Can someone help me out here? I’m getting a tad confused.
Hollande tells us that euro clearing will have to move inside the eurozone. Well, OK, shrug.
What I’m not quite getting is the dollar clearing system. I can see that there’s London dollar clearing, Hong Kong dollar clearing and so on. But then I get the impression that that’s not really, really, dollar clearing outside the US. Everything still goes through the US system at some point (normally New York) which is how those banks were busted for breaching sanctions.
The impression I get is that this local dollar clearing is more like being agents for New York than it is a full and total clearing system. Is that right? Or perhaps local agglomeration and netting of transactions which then the balance clears through New York?
The question becomes, of course, what actually happens if the euro must be cleared in the eurozone. Do we end up as with the dollar? Local, London, clearing which is then backstopped by shunting a few electrons off to Calais?