4 ms·
And to get the gold they will sell their own currency, just like they did for dollars. And the people they buy oil from will turn the gold into dollars to buy U
by LatteLazy 4y ago
And to get the gold they will sell their own currency, just like they did for dollars. And the people they buy oil from will turn the gold into dollars to buy US weapons and financial services (and treasury bills).
The ultimate effect will be the same except a lot more gold will have to be shipped around and some middle-men will get rich.
- fuzzfactor 4y agoNo. They have their own domestic source of gold. US dollars can only be minted in the USA so they have no domestic source of those, they're running low on dollars and they need them to purchase other international commodities besides petroleum.
- LatteLazy 4y agoSo instead of selling gold for dollars and then dollars for petroleum, they'll sell gold for petroleum. They won't have any more dollars than before. And they'll need to ship gold to countries that don't actually really want to, just for them to sell it for dollars. Still no free lunch. Still seems inefficient.
- fuzzfactor 4y agoDefinitely inefficient, but nobody has ever truly rejected gold since prehistoric times.