalysis.com
Economics Nobel laureate Joseph Stiglitz Caracas, October 11, 2007 (venezuelanalysis.com) - Nobel Prize winning economist and former vice-president of the World Bank, Joseph Stiglitz, praised Venezuela's economic growth and "positive policies in health and education" during a visit to Caracas on Wednesday.

"Venezuela's economic growth has been very impressive in the last few years," Stiglitz said during his speech at a forum on Strategies for Emerging Markets sponsored by the Bank of Venezuela.

Venezuela, the fourth largest exporter of crude oil to the United States, has experienced the highest economic growth rate in Latin America in recent years, with fifteen successive quarters of expansion and looks set to close the year with 8-9% growth. Despite the high rate of growth, high public spending and increased consumer demand have contributed to inflationary pressures, pushing inflation up to 15.3%, also the highest in Latin America. However, Stiglitz, who won the Nobel Prize for economics in 2001, argued that relatively high inflation isn't necessarily harmful to the economy.

He added that while Venezuela's economic growth has largely been driven by high oil prices, unlike other oil producing countries, Venezuela has taken advantage of the boom in world oil prices to implement policies that benefit its citizens and promote economic development.
(snip)

Stiglitz also criticized the "Washington Consensus" of implementing neo-liberal policies in Latin America, in particular the US free trade agreements with Colombia and other countries, saying they failed to bring benefits to the peoples of those countries.

The Washington Consensus "is undermining the Andean cooperation, and it is part of the American strategy of divide and conquer, a strategy trying to get as much of the benefits for American companies," and little for developing countries, he said.

More:
http://www.venezuelanalysis.com/news/2719

[freefall]

35. Thanks for posting this. I have great admiration for Stiglitz and

was unaware of this speech.

Peace,

freefall

[Judi Lynn]

37. He'll be on C-Span 2 tomorrow evening, at 7:00 E.S.T., with co-author,

Linda Bilmes, to discuss their book.

7:00 PM 1 hr, 12 min The Three Trillion Dollar War: The True Cost of the Iraq Conflict
Authors: Linda Bilmes; Joseph Stiglitz

http://www.booktv.org/schedule.aspx

On edit:

I saw part of the program Saturday evening. It was VERY interesting.

[JohnnyCougar]

38. Wow, thanks for that article!

I feel like South America is the new Middle East right now. We are trying to turn Venezuela into the next Iraq, except Hugo Chavez is pretty much the total opposite of Hussein. We're trying to pump weapons into Hugo's neighbor in order to militarily dominate him, spread lies and falsehoods about him, and our press is totally complicit. I've even heard reports on NPR that were fairly slanted.

[Judi Lynn]

39. I'm glad you reserve your temptation to buy what NPR is selling. They've been transformed by the

Republican take-over of Congress years ago, when the right-wing started slashing and hacking away at their budget, and PBS's, as well, just shredding them both, then forcing them to drop any progressiveness, and jump through hoops to get their future funding. You might be able to recall how much noise they started making about every aspect of arts funding, and breathing down the necks of NPR, and PBS, and the hate spew that started coming out of the radio show hosts as they raved on about how "liberal" the public radio and tv networks were, how "leftist." Yeah, right!

They waged war against them, and they broke down under the strain, and became only a shadow of their former selves. It's truly ugly to see what they've become.

I was horrified and shocked. A lot of DU'ers have discussed it here, from time to time, over the years. Republican Presidents started filling the management of these places with right-wing ideologues, just like the FCC. Stick a fork in them, they're done. What a loss!

The Republican Congress raised holy hell about the fact the public radio and tv networks were given their salaries by the U.S. public and must be accountable to the American public, then made the decision for us that ALL we want to hear for our taxpayer dollars is right-wing programming, and right-wing news. You've also noticed a substantial movement AWAY from socially serious programs, and a lot of empty, pointless stuff put back in. Hey, thanks, Republicans.

[Judi Lynn]

40. JohnnyCougar, I just noticed your quote! Wow. I've never seen that before. Thanks. n/t

[JohnnyCougar]

46. It was from an interview with Ted Koppel.

[hunter]

42. NPR is Fox News for people who think they are too smart for Fox News.

The U.S. media is rotten. The right wing bought it, almost all of it, including NPR.

There are only bits and pieces of it where the light still shines.

[plasticsundance]

64. Spot on, Judi Lynn

From Judi Lynn's article:

Despite the high rate of growth, high public spending and increased consumer demand have contributed to inflationary pressures, pushing inflation up to 15.3%, also the highest in Latin America. However, Stiglitz, who won the Nobel Prize for economics in 2001, argued that relatively high inflation isn't necessarily harmful to the economy.

Cristina Fernández de Kirchner is doing the same in Argentina. Instead of bending to the will of the IMF, Argentina has decided to let inflation rise. It has proved more beneficial for Argentina to getting back on its feet economically.

