The Swiss hiss

Another global dollar flood! The Swiss National Bank joined with those of the UK, USA, Eurozone and Japan to provide unlimited dollar liquidity for banks in a move reminiscent of the big dollar swap lines that were made available post-Lehmans. It's mostly for Euro banks of course where liquidity concerns have ticked up inexorably in recent weeks. It's not too hard to arrive at the conclusion that many Euro banks are effectively bust on the basis of their increasingly delinquent exposure to the peripheral Eurozone sovereigns. I hate now to be one of the internet economist brigade spelling out doom for the global economy but I have to admit that the policy paralysis is a serious threat. Banks could become seriously unglued. Pumping dollars into the system is merely a stopgap and does not confront the main problem - restructuring of Eurozone debt is now inevitable. In the meantime the Swiss National Bank is aggressively opposing the flow of funds into the country seeking safe haven. The line on Swissy is drawn in the sand but it's tough game to win. The QSL is from from the International Committee of the Red Cross trial in 1968 heard on shortwave in Cape Town in 1968.