• StalingradandPoorski
    03/04/2015 - 16:46
    What people and central bankers do not understand, is that you can't devalue your way to prosperity. Absolutely nothing has changed since the last crisis. The same too big too fail banks have only...

Swiss Franc

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Everest Macro Hedge Fund Blows Up After Nearly $1 BIllion In Swiss Franc Losses





Everest Capital’s Global Fund had about $830 million in assets as of the end of December, according to a client report. The Miami-based firm, which specializes in emerging markets, still manages seven funds with about $2.2 billion in assets. The global fund, the firm’s oldest, was betting the Swiss franc would decline.  Other hedge funds that have suffered amid the Swiss turmoil, according to people familiar with the situation, are Discovery Capital Management LLC, a South Norwalk, Conn. firm that manages $14.7 billion, and Comac Capital LLP, which oversees $1.2 billion in London.

 
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"The Consequences Of The SNB Decision Will Not Be Limited To Switzerland"





Since the European sovereign-debt crisis erupted in 2009, everyone has wondered what would happen if a country left the eurozone. The risks created by the SNB’s decision – as transmitted through the financial system – have a fat tail - and the consequences will not be limited to Switzerland. After years of wondering whether the exit of a small, fiscally weak country like Greece could undermine the euro, policymakers will have to deal with an even bigger shock stemming from the exit of a small, fiscally strong country that is not even a member of the European Union.

 
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What Really Happened At The SNB Yesterday: One Person's Take





At the hastily arranged press conference on January 15, SNB's president, Jordan, looked like a red-faced school boy caught with the hand in the cookie jar. None of his explanations made any sense. The SNB was clearly caught by surprise itself and didn't have time to make up some better lies. But why this sudden change of heart, throwing in the towel causing book losses of somewhere around CHF 75bn  (>10% GDP)? Some theories...

 
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This Won't End Well





If you thought the market's reaction to the Swiss National Bank's decision was extreme... imagine what happens when this unwinds...

 
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About That "Strong" Dollar





At the moment, the US dollar is choice. This isn’t necessarily a vote of confidence for the dollar. It’s more like a vote against all the others. If big institutional investors must choose between bankrupt America and bankrupt Europe, right now they choose America. But this is a decision that can and will be changed in an instant. Just look at the Swiss franc...

 
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Stocks Pop-And-Drop After NYPost "Fed Emergency Meeting" Twitter Hack





The NY Post tweeted that "Federal Reserve head Yellen announces bail-in in emergency meeting, rumored negative rate to be set at 4pm EST today," and US equity markets briefly started to rise... followed by a tweet that "The Fed would peg the Dollar to the Swiss Franc" and "Chinese anti-ship missile fired at USS George Washington." Both seemed odd and shortly after, The NY Post had deleted the tweets and explained that it had been hacked...

 
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Greek Debt Will Not Be Included In Bond-Buying Plan; ECB's Knot Warns QE "Distorts Markets"





DRAGHI PRESENTED QE PLAN TO SCHAEUBLE, MERKEL, SPIEGEL SAYS

Once again the clear preference for holding Swiss Francs over Euros was evident today as EURCHF re-collapsed from over 1.02 to under 0.9750 now. Overnight news from Greece suggesting bank runs are under way was then added to as Bloomberg reports, Greece is set to run out of cash by mid-year if it can’t break the deadlock over its rescue program, according to two international officials. Now, in the final "FU" to Greece, following Wolfgang Schaeuble's earlier comments that Greece does not have a debt problem, Der Spiegel reports after the European close that ECB QE will not include Greek bonds due to their low rating... but will see national central banks buying own-country debt.

 
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Goldman Admits It, Too, Was Short The Swiss Franc





"In our portfolios with currencies, we have been short the CHF on the grounds that it was an expensive currency which we expected would experience capital outflows as European growth normalized. We were surprised by the sudden removal of the peg. Although the CHF real effective exchange rate is lower than during the European crisis of 2011, it has actually appreciated in recent months. We exited a substantial portion of our CHF short today and are monitoring the situation closely."

 
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What The Soaring Swiss Franc Means For Hungarian And Polish Mortgages





Spoiler alert: nothing good, because what until yesterday was, indicatively, a 1 million mortgage (in HUF or PLN terms) is suddenly a 1.2 million mortgage. But what about the details? Here they are, courtesy of Goldman Sachs.

 
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Deutsche, Interactive Brokers, Barclays Lost Hundreds Of Millions Due To Swiss Franc Volatility





  • DEUTSCHE BANK LOST ABOUT $150M THURS DUE TO SWISS FRANC VOLATILITY: SOURCE
  • BARCLAYS LOST TENS OF MILLIONS OF DOLLARS THURS: SOURCE
  • INTERACTIVE BROKERS GROUP SAYS "SEVERAL" CUSTOMERS SUFFERED LOSSES IN EXCESS OF THEIR DEPOSIT AMOUNTING TO APPROXIMATELY $120 MILLION, LESS THAN 2.5% OF CO'S NET WORTH
 
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Largest Retail FX Broker Stock Crashes 90% As Swiss Contagion Spreads





UPDATE: Knight Trading 2.0? Jefferies executive are reportedly on-site at FXCM discussing a $200 million bailout

As we first reported last night, FXCM was among the first of many retail FX brokers (and the largest) to see its clients suffer massive losses from yesterday's Swiss Franc surge following the SNB decision to unleash market forces. There are now at least 4 retail FX brokers (FXCM, Excel Markets, OANDA, and Alpari) who have announced "issues" but FXCM, being among the largest and publicly traded is the most transparent example of wjust what can go wrong when average joes are allowed 100:1 leverage. FXCM is now stuck chasing clients for money they do not (and will never) have.. and its stock is down 90%, trading a $2 this morning (down from $17 on Wednesday). As Credit Suisse notes, time is running out as regulators "tend to be impatient once capital requirements are breached."

 
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The Greek Bank Runs Have Begun: Two Greek Banks Request Emergency Liquidity Assistance





The bad news is that as we also speculated, and as Greek officials tried to cover up as usual, the Greeks have resumed doing what they do best any time their country is facing a grand crisis: walking to the bank and withdrawing what little deposits they have left. Or rather running to the bank. Which brings us back to the topic of the Emergency Liquidity Assistnace, which as Kathimerini reported moments ago, at least two Greek systemic banks have reportedly resorted to, indicating that the liquidity situation in Greece is once again as dire as it was in the depth of the European collapse.

 
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