> I still might be a little fuzzy on why sterilization is necessary and how
> it functions. Doug explained afterwards that this huge influx of money
> causes inflation, and has to be "soaked up" by the issuance of bonds
> denominated in the local currency.
Me too. This may be a stupid question, but where is the money that the Brazilian government got in return for those short-term bonds? Why isn't it available to repay those bonds that can't be rolled over? -- Enrique Diaz-Alvarez Office # (607) 255 5034 Electrical Engineering Home # (607) 758 8962 112 Phillips Hall Fax # (607) 255 4565 Cornell University mailto:enrique at ee.cornell.edu Ithaca, NY 14853 http://peta.ee.cornell.edu/~enrique