It's interesting how for decades, the story of Saudi Arabia recycling US petrodollars, i.e., funding the US deficit by buying US Treasuries with proceeds of its crude oil sales (mostly to the US), while the US sweetened the deal by providing the Saudis with military equipment and supplies, remained entirely in the conspiracy realm, and how with this fascinating Bloomberg story this "theory" now becomes fact.
The Untold Story Behind Saudi Arabia’s U.S. Treasury Holdings
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Re: The Untold Story Behind Saudi Arabia’s U.S. Treasury Holdings
#62There's a book called confessions of an economic hit man - https://en.wikipedia.org/wiki/Confessions_of_an_Economic_Hit... Essentially U.S. helps impoverished nations with infrastructure and other aid, but saddles them with debt in order to control them politically or otherwise. The interesting part was when it came to Saudi Arabia, which had so much money it didn't need to take on debt to develop their infrastructur…
I'd love to hear more. Where you married? What was it like for you spouse? If not, what was the dating scene like in 82?
Did you travel around any? What are the most interesting parts of the country? Did you ever make it to Mecca?
How good are you at recognizing family names and power connections? Did that come with time?
How did people in different parts of the country view each other?
I just returned from a week in Jeddah and Riyadh. Here are some photos from a fancy jail. Housing some of the 5000 terrorist/jihadists in a re-integration program. Think about that, the jihadists get the nice jail, because they are rehabilitatable: http://www.daviddegner.com/albums/terrorist-rehab-in-saudi-a...
Re: The Untold Story Behind Saudi Arabia’s U.S. Treasury Holdings
#63You can see from their reported figures that their U.S. treasury holdings are far too low for a sensible national portfolio. It's a pretty glaring hole, and you know that the money is going somewhere off the balance sheets. The question has always been how much U.S. debt exactly the Saudi's hold. This is an interesting historical anecdote, but it doesn't provide any information about the size of the debt, other than…
I think it's much more likely that the result will be an un-deniable public insistence on the right to sue the royal family. And if the Sauds can be sued for 9/11, the US can be sued for all the drone strikes and the like.
Win-win.
Re: The Untold Story Behind Saudi Arabia’s U.S. Treasury Holdings
#64There's a book called confessions of an economic hit man - https://en.wikipedia.org/wiki/Confessions_of_an_Economic_Hit... Essentially U.S. helps impoverished nations with infrastructure and other aid, but saddles them with debt in order to control them politically or otherwise. The interesting part was when it came to Saudi Arabia, which had so much money it didn't need to take on debt to develop their infrastructur…
The IMF primarily.
Yes the US takes part in that, but the organization is the IMF.
The IMF partially realizes their role in this, but its more of an outcome than a conspiracy. They've commented on that book in an interesting non-denial, basically saying that the GDP of the countries they've helped/subjected-in-a-giant-conspiracy is so low and such a small fraction of the IMF budget that it doesn't make sense that they would put much effort in it.
In any case, its just the terms of their contracts. Country can't pay, country must raise taxes or expropriate goods, or find natural resources.
Re: The Untold Story Behind Saudi Arabia’s U.S. Treasury Holdings
#65There's a book called confessions of an economic hit man - https://en.wikipedia.org/wiki/Confessions_of_an_Economic_Hit... Essentially U.S. helps impoverished nations with infrastructure and other aid, but saddles them with debt in order to control them politically or otherwise. The interesting part was when it came to Saudi Arabia, which had so much money it didn't need to take on debt to develop their infrastructur…
I'd love to hear more. Where you married? What was it like for you spouse? If not, what was the dating scene like in 82? Did you travel around any? What are the most interesting parts of the country? Did you ever make it to Mecca? How good are you at recognizing family names and power connections? Did that come with time? How did people in different parts of the country view each other? I just returned from a week in…
Someone a few weeks back recommended Inside The Kingdom in a reply to a comment of mine - I can strongly recommend it:
http://www.robertlacey.com/?q=book/inside-kingdom
It describes the length the Saudi's go to in rehabilitating jihadists - including getting them married!
