HSBC is yet another bank that shows very well what is wrong with the global economy, because what is wrong is entirely about more than just the post-crisis era. We talk about a “dollar” shortage and there clearly is one, but the saga of HSBC demonstrates that this chronic shortage is just a symptom of the wider problem. The history of the bank’s balance sheet is one that is immediately recognizable in so many other forms:
The problem with HSBC today as author writes is a shortage of Eurodollar. In an indebted world and fractional banking system there is no scope for shrinkage of balancesheet.