Tuesday, April 25, 2006

The threat to a fistful of petrodollars

Yep, this is the major threat to the oil men in the W.H. and a few in congress

The threat to a fistful of petrodollars:

"04/23/06 'The Telegraph' -- -- From Russia, you might say, with love. This weekend, Alexei Kudrin, Russia's finance minister, dropped a bombshell in Washington.

Attending the annual meetings of the World Bank and International Monetary Fund, Kudrin caused his American hosts discomfort by openly questioning the dollar's pre-eminence as the world's 'absolute' reserve currency.

The greenback's recent volatility and the yawning US trade deficit, 'are definitely causing concern with regard to its reserve currency status,' he said. 'The international community can hardly be satisfied with this instability.'

Kudrin's intervention coincided with another meeting, also in Washington, of finance ministers and central bankers from the Group of Seven - which doesn't include Russia.

Top of the agenda: the effect of ever-rising oil prices on inflation and interest rates.

G7 countries are worried the spiraling price of crude - which closed at $72.79 a barrel on Friday and which has now trebled in three years - could inflict real economic damage. The US Federal Reserve, in particular, has been forced to take drastic action - raising interest rates 15 times since June 2004 to keep inflation in check."

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