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Swiss National Bank Explains Why It Is Against Repatriating Gold
The Swiss National Bank has lashed out at the so-called "gold initiative" efforts to "Save Our Swiss Gold" unsurprisingly proclaiming it as a bad idea. As Ron Paul previously noted, "The gold referendum, if it is successful, will be a slap in the face to those elites," and so the full-court press ahead of the Nov 30th vote has begun (a la Scotland fearmongery) as SNB Vice Chairman Jean-Pierre Danthine explains how a 'yes' vote for the initiative "would severely constrain the SNB’s room for manoeuvre in a future crisis," as it "poses danger to the conduct of a successful monetary policy." His reasoning (below) is stunning...
Via Jean-Pierre Danthine, Vice Chair Swiss National Bank
On 30 November, the Swiss electorate will vote on the so-called “gold initiative” (“Save our Swiss gold”, in full), which, paradoxically, would severely constrain the SNB’s room for manoeuvre in a future crisis. Let me digress for a few minutes to explain why the SNB is opposed to this initiative.
The initiative is calling for three things:
first, the SNB should hold at least 20% of its assets in gold;
second, it should no longer be allowed to sell any gold at any time; and
third, all of its gold reserves should be stored in Switzerland.
Let me address the last point first. Today, 70% of our gold reserves are stored in Switzerland, 20% are held at the Bank of England and 10% at the Bank of Canada. As you know, a country’s gold reserves usually have the function of an asset to be used only in emergencies.
For that reason, it makes sense to diversify the storage locations. In addition, it makes sense to choose locations where gold is traded, so that it can be sold faster and at lower transaction costs. The UK and Canada both meet that criterion. In addition, they both have a strong and reliable legal system and we have every assurance that our gold is safe there.
The initiative’s demand to hold at least 20% of our assets in gold would severely restrict the conduct of monetary policy. Monetary policy transactions directly change our balance sheet.
Restrictions on the composition of the balance sheet therefore restrict our monetary policy options. A telling example is our decision to implement the exchange rate floor vis-à-vis the euro that I mentioned above: with the initiative’s legal limitation in place, we would have been forced during our defence of the minimum exchange rate not only to buy euros, but also to buy gold in large quantities. Our defence of the minimum exchange rate would thus have involved huge costs, which would almost certainly have caused foreign exchange markets to doubt our resolve to enforce the rate by all means.
Even worse consequences would result from the initiative’s proposal to prohibit the sale of gold at any time. An increase in gold holdings could not be reversed, even if necessary from a monetary policy perspective. In combination with the obligation to hold at least 20% of total assets in gold, this could gradually lead the SNB into a situation where its assets would mainly consist of gold: each extension of the balance sheet for monetary policy reasons would necessitate gold purchases, but whenever the balance sheet needed to be reduced again for the same reasons, we would not be able to resell our gold holdings. This would severely restrict our room for manoeuvre.
Furthermore, because gold pays no interest or dividends, the SNB’s ability to generate profits and distribute them to the Confederation and the Cantons would be impaired.
As a final point, note that currency reserves which cannot be sold are not truly reserves. It does not make sense to call for an increase in emergency reserves – gold holdings – and simultaneously prohibit the use of these reserves even in emergencies.
The SNB’s overriding objection to the gold initiative stems from the danger it poses to the conduct of a successful monetary policy. It would severely impair the SNB’s ability to fulfil its constitutional and legal mandate to ensure price stability while taking due account of economic developments, in the interests of the country as a whole.
* * *
We will hazard a guess that the voting will go exactly as Scotland's independence vote went - young vote for it, old against it... as fearmongering status quo managers step up the propaganda with no regard for what happens next.
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Epic LULZ Bitchezz!!
Sounds like the Swiss gold is gone, just like the German AU.
and #4,
..."Paper Fiat is the safest Swiss Asset."
Jean-Pierre Danthine, Vice Chair Swiss National Bank
10% at the Bank of Canada?!? But Canada has 0% fractional reserve banking and zero reserve gold. Why there?
"Where's ze gold, Lebowsky?"
SNB Vice Chairman Jean-Pierre Danthine explains how a 'yes' vote for the initiative "would severely constrain the SNB’s room for manoeuvre in a future crisis," as it "poses danger to the conduct of a successful monetary policy."
Right. Because their monetary policy to date has been so successful.
SNB: Yes, yes, yes, but what is the real reason?
Au shit
#4 - The gun pointed at my head is loaded.
