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EU and Iran agree on new payment system to skirt US sanctions

danmand

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EU and Iran agree on new payment system to skirt US sanctions
Five world powers and Iran agree to set up legal entity to circumvent US sanctions after Trump pullout from 2015 deal.

In a major snub to the United States, the European Union has decided to set up a new mechanism to enable legal trade with Iran without encountering US sanctions.

The EU will create new payment channels to preserve oil and other business deals with Iran, Federica Mogherini, the bloc's foreign policy chief said late on Monday, in a bid to evade US punitive measures.

US President Donald Trump withdrew from a 2015 nuclear deal in May and re-imposed sanctions on the country.

Mogherini's announcement came after a meeting with foreign ministers from Britain, France, Germany, Russia, China, and Iran on the sidelines of the United Nations General Assembly in New York.

"In practical terms this will mean that EU member states will set up a legal entity to facilitate legitimate financial transactions with Iran and this will allow European companies to continue to trade with Iran in accordance with European Union law and could be open to other partners in the world," she told reporters after the closed-door meeting.


Understanding the Iran deal: What, why and the next steps
The EU, along with Russia and China, said in a joint statement that the so-called "Special Purpose Vehicle" will "assist and reassure economic operators pursuing legitimate business with Iran".

The statement added that the six countries signatory to the 2015 nuclear agreement "reconfirmed their commitment to its full and effective implementation in good faith and in a constructive atmosphere".

2015 nuclear deal
Known formally as the Joint Comprehensive Plan of Action (JCPOA), the Iran nuclear deal ended a nearly 12-year standoff between Iran and Western powers in 2015.

It was spearheaded by the Obama administration and saw the lifting of international sanctions.


WATCH: The future of Iran nuclear deal after new US sanctions (3:10)
The nuclear agreement is meant to prevent Tehran from developing nuclear weapons, but Trump announced in May he was unilaterally pulling out because he felt it wasn't strong enough and didn't cover other issues of concern to the US and its allies, such as Iran's military influence in the Middle East and its ballistic missile programme.

The US has also accused Iran of promoting international terrorism, a charge Tehran vehemently denies.

A second round of US sanctions is expected in November, aimed at putting a stranglehold on Iranian oil exports.

Meanwhile, the EU has vowed to stick with the deal and updated legislation to protect European companies from future sanctions.

The EU, US allies and the international nuclear watchdog IAEA maintain that Iran continues to abide by the terms of the agreement.

'Last chance'
Mogherini said on Monday the decision to set up such a vehicle had already been taken and that technical experts would meet again to flesh out the details.

Al Jazeera's Shihab Rattansi, reporting from the UN headquarters in New York, said the new entity will act as a "clearing house, a middleman, so to speak, between Europeans and Iranians as they try to do business."

READ MORE
The art of the Iranian deal: How Trump can talk to Tehran
"If the Italians want to buy some Iranian oil, they will wire the money to this entity which will then handle the financial transactions from there and vice versa," he said.

"There will be no involvement of commercial banks and central banks, both of whom are terrified at the prospect of US retribution if they are seen to be going against US sanctions."

Rodger Shanahan, a research fellow at the Lowry Institute for International Policy, called the EU agreement "a poke in the eye for the US".

"I think it reflects the kind of the attitude that the Europeans have had about the decision by President Trump," he told Al Jazeera in an interview from Sydney, Australia.

"They have been quite upset about going against international norms of pulling out of the agreement. At the same time, all external auditors have found that Iran has been complying with the agreement.

"So the Europeans want to try and save the agreement and they're seeing this as really the last chance."

'Math on Iran's side'
The EU move came a day before Trump and Iranian President Hassan Rouhani separately address the UN General Assembly on Tuesday, with the US leader expected to take a hard line on Iran.

"Iranian leaders are likely to be seen pushing their partners - the four remaining signatories plus one - to try to save some of the economic benefits from the nuclear deal," said Al Jazeera's Zein Basravi, reporting from the Iranian capital, Tehran.

Despite opposition from the EU, a number of businesses including French energy giant Total and carmakers Peugeot and Renault as well as Germany's Siemens and Daimler have already suspended operations in Iran for fear of triggering US sanctions.

