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Old 05-28-2008, 05:40 PM   #13
CalX
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Join Date: Apr 2006
Posts: 966
Quote:
beejay, do you realize that it WAS OUR money? stolen from our economy, which is suffering quite a bit right now in case you havent noticed.
This is a pretty populist and superficial take.

Actually, it's the other way around. Saudi Arabia and the Gulf States are in many ways American colonies. Their subservant status has helped the US live above its means.

Example: The currencies of S.A. and the Gulf states are tied to the US$, which props up the currency and provides dividends to the US economy. When Japan or the UK buy Saudi oil, they have to pay that transaction in US$, effectively being forced to buy US debt. Without this, interest rates in the US would have to be a lot higher, and the US$ would be much more depressed than it is now.

S.A. and the Gulf States have taken a big economic hit because they can not diversify their reserves by selling $ and buying euros and float their currencies, their economy would do a lot better had their currency not been tied to the US$. They have pretty high inflation rates owing in good part to their US$ currency exposure.

As well, the current cultural climate in Saudi Arabia is excessively conservative and religious because its government (royal family) uses religion to establish their legitimacy as rulers, which is threatened by the fact that they are tightly propped by the US.
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