Continental Breakfast: The Third Market

 | Aug 03, 2011 | 8:58 AM EDT  | Comments
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It's lazy writing to start with a quote, but, in the words of Krusty the Klown, I'm a lazy, lazy man. And since I've already quoted:

You know what the fellow said. In Italy, for 30 years under the Borgias they had warfare, terror, murder and bloodshed. But they produced Michelangelo, Leonardo da Vinci and the Renaissance. In Switzerland, they had brotherly love. They had 500 years of democracy and peace. And what did that produce? The cuckoo clock. So long Holly. – Harry Lime

And right now the messy land of the Renaissance is messing up the orderly land of the cuckoo clock big time.

Switzerland cut rates today and is warning more action to defends its currency, which is soaring as European money flows into the Swiss franc and out of the euro. Exporters are hollering about the sharp appreciation, but there aren't that many more safe-haven currencies around.

But while the world may have dramatically moved on from the post-World-War-II days of the quote above, it's a least reassuring to see that some basic national identities remain. Compare these paragraphs describing both countries' attempts to grapple with their economic problems.

Switzerland (from Reuters):

"The SNB is keeping a close watch on developments on the foreign exchange market and will take further measures against the strength of the Swiss franc if necessary," the bank said.

Italy (from the FT):

The weakness of Mr Berlusconi – who is facing three trials on charges of tax fraud, corruption and paying an under-age prostitute – has been highlighted by his failure to explain to Italians why, after his repeated assurances that they were safe from the eurozone debt crisis, they must now face higher taxes and years of austerity.

Plus ça change.

On a slightly more serious note, there's been a lot of chatter online about how the weak global manufacturing indicators were a bit drowned out by the debt-ceiling deal on Monday and didn't really sink in until Tuesday's selloff. As with all reasons for market movement, that may or may not be true. But isn't it time we had real-time economic indicators?

I'm not buying that there isn't the money or technology to have real-time payroll numbers or retail inflation data. There's just not the will. Governments like to have the numbers in advance to adjust to the results and there's an element of showmanship that the markets love – reacting to the big miss or beat.

But for the retail investor who can't have a staff say up 24 hours for every global release that may hit his or her portfolio, it makes sense to have a steady stream of updated numbers that can inform investment decisions.

Or we should just have all of them once a year like the Super Bowl.

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