But Iranian officials have told Al Jazeera that up until now oil sales have more or less remained the same, Basravi reported.

"International demand and market forces dictate that the math is on Iran's side," he said.

"So, unless the Trump administration and the White House are willing to accept a price hike, unless the international market is willing to see oil prices go up, then really the math will remain on Iran's side and oil sales are not expected to fall."
 

Aardvark154

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Trying to poke the eagle in its eyes will likely prove a foolish move on the part of Federica Mogherini.
 

danmand

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Trying to poke the eagle in its eyes will likely prove a foolish move on the part of Federica Mogherini.
Imperial overreach is back firing on Trump.
 

nottyboi

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Trying to poke the eagle in its eyes will likely prove a foolish move on the part of Federica Mogherini.
Federica is not poking the eagles eyes, she is just the face of the EU, Russia AND China....and India telling America to fuck off.
 

Frankfooter

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On the same day that the UN laughed at Trump.
SAD day for the US.

Trump is a laughing stock.
 

onthebottom

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Currency markets were not impressed.

Pompeo Slams EU Plan to Help Companies Skirt US Sanctions on Iran
U.S. Secretary of State Mike Pompeo on Tuesday criticized a European Union plan to help European companies do business with Iran as they face the prospect of U.S. sanctions that could punish them for such trade.

In a speech in New York to the U.S. advocacy group United Against a Nuclear Iran, Pompeo called the EU plan "one of the most counterproductive measures imaginable for regional global peace and security."

The plan, announced late Monday at the United Nations on the sidelines of the General Assembly, calls for the creation of a "Special Purpose Vehicle" (SPV) to enable companies in the EU to make payments for Iranian exports such as oil.

Partners to Iran nuclear deal

The announcement came in a statement by Iran and the five remaining parties to the 2015 Iran nuclear deal — EU members Britain, France and Germany, plus Russia and China.

In May, U.S. President Donald Trump withdrew from the Iran nuclear deal that his predecessor signed and started a monthslong process of reimposing U.S. sanctions that had been suspended under that agreement. Trump said he wanted to pressure Iran into giving up what he said were its nuclear weapons ambitions and other malign activities. Iran denies seeking nuclear weapons.

Speaking to reporters after the SPV announcement, EU foreign policy chief Federica Mogherini said it would give EU member states "a legal entity to facilitate legitimate financial transactions with Iran ... and allow European companies to continue to trade with Iran in accordance to European Union law, and could be open to other partners in the world."

Mogherini said the move was aimed at preserving the 2015 deal, under which Iran agreed to suspend certain nuclear activities in return for international sanctions relief.

A protester holding a sign that says "Peace with Iran" is escorted out of the room during U.S. Secretary of State Mike Pompeo's remarks during the United Against Nuclear Iran Summit on the sidelines of the U.N. General Assembly in New York, Sept. 25, 2018.
A protester holding a sign that says "Peace with Iran" is escorted out of the room during U.S. Secretary of State Mike Pompeo's remarks during the United Against Nuclear Iran Summit on the sidelines of the U.N. General Assembly in New York, Sept. 25, 2018.
In his Tuesday remarks, Pompeo said he was "disturbed and … deeply disappointed" by the EU plan. The Trump administration has urged the EU to abide by U.S. sanctions being reimposed on Iran and has warned that entities who trade with Iran in violation of those restrictions will face secondary U.S. sanctions.

Pompeo said he imagined that Iran's "corrupt ayatollahs and the IRGC [Islamic Revolutionary Guard Corps] were laughing this morning" when they heard about the SPV.

"By sustaining revenues to the regime, you are solidifying Iran's ranking as the No. 1 state sponsor of terror, enabling Iran's violent export of revolution and making the regime even richer, while the Iranian people scrape by," Pompeo said.

Iran has said it is a victim of terrorism rather than a perpetrator.

UNGA speech

Earlier Tuesday in a speech to the U.N. General Assembly, Trump highlighted his policy of reimposing U.S. sanctions against Iran and said he was working with countries that import Iranian oil to cut their purchases "substantially."

