Tag Archive: Monetarist

Lessons from History: The Volcker Moment and the First Cap on CHF



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Swiss Franc History: The long-term view and the comparison with gold

We establish a long-term view and history of the Swiss franc. We compare the franc with gold.

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Overlending and Global Imbalances in Current Accounts

Some extracts from BIS Working Papers No 419 Caveat creditor: The Bank for International Settlement stresses the importance of getting "overlending" under control.

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Balance of Payments Crisis: Did the Fed Cause the Euro Crisis with Excessive Monetary Easing?

The Fed's excessive monetary easing QE2 caused an inflationary period, that created a balance of payments crisis during which the Eurozone members were obliged to introduce excessive austerity measures.

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The Inflation Lie? Why and When Inflation Will Come Back

The so-called "inflation lie" : money printing does not create inflation. The cyclical slowing in emerging markets shows that it actually did cause inflation, just not in developed economies yet.

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7b) Major Schools of Economics



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Traditional Monetarist vs. Market Monetarists

Along the double mandate of the federal reserve, monetarists can be divided into. - traditional monetarists that focus on a slow increase of money supply in order to avoid price inflation. - Market monetarists that want to target growth and income instead of inflation.

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Quantitative Easing, Gold and the Swiss Franc

The main drivers of demand for Swiss francs are the euro crisis, but even more, the behavior of American investors, who go out of the dollar in the fear of further bad US economic data and of Quantitative Easing. This will push down the dollar, and safe-havens like the CHF, gold or the Japanese Yen up. … Continue reading »

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German Economists and Merkel, the Implicit Followers of the Gold Standard

With ECB's OMT & "conditionality", that requires austerity and implicitly reduction of salaries in European periphery, Merkel & German economists have created consequences similar to a gold-standard.

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7) Economic Theory



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SNB buys Swiss Francs and sells Euro: Welcome to the EUR/CHF peg

Why the big Q1 loss of the SNB was actually a big win for the central bank Anybody watching the EUR/CHF exchange rate this year was wondering why the volatility the pair saw last year had completely left. The pair slowly fell from 1.2156 over 1.2040 at the end of Q1 to 1.2014 today. FX … Continue reading...

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Written in February 2012: Will the EUR/CHF never rise over 1.22 or 1.23 again?

Our analysis from February 2012 shows astonishing accurateness: It predicted that the euro would not rise against CHF and that the commodity currencies were overvalued and subject to correction. Basic foreign exchange theory, the SNB price stability mandate and strong fundamentals for Switzerland and bad ones for the peripheral countries of the euro zone speak for the thesis that the EUR/CHF exchange rate might never go over the level of around...

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