Switzerland, on the other hand, is grappling with the deleterious effects of the huge gains in the Swiss franc on the country’s economy. That which the SNB previously feared, has now apparently materialized; the index of leading economic indicators has fallen by more than had been anticipated by economists. In the wake of such findings, it might be logical to assume that the SNB will take further measures to restrain the franc.
Currency traders appear to be betting on as much; the franc fell against all 16 of its currency counterparts and is now on track for a third week of losses against the euro. It has already climbed 12% year-to-date and is the best performer among ten other developed-nation currencies. The SNB says that’s more than enough, and perhaps, way too much.
The recent spectacular rise and fall in gold has only intensified the battle for the hearts and minds of retail investors being waged by the ever-ready-to-fleece throngs of opportunists who lurk in the waters of the financial world. The Financial Industry Regulatory Authority has found it necessary to come out and warn about gold-related scams/cons/come-ons in a bold statement the other day. Interestingly, FINRA found that gold is being promoted based on a couple of premises that might be all too familiar to readers of many a so-called respectable and popular hard money publication.
Namely, FINRA cautions would-be gold buyers not to fall for the gold sales pitch that employs the scare of hyperinflation and/or the one related to an imminent economic meltdown. Ha. That would leave about 2.5 publications that correctly frame gold as a necessary insurance asset that (in small doses) might be good for most portfolios. At the present time, gold bullion -oriented and gold stocks-oriented investments are on the top 10 most popular products being pitched at hapless and unwary buyers. But, the herd mentality syndrome remains alive and well, apparently.
To wit, guess what has replaced real estate (and to a certain extent equities) as the “must-have” investment of the day? Well, you already know that answer (and it make for a perfect contrarian “mania” signal all of its own). A recent Gallup Poll shows that gold is thought to be the best long-term investment; a belief shared by no less than 34% of Americans. This, despite the fact that-if you consider “long-term” as 30 years, the yellow metal has been unable to offer a break-even to those who bought it at $875 the ounce back in 1980.
Real estate (that’s so…2006 now!) has fallen to second place, with only 19% believing in it any longer. You do however recall how real estate and real estate “investing” was being promoted/positioned/hallowed just a few short years ago…As for savings accounts and bonds, well, don’t even go there. Americans sure aren’t.
Have a nice weekend,
Jon Nadler is a Senior Metals Analyst at Kitco Metals Inc. North America