BIS report on dollar shortage in global banking

[Joanne98]

The US dollar shortage in global banking

The current financial crisis has highlighted just how little is known about the structure of banks’ international balance sheets and their interconnectedness. During the crisis, many banks reportedly faced severe US dollar funding shortages, prompting central banks around the world to adopt unprecedented policy measures to supply them with funds. How could a US dollar shortage develop so quickly after dollar liquidity had been viewed as plentiful? Which banking systems were most affected? And how have funding pressures affected lending to non-bank end users of funds?



http://www.bis.org/publ/qtrpdf/r_qt0903f.pdf

[Uben]

1. I can help out

I have a few thousand dollars in my safe that I will let go of. An offer of $1.25 for each dollar seems reasonable by todays banks standards, so I will accept any offer above that. I know it seems high, but once you add on the fees, interest, and handling charges, banks should understand why I'm asking this amount!



/sarcasm

[Joanne98]

2. Good one.

[leveymg]

3. You should start a bank. You'd probably qualify under current American standards

Don't forget to buy a trillion dollars worth of credit default swaps -- might cost you forty or fifty bucks, good deal! -- and count them as assets. Then, go and swap them for real estate foreclosure warrants. You're ready to open branches in Switzerland and the Caymans. Gotta spring for a Gulfstream V to fly back and forth in the style that you deserve, of course, and then you'll need a nice villa in both places with a secure perimeter. Buy something with a city wall attached. Now you're a banker!

[Po_d Mainiac]

4. You didn't really mean that did u?

Don't want to rephrase and state that you would "lend" the banks the money if they put 125% up front in Swiss Francs, with a 25%/per day teaser rate; that would adjust upwards in proportion to the decline in the borrowing bank's stock, upticks in the TED, surge in the value of the CAD (Canadian Loony) or any other indicator that (economically speaking) we've screwed the pooch to the point she is no longer capable of carrying a litter?
:sarcasm: