Silverfinger Posted January 15, 2015 Share Posted January 15, 2015 The SNB also elected to push its key interest rate deeper into negative territory, lowering this from -0.25pc to -0.75pc, in order “to ensure that the discontinuation of the minimum exchange rate does not lead to an inappropriate tightening of monetary conditions”. http://www.telegraph.co.uk/finance/currency/11347218/Swiss-franc-surges-after-scrapping-euro-peg.html So, let's see: I pay in CHF 100,000, and a year later the SNB gives CHF 99,250 back to me. They are draining money supply, because CHF that the SNB keeps simply evaporate in a reduction of their balance sheet. To achieve inflation, they apply deflation. Very interesting! Quote Link to comment Share on other sites More sharing options...
Killer Bunny Posted January 15, 2015 Author Share Posted January 15, 2015 (edited) SSMI down 9% Does the angle of descent remind you of any other descent...? Edited January 15, 2015 by Killer Bunny Quote Link to comment Share on other sites More sharing options...
onlyme2 Posted January 15, 2015 Share Posted January 15, 2015 http://www.telegraph.co.uk/finance/currency/11347218/Swiss-franc-surges-after-scrapping-euro-peg.html So, let's see: I pay in CHF 100,000, and a year later the SNB gives CHF 99,250 back to me. They are draining money supply, because CHF that the SNB keeps simply evaporate in a reduction of their balance sheet. To achieve inflation, they apply deflation. Very interesting! They are trying to sterlise CHF gains due to unpegging by making it less attractive holding CHF. They can't stop the CHF getting drunk, just don't want it pissed. Better than spending an unknown sum trying to keep a peg in place. Quote Link to comment Share on other sites More sharing options...
Sancho Panza Posted January 15, 2015 Share Posted January 15, 2015 http://www.telegraph.co.uk/finance/currency/11347218/Swiss-franc-surges-after-scrapping-euro-peg.html So, let's see: I pay in CHF 100,000, and a year later the SNB gives CHF 99,250 back to me. They are draining money supply, because CHF that the SNB keeps simply evaporate in a reduction of their balance sheet. To achieve inflation, they apply deflation. Very interesting! The more they try and increase velocity,the lower it goes. Quote Link to comment Share on other sites More sharing options...
R K Posted January 15, 2015 Share Posted January 15, 2015 Thats not volatility....... This is volatility! Jamie McGeever @ReutersJamie 1h1 hour ago Euro/Swiss. My, my, my (or yours, yours, yours): Quote Link to comment Share on other sites More sharing options...
R K Posted January 15, 2015 Share Posted January 15, 2015 Mark Barton @markbartontv 32m32 minutes ago The #Swiss Market Index Index drop is the biggest since October 1989: $114 BILLION of value has vanished... Quote Link to comment Share on other sites More sharing options...
R K Posted January 15, 2015 Share Posted January 15, 2015 Graeme Wearden @graemewearden 6m6 minutes ago Shares in Swiss exporters tumble after franc ceiling scrapped. Swatch CEO fears 'tsunami': http://www.theguardian.com/business/live/2015/jan/15/stock-markets-and-copper-price-wef-global-risks-live?view=desktop#block-54b79cc1e4b0d93c639176ca … Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted January 15, 2015 Share Posted January 15, 2015 SSMI down 9% Does the angle of descent remind you of any other descent...? El Capitan on a clear Spring morning? No, can you give us a clue? Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted January 15, 2015 Share Posted January 15, 2015 Mark Barton @markbartontv 32m32 minutes ago The #Swiss Market Index Index drop is the biggest since October 1989: $114 BILLION of value has vanished... How can 114 billion USD just vanish? Did someone check the cuckoo clock? Quote Link to comment Share on other sites More sharing options...
Quicken Posted January 15, 2015 Share Posted January 15, 2015 Quote Link to comment Share on other sites More sharing options...
weaker Posted January 15, 2015 Share Posted January 15, 2015 (edited) Graeme Wearden @graemewearden 6m6 minutes ago Shares in Swiss exporters tumble after franc ceiling scrapped. Swatch CEO fears 'tsunami': http://www.theguardian.com/business/live/2015/jan/15/stock-markets-and-copper-price-wef-global-risks-live?view=desktop#block-54b79cc1e4b0d93c639176ca … Surely just Swiss mulinationals earning capacity being revalued in terms of the rest-of-the-world currency basket; about 15% less in CHF than yesterday. I'm more worried about the SNB's balance sheet, which they have been furiously buying EUR and selling CHF to keep the peg: (and all those mortgages in CHF taken out in Hungary, and the rest of eastern europe....) Edited January 15, 2015 by weaker Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted January 15, 2015 Share Posted January 15, 2015 What does this actually mean... in numpty terms for those who don't understand it... Gold is up and apparently lots of hedge funds are about to go bust... but what are the implications of this for stuff that affects people's lives? Quote Link to comment Share on other sites More sharing options...
