Wednesday, March 4, 2009

One theory on why the Dollar has remained resilliant.

Europe’s banks face a $2 trillion dollar shortage

The BIS said European and British banks have relied on an “unstable” source of funding, borrowing in their local currencies to finance “long positions in US dollars”. Much of this has to be rolled over in short-term debt markets. The currency mismatch has become a potential risk for banks as the dollar continues to climb against the euro and Swiss franc, and especially sterling and Sweden’s krona.

Posted by flintster1994 @ 09:27 PM (931 views)
Please complete the required fields.



6 thoughts on “One theory on why the Dollar has remained resilliant.

  • stillthinking says:

    So the British banks do have liabilities in dollars. The devaluation route looks a bit closed in that case.

    Reply
    Please complete the required fields.



  • inflation is eating my savings says:

    BIS is a Rothschild op. These guys have a history of market manipulation. Are they trying to shift some dollars?

    Reply
    Please complete the required fields.



  • Mortgage Analyst says:

    I don’t get it. I borrow in Sterling to buy Dollars. Sterling goes down and Dollars go up. My liability is worth less and my asset is worth more. My net position has increased in value. What’s the problem again?

    Reply
    Please complete the required fields.



  • from Eastern Europe goes bust ~~~ another $2trillion or the same one.

    “Latvia the Next Iceland?

    The situation has reached such a crisis point in Latvia that anyone that reports on the truth is being arrested by the Latvian security forces as an omen that economic turmoil means a return towards tyranny as I wrote of in early December 08 – (Latvia Protects its Banking System by Arresting Economist For Speaking the Truth),as the Latvian secret police arrested Dmitrijs Smirnovs, a university professor for delivering gloomy forecasts on the prospects for the Latvian economy and the state of the Latvian banking system.”

    Reply
    Please complete the required fields.



  • Fingerbob69 says:

    I believe in this country we opporate a system called ‘Newspeak’!

    Reply
    Please complete the required fields.



  • This is what I understood the problem with the UK was. in that UK banks had massive foreign currency liabilities and no foreign currency reserves. As Sterling devalues these foreign liabilities keep on increasing, I think the UK has the same problem as many South American countries such as Argentina.

    Reply
    Please complete the required fields.



Add a comment

  • Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
  • Please note that any viewpoints published here as comments are user´s views and not the views of HousePriceCrash.co.uk.
  • Please adhere to the Guidelines

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>