Central Bank Equities Buying

Discussion in 'Economics' started by Stockolio, Feb 21, 2019.

  1. CME Globex Central Bank Incentive Program February 2019

    To qualify for and become a participant in CBIP (a “Qualified Participant”), the applicant must:•Be a non-U.S. central bank, multilateral development bank, multilateral financial institution, sub-regional bank, aid coordination group, or an international organization of central banks•Complete a CBIP application and be approved by CME Group.•Execute all trades solely for the benefit of, and in the Qualified Participant’s name. •Register one or more portfolio managers or representatives. •Have a relationship with a CME Group clearing member. •Have authority to participate in a fee incentive program (i.e. no public or internal policies prohibiting participation).

    https://www.cmegroup.com/company/membership/files/CBIPFAQ.pdf
     
    #21     Feb 23, 2019
  2. sle

    sle

    It's for the bond futures and interest rate products, not for equities. Pretty much every CB out there holds US dollars and many use synthetic cash to term conversion via futures.

    First of all, most probably NOTHING will happen. In their top holding by cash value (AAPL), they own less than a day of volume. Even if they decide to dump it all in a day, they will move the stock by about a day worth of volatility (and that assumes they will be transparent about it). For AAPL that would be about 1%. Second of all, these holdings are part of the asset buying program to fight deflation so it's unlikely they will dump unless Swiss economy recovers dramatically.

    Japanese have been doing it for way longer than either Chinese or Swiss CBs, it was a natural progression from JGB purchases.
     
    #22     Feb 23, 2019
  3. eurusdzn

    eurusdzn

    You mean the sky is not falling, the creek and bad moons are not rising?
    I still hear the voice of raze and ruin.
    Dont go a'roun tonight.
     
    #23     Feb 23, 2019
    vanzandt likes this.
  4. sle

    sle

    Coming from the gym, I saw these 4 dudes on horses, dressed in black. Wonder what's that all about?
     
    #24     Feb 23, 2019
  5. eurusdzn

    eurusdzn

    Central bankers out on the town cuttin' loose.
     
    #25     Feb 23, 2019
  6. sle

    sle

    Powell, Draghi, Carney and Kuroda - the four horsemen of modern monetarism!
     
    #26     Feb 23, 2019
  7. vanzandt

    vanzandt

    :D
    CCR
     
    #27     Feb 23, 2019
  8. eurusdzn

    eurusdzn

    Amazon rates this book title 4.5 stars in the fundamental analysis category. More relevant in todays world than Grahms' Security Analysis masterpiece , says Zerosludge.
     
    #28     Feb 23, 2019
  9. Wrong again... They dipped Equities big time, who has been buying the SP Index in February ?
     
    #29     Feb 23, 2019
  10. sle

    sle

    But of course, you are the only one who is always right.

    However, could you be a bit more clear what am I wrong about:
    * do you disagree that CME CBIP program is primarily geared for interest rate and bond futures?
    * Or maybe you disagree with the fact that BoJ has been buying ETFs for a while now?
    * Or maybe you disagree with the fact that there is 80-100 billion of S&P 500 equities on the balance sheet of SNB?
    * Do you not think that is relatively small (under a percent of ADV) and will not cause the end of the world?
    * Or you are making yet another statement that I can't understand?
     
    Last edited: Feb 23, 2019
    #30     Feb 23, 2019