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Latest SNB Intervention Half Life - One Hour 15 Minutes

Tyler Durden's picture




 

As expected, after the USDCHF and EURCHF has been reaching new all time lows again and again, day after day, the SNB, a week after its latest doomed intervention, intervened again, by doing more of the same, this time increasing banks’ sight deposits at the SNB from currently CHF 80 billion to CHF 120 billion. End result: a 150 pip spike... which was fully retraced in one hour. The trend is unmissable - every single intervention (that of the Fed included) has progressively little impact as these desperate measures, traditionally reserved for life or death situations, and which are supposed to bring the element of surprise with them, are now not only not surprising, but demanded every single day, and if absent, cause asset sell offs. Pretty soon the battlefield will be central planners vs HFTs, with the money printers issuing money at first on a monthly, then weekly, daily, hourly, then lastly millisecond-ly, and ultimately constant basis, at which point it will truly be too late to buy gold.

USDCHF post overnight intervention:

And full text of the latest SNB "intervention":

Swiss National Bank expands measures against strong Swiss franc

 

The substantial rise in risk aversion on the international financial markets has further intensified the overvaluation of the Swiss franc in the last few days. In the light of these developments, the Swiss National Bank (SNB) is taking additional measures against the strength of the Swiss franc. It will again significantly increase the supply of liquidity to the Swiss franc money market. The SNB aims to rapidly expand banks’ sight deposits at the SNB from currently CHF 80 billion to CHF 120 billion.

 

To accelerate the increase in Swiss franc liquidity, the SNB will additionally conduct foreign exchange swap transactions. The foreign exchange swap is a monetary policy instrument which the SNB uses to create Swiss franc liquidity. It was last employed in autumn 2008.

 

The massive overvaluation of the Swiss franc poses a threat to the development of the economy in Switzerland and has further increased the downside risks to price stability. The SNB is keeping a close watch on developments on the foreign exchange market and on financial markets. If necessary, it will take further measures against the strength of the Swiss franc.

 

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Wed, 08/10/2011 - 06:58 | 1545488 cossack55
cossack55's picture

Are the Swiss leasing time on our printing presses?

 

Overprinting Bitchezzzzz!!!!!!

Wed, 08/10/2011 - 06:58 | 1545490 Josephine29
Josephine29's picture

Yes I think that it is showing desperation really and as the article highlighted below shows the pain from all this extends through Eastern Europe.

The pain caused by the Swiss Franc to Eastern Europe must be getting unbearable now

http://t.co/UR2ett1

All those mortgage holders in Poland and Hungary in particular must be really suffering as both their mortgages and their monthly repayments mount.

Wed, 08/10/2011 - 07:00 | 1545492 cossack55
cossack55's picture

They should never have believed that whole "American Dream" bullshit.  Maybe BaC can spin off CountryWide to Poland.

Wed, 08/10/2011 - 07:05 | 1545496 TheFourthStooge-ing
TheFourthStooge-ing's picture

Objects circling the bowl tend to move faster as they approach the drain.

 

Wed, 08/10/2011 - 07:08 | 1545500 oobrien
oobrien's picture

Futck 'em all.

They're never right.

But Gerald Celente is usually right.

Here's his latest:

http://www.geraldcelente.proboards.com/index.cgi?board=general&action=display&thread=1633

Wed, 08/10/2011 - 07:10 | 1545504 johngaltfla
johngaltfla's picture

The larger issue is that nobody in the world wants to use the dollar or the Euro as their reserve so the Swiss Franc, Yen (for whatever reason), and Gold have become the ultimate replacement. Unless the Swiss decide to go Weimar, there is not enough intervention in the world available for the fiat currency freakazoids to prevent the CHF from hitting 0.50.

Wed, 08/10/2011 - 08:10 | 1545636 margaris
margaris's picture

Yes, this number 0.50 keeps popping up for about a year now. I believe Hildebrandt himself pulled the number out of his ass to scare the Bund.

I think the swiss piggy bank will explode long before that 0.5 is approached...

When switzerland explodes a cloud of overvalued chf-notes will rain down over whole europe and merge with the worthless euro-notes and create something new...

Wed, 08/10/2011 - 07:16 | 1545509 Gooseone
Gooseone's picture

Is it me or is this all going exactly like planned ?

Europe forced to inflate their money supply , Japan ...Switzerland

Now all is needed to force China do take action en maybe the UK some more and all fiat is dilluted and the debt problem is on the plate of the middle class.

