money_spiralOvershadowed by other stories in the news cycle this week was chaos in the global currency markets as a result of the Swiss National Bank’s decision to remove the currency ceiling on the price of the Swiss franc. While resulting in a 30 percent surge in the value of the Swiss franc against the euro, the move has caused massive losses in currency trading markets worldwide, with disastrous consequences for institutional and retail currency traders shorting the Swiss Franc on bets the Swiss franc was overvalued and scheduled for a price reduction. The magnitude of the crisis for U.S. currency traders became clear Friday when New York-based FXCM, a publicly traded U.S. currency broker, and the largest so far to announce it was in financial trouble after suffering a 90-percent drop in the firm’s stock price, reported the firm would need a $200-$300 million bailout to prevent capital requirements from being breached. Highly leveraged currency traders, including retail customers, were unable to come up with sufficient capital to cover the losses suffered in their currency trading accounts when the Swiss franc surged. More