Tag Archive: newsletter

FX Daily, October 25: Limping into the Weekend both Fighting and Talking

2019-10-25

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2019-10-25

Overview: Amazon and Intel earnings offered conflicting impulses for Asia Pacific equities, but Japanese, Chinese, Australian, and South Korean shares advanced. This will allow the regional MSCI benchmark to solidify its third consecutive weekly gain. Europe's Dow Jones Stoxx 600 is little changed, and it too is closing in on its third weekly advance.

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USD/CHF rises to one-week highs at 0.9930

2019-10-25

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2019-10-25

More levels
US Dollar strengthens during the American session after US data. Swiss Franc fails to benefit from the demand for safe-haven assets. The USD/CHF pair rebounded at 0.9890 and climbed to 0.9930, the highest level since October 17. As of writing, trades at 0.9920, up almost 20 pips for the day, on its way to the fourth daily gain in-a-row. 

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Self-censorship increases online amid data privacy concerns

2019-10-25

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2019-10-25

The Swiss are using the internet more than ever but have growing angst about companies like Facebook violating their privacy. The consequence is a rising trend to self-censorship: not looking for certain information or not expressing oneself online.

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Startups struggle to make a mark in the conservative luxury industry

2019-10-25

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2019-10-25

Swiss luxury startups are finding it difficult to break into an established market that can be averse to change due to longstanding traditions. “When I was working for an auction house a couple of years ago the chairman handed me a gadget a client had given him. It was a USB stick and he did not know what it was.”

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More Down In The Downturn

2019-10-25

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2019-10-25

IHS Markit US Manufacturing, 2012-2019
Flash PMI’s from IHS Markit for the US economy were split in October. According to the various sentiment indicators, there’s a little bit of a rebound on the manufacturing side as contrary to the ISM’s estimates for the same sector. Markit reports a sharp uptick in current manufacturing business volumes during this month.

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Bundesbank Buys Gold – Increasing Concerns About Deutsche Bank, European Banks, the Euro and Dollar

2019-10-25

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2019-10-25

German Gold Holdings MoM, 1999-2019
◆ The End Of Fiat In One Chart?◆ For the first time in 21 years, Germany has openly bought gold into its reserve holdings◆ With ECB mutiny and Deutsche Bank’s rapid demise, fears are rising of a looming financial crisis, and with that, Germany has shown a renewed interest in gold

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FX Daily, October 24: Flash PMIs Disappoint Despite Negative Interest Rates

2019-10-24

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2019-10-24

Overview: As the UK awaits the EU's decision on its request, disappointing flash PMI readings Japan, Australia, and Germany have filled the news vacuum. Sweden's Riksbank retained a hawkish tone while keeping rates on hold, and Norway's Norges Bank also stood pat. The market expects Turkey to deliver a rate cut, while the ECB meeting is Draghi's last at the helm.

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Bitcoin billionaire twins to address St Moritz crypto event

2019-10-24

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2019-10-24

Cameron and Tyler Winkelvoss, who made a fortune out of bitcoin, are to deliver a keynote speech at next year’s Crypto Finance Conference in St Moritz. The annual gathering of cryptocurrency entrepreneurs and investors has become a fixture event, running just before the World Economic Forum’s flagship Davos summit.

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Nestlé remains among top plastic polluters in the world

2019-10-24

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2019-10-24

The Swiss food giant has been placed second behind Coca-Cola in an audit of plastic waste by a coalition of environmental organisations. The results of the analysis, released on Wednesday by the Break Free From Plasticexternal link movement, prompted the authors to single out the corporations that finished in the top three for the second year in a row – Coca-Cola, Nestlé and PepsiCo – for having offered “mostly false solutions to the plastics...

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Cool Video: China Still Needs to Provide more Stimulus

2019-10-24

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2019-10-24

The IMF projects that China will expand by less than 6% in 2020, but unless China provides more stimulus, it may be difficult to achieve.  This is not only my view but also the view of Helen Qiao, the chief economist for Greater China at Bank of America.  I was on the Bloomberg set with Alix Steele and Ms. Qiao earlier today.

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Macro Housing: Bargains and Discounts Appear

2019-10-24

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2019-10-24

Housing Construction, 2009-2019
While things go wrong for Jay Powell in repo, they are going right in housing. Sort of. It’s more than cliché that the real estate sector is interest rate sensitive. It surely is, and much of the Fed’s monetary policy figuratively banks on it. When policymakers talk about interest rate stimulus, they largely mean the mortgage space.

