Swiss Central Bank Chief: Currency Intervention Rescued Economy
Posted by WARREN MOSLER on October 14th, 2012
Yes, as it reduced demand in the euro zone
Swiss Central Bank Chief: Currency Intervention Rescued Economy
October 12 (Nikkei) — A year after the Swiss National Bank made a direct intervention in the the foreign exchange market to halt the overvaluation of the Swiss franc, Chairman Thomas Jordan told the Nikkei in a recent interview that the move helped to stabilize the country’s economy and stave off deflation.
October 15th, 2012 at 3:38 am
“Yes, at the reducing demand in the euro zone”
Why is exporting your unemployment issues to another country via ‘export led growth’ considered acceptable.
Surely it is the worst kind of ‘beggar thy neighbour’ policy?
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Louis Albano Reply:
October 17th, 2012 at 9:22 pm
@Neil Wilson,
Remember, Neil, exports are real costs, imports real benefits. Who cares if the latter brings about unemployment. All one needs is a fiscal adjustment.
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October 15th, 2012 at 6:45 pm
Never thought of it like that, interesting. What else could the Swiss do though Warren?
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WARREN MOSLER Reply:
October 16th, 2012 at 7:23 am
make a fiscal adjustment if they have an output gap.
if they don’t have an output gap they can buy real investments of all sorts.
lots of options
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Piero from Italy Reply:
October 16th, 2012 at 7:38 am
@WARREN MOSLER,
Many italian business move in Swiss even if they have higher labor cost, Swiss agents come in Italy to meet enterpreneus and give him great fiscal advantage in they move there. They finance this with Fiscal Advantage for Black Money from Tax Evasion & Corruption.
Now Swiss problem are :
1) Strong CHF for their export (this is because SBN intervene)
2) Possibility of Pressure of some EU Country against Tax Evasion
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October 16th, 2012 at 10:42 am
Wait a minute, the Swiss have tied the CHF to the US dollar, just like the Chinese have done with the renminbi. If what the Chicoms have done is so evil and unfair why are we still eating Swiss chocolates and wearing their classy watches?
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