It was just a matter of time before the sensible banks (read, not some fossilized dinosaur out of Japan who apparently does not realize what a strong Yen means for his country's trade surplus) told Bernanke: "basta." The latest on the currency intervention front comes courtesy of Switzerland, where the Swiss National Bank has again sold a boatload of CHFs to prevent the United States from being the only country hell bent on destroying its own national currency.
The Swiss franc declined against the euro amid speculation the central bank sold the currency to curb its advance.
The franc slid 0.5 percent to 1.5189 per euro as of 1:34 p.m. in Zurich, and fell as much as 0.6 percent earlier, the most since July 23.
“There is a very strong suspicion that they are intervening via a Swiss supra-national,” said Sebastien Galy, a senior currency strategist at BNP Paribas SA in New York.
The net result: a very strategic detour for Bernanke, who has somehow convinced his BOE and ECB counterparts that rising stock markets are much more important than trade and interest rates.
So the question becomes: once the global market hits its artificial high, driven exclusively by the ongoing devaluation of just one currency (the $US in case you were wondering), which has been the primary, and maybe sole, reason for global equity markets being where they are, and countries are forced to trade with each other once again, how fast will the dash for the currency devaluation bottom materialize? Be short the dollar at your own risk at that point.