SNB & CHF

Sterling is hovering around seven cents above last week’s lows as many short-term participants better position themselves for the UK to vote to say in the EU, even though many opinion polls show a statistical dead heat.   The German Constitutional Court dismissed claims that the ECB’s Outright Market Transactions does not violate the German Constitution. Italy’s run-off for local elections was held over the past...

The betting and events markets have shifted more decisively than the polls in favor of the UK to remain in the EU.  Sterling extended its rally from $1.4010 last Thursday to nearly $1.4785 today, as the market participants adjust positions. What is particular striking is that the asymmetrical perceptions of the personal impact of a vote to leave the EU.  The Great Graphic here was posted on Business Insider,...

It goes without question, among economists of the central planning mindset, that if a central bank can just set the right quantity of dollars[1], then the price level, GDP, unemployment, and everything else will be right at the Goldilocks Optimum. One such approach that has become popular in recent years is nominal GDP targeting. How does a central bank affect the quantity of dollars? In discussing a nominal income...

Last summer there was a serious accident at an air show in Dittingen, near Basel. Because of such incidents, the organisers of air shows have taken extra safety measures, including the training of pilots. One course for aerobatic flights attracted an unusually large number of pilots. (SRF/swissinfo.ch) --- swissinfo.ch is the international branch of the Swiss Broadcasting Corporation (SBC). Its role is to report on Switzerland and to provide a Swiss perspective on international events....

The Rhine has been home to the Atlantic Salmon, but hydroelectric plants have been blocking the fishes’ way upstream. If the wild salmon is to return to their Swiss nursing grounds, fish ladders will have to be made more accessible. It's a project WWF is working on. (SRF, swissinfo.ch) --- swissinfo.ch is the international branch of the Swiss Broadcasting Corporation (SBC). Its role is to report on Switzerland and to provide a Swiss perspective on international events. For more articles,...

Ever had to testify in a trial involving your father’s dealings in corrupt activities, and as a result had your tax records leaked for all of the public to see? Sergio Machado, the ex-head of Credit Suisse’s Brazil fixed-income business has, and now everyone knows how much he made in 2015. Sergio’s father, who goes by the same name, is a former Brazilian politician who went on to head the state run oil company...

It was just a thought…. Cartoon by Bob Rich Loose Monetary Policy Remains in Place Last week, we asked where then will silver go. Well, the price moved around this week, dipping on Thursday but then rebounding sharply on Friday. It closed up 13 cents from last week. The price of gold rose $24. This week, the Federal Reserve announced that it will not hike rates. Most economists (and traders) have long been expecting a...

Summary More than $10 trillion of government bonds now trade at negative yields. And another $10 trillion or so worth of U.S. stocks trade well above their long-term average valuations. And there’s more than $200 trillion of debt in the world. All of this sits on the Fed’s financial applecart. Does Janet Yellen dare upset it? Blame “Brexit” BALTIMORE – The U.S. stock market broke its losing streak on Thursday [and...

On the Swiss Franc Recently I enumerated the different drivers for the continuing strength of the franc. Most commentators mentioned Brexit fears, but I insisted on the low rate and yield environment in the United States after the last Non-Farm Payroll report and the FOMC. Today’s jump in sterling after changed Brexit bets confirmed my view. This anticipation of an Anti-Brexit vote was not followed by a franc decline...

Summary Today’s sterling rally is the largest since 2008. The rally began with the murder of UK MP Cox. Risk-reward favors a near-term pullback. Sterling is recording its daily advance since 2008 today.   It is up about 2.3%.  The ostensible driver is the weekend polls suggesting that, as we suspected the murder of the UK MP acting as a catalyst of sorts for public opinion.  The odds makers in the betting houses...