the volume of FX Swaps that are missing from any given non-bank financial institutions' balance sheet outside the us, OR the sheer growth of the collated business loan depts worldwide where they pay off bad loans with bad loans that they all took out for buybacks.
non-bank financial institution outside US (hedgies, asset mgr etc) swap their currency for desired asset's native currency (FX Swap)
as long as above-mentioned don't sell (close transaction), they're not obligated to record the FX Swap on their balance sheet.
collated estimation of 80 trillion dollars worth of these FX Swaps are not on these non-banks' balance sheets
80 trillion dollars are effectively missing
The money is sitting in the constantly devaluing asset that they swapped their currency for. They just don't have to record the swap on their balance sheet until they sell the asset. But it'll be too late, as the asset will be worth a fraction of what they paid for it.
The real problem here is that the value of these unrecorded FX swaps (80 trillion) is double the amount of USD Market cap (40.419 trillion)
>https://www.ceicdata.com/en/indicator/united-states/market-capitalization
My question is what will this cause to the dollar
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