"We ask all nations to isolate Iran's regime as long as its aggression continues. And we ask all nations to support Iran's people as they struggle to reclaim their religious and righteous destiny," Trump said.

In a live appearance on the Tuesday edition of VOA Persian's News at Nine show, Hudson Institute analyst Michael Pregent said the key element of Trump's Iran comments was his pledge to intensify the sanctions.

"The United States is encouraging the West and urging the international community to support [anti-government] protesters in Iran and continue to put pressure on Iran through sanctions," Pregent said.

Shortly after Trump's speech, Iran's rial weakened to a record low against the dollar for a second straight day.

Screenshot of the Bonbast.com website that tracks Iran’s unofficial exchange rates. It showed the Iranian currency at a record low of 17,000 tomans, or 170,000 rials, to the dollar on Sept. 25, 2018.
Screenshot of the Bonbast.com website that tracks Iran’s unofficial exchange rates. It showed the Iranian currency at a record low of 17,000 tomans, or 170,000 rials, to the dollar on Sept. 25, 2018.
The Bonbast.com website, which tracks Iran's unofficial exchange rates, showed a new low of 17,000 tomans, or 170,000 rials, to the dollar Tuesday. The rial has lost much of its value in recent months as Iranians have sold the currency because of concerns about the impact of U.S. sanctions on an Iranian economy already struggling with high inflation and unemployment.

In another interview on VOA Persian's News at Nine, Foundation for Defense of Democracies analyst Emanuele Ottolenghi expressed doubt that Iran's domestic problems would force its ruling Islamic clerics to change their foreign policy.

"Iran's involvement [in Middle East conflicts] is a core interest of the Iranian regime, and it has been so at the height of the [previous international] sanctions regime [against Iran]," Ottolenghi said, noting Iran's material support for Syrian President Bashar al-Assad, a regional ally, at the start of the Syrian civil war in 2011. "That was a time of extreme economic difficulties [in Iran], and the regime prioritized that [policy], so I doubt that the economic circumstances in Iran now are going to dictate a different path."
 

Big Sleazy

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The move away from the USD in trade settlement has been going on for years. Since 2004. It's been accelerating with China, Russia, and Iran. Now the EU ( which I despise ) is talking about it openly. If your allies are talking about it openly, then a big change is likely coming soon. It may end up coming thru War like the previous monetary systems. In which case good luck to all. But it is coming as sure as night follows day. Besides, it's always been the Globalists plan to get rid of the USA. They despise any Republic and especially one with a Constitution. They've already destroyed that. Wrecked the US Industrial base. Now it's just a matter of dumping the US Treasuries. The re-build will take decades.
 

danmand

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The move away from the USD in trade settlement has been going on for years. Since 2004. It's been accelerating with China, Russia, and Iran. Now the EU ( which I despise ) is talking about it openly. If your allies are talking about it openly, then a big change is likely coming soon. It may end up coming thru War like the previous monetary systems. In which case good luck to all. But it is coming as sure as night follows day. Besides, it's always been the Globalists plan to get rid of the USA. They despise any Republic and especially one with a Constitution. They've already destroyed that. Wrecked the US Industrial base. Now it's just a matter of dumping the US Treasuries. The re-build will take decades.
Agreed. The only thing that puzzles me is that USA actively are pushing countries of the $US system, they themselves have put in place, and which has benefited USA enormously.

Why would USA want to get countries off the $US? Unbelievable.
 

Big Sleazy

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I'm not sure that having the World's Reserve currency status is such an advantage. You have to defend it with a bloated Military budget. Money that could have been invested inside the Country instead. The reality is that a floating exchange rate only benefits Bankers and certain wealthy owners. But it does nothing for every other Country that is pegged to the USD. We now have a roughly World GDP of 80 trillion. World debt at 250 trillion...roughly. And a derivative complex of some 1.5 QUADRILLION. This money can not ever be repaid. It's not possible. We are approaching the end of the Keynsian fiat monetary experiment. When Keynes was told by his colleagues when Bretton Woods was instituted that the system would eventually fail he replied..." Yes, but we'll all be dead by then ". America defaulted on it's debt in 1971 when Nixon closed the Gold window. The system collapsed again in 2008. The only thing that propped it up was a massive infusion of cash by the Fed. Ten years later we are about to collapse again. And there is no amount of money that can be printed that can save the broken system. That's is why the BIS has stated in BASIL III rulings that as of January 2019, Physical Gold is considered a Tier 1 "AAA" rated asset alongside US Treasuries.