Type in Kirchner, IMF, Democracynow into Google and you'll find a wonderful segment that explains it.

[roamer65]

48. Just wait until the American oil companies hafta pony up in Euro.

:evilgrin:

[Pavulon]

51. PS they will just pass the shit end on to...

you and me. They do not care about anything except profit. In whatever currency.

[northzax]

57. and everyone will celebrate

not realizing they are paying to exchange currencies.

sound and fury, signifying nothing. but let's all enjoy the doom and gloom.

[Supersedeas]

55. is OPEC next?

[DiverDave]

58. If OPEC switches, we are truly fucked...

eom

[Doctor Cynic]

59. Don't worry about that

OPEC has basically turned irrelevant anyways, but the bigger concern is if the Gulf Arab States take note of rising inflation at home and stop pegging their money to the USD. THEN, the USD is f-u-c-k-e-d.

[high density]

60. He'll come back when the dollar rebounds

And yes, the dollar will rebound despite the chicken littles here on DU.

[hunter]

61. Why do you think the dollar will "rebound?"

It certainly looks like our fearless financial leaders fully intend to blow all that bad debt out of the pipes by inflation.

Whatever floor they set, I expect the dollar is going to hit it like a rotten tomato.

SPLAT.

It used to be when the U.S. economy sneezed, the world caught our cold. Nowadays the rest of the world circles around like vultures, waiting to pick out choice pieces of flesh at fire sale prices.

[Pavulon]

66. Cyclical

market cycles are normal. Shit goes up, then goes down. Japan has had strong and weak yen. Remember when everyone was smashing japanese products?

Yep. Cyclical.

If there were a true market collapse fucked does not even begin to describe the world economic state.

BTW if you happen to sell very high end cnc machine tools that are made in the US. You would be doing pretty well now.

[hunter]

69. Fast Fourier Transforms work on finite fields.

Any finite field can be described in terms of cycles.

Unless you know what causes the cycles -- for example earth's seasons -- there's no meaning in calling something "cyclic."

If an old man is walking across the room his head will bob up and down in a cyclic manner, but this cycle stops if he lies down on the sofa and takes a nap. If he doesn't ever wake up again, well then, his head won't be doing much bobbing up and down when he walks, will it?

Empires don't last forever, and I figure the post World War II U.S. empire is closing up shop. We will continue on as another sort of nation, but only after some extensive and sometimes painful remodeling. In the short term a lot of workers will be displaced, and a lot of financial structures will have to be abandoned.

Throw some climate change and peak oil into this unstable mess, and I think it's an absurd stretch to call anything but the most basic seasonal aspects of this market "cyclical."

[Judi Lynn]

62. Argentina, Brazil to drop U.S. dollar in bilateral commercial transactions

Argentina, Brazil to drop U.S. dollar in bilateral commercial transactions


www.chinaview.cn 2008-03-16 14:03:09

BUENOS AIRES, March 15 (Xinhua) -- Argentina and Brazil are to scrap bilateral commercial transactions in U.S. dollars and start using their own currencies from August, an official in charge of currency settlement at the Argentine Central Bank said here Saturday.

The new payment system is aimed at reducing costs in commercial transactions and would benefit small and medium-sized enterprises, the official said.

Under the new system, there will be a unified exchange rate between the real and peso, the so-called reference rate, which will be applied by Brazilian and Argentine central banks at the end of each day.

Brazilian President Luiz Inacio Lula da Silva reached an agreement to establish a new payment system with his Argentine counterpart Cristina Fernandez de Kirchner during his visit to Argentina in February.

Technical preparations are underway for the new system, which the two countries will adopt in several steps due to the large amount of bilateral trade.

More:
http://news.xinhuanet.com/english/2008-03/16/content_7800121.htm

[Pavulon]

67. No impact.

the us economy even in full recession generates more wealth then all nations you listed COMBINED.

And if their system blows up, we will bail it out. Like we did in Asia, after a certain hedge fund manager helped wreck their systems.

[Judi Lynn]

68. Here's proof you can afford to relax while still being a major blowhard.

[Pavulon]

73. PPP. Reality and entertainment..

if all the dope dealers in orange county switched to euros it would have a much bigger impact. Again the scale of our economy is truly massive.

[Doctor Cynic]

70. Nah. The long-term trends are changing.

Late last year when Wall Street got hit with billion dollar writedowns, who bailed them out? China, Singapore, Dubai. 2007 was also important because it's the first year where the US saw a net *inflow* of investment.

Remember when China tried to buy Unocal, and when Dubai tried to buy a dozen US port operations? Or how about when a Spanish company wants to build some highways in Texas?

When more Wall Street banks go under, it will be those countries that will buy them at firesale prices prevent the entire banking system from collapsing.

The US Dollar will only recover when the government and economy stop writing IOUs to the Chinese/Japanese/Germans/Russians/etc.