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Swiss Franc Tumbles On Threats NIRP Coming To Bern Next
We have recently noted the increasing pressure on the Swiss National Bank (SNB) over its peg to the EUR in the midst of a capital flood from Europe. The slow bleed strengthening of CHF against EUR had many concerned the SNB would be forced (by exogenous factors) to adjust the peg. But, this morning, it appears they tried to draw a red line... CHF has plunged after SNB's Mosler said negative interest rates remain an option should its minimum exchange rate (peg) come under threat. So, first NIRP in Europe, then in Japan (as per our overnight discussion), and now the Swiss warning NIRP is coming there next...
As Bloomberg reports,
Negative interest rates remain option for SNB should minimum exchange rate be threatened, says Thomas Moser, an alternate member of SNB policy-setting Governing Board, Wall Street Journal reports.
Says “we’re never shy about it. We always said we would use it if needed”
SNB President Thomas Jordan also said on June 19 that “introduction of negative rates is a possible option:”
It seems the reaction was 3-step 'intervention' - because of course - the SNB needed the market's move to confirm their threat... Sell Gold, Sell JPY, then Sell Swissy...
We have opined on the linkages between Gold, JPY, and the Swiss Franc peg previously...
and the SNB's actions with JPY here...
and Swiss Yields are now negative to 2018...
Charts: Bloomberg
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Let the currency wars begin.....
Continue?
It sure looks like the BIS is selling down gold very near any drop in the Yen. They must fear that Japanese are a hair trigger away from going crazy into the gold market, why else would they dump Billions in futures to paint the gold tape?
If the Swiss referendum agrees to the Gold terms, Switzerland may soon be buying 1500 Tonnes of Gold on the "open market" That might create a problem or two??
Instead of currecy wars, it's more like a syncronized combination of Liars Poker and Pass the Trash.
GOLD (+ Other Commods) Are Being Paper Sold Down, So Everyone Flees To Paper Fiats Giving Them Pumped Up Value, Consequently Nations Can Dump Unlimited Bonds Paying HorseShit Interest...
It's Quiet An Ingenious Fiats Bubble, Butt Like All GOOD-TIMES, It Cannot Last...
PS...
Just Look At Germany... After 2 Years They Can't Get Hardly Any Of THEIR GOLD Back.
WHERE IS THE GERMAN PHYSICAL GOLD?
DOES IT EVEN EXIST ANYMORE?
I gave BuBa a call. The head of PR (Susanne Kreutzer) said the gold repatriation is absolutely in time.
http://www.bundesbank.de/Navigation/DE/Presse/Pressekontakt/pressekontak...
What else is she supposed to say... we'll see... if that has been a lie, the truth is going to hit the gold-market.
What gold?
.
That's a very big IF. Pretty much all of the Swiss PTB, most political parties, the government (Bundesrat), and of course the SNB are against it... I sure hope it will go through, but I don't expect that outcome. Odds are it won't IMO. Also, to get to the 20% gold, that would be 1500 tonnes at current market prices. IF they ever start buying real phyzz in size, it would take much less than that to get the 20% covered...
Tradition?
That too!
Every country needs to price itself lower until they all reach closer to zero, just like the interest rates in most western countries and like Libor of whose demise the obituaries have not yet been written, though it died an unnatural death a few years ago.
With bond rates headed to zero, will some financial stocks be next?, despite Citi and RBS etc staying at historic lows ever since 2008 and despite shrinking, saving costs and removing legal overhangs, their stock prices are still unable to rise.
Currencies are needed for trade, travel and as a representation of each economy, hence they will survive, though the value of money itself has been dropping and inflation is sky rocketing around the world at a time when unemployment is at unprecedented levels.
These billionaires need to think how they are screwing themselves and will be left lonely at the top. Just a couple of hundred billionaires against 7.2bn humans! That will be a tough fight! Subjugation by work and debt slavery is about to end. The billionaires need to simply share their wealth around NOW else in the next few years, humans will snatch it away from them.
