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The Swiss Central Bank Conundrum: Fighting Fire with Kerosene

2014-05-11 2 comments

When the Swiss Franc started appreciating against the Euro (or was it the Euro depreciating against the CHF?) the Swiss National Bank vowed to fight tooth and nail to keep the Swiss Franc at a 1.20 parity “at all cost”.

Time to wonder how such a “fight” is fought, whether it can be successful and what are the consequences.

The currency “stabilisation” choices a central bank has

A central bank is the master of its own currency, i.e. the currency it is meant to issue.

In today’s world of unbacked (“fiat”) currencies even the Swiss Central Bank has no real restriction as to how many units of its currency it can create. It can virtually create infinitesimal amounts of it. Read more…

The End Game or: How the Dupes were Duped or: The Euro Ten Years on

2011-12-10 1 comment

The Euro was probably the most hyped-in currency the world may have ever known.

That fact alone should have been reason for suspicion.

In this article we contrast some of the eulogies heaped on the Euro back in around 2001/2002 when it was introduced as a tangible currency with these past weeks’ near-obituaries.

Read more…

Updated Statistical, Economic and Historical References

2011-08-16 4 comments

We have updated our References section and, for the first time, also published our References ordered by Subjects – probably the most comprehensive trove on Statistical, Economic, Monetary and Historical Data etc. … Read more…

Economic Musings X: Legal Tender – Legal or Tender or What?

2010-04-16 9 comments

After World War II when the German Reichsmark was discredited and people were starving they would travel from their city to the local farms … Read more…

Bloom of Doom VIII: US Figures Stronger than Feared

If you think the title is a contradiction, well, not more so than the idea that debt or subsidies could increase wealth. Where truth can’t win by argument it needs to do so by stealth (that almost rhymes). The President of the United States has published a report on the state of the economy which proves how uneconomical the state has become. From that report you can glean two things, the bad and the ugly: the US economy has greatly deteriorated further and it seems beyond the point of no return.
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Economic Musings IX: We could all be millionaires …

2010-04-10 3 comments

… if we hadn’t destroyed literally trillions over the last 200 years!

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Bloom of Doom VII: The Borrower of last Resort

Not so very long ago the idea had firmly taken root that the Fed was the “lender of the last resort”, meaning that if no one else would lend to banks, the Fed would, thus preventing bank runs. Now it always struck CrisisMaven as odd that banks under any circumstance should be so little creditworthy that they couldn’t get credit. After all, aren’t banks the “eponym” of creditworthy, so to speak? But that the Fed one day would need to borrow from these banks no one else would lend to is an irony of fate we need to chew on a little to fathom all its dire implications.

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