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Swiss Depositors Confused By Concept Of NIRP As Swiss Deposits Jump Most In 18 Months
This wasn't supposed to happen. The Swiss National Bank has a problem - having announced on Dec 18th that it will impose negative deposit rates starting Jan 22nd, sight deposits soared (as opposed to the textbook expectations). Sight deposits (cash-like deposits commercial banks hold with the central bank) rose CHF10.8 billion this week (or 3.4%) - the most in over 18 months.
Looks like we are going to need moar negative-er rates...
Chart: Bloomberg
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Uh yeah, 'cause it's not Jan 22nd yet.
Because there is nothing like front running a rate cut to get that whole 0.15% "return" on your money for one month.
You lost that much on your drive to the bank
the swiss appear to be gluttons for punishment. at this rate they will certainly get theirs.
Why would big business throw a lot of money into accounts with negative interest rates?
Because they know that returns everywhere else will be far less.
Somebody knows something and that somebody isn't me.
or that 'everywhere else' will have a problem returning their money back...
Cash*, Bonds, Gold.
[*Note: "Cash" does not include bank deposits.]
Yep, it would appear that the physical version of everything is more valuable than the paper version.
When it comes to "Cash" I prefer the paper version...
[as opposed to the fictitious 'electronic' version, or mere numbers on a monthly statement. Worked better for citizens of Cyprus...]
"If you don't hold it, you don't own it."
In case of Switzerland demand for CHF 1000 bills is exploding. The circulation of these bills went up from CHF 24 billion in 2007 to CHF 38 billion this year. The owners don't have to worry about their banking relationship, the bills are easy to move and leave no trace. Seems attractive enough for many investors.
Cue Bitcoin commenters.......3.......2.......
Gold, cash*, bonds....
There....fixed it for ya.
I have them listed in the order in which I would be willing to liquidate them in the event of a crisis...
thas better
"Return of" rather than "return on" is the key here, I'm guessing.
How long of a bank holiday can you and/or your business withstand?
This should be fun to watch.
think of big business which huge float that they cannot invest-but lease sitting in accounts-not as much as years ago buy sell need to maintaine balances-when the banks go under and bail ins occur--big business should be drawing down cash and put it who knows where--as long as its not in a bank.
governments try to fix or defer one problem and wind up creating 2 new problems.
People are fucking retarded.
More like fucking scared. And retarded, too, I'll grant you that.
Actually, Dr. -- YOU are the one who is retarded.
This ain't mom and dad with a few hundred euro -- of course they can take phys cash or PMs out of the system. This is businesses that have millions and can't afford to be the next unsecured lender that the banks fuck over.
Dealing with cash or PMs is useles to them. They might as well go out of business now if that's the only way to protect your money.
It is strange that the amount of sight deposits went up just as oil began falling.
Doesn't buying EUR create increased sight deposits with comm. banks? Look for next SNB monthly report.
you may want to ask vitol what they know that you don't know:
The Vitol Group is a Swiss-based, Dutch-owned multinational energy and commodity trading company. It was founded in Rotterdam in 1966 by Henk Viëtor and Jacques Detiger,[1][2] and is a private company, with 3,200 employees making up its shareholders. Head offices are located in Rotterdam and Geneva, Switzerland. With 2013 revenues of $307 billion (up from $303 billion in 2012), the company ships more than 270 million tonnes of crude oil per year and is the largest independent energy trader in the world.[4]
other noteworthy facts:
In 1995, Vitol secretly supplied Slobodan Miloševi?'s government with oil.[18] The Observer revealed in 2001 that Vitol paid 1 million pounds to Serbian war criminal Željko Ražnatovi?to settle an oil deal with Miloševi?.[19] Vitol has denied all charges, arguing that no government agency has ever prosecuted the company in this respect.[20]
In 2007, Vitol pleaded guilty to grand larceny in a New York court for paying surcharges to Iraq's national oil company during Saddam's regime and circumventing the UN oil-for-foodprogram. Vitol subsequently paid $17.5 million in restitution for its actions.[21]
Vitol was the company to organise the first controversial sale of Libyan rebel oil to Tesoro Corporation in early April 2011.[22] According to the Financial Times, the company was approached by the Qatari national oil company to sell a cargo of crude oil supplied by the Libyans in exchange for technological supplies and fuel for the National Transitional Council of Libya.[23]
In September 2012, Reuters revealed that the company had bought and sold Iranian fuel oil, bypassing an EU embargo against Teheran. Vitol bought 2 million barrels using a ship-to-ship transfer off the coast of Malaysia from a National Iranian Tanker Company vessel and sold it to Chinese traders. Being based in Switzerland, which did not implement Western sanctions, Vitol skirted the charges.[24]
In 2013, it was revealed that the company had been using for over a decade an Employee Benefit Trust, avoiding paying income tax for its UK staff.[25]
It is Spaniards and Greeks who fear a far more negative rate of interest (confiscation) in their home countries.
Spain is in a world of hurt and can't figure out anyway to get out from under their disaster. The Greeks however gave us Thermopylae and are willing to do it agaian.
Ahh I wish it were true, but it's not. That culture is long gone. Greece is old, literally, they have had few children. The motivated children, the 300, have left the building.
The empire is long gone but the people are still there and they have a long memory. That's one of the problems with Iran, they want to bring back the Persian empire, under theocratic control of course.
New 52 week low USO...
