SNB & CHF

There’s an old saying on Wall Street that one should “buy the rumor, sell the news”, a pithy way to express the efficient market theorem. By the time an event arrives, whatever it may be, the market will have fully digested the news and incorporated it into current prices. And then the market will move on to anticipating the next event, large or small. What prompts this review of Wall Street folk wisdom is the most recent employment report. The BLS reported Friday,...

Inequality is America’s Monster Id, and we’re continuing to fuel its future rampage daily. What’s changed and what hasn’t in the past year? What hasn’t changed is easy: 1. Wealth / income inequality is still increasing. (see chart #1 below) 2. Wages / labor’s share of the economy is still plummeting as financial speculation’s share has soared. (see chart #2 below) What’s changed is also obvious: 1. Money velocity has cratered. (see chart #3 below) 2. Federal...

The $2 trillion (CHF1.89 trillion) infrastructure investment programme unveiled by Biden on Wednesday is intended to help improve the ailing national power grid, water systems, schools, bridges and road networks. Copyright 2021 The Associated Press. All Rights Reserved US President Joe Biden’s major infrastructure plan is raising high hopes for Swiss firms in the construction and building industry. Although first contracts are expected to go to local firms, experts...

Buyers know there will always be a greater fool willing to pay more for an over-valued asset because the Fed has promised us it will always be the greater fool.I realize nobody wants to hear that most of their “wealth” is nothing more than wispy Cloud Castles in the Sky that will dissipate in the faintest zephyr, but there it is: that which was conjured out of thin air will return to thin air. . I’ve assembled a few charts that reflect the illusion of financial...

As I write, the Democratic Congress is contemplating various measures designed to alleviate poverty levels in the United States. They include: the doubling of the minimum wage; the expansion of child credits. Let’s review both. The Minimum Wage Hike Congress intends to raise the federal minimum wage from $7.25 to $15. This makes various assumptions: first, that minimum wage workers themselves are indeed poor. This is wrong: they come from families with a median...

As the price of food soars in Brazil, many Nestlé employees there are struggling to feed themselves. Keystone / Peter Klaunzer The Swiss multinational is celebrating 100 years in Brazil but its poorest workers face food voucher cuts amid rising food prices caused by the pandemic. After a century of doing business in Brazil – Nestlé’s fifth largest market with CHF2.79 billion ($2.94 billion) in sales in 2020 – the Swiss food manufacturer faces the discontent of trade...

by Blerim Reka The business of fighting Covid-19 is now estimated at around $150 billion. As of March 2021, 354 million vaccine doses have been delivered – 90 percent of them to countries that are home to only 10 percent of the world’s population. If 65 to 85 percent of people have to be vaccinated to reach global immunity, then it is unlikely to happen this year. By the end of February 2021, 140 states had yet to see their first shipment, Kosovo among them...

Gold has not made new highs in many months. Gold peaked last year at US$2067 on August 6. The 7 month down leg of more than 18% as been deep enough and long enough that some commentators are now saying that the bull market has now turned to a bear market for gold.  Losing faith is understandable because falling prices feel bad. But this week we want to show that current prices may not reflect reality. We will review the story of Archegos Capital Management which...

Traditionally, Austrian theorists have focused with particular interest on the recurrent cycles of boom and recession that affect our economies and on studying the relationship between these cycles and certain characteristic modifications to the structure of capital-goods stages. Without a doubt, the Austrian theory of economic cycles is one of the most significant and sophisticated analytical contributions of the Austrian School. Its members have managed to explain...

As the collapse of Greensill Capital threatens to ensnare former PM David Cameron in a humiliating public probe, the Financial Times on Thursday reported some disturbing new details that appear to suggest Greensill wasn’t merely reckless, but potentially guilty of a Wirecard-style fraud. According to the FT, Greensil’s administrator – who is responsible for winding down whatever assets remain and managing creditors’ claims – “has failed to verify invoices...