This will be an interesting vote to watch. Fear mongering on a such an issue may not be as effective as it was with Scotland. There is an opportunity for the masses to become better educated about the role of gold and as more become educated, the vote could sway further in favor of repatratriation.
"Limiting Central Bank options", is what gold is all about
This is serious.
Now the Gnomes of Zurich are pissed...
They're small and ugly, but posess powers beyond our comprehension.
One of the things I really like about the Swiss people is their willingness to tell the elites to fuck off whenever necessary...
So I guess SNB Vice Chaiman envisages that there might be a future crisis that could necessitate the selling of up to 30% of Swiss gold. Do go on.
Well, the elites may wishto have it delivered to their private islands, after all.
Mr Soros said that I could use his spare bedroom
knukles:
You've got to use a larger font size for your comments - nobady can read them . . .
-30-
If you're using Firefox, get the "NoSquint" add-on.
Wasn't it the SNB that screwed a lot of folks out of their cash during the GFC?
I don't think it's there, but let me look again (in the toilet).
No Kidding. And since when is Canada a center for the gold trade? What a joke.
In any case, the article's conclusion is mostly wrong: the vote's results will be just like in Scotland, indeed, but the reason the result and 'demographics' will be the same is because the same VOTE FRAUD will take place.
Anyone who thinks secret ballots will be counted fairly is a MORON! (And the greater fools will accept the 'democratic' result).
You should check out the Royal Canadian Mint.
Right. What does Canada have to do with Gold?
http://en.wikipedia.org/wiki/Largest_gold_companies
Gold TRADE, not production - or is the Swiss National Bank planning to buy all the Canadian supply?
Really!
Scotia-Mocatta is one of the ten market-making members of the London Bullion Market Association. Additionally it is one of 5 banks to participate in the London gold fixing. It has a history of 340 years, and is the only original member of the London Gold and Silver fixes to maintain its seats on both respectively.
Scotia-Mocatta is the global bullion banking division of Scotiabank (The Bank of Nova Scotia CANADA).
I think they TRADE in Gold.
....until the Asians tell them to fuck off and really produce the Gold they're "trading".
Watch a crazy Gold price come out of China, they're sitting on shitloads of it, and Comex will have to put up or shut up. Then we're off to the races on the big currency reset.
BRICS gold backed currency?
Being one of TEN "market-making members" means fucking squat. What is their volume of global gold trade? I doubt it is more than 1%.
Similarly, the province of Prince Edward Island is one of TEN provinces, but it only accounts for 0.1% of Canada's land mass. U impressed?
In any case, when the shit hits the fan, Switzerland will discover that all its foreign-held gold has been hypothecated and lost, which is the real reason why they should not hold ANY OF IT outside of their borders, no matter how big Canada (or London) maybe be as a global 'market-maker'.
"It's not the people who vote that count. It's the people who count the votes."
Joseph Stalin
These constant referendums are creating a bull market for Diebold.
Because the US/NY Fed held the Swiss gold hostage during banking secrecy and holocaust retribution negotiations and forced the SNB to sell half of their gold that they had stored with them in the early 2000s. Therefore they stored the remaining holdings in Canada. Not that it is any better.
Ha! The Canadians are like: "Swiss gold?"
"what the fuck, eh? we turned all your shit into Mapleleafs and sold them to the yanks"!
So those maple leafs I lost in the unfortunate boating accident were swiss gold? Well shit. Who woulda thunk.
It is the queen's gold if her ugly face is on the coin.
Both wrong. It was your gold. Posession is what counts, er, or did count.
Au is very malleable, so face, meet large hammer... :>D
also 20% in BoE; so altogether they're voting to repatriate 30% of their gold holdings? BoE and Canada should be able to cough that up easily, this is a nonstory; unless these banks are THAT broke!
Canada has a vibrant gold market with at least two gold exchanges that are for hedgers such as mining companies and users such as the Royal Canadian Mint. It is those markets where "the rubber meets the road". We always hear of the Comex or LBMA where prices are set but those markets will become irrelevant in the years ahead as they are primarily for specs and trade heavily in paper rather than physical.
The RCM is one of the largest producers of retail gold and silver specie. Although best known for the gold maple leaf, the mint also produces a wide range of bars including Eastern ready 99.99 fine kilobars.
BTW... currently gold maple leaf production is at full capacity. It won't be long before they become allocated as the silver maples have been a few weeks ago.
Swiss gold in Canada is in "deep storage" - as in still in the ground.
Canada has 10% of Switzerland's gold. Possession is nine-tenths of the law.
Volker Commission. That's why.
