Don't go to Switzerland

I don't think what the SNB did this because of what we see happening right now.

They of course were suppressing the value of their currency as are other central banks [or manipulating]. The SNB purchased around half a trillion Euros to keep the franc from appreciating wildly as it did this week.

I think what is about to happen is the Swiss bankers have an inside tip and the ECB is about to have massive QE,. A printfest just like our own Fed has done, partially to keep afloat tbtf fail European banks who's capital ratios are still in trouble since the cdo meltdown of '08.

It would seem the Euro banks are "taking it in the shorts" [pun intended] over 1 Russian sanctions, 2 the cut off of natural gas to Europe do to malfeasance in Ukraine, and the Greek meltdown. All the big banks are trembling about what will be considered a "CDO event" determined by ISDA and start a chain reaction of collateral calls. He who panics first, panics best.

Greece already defaulted which should have been recognized as a cdo default, but the ECB has continued [financed by Germany] loaning Greece money that will never be repayed. The Swiss may have just grown tired of throwing their good money at a bad risk [Greece]?I think the SNB had to isolate themselves from an upcoming trigger event, but will eventually come out ahead on the deal as they will receive tons of scared money, gold etc. and be able to continue with their "neutral" meme. The more things change, the more they stay the same.

That's my wag for the week ahead.

Anyone who wants a good understanding of fiat money would do will to spend a few minutes and read/share this article;http://whatreallyhappened.com/WRHARTICLES/allwarsarebankerwars.php#axzz3P5zMajSY The Swiss supposedly have a lot of physical gold, and this move might have relieved them of the need to provide records to the US IRS? So our crooked politicos and ceo's can restart holding money there again?

Quote: petroglyph

I think what is about to happen is the Swiss bankers have an inside tip and the ECB is about to have massive QE,

I don't think it is such an "inside tip". It is strongly assumed that there will be another QE any week now.

The SNB had 495.1 billion francs’ worth of foreign currency reserves in December, the latest data available. About 45% is in Euros. They lost 60 billion francs in value of foreign resere when they let the exchange rate go.

In December of 2014 the Swiss Bank actually introduced a negative interest rate (charging commercial banks to deposit with the National Bank) in order to maintain the cap at 1.2 euros to the Swiss Franc. The cap was introduced in Sep 2011 the last time the franc threatened to reach parity.

Now that parity has been reached, will the SNB renew buying euros to prevent further appreciation?

NEGATIVE INTEREST RATE

About a month ago following the fallout of the slide in the Russian ruble, introduced negative interest rates on commercial bank deposits forcing commercial banks to pay to deposit their francs with the Swiss National Bank.

On 6 September 2011, when the exchange rate appeared headed for parity with the euro, the SNB capped the appreciation to 1.20 francs to the euro saying "the value of the franc is a threat to the economy", and that it was "prepared to buy foreign currency in unlimited quantities."

Now that parity has been reached will they re-institute their efforts.

Several articles on NIRP as well as ZIRP here;http://www.zerohedge.com/search/apachesolr_search/

Now the speculative money is moving to the Danish crown. The Danish krone is part of the ERM-II mechanism, so its exchange rate is tied to within 2.25% of the euro, so in a sense a move by Denmark is much more significant politically than Switzerland.

Denmark has been part of ERM II for 16 years and is the only country in Europe currently in ERM-II. You are required to stay in ERM-II for a minimum of 2 years, but countries are normally in a hurry to become part of the Euro-Zone.

Greece joined 1 January 2001, one year before the physical euro coins and notes .

Subsequently, the following seven countries also joined the eurozone on 1 January in the mentioned year: Slovenia (2007), Cyprus (2008), Malta (2008), Slovakia (2009), Estonia (2011),[2] Latvia (2014) and Lithuania (2015).

=========
It is customary to refer to the unit of currency as a "crown" in english, but every language spells it slightly different.
Danish krone,
Icelandic króna ,
Swedish krona,
Norwegian krone ,
Czech koruna,
Croatian kuna.

Surprisingly the Swiss Franc weakened today to a little lower than the ceiling that they SNB has been trying to enforce since Sep 2011. I thought it would keep getting stronger. What gives?

Quote: Pacomartin

I don't think it is such an "inside tip". It is strongly assumed that there will be another QE any week now.

The SNB had 495.1 billion francs’ worth of foreign currency reserves in December, the latest data available. About 45% is in Euros. They lost 60 billion francs in value of foreign resere when they let the exchange rate go.

It was costing them around a billion a day worth of Euros to keep the peg, in a year that would be about half their GDP.

http://www.zerohedge.com/blogs/bruce-krasting BK says they announced on a Thursday, so they essentially were "firing for effect".

Why do you think, Paco? Obviously no one wants to lose 50 billion, right? Somebody lost and somebody won, who won?

Quote: petroglyph

Why do you think, Paco? Obviously no one wants to lose 50 billion, right? Somebody lost and somebody won, who won?

I can never figure it all out. I remember when Swedish interest rates went to hundreds of percent in the early 1990's when the Germans were trying to borrow all the money in the world for reunification. Now Swedish interest rate is ZERO%.

I am sure many people made a fortune last week, while others lost a lot. People sitting on a pile of francs could sell the for an amazing profit.

Price of Swiss franc in euros
Jan 19, 2015 0.9909
Jan 18, 2015 0.9910
Jan 17, 2015 1.0017
Jan 16, 2015 1.1256
Jan 15, 2015 1.2009
Jan 14, 2015 1.2009
Jan 13, 2015 1.2009

Do you ever read Martin Armstrong? Interesting guy. I think he served the longest sentence for contempt. lol

http://investmentwatchblog.com/the-economic-collapse-is-coming-no-doubt-martin-armstrong-the-forecaster/

"He’s famous, or infamous, for having predicted the October 1987 Black Monday crash to the very day. He also called the Nikkei stock market collapse in 1989 and the Russian financial collapse in 1998. And he hasn’t lost his touch, outfoxing hedge fund managers by predicting last week’s Swiss National Bank decision to abandon its peg to the Euro."