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| Subject: | Return of the King Dollar—Re: Swiss National Bank Is "Printing Money" Like CRAZY |
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| Date: | Wed, 7 Sep 2011 16:18:17 -0700 |
| From: | Jas Jain |
Return of the King Dollar—Re: Swiss National Bank Is "Printing Money" Like CRAZY
Hugh: "They're going to soak up so many Euros that they can bail Greece out since Merkel won't. Problem solved."
SNB has done nothing more than burning some speculators in CHF, one of them being Jimmy Rogers, who was crying foul because he didn't sell his Swissies. The same guy has gotten burned at least three times that he shorted long-term US Treasuries. The definition of any dope is that he, or she, cannot admit to being wrong and not knowing what he, or she, doesn't understand. Does Jimmy, the American, understand the US Treasury market? Does he understand the currency market?? What exactly does Jimmy understand??? Other than "Bernanke is Printing Money."
Just wait when all the USD bears get burned because currencies, against the USD, do trend for years and reversals can be painful. Like all markets with a very large number of speculators, the currency markets would inflict the maximum amount of pain on the maximum number of participants. Right now these participants are long-term USD bears.
Bye bye Swissie, see you at $0.70, not anytime soon though. Miss ya. Hint: You were attractive when you were slim; now you have grown way too fat. Ooops. No, dropping 25 lbs wouldn't do. Sorry.
Jas
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Swiss National Bank Is "Printing Money" Like CRAZY—FWC: Swiss FAQs
Far more than the fed, as % of the GDP/GNP.
"I know, I know, lots of people are going to immediately jump to the possibility that this will cause rampant inflation in Switzerland. But it won't. Inflation is not determined by the amount of money in the economy -- it's determined by the amount of demand. That's why gigantic increases in the US money supply in recent years have had no effect on US inflation. The same will be true for Switzerland."
Money supply by itself does not create inflation or makes the currency worth less. US Treasuries and USD bears are a bunch of scaremongers. CHF has taken a 20% haircut, from the peak four weeks ago, against the three top currencies—Gold, USD and Euro. Only those ignorant of economic fundamentals and global trade (more than half of Swiss GDP is exports) were holding CHF at the level of $1.25-1.40, or 1.05-1.10 CHF to a Euro. CHF was being driven by speculation and it provided a great opportunity to diversify out of the CHF.
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