Crisis of the American dollar
Which
direction to be given to
“American monetary serum”
INTRODUCTION
A
study that I developed bearing on finances and hydrocarbons appeared in
the Algerian newspaper “El Watan” of Monday September 11 to September
16, 2000 in heading IDEES-DEBAT, under the title “the euro in the new world monetary order”.
Slightly altered in March 2008 in the site
“Studies and Futurologies. International
relations” or http://66.196.80.202/babelfish/translate_url_content?.intl=fr&lp=fr_en&trurl=http%3a%2f%2fwww.medjdoub.com%2f,
putting forward the conflict which opposes two banks of the Atlantic on
the monetary level since decades, the title besides of this study was
taken again and entitle as follows “OIL AND
FINANCES. Monetary war between two banks of the Atlantic”, forces today to
note that the flight of the barrel of petrol did not last 6 months, one
year, even two years as I wrote in 2000, but much more, “nearly nine years since the launching of the euro in
1999”. Moreover the barrel a record moreover 111 reached dollars
in March 2008 while the euro was strongly appreciated and approaches
absolute records, one euro for 1,60 dollar. Another intruder came to
complicate gives it monetary, it is the Chinese currency, the yuan. The
foreign exchange rate of the yuan does not reflect the fundamental ones
of China. Finally the real crisis which has occurred in the United
States (crisis of the subprimes) at the summer 2007, combined with the
office pluralities of the American current account deficits since 1990,
makes the economic situation world even more confused.
1. A decoupling of the worldwide
economy?
The course of the US economy leave
perplexed, an odd tendency appears, being the subject of many critical,
as well scientific controversies as empirical. The need for indicators
of the policy of the economic situation American comes from the concern
which have the economists to evaluate this policy and its during,
worldwide economy, in time. However the macro-economic indicators which
appear on the theoretical and practical level, do not bring sufficient
lighting to include/understand the evolution of the worldwide economy,
so much the data which arise are contradictory.
One speaks
for example, today, of prospects turned over for the Western economies.
Indeed, the financial crisis, the excessive
appreciation of the euro and the hardening of the credit terms
make weigh threats on the perenniality of the eurolandaise activity and
American. While the other economies in particular that of the countries
emergent, know, they, a phase of durably strong growth. Each one with
its forces, resist the deceleration of the Western economies. Thus, the
countries of Asia under the crook of China, the Latin America
benefitting from a political stability, the countries of Eastern Europe,
profiting from a better integration to the continental economy, and
finally those of the Middle-East and Russia (more generally all raw
material producers), benefitting from the oil manna to instigate their
economies, become less dependent on the American economic activity. Many
experts of gives world see there there, a beginning of decoupling
between the world growth and American consumption. If this approach can
appear plausible, it remains however that many shades can affect this
optimistic table.
2. Pragmatic
approach
Put aside the
optimistic analyses or pessimist on the evolution of gives economic
world experts of any horizon, is not there more simplified vision, more
pragmatic, more speaking, on this complex puzzle of economic forces,
financial and monetary emanating from various continents. They
intermingle inside the same work - the world commerce - whose sometimes
obscure bonds confer on the unit an aspect often not very readable
especially on the monetary level.
By schematizing the evolution, by dissociating the factors of the unit,
energy of simple to the complex, partial visions to the comprehensive
view, cannot one give an account of a better idea of the involved
forces, even if the words borrowed to describe the phenomena can appear
shocking.
This being, let us use
of the virtues of the pragmatic method, the words whose direction could
not be disputed if it involves adhesion and the conviction in what
drives the places and financial markets and monetarists in the
world.
Everyone or at least those
which follow the course of the American dollar, remember that, since the
end 2002, the US dollar was strongly depreciated vis-a-vis the euro.
What resulted in a considerable escape of capital, in particular
European out of the United States, and this is comprehensible to count
held of the fear of losses on transactions on foreign currency on behalf
of the foreign investors. This escape, one remembers, was replaced about
it massively by capital from Asia and from the Middle East (especially
of the Arab countries). The US economy could continue its growth
and regulate its trade deficits and budgetary by what one can call a
“monetary anomaly”. Why “anomaly”? This is known as in
the sense that the support of the American growth was maintained
artificially initially by the national consumption, evaluated with more
half of the American GDP, then by the help of this capital for the
reinflation of the trade balance and budgetary American. Moreover this
“anomaly” is generated in the United States even since this
country is the transmitter. Not that the dollar is a “anomaly”
but it became it by the part which it plays in the transmission of the
“monetary and financial fever” in the world.
Countries of Asia from which China and Japan, have
American market need to dope their growth, their concern is that the US
market is maintained solvent, from where this Asian frenzy to place the
trade surpluses in American goods of Treasure. The same applies to the
countries of the Middle East, incompetents to consume their financial
surpluses, resulting from their oil revenues in economic investments
(put aside of great public works), they turn all worms the US
market.
From 2003 to 2007, the
width of this monetary doping involved a fever in the United States, to
finish at the summer 2007 in a real and financial crisis considerable.
The monetary injection by the central institutions to be opposed to the
financial crisis, if it attenuates the economic deceleration, will to
tell the truth make only prolong this fever. For the first time, in
addition to oil and gold, this fever also extends to the raw materials.
Monetary injection by the Central banks (the ECB and other European
Central banks follow the EDF American) not having other choices to only
place itself everywhere where there is imbalance. However, the raw
materials with the strong fall of the dollar cannot that to be
readjusted with the news gives monetary. But, as soon as the price of
the raw materials is adjusted during the dollar, an injection even more
massive of dollars inevitably in the long term will corrupt even those
which are regarded as healthy, i.e. the emergent countries in which
China occupies a central place, have regard to the surpluses of the
trade balance. The fever then will be world. The raw materials will not
have other alternatives to only go up to still reach other tops. One
speaks already about the course of the yellow metal which can fly away
with 2000 dollars, a course of the barrel which can exceed the 200
dollars and an euro which can be worth two dollars and
more.
