Tuesday, August 9, 2011

Why are the currencies of Iraq, Iran, Cuba, and Syria all fixed to the U.S. dollar?

several reasons 1) stability of the currency (i.e. the US$ used to be a very stable currency), 2) liquidity of the currency (US$ is extremenly liquid), 3) no other real competitive currencies (maybe the Euro now), 4) tarding and reserve (they parked their reserve in US$), 5) oil in the case of Iran and Iraq (although since they are becoming the51st state -or a colony to be exact- they don't really have a choice). Oil is being traded in US$ and they are getting paid in US$.

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