Tag Archives: newsletter

Last week, we discussed the tension between forces pushing the dollar up and down (measured in gold—you cannot measure the dollar in terms of its derivatives such as euro, pound, yen, and yuan). And we gave short shrift to the forces pushing the dollar down. We said only that to own a dollar is to be a creditor. And if the debtors seem in imminent danger of default, then creditors should want to escape this risk. The...

Swiss Franc The Euro has risen by 0.11% to 1.1348. EUR/CHF and USD/CHF, August 20(see more posts on EUR/CHF, USD/CHF, ) Source: markets.ft.com - Click to enlarge FX Rates The US dollar is slightly firmer against most of the major currencies, as the light participation and lack of fresh news see a consolidative tone emerge after the pullback at the end of last week. Although markets in Turkey are closed for a...

Turkey Officials have taken steps to make it more difficult and more expensive to short the lira, but that did not prevent a 5% slide ahead of the weekend. There is no interest rate, within reason, that can compensate for such currency risk. When S&P cut its sovereign credit rating to B+ from BB- and retained a stable outlook, it did not cite the dispute over the pastor. Moody’s cut Turkey’s rating to Ba3 from Ba2...

Stock Markets EM FX stabilized last week as the situation in Turkey calmed somewhat. Reports Friday that the US and China are hoping to resolve the trade dispute also helped EM FX ahead of the weekend. However, TRY remains vulnerable as the US threatens more sanctions due to the pastor. Both S&P and Moody’s downgraded it ahead of the weekend and our own ratings model points to further downgrades ahead. Turkish...

The US policy mix gets a privileged place in our understanding of what is the dollar. Tighter monetary policy and looser fiscal policy could be the closest thing to an elixir for currencies. It is the policy mix that the US is pursuing. The idea is that such a policy mixed draws capital inflows. This is exactly what is happening. The June TIC data was reported yesterday, and there was a net purchase of $114.5 bln of US...

Swiss health insurance companies are aiming to change laws to make it easier for them to unilaterally end complementary insurance contracts, according to the newspaper Le Matin. © Andrii Yalanskyi | Dreamstime.com - Click to enlarge Health insurers have managed to get this possibility included in a project aimed at revising Switzerland’s laws on insurance contracts, set for discussion by a parliamentary committee this...

If you want to preserve your sanity and avoid unhappy derangement, turn off all corporate and social media from now to Thanksgiving. Since elections are extremely profitable for traditional media / social media corporations, your sanity will gleefully be sacrificed in the upcoming election–if you are gullible enough to watch the “news” and tune into social media.Elections are extremely profitable because candidates...

Harvest figures are expected to droop somewhat after the 2018 drought. Bread wheat, barley, and rapeseed harvests look set to be considerably lower in Switzerland in 2018 compared to previous years, due to the prolonged heat and drought-like conditions this summer. The figures, collected by the Swiss granum organization, were based on data supplied by 29 cereal collection centres, covering 35% of the Swiss barley...

Americans are spending more on filling up. A lot more. According the Census Bureau, retail sales at gasoline stations had increased by nearly 20% year-over-year (unadjusted) in both May and June 2018. In the latest figures for July, released today, gasoline station sales were up by more than 21%. The last time they surged this much was September 2011, also the last time oil prices were having this big of an effect on...

See the introduction and the video for the terms gold basis, co-basis, backwardation and contango. The Fundamental Price has Deteriorated, but… Let us look at the only true picture of supply and demand in the gold and silver markets, i.e., the basis. After peaking at the end of April, our model of the fundamental price of gold came down to the level it reached last November. $1,300. Which is below the level it...