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This Great Graphic was tweeted by the Financial Time’s John Authers, who got it from @fathomcomment. The green line is the inversion of global trade (right-hand scale). The blue line is a trade-weighted average global tariff rate. What the chart shows is that since 1990, the decline in the average tariff coincided with an increase in trade (remember green line is inverted). However, the as chart illustrates, around the...

– Gold’s average gains in inauguration years of 15% since 1974– First year of new President frequently a time of increased uncertainties and risks– Gold rose 30% in the 12 months after Obama inauguration – Massive political uncertainty – President’s conflict with the CIA– ‘Strong dollar policy’ to end as U.S. has $120 trillion plus debt– Trump inherits Bush and Obama’s humongous debt Gold performs well in inauguration...

By Smaul gld The CIA recently released a series of declassified 1970s memos relating to the gold market and the newly created SDR. These memos give new insight how the CIA viewed the gold market, the perceived manipulation of gold and the potential for the SDR to become a gold substitute in the international monetary system. The classification of the documents is significant because “secret” is the CIA’s second-highest...

  No Country Can be Made Great by Devaluation John Connally, President Nixon’s Secretary of the Treasury, once remarked to the consternation of Europe’s financial elites over America’s inflationary monetary policy, that the dollar “is our currency, but your problem.”  Times have certainly changed and it now appears that the dollar has become an American problem. In a recent interview with the Wall Street Journal, the...

Zurich, 19 January 2017 – Switzerland’s major cities saw net prime yields for multi-family homes drop to 2.6% in 2016 from an average of 2.8%. This is equivalent to a 6% increase in net present value. These low yields are creating additional incentives for investors to seek out higher returns in less central locations. Yet the number of vacant rental apartments – which has already doubled since 2009 – is likely to...

The Producer Price Index (PPI) or officially named "Producer and Import Price Index" describes the changes in prices for producers and importers. For us it is interesting because it is used in the formula for the Real Effective Exchange Rate. When producers and importers profit on lower price changes when compared to other countries, then the Swiss Franc reduces its overvaluation. The Swiss PPI values of -6% in 2015...

Tens of millions of Americans and their employers pour money into pension plans each month, counting on those funds to grow and to be there when needed at retirement. But a time bomb awaits. The bulk of U.S. pension funds are dangerously underfunded, and the assets are often invested in securities that have bleak prospects for providing income that keeps up with a general decline in purchasing power. A pension plan...

Tens of millions of Americans and their employers pour money into pension plans each month, counting on those funds to grow and to be there when needed at retirement. But a time bomb awaits. The bulk of U.S. pension funds are dangerously underfunded, and the assets are often invested in securities that have bleak prospects for providing income that keeps up with a general decline in purchasing power. A pension plan...

Swiss Franc EUR/CHF - Euro Swiss Franc, January 17(see more posts on EUR/CHF, ) - Click to enlarge   GBP/CHF - British Pound Swiss Franc, January 17(see more posts on GBP/CHF, ) - Click to enlarge FX Rates The US dollar is broadly lower against major and emerging market currencies.  It has given up yesterday’s gains and more.  The proximate cause appears to be comments by President-elect Trump in a Wall...

Headlines Week January 13, 2017 Who has read Milton Friedman knows that the Trump reflation trade is now showing its positive side. US wages are rising by 2.5%, while inflation is still relatively low. According to Friedman, inflation will increase only later. This implies that speculators are long the dollar and short the Swiss franc and the euro during the weak inflation period. The last ECB meeting showed that the...