Free Republic

We knew this was the endgame more than two weeks ago when we reported that "Credit Suisse Crashes To All Time Low After Boosting Deposit Rates To Reverse Bank Run" in which we reported that after a quarter of "staggering" bank runs, the second largest Swiss bank - clearly panicking - was offering a 6.5% annual rate on new three-month deposits of $5 million or above - and a rate as high as 7% for one-year deposits - far above matched maturity Bills, and suggesting that to attract a client, the bank is forced to eat a loss.The hope, we...

First Swiss Franc, now Euro... RBC TO CHARGE NEGATIVE INTEREST ON EURO-DENOMINATED BALANCES — Russian Market (@russian_market) January 21, 2015 Opinion: Think negative interest rates can’t happen here? Think again In the last week, the markets have had to get used to the idea of the negative interest rate, where you actually get charged for keeping money in the bank rather than going out and spending it. So far, that is restricted to two relatively small economies, both of which are struggling with the likely launch of a massive program of quantitative easing this week in the eurozone. But what...

Here’s something I didn’t know about the Swiss National Bank: “Many economists believe that balance sheet losses are irrelevant for a central bank, so they should play no role in policy. But the SNB is 45 per cent owned by private shareholders, many of whom are individuals, who receive dividends from the SNB. The rest is owned by the cantons, which have been complaining recently about insufficient cash transfers from the SNB.This ownership structure contrasts sharply with most other central banks, which are in effect government departments, wholly owned by the treasury and therefore the taxpayer. The Swiss set-up makes...

Investors are so nervous that they are basically willing to lose money when they buy some government bonds. It's part of the latest fad in finance that's all the rage: "going negative." The yields on government bonds in Europe and Japan have dipped into the uncharted waters of negative territory. That means buyers of those bonds are essentially taking a loss just to hold onto those assets. They think their money is better off losing a few cents than putting it elsewhere. "It's basically a fee for fear," said Nicholas Colas, chief market strategist at ConvergEx. "Fear of deflation, fear...

The Swiss National Bank has lost control. It is the latest in a list of venerable central banks to be overwhelmed by deflationary forces and global economic disorder. The country is already in deflation. The Swiss franc ended Thursday 13pc higher after the SNB abandoned its three-year efforts to defend a currency floor of 1.20 to the euro. “We have a free exchange rate once again,” said the SNB’s president, Thomas Jordan. Indeed, but nobody is fooled by the SNB’s attempt to spin this as benign. “This is a huge hit to their credibility,” said Deutsche Bank. The official statement...

The Swiss central bank plans to charge depositors a 'negative' interest rate of -0.25 per cent to discourage spooked investors from using it to shelter their cash. Money has flooded into Switzerland as market turbulence caused by the Russian rouble collapse and oil price slide has prompted a desperate search for safe havens in recent days. The Swiss National Bank said it would slash its interest rate on balances of over 10million Swiss francs from January 22 - effectively imposing a charge on depositors wanting to hold francs in a bid to keep its currency artificially weak against the euro.

With last week’s announcement by the Bundesbank of the repatriation of 674 tons of German gold from Paris and NY over the next 7 years, we predicted that an avalanche of gold repatriation requests would soon be made to the BOE and the NYFed. It appears that Switzerland may be next to the game, much to the dismay of the SNB. The Swiss gold initiative, an initiative to Secure the Swiss National Bank’s Gold Reserves, launched in March 2012 by four members of the Swiss parliament, has grown to 90,000 supporters. Once 100,000 supporters are achieved, the Swiss Parliament must...