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The Unraveling Quickens

2019-10-24

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2019-10-24

Income Gains, 1980-2015
Even if we don't measure the erosion of intangible capital, the social and political consequences of this impoverishment are manifesting in all sorts of ways. The central thesis of my new book Will You Be Richer or Poorer? is the financial "wealth" we've supposedly gained (or at least a few of us have gained) in the past 20 years has masked the unraveling of our intangible capital: the resilience of our economy, our social capital, i.e. our ability...

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JPMorgan Warns U.S. Money Market Stress to ‘Get Much Worse’

2019-10-24

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2019-10-24

Spot Gold Price
◆ Severe funding pressures in U.S. money markets tipped to resurface heading into year-end by JPMorgan who warn that financial stresses are likely to ‘get much worse’ ◆ Goldman Sachs and Bank of America also warn funding issues remain (see below) ◆ Federal Reserve will start buying $60 billion of Treasury bills every month ◆ Funding markets are on notice for a possible year-end liquidity crunch

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Germany Increase Gold Reserves In September For The First Time In 21 Years – IMF

2019-10-24

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2019-10-24

Germany Gold Reserves
◆ The gold reserves of the German Bundesbank rose in September for the first time in 21 years; German gold reserves rose to 108.34 million ounces in September from 108.25 million ounces last month◆ It was the Germany’s first gold purchase since 1998 and while the amounts are not huge at 90,000 troy ounces, it highlights the Bundesbank and German concerns about the global monetary system and euro itself as Christine Lagarde takes over the ECB

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FX Daily, October 23: Markets Lack Much Conviction, Await Fresh Developments

2019-10-23

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2019-10-23

Overview: UK Prime Minister Johnson is neither dead in a ditch as he said he would prefer to be than request an extension of Brexit, nor will the UK leave the EU at the end of the month. Yesterday's vote rejected the attempt to fast-track the legislation needed to support the divorce agreement. It all but ensures that such a delay will be forthcoming.

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Japan Tobacco staff protest over job cuts

2019-10-23

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2019-10-23

Almost 100 Japan Tobacco International (JTI) staff protested outside their Geneva headquarters on Tuesday against job cuts. Around a quarter of the Geneva workforce are affected by major restructuring plans. Last month the multinational firm behind cigarette brands like Winston, Camel and Benson & Hedges confirmed restructuring plans and job cuts. Some 268 posts out of 1,100 are due to be cut at the Geneva headquarters.

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August TIC: Trying To Get Collateral Out of the Shadows

2019-10-23

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2019-10-23

US TIC, 2013-2019
The second most frustrating aspect of trying to analyze global shadow money is how the term “shadow” really applies in this case. It’s not really because banks are being sneaky, desperately maintaining their cover for any number of illicit activities they are regularly accused of undertaking. The money stays in the shadows for the simple reason central bankers don’t know their jobs; even after a somehow Global Financial Crisis in 2008, they don’t...

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A New Stage of the US-China Conflict

2019-10-23

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2019-10-23

The US-China diplomatic relationship may be entering a new stage. The balance of power between the key players – Trump, China, the US Congress, and the Democrats – is changing and their roles are being reshuffled. This might be enough to break the endless cycle of agreements and re-escalations. In short, we think both Trump and Chinese officials have a greater incentive to reach a deal (or at least not to escalate) this time around.

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Yes, Gold “Just Sits There” and That’s Quite a Feat

2019-10-23

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2019-10-23

The Wall Street Journal’s Jason Zweig famously referred to gold as a “Pet Rock” in 2015. He was blasted by people who understand that gold is no passing fad, and it serves some very important roles in an investment portfolio. The valuable roles played by gold have been well covered here. It’s a hedge against both inflation and deflation, it represents true diversification for portfolios stuffed with conventional securities, and it is a way of...

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FX Daily, October 22: Trudeau will Lead a Coalition Government in Canada, while the UK’s Johnson Fights Another Day

2019-10-22

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2019-10-22

Overview: Bismark is said to have warned that laws were like sausages, and to respect them, one ought not to see how they are made. The UK had a non-binding referendum more than three years ago, and although it won by 52%-48% and the party leaders committed to adhering to the results, it still cannot figure out how to leave.

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