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Borrowing is going to become much less predictable as well as more expensive. The proposed and expected tapering is already causing countries to suffer depreciation of their currencies because rates in the US have risen causing other currencies to fall. That has lead to nations, especially in the BRIC countries, to sell Treasuries to be able to free up reserves to buy in their own currencies to support them. They are caught in the bind of trying to avoid inflation which would result from falling currencies, yet needing to keep the their currencies low to stimulate exports on which their economies are so dependant. The result of all of this is there are a considerable number of countries dumping US treasuries at the same time the Fed is thinking of tapering. Result is higher rates in the US. There is a related issue which is a shortage of Treasuries to trade and hedge with. This causes disruptions in good pricing clarity and volatility, and so it makes hedging by lenders that much more problematic.

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