SNB & CHF

Swiss Franc EUR/CHF - Euro Swiss Franc, December 27(see more posts on EUR/CHF, ). FX Rates As skeleton teams return to the trading desks in New York, the US dollar is largely where they left it at the end last week.  Japanese markets were open yesterday, while UK, Australia, New Zealand, Hong Kong and Canadian markets are still closed today. The Australian and New Zealand dollars are up about 0.2% from before the...

People were poor by today’s standards, so why do people remember the plantation life fondly? The answer is simple: community, purpose, sacrifice and meaning. Allow me to connect two apparently unconnected dots. Dot #1: The last sugar plantation in Hawaii is closing down, ending more than a century of plantation life in the 50th state. Dot #2: a new study found that Nearly 95% of all new jobs during Obama era were...

It will be the middle class that accepted the notion that “real estate is the foundation of family wealth” that will be stripmined by higher taxes on immobile assets such as real estate. Correspondent Joel M. submitted an article that struck me as a harbinger of the future: In Greece, Property Is Debt: “At law courts throughout Greece, people are lining up to file papers renouncing their inheritance. Not necessarily...

In December 2016, the KOF Economic Barometer stayed at its previous month’s reading of 102.2. The currently observable sideward trend, at a level slightly above the long-term average, indicates that the Swiss economy should grow at rates close to its long-term average in the near future. In December 2016, the KOF Economic Barometer, with a value of 102.2 being unchanged compared to the previous month, continued...

Investors are familiar with a broad set of macroeconomic variables that often drive asset prices.  Many are familiar with corporate balance sheets, price-earning ratios, free cash flow, Q-ratio, and the like. However, political factors are more difficult for investors to integrate into their analysis. Therein lies the main challenge in the year ahead.  There will be many opportunities for political factors to overwhelm...

Swiss Franc Speculators were net short CHF in January 2015, shortly before the end of the peg, with 26.4K contracts. Then again in December 2015, when they expected a Fed rate hike, with 25.5K contracts. The biggest short CHF, however, happened in June 2007, when speculators were net short 80K contracts. Shortly after, the U.S. subprime crisis started. The carry trade against CHF collapsed. The...

While few will be trading in the week between Christmas and New Years, we thought it might be helpful to review the dollar’s technical condition.  We make two overall points. First, although the dollar’s rally strengthened and extended after the November US election, this leg up of the dollar’s longer-term rally began at the end of Q3.  The anticipation of new policies by the Trump Administration, part of the story,...

Stock Markets EM gained some limited traction as last week ended.  However, renewed concerns about China could limit this bounce as President Xi signaled the possibility that growth could fall below the government’s 6.5% target.  China PMI readings out this coming weekend will be the first snapshot of December.  Markets are likely to become more sensitive to Chinese data going forward. Stock Markets Emerging Markets...

In our latest Toward a New World Order, Part III we ended by promising to look closer at investment implications from the political and economic shift we currently find ourselves in; and that story must begin with the dollar. While known to the investing public for years, the Bank of International Settlements (BIS) recently acknowledge that the real risk-off / risk-on metric in global markets is the dollar and...

Shortly after last night’s news that Deutsche Bank had settled with the DOJ for $7.2 billion, of which it would pay $3.1 billion in a civil penalty, far lower than the $14 billion number initially speculated (the stock popped as much as 4% before settling just over 2% higher currently), Credit Suisse likewise closed the books on its pre-crisis RMBS fraud when the largest Swiss bank agreed to pay $5.28 billion to...