Printing more fiat dollars is not going to save us this time. They will have to allow Gold to be re=priced considerably higher and the bad debt to be written off. Just pray it doesn't come with WWIII. Any which way, there is a lot of pain coming. They could have allowed the system to re-set in 2008. They didn't. Since then the uber wealthy have become more wealthy with the acquisition of real assets. They'[re going to save themselves while the lower class and middle class die. Likely from starvation. We'll need some big boy's at the table to resolve things. Not the likes of our existing Political class. But real men and women with guts and vision. Not people that order Indian take out from B.C while being in New Delhi !
 

toguy5252

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Currency markets were not impressed.

Pompeo Slams EU Plan to Help Companies Skirt US Sanctions on Iran
U.S. Secretary of State Mike Pompeo on Tuesday criticized a European Union plan to help European companies do business with Iran as they face the prospect of U.S. sanctions that could punish them for such trade.

In a speech in New York to the U.S. advocacy group United Against a Nuclear Iran, Pompeo called the EU plan "one of the most counterproductive measures imaginable for regional global peace and security."

The plan, announced late Monday at the United Nations on the sidelines of the General Assembly, calls for the creation of a "Special Purpose Vehicle" (SPV) to enable companies in the EU to make payments for Iranian exports such as oil.

Partners to Iran nuclear deal

The announcement came in a statement by Iran and the five remaining parties to the 2015 Iran nuclear deal — EU members Britain, France and Germany, plus Russia and China.

In May, U.S. President Donald Trump withdrew from the Iran nuclear deal that his predecessor signed and started a monthslong process of reimposing U.S. sanctions that had been suspended under that agreement. Trump said he wanted to pressure Iran into giving up what he said were its nuclear weapons ambitions and other malign activities. Iran denies seeking nuclear weapons.

Speaking to reporters after the SPV announcement, EU foreign policy chief Federica Mogherini said it would give EU member states "a legal entity to facilitate legitimate financial transactions with Iran ... and allow European companies to continue to trade with Iran in accordance to European Union law, and could be open to other partners in the world."

Mogherini said the move was aimed at preserving the 2015 deal, under which Iran agreed to suspend certain nuclear activities in return for international sanctions relief.

A protester holding a sign that says "Peace with Iran" is escorted out of the room during U.S. Secretary of State Mike Pompeo's remarks during the United Against Nuclear Iran Summit on the sidelines of the U.N. General Assembly in New York, Sept. 25, 2018.
A protester holding a sign that says "Peace with Iran" is escorted out of the room during U.S. Secretary of State Mike Pompeo's remarks during the United Against Nuclear Iran Summit on the sidelines of the U.N. General Assembly in New York, Sept. 25, 2018.
In his Tuesday remarks, Pompeo said he was "disturbed and … deeply disappointed" by the EU plan. The Trump administration has urged the EU to abide by U.S. sanctions being reimposed on Iran and has warned that entities who trade with Iran in violation of those restrictions will face secondary U.S. sanctions.

Pompeo said he imagined that Iran's "corrupt ayatollahs and the IRGC [Islamic Revolutionary Guard Corps] were laughing this morning" when they heard about the SPV.

"By sustaining revenues to the regime, you are solidifying Iran's ranking as the No. 1 state sponsor of terror, enabling Iran's violent export of revolution and making the regime even richer, while the Iranian people scrape by," Pompeo said.

Iran has said it is a victim of terrorism rather than a perpetrator.

UNGA speech

Earlier Tuesday in a speech to the U.N. General Assembly, Trump highlighted his policy of reimposing U.S. sanctions against Iran and said he was working with countries that import Iranian oil to cut their purchases "substantially."