Re: The Untold Story Behind Saudi Arabia’s U.S. Treasury Holdings
#66There's a book called confessions of an economic hit man - https://en.wikipedia.org/wiki/Confessions_of_an_Economic_Hit... Essentially U.S. helps impoverished nations with infrastructure and other aid, but saddles them with debt in order to control them politically or otherwise. The interesting part was when it came to Saudi Arabia, which had so much money it didn't need to take on debt to develop their infrastructur…
The student debt indenture system is the same thing in the microcosm.
Was does the debt force you to do other than hold a job? Heaven forbid. Nobody forced you to take money.
If anything it's a coup for politicians who want to push debt forgiveness as one of their platforms. Get everyone into debt and then offer forgiveness for votes.
Re: The Untold Story Behind Saudi Arabia’s U.S. Treasury Holdings
#67Earlier quoted context omitted.
I would prefer that instead of piking more heads we, the US, just bugger off. I have no issue with a strong military, I have a big concern with protecting countries or having bases in countries that have more than sufficient GDP to protect themselves. For the time being availability of oil for all nations through the Gulf states is as simple as keeping a US CV fleet or two in the area. It benefits all nations outside…
having bases in countries that have more than sufficient GDP to protect themselves As in Germany, the bases aren't there for the US to protect that country but the other way round: to ensure that country remains US-aligned.
Actually most of these bases are there because when there's trouble in those parts of the world, we need a place to be able to get troops, equipment and supplies into a given theater in a fast, efficient manner. The countries reap the economic benefits for sure, so it's a win/win situation for both countries. Not so much when the US starts cutting back on its military:
City officials in Heidelberg expect annual financial losses of up to $25 million, as a result of the closures of U.S. bases in the region.
"We estimate that a total of about 1,000 civilian jobs will be lost, when the nearly 8,000 service members pull out," said Diana Scharl, a spokesperson for the city of Heidelberg.
http://worldnews.nbcnews.com/_news/2012/06/30/12482964-bye-b...
I'd love for us to pull back from a lot of these areas, but let's face it, when one country invades another, they don't call France, Ireland, or Norway to help them do they? They expect the US to be the world's defender from the bad guys.
Re: The Untold Story Behind Saudi Arabia’s U.S. Treasury Holdings
#68Earlier quoted context omitted.
Swinging the election toward a hawkish demagogue with no knowledge of foreign policy does not seem like a desirable outcome for the United States either. It's worth noting that for now the Saudis still retain a bit of leverage. They could potentially start a kamikaze run on the dollar. They are our largest regional ally, and in very close proximity to Israel. We have very little knowledge of their nuclear program. Fi…
>hey could potentially start a kamikaze run on the dollar. I'm not so sure. Assuming they had several hundred billion dollars worth of Treasuries, and further assuming that they dumped them all on the market, the demand for USG debt is sufficiently large that I suspect it would be purchased in an orderly fashion without even causing much uptick in interest rates.
> ... I suspect it would be purchased in an orderly fashion
"Orderly fashion" and trading (algorithmic or otherwise) are oil and water, surely.
Re: The Untold Story Behind Saudi Arabia’s U.S. Treasury Holdings
#69Earlier quoted context omitted.
I'd rather have fiat currency than gold, because that would save me the time and hassle of selling the gold and getting something I can actually spend.
> I'd rather have fiat currency than gold, because that would save me the time and hassle of selling the gold and getting something I can actually spend. Isn't currency backed by commodities considered something other than fiat currency?
It's called the "gold standard".
Re: The Untold Story Behind Saudi Arabia’s U.S. Treasury Holdings
#70We pretty much put a price on our morality. Looking at the bond holders graph, it appears we owe about a 1/2-trillion dollars to oil producing nations. It's no wonder we tolerate tolerate gross human rights violations therein. Sort of like that J. Paul Getty Quote: "If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's problem." Makes me wonder if we have a similar deal wit…
We haven't sacrificed our industrial sector: