Tag Archive: newsletter

Investigating suspected welfare cheats – where to draw the line

2018-10-28

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2018-10-28

Welfare-investigation-Switzerland
On 25 November 2018, Swiss will vote on whether to accept laws allowing detectives to uncover welfare fraud. Currently, there is nothing specific in Swiss law covering the practice. In the past, investigators have been used to gather evidence on disability and accident beneficiaries. Between 2009 and 2016, detectives were used on around 220 investigations a year, of which around two thirds were found guilty of fraud.

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Switzerland expecting a 2.5 billion franc federal surplus for 2018

2018-10-28

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2018-10-28

The latest figures forecast Switzerland’s federal spending for 2018 will be CHF 0.9 billion less than expected. This and higher than expected receipts of CHF 1.3 billion add up to an extra CHF 2.2 billion on top of an original budget surplus of CHF 0.3 billion, bringing the total forecast federal surplus to CHF 2.5 billion.

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Self-Employment declining in Switzerland

2018-10-27

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2018-10-27

Self Employed Switzerland
The percentage of Switzerland’s workers working for themselves has been slowly declining. In 2010, 13.7% of workers were self-employed. By 2017, the figure was 12.8% – self-employed includes those working as independents and those working for companies they own.

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Monthly Macro Monitor – October 2018 (VIDEO)

2018-10-27

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2018-10-27

Monthly Macro Monitor October 2018
Economic thoughts and analysis from Alhambra Investments CEO Joe Calhoun.

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Contrasting growth in cantonal GDP in 2016

2018-10-26

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2018-10-26

Gross Domestic Product (GDP) by Greater Region and Canton, 2016
After a moderate 2015, economic growth increased slightly in most Swiss cantons in 2016. The most pronounced growth in the gross domestic product (GDP) was seen in the cantons of Vaud (+7.4%) and Schaffhausen (+4.2%). These results are taken from initial estimates of the Federal Statistical Office (FSO).

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Swiss still World’s Richest

2018-10-26

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2018-10-26

Swiss-wealth
According to the annual wealth report produced by Credit Suisse, Switzerland leads on wealth per adult with US$ 530,240, comfortably ahead of second-placed Australia where the figure is US$ 411,060. The US is third with US$ 403,060.

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No Such Thing As An 80 percent Boom

2018-10-26

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2018-10-26

Payrolls LF Participation, Jan 1995 - 2018
Many attribute the saying “a rising tide lifts all boats” to President John Kennedy. He may have been the man who brought it into the mainstream but as his former speechwriter Ted Sorenson long ago admitted it didn’t originate from his or the President’s imagination. Instead, according to Sorenson, it was a phrase borrowed from the New England Chamber of Commerce or some such.

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Eastern Monetary Drought

2018-10-26

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2018-10-26

Looking back at the past decade, it would be easy to conclude that central planners have good reason to be smug. After all, the Earth is still turning. The “GFC” did not sink us, instead we were promptly gifted the biggest bubble of all time –  in everything, to boot. We like to refer to it as the GBEB (“Great Bernanke Echo Bubble”) in order to make sure its chief architect is not forgotten.

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FX Daily, October 25: ECB Overshadowed by Equity Market Drama

2018-10-25

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2018-10-25

The Dollar Index broke above 96.00 yesterday and is consolidating today. Provided the 96.00 area holds, the next target is the year's high near 97.00. The euro has been confined to a little more than a quarter of a cent. Players seem reluctant to sell it below $1.14 and note there is a 570 mln euro option at $1.1420 that expires today.

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Tax System Problems Result in CHF 1.8bn Shortfall

2018-10-25

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2018-10-25

The Federal Tax Administration’s IT project Insieme was a financial disaster and its replacement isn’t much better, according to the Swiss Federal Audit Office (SFAO). Systems are unreliable and underperforming, with billions in tax demands still outstanding.

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Gloomy Signals for Euro Area Manufacturing

2018-10-25

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2018-10-25

Euro Area Composite PMI and GDP growth, 2003 - 2018
The euro area economy started the fourth quarter on a weak note; the flash composite PMI dipped to 52.7 in October from 54.1 in September. Both manufacturing and services showed a notable loss of momentum. A common feature in France and Germany was the weakness in manufacturing, where both countries posted similar declines.

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UBS Warns Trump’s Trade Fights Are ‘Reversing 15-Years Of Global Progress

2018-10-25

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2018-10-25

UBS Hard Brexit
Protectionism has cross-party support in the U.S., and nationalist parties continue to gain traction in Europe. Where there is inequality, there is a surge in protectionism; a risk that could trigger the next global economic crisis sometime around 2020.

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FX Daily, October 24: Disappointing Flash PMI Weighs on Euro

2018-10-24

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2018-10-24

The US dollar is firmer against the major currencies and most emerging market currencies.  While the seemingly fragile equity markets are still the center of investors' attention, the weakness of the eurozone flash PMI is disconcerting and has sent the euro closer to $1.14.  China's officials continue to unveil initiatives to minimize the disruption of the equity and debt markets while seemingly adding to moral hazard risks. 

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Mountain regions to benefit from digital push

2018-10-24

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2018-10-24

A campaign has been launched to promote digitalisation in small companies based in Swiss mountain regions. On Wednesday, the Federation of Adult Learning and Swiss Mountain Aid presented a project for companies with fewer than 50 employees to allow for training in internet technology.

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Monthly Macro Monitor – October 2018

2018-10-24

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2018-10-24

Economic Growth & Investment
Stocks have stumbled into October with the S&P 500 down about 6% as I write this. The source of equity investors’ angst is always hard to pinpoint and this is no exception but this correction doesn’t seem to be due to concerns about economic growth. At least not directly.

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Europe Challenged

2018-10-24

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2018-10-24

Europe is in an untenable position. It is being challenged on many fronts. A weaker euro need not result, but it is the path of least resistance. The economy has lost its momentum. What was first written off as a soft patch, now looks a bit more serious.

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FX Daily, October 23: Stock Slump Pushes Yields Lower and Buoys Yen

2018-10-23

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2018-10-23

There is one main story today, and that is the resumption of the slide in equities. It is having a ripple effect through the capital markets. Bond yields are tumbling. Gold is firm. The dollar is narrowly mixed, though the yen stands out with almost a 0.5% gain. Most of the large equity markets in Asia, including Japan, China, Hong Kong, Korea, and Taiwan were off mostly 2%-3%.

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Cool Video: Bloomberg Discussion of Late US Cycle

2018-10-23

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2018-10-23

An assessment of the US economy is an important input into the expectations of the dollar's behavior in the foreign exchange market. As a currency strategist, my views of the US economy are often subsumed in discussions or talked about indirectly by talking about Fed policy.  However, in this clip with Alix Steel and David Westin, I have an opportunity to sketch outlook for the US economy.

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The Coming Inflation Threat

2018-10-23

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2018-10-23

Inflation, consumer prices for US 1970-2010
Falling asset inflation plus rising cost inflation equals stagflation. Inflation is a funny thing: we feel it virtually every day, but we’re told it doesn’t exist—the official inflation rate is around 2.5% over the past few years, a little higher when energy prices are going up and a little lower when energy prices are going down.

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Useless But Not Worthless, Report 21 Oct 2018

2018-10-22

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2018-10-22

Price of Franc vs Swiss M0
Let’s continue to look at the fiasco in the franc. We say “fiasco”, because anyone in Switzerland who is trying to save for retirement has been put on a treadmill, which is now running backwards at –¾ mph (yes, miles per hour in keeping with our treadmill analogy). Instead of being propelled forward towards their retirement goals by earning interest that compounds, they are losing principal.

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