Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Fake Dollar Bonds Touch A Raw Nerve

The (non) story of the week was the arrest of two Japanese "businessmen" in Italy with billions of dollars in old U.S. Treasury "bonds." These appear to be a fake. But the brouhaha surrounding them appear to a reflection of real issues, like doubts over the U.S. monetary system.

On its face, someone was trying to dump dollar denominated assets by selling dollar bonds, then converting the resulting dollars into some other currency. If the story had been real, this would have signalled a real lack of confidence in the U.S, dollar by some major (private) party.

In fact, major concerns regarding the dollar have been expressed by real nations. Foremost among them is China, which just hosted U.S. Treasury Secretary Tim Geithner. But even fiscally challenged Russia suggested that its ruble might be more stable than the U.S currency.

The bonds were a hoax. But the reason that it was a plausible hoax was because the underlying fears surrounding them were all too real.