MOST of the speculative money that flooded into West Germany last week came from a volatile and increasingly powerful segment of the world's financial apparatus: the Eurodollar market. That market is a curious byproduct of two decades of U.S. balance of payments deficits. Eurodollars are nothing more than U.S. dollars on deposit in private banks abroad. The pool was organized in the late 1950s by London bankers who sensed that if they could marshal the billions of dollars already overseas, they could lend them out at a substantial profit. Business has been brisk ever since.
Today the Eurodollar market has expanded into...
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