Details of the latest “dinners of ideas” in New York were recently unveiled. At these dinners the leaders of the world’s largest hedge funds, in particular the Soros Fund Management (US $27 bn) and SAC Capital Advisors (US $14 bn), are agreeing to mutual speculative activities at these dinners.
As soon as it became known that the fate of the euro was being discussed at the dinner table in February, the number of bull positions that currency speculators opened on fluctuations of the euro reached a historical maximum over the period of the European currency has been in circulation. Starting last week, the traders Goldman Sachs, Bank of America Merrill Lynch and Barclays began offering their clients instruments to play against the euro, which will bring US $1 mn in earnings to those prepared to risk US $70,000 today should the rate of the euro fall to US $1 over the course of this year.
The leading international financial speculators in New York basically wagered that this year the euro and dollar exchange rate will return to the 1:1 ratio as it was in 2000 just like in the sweepstakes,” says analyst of the Interfon investment fund Viktoria Kernesh.
“Speculators today assess the probability of the euro rate falling to the level of the dollar at 14:1 compared to the 33:1 ratio in January. Hedge funds need at least US $1.2 trillion for the euro to collapse. Their aggregate assets of US $1.5 trillion are sufficient to cover this amount, but that would also require the joint and coordinated actions of all speculators, which is most likely unattainable. If that happens, the rate of the euro will quickly recover. Otherwise, there is no sense in speculating. Be that as it may, for the average investor the game of market titans against the euro offers a good opportunity to buy euros.