Dollar credit: Looking over the Rubicon

The US government can’t seem to get away from the creeping nationalisation of its financial system. It’s a process that could end with a much weaker dollar. Tuesday’s $85bn of funding for insurer American International Group was the latest big slug of the Federal Reserve balance sheet to head to the private sector. Even before that, the central bank had swapped nearly half of the $800bn of government debt on its balance sheet for lower quality collateral from financial institutions. The Fed wo...