The Long Arm of US Treasury

choi

The Long Arm of the Dollar; How to escape a hegemonic currency. Economist, May 17, 2018.
https://www.economist.com/financ ... g-arm-of-the-dollar

Note:
(a) "FEW banks can match the quaint serenity of Banco Delta Asia's headquarters in Macau. Housed in a pastel-yellow colonial building opposite a 16th-century church, its entrance is flanked by tall vases, depicting sampan gliding between karst hills. In the tiled square outside, men laze under a banyan tree and an elderly woman peels a boiled egg for lunch."
(i) Macao uses traditional Chinese characters.
(ii) For Banco Delta Asia (English: Delta Asia Bank; 滙業銀行), see Delta Asia Financial Group
https://en.wikipedia.org/wiki/Delta_Asia_Financial_Group
(was "founded in 1935 by AU Wing Ngok 區榮諤, father of Stanley AU  區宗傑, the current chairman and majority shareholder. It is the 10th largest bank in Macao [sic]")

carries a photo of its headquarters 滙業銀行行政中心.  I scour the Web but fail to find vases in the entrance. I assume its entrance means its lobby (whose photo I can not locate), for outer appearance (the Wikipedia,org shows a photo) displays no vase.
(ii) The headquarters is located at St Augustine Square (Portuguese: Largo de Santo Agostinho; Chinese: 崗頂前地 [崗頂 because it is atop a hill]).

Definitions of largo and santo are in (iii)(A).
(iii) Historic Centre of Macau  澳門歷史城區
https://en.wikipedia.org/wiki/Historic_Centre_of_Macau
(on the UNESCO World Heritage List in 2005)

Search in this Web page with "Augustine" and you will get four items:
* Dom Pedro V Theatre  伯多祿五世劇院  ("built in 1860 by local Portuguese to commemorate their reigning king, Peter V * * * Its current façade was added in 1873. * * * The theater is neo-classical in design": en.wikipedia.org; still in use)
* Sir Robert Ho Tung Library  何東圖書館  (public; houses head office of Macau library system; once owned by Dona Carolina Cunha 官也夫人)
* St Augustine's Church  聖奧斯定堂 (1586- : zh.wikipedia.org)
* St Augustine's Square  (photo: With Delta Asia Bank's headquarters in background, "tiled square" (en.wikipedia.org has a page for "Portuguese pavement") described in The Economist is in view.)
(A) Portuguese-English dictionary:
* largo (noun masculine; from Latin [adjective] largus [large]): "square"
https://en.wiktionary.org/wiki/largo
* The Italian, Portuguese and Spanish noun masculine santo, as well as English saint, is derived from Latin sānctus, passive participle of verb sanciō consecrate.
* dona (noun feminine; ultimately from Latin [noun feminine of dominus] domina): "lady (woman of breeding and authority)"
https://en.wiktionary.org/wiki/dona
(B) dominus (title)
https://en.wikipedia.org/wiki/Dominus_(title)
(an official title of the Roman Emperors; section 2 Usage: Portuguese: Dom/Dona; Spanish: Don/Doña; Italian: Don/Donna; French: Dame & Madame)
(C) The male given name (English: Peter; Portuguese/Spanish: Pedro) came from Latin Petrus, and from Ancient Greek Pétros (Ancient Greek noun pétros stone, rock).
(D) The Portuguese surname Cunha is from "one of the numerous places called Cunha." Dictionary of American Family Name, by Oxford Univ Press.
(E) Order of Saint Augustine "is a Catholic religious order. Although more ancient, it was formally created in the thirteenth century [1244, per Order's website, which says it is [based upon the teaching of the Bishop of Hippo']] and combined several previous Augustinian eremetical orders into one." en.wikipedia.org

* Augustine of Hippo
https://en.wikipedia.org/wiki/Augustine_of_Hippo
(354 – 430; a Roman African; was the bishop of Hippo Regius ["the ancient name of the modern city of Annaba, in Algeria": en.wikipedia.org])
(iii) laze (vi or vt; back-formation from adjective lazy)
https://www.merriam-webster.com/dictionary/laze