WTI setup is clear as day
https://www.tradingview.com/x/uvgPwb8c/
what set up--who wants to trade the manipulation and globally weak economies.
Is this what happens before they "save us" with one world currency?
They are going to try anyway.....
Until they eliminate precious metals, there will never be one world currency.
PM have always been the 'one world currency'...
It's almost like they're acting crazy just to make a point.
"Discouraging saving by taxing it? Well then I'll just save harder, mom!"
Anyone that tries closing the gate must not be surprised if the people that know rush in.
Hell, anyone can provide banking services offering negative interest rates.
Give me $1,000 today, and I will give you $950 next year.
I should start issuing negative interest rate coupon bonds.
Either loss minimization in financial repression is occurring, or people want nominally free checking/savings while they still have it (and locking that in if that's even possible anywhere).
Either way, someone is frontrunning.
Most people, probably Thomas Jordan included, think that Hildebrand's folly (the peg) is what stopped the CHF-EUR explosion. What really happened is that Hildebrand's Swiss frank drunken sailer spending spree gave Draghi the time and leverage he needed for his temporory bail outs of Greece, Spain, Portugal. Also bailouted out by SNB's bailout of the EUR were those Austrian and Hungarian banks that had made low interest CHF home loans in "New" europe and the major Swiss banks.
But Draghi, like Bernanke and Yellen, is there to maintain the status quo and he has no interest in any real improvement. So nothing has been fixed in Europe, or the US. The EU is financially leaking badly, while Switzerland is still solvent.
The peg is going to break, and currency speculators both big and small smell blood.
Afterwards, once again, the AngloZionist will find some special punishment to be meted out to Switzerland
Maybe they'll be able to deduct the -% on deposits from their taxes?
They are just going to make it up, in volume.
Hopefully Blumberg will do a follow up piece once everyone gets their January statements.
Hey Swissy, wish now that gold referendum had passed?
exactly.
fucking morons...
Hmmm... These days, one should be more interested in return of principal as opposed to return on principal. ;-)
That is until Hyperinflation kicks in; then, who gives a $hit. Pass the stack so I can wipe my @ss. ;-)
Quantum Financial Dynamic Model vs Newtonian Financial Model.
The Bank of England is using Facebook and Twitter to help set interest rates
http://www.engadget.com/2014/12/29/bank-of-england-social-economy/
The Bank of England is still paying off debt from the 1720s South Sea Bubble: http://www.nytimes.com/2014/12/28/world/that-debt-from-1720-britains-pay...
That they use Twitter to set interest rates does not surprise me in the least.
Flight to "safety"...
no really, losing a few percent is better than losing it all...
/s
If you can't physically touch and defend "it", you don't own whatever it is...
Of course the Swiss are rather well armed. This could get interesting.
You must be brain dead too. How does phys protect a business with millions of euro and a need for liquidity?
This is not mom and pop with tiny accounts. Obviously, they can get out of the system. Even though bail ins won't affect them at all.
Stick to physics, if you even know anything about that... doubtful since this is so obvious.
i wouldn't say there is any correlation on small moves. over the period shown on the chart, i doubt many depositors were moving funds in and out of deposits based on 10bp swings. even at a negative 35bps....what is that on the average account size? probably not even the cost of one overdraft fee. I think we get in the trap of measuring things so infinitesimally it loses its meaning.
-0.35%? were people complaining in 1982 when they were getting screwed by -8.0%? yes some were, but the vast majority of people had no idea the bank was giving you 8% interest on your deposits, while they kept it in fed funds at 16%. now that was a royal screwing....not that there was any other way for the banking system to survive.
Bankers actually went to jail back then.
Today, these same fuckers get the money for 0.25% and let it sit in treasuries with 10x the yeild.
The "royal screwing" continues, this time risk free with the taxpayer firmly on the hook for backstopping everything.
So they'd rather have bank deposits than paper stuffed in the mattress? Go figure.
I'm studying Jane Austin novels because that's what the government pays me to do. I'd rather be a member of a swat team going after criminal banksters but the government won't pay me to do that. If I did get paid to do that once I captured them I would make them read Jane Austin novels until they confessed.
I guess that beats coal mining.
q99x2 ... look into being a Fireman:
If you haven't already heard: an assistant fire chief in Southern California collected a $983,319 pension last year, and a Los Angeles police captain took home nearly $753,861.
http://news.investors.com/ibd-editorials-viewpoint/122614-732234-public-...
But was it worth all of those they had to kill to get it?
Double post....
I see what you did there...
The mutual fund industry has been getting away with it for years.
It's not that confusing. The stronger sovereign currencies like the dollar and the Swiss Franc will be seen as the safest havens available when the deflationary forces begin to reign. The dollar will be particularly sought after because most of the world's debt is denominated in dollars'
http://www.globaldeflationnews.com/u-s-dollar-indexelliott-wave-update-f...
I thought yesterday that the less I know, the more I understand, but now I know even more than I do today, and understand even less than I do tomorrow.
Time for a cookie.
Don't get back their physical gold
And deposit all their fake eggs in one faux basket
Sounds like a plan that's bound to succeed
If you're the ones robbing them of everything
Term deposits are not just about the interest rate, an understanding that the swiss franc could be lot higher by the time your term deposit matures may be the driving force behind the inflow.
Just musing...
do they have a true deposit guarantee, not like the fdic, just a number in a govt. statisic?