Imagine for a moment that a group of New York hedge funds held private discussions about the beleaguered greenback, deciding that its roughly 40 per cent slide versus the euro in the past decade was excessive given America's relative economic merits. The news leaks, including the fact that a representative of currency trader extraordinaire George Soros was present. One would expect news coverage to be positive and small investors to mimic the trade. Government reaction, if any, might commend these masters of the universe on their patriotism.

Such a meeting actually took place, but the attendees now find themselves under investigation by the US Department of Justice and condemned by enraged European politicians. The spark that led to the charges appears to have been a February 26 newpaper article titled “Hedge funds are ganging up on weaker euro.” Letters requesting retention of trading records were sent the same day.

The investigation and outrage are absurd. Unlike shorting a stock, any bet that a currency will fall is a wager that another one will rise by the same amount. But in the rush to blame the problems in Greece and other peripheral European nations built up by their own leaders over years, hedge funds are a convenient bogeyman, as are banks acting as enablers like Goldman Sachs.