Tuesday, November 8, 2011

Monetary base exploding in Switzerland

If I am reading this right, the Swiss monetary base was 77 billion CHF at the end of July 2011.  At the end of September, only 2 months later, it was at 253 billion CHF.  The increase in liabilities was mostly in sight deposits, and the increase of assets was mostly in foreign currency investments, probably mostly European government debt, excluding Greece of course.

The primary purpose of this is to weaken the franc to make the Swiss economy more competitive, but it also is a bailout of Europe, which needs all the help it can get.

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