Response to the following questions:
1. If you expect the Swiss franc to depreciate in the near future, would a U.S.-based FI in Basel, Switzerland, prefer to be net long or net short in its asset positions? Discuss.
2. What is country or sovereign risk? What remedy does an FI realistically have in the event of a collapsing country or currency?
3. What is the difference between technology risk and operational risk? How does internationalizing the payments system among banks increase operational risk?