Tag Archives: newsletter

Surprise NFP visible in FX rates The massive surprise in the US job report was reflected in currency rates. The EUR/CHF surprisingly increased, despite weak US data. This reflects the fact that the ECB is currently considered the most dovish central bank.Consequently the biggest short speculative position is in the euro, while traders are long CHF against USD. The dollar lost 2% against the yen, 1.6% against the euro and 1.3% vs. the Swiss franc. Click to enlarge. Longer term...

  Home of the Anti-Bubble It seems like almost everybody has an opinion about Twitter (TWTR) – both the company and the stock. As for the company it seems that their “window of opportunity” to massively succeed has essentially closed as user growth and revenue have both slowed, quite dramatically, over the past 18 months. Plus management turnover is clicking at a rapid pace. Company executives typically do not leave if the firm’s future seems bright. Even the ubiquitous Co-Founder/CEO,...

  Stuffing the Futon Our friend Ramsey Su just asked what Haruhiko Kuroda and Shinzo Abe are going to do now in light of the strong yen (aside from perhaps doing the honorable thing). Isn’t it time to just “wipe out some debt with the stroke of a pen”? We will return to that question further below, but first a few words on the new Samurai futon. Apparently the Japanese are becoming more than a little antsy about Kuroda-san’s negative interest rate policy (and the threats of more of the...

  Seven Year Achievement “Read the directions and directly you will be directed in the right direction.” — Lewis Carroll U.S. consumers are at it again.  After a seven year hiatus they’re once again doing what they do best.  They’re buying stuff. PCE: personal consumption expenditures up 1% According to the Commerce Department, personal consumption expenditures (PCE), which is the primary measure of consumer spending on goods and services in the U.S. economy, increased $119.2 billion in...

“Every thinking person in America is  going to vote for you Governor Stevenson,” said an enthusiastic voter.“I am afraid that won’t do.  I need a majority,” reportedly quipped Stevenson (1952 or 1956).   The UK referendum on June 23 is the most important political event of the first half of the year.  A decision to leave could be a significant disruptive force.  No one knows for sure. It is precisely that uncertainty that is fueling the demand for insurance in the options market that...

Key points: Q/Q GDP growth: +0.1%, YoY GDP growth: +0.7% Until 2014, Swiss GDP was driven by net exports: Exports were rising more quickly than imports, which improved GDP. Positive change in the trade balance in goods: Recently only the trade balance of goods continued to increase (+8.1% YoY exports, +1.4% YoY imports in Q1/2016) Negative change in the trade balance for services (+6.7% YoY) increased more than the export of services (+2.0%). Exports of services are for example banking...

The Parasite – easily the most terrifying Superman villain Image credit: Marvel The Parasites Begin to Attach Themselves BALTIMORE – “Tommy… who are you voting for?” We put the question to a local bulldozer operator whom we’ve known for at least half a century. Tommy, now 80 years old, is the last of a dying breed. He grew up plowing the earth to grow tobacco on Maryland’s Tidewater, on the western shore of the Chesapeake Bay. In the 1970s, when tobacco farming became unprofitable, he...

The fact OPEC just agreed to agree on nothing in Vienna isn’t particularly surprising given Doha wounds are still festering from the last attempt at ‘petro-diplomacy’. But the engagement ultimately has to been knocked up as a partial success for Saudi Arabia, where it’s managed to put itself back at the centre of cartel politics by thawing the ‘freeze discussion’ on Riyadh’s terms. Confused? Don’t be. As we flagged in OPEC Politics, Doha’s failure left a very dangerous door open for...

 ECB press conference June 2 2016 Held in Vienna with Governor Nowotny Keep key ECB interest rates unchanged Will be kept at present or lower for an extended period of time, exceeding asset purchase program (80bn per month) which will end March 2017 sector program will start June 8 TLTRO start in June New measures will strengthen growth in euro area through credit expansion Very low inflation must not become entrenched in second round effects through effects on wages and prices. ECB...

The US dollar remains under pressure.  It is off for the third day against the yen and slipped below JPY109 for the first time in a little more than two weeks.  The Nikkei struggled to cope with the foreign exchange developments, lost 2.3%, the most in a month, after gapping lower.  At JPY108.50, the dollar would have given back 50% of its rally off the May 3 low near JPY105.50.   Below there, the JPY107.80 is the 61.8% retracement.   The euro is north of $1.12 after having briefly...