Tag Archive: newsletter

Inflation, But Only At The Morgue

2020-01-18

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2020-01-18

Mortality Rates Divided by age group, 1999-2017
Why is everyone so angry? How can socialism possibly be on such a rise, particularly among younger people around the world? Why are Americans suddenly dying off? According to one study, two-thirds of millennials are convinced they are doing worse when compared to their parents’ generation. Sixty-two percent say they are living paycheck to paycheck, with no savings and no way to get any (though they also tend to “overspend” when compared to other...

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Why Do Prudent Indians Diversify Into Gold?

2020-01-18

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2020-01-18

All That Glitters, 2013-2019
◆ Indians diversify into gold coins, bars and jewellery because it never fails them in an emergency◆ Indians are simply very prudent and practical and believe in channeling some of their wealth and saving into physical gold ◆ “A woman’s gold is both her personal treasure and plays a functional role as the family’s financial buffer” – Richard Davies

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How Do We Calculate Value?

2020-01-18

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2020-01-18

[From Socialism: An Economic and Sociological Analysis, by Ludwig von Mises, pp. 113–22.] All human action, so far as it is rational, appears as the exchange of one condition for another. Men apply economic goods and personal time and labour in the direction which, under the given circumstances, promises the highest degree of satisfaction, and they forego the satisfaction of lesser needs so as to satisfy the more urgent needs. This is the essence...

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FX Daily, January 17: China and the UK Surprise in Opposite Directions

2020-01-17

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2020-01-17

Overview:  Helped by new record highs in the US, global stocks are moving higher today. Nearly all the markets in the Asia Pacific region advanced and the seventh consecutive weekly rally is the longest in a couple of years. Europe's Dow Jones Stoxx 600 is at new record highs and appears set to take a four-day streak into next week. US shares are trading firmly.

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Swiss Producer and Import Price Index in December 2019: -1.7 percent YoY, +0.1 percent MoM

2020-01-17

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2020-01-17

Switzerland Producer Price Index (PPI) YoY, December 2019
17.01.2020 - The Producer and Import Price Index rose in December 2019 by 0.1% compared with the previous month, reaching 100.7 points (December 2015 = 100). Compared with December 2018, the price level of the whole range of domestic and imported products fell by 1.7%. The average annualised inflation rate in 2019 was –1.4%.

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Swiss National Bank expects annual profit of 49 billion francs

2020-01-17

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2020-01-17

According to provisional calculations, the Swiss National Bank (SNB) expects to make a profit of around CHF 49 billion in 2019. Most of this comes from the rising value of the SNB’s foreign currency positions (+CHF 40 billion) and a valuation gain on gold holdings (+CHF 6.9 billion).

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‘Yes to an initiative promoting moderately-priced housing’

2020-01-17

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2020-01-17

The free market in Switzerland has built housing units that remain empty because they are too expensive, or in out-of-the-way places, says Marina Carobbio Guscetti. The Social Democrat senator believes that the initiative "More affordable housing" will fix these problems. It will help the middle class and the less well-off.

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De-dollarization By Default Is Not What You Might Think

2020-01-17

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2020-01-17

CPMI Correspondent Banking Data, 2011-2018
Last month, a group of central bank governors from across the South Pacific region gathered in Australia to move forward the idea of a KYC utility. If you haven’t heard of KYC, or know your customer, it is a growing legal requirement that is being, and has been, imposed on banks all over the world. Spurred by anti-money laundering efforts undertaken first by the European Union, more and more governments are forcing global banks to take part.

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Dollar Soft Ahead of Retail Sales Data

2020-01-17

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2020-01-17

There were no surprises in the US-China Phase One trade deal. The dollar is drifting lower ahead of the key retail sales data; there are other minor US data out today. Bank of England credit survey showed demand for loans fell in Q4. Turkey cut its one-week repo rate by 75 bps to 11.25%; South Africa is expected to keep rates steady at 6.5%.

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Slice of prime Zurich real estate sold on blockchain

2020-01-17

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2020-01-17

A building on Zurich’s most exclusive shopping street has been converted into a blockchain-powered investment following its CHF130 million ($134 million) sale. It is the latest attempt to unlock the value of bricks and mortar using digitally-coded tokens.

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US Debt Makes Us Dependent on Petrodollars — and on Saudi Arabia

2020-01-17

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2020-01-17

The Iranian regime and the Saudi Arabian regime are longtime enemies, with both vying for control of the Persian Gulf region. Part of the conflict stems from religious differences — differences between Shia and Sunni muslim groups. But much of the conflict stems from mundane desires to establish regional dominance.

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FX Daily, January 16: Markets Look for New Cues with US-China Trade Pact Signed

2020-01-16

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2020-01-16

Overview: The global capital markets are calm today as investors await fresh trading incentives. New record highs in the US equity indices gave Asia Pacific stocks a lift, though China and Taiwan were notable exceptions. Europe's Dow Jones Stoxx 600 is firm new record highs set last week.  US equities are edging higher in Europe. Benchmark bond yields are little changed.

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EUR/CHF Price Analysis: Attempting corrective bounce amid oversold conditions

2020-01-16

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2020-01-16

EUR/CHF, Daily chart
EUR/CHF is looking oversold, as per key daily chart indicator. The hourly chart is reporting a triangle breakout. A corrective bounce to the 5-day average hurdle could be in the offing. EUR/CHF is looking to regain some poise from three-year lows reached on Wednesday.

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Swiss franc climbs after US adds it to ‘manipulation’ watchlist

2020-01-16

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2020-01-16

The US Treasury has called on the Swiss government to cut taxes and spend more public money, after it added the country to a watchlist of those it accuses of currency manipulation. The Swiss franc nudged up to a near three-year high against the euro on Tuesday as markets anticipated the move would limit the Swiss National Bank’s appetite for aggressive action to try to hold down its currency in future.

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Fünf Jahre Frankenschock – Wie der SNB-Negativzins die Schweizer Aktienkurse beeinflusst hat

2020-01-16

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2020-01-16

Nicht eine, sondern zwei Massnahmen erschütterten am 15. Januar 2015 die Schweiz und die internationale Finanzwelt. Der unmittelbare Schock war die Aufhebung der Kursuntergrenze zum Euro, welche die Nationalbank seit 2011 bei 1,20 Franken verteidigt hatte.

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The History and Structure of the Federal Reserve System

2020-01-16

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2020-01-16

[This article is part of the Understanding Money Mechanics series, by Robert P. Murphy. The series will be published as a book in late 2020.] This chapter will provide a brief sketch of the historical context in which the Federal Reserve was founded, summarize some of the major changes to the Fed’s institutional structure and mandate over the years, and end with a snapshot of the Fed’s current governing structure.

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Instability Rising: Why 2020 Will Be Different

2020-01-16

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2020-01-16

Shares of Gross Domestic Income, 1960-2019
In 2020, increasing monetary and fiscal stimulus will be the equivalent of spraying gasoline on a fire to extinguish it. Economically, the 11 years since the Global Financial Crisis of 2008-09 have been one relatively coherent era of modest growth, rising wealth/income inequality and coordinated central bank stimulus every time a crisis threatened to disrupt the domestic or global economy.

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Clarida Picks Up Some Data

2020-01-16

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2020-01-16

China Exports, 2006-2019
I should know better than to make declarative all-or-none statements like this. I said there isn’t any data which comports with the idea of a global turnaround, this shakeup in sentiment which since early September has gone right from one extreme to the other. Recession fears predominated in summer only to be (rather easily) replaced by near euphoria (again).

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FX Daily, January 15: Phase 1 Trade Deal Shifts Terrain of US-China Rivalry

2020-01-15

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2020-01-15

News that US tariffs on China will remain until through at least the November US election and continued US attempts to stymie China (e.g., more curbs on Huawei under consideration and stepped up efforts to force it to cut subsidies to business) have taken some momentum from the push into risk assets. The MSCI Asia Pacific Index snapped a four-day advance today, with only Australian equities among the large regional markets able to sustain upticks. 

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EUR/CHF: Franc at 33-month high five years after SNB removed the cap

2020-01-15

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2020-01-15

Technical levels
EUR/CHF is trading at 33-month lows near 1.0759. The US added Switzerland to its current manipulators' list. The SNB removed the cap on the euro on Jan. 15, 2015. Five years after the Swiss National Bank (SNB) shocked the financial markets by abandoning the euro cap, the Swiss Franc is trading at 33-month highs against the single currency. 

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