After reading the transcript of OBL's latest video, where he urges his supporters to attack the US financially, I've been reading about international capital flows, trying to get a handle on how much "hot money" is out there, and who it belongs to. Does anyone know how much money flows through hawala networks? Does anyone know how much money is in the black market?
We have, from time to time on this thread, discussed the US Treasury department's Exchange Stabilization Fund (ESF), mostly in the context of whether it is used to keep the price of gold artificially low. Interestingly (to me) the ESF was enacted in 1934 during the global banking crisis, which was causing instability in foreign exchange markets. Not sure whether it's a coincidence that the Great Depression (sorry, DJ, can't help it!) bottomed out in 1934, IOW whether the ESF helped improve liquidity and get the money flowing again.
At any rate, I've learned that some of the nastiness of the GD was triggered by France attacking Austria and Germany's currency deliberately (for political reasons), which led to the revelation that Austria's CreditAnstalt was bankrupt, and caused a chain reaction of bank failures all over the world. And of course we see similar events from time to time, usually brought on by private traders like Soros making runs against indefensible currency pegs in smaller, less developed countries.
How much damage could OBL's supporters actually do to, say, the US dollar? |