weaker Posted January 15, 2015 Share Posted January 15, 2015 What does this actually mean... in numpty terms for those who don't understand it... Gold is up and apparently lots of hedge funds are about to go bust... but what are the implications of this for stuff that affects people's lives? The swiss currency just got 15% more valuable. People relying on the peg at EUR1.20 just got slaughtered (Hungarian mortgagors, hegies). The Swiss national bank just lost 15% on it's EUR holdings. All Swiss companies are being priced in a currency which is 15% more valuable than it was yesterday; hence stock market falls. Anything else? Quote Link to comment Share on other sites More sharing options...
onlyme2 Posted January 15, 2015 Share Posted January 15, 2015 (edited) The swiss currency just got 15% more valuable. People relying on the peg at EUR1.20 just got slaughtered (Hungarian mortgagors, hegies). The Swiss national bank just lost 15% on it's EUR holdings. All Swiss companies are being priced in a currency which is 15% more valuable than it was yesterday; hence stock market falls. Anything else? Could unhinge the EUR and set that rolling downhill. CHF peg is effecively EUR support. Edited January 15, 2015 by onlyme2 Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted January 15, 2015 Share Posted January 15, 2015 The swiss currency just got 15% more valuable. People relying on the peg at EUR1.20 just got slaughtered (Hungarian mortgagors, hegies). The Swiss national bank just lost 15% on it's EUR holdings. All Swiss companies are being priced in a currency which is 15% more valuable than it was yesterday; hence stock market falls. Anything else? Could it crash the stock markets. Gold seems to be going up. Quote Link to comment Share on other sites More sharing options...
R K Posted January 15, 2015 Share Posted January 15, 2015 Now that Swiss have effectively just left the euro zone it makes a german exit look a little less unlikely. Quote Link to comment Share on other sites More sharing options...
Patfig Posted January 15, 2015 Share Posted January 15, 2015 Bloody hell I was there a few months ago and in Berne a Mc Donalds was about £11 equivalent, wonder how much it will be today Quote Link to comment Share on other sites More sharing options...
Quicken Posted January 15, 2015 Share Posted January 15, 2015 (edited) The swiss currency just got 15% more valuable. People relying on the peg at EUR1.20 just got slaughtered (Hungarian mortgagors, hegies). The Swiss national bank just lost 15% on it's EUR holdings. All Swiss companies are being priced in a currency which is 15% more valuable than it was yesterday; hence stock market falls. Anything else? The hundreds of thousands of cross border workers in Switzerland just got a big pay rise. That isn't going to please some native Swiss. Edited January 15, 2015 by Quicken Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted January 15, 2015 Share Posted January 15, 2015 Bloody hell I was there a few months ago and in Berne a Mc Donalds was about £11 equivalent, wonder how much it will be today I see you have your priorities right. Quote Link to comment Share on other sites More sharing options...
onlyme2 Posted January 15, 2015 Share Posted January 15, 2015 Now that Swiss have effectively just left the euro zone it makes a german exit look a little less unlikely. Was thinking along the lines of exit may be for more politically significant than just the peg, they may decide they want to stay as independent as possible rather than a slow merge with EU,heck migration adn terrorism could even come into the mix and the ability to run their own policies in those regards. Why do you say a German exit less likely? Quote Link to comment Share on other sites More sharing options...
Patfig Posted January 15, 2015 Share Posted January 15, 2015 Well you wanted it in laymans terms Tulip old bean Quote Link to comment Share on other sites More sharing options...
Quicken Posted January 15, 2015 Share Posted January 15, 2015 Was thinking along the lines of exit may be for more politically significant than just the peg, they may decide they want to stay as independent as possible rather than a slow merge with EU,heck migration adn terrorism could even come into the mix and the ability to run their own policies in those regards. Why do you say a German exit less likely? RK said less unlikely = more likely. Quote Link to comment Share on other sites More sharing options...
onlyme2 Posted January 15, 2015 Share Posted January 15, 2015 EUR/GDP chart inteersting here - big void with no major support levels all the way back to 0.70 area. http://www.xe.com/currencycharts/?from=EUR&to=GBP&view=10Y Quote Link to comment Share on other sites More sharing options...
Venger Posted January 15, 2015 Share Posted January 15, 2015 The swiss currency just got 15% more valuable. People relying on the peg at EUR1.20 just got slaughtered (Hungarian mortgagors, hegies). The Swiss national bank just lost 15% on it's EUR holdings. All Swiss companies are being priced in a currency which is 15% more valuable than it was yesterday; hence stock market falls. Anything else? So those sitting on dead money savings not chasing yield, accepting 0% or even -negative for Switzerland, just got a nice pay day. Can hope it comes here, vs house prices. One of my bosses (old guy) when I was Summer job working at the Highways Agency (he was on the local council side) in 1996 told me his family savings, in Swiss banks, had hardened some 800% against the GBP over decades. I can recall looking into it at the time, and there were large gains. He'd just bought his daughter a house for cash. Another time, YHA trip through Europe, Swiss guy was bragging to me how Swiss companies involved in everything, especially in the arms/weapons trade. Quote Link to comment Share on other sites More sharing options...
onlyme2 Posted January 15, 2015 Share Posted January 15, 2015 (edited) RK said less unlikely = more likely. OOPs, yes sorry RK misread, and/or Grexit being next event or big devaluation through QE. Edited January 15, 2015 by onlyme2 Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.