The euro quickly became a major international currency: the euro bond market soon came to rival the dollar bond market; euro bank notes began circulating around the world.

As Banks became more and more averse to lending, the supply of dollars available to the currency market shrank, and the dollar gained against other currencies such as the 15-nation euro.

Scared investors rushed into the safest dollar assets, lured by the liquidity of the vast market for us Treasuries, as the euro area was revealed as a mess of fragmented bond markets.