This Is How Corporate Bankruptcy Begins

And it probably won't be much different for a corporate state such as Amerika.

OPEC Sells the Dollar
Friday, January 26, 2007

The nations of the Organization of Petroleum Exporting Countries are selling U.S. Treasuries at the quickest pace in more than three years, according to U.S. Treasury Department data. Concerned analysts predict a dollar sell-off coupled with rising interest rates.

In the three months ending in November 2006, oil-exporting nations including Indonesia, Saudi Arabia and Venezuela sold 9.4 percent of their U.S. government debt—a significant amount, considering these countries own more than $100 billion worth.

Over the past few years, oil producers have become very important dollar supporters, rivaling the United Kingdom, and even China and Japan.

Since most oil is sold in dollars, rising oil prices meant that opec countries’ dollar reserves ballooned. In fact, during 2006 alone, oil producers amassed a whopping $500 million in dollar-denominated savings. Fortunately for Americans, the dollar’s historic role as a stable store of wealth influenced many of the world’s oil exporters to either save those dollars or recycle them into U.S. Treasuries.

However, some economists worry that mounting dollar sales and slowing Treasury purchases indicate the dollar is losing its reputation as a stable reserve currency.

“The dollar has been subjected to a great amount of exchange-rate volatility, and it’s not a good store of value anymore,” said Joseph Stiglitz, a Nobel laureate and economics professor at Columbia University in New York. “There will be a significant sell-off.”

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