Dollar Rises On US Rescue Plan

The dollar is firmer across the board in early trade Friday on the news that the US Treasury & Fed are to come the aid of the world financial markets with a comprehensive rescue package.

Our heroes, U.S. Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke, (be still my beating heart) are giving up their weekend to "sort the job out."

Paulson said that he was planning to paint the fence, but that he could spare a couple of hours. Bernanke said that as Mrs Bernanke was out of town he could pretty much do whatever he wanted and that his planned trip to the Hot Chicks Ranch, Nevada, would have to wait.

Excatly what the weekends plan might include we will have to wait & see.

Some think it may include a kind of slush fund to buy distressed assets from banks. Maybe they might like to extend that to buying distressed purchase books from compounders? That would be interesting.

"I've got Ben Bernanke on line one, he wants to make some fixings on tapioca...Henry Paulson line three, his lorry can't pick those soya hulls up and he wants to defer them to 2012."

Anyway, investors seem to like the idea because they're buying dollars this morning. At 9am London time the pound was a fraction under the 1.80 mark at $1.7988, around 2 cents below its earlier high.