So, I’m having a hard time buying the idea that any lockdown needed to happen because of a virus that is unlikely to kill more than one person in every 100,000 on this planet. I’m having such a hard time, in fact, that I’ve tried to come up with some kind of alternative explanation that suits the facts…an explanation that actually makes logical sense. Allow me to posit this:
Putin met with MBS (Saudi leader) the first week in March. At that point, the coronavirus was just underway in Asia but nowhere else, really. They discussed oil production cuts. Putin refused, the Saudis threw their production wide open, and now oil prices are in negative territory for the first time in history.
That’s the narrative. And, it may be right. But nobody knows what conversations really took place behind closed doors, and it doesn’t really make any logical sense. Why would these two oil giants destroy their own industries? Could it be possible that something else actually happened that could better explain the facts as we know them?
What about this as a possibility? Russia has been cozying up to the Saudis for years, and the Saudis like to keep their options open with both Russia and the USA. They buy military hardware from the USA but cooperate with Russia as an OPEC partner. Lately, the USA has irritated MBS by allowing lawsuits against the kingdom over 9/11. We have also failed to fully back them in their war against Yemen and haven’t been as bellicose as they would like against Syria and Iran.
With that in mind, what if, during the early March meeting, the Russians and the Saudis actually talked about decoupling the price of oil from the USD, instead of production cuts, as the media explained? What if that got back to the USA through their spy network? What if that conversation so frightened the US that they took drastic measures to make sure it never happened again? After all, the dollar as world’s reserve currency is buttressed largely via the fact that oil contracts must be settled in $.
Could the US, in fear, have deliberately locked down the entire world’s economies just to starve these two oil producing giants into submission? IOW, play hardball with them so that they never wanted to try to walk away from the USD again? Remember, the stakes are very high: if the dollar loses its status, the economy of the USA instantly becomes third world, not just in theory but in fact. Suddenly, the MIC is crippled and prices skyrocket as hyperinflation kicks in. So, there’s plenty of motive for this “crime”.
How could they bring the Saudis and Russians to heel? By creating an oil glut of historic proportions that now threatens to cripple their respective economies. Remember, while it is true that the rest of the world is suffering economically, it is even more true that SA and, to a lesser but still overwhelming extent, Russia, are both almost entirely reliant on oil to bolster their economies. With oil trading in negative numbers today, I’m sure they will both be howling soon. Could that “punishment” be lifted by the USA behind closed doors by lifting the lockdown here and thus bringing the demand side of oil back, so long as Russia and SA promise to toe the line on the USD?
Think about the way this happened. The USA was one of the last northern hemisphere countries to lock down. That plays into the fact that maybe we thought we could dodge the bullet of the lockdown altogether while the rest of the world’s slowdown crippled our adversaries. When that didn’t happen, we had to shut down for the sake of appearances, but for the elites the suffering in the lives of the petty proles who suffer from the lockdown would be, in the immortal words of Madeleine Albright, “worth it”.
We have the influence to make this happen. While the WHO has publicly been at odds with the USA, they do get most of their money from us, so it’s not inconceivable that behind the scenes they would be doing our will. The EU is our lapdog, in effect, and will do our bidding as well. In much of the developed world, they rely on USD to prop up their corrupt dictatorships. It would be child’s play to convince them to shut down their economies if the US diplomat suggested it, especially when the rest of the world had already done so. And, of course the media would need to comply, but they are famously Rusophobic, in large part because of the fact that they are owned by Jews, who have a historic animus towards the slavic peoples.
So what I’m suggesting as a working hypothesis is that the United States deliberately shut down the world’s economy in order to keep the dollar standard era going. I think we will see the validity of that theory as things develop in the months to come.
Quite plausible, and an analysis that is refreshingly interesting. Therefore, (according to Madeline Albright) your perspective is “worth it” to consider.
Let’s stay tuned.
Thanks Becky! Good to hear from one of my loyal readers. :))
Thoroughly enjoyed your prose, though I think that the importance that oil is negotiated and paid for in USDs is overblown. In a world of historically low interest rates, the value to an economy of having a reserve currency is not all that large. The USD’s status as the dominant reserve currency has been gradually falling over the past few decades (its down to about 60% now) and that will continue to fall. As well, the US is now a net oil exporter for the first time since the 1940s – so if the US were to drive down the price of oil it would appear more look shooting yourself in the foot.
John, my old friend from Down Under! Thanks for reading. I wish we could talk face-to-face, but since this is the best we can do, here would be my rebuttal:
I think the value to the economy of a world reserve currency is enormous. Every item the US imports is paid for in USD, which need no conversion because the trading nation has dollar deposits as part of their own reserves. Isn’t that right? Also, as a bludgeon to use in foreign policy it comes in handy if you are able to “freeze out” a country like Iran from the world’s economy if 60% of that world trade is conducted in USD. Am I wrong?
I admit that the US shale oil industry is a weak link in the theory. I could only suggest that Trump thought the USA might not have to shut down our own economy as part of this lockdown and, even if we did, he could bail out our own industries. In fact, just from looking at the business loan dispersals across the nation, most of the bailout $ seem to be going to the oil patch right now…an indicator that this might be what’s happening.
But let’s face it: I have no proof at all that this is what’s happening. All I know for sure is, there’s more at work here behind the scenes than this fairly innocuous Chinese flu.