Category Archive: 1) SNB and CHF

Weekly Sight Deposits: No SNB Interventions, Short CHF nearing records

Who has read Milton Friedman knows that the Trump reflation trade is now showing its positive side. US wages are rising by 2.5%, while inflation is still relatively low. According to Friedman, inflation will increase only later.

Read More »

Wie die SNB durch Kapitalsteuern die Schweizer Wirtschaft belastet

Vor dem Hintergrund eines angeblich „schwachen Wirtschaftswachstums“ rechtfertigte SNB-Chef Thomas Jordan neulich in einem Interview in der Tagespresse die SNB-Negativzinsen und bezeichnete diese als „expansiv“. Nur: Sind Negativzinsen wirklich „expansiv“? Sind diese nicht viel eher „restriktiv“ und bremsen unsere Wirtschaft – bewirken also genau das Gegenteil von dem, was die SNB behauptet?

Read More »

The War On Cash Is Happening Faster Than We Could Have Imagined

It’s happening faster than we could have ever imagined. Every time we turn around, it seems, there’s another major assault in the War on Cash. India is the most notable recent example– the embarrassing debacle a few weeks ago in which the government, overnight, “demonetized” its two largest denominations of cash, leaving an entire nation in chaos.

Read More »

Weekly Sight Deposits: Investors hedge with Swiss Franc again for the coming inflation cycle.

We explained the Trump reflation trade, where the Swiss Franc acts as the usual inflation hedge against the obviously inflationary policies of Trumpeconomics. Trump is about tax cuts – i.e. a fiscal deficit up to 10%, and about protectionism. Trump would restrict global trade and push up U.S. wages.

Read More »

Swiss banks taking more risks to compensate for record-low interest rates

Swiss banks focused on property lending are taking more risks to compensate for the impact of record-low interest rates, increasing the threat of a real-estate bubble, Swiss National Bank Vice President Fritz Zurbruegg said.

Read More »

L’Allemagne est le patron-sponsor de l’Eurosystem.

Lors des échanges commerciaux et interbancaires, il y a des banques émettrices de monnaie et vis-à-vis une banque réceptrice. Normalement, à la fin de la journée, tout cela devrait être ramené à l’équilibre. Ceci n’est plus le cas depuis la crise américaine de 2007 (subprimes) comme nous le voyons sur le graphique ci-dessous de quelques pays de la zone euro.

Read More »

Former CEO Of UBS And Credit Suisse: “Central Banks Are Past The Point Of No Return, It Will All End In A Crash”

Remember when bashing central banks and predicting financial collapse as a result of monetary manipulation and intervention was considered "fake news" within the "serious" financial community, disseminated by fringe blogs? In an interview with Swiss Sonntags Blick titled appropriately enough "A Recession Is Sometimes Necessary", the former CEO of UBS and Credit Suisse, Oswald Grübel, lashed out by criticizing the growing strength of central banks...

Read More »

Weekly Sight Deposits: Investors hedge against Trump’s inflationary policy with Swiss Franc.

We explained the Trump reflation trade, where the Swiss Franc acts as the usual inflation hedge against the obviously inflationary policies of Trumpeconomics. Trump is about tax cuts - i.e. a fiscal deficit up to 10%, and about protectionism. Trump would restrict global trade and push up wages. According to Lars Christensen Trumpeconomics is also about monetary stimulus: Trump would push for a more jobs and a dovish Fed, same as his fellow...

Read More »

SNB sollte Bund bis 60 Milliarden ausschütten – nur so ist der Steuerzahler sicher

Letzte Woche gab die Schweizerische Nationalbank (SNB) bekannt, dass sie für dieses Geschäftsjahr eine Milliarde Franken an Bund und Kantone ausschütten wird. Von der Presse wird dies unterschiedlich interpretiert. Einerseits nimmt man mit Genugtuung zur Kenntnis, dass die SNB überhaupt eine Milliarde ausschütten kann. Andererseits wird mit Blick auf drohendes negatives Eigenkapital der SNB gewarnt, diese müsse dringend Reserven bilden.

Read More »

Did President-Elect Trump Just Inadvertently Kill The Golden Goose?

