The Dollar and the Iraq War
Reader Amy Quinn over at CurrencyTrading.net brought an article to my attention that suggested twenty ways the war in Iraq has affected the U.S. dollar either positively or negatively.
One point that I want to bring up here is the potential for countries and organizations to switch to the euro. The article mentions that Syria started using the euro in 2006 to avoid funds being frozen in the U.S. Other countries could follow suit, and the result would be an even weaker dollar.
And if you think gasoline prices are bad now, just wait until OPEC decides to use the euro instead of the dollar. This move will further weaken the dollar.
For even more points, please check out the article, which I think provides an objective view on how the war in Iraq (and GWOT) are affecting the dollar.
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You should try buying petrol in Britain, £1.10 a litre for the good stuff.
We have mixed feelings about the Euro over here. Britain has a hard time with image and culture and adopting the Euro is often seen as a sign that we are giving up what it means to be British. And of course the pound is strong than the Euro anyway.
Andrew,
The pound being stronger is a good thing, at least in my opinion. With such a weak US dollar, it almost seems that we’re in a hole we can’t dig ourselves out of.
I can’t speak from experience, but I would hope the British culture didn’t depend on the currency alone.
I hope so too Ronald.
War plays such a huge role on every economy.
Yeah I can see why the Iraq war weakens the dollar and why these countries and organizations would consider switching to the Euro. Let’s hope it doesn’t happen
Miley Cyrus »
War and politics. I believe it’s mostly politics right now driving the dollar down.