Switzerland

Richard Koo: If Helicopter Money Succeeds, It Will Lead To 1,500% Inflation

"if businesses and households were to resume borrowing in earnest, the US money supply could balloon to 15 times its current size, sending inflation as high as 1,500%. The corresponding ratios are 28 times for Japan and Switzerland, five times for the eurozone, and 11 times for the UK. Once private-sector demand for loans recovers in these countries, confidence in the dollar, euro, and yen will plummet."

Global Stocks, Futures Continue Rise On Apple, Japan Stimulus; Yellen On Deck

The markets were following a rollercoaster night for the Japanese Yen, when after several media headlines Abe was said to have announced a stimulus package that would be more than JPY28 trillion, sending Japanese stocks higher 1.7% while the USDJPY spiked but well off overnight highs, pushing risk assets higher. Europe and US futs were also in the green on optimism from AAPL's earnings, but all eyes will be on today's FOMC announcement.

"An Extraordinary Development": Record Swiss Gold Flow Into The United States

There was a huge trend change in U.S. gold investment in May.  Something quite extraordinary took place which hasn’t happened for several decades.  While Switzerland has been a major source of U.S. gold exports for many years, the tables turned in May as the Swiss exported a record amount of gold to the United States.

"If You Can't Touch It, You Don't Own It"

The pending Brexit has, not surprisingly, caused a shakeup in the investment world, particularly in the UK. Of particular note is that, recently, asset management firms in Britain began refusing their clients the right to cash out of their mutual funds. Of the £35 billion invested in such funds, just under £20 billion has been affected. The lesson to take away here is that, if you can’t touch it, you don’t own it. Banks and fund management firms can freeze your wealth, so that you can’t access it. Governments and banks can confiscate your wealth. If you don’t have the power to put your hands on your wealth on demand, you don’t own it.

"The World's Central Banks Are Making A Big Mistake"

Debt is future consumption brought forward. Once debt is incurred, consumption that might have happened in the future won’t happen. And it should come as no surprise that at a certain debt level, growth and income begin to diminish. That is exactly what we are seeing in the real world.

Hans-Hermann Hoppe: "Put Your Hope In Radical Decentralization"

"The EU is the first step on the way toward the creation of a European Super-State, and ultimately of a one-world government, dominated by the USA and its central bank, the FED... Don’t put your trust in democracy, but neither should you trust in a dictatorship. Rather, put your hope into radical political decentralization, not just in India and China, but everywhere."

"It's Prohibited By Law" - A Problem Emerges For Japan's "Helicopter Money" Plans

"Adopting helicopter money in the strict sense is impossible as it's prohibited by law," said one of the officials. "If it's about the BOJ buying huge amounts of bonds and the government deploying fiscal stimulus, we're already doing that." Japan shouldn't make its central bank directly underwrite government borrowing, "or it could suffer the kind of runaway spending and inflation that followed a similar move in the 1930s."

Germany Sells First Ever Negative-Yielding 10Y Treasury, Corporate Bonds

Just hours prior to Germany selling its first ever negative-yield 10Y bund, German railway operator Deutsche Bahn became the first non-financial company to sell a corporate bond with a negative yield in euros on Tuesday. . Joint leads BayernLB and Raiffeisen Bank set the final spread at plus 15bp as orders reached 840m. The deal priced with a negative 0.006% yield and a 0% coupon.

Japanese Savers Flood Into Gold Fearing The Endgame Is Close

"For investors, buying gold is similar to casting a no-confidence vote," saidItsuo Toshima, 68, an investment adviser and former regional manager for the World Gold Council in Tokyo. "Gold is the unprintable currency, unlike the yen. The yen’s appreciation in spite of the adoption of the negative-rate policy has kindled skepticism about the policy’s benefits. It’s also led to investors seeking to protect their assets in case Abenomics fails.”

"The World Is Walking From Crisis To Crisis" - Why BofA Sees $1,500 Gold And $30 Silver

The world has been walking from crisis to crisis and we see risks that this may not change. The importance of that dynamic for the precious metals is mirrored by the high correlation between potential US GDP growth and gold quotations. Interest  rates globally are set to remain low, which in turn reduces the opportunity costs of holding a non-yielding asset like gold. We believe gold prices could rise to $1,500/oz near-term. We called a bottom in silver in April on supply and demand dynamics; an overshoot of prices to $30/oz is possible.