Last week saw a coordinated drop in almost every share we own. That is because the selling was very broad and relentless. I think there is a reason for this, which may mean that the market can recoup.

The Swiss National Bank for years has been buying US dollars to keep their own currency lower than it would otherwise be, to be able to sell pharmaceuticals, chocolate, watches, and emmentaler cheese to the world. If there were no deliberate depreciation of the Swiss franc (FXF), sales would be lower and Helvetian prosperity under threat.

When the money is gathered, the Swiss National Bank doesn't just fill its coffers with dollars. It uses robots to buy US listed stocks because this is a better investment than cash. Robots being what they are, the Swiss National Bank also winds up owning lots of non-US stocks which have ADRs traded on the Big Board or Nasdaq.

And the Swiss also like to intervene in currency markets to stop the Swissie from rising too high in the European area, buying euros, sterling, kroners and kronors, rubles, and dinars. There is another robot which buys in serious countries on the Pacific Rim like Australia, Japan, Hong Kong, Singapore, and a few other places. I am not sure which, but there is a different robot at work there buying currency. And the money-mad Swiss of course buy stocks in Europe and the Pacific Rim rather than holding cash in these areas too.

For us, the Swiss mobilization keeps the Swissie at about $1 when it really should be worth much more. And the steady inflow of Alpine money has kept stock markets rising since the global financial crisis, more or less in tandem.

Now after examining their horde of equities in a dozen currencies the Swiss seem to have gotten cold feet and last week they sold a lot of stock. Maybe the reason was that Trump's performance at Davos (in Switzerland) was unconvincing when he claimed credit for Wall Street's rise in his year of office. The Swiss know that it had nothing to do with the man in the White House who undermines some Swiss values like globalism (because lots of bits of the UN are in Switzerland), tolerance (because Swiss talk 4 different languages and are variously Catholic, Protestant and Jewish), helping the world (via the Red Cross, HQ'd in Switzerland), boosting trade (because the World Trade Organization is Swiss-based.) Or it just may be that their neutral foreign policy did not include supporting Putin in return for dirt on the Democrats.

Whatever was the trigger, I think last week Switzerland started dumping US listed stocks. And those major markets. The robot got its orders and sold a bit of everything in the SNB portfolio. The robot sells what its portfolio holds. It doesn't get seller's remorse because it has no feelings. 

If I am right, the big stock dump was a one-off because the SNB would not be selling stocks short. To do that is unSwiss. Once the exit is over, stocks can rise again.