“Once the dust settles, the markets will come to recognise that the SNB did it right. Central banks are powerful because they can take important decisions, not when they are seen to bow to market pressure. Remember the taper tantrum that followed President Bernanke’s gentle reminder that QE was not for ever. This pre-announcement was also seen as a loss of credibility. It seems that central banks can never win when their actions cause investor losses.”
Charles Wyplosz on the end of the Swiss franc’s one-sided exchange rate band.
More here: http://www.voxeu.org/article/end-swiss-franc-s-one-sided-exchange-rate-band
(Picture from the Economist and Miles Cole)
“Withdrawals from Greek banks exceeded 14 billion euros ($15.9 billion) in the run-up to the snap elections that catapulted the anti-bailout Syriza party to power, including 11 billion euros that were taken out in January, the person said. Between Jan. 19 and Jan. 23 outflows were greater than in May 2012, when Greece was on the brink of exiting the euro area.” reports Bloomber.com
But the money cannot return so fast back to Greece because, as Reuters explains http://www.reuters.com/article/2015/01/23/markets-bonds-euro-idUSL6N0V20QO20150123:
“Also limiting the QE impact on Greece is the limit the ECB imposed on purchases, which is 33 percent of a country’s bond issuance. The ECB already holds a large amount of Greek bonds, so it will not be able to buy new ones until June when some of them expire – and even then only if Athens is in a new bailout programme.”
…you can check out any time but you can never leave” says a new Greek minister of finance, professor of economics at the University of Athens.
Read more at: http://www.bloomberg.com/news/articles/2015-01-27/greece-s-new-finance-minister-says-euro-is-like-hotel-california
“Plans for a full-scale money-printing operation to spur growth and inflation in the struggling eurozone cleared a legal hurdle yesterday after a favourable verdict from the European Court of Justice.”
“Lawrence Summers has taken himself out of the running to be the next chair of the Federal Reserve, withdrawing his name after opposition from key Democratic senators indicated they would oppose his nomination.”
News after Financial Times
“Microsoft is to buy Nokia’s mobile phone business and patents for €5.44bn ($7.2bn) in an all-cash deal that will reshape the telecoms industry on two continents and comprise a big bet that Microsoft can challenge Apple and Samsung. The deal includes €3.79bn for the devices unit and €1.65bnfor patents. Nokia CEO Stephen Elop will step aside to return to Microsoft. Nokia will become a telecoms equipment company, ending a 30-year roller coaster ride with phones. (Financial Times)(Bloomberg)”