USD and EUR needs to become like Venezuelan Bolivar or Zimbabwean Dollar before normalcy returns to this world because the cost of producing any food or clothing or ship or pens or iPhones is so prohibitive in US and EU that it must be brought down dramatically to create employment or the markets will take care of it, if and when Russia and China ban all factories to produce any goods for foreign countries, and then we shall hear a KABOOM!
There are no currency wars. All these moves are central bank cartel coordinated, like a synchronized swimming event.
And notice, like Draghi, he never did anything, he just jawboned the market with words. As long as the insider Hedge Funds help do the heavy lifting for these fucks, the manipulation through words will continue. There is fiat money to be made by some.
wouldn't Japan Europe and the Swiss be better off loading up with Gold rather than selling it?...guess the Chinese and Vlad will take the lot, thank you very much!
The Billions the Swiss have lost defending their currency should have been spent on the shiny stuff
the article is misleading, and so your comment as well. The Swiss National Bank is not defending it's currency. It's defending the floor vs the EUR. By that, it generates "revenue", and increases it's foreign exchange reserves
the shiny stuff? do you really think that any small national or central bank can just go and declare a love story with gold again? this currency war is not yet on the defend your currency and be economical about your foreign exchange reserves phase. Quite the contrary, it's still in the downward "beggar your neighbour" phase
The problem is that no currency can do the "backed by gold thing" in today's climate. Gresham's law would make that disappear in a cocaine heartbeat.
And with everyone on the planet devaluing like madmen, it would be even worse.
pods
in the FED's case, it would be feasible. though it would imply a high... political cost
By their size I somewhat agree, but by the obligations of the largest user of that currency no way in hell. The US gov would default in a heartbeat. And since the US government is the military branch that defends the FED, it would be very bad if they did.
pods
Wouldn't a vampire be better off buying all the crucifixes and hiding them? Probably. But the terror of them leads only to shrieking and irrational combative terror whenever one might be around.
O those wrecked dominos.
All it takes is one sneeze.
Let them fall !
But get your wife to trade it before the announcement
The Swiss Franc, is this the AAA Franc that is still backed by gold or the "other" Swiss Franc?
Neat trick the global banksters pulled the last few years where you want a weak currency instead of s strong one. Up is down, left is right, weak is strong. Gold is ugly.
If everyone goes NIRP, and people stop having money in banks, won't that lead to people asking where banks are getting the funds to make loans?
hahaha
pods
LOL, no, not at all, but it might simply make several people wonder why we need banks at all or why they are not getting paid to take out a loan in the first place.
If interest rates do go negative, real negative, you will look like a fucking genius if you have a few billion in a CD earning 2%.
"winning"
Bring us full circle to say, 1900 or so, where companies actually self-financed.
Enter JPM and the panic of 1907 redux.
pods
Once again it also appears there is another effort being made to shake out the weak hands in the treasury/bond market. Once the central bank (i.e. The Fed) owns everything in the space they can make interest rates want they want forever, period. At least so long as the sheep of the world accept paper script.
Well, so much for the GBPCHF short.
today was cameron visit to scotland, next scottish poll result at 9:30pm uk time
could be spectacular
Dully noted- shooting star candle and I'm back in.
USDCHF short here. They have been threatening NIRP quite a while. This is not new news... just jawboning, IMO. Could be wrong... and I often am. :-)
So should I buy my gold now or wait a few more days?
C) All of the above.
Whoever backs the Gold first .......wins.
So... who wants make me a NIRP loan?
It's for the eCONomy, after all.
Next time I hear someone say that gold earns no interest I am going to slap them right on the ear.
Go Swiss! Fuck the Zio Plutocracy!. Hope in novemeber ECOPOP and SAVE our GOLD initiatives will pass! It would be an historic moment. 2 fists in the neocon ass!
And the Swiss................
Swiss need lower currency to protect timepiece industry from Apples new i-watch.
Those of us who spend tens (or hundreds) of thousands of CHF on a single mechanical timepiece probably aren't in the market for an iCrap bracelet (it's not a watch).
Where's Bruce Krasting?
All the stupid shit I’ve complained about that the SNB was/is doing is starting to really bite them in the ass.