Tag Archive: newsletter

Nestlé invests CHF99 million in factory expansion in Indonesia

The Swiss food giant has announced plans to invest CHF99 million (around $100 million) to expand three factories in Indonesia. The goal is to increase Nestlé’s production capacity in the country by 25%, according to a company announcement on Wednesday.

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FX Daily, July 31: Sterling Steadies, Attention Shifts to FOMC

Overview: After a shellacking in recent days, sterling has stabilized though there is not much of a bounce to speak of, suggesting the adjustment to the risk of a no-deal Brexit may not be complete. After the S&P 500 posted back-to-back declines, Asia Pacific equities struggled. Hong Kong shares led the regional decline.

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SNB reports a profit of CHF 38.5 billion for the first half of 2019.

The Swiss National Bank reports a profit of CHF 38.5 billion for the first half of 2019. The profit on foreign currency positions amounted to CHF 33.8 billion. A valuation gain of CHF 3.8 billion was recorded on gold holdings. The profit on Swiss franc positions was CHF 1.1 billion. The SNB’s financial result depends largely on developments in the gold, foreign exchange and capital markets.

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Main Street Small Business on the Precipice

As a generality, the average employee (including financial pundits) has no real experience or understanding of what it takes to start and operate a small business in the U.S. Government employees in the agencies that oversee and enforce regulations on small businesses also generally lack any experience in the businesses they regulate.

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Switzerland’s first integrated crypto asset exchange launched

Smart Valor, the country’s first integrated cryptocurrency exchange offering custody, trading and brokerage, has gone live with nine crypto-fiat trading pairs. The assets on Zug-based platform, that was launched in 2017 as part of the Thomson Reuters Incubator, includes crypto currencies and security tokens.

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FX Daily, July 30: Sterling Pounded

Overview:  The prospect of a no-deal Brexit continues to pound sterling lower.  A little more than two months ago, it was testing $1.32.  Two weeks ago it was around $1.25.  Today it traded near $1.2120 before stabilizing.  On the other hand, the 10-year Gilt yield is below 65 bp, a new multiyear low, while the international-laden FTSE 100 is holding its own in the face of heavier equity prices in Europe.

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Obvious Capital Consumption, Report 28 Jul

We have spilled many electrons on the topic of capital consumption. Still, this is a very abstract topic and we think many people still struggle to picture what it means. Thus, the inspiration for this week’s essay. Suppose a young man, Early Enterprise, inherits a car from his grandfather. Early decides to drive for Uber to earn a living. Being enterprising, he is up at dawn and drives all day.

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Switzerland assists Japanese probe into Carlos Ghosn 

Canton Zurich’s public prosecutor is assisting the Japanese authorities in an inquiry related to bank accounts associated with Carlos Ghosn, the former leading auto executive. Tokyo prosecutors sent a request for legal assistance to Switzerland in January, a spokesperson for the country's Federal Office of Justice (FOJ) told swissinfo.ch.

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China’s Big Gamble(s): Betting on QE Again?

As an economic system, even the most committed socialists had come to realize it was a failure. What ultimately brought down the Soviet Union wasn’t missiles, tanks, and advanced air craft, it was a simple thing like bread. You can argue that Western military spending forced the Communist East to keep up, and therefore to expend way too much on guns at the expense of butter.

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Uptick in site deposits puts the spotlight on SNB intervention in the franc

Has the SNB started to intervene. The weekly site deposit data from the Swiss National Bank showed a small uptick but with some perspective, it's a notable turn. Bloomberg highlights the bump and what looks like a bid to keep EUR/CHF above 1.10.

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FX Daily, July 29: Prospects of a No-Deal Brexit Weigh on Sterling

Unrest in Hong Kong and disappointing earnings reports from South Korea weighed on local equity markets, and the MSCI Asia Pacific Index fell for the third consecutive session. European equities are edging higher in tentative trading. The Dow Jones Stoxx 600 is firmer for the sixth session of the past seven. US shares are little changed after record-high closes before the weekend.

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Lucerne Considers Coach Tax, other Measures to Manage Tourist Influx

One of the most popular destinations in Switzerland is reviewing its tourism strategy and mulling introducing coach fees in a bid to curb traffic woes and other disruptions caused by the large number of tourists it welcomes.

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World’s Central Banks End Pact That Limited Selling Of Gold

In a surprising announcement on Friday morning, the European Central Bank said the 21 signatories of the 4th Central Bank Gold Agreement (CBGA) "no longer see the need for formal agreement" as the market has developed and matured, and as a result the signatories "decided not to renew the Agreement upon its expiry in September 2019."

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FX Weekly Preview: The FOMC and US Jobs Headline the Week Ahead

There is little doubt that the Federal Reserve will ease monetary policy at the conclusion of the FOMC meeting on July 31. We never thought the chances of a 50 bp move were anything but negligible, though even at this late stage, the market appears to be pricing in about a one-in-five chance.

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Why Is What Was Once Affordable to Many Now Only Affordable to the Wealthy?

Let's start with an excerpt from a recent personal account by the insightful energy/systems analyst Ugo Bardi, who is Italian but writes his blog Cassandra's Legacy in English: Becoming Poor in Italy. The Effects of the Twilight of the Age of Oil.

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Federal Court to give verdict on UBS tax evasion case 

The Swiss Federal Court is to decide on Friday whether Swiss bank UBS should handover data on its French clients to Paris tax authorities as part of a crackdown on suspected tax evasion. The decision has been described as key for Swiss banking circles.

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Real Estate Perfectly Sums Up The Rate Cuts

It’s only a confusing when you just accept the booming economy of the unemployment rate. From this perspective, 2018 was, and more so 2019 is, a downright conundrum. By all mainstream accounts, this just shouldn’t be happening.

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Expat Swiss Celebrated at Historic Winegrower’s Festival

The expatriate Swiss community has been attending the once-in-a-lifetime Fête des Vignerons, currently taking place on the shores of Lake Geneva. A delegation of Swiss citizens living across the world, including leading members of the Organisation of the Swiss Abroadexternal link (OSA), gathered in Vevey to participate in the event on Thursday.

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Seven Points on the ECB and the Price Action

As soon as it was clear that the ECB was not easing today, the euro began to recover, after making a marginal new low for the year (just above $1.11). Draghi made it clear that easing was going to be delivered in September and on several fronts including rates (with mitigating measures like tiering) and new asset purchases (not decided on instruments, which plays into speculation of equity purchases—though I strongly doubt this will materialize).

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US Economic Crosscurrents Reach the 50 Mark

In the official narrative, the economy is robust and resilient. The fundamentals, particularly the labor market, are solid. It’s just that there has arisen an undercurrent or crosscurrent of some other stuff. Central bankers initially pointed the finger at trade wars and the negative “sentiment” it creates across the world but they’ve changed their view somewhat.

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