"We ask all nations to isolate Iran's regime as long as its aggression continues. And we ask all nations to support Iran's people as they struggle to reclaim their religious and righteous destiny," Trump said.

In a live appearance on the Tuesday edition of VOA Persian's News at Nine show, Hudson Institute analyst Michael Pregent said the key element of Trump's Iran comments was his pledge to intensify the sanctions.

"The United States is encouraging the West and urging the international community to support [anti-government] protesters in Iran and continue to put pressure on Iran through sanctions," Pregent said.

Shortly after Trump's speech, Iran's rial weakened to a record low against the dollar for a second straight day.

Screenshot of the Bonbast.com website that tracks Iran’s unofficial exchange rates. It showed the Iranian currency at a record low of 17,000 tomans, or 170,000 rials, to the dollar on Sept. 25, 2018.
Screenshot of the Bonbast.com website that tracks Iran’s unofficial exchange rates. It showed the Iranian currency at a record low of 17,000 tomans, or 170,000 rials, to the dollar on Sept. 25, 2018.
The Bonbast.com website, which tracks Iran's unofficial exchange rates, showed a new low of 17,000 tomans, or 170,000 rials, to the dollar Tuesday. The rial has lost much of its value in recent months as Iranians have sold the currency because of concerns about the impact of U.S. sanctions on an Iranian economy already struggling with high inflation and unemployment.

In another interview on VOA Persian's News at Nine, Foundation for Defense of Democracies analyst Emanuele Ottolenghi expressed doubt that Iran's domestic problems would force its ruling Islamic clerics to change their foreign policy.

"Iran's involvement [in Middle East conflicts] is a core interest of the Iranian regime, and it has been so at the height of the [previous international] sanctions regime [against Iran]," Ottolenghi said, noting Iran's material support for Syrian President Bashar al-Assad, a regional ally, at the start of the Syrian civil war in 2011. "That was a time of extreme economic difficulties [in Iran], and the regime prioritized that [policy], so I doubt that the economic circumstances in Iran now are going to dictate a different path."
You seem to think that the answer to all issues is revealed in the Dow or currency markets.
 

onthebottom

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You seem to think that the answer to all issues is revealed in the Dow or currency markets.
It’s often helpful to check a hypothesis with the real world. I highly recommend it.
 

onthebottom

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One more reminder that the US dollar is dominant

The title of the world's worst-performing currency is a surprisingly competitive contest this year. As it stands, Argentina's peso holds the crown, having lost more than half its value since January. Right behind is the Turkish lira. South Africa's rand also makes it into the top five. While there are certainly distinct, home-grown problems at fault, each crisis serves as a reminder that the US dollar remains the singularly dominant global currency and will remain so for some time.

All three economies face some kind of external or fiscal imbalance (or both), FX reserves are typically in short supply, and many are on shaky political footing. An autocrat who doesn't believe in economic orthodoxy runs Turkey. And Argentina's President Macri is potentially staring at defeat ahead of a general election next fall as he enacts politically explosive austerity cuts.

The most important thing they all share, however, is a reliance on the US dollar. Using cross-border bank lending data from the Bank of International Settlements (BIS), Paul Meggyesi of JPMorgan shows just how much the global financial system depends on the greenback. Nearly half of FX funding at a global level is dollar-denominated. The euro trails at a distant second, comprising 29 per cent of cross-border FX bank claims. The Japanese yen, British pound and Swiss franc are each in the single-digits. While Meggyesi does note that the dollar's outsized role is less pronounced when cross-border claims are scaled as a percentage of GDP, it still remains the dominant funding currency. About 70 per cent of local GDP is denominated in dollars, euros and Swiss francs.