 

So how should one interpretate the S&P downgrade after the Fed also made sure yesterday treasuries are on extra discount ?

Besides easing is this not just another way of hammering down the dollar ?

Wed, 08/10/2011 - 07:23 | 1545523 Quintus
Quintus's picture

The Swiss are learning a hard lesson.  That lesson is 'Do not act responsibly.  Do not build up a sound economic position.  Do not refuse to overborrow and blow the money on unproductive indulgence'.  If you do, the mass of broke, spendthrift zombies will try to drag you into the Abyss with them anyway.

This lesson also applies to Germany. who did the right thing but are now being dragged down by their spendaholic neighbours.

Any private individual who had the temerity to live sensibly, save some money and provide for themselves is similarly being raped by effectively zero interest rates on their savings.  

All in the name of 'Saving' those who fucked up.

 

Wed, 08/10/2011 - 09:51 | 1545986 Hedgetard55
Hedgetard55's picture

+55

 

Uncle Ben has stolen three years of interest income from me and given it to his bankster buddies, the ones who created the mess in the first place. Hopefully Ben will someday get what is coming to him - an orange jumpsuit and a celly named Bubba for life.

Wed, 08/10/2011 - 07:22 | 1545525 æther
æther's picture

Three words: Diminishing marginal return.

Wed, 08/10/2011 - 07:27 | 1545538 Dr. Engali
Dr. Engali's picture

Our printing presses are faster than yours. Nanny nanny boo boo.

Wed, 08/10/2011 - 07:47 | 1545578 mantrid
mantrid's picture

I don't think they're that dumb to waste ammo for nothing... if they were dumb, they wouldn't manage to set up this safe-haven. I wonder, what transactions occured in that timeframe, whom was that supposed to help...

Wed, 08/10/2011 - 07:56 | 1545600 THE DORK OF CORK
THE DORK OF CORK's picture

Massive central bank buying of Gold coming to a cinema near you.

Wed, 08/10/2011 - 08:09 | 1545631 Urban Redneck
Urban Redneck's picture

The SNB is running out things to lose- they should set up an off-balance sheet SIV and start sucking gold off the open market to intentionally drive the gold price up to a level which reflects the monetization efforts of the reserve CBs (FED & ECB), which might motivate their worthless asses to supply CHF to their domestic markets through basically a naked short transaction (and in the process assume some of the burden for the mess their printing presses have created)...  Time to get back to my European August... 

Wed, 08/10/2011 - 08:33 | 1545682 THE DORK OF CORK
THE DORK OF CORK's picture

Whatever mechanism they use they should reduce the leverage of the fiat fx market which is doing great damage to the physical economies of the world.

Wed, 08/10/2011 - 08:00 | 1545610 slackrabbit
slackrabbit's picture

The cap'n says Lets pray they keep o'printin Lads

while we hoard our gold.

Time comes that booty will be all ours, and the bankers be our bitches

 

Wed, 08/10/2011 - 08:01 | 1545614 chinaguy
chinaguy's picture

Quote from Gerry Davies Re the CHF trade this AM:

The cross action went something like this.  Went up early amid mutterings of SNB intervention (never confirmed) Then it crapped out as reports came in that North Korea had taken pot shots at South Korean island. No sooner had we slumped to session low than we hurtled back to session high as news came in that the SNB had expanded measures against the strong franc. We then drifted lower as the market questioned whether the SNB measures are going to be enough.

Wed, 08/10/2011 - 09:51 | 1545984 eurusdog
eurusdog's picture

I am telling you now, it won't be long before they downgrade GDP outlook to negative and report on a few banks possible failures, and that they are running a huge deficit, or some other manufactured Swiss crisis.

Wed, 08/10/2011 - 10:04 | 1546074 Grand Supercycle
Grand Supercycle's picture

The parabolic USDCHF is so oversold a corrective crash (up) is possible.


http://stockmarket618.wordpress.com

Thu, 08/11/2011 - 00:12 | 1549827 Ye Ye
Ye Ye's picture

Sorry to be naive, but ... can't the Swiss just say "I'll print you as many CHF as you want for $1.30 each."  How come they don't do that?  (Same question for BOJ, "we'll print 1000 yen for $12.50" ...)

Wed, 09/14/2011 - 05:27 | 1667624 chinawholesaler
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