Posts Tagged ‘ECB’


 

What happens when interest rates are “artificially” lowered below zero ? Denmark moved interest rates below zero in 2012. They are still below zero today. The European Central Bank has introduced a raft of measures aimed at stimulating the eurozone economy, including negative interest rates and cheap long-term loans to banks. It cut its deposit rate for banks from zero to -0.1%, to encourage banks to lend to businesses rather than hold on to money. What will happen then? You already know… Savers will get clobbered. People will borrow money. And asset prices will go up. So what should you do? Own assets. Own stocks and real estate, both in Europe and in the U.S.  I could be wrong of course. But I believe that this is still a time to be playing offense, not defense. There will be a day to play good defense. But we’re not there yet… In my opinion, now is a time to make money.

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Unlike on the two prior occasions when the “mysterious” (coughBIScough) gold seller sold so much gold he briefly broke the gold market not once but twice, this morning’s concerted gold selling episodes, which briefly took gold to a three month low, were unable to obliterate the entire bid stack (at least for now) and crush enough liquidity to force the CME to announce another “stop logic” 10-20 second trading halt.

Source: http://www.zerohedge.com

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Today’s aggressive intervention by various monetary authorities to prevent the Swiss Franc from trading anywhere close to its fair value (yes “intervention”, the same that happens each day in other capital markets, like stocks and commodities, read gold) reminded us once again that it is always and only a central planner’s world.

Source: http://www.zerohedge.com

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Ten days ago, somewhat tongue in cheekly, we presented the “people bringing you currency manipulation on a daily basis” or in other words the BIS execution team for Europe’s central banks, which is most directly engaged in FX and precious metals ‘interventions’ when needed.

Source: http://www.zerohedge.com

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The European Central Bank has launched its search for the person who will chair the new EU-level banking supervisory board.

The powerful new post is part of the response to the eurozone’s crisis over government debt, in which troubled banks have burdened government finances. Banking rules are to be enforced by the ECB at the European Union level _ instead of by national supervisors who can be reluctant to tackle problems in their home banks.

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Spania nu este Grecia – spuneau cu ceva timp in urma, la inceputul crizei datoriilor suverane, oficialii spanioli negand atunci faptul ca Spania se afla in situatia de a solicita ajutor de la UE. Iar oficialii europeni le cantau in struna – asigurand mass-media ca “fenomenul grecesc” este un caz absolut izolat! Ulterior, evolutia crizei datoriilor suverane a aratat ca lucrurile stateau in realitate cu totul altfel. Mai recent, la confiscarea depozitelor in Cipru, oficialii europeni au spus sus si tare ca acesta este un caz absolut izolat, fara nici o sansa de a se mai repeta in alta parte a Europei. Doar ca, acum si portughezii incep sa se teama de soarta depozitelor lor … au oare motive? Istoria recenta ne spune ca DA!

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The latest data analysing speculation in the US futures markets shows an interesting development. The value of the dollar’s net short position fell to $6.43bn for the week ended October 9, from a net short of $16.3bn the previous week, according to Reuters calculations that add up bets on the buck versus major currencies.

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