Are there signs of a loss of confidence in OECD currencies?
The extremely rapid growth in the money supply in OECD countries may give rise to a loss of confidence in OECD currencies among economic agents, due to fears of a loss in the value of money. What are the signs to watch for in this loss of confidence in money? A rise in real asset prices (real estate, companies); An appreciation of the exchange rates of some currencies perceived as safe havens (Swiss franc, yen); A shift to emerging countries’ financial assets and therefore an appreciation of their currencies; A rise in the prices of assets that can be substituted for money (gold, Bitcoin, etc.); A rise in share prices of growth sectors. We can currently see an appreciation of the Swiss franc and the yen (despite the interventions of the Swiss National Bank and the Bank of Japan), an appreciation of emerging currencies and a rise in the price of Bitcoin and in stock market indices, which is very pronounced for technology companies, but not any rise in the gold price and not yet in real asset prices.