IT IS registered in Luxembourg, the "offshore" domicile of many hedge funds. It has hundreds of billions of euros with which to place macroeconomic bets. And from July 1st the newly formed European Financial Stability Facility, the special-purpose vehicle (SPV) set up to support ailing euro-zone countries, is even being run by a former hedgie. But this is one fund that will never short its investments.

Klaus Regling owes his appointment as the SPV's chief executive to his nationality as well as his expertise. The fund will be able to borrow as much as €440 billion ($537 billion) to lend to struggling countries. Its borrowing will be guaranteed by euro-zone countries, and Mr Regling's native Germany could be on the hook for €148 billion of those guarantees.

But his past experience also recommends Mr Regling for the job. The 59-year-old has spent the better part of four decades flitting between the IMF, Germany's finance ministry and Brussels. He played a key role in drawing up the Stability and Growth Pact in the 1990s while based at the German finance ministry. The pact, which was a condition Germany insisted on before agreeing to give up its precious D-mark, was intended to rein in profligacy among countries using the euro and prevent the mess that they are now in. Mr Regling then spent much of the past decade trying to enforce it as the director-general for economic and financial affairs at the European Commission. He also did a stint working at Moore Capital, a big hedge fund that specialises in macro strategies such as bets that currencies or commodities will rise or fall.