Monthly Archive: July 2021

Experts Said Ending Lockdowns Would Be Worse for the Economy than the Lockdowns Themselves. They Were Wrong.

2021-07-05

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2021-07-05

Real GDP: Percent Change at Annual Rate, Q4 2020 - Q1 2021
Here’s something we often heard in 2020 from experts who wanted long and draconian covid lockdowns: “Yes, these say-at-home orders are causing economic turmoil, but if you don’t lock everyone down now—and keep them locked down for a long time—your economy will be even worse off!”

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Swiss to keep Sipping from Single-Use Plastics as EU Ban takes Effect

2021-07-05

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2021-07-05

Single-use plastic items like straws and cups are no longer allowed in the 27 European Union countries. This isn’t the case in non-member Switzerland, where retailers and restaurants are taking their own approach. The EU ban on certain plastic products took effect on July 3 and covers a range of everyday items from food packaging to wet wipes.

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Post-Covid China

2021-07-05

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2021-07-05

Wuhan, China
The world should take a lesson from how East Asia ran itself in 2020. Japan had no lockdown. None. With an aging population, its death rate has been creeping up for many years. In 2020, it fell by 0.7%, as if Covid-19 was a life-saver.

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Virus Z: A Thought Experiment

2021-07-04

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2021-07-04

Let's run a thought experiment on a hypothetical virus we'll call Virus Z, a run-of-the-mill respiratory variety not much different from other viruses which are 1) very small; 2) mutate rapidly and 3) infect human cells and modify the cellular machinery to produce more viral particles.

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Inflation Is a Form of Embezzlement

2021-07-04

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2021-07-04

Monetary inflation is just a type of embezzlement. Historically, inflation originated when a country’s ruler such as king would force his citizens to give him all their gold coins under the pretext that a new gold coin was going to replace the old one. In the process of minting new coins, the king would lower the amount of gold contained in each coin and return lighter gold coins to citizens.

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Banks Urged to think Green or Face Extinction

2021-07-04

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2021-07-04

Climate change is forcing financiers to change the way they think and act. This could have a big impact on their balance sheets - and potentially their very survival. “Bankers are no longer purely financial specialists, but also connoisseurs of the environmental and social footprint of investments,” said Yves Mirabaud in his last speech as president of the Association of Swiss Private Banks in June.

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Death and Libertarianism

2021-07-03

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2021-07-03

Whenever a government program or policy produces deaths of innocent people, the way I figure it is that that makes it incumbent on libertarians to take a firm stand against such programs and policies. We all know that there are all sorts of government regulations that deprive people of liberty that we libertarians need to oppose.

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Swiss Meat and Eggs often not very Swiss

2021-07-03

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2021-07-03

Any animal raised and slaughtered in Switzerland can be labelled Swiss. However, what the animal has been fed could be from anywhere. If animals are what they eat then much of the meat and eggs labelled Swiss aren’t very Swiss.

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FX Daily, July 02: US Jobs and OPEC+ Day

2021-07-02

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2021-07-02

The US jobs report and OPEC+ decision are awaited. The dollar remains bid.  Only the yen and Canadian dollar are showing a hint of resilience, though, on the week, the Scandis and dollar-bloc currencies are off between around 1-2%. The greenback is also firmer against the emerging market currency complex, and the JP Morgan index is off for the sixth consecutive session.

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Swiss Roaming Charges to Fall on 1 July 2021 but the Roaming Minefield Remains

2021-07-02

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2021-07-02

On 1 July 2021, Switzerland’s revised telecommunications law came into effect. The new rules force mobile providers to make certain changes to deals they offer customers when roaming. Some of the resulting changes are positive, but not all. In addition, some operators have retained bundles that don’t comply with the new rules.

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The Tyranny of the Covid-19 Eviction Moratorium

2021-07-02

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2021-07-02

The U.S. Supreme Court recently permitted the eviction moratorium established by the Centers for Disease Control to continue, at least until July 31, when the CDC plans to lift it. The Court wrongly decided the matter. It should have immediately lifted the moratorium.

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Anyone Remember That Whole SLR Cliff?

2021-07-02

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2021-07-02

UST Yield Curve
Does anyone remember the SLR “cliff?” Of course you don’t, because in the end it didn’t seem to make any difference. For a few weeks, it was kind of ubiquitous if only in the sense that it was another one of those deep plumbing issues no one seems able to understand (forcing all the “experts” to run to Investopedia in order write something up about it).

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The Systemic Risk No One Sees

2021-07-02

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2021-07-02

Inequality Income, 1980 - 2021
My recent posts have focused on the systemic financial risks created by Federal Reserve policies that have elevated moral hazard (risks can be taken without consequence) and speculation to levels so extreme that they threaten the stability of the entire financial system.

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FX Daily, July 01: The Greenback is Bid to Start the Second Half

2021-07-01

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2021-07-01

Soft Asian manufacturing PMIs weighed on local shares after the S&P 500 set new record highs yesterday. European shares are recouping yesterday's month-end losses, while US futures indices are bid. The US 10-year yield is around 1.47%, and European yields are 1-2 bp higher. 

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Swiss Consumer Price Index in June 2021: -0.6 percent YoY, +0.1 percent MoM

2021-07-01

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2021-07-01

Switzerland Consumer Price Index (CPI) YoY, June 2021
The consumer price index (CPI) increased by 0.1% in June 2021 compared with the previous month, reaching 101.1 points (December 2020 = 100). Inflation was +0.6% compared with the same month of the previous year. These are the results of the Federal Statistical Office (FSO).

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Swiss Retail Sales, May 2021: +2.3 percent Nominal and +2.8 percent Real

2021-07-01

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2021-07-01

Switzerland Retail Sales YoY, May 2021
urnover adjusted for sales days and holidays rose in the retail sector by 2.3% in nominal terms in May 2021 compared with the previous year. Seasonally adjusted, nominal turnover fell by 1.9% compared with the previous month. These are provisional findings from the Federal Statistical Office (FSO).

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Swiss Government Sets Sights on F-35A Fighter Jet Fleet

2021-07-01

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2021-07-01

The Swiss government wants to upgrade the country’s air defence system by buying 36 F-35A fighter aircraft from United States manufacturer Lockheed Martin and five Patriot surface-to-air missile units from another US firm Raytheon.

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When Expedient “Saves” Become Permanent, Ruin Is Assured

2021-07-01

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2021-07-01

The belief that the Federal Reserve possesses god-like powers and wisdom would be comical if it wasn't so deeply tragic, for the Fed doesn't even have a plan, much less wisdom. All the Fed has is an incoherent jumble of expedient, panic-driven "saves" it cobbled together in the 2008-2009 Global Financial Meltdown that it had made inevitable.

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The Fed’s Power over Inflation and Interest Rates Has Been Greatly Exaggerated

2021-07-01

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2021-07-01

It is widely held that the central bank is a key factor in the determination of interest rates. By popular thinking, the Fed influences the short-term interest rates by influencing monetary liquidity in the markets. Through the injection of liquidity, the Fed pushes short-term interest rates lower. Conversely, by withdrawing liquidity, the Fed exerts an upward pressure on the short-term interest rates.

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