I seriously doubt the SNB can ever 'crash' the EUR market.
The market is simply too large for one actor (even a central bank) to bring down.

Remember what happened when Soros "broke" the Bank of England back in 1992? And the market is orders of magnitude larger today than it was then.

Swiss tax laws are expected to change: Mortgage payments might no longer be deductible. Buying to rent could become unattractive because rental income remains taxable.

From the ECB today
“We are experiencing now a second wave of writedowns, which relate to the performance of loans,” said Lucas Papademos, the ECB’s vice-president. "

This was when he was mentioning the ECB forecast that european banks would have to write off another euro 200 Bn.
Funny how quickly we have come to accept & talk about hundreds of billions.

I accidentally stumbled across this FT article today:

They conclude with this caveat:

Given that England is already out, I could lightheartedly come to another conclusion about their Quant model

they may be a bit off about soccer, but at least house prices never fall ..

When you think about it; there really must be a lot of bad debts being written off.
For example the bank base rate in the UK is 0.5%.
If you are a business and want a bank business overdraft with say Barclays Bank. They are lending at 8%. That is a 7.5% markup on 0.5% which is 15 times.
If you go back a few years. Base rate was 7% and business bank overdrafts were lent at 3% above base (i.e. 10%).

And yet, this is just the start; watch for the next instalment of Doom & Gloom with regard to Government Debt.

It's less to do with actually writing down bad debts (ie taking the hit) and more to do with them thinking they could borrow from central banks at close to zero and then earn a decent mark up by investing in "risk free" government bonds. They didn't need to lend to businesses to make a profit. So they could charge what they wanted for business overdrafts...the business model doesn't depend on flow from business loans. That's BIG the problem vis a vis getting the economy moving by extending credit to those that need it. Banks thought they could rebuild their balance sheets virtually risk free by not lending to businesses...now the sovereign debt doubts are calling that "risk free" straegy into question

I actually thought that the banks lacked physical cash so the government in effect gave the banks cash in exchange for the debts on the bank's balance sheet (how many of these are going to be bad debts is to be seen). The banks used the exchanged cash from the government and gave it to their trading division that have been speculating on shares and commodities; hence the increase in shares since March 2009 until recently.

I actually believe that shares and commodities were basically speculated on by elimination as opposed to a desire. What would one invest in at the moment? I keep thinking Gold and then say; it is tto high; only to see it go higher later again.

If you look at house prices; they generally go up when there is available credit. The real driver is when house prices go up at a higher rate than interest rates and inflation (which were supposedly directly proportional on government policy that has been ignored of recent in desperation).

If you look at countriues that have muslims, house prices have not gone up because there are no loans available because their religion does not let them charge interest.

Nope. The banks used government cash to buy government bonds to rebuild their balance sheets. The fact they could earn a mark up was a bonus.
Trading divisions have de-leveraged but it's been easy for them to make money trading bonds, equities and commodities given the customer flows going into each asset class. But much less of the profits have been speculative/risk related than pre the credit crunch.

According to today's newspapers "European commercial banks have begun using their holdings of gold to raise cash with the Bank for International Settlements, in a further sign of strains in the money markets on which many rely for funding.
The BIS, the so-called “central banks’ central bank”, took 346 tonnes of gold in exchange for foreign currency in “swap operations” in the financial year to March 31, according to a note in its latest annual report"

Interesting.
It is also claimed that this is the reason behind the recent fall in the gold price; I suppose people are afraid the BIS will sell this gold? Does not seem likely to me?

I am reading and hearing that gold is a bubble ready to burst.
However, not the real physical hard stuff, but the derivatives; bits of paper stating you own a lump of gold (you know IOU notes in effect).
Supposedly there are like 100 notes for every one bit of gold and if people called in for their physical gold there would be major problems; just like the Northern Rock cash call fiasco.

Is this true; because if it is; it would still be worth buying physical gold surely because there would be a huge demand for a shortage of supply????

http://www.cnbc.com/id/15840232/?vid...8347357&play=1

There was a presentation back in March at the public hearing held by the U.S. Commodity Futures Trading Commission on futures trading in metals.
This presentation claimed the London Bullion Market Association (LBMA) trades more than 100 times the gold it has to back the trades.

Myself If I buy gold, I buy the metal not pieces of paper.
If you must buy pieces of paper look for a statement about the gold it to back the trade that is similar to " segregated and unencumbered gold bullion and does not speculate in gold prices".

I would never or recommend anyone buy a pieces of paper (IOU notes) for Gold.
Lets see what happens when the next financial fiasco occurs.

First, I always make the mistake of assuming that everyone knows when I am being sarcastic... (You'd think a big fat smiley would help!)

Second, your point about muslim countries and loans is absolute bollocks... there are loan products available in every muslim country. They just dont charge interest, which is what is supposedly forbidden. It;s called "Service Charges" instead... same difference

Looks as if the Capitalist State is at it again.

Credit Suisse offices raided by tax officials

http://www.bbc.co.uk/news/10632313

I really think that sensible wealthy people will make sure that they own nothing on paper and electronic transactions (connections) with banks are a no-no; only perhaps safe-deposit boxes but probably even those will be accessible by the state before long.

Lets face it the Money Laundering Regulations have nothing to do with terrorism but the state looking at us for Tax purposes.

From the horse's mouth:
"...The benefits from banking, broadly defined, on current scale and with its existing incentive structure are – at best – very limited. In contrast, the costs – both in the recent past and likely future – are large and actually quite frightening..."

You can read the rest here:
http://baselinescenario.com/2010/07/...ional-edition/

And, as usual, the words thus spoken come not from some neo-marxist blog, but from within the financial world itself.

Paul

don't really get what point thats trying to make?

Just a contribution to the Financial Crisis thread, that's all.
Please feel free to skip

P.

Thanks Uncle Groove - looks like an interesting book to read.

The basic summary is that the author feels increased regulation is only going to get us so far (the financiers being generally able to side-step or work around most regulatory requirements) and that splitting the high-risk parts away from the "deposit taking and loan making" parts of banks is the best solution. Thus if the high-risk parts have a problem, they can be left to fail without destroying the more vital/boring bits.

Finally he is proposing a global organization (similar to the WTO) to oversee all financial companies which would ensure that banks can't just move from highly-regulated countries to less-regulated countries.

All in all, it seems to me like a relatively logical proposal.