Word: dollarization
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Dates: during 2000-2009
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...these countries are growing more robustly than the U.S., their interest rates are higher, thus creating a short-term opportunity for traders. Here's how it works with a currency like the Indonesian rupiah: the six-month London Interbank Offer Rate (or LIBOR, the benchmark for U.S. dollar borrowing), is now hovering at slightly less than 1%. That rock-bottom rate stands in stark contrast to the 6.5-7% rate of interest one can get from a short-term money market bill in Indonesia, where the 5-year government bond currently yields roughly 9%. The wide gap between the carrying...
...beleaguered U.S. dollar isn't getting much love these days, except from one small but powerful group: deep-pocketed institutional traders, who are piling into dollars with ever greater enthusiasm because it is so weak and cheap to borrow. "Dollar borrowing picked up steam after the G-20 summit {that ended in Pittsburgh on September 25} when traders concluded that interest rates in the U.S. were going to stay low for a long time," says Mark Matthews, chief Asia strategist for Fox-Pitt Kelton Securities. Adds Olivier Desbarres, a currency strategist for Asia with Credit Suisse: "Hedge funds, pension funds...
...trade in question is known as the "dollar carry trade" because it allows traders to borrow dollars at low rates while investing in another currency that offers a significantly higher short-term yield. One factor behind its growing popularity in Asia is because the other side of the trade - the currency one buys with the dollars one cheaply borrows - are mostly to be found in the Asia-Pacific region. Most coveted, according to traders, are the Australian dollar, the Indonesian rupiah, and even the infrequently circulated Sri Lankan rupee...
...state government, Kirwan is a veteran of steering large organizations through fiscal crises: as the state’s secretary of administration and finance under Mass. Governor Deval L. Patrick ’78 for the past two years, Kirwan has helped close a series of billion-dollar deficits...
...March 2008, University President Drew G. Faust traveled to Washington to lobby congress for an increase in funding for bio-medical research. She emphasized the need for a real-dollar increase in the total amount of NIH funding, which is the single largest funding source for Harvard projects. This year, Harvard researchers have secured 16 percent of the 2009 NIH grants...