Page 24 of BdL's 2018 Annual Report exposes the extent of BdL's net *negative* foreign asset position. Some thoughts below. 1/8 https://twitter.com/bdlleaks/status/1287378876889542657

Between 2017 and 2018 net *negative* foreign asset position of BdL increased by $8bn to reach $30bn. This position was roughly negative $5bn at end of 2015. This implies the cash burn or the gross reserve were depleting at the pace of $8bn per year between 2015 and 2018. 2/8

The gross reserve position of BdL was effectively funded by the USD deposits of depositors in Lebanese banks. Lebanese banks were offered exorbitant rates (~16% through the financial engineering operations of BdL) to channel their deposits to BdL. 3/8

BdL took these USD depostis to fund 3 things:
a. sustain the lira peg. This effectively made the country even less competitive. The lira was the 11/25th (depending on methodology used) most overvalued currency in the world. 4/8

b. Recapitalize the banks in lira through the financial engineering. The banks used the proceeds to pay dividends. The banks owners on receipt of dividends converted them to USD and got most of it out of the country. This exacerbated BdL's net negative foreign asset position. 5/8

c. To fund the government deficits or rather the corruption of the government. The BdL was the only willing incremental lender to the government in the last 5 years. 6/8

You can learn more about this and how Lebanon got here on this link (work done in coordination with @aliamoub). We have included a full section on solutions. Every day that goes by the cost increases and the Lebanese citizens are paying the price. 7/8 http://www.lebanoneconomics.net 

All of this work was presented to all the Lebanese political parties in Dec-2019 and Jan-2020. We are shocked by the total lack of action since then despite the acceleration in the financial and economic meltdown since then. 8/8