Swiss fix Franc vs Euro

This is a very poor decision by the SNB. They will now find depositors from all over Europe choosing the Swiss Franc. Marginally solvent European banks will also choose the Franc as a haven. We are now in a new stage of Currency Wars and uncooperative economic decision making. That is dangerous.

Heading into the Storm

The markets are set for achieving the minimum objective of Dow : Gold of 5:1 On both sides of the Atlantic puerile posturing, ignorance and complacency by politicians only worsens the environment. The European banking system is close to insolvency ( liberal marking of debt and derivatives masks the danger) which has obviously wider ramifications. Bernanke's pledge to keep a quasi-zero rate policy for 2 years is not only unprecedented but is even more dramatic than QE3. Expect further dramatic liquidity injections (QE9, one day?) not because it works, but its the only tool that policy makers can think of as they are caught "in the headlights". If Gold reaches 2.800 this autumn, it might be worth considering taking a partial profit