so now think about it - if Swiss (CHF) suddenly buy a ton of US treasuries, suddenly it will impact their currency - what do you think happens if they buy a lot of US 30y bonds?
Well, lets take a look...
Over the last week of december, it appears Swiss were selling US treasuries.
Then all of a sudden yesterday they decided (with other CB's) to BUY them back.
Every currency is a pair - USDJPY, CADEUR, etc.
DXY is different - its a kludgey ratio tht can be gamed.
Look what happened to DXY when swiss bought a ton of treasuries... (in purple)
CURRENCIES MATTER.
Now lets throw a stonk index on here - QQQ is one of the most sensitive to currencies and bond yields.
Look at that fkr jump around (orange)
Sometimes when i saw "swap" its also CB's dumping or buying bonds, just like this.
The baseball anology - from slide one.
Consider each ball a few BILLION in US treasuries.
If they sell to another CB, It skewes the DXY formula (the ratio is not even between member states).
SOME - like EU- have a MUCH bigger impact to DXY when they buy or sell treasuries.
If the SWISS were to buy treasuries from everyone, the swiss currency would get SUPER strong relative to every other member state - this would be TERRIBLE for swiss economy as a strong currncy kills your exports. npr.org/2011/08/11/139β¦
So what these CB's are doing is COORDINATING;so no 1 member state has a currency that is too strong or too weak - a weak currency creates an unfair advantage
When you go shopping/vacation, you go where the opposing currency is CHEAP relative to your own.
The Final Reckoning - A Nation Consumes Itself
π§΅π
I study the vix, geopolitics and currencies - trying to make sense of what is actually happening in the context of sound bites we get here or there from government.
Its hard to paint an actual picture from a single sound bite or news article.
But when you put them all together you paint a tapestry - some call it a masterpiece - others call it a dystopian hellscape.
For each point I will try to include a relevant news topic.
Lets begin.
The U.S. is not just struggling; it's in a death spiral.
Driven by hyperinflation & desperation, the government is making choices that solidify its descent into kleptocracy and civil breakdown.
Hereβs the terrifying truth that is unfolding
Crypto: Not Innovation, But Capitulation.
The government, facing a worthless dollar, is now frantically trying to contain crypto by regulating it into the banking system.
This isn't forward-thinking; it's a desperate attempt to co-opt the flight from fiat before total loss of control.
Its an admission the dollar is no longer a store of value which is pretty damning for a government to turn against its own currency like this.