Earlier today, the SNB which is perhaps the most transparent hedge fund of all central banks and actually lays out its financial statements in a respectable manner every quarter, released its results for the second quarter (and first half) of 2015. The result: another absolutely epic loss, amounting to €50.1 billion ($51.8 billion) of which €47.2 billion on currency positions - a whopping 7% of Swiss GDP - meaning that in Q2 the SNB lost another €20 billion. This happened despite the SNB having invested 17%, or $94 billion, in foreign - mostly US -stocks.
The one undeniable truth about the debt drama in Greece is that each of the conventional narratives - financial, political and historical - has some claim of legitimacy. These facts matter not only because contagion from Greek debt defaults may ripple in dangerous ways through the financial system, but because they are also true for many other members of the Eurozone. The Euro is a fatally-flawed monetary concept and what we now seeing playing out was eminently predictable from the start.
Switzerland is set to open its first Bitcoin bank, multiple sources tell Handelszeitung. Meanwhile, Xapo, the self-appointed "Fort Knox" of the crypto currency world, is relocating from Silicon Valley to Zurich.
Easy come (print), easy go! A trillion here... a trillion there... Sooner or later we're talking some real money!
"Greece is to allow money held abroad by its taxpayers to be declared without penalty and taxed at a discount rate, a move to help overcome a cash crunch threatening the country with bankruptcy," Reuters reports. This may sound like a good idea in principle, but we’re not entirely sure why this represents a compelling value proposition for those who are storing their euros in the safe confines of Swiss bank accounts.
Germany had lost the war, the Nazi industrialists agreed, but the struggle would continue along new lines. The Fourth Reich would be a financial, rather than a military imperium. The industrialists were to plan for a “postwar commercial campaign.” They should make “contacts and alliances” with foreign firms but ensure this was done without “attracting any suspicion.”... The State Department’s efforts on Schacht’s behalf worked. He was initially found guilty but was then acquitted, to the fury of the Soviet judge.
It is undoubtedly a huge red flag when in one of the countries considered to be a member of the “highest economic freedom in the world” club, commercial banks are suddenly refusing their customers access to their cash. This money doesn’t belong to the banks, and it doesn’t belong to the central bank either. If this can happen in prosperous Switzerland, based on some nebulous notion of the “collective good”, which its unelected central planners can arbitrarily determine and base decisions upon, it can probably happen anywhere. Consider yourself warned.
This is not a government of the people, for the people, by the people. It is a government that takes from the people. By any means necessary. And they grow bolder with each passing day.
Breaking the Definintion of Money and Inhibiting Seigniorage (Money Printing) with Asset Backed BitcoinSubmitted by Reggie Middleton on 04/03/2015 13:01 -0400
Taking the gold-backed dollar into the next millenium and imbuing it with all of the attributes of the Bitcoin blockchain.
- ECB Starts Buying German, Italian Government Bonds Under QE Plan (BBG)
- Creditors Reject Greece's Reform Proposals (BBG)
- Is Apple Watch the Timex digital watch of the Internet era? (Reuters)
- Tesla shedding jobs in China as sales target missed (Reuters)
- Malaysia Airlines says expired battery on MH370 did not hinder search (Reuters)
- Gunmen kill more than 12 Islamic State militants in eastern Syria (Reuters)
- GM Plans Share Buyback, Averting Proxy Fight (WSJ)
- Wisconsin capital marked by third day of protests after police shooting (Reuters)
"None dare call it a “currency war” because that would be counter to G-10/G-20 policy statements that stress cooperation as opposed to “every country for itself”, but an undeclared currency war is what the world is experiencing. Close to the same thing happened in the 1930’s, a period remarkably similar to what many countries’ policies resemble today.... Negative/zero bound interest rates may exacerbate, instead of stimulate low growth rates in all of these instances, by raising savings and deferring consumption... Asset prices for stocks, high yield bonds and other supposed 5-10% returning investments, become stretched and bubble sensitive; Debt accumulates instead of being paid off because rates are too low to pass up – corporate bond sales leading to stock buybacks being the best example. The financial system has become increasingly vulnerable only six years after its last collapse in 2009.... Central banks have gone and continue to go too far in their misguided efforts to support future economic growth."
With historically low long-term interest rates, the opportunity cost of holding gold and silver are close to zero or even negative, in other words you would “lose” money if you buy bonds (the benchmark) instead of gold and silver. When people realize that their money is not “safe” with the banks they will start withdrawing cash from their accounts and buy physical gold and silver instead. Depending on circumstances this could possibly bring down the (fractional) banking system. Why keep money in an account that gives you a negative return? Swiss banks are already witnessing stronger than normal interest for physical gold.
The NYT Exposes The Criminal Money-Laundering Underworld Supporting Manhattan's Luxury Housing BubbleSubmitted by Tyler Durden on 02/07/2015 16:02 -0400
“We like the money,” said Raymond Baker, the president of Global Financial Integrity, a Washington nonprofit that tracks the illicit flow of money. “It’s that simple. We like the money that comes into our accounts, and we are not nearly as judgmental about it as we should be”... Mayor Michael R. Bloomberg said on his weekly radio program in 2013, shortly before leaving office: “If we could get every billionaire around the world to move here, it would be a godsend.”
Russell Napier: "The Most Dangerous Thing In Finance Is The Thing That Never Ever Moves - Until It Moves"Submitted by Tyler Durden on 02/06/2015 16:39 -0400
Taking interest rates so negative that they threaten a run on bank deposits should not be seen as success --- it is failure. Creating bank reserves at that pace should not be seen as success --- it is failure. The next failure may well be some government-inspired restriction on capital inflows. Well, you could call such restrictions, and risking the liquidity of banks, monetary success if you like, but then you probably also think it’s a success to throw the ball one yard from the touchline.