Iran: Gold to Replace the Dollar for Oil Sales

by Apr 25, 2012Foreign Policy0 comments

And it's not going to be very pleasant when the U.S. dollar fails and the global experiment with fiat currency ends as the Bretton Woods financial system collapses.

Wow.

Beijing is planning to avoid U.S. financial sanctions on Iran by paying for oil with gold.  China’s imports of the metal are already large, and you can guess what additional purchases are going to do to prices.

On the last day of 2011, President Obama signed the National Defense Authorization Act for Fiscal Year 2012.  The NDAA, as it is called, attempts to reduce Iran’s revenue from the sale of petroleum by imposing sanctions on foreign financial institutions conducting transactions with Iranian financial institutions in connection with those sales.  This provision, which essentially cuts off sanctioned institutions from the U.S. financial system, takes effect on June 28.

The NDAA gives the president the power to waive the sanctions depending on the availability and price of supplies from non-Iranian sources.  He can also exempt financial institutions from countries that have significantly cut back purchases of Iranian petroleum.  Last month, the State Department announced waivers for Japan and ten European countries.  China, which has received American waivers in the past under other Iran legislation, is now Tehran’s largest oil customer and investor as well as its largest trading partner.  Given the new mood in Washington, Beijing cannot count on getting more exceptions in the future….

As the Wall Street Journal noted in early January, the sanctions are “an attempt to force other countries to choose between buying oil from Iran or being blocked from any dealings with the U.S. economy.”

This reminds me of the Book of Revelation:

The whole earth was amazed and followed the beast. They worshiped the dragon because he gave authority to the beast. And they worshiped the beast, saying, “Who is like the beast? Who is able to wage war against him?” A mouth was given to him to speak boasts and blasphemies…. And he was permitted to wage war against the saints and to conquer them. He was also given authority over every tribe, people, language, and nation…. Then I saw another beast coming out of the earth…. He exercises all the authority of the first beast on his behalf and compels the earth and those who live on it to worship the first beast… And he requires everyone–small and great, rich and poor, free and slave–to be given a mark on his right hand or on his forehead, so that no one can buy or sell unless he has the mark: the beast’s name or the number of his name.

The Forbes article continues:

China has already been trading its produce for Iran’s petroleum, but there is only so much gai lan and bok choy the Iranians can eat.  That’s why Iran is also accepting, among other goods, Chinese washing machines, refrigerators, toys, clothes, cosmetics, and toiletries.

The barter trade works, but Iran needs cash too.  As it is being cut off from the global financial system, the next best thing is gold.  So we should not be surprised that in late February the Iranian central bank said it would accept that metal as payment for oil.

It doesn’t end so well for the beast:

Then I saw the beast, the kings of the earth, and their armies gathered together to wage war against the rider on the horse and against His army. But the beast was taken prisoner, and along with him the false prophet, who had performed the signes in his presence. He decieved those who accepted the mark of the beast and those who worshiped his image with these signs. Both of them were thrown alive into the lake of fire that burns with sulfur.

Ooh, that doesn’t sound very pleasant. And it’s not going to be very pleasant when the U.S. dollar fails and the global experiment with fiat currency ends as the Bretton Woods financial system collapses.

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About Jeremy R. Hammond

About Jeremy R. Hammond

I am an independent journalist, political analyst, publisher and editor of Foreign Policy Journal, book author, and writing coach.

My writings empower readers with the knowledge they need to see through state propaganda intended to manufacture their consent for criminal government policies.

By recognizing when we are being lied to and why, we can fight effectively for liberty, peace, and justice, in order to create a better world for ourselves, our children, and future generations of humanity.

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