Let us play a quick game here. I will ask one question and you will brainstorm the first thing that pops to mind. Think of it as a version of the old game show classic Family Feud. In case you have forgotten the rules of Family Feud do not worry. We asked 100 people, in our case we may extend that to 100,000 people the following question and you try to find the five most common answers. Are you ready? It does not really matter. Here is the question: Which country do you first think of when you hear Eurozone debt contagion? Greece...
The Swiss National Bank enjoys the rare situation of a good problem to have. Four months after the SNB decided to cap the Swiss Franc and thanks to the Eurozone Debt Contagion its currency holdings skyrocketed by 50% and hit 365 billion Francs in June. SNB President Thomas Jordan now faces the difficult task of where and how to invest the excessive cash pile. The SNB decided to cap the EURCHF at 1.20 and has been hording Euros in order to defend the ceiling they set. The SNB usually invests foreign currencies in AAA rated bonds of...
Another weekend passed, another Eurozone crisis summit passed with it. There is a growing divide as on how to handle this Greek tragedy. You have Germany on one side which fights to maintain the current Euro structure which hurts Germany more than any other Eurozone member. Austria has voiced that Greece should get an additional two to three years and taken the opposite stance of the German camp which is against any delays, quelle surprise, while the Netherlands claimed that they would block any additional assistance to Greece such as a...
The Bank of Japan could not stand to be left out of central bank idiocy and decided to join the demolition duo comprised of the ECB and U.S. Fed. The BoJ announced that it will waste an additional 10 Trillion Yen on its so called asset purchasing fund. It is quite amusing to see another central bank that is incapable when it comes to the identification of assets. The most basic definition of an asset is something that puts money into your pocket. This definition is simplified to pre-school difficulty. This means even a five year old would...
This week may very well record the highs for the year as far as major global benchmarks are concerned. Equity markets have enjoyed this artificially induced rally, especially after central banks from Frankfurt to New York to Tokyo have acted in such an idiotic manner which allowed dumb money investors to keep pushing the markets to multi-year highs. Does this sound familiar? Well, it should. I have one word for you, actually it is a number: 2008. During the summer of 2008 investors ignored all the bad news and were in a state of trance...
