More on Citi and Bank Nationalization

226980 Resource 119247 120646 120646 1235403774982 1235683699936 Controlled Will Citi Be Nationalized? And What Will It Do to the U.S. Dollar in Forex Trading?

FX360 takes a look at what bank nationalization means to the U.S. dollar

Today, all the financial news is about thing: <a href="http://www.stockmarketfunding.com/SMF-Blogs/Economic-Analysis/February-2009/C-U-S--eyes-large-stake-in-Citi.aspx" target="_blank" title="bank nationalization, Citi, Bank of America, U.S. dollar, forex trading, dollar forex trading, FX360, Kathy Lien, Boris Schlossberg">Bank nationalization</a>. Speculation is running rampant that Citi and Bank of American may both be nationalized. And<a href="http://www.fx360.com/?aid=5704" target="_blank" title="bank nationalization, Citi, Bank of America, U.S. dollar, forex trading, dollar forex trading, FX360, Kathy Lien, Boris Schlossberg"> FX360</a> is right there with some analysis of the situation. Kathy Lien points out that <a href="http://www.fx360.com/commentary/kathy/706/us-dollar-impact-of-bank-nationalization.aspx?aid=5704" target="_blank" title="bank nationalization, Citi, Bank of America, U.S. dollar, forex trading, dollar forex trading, FX360, Kathy Lien, Boris Schlossberg">the main emotion felt right now is fear</a>: <blockquote> The rally in <span onmouseover="if(window.parent && window.parent.Xinha){return false}clearTimeout(tmout); ShowPopup(this,'https://gftnet.gftforex.com/uploads/gbpusd091508.gif','.GOLD','GOLD');" onmouseout="if(window.parent && window.parent.Xinha){return false}tmout = setTimeout("HidePopup()",1000);" style="color: #004276; cursor: pointer; text-decoration: none;">gold <img border="0" src="http://www.fx360.com/App_Common/images/chart-icon.gif" /> prices tells us one thing and one thing only, which is that the fear has returned to the market.  There is currently a lot of speculation that Citigroup and Bank of America could be nationalized by the US government.  Although this would drive equities lower, it could also trigger capital flight out of the US dollar.  </blockquote> There is concern that the value of the U.S. dollar won't be able to hold in a world where the government is further encumbered by bad assets -- this on top of the crazy amounts of debt being racked up. But that fear may be unfounded. While the U.S. dollar would retreat in forex trading for the short-term, Boris Schlossberg points out that<a href="http://www.fx360.com/commentary/boris/697/dollar-wobbles-as-nationalization-of-citi-looms.aspx?aid=5704" target="_blank" title="bank nationalization, Citi, Bank of America, U.S. dollar, forex trading, dollar forex trading, FX360, Kathy Lien, Boris Schlossberg"> Citi could turn out a valuable asset for the U.S. government</a>: <blockquote> The initial reaction to nationalization may continue to prove dollar negative, but we find the argument of dollar bear dubious at best.  Under nationalization Citi equity and bondholders would be the ones to suffer the most, while the US taxpayer could in fact profit in the long run if the US government were to pick up all of Citi’s global infrastructure at pennies on the dollar and then recapitalize that asset ultimately creating value. </blockquote> What is clear, however, is that the U.S. dollar is retreating right now in forex trading. Perception is everything, and many Americans recoil at the idea of bank nationalization. And for good reason. Look what happened to the U.K. pound after the British government nationalized Northern Rock. But, on the other hand, the sterling is on the rebound (finally). Although Northern Rock probably has little to do with the pound's newfound strength. At any rate, for now, it is quite likely that some <a href="item/226782" target="_blank" title="bank nationalization, Citi, Bank of America, U.S. dollar, forex trading, dollar forex trading, FX360, Kathy Lien, Boris Schlossberg">dollar weakness is ahead in currency trading</a>. 9 application/xml false bank nationalization Bank of America Boris Schlossberg Citi currency trading dollar forex trading forex trading FX360 Kathy Lien U.S. dollar More on Citi and Bank Nationalization Will Citi be nationalized? http://www.thestreet.com/story/10465476/1/todays-outrage-citis-worthless-offer.html?puc=_tscrss U.S. Dollar in Forex Trading Currency trading on the FX market http://www.fx360.com/?aid=5704 Mozilla/5.0 (Macintosh; U; Intel Mac OS X 10.5; en-US; rv:1.9.0.6) Gecko/2009011912 Firefox/3.0.6 127.0.0.1 127.0.0.1 mmarquit 66.182.66.2 false true false false true 119247 blog blogsite/GFTForex/web