SNB & CHF

- Click to enlarge I had to be on Bloomberg’s Day Break with David Westin and Alix Steel earlier today. We talked about the collapse of talks to put together a new coalition following the results of the September election. I suggested that the initial reaction was exaggerated, negotiations will likely resume in some fashion, and speculation of Merkel’s demise are premature. We also discussed Brexit. I opined that...

Hayek leads the world’s largest watchmaking group (Keystone) The chief executive of the Swatch Group, a leading Swiss manufacturer of watches and jewelry, is upbeat about business prospects for the coming year. Nick Hayek says the Swatch Groupexternal link hopes to reach the ambitious target of a 7%-9% increase in sales this year. “It is not impossible. It might work if sales in [November and December] are equally...

In recent years, there has been a major debate about the respective merits of gold versus Bitcoin, even though many, not all, gold bulls are also supporters of the latter. Gold advocates generally view favourably Bitcoin’s inherent characteristics of decentralisation, finite supply and ability to operate (so far) outside of the usual interference by western central banks. Having said that, the launch of Bitcoin futures...

– Brexit budget – Grim outlook as UK economic forecasts downgrade – UK Chancellor uses housing market policy as smoke-screen for deteriorating economy – UK budget matters more than ever due to BREXIT risks – Policy on stamp duty will fail to aid worsening housing market – Real GDP expected to grow by just 1.5%, 40% less than projections 2 years ago – Households now face an unprecedented 17 years of stagnation in...

Economic Nirvana “Inflation is always and everywhere a monetary phenomenon,” economist and Nobel Prize recipient Milton Friedman once remarked.  He likely meant that inflation is the more rapid increase in the supply of money relative to the output of goods and services which money is traded for. Photo via mises.ca - Click to enlarge Famous Monetarist School representative Milton Friedman thought the US should adopt...

Summary: Coalition talks will resume in the coming days, and failing this a minority government is more likely than new elections. The is a general agreement among the political elites, and a hubris of small differences. The rate differentials and cross currency swaps show the incentive structure for holding dollars is increasing. Talks to forge a new coalition government in Germany passed the self-imposed...

Swiss Franc The Euro has fallen by 0.32% to 1.1599 CHF. EUR/CHF and USD/CHF, November 22(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates Global equities are on the march. US indices shrugged off their first back-to-back weekly decline in three months to set new record highs yesterday. The MSCI Asia-Pacific followed suit and recorded their highest close. The Dow Jones...

The Swiss had an average net household disposable income in 2015 of CHF6,957 ($7,007) a month, the Federal Statistical Office has reported. Every month, around CHF560 was spent on leisure and cultural activities – and CHF89 on cats and dogs. Average net disposable income is calculated by deducting compulsory expenditures from gross income. In 2015external link, average compulsory expenditures came to CHF2,990 a month,...

The economic data of the last two weeks was generally better than expected, the Citigroup Economic Surprise index near the highs of the year. Still, as I’ve warned repeatedly over the last few years, better than expected should not be confused with good. We go through mini-cycles all the time, the economy ebbing and flowing through the course of a business cycle. This being a particularly long half cycle, it has had...

As long as this is business as usual, it’s impossible to slash costs and boost widespread prosperity. It’s easy to go down the wormhole of complexity when it comes to figuring out why our economy is stagnating for the bottom 80% of households. But it’s actually not that complicated: the primary driver of stagnation, decline of small business start-ups, etc. is costs are skyrocketing to the point of unaffordability. As I...