Why go to Las Vegas, lose a lot more on the markets.

Baron Alexandre Lamfalussy, who died on 9 May, is described as the ' Father of Euro '. He was deeply sceptical of the viability of a monetary union of disparate economies without fiscal and political union. " The prerequisite to a successful pooling of reserves is the effective co-ordination of economic policies," he wrote. What he meant was that a single currency with a single interest rate across 19 countries is not likely to succeed if national governments are free set their own spending targets and tax rates. Government policies depend on the political party in power. Conservatives believe tight government spending with low taxes lead to higher consumer demand which leads to greater investment, creating more jobs and increasing wealth. Socialists believe in greater government spending, financed by high taxes on the rich, leads to more cash in the hands of the poor which leads to greater consumer spending, thus leading to greater investment and growth. A common currency meant that Greece was able to go on a spending spree, fueled by low interest rates and cheap imports, while Germany ran surplus budgets because a single currency kept its exports relatively cheap. The bond buying program by the European Central Bank has helped Germany but not Greece. Purchase of German bonds increased their price to such levels that yields dropped to negative so that the government was being paid by investors for borrowing money. As the Euro fell the dollar rose. This meant that countries which depended on exports of commodities saw a fall in prices, and hence earnings, while exporting countries like Japan benefited by being able to buy oil cheaply while a weaker yen made their goods cheaper, increasing sales. India benefited from a cheaper oil but  companies which have borrowed overseas will have to repay more in rupees causing financial stress. It could not last and it didn't. There was a sudden sell off in bonds across the world. Yields on German bunds rose by as much as 0.5%, commodity prices rose and the Euro rose against the dollar. Those who were borrowing in Euros at zero interest rate to invest in other currencies, where interest rates are higher, secure in the knowledge that they would not only earn more from arbitrage but also from further weakening of the Euro, suffered heavy losses. Meanwhile, in the US the purchase of treasuries by the Federal Reserve has left a $900 billion shortage of bonds. Greater demand for bonds suppresses yields and if the Fed starts large scale sale of bonds it will reduce liquidity and cause a rise in interest rate when economic figures are still weak. Wall Street is naturally puzzled as to what to do. Globalisation has shifted power to markets. Central banks are terrified of brokers. There can be only one outcome of this high stakes gambling - a collective meltdown.