SNB & CHF

The weak growth, large output gap, low return on capital, and a host of other economic malaise are widely recognized.  There seem to be two main schools.   One is associated with Reinhart and Rogoff.    They argue that "this time is not different" and that much of disappointment with economic performances are what should be expected given the end of a historic credit cycle and debt crisis.  The other is associated with Summers, who resurrected Alvin Hanson's 1938 secular stagnation...

A subdued Chinese session, with the yuan, little changed and local equities securing minor gains, let market participants look elsewhere for directional cues.   The new lows in oil, near $30 a barrel, and the bankruptcy filing of Glencore's US subsidiary Sherwin Alumina seemed to weigh on the dollar-bloc currencies.   However, it is sterling today that has the distinction of being the weakest of the majors.  It is off about 0.4% near midday in London following disappointing BRC sales (0.1...

While the strong Swiss franc is causing headaches for mid-ranged hotels, it is attracting foreign investors looking for hotels in the luxury sector. (RTS/swissinfo.ch) For many, Switzerland is a byword for luxury hospitality, stretching back more than a century to when ailing British aristocrats sought health treatments or adventurous travellers crossed the Alps. Many of the hotels that served these clients now require extensive renovations to remain competitive. Increasingly, hoteliers...

Since the start of 2016, women from non-European Union countries can no longer obtain special resident permits to work in Swiss strip clubs. A former cabaret owner speaks out. (SRF/swissinfo.ch) For the past 20 years a special version of the short-term “L” work permit was issued exclusively to cabaret and exotic dancers from countries not in the EU or the European Free Trade association (EFTA). The special status for cabaret dancers was introduced in 1995 and it allowed women from...

Jamie Dimon, JP Morgan ChaseBrian T. Moynihan, Bank of AmericaMichael Corbat, Citigroup Gentlemen: On Friday, I attended a digital money summit at the Consumer Electronics Show. I am writing to you to warn you about the disruption that is about to occur in banking. There are many startups (and larger companies too) that are gunning for you. Perhaps you have watched what Uber has done to the taxi business? Well, these guys are planning the same thing for the banking business. Banks used to...

I was canoeing recently.  When I looked that oar in the water, it looked bent.  It wasn't my equipment, and I am a novice.  I cursed to myself and quickly pulled the oar from the water.  I smiled.  It was not bent.  It was an optical illusion. There is a chart that is making the rounds.  It shows the S&P 500 moving in tandem with the Shanghai Composite.  I have tried to recreate the Great Graphic on Bloomberg.  It does look like a good fit. but do no be misled.  The two different...

The broad measures of the US dollar are trending higher, and former Fed Chair Bernanke recently refuted claims the US was engaged in a currency war. Many observers had thought that with its unprecedented asset-purchase program, the BOJ was engaged in a currency war.  However, the yen has been the strongest major currency over the past six months, and its export volumes are contracting on a year-over-year basis.  Not to worry.  Observers who seem almost to have a pathological...

EM starts the week under broadbased pressure.  We downplay reports of competitive devaluations under way because of China’s FX moves, however.  Many in EM in experiencing negative terms of trade shocks, and so their currencies are expected to depreciate.  We do not think any policymakers in EM want a weaker currency, as most are fighting to lend support via intervention and other means.   The multi-year EM boom has ended, and valuations across all asset classes are being adjusted.  This...

Chinese shares continued last week's plunge, with the Shanghai Composite off 5.3% and the Shenzhen Composite falling 6.6%.  Both indices closed on their lows.  With the apparenthelp of officials, the onshore yuan strengthened, though the real squeeze was in the offshore yuan, which strengthened by nearly 1%, the most in four months.   Excluding the Japanese markets that were closed for a national holiday, the MSCI Asia-Pacific Index shed about 1.8%.  However, a more stable tone has been...

No doubt, many people were excited on Thursday to see a spike in the silver price. The big news almost seemed like it would be a spike in the silver price. We were not quite so exuberant, tweeting (follow us on Twitter @Monetary_Metals): “What happened to silver supply and demand fundamentals this morning?!” We expected it to be a teaser for today’s Report. However, the silver market took back the entire price move, and more, in about 13 hours. Here is a close-up, showing Thursday morning...