The three functions of money revisited
Posted by Ivo Cerckel on November 2nd, 2009
Saudi: dollar role ‘confused’ in oil pricing
Nov 01, 2009 at 18:18
http://business.maktoob.com/20090000391030/Saudi/Article.htm
SNIP
KUWAIT – Saudi Arabia’s top monetary official said denominating oil sales in dollars does not necessarily mean that payments from those sales are received in dollars or that investments would be done in dollars either.
“The pricing issue has no relationship with the payment issue and doesn’t have a relationship with the investment issue,” said Muhammad al-Jasser, Governor of the Saudi Arabian Monetary Agency, at a financial conference. “There is a big mixup between the three roles for any currency.”
UNSNIP
For SAMA ’s Governor Muhammad al-Jasser, the three roles of money are pricing, payment and investment.
In his 09 May 2002 Acceptance speech of the International Charlemagne Prize of Aachen, Germany, the late Dr. Willem F. Duisenberg, the European Central Bank’s first president, said money has three roles to fulfil; as a means of exchange, a unit of account and a store of value. (1)
Yes,
‘pricing’ is ‘unit of account’
‘payment’ is ‘means of exchange’
‘investment’ is ‘store of value’
Ivo Cerckel
honestmoney@maktoob.com
http://twitter.com/ivocerckel/
NOTE
(1)
International Charlemagne Prize of Aachen for 2002
Acceptance speech”
by Dr. Willem F. Duisenberg, President of the European Central Bank,
Aachen, 9 May 2002.
http://www.ecb.eu/press/key/date/2002/html/sp020509.en.html
No related posts.
November 2nd, 2009 at 13:09
The Gulf single currency may face delay,
but the Gulf monetary council is ‘on track’
and will be established in 2010,
says Mohammad Al Jasser, head of the Saudi Arabian Monetary Agency, the Saudi Central Bank
Gulf single currency may face delay: bank chief
(AFP) – 14 hours ago
http://www.google.com/hostednews/afp/article/ALeqM5j6Z28so_KDi4ZXzuUF3N44aihqVQ
Gulf monetary council ‘on track’
2009/11/01 17:47:11 GMT
http://news.bbc.co.uk/2/hi/business/8336866.stm
November 2nd, 2009 at 13:32
The nature of GMU
Who said Gulf Monetary Union was about a Gulf single currency?
GMU is only about marking the GMU’s gold reserves to market (marking to market – MTM) by the Gulf Monetary Council (GMC)
As oil is the only commodity that is large enough for gold to hide in, gold is hiding in there. Oil producers do exchange the petrodollar for gold.
CME to list new Saudi benchmark
01 November 2009
http://www.saudigazette.com.sa/index.cfm?method=home.regcon&contentID=2009110153202
SNIP
JEDDAH – The Chicago Mercantile Exchange (CME) Group – the world’s largest and most diverse derivatives marketplace – said that it was launching trading and clearing services for cash-settled swap futures on the Argus Sour Crude Index (ASCI), which is the new benchmark for Saudi oil.
The contract is scheduled to launch Nov. 23 on the NYMEX trading floor and will be cleared through CME Clearport.
November 2nd, 2009 at 18:54
This is today:
No signs of diversificationnaway from dollar: Jasser
Monday, 02 November 2009 – 15 Thul-Qedah 1430 H
http://www.saudigazette.com.sa/index.cfm?method=home.regcon&contentID=2009110253316
SMIP
KUWAIT CITY – The Governor of the Saudi Arabian Monetary Agency (SAMA) has said that there are no signs in the Kingdom of a move to “diversify assets away from the US dollar” and that he expects Saudi bank lending rates to continue rise. UNSNIP
But yesterday Governor Al-Jasser said that denominating oil sales in US dollars does not necessarily mean that payments from those sales are received in US dollars or that investments would be done in US dollars either.
Still, all of SAMA’s assets are denominated in US dollar?