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Ghana plans to buy oil with gold instead of dollars

aljazeera.com

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Re: Ghana plans to buy oil with gold instead of dollars

#11

Post by dragonelite »

ur-whale wrote: post #6

The hegemony of the dollar as a reserve currency is finally coming to an end, and while many will disagree with my opinion, I believe it's a very good thing for the world. The US has been allowed by the rest of the world to use the dollar as a weapon since the end of WWII, specifically using it to impose unilateral economic sanctions on anyone they don't like, thereby flouting or downright ignoring other countries so…

Wondering what will replace it, maybe the Brics coin a basket of currencies and commodities. A bit like Keynes Bancor concept if i'm not mistaken time will tell what sort of currencies the Russians and Chinese will introduce for BRICS, SCO and BRI nations.

Re: Ghana plans to buy oil with gold instead of dollars

#12

Post by pwm »

I know a lot of people dislike bitcoin here but I'm wondering (with the huge assumption that its value stabilises over time) would it not actually be a better solution? Not just from an obvious logistical but also from an environmental perspective? I'd imagine gold mining to be much more destructive (both to nature and to human life).

Re: Ghana plans to buy oil with gold instead of dollars

#13

Post by ur-whale »

GoOnThenDoTell wrote: post #5

Im curious about the mechanics of how this helps, could they not sell the gold for dollars to buy the oil?

At some point in their history, the US unilaterally decided that any transaction occuring in dollars in any parts of the world was subject to US law.

In other words, they suddenly had granted themselves legitimacy to enforce US law anywhere on the planet as long as a single dollar changed hands.

As the US perceives itself as an empire, it makes complete sense from their POV.

But mayyybeeee, if you're in Ghana, you still cherish delusions of being a sovereign nation ...

Re: Ghana plans to buy oil with gold instead of dollars

#14

Post by pjc50 »

GoOnThenDoTell wrote: post #5

Im curious about the mechanics of how this helps, could they not sell the gold for dollars to buy the oil?

This. People seem very exercised about using the dollar specifically to buy oil, but .. currencies are fungible? You can trade them on international markets? Also, where does the gold come from? Is it just their central bank reserve?

No, it seems that Ghana is experiencing the classic forex problem of not being able to export enough valuable production in order to afford its imports, and it's very hard to reduce imports of fuel without drastic drops in either lifestyle or production capacity. And if you can't afford fuel to produce exports, then you have a death spiral.

Re: Ghana plans to buy oil with gold instead of dollars

#15

Post by pjc50 »

4pkjai wrote: post #8
GoOnThenDoTell wrote: post #5

Im curious about the mechanics of how this helps, could they not sell the gold for dollars to buy the oil?

I think the reason they want to avoid the US dollar is so that they do not need to obey US sanctions. From what I understand, if you send US dollars around the world, they need to go through a US bank. All US banks must obey US government sanctions.

Ghana are not subject to sanctions?

Re: Ghana plans to buy oil with gold instead of dollars

#16

Post by pjc50 »

ur-whale wrote: post #9
kaladin_1 wrote: post #3

Interesting the pressure is increasing. More and more countries questioning why they need to base their foreign transaction on the US Dollar. Could this mounting unrest be as a result of the seeming inability of the US Federal bank in checking inflation of the US Dollar. Also, some of these Nations can no longer determine what benefit it is to them is using the US Dollar as their reserve currency and trading currency…

>Do you see a country like Saudi going off the USD? Going off, certainly not (why would they?) But exchanging their oil for other currencies, absolutely. What will be interesting is how long the Sauds will remain in power once they agree to exchange their oil against other currencies. Historically, all regimes that made that decision were or are in the process of being taken down either directly by the US or a combo…

Russia's sanctions were as a result of their invasion of Ukraine and they'd still be a part of the normal financial system otherwise. It's nothing to do with petrodollars.

Re: Ghana plans to buy oil with gold instead of dollars

#17

Post by ur-whale »

dragonelite wrote: post #11
ur-whale wrote: post #6

The hegemony of the dollar as a reserve currency is finally coming to an end, and while many will disagree with my opinion, I believe it's a very good thing for the world. The US has been allowed by the rest of the world to use the dollar as a weapon since the end of WWII, specifically using it to impose unilateral economic sanctions on anyone they don't like, thereby flouting or downright ignoring other countries so…

Wondering what will replace it, maybe the Brics coin a basket of currencies and commodities. A bit like Keynes Bancor concept if i'm not mistaken time will tell what sort of currencies the Russians and Chinese will introduce for BRICS, SCO and BRI nations.

The Chinese Renminbi (Yuan) is a good candidate to quickly get on par with the USD.

If they manage it properly that is, as in: not print mountains of it, and not using it to enforce their political aims.

They're currently actively busy making the Renminbi reserve and default trading currency in much of Asia.

And, as a last resort, there's always Bitcoin and gold, although, as Ghana will discover (unless they make the mistake of using a 3rd-party custodian) gold is very tricky to move about.

Re: Ghana plans to buy oil with gold instead of dollars

#18

Post by ur-whale »

pjc50 wrote: post #16
ur-whale wrote: post #9

Earlier quoted context omitted.

>Do you see a country like Saudi going off the USD? Going off, certainly not (why would they?) But exchanging their oil for other currencies, absolutely. What will be interesting is how long the Sauds will remain in power once they agree to exchange their oil against other currencies. Historically, all regimes that made that decision were or are in the process of being taken down either directly by the US or a combo…

Russia's sanctions were as a result of their invasion of Ukraine and they'd still be a part of the normal financial system otherwise. It's nothing to do with petrodollars.

Apologies, but your reading of the situation is shallow.

What do you think led Vlad to invade?

The US has been mounting a proxy war against Russia in Ukraine for the past 20 years, one they're ready - barring political upheaval in the US - to fight down to the last European.

Re: Ghana plans to buy oil with gold instead of dollars

#19

Post by spaceman_2020 »

kaladin_1 wrote: post #3

Interesting the pressure is increasing. More and more countries questioning why they need to base their foreign transaction on the US Dollar. Could this mounting unrest be as a result of the seeming inability of the US Federal bank in checking inflation of the US Dollar. Also, some of these Nations can no longer determine what benefit it is to them is using the US Dollar as their reserve currency and trading currency…

If you look at the actual numbers, you'll find that USD dominance is still unchallenged.

BUT, there is definitely way more chatter about alternative payment options, including from well-placed government sources and central banks in important non-west allied countries.

It's now a matter of "when", not "if" when an alternative currency pops up, maybe a BRICS currency.

Re: Ghana plans to buy oil with gold instead of dollars

#20

Post by ben_w »

kaladin_1 wrote: post #3

Interesting the pressure is increasing. More and more countries questioning why they need to base their foreign transaction on the US Dollar. Could this mounting unrest be as a result of the seeming inability of the US Federal bank in checking inflation of the US Dollar. Also, some of these Nations can no longer determine what benefit it is to them is using the US Dollar as their reserve currency and trading currency…

I'm only at the level of guessing for topics like this, but my guess is that a chain reaction is more likely to see a switch from USD to Renminbi than a switch to gold (or Euros).

China because of the potential assuming similar GDP/capita as the current USA.

Not soon because I expect as a prerequisite for change being the new winner's GDP to be dominant rather than just joint top 3 in a ranking system that changes their ordering depending on what you value most.

Not gold because the justifications given for why we all stopped using the gold standard in the fist place, still seem to apply.

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