Tag Archive: public debt

Central Bank Wonderland is Complete and Now Open for Business — The Epocalypse Has Fully Begun

Summer vacation is here, and the whole global family has arrived at Central-Bank Wonderland, the upside-down, inside-out world that banksters and their puppet politicians call “recovery.” Everyone is talking about it as wizened traders puzzle over how stocks and bonds soared, hand-in-hand, in face of the following list of economic thrills:

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Stockman Rages: Ben Bernanke Is “The Most Dangerous Man Walking This Planet”

Ben Bernanke is one of the most dangerous men walking the planet. In this age of central bank domination of economic life he is surely the pied piper of monetary ruin. At least since 2002 he has been talking about “helicopter money” as if a notion which is pure economic quackery actually had some legitimate basis.

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There Is Now A Staggering $11.7 Trillion In Negative Yielding Debt

It was not even a month ago when we last looked at the total amount of negative yielding debt around the globe, and were shocked to find that according to Fitch, for the first time in history (obviously), there was over $10 trillion in negative yielding debt. Fast forward 4 weeks later, and the grand total is now $1.3 trillion higher, or $11.7 trillion.

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With Daily Record Lows: Chart of German Bund Yields Since 1977

The German Bund chart is very important for us, because the Swiss franc is negatively correlated to German government bond yields. The lower Bund yields, the stronger the Swiss Franc. When European governments and the ECB are ready to pay higher interest rates, then CHF depreciates.

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Heretical Thoughts and Doing the Unthinkable

  Heresy! NORMANDY, France – The Dow rose 222 points on Tuesday – or just over 1%. But we agree with hedge-fund manager Stanley Druckenmiller: This is not a good time to be a U.S. stock market bull.   Legendary former hedge fund manager Stanley Druck...

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Weak CHF during the Fat Years of the Joseph Cycle

In December 2015, the seven year Joseph cycle ended with a Fed rate hike. These lean years of the Joseph cycle started in December 2008 when the Fed lowered rates to the current level. We think that in the next seven year cycle, even the risk-averse Swiss investors will buy more foreign assets, not only the central bank and speculators. Different crises have passed in the three parts of the world, the U.S. subprime, the euro crisis and the Emerging...

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What Drives Government Bond Yields, Part2: Emerging Markets and Recent Discussions

Two additional criteria important for Emerging Markets: High foreign debt, a weak net investment position and a current account deficit increases government bond yields.

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Debt Reduction, the new Financial Cycle, an Important Driver of EUR/CHF

In this analysis we describe why the long-lasting financial cycle of debt reduction is one key driver of the EUR/CHF exchange rate. We claim that EUR/CHF can rise more strongly only when the competitiveness of the European periphery increases. When this happens, then debt will be reduced and both public and private deficit spending will stop.

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Explaining Richard Koo to Paul Krugman, to Austrian Economists and the SNB



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Fast Fact: Germany paid 5% Interest and Had 0.5% Average Growth between 1996 and 2002

Most recently the Bundesbank critised the ECB decision to reduce Italian yields contained in the OMT program. To put things into perspective: Germany paid 5% interest for 10 years government bonds between 1996 and 2002. This at average inflation-adjusted GDP growth rates of 0.5%.   But there was no ECB that was buying German bonds …

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The Euro Crisis: the Reasons



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The Biggest Bubble of the Century is Ending: Government Bond Yields

Government bond yields under 10 years for safe-havens are close to zero. In April 2013, even 20 year bond yields are less than 3%, What can explain this bubble of the century? Update August 16, 2013: So, 10-year Treasury yields have ended the day closer to 3 per cent. But not as close as they … Continue reading »

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