choi

(b) "But in 2005 this backwater bank incurred the wrath and might of the world's financial hegemon. America's Treasury accused it of laundering money for North Korea, prompting depositors to panic '出現擠提，在短短兩天被提走了三億澳門元，佔滙業總存款額十分之一，不過銀行稱有足夠現金應付': zu.wikpedia.org for 滙業銀行] * * * The Treasury subsequently barred American financial institutions from holding a correspondent account for the bank, excluding it from the American financial system. * * * Its [Dollar's] dominance reflects what economists call network externalities: the more people use it, the more useful it becomes to everyone else. One person's willingness to accept dollars from another depends on a third person's readiness to accept dollars from them.  The dollar also benefits from a hub-and-spoke model for the exchange of currencies, the invoicing of trade and the settlement of international payments, as the late Ronald McKinnon of Stanford University argued. * * * If you cannot buy the afghani with the zloty, you can still sell one for dollars with which to buy the other.  Likewise, if every international bank keeps an account in New York, any bank can transfer funds to any other through the same financial hub. * * * This gives America's Treasury great punitive power and jurisdictional reach. Many companies that do not buy or sell wares in America nonetheless make or collect payment through New York. Because these transfers pass through American financial institutions, the Treasury can claim jurisdiction on the ground that its banks are exporting financial services to the bad guy. * * * Not all dollar settlements are subject to American jurisdiction. It is, for example, possible to clear large dollar payments in Tokyo, Hong Kong and elsewhere. But the pipes are narrow. America's two big payments systems, Fedwire and CHIPS, handled transactions worth $4.5trn a day in 2017. Hong Kong's system (which runs through HSBC, a private bank) dealt with only 0.8% of that amount. Moreover, the ability of offshore dollars to enter and leave the American financial system if necessary is vital to their appeal. The liquidity of Hong Kong’s system, for example, is buttressed by HSBC's ability to handle dollars in New York."
(i) For network externalities, see network effect
https://en.wikipedia.org/wiki/Network_effect
("A positive externality is created when a telephone is purchased without its owner intending to create value for other users * * * Negative network externalities can also occur, where more users make a product less valuable, but they are more commonly referred to as "congestion" (as in traffic congestion or network congestion)" )
(A) Other examples are VHS (beat Betamax) and Microsoft (operating system and for a time, its Internet Explorer as a Web browser).
(B) externality (n): "a secondary or unintended consequence  <pollution and other externalities of manufacturing>"
https://www.merriam-webster.com/dictionary/externality
(ii) Zloty
https://en.wikipedia.org/wiki/Polish_złoty

is pronounced \ ˈzlȯ-tē \ according to www.merriam-webster.com.
(iii)
(A) Fedwire
https://en.wikipedia.org/wiki/Fedwire
(operated by the United States Federal Reserve Banks [There are 12 regional Federal Reserve Banks, in Federal Reserve System which is headed by Federal Reserve Board of Governors based in Washington, DC] )
(B) Fedwire and Clearing House Interbank Payments System (CHIPS). In Wholesale Payment Systems Booklet. FFIEC, undated
https://ithandbook.ffiec.gov/it- ... nk-payments-system-(chips).aspx
("Large-value funds transfer systems differ from retail electronic funds transfer (EFT) systems, which generally handle a large volume of low value payments including automated clearinghouse (ACH) and debit and credit card transactions at the point of sale")
(C) Federal Financial Institutions Examination Council
https://en.wikipedia.org/wiki/Fe ... Examination_Council
(1979- )

is based in Washington, DC.
(D) About Us. The Clearing House LLC, undated
www.theclearinghouse.org/about
("The Clearing House [TCH] is a banking association and payments company that is owned by the largest commercial banks and dates back to 1853. * * * The Payments Company is the only private-sector ACH and wire operator in the United States, clearing and settling nearly $2 trillion in US dollar payments each day, representing half of all commercial ACH and wire volume"// at the bottom of Web page is mailing address: New York New York and Washington DC)

operates Clearing House Interbank Payments System (CHIPS) since 1970.
(E) Payment Types. Western Union, undated
https://business.westernunion.com/p/online/payment-types
(wire or Electronic Funds Transfer (EFT or ACH): "ACH transfers are an excellent lower-cost option for your less urgent payments" )

choi

(c) "China's capital controls and Europe's fiscal balkanisation weaken their currencies' claims to rival the dollar. * * * Steering clear of American jurisdiction is not quite the same as escaping American power. Even if no payments cross American territory, America could still impose extraterritorial or 'secondary' sanctions, refusing to do business with a company that does business with a blacklisted party. To blunt that threat, foreign governments would then have to foster banks, suppliers and customers that can live entirely without America.  Banco Delta Asia, for its part, has survived America's onslaught, with the help of Macau's government. It has yet to convince the Treasury to lift the ruling that stops it gaining access to America's financial system. But it is not completely cut off from the dollar. At one of its bigger branches, your correspondent was able to sell 820 patacas for a crisp $100 note, bearing the signature of a former secretary of the Treasury."
(i) pataca "is the Portuguese name for peso."  en.wikipedia.org for "pataca."
(ii) Macanese pataca  澳門圓
https://en.wikipedia.org/wiki/Macanese_pataca
("is the currency of Macau. * * * At the end of the nineteenth century, there was no single currency in use in Macau, but the predominant circulating coins were the silver Mexican dollars, the British silver trade dollars of Hong Kong and the Straits Settlements, as well as the silver dollars and fractional coinage of the neighbouring province of Canton. * * * In 1901, it was decided to have a uniquely Macau currency, and for that purpose, the Banco Nacional Ultramarino was granted exclusive rights to issue legal tender banknotes that were to be denominated in patacas. On January 27, 1906, pataca notes in denominations of 1, 5, 50 and 100 were introduced and all foreign coinage was outlawed")
(iii) Portuguese escudo
https://en.wikipedia.org/wiki/Portuguese_escudo#History
("was the currency of Portugal prior to the introduction of the euro on 1 January 1999 * * *  The word escudo means 'shield.' * * *  In Macau, the currency during the colonial period was, as it is today, the pataca")