President-Elect Trump may have just unwittingly sowed the seed of an equity market draw-down which will send even more protesters into the streets of America. Donald Trump’s stated economic policies are clearly pro-growth and if he manages to implement his pro-business, anti-regulation agenda, in the longer term they have the potential to surpass the bold and successful initiatives of Ronald Reagan.

Read More »

Swiss National Bank won’t cut record low interest rate again, survey shows

The Swiss National Bank, which has the lowest interest rate among the world’s major central banks, may be done cutting. SNB President Thomas Jordan and his fellow policy makers will keep the deposit rate unchanged at minus 0.75 percent until at least the end of the first quarter of 2019, according to the median forecast in Bloomberg’s monthly survey of economists. That would mean ignoring the International Monetary Fund’s advice to fend off inflows...

Read More »

European break up now looks more likely, says Blond

If there’s one country with reason to resent the rise of populist movements, it’s Switzerland. Twenty-two months after it abandoned its 1.20-per-euro exchange-rate cap, the Swiss National Bank still finds the franc in focus every time there’s a major event that threatens to upset markets.

Read More »

Serious Flaws in ECB’s Economic Thinking

Marc Meyer shows that the European Central Bank has big flaws in their economic thinking. Lowering the ECB Deposit Rate means depressing the economy. The ECB takes the risk when it buys Greek bonds. Should Greek bonds devalue then the ECB equity ratio falls under zero and European banks write must write-down their ECB Deposits.

Read More »

Swiss National Bank agrees to pay out 1 billion francs annually

Today, the Swiss National Bank (SNB) announced a new agreement with the Federal Department of Finance, to pay the Swiss confederation and cantons CHF 1 billion per year, as was previously the case. The deal will run from 2016 to 2020, according to an official press release.

Read More »

Federal Department of Finance and SNB enter new distribution agreement

The Federal Department of Finance (FDF) and the Swiss National Bank (SNB) have signed a new agreement regarding the SNB’s profit distribution for 2016 to 2020. Subject to a positive distribution reserve, the SNB will in future pay CHF 1 billion p.a. to the Confederation and cantons, as was previously the case. In future, however, omitted distributions will be compensated for in subsequent years if the distribution reserve allows this.

Read More »

Swiss government opposes initiative to transform monetary system

The Swiss government urged rejection of a popular initiative that would transform the monetary system and end fractional-reserve banking, according to its dispatch to Parliament. The measure seeks to put the central bank solely in charge of money supply and forbid commercial banks from granting loans that aren’t fully backed by deposits, effectively ending the way banking has been conducted for centuries.

Read More »

We’re All Hedge Funds Now – Central Banks Become World’s Biggest Stock Speculators

At first, the idea of central banks intervening in the equity markets was probably seen even by its fans as a temporary measure. But that’s not how government power grabs work. Control once acquired is hard for politicians and their bureaucrats to give up. Which means recent events are completely predictable.

Read More »

THIS Time A Swiss Franc Hedge Makes More Sense

Money markets and the Swiss franc have diverged despite a presumed increase in event risk from the U.S. Presidential election. Moreover, shorts against the Swiss franc have risen. This surprising divergence opens up a presumed opportunity use the franc as a hedge against a surprise outcome from the election. This time I agree with the strategy even as I suspect that, once again, any subsequent incremental strength in the Swiss franc will be...

Read More »

Major Currency Pairs & The Election (Video)

We focus on the Election effects regarding the major currency pairs and the US Dollar in this video. Check out the Swiss Franc and the Mexican Peso Price Action after the election. This election has probably been great for CNN`s ratings, that would be a short after the election cycle is over.

Read More »

SNB Sight Deposits November 7: No interventions, EUR/CHF under 1.08 with political jitters

Sight Deposits: show that the SNB has not intervened to sustain the euro, that dipped under EUR/CHF 1.08. We considered the 1.08 as line in sand for the SNB. The odds of Trump are rising. This causes fear and demand for Swiss Franc. The EUR/CHF fell to 1.0750. Speculators were net short CHF January 2015, shortly before the end of the peg, with 26K contracts. Then again in December 2015, when they expected a Fed rate hike, with 25K contracts. We see...

Read More »