At root of the petrodollar error, that there is a petrodollar, is the very idea that governments monopolize money. You hear the claim repeated incessantly, a power, perhaps the power that authorities took on and will never, ever relinquish. Therefore, when Bretton Woods supposedly broke down in August 1971, it was for the government to overcome its deficiencies and move forward.
It’s understandable why some would incorrectly claim the US had transitioned from a gold-backed government currency to one tied to crude oil; the petrodollar. That the latter would also lead to foreign ownership of US federal government debt makes the theory that much sexier, perhaps more plausible than your typically conspiracy.
Read Full Article »