When it comes to the issuance of FX-denominated debt globally, the dollar's dominance is even more noticeable. Using BIS data of cross-border bank claims on non-banks and non-residents, as well as non-bank issuance of FX-denominated debt, Meggyesi calculates that the greenback's global cross-border funding is three times as large as euro funding. In other words (and ignoring the fact that an unknown amount of this debt is hedged), the world is “short” roughly $11.5trn, compared to $3.5trn worth of euros and $0.39trn of Japanese yen:


Narrow the focus strictly to emerging markets, which saw the largest uptick in dollar funding since 2008 (128 per cent v 84 per cent for developed markets), and total dollar-denominated credit trumps euro funding by five to one:


Cheap dollar funding, however, comes at a price. Christian Keller and Tomasz Wieladek of Barclays summarise the dilemma undermining most emerging market currencies today:

In the past, the pressure from rising USD rates could be offset by the positive effect of a robustly growing US economy that sucked in imports and supported commodity prices. While the commodity-supporting role has already largely passed to China, the current US policy mix is still potentially poisonous for EM: it curbs the positive trade effect from US growth (though tariffs), while boosting domestic demand (through tax cuts), which in turn drives USD interest rates higher, incentivising capital to flow back home.
Add to this the Federal Reserve's rate hikes this year and next, as well as the drying up of global liquidity more broadly, and it's no surprise that high levels of indebtedness across emerging markets have caused some panic. Here's a Barclays chart showing the extent of exposure:


And beyond funding, the dollar, as Macquarie's Viktor Shvets puts it, remains the “undisputed global standard of value”. One look at its share of global foreign exchange reserves proves the point. According to the IMF, it comprises some 60 per cent. The euro follows with 20 per cent. And China's currency? Just over 1 per cent.

https://goo.gl/images/gL8pKC
 

danmand

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Nov 28, 2003
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One more reminder that the US dollar is dominant

The title of the world's worst-performing currency is a surprisingly competitive contest this year. As it stands, Argentina's peso holds the crown, having lost more than half its value since January. Right behind is the Turkish lira. South Africa's rand also makes it into the top five. While there are certainly distinct, home-grown problems at fault, each crisis serves as a reminder that the US dollar remains the singularly dominant global currency and will remain so for some time.

All three economies face some kind of external or fiscal imbalance (or both), FX reserves are typically in short supply, and many are on shaky political footing. An autocrat who doesn't believe in economic orthodoxy runs Turkey. And Argentina's President Macri is potentially staring at defeat ahead of a general election next fall as he enacts politically explosive austerity cuts.

The most important thing they all share, however, is a reliance on the US dollar. Using cross-border bank lending data from the Bank of International Settlements (BIS), Paul Meggyesi of JPMorgan shows just how much the global financial system depends on the greenback. Nearly half of FX funding at a global level is dollar-denominated. The euro trails at a distant second, comprising 29 per cent of cross-border FX bank claims. The Japanese yen, British pound and Swiss franc are each in the single-digits. While Meggyesi does note that the dollar's outsized role is less pronounced when cross-border claims are scaled as a percentage of GDP, it still remains the dominant funding currency. About 70 per cent of local GDP is denominated in dollars, euros and Swiss francs.

When it comes to the issuance of FX-denominated debt globally, the dollar's dominance is even more noticeable. Using BIS data of cross-border bank claims on non-banks and non-residents, as well as non-bank issuance of FX-denominated debt, Meggyesi calculates that the greenback's global cross-border funding is three times as large as euro funding. In other words (and ignoring the fact that an unknown amount of this debt is hedged), the world is “short” roughly $11.5trn, compared to $3.5trn worth of euros and $0.39trn of Japanese yen:


Narrow the focus strictly to emerging markets, which saw the largest uptick in dollar funding since 2008 (128 per cent v 84 per cent for developed markets), and total dollar-denominated credit trumps euro funding by five to one:


Cheap dollar funding, however, comes at a price. Christian Keller and Tomasz Wieladek of Barclays summarise the dilemma undermining most emerging market currencies today:

In the past, the pressure from rising USD rates could be offset by the positive effect of a robustly growing US economy that sucked in imports and supported commodity prices. While the commodity-supporting role has already largely passed to China, the current US policy mix is still potentially poisonous for EM: it curbs the positive trade effect from US growth (though tariffs), while boosting domestic demand (through tax cuts), which in turn drives USD interest rates higher, incentivising capital to flow back home.
Add to this the Federal Reserve's rate hikes this year and next, as well as the drying up of global liquidity more broadly, and it's no surprise that high levels of indebtedness across emerging markets have caused some panic. Here's a Barclays chart showing the extent of exposure:


And beyond funding, the dollar, as Macquarie's Viktor Shvets puts it, remains the “undisputed global standard of value”. One look at its share of global foreign exchange reserves proves the point. According to the IMF, it comprises some 60 per cent. The euro follows with 20 per cent. And China's currency? Just over 1 per cent.

https://goo.gl/images/gL8pKC
We all agree that the $US system put in place by USA after WW II is a brilliant scheme, that has benefited USA enormously. What would the living standard have been in USA today, if it had to buy goods from China in return for goods instead of paper (or electronic numbers)? There would have been at least a $200B deficit of goods to consume by USA citizens. And that is only China.

That is why it puzzles me greatly that USA actively are pushing countries of the $US system. Why would USA want to get countries off the $US? It is unbelievable unbelievable.
 

onthebottom

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We all agree that the $US system put in place by USA after WW II is a brilliant scheme, that has benefited USA enormously. What would the living standard have been in USA today, if it had to buy goods from China in return for goods instead of paper (or electronic numbers)? There would have been at least a $200B deficit of goods to consume by USA citizens. And that is only China.

That is why it puzzles me greatly that USA actively are pushing countries of the $US system. Why would USA want to get countries off the $US? It is unbelievable unbelievable.
I don’t think you are being sincere but I may be giving you too much credit.

The US is exerting it’s leverage, both on the value of the US as an export market, and the use of the US banking system.

The administration was clear this week, companies will need to chose, trade with Iran or the US.
 

danmand

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Nov 28, 2003
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I don’t think you are being sincere but I may be giving you too much credit.

The US is exerting it’s leverage, both on the value of the US as an export market, and the use of the US banking system.

The administration was clear this week, companies will need to chose, trade with Iran or the US.
I am serious, that I think includes sincere. I simply do not understand why USA is forcing or encouraging other countries to exit the $US system.

I think eventually the $US hegemony would disappear, any system eventually does, but why on earth would USA want to speed it up.
 

onthebottom

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I am serious, that I think includes sincere. I simply do not understand why USA is forcing or encouraging other countries to exit the $US system.

I think eventually the $US hegemony would disappear, any system eventually does, but why on earth would USA want to speed it up.
They are not encouraging or forcing. They are leveraging the reality that they have leverage and are using it.

I think you’ll find very few companies will chose Iran over the US.
 

nottyboi

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May 14, 2008
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They are not encouraging or forcing. They are leveraging the reality that they have leverage and are using it. I think you’ll find very few companies will chose Iran over the US.
If that is a choice that the US can force them to make, that remains to be seen. If a European company sells goods to the German Govt and those goods end up in Iran...who do they sanction? If Iran sells oil to a faceless European company in Euros, and is paid in Euro credits into a black account in a SPV, and it delivers it to a refinary in a ship with transponders turned off or spoofed how to you track that? In the meantime all that trade which used to be conducted in US$ is now being done in Euros, Yuan, Roubles and pounds....then it gets to be a habit and when all the sanctions are gone, people decide, lets keep the SPV and now call it SWIFT II non-US$ payment system. WOO HOO!!!
 

onthebottom

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If that is a choice that the US can force them to make, that remains to be seen. If a European company sells goods to the German Govt and those goods end up in Iran...who do they sanction? If Iran sells oil to a faceless European company in Euros, and is paid in Euro credits into a black account in a SPV, and it delivers it to a refinary in a ship with transponders turned off or spoofed how to you track that? In the meantime all that trade which used to be conducted in US$ is now being done in Euros, Yuan, Roubles and pounds....then it gets to be a habit and when all the sanctions are gone, people decide, lets keep the SPV and now call it SWIFT II non-US$ payment system. WOO HOO!!!
Nice story, meanwhile in the real world....

https://terb.cc/vbulletin/showthread.php?646174-After-Sanctions-Iran%92s-Economy-Is-Nearing-a-Crisis
 
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