What is it of this
“monetary anomaly”? America will cure it the evil by the evil.
A “monetary anomaly” can be well cured by itself. By inject,
there will be nothing any more to inject, any injection has limits
because the result will appear with long vain. The “monetary
serum” will not be able to play any more, because it is indeed a
“serum” that the Western Central banks use to revive
their economies. That could play front, in the crises passed, the crisis
of confidence of the trade banks and of businesses could be exceeded by
massive monetary injections. Today the “monetary anomaly is
used by L “Asia”, since it goes back it to the Occident in the
form of ackowledgement of debt, thus generating serious imbalances in
the world. There are strong chances that the “serum” and the
“monetary anomaly” merge to constitute frightening mixture
explosive. The dollar crisis will start an irreversible process
then.
3. Towards a
“confrontation”?
This being,
which will leave these two winds which are the same ones and at the same
time opposites? Is there a wire of ARIANE in this set of contrary
forces? And if, in spite of all, while leaving this reasoning, that it
is finally only one movement “towards an economic
homogenisation” of the world. As it goes from there in the bringing
together of the cultures and the companies? And what it is not a
question of “confrontation” between the large economic
poles.
And if we go towards “a
confrontation” as certain “right-thinking people suggest
it”? About which “confrontation” one speaks? When it
is known that a power as the ex-USSR with all its arsenal was put in
failure in Afghanistan. It even lost the war in Afghanistan. Two years
after, the world power burst, the USSR did not exist
more.
The same applies to the first
world power to Iraq. The United States lives another disaster from
Vietnam. In Afghanistan, this super power with the largest organization
of the world - NATO, a coalition of Economic powers and soldiers - took
the changing. Soon eight years, this super power and its coalition does
not manage to overcome, does not manage to pacify this country. A handle
of badly armed talibans put in failure the Western adventure. Why? There
are grounds for to reflect, the reasons do not fail to
include/understand the strategic reverse. There is probably bankruptcy
of the policy followed in this country. One does not pacify a country
with the weapons. What will it occur about it of this Western adventure?
The question remains posed, especially for the Occident.
While returning to a “confrontation”, is
the question serious? Everyone knows that a “third world war”
with the clean direction of the term, is prohibited with humanity. It is
not any more as in 1914-1918 or 1939-1945, where humanity lived a
martyrdom of several years of war. A “third world war” would be
played in one day “J”, one hour or a few hours “H” and
not of the days neither of the months nor of the years. In this short
time which would last one hour even a few hours, with the nuclear
arsenals available to both superpuissances + China, they are tens or
hundreds of cities, especially of the mégapoles, which will disappear
from the surface of the ground. What implies that hundreds of human
million being will disappear… in this day “J”. It will be quite
simply the apocalypse.
This is why
one cannot speak about “confrontation” on this scale, the human
being which we are cannot believe one moment that the human being goes
autodétruire. There remains however this possibility of “third world
war” but not in the apocalyptic direction but rather in the
economic direction. For that, it should be remembered that the First
World War and its during, the Second world war, originated in the
dissensions which existed in the Western camp on the seizure of the
colonies of Africa, of Asia, etc This camp was torn by the ambitions of
the ones and others, all aspired to extend, conquer, colonize
territories and people. It is this race towards the extension,
enrichment and the domination which generated the resentments, the
discord, hatred within the Occident and which finished by the war. Two
world wars followed, which weakened the Occident, put fine at rancours
internal and preached a “Union”, this one was achieved today.
Of course, it also allowed the people fixed to be raised of the yoke of
the domination and to reach independence.
4. A “third world
war”
Six decades
spent since the second world war, Asia emerges in large pole economic
and financial. Today India and especially China occupy the front of the
world economic scene. On its side, since the fall of the “Berlin
Wall” and its widening with the Eastern European countries, Europe
seeks to recover a statute of World power. Thus, restive with the
American monetary domination, she seeks, while launching the euro, the
single currency, to release itself from the American monetary
supervision. But by doing this, it opens the Pandora's box.
A true economic, financial and monetary
war, opposes, in an insidious way, since 1999 holding them of the world
order. This world order admittedly is in change. Will the question which
arises, how leave this new world order? Under which face, difficult to
envisage. A thing is certain, this “insidious war” can be
comparable with a “third world war”, a world war of a new kind.
One did not assimilate the “cold war” like a “third world
war” or the “war against terrorism” in 2001 like the
“fourth world war”.
When
Francis Fukuyama, of the American State Department, left the myth of the
“end of the ideologies” with the fall of the “Berlin
Wall”, preached in 1989 another concept, “the end of the
History”, there is, in truth, a share of truth in any formulated
concept, except that what is known as can apply to another thing that
what one believes to say. What one can include/understand in this new
dynamism of the world, it is that the Western civilization which
dominated a long time, is being supplanted not by another civilization,
but by precisely a new dynamism made of all civilizations, and dominated
by new geoeconomic visions. The world became total, the Occident east
not compels to yield but contribute for its own good being to the new
historical laws. It has other choices only to transcend its fear of the
other, to open, because nobody today can live in fold, so much the risks
are strong to lose his reference marks.
It is precisely with these problems in the horizon
of these extreme questions that the analysis should be carried, to seek
the direction of the evolution of the world at this beginning of third
millennium. If not how to include/understand what will be, if the world
does nothing but follow the risks of its impulses, of its history,
without seeking to include/understand this history, its
history.
Hamed MEDJDOUB
March 31, 2008
Bond:
www.medjdoub.com