OH Oh...Arab states of the Gulf region launch a single currency:

[dixiegrrrrl]

breaking the formal and informal dollar pegs that have controlled the price of oil and kept the petro-dollar recycling mill operating, ( which was ) allowing The United States to force our inflationary policies down the Arabs' throats.

“The Gulf monetary union pact has come into effect,” said Kuwait’s finance minister, Mustafa al-Shamali, speaking at a Gulf Co-operation Council (GCC) summit in Kuwait.

The move will give the hyper-rich club of oil exporters a petro-currency of their own, greatly increasing their influence in the global exchange and capital markets and potentially displacing the US dollar as the pricing currency for oil contracts. Between them they amount to regional superpower with a GDP of $1.2 trillion (£739bn), some 40pc of the world’s proven oil reserves, and financial clout equal to that of China.

Worse:
The GCC also agreed to create a joint military strike force – akin to the EU’s rapid reaction force – to tackle threats such as the incursion of Yemeni Shiite rebels into Saudi territory earlier this year.
The Sunni Gulf states are deeply concerned about the great power ambitions of Shiite Iran and its quest for nuclear weapons, to the point where the theme of a possible war between Iran and a Saudi-led constellation of states has crept into the media debate.

They nevertheless repeated on Tuesday that “any military action against Iran” by Western powers would be unacceptable.

http://www.telegraph.co.uk/finance/economics/6819136/Gulf-petro-powers-to-launch-currency-in-latest-threat-to-dollar-hegemony.html

[AnOhioan]

1. According to the article...

the first phase towards a regional currency will begin in 2010. One minor glitch, the UAE is not participating yet.

[dixiegrrrrl]

2. The article does say:

"They are expected join later, along with Oman. "

the implications of this decoupling from the dollar as a world reserve currency will hit most people here
when imported oil and similar commodities prices hit the roof.

[Ken Burch]

3. Will they call it "The Arabo"?

n/t.

[dgibby]

4. Well, alrighty then,

when do we declare war on them?

[Mithreal]

5. Is this a reason we invaded Iraq? Or, are they just taking advantage of the situation?

Idk, just first thoughts.

[A HERETIC I AM]

6. This will be received by the international community with the same enthusiasm the Iranian oil bourse

was.

With a yawn.

[girl gone mad]

7. Not likely.

Short term there is enough pressure to keep the dollar will strong, but actions such as this move to the “Gulfo” further signal an impending crisis.

[A HERETIC I AM]

8. Says you.

There is a reason why no one runs to any of the gulf states looking for a safe place to park cash.

"Impending crisis" or not,if you think the secular oil traders of the world will take this seriously, you would be mistaken. Valid, easily traded currencies that are viewed with financial respect require stable, secular and open governments and economic systems.

An oil buyer in Singapore, Rotterdam, Tokyo, New York or Sydney KNOWS what he is getting if he is using the dollar or even the Euro or the Pound. He also knows the trade will settle with a currency everybody else will readily accept.

The nations of the "Arab States" have a LOOOONG way to go politically before they get to that point.

It's a yawn.

It's a mouse roaring.

[girl gone mad]

9. Says me.

People made many of the same arguments about the Euro.

Taken alone, perhaps it's a yawn. In the context of so many countries now losing confidence in the dollar, it's cause for concern.