| Subject: | Someone Took My Advice On Selling Swissie (CHF) and Buying Dollars (USD) |
|---|---|
| Date: | Thu, 5 Jan 2012 06:28:12 -0800 |
| From: | Jas Jain |
Someone Took My Advice On Selling Swissie (CHF) and Buying Dollars (USD)
That someone is the wife of the head of Swiss National Bank (SNB), Herr Hildebrand. She bought $517K with Swissie in August and made a tidy profit of 75K CHF when Swissie was brought down by the actions of SNB. At the peak one could have bought one USD for 0.7 CHF, which is now at .95 CHF, an increase of 35%. Of course, no one could have timed the top, but a 25% gain was there for the taking to diversify out of very dear CHF and into the unloved USD. Fair value for CHF, at $1.05 currently, is $0.85. However, when currencies reverse the trend they never stop at the fair value. Swissie has at least 35% more to go down against the USD over the next few years if historical trends are any guide.
The well-connected Swiss, Frau Hildebrand, made money, while poorly connected and badly informed holders of CHF missed out on once in a lifetime opportunity to move into dollars and even Euro. The worst informed, or the most ignorant, investors are those who were very bearish on the long-term US Treasuries and on the USD 6-9 months ago. There were lot of shysters on financial TV and in newsletter writing business who were making money peddling the bad advice.
Jas
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