Letter of Credit Forum

The Economist reminded its readers that 50 years ago Eurobonds were created.

As befits the topic of international finance, the first Eurobond was complex and cross border in an elaborate attempt to avoid taxes. An Italian company, which could pay interest without deducting italian tax, issued its bonds
in Schiphol airport/Amsterdan to avoid British stamp duty with coupons payable in
Luxembourg to avoid British income tax.

This scheme reeks of the shenanigans that politicians and the publid have tired of. However, as the Economist titles it little stroll down memory lane "Money will find a way".

Liquidity will follow the path of least resistance and the Euro savers might discover that they saved the Euro and destroyed European finance through a maze of regulations intent on saving banks and investors from themselves. It seems that creeks of liquidity already pour into Asia, not only financial centres like HongKong and Singapore, but also the mainland where a strengthening Yuan offers comfortable returns and an economy that grows 3 to 5 times as fast as their Western competitors.

Politicians like generals fight the last war; that is however not always good enough to stem the tide of cash going out to less rocky shores.