The Bank of Canada in Ottawa is being renovated. They moved the gold to the Royal Canadian Mint down the road. The Swiss gold was all minted into 1oz Gold Maples. Good Luck Swissies on getting it back!
read again the article, you'll see that most is in Switzerland. the SNB spokeman here has it imho right, if gold can't be sold, then it is not a reserve anymore
in fact, gold-backed means you get gold for your banknote, and this would become impossible, then. as such, this referendum is, perversely, anti-gold, as end-result
of course it would drive a bit up the price of gold in fiat, but only for a short while
When you run a confidence scheme such as a fractional reserve banking/credit based money, vast gold reserves that are out of reach of central bank machinations really do bolster confidence. That is why overt US gold sales are completely off the table.
perhaps I have again to clarify the statement: this Swiss referendum has three parts
- repatriation of Swiss gold (similar to what Germany is asking) and
- the SNB to buy more gold, up to 20% of it's balance sheet and
- the SNB to be forbidden to sell gold, in any case whatsoever
and this last part is the most anti-gold initiative I've ever seen, in the long run, similar to Nixon's closing of the "gold window" on August 15th, 1971
in fact, it's exactly the same
they should have made it a 20% floor, not a ban on sales.
The commitee of the initiative isnt very sofisticated economically...
They just read Ferdinand Lips' book "gold wars"
Never being allowed to sell it -- ever would wipe 20% off the SNB's balance sheet as it becomes effectivly worthless.
CHF would skyrocket, but if they cannot sell it -- they might as well have sharpie markers in reserve, at least they could sell those.
It is interesting that it does not directly address the loaning of the gold. I think that is a larger worry. How many times it has been lent and to whom.
You seem to have missed an important point. Owning or not owning gold has nothing to do with selling gold. The Swiss can sell as much paper gold as they wish. Need some examples?
Gold is a store of labour, fiat is a promise of someone's future labour. That promise printed by those who do not labour but who simply skim off the top of those who do!
You seem to have missed an important point. Owning or not owning gold has nothing to do with selling gold. The Swiss can sell as much paper gold as they wish. Need some examples?
Gold is a store of labour, fiat is a promise of someone's future labour. That promise printed by those who do not labour but who simply skim off the top of those who do!
What is interest again? Why is fiat created as debt? The central bank skim!
Are these the same cunts that pegged the the Swissy to the Euro? lol
what would you have done, in their stead? remember that every frigging price-sheet I get from Switzerland is printed in EUR prices. they do not want to trash their economy by pricing themselves out of every market, you know? perhaps I have to spell it out in Frenglish: priceee stabeeeleeeteee
I would have made Swiss banking secrecy iron clad, e.g., a felony to reveal someone'S banking information -- strict border controls coupled with an import tax that is tied to the CHF-EUR exchange, all domestic depoits must be in CHF, and allow the currency to skyrocket.
Energy prices would plummet, and the capital inflows from the rich all over the world keep V1 going as prices free fall for a while until they eventually stabalize. Imports crash in prices, exports get more expensive, but couple it with super cheap energy -- I haven't done an analysis -- but I think the SNB would have been much better off (in the long run) than expanding their balance sheet to keep the 1.20 peg.
mmhhh... except for the banking secrecy part, you don't mind exposing an economy to strong shocks, eh? you know that SMEs would be the first to cry "statism" or even "fascism" to such policies, in Switzerland? Particularly the exporters among them. Those I know well would just flee the country
Perhaps, exporters are a critical part of the Swiss economy, but like the Germans, they compete primarily with the Japanese for quality and not quantity.
So even though the CHF would skyrocket, the cost of production would go down, as any raw materials imported would also collapse in price, thus reducing the cost of production.
Some exporters would leave -- definitely, however, I think a few would enter - just depends on how they structure the manufacturing process to allow for a collapse in the cost of production to compensate for the higher CHF.
Your plan would benefit the Swiss that had most of the capital, the rentiers, and further feudalize those that don't have substantial capital, i.e. the ones that have all those guns to defend Switzerland. Why do you think some of those guns would not be trained on the wealthy? It's unrealistic to believe that you could make a large ARMED segment of society into poor serfs without some nasty consequences.
The only way for the small Swiss manufacturing exporter to compete with the Germans would be to decrease wages to the same level of the Germans. Otherwise, there would be layoffs. There would be no hope for the Swiss travel industry.
Switzerland is too small compared to the EU neighbors that surround it to be able to ignore them. There is a very large amount of cross border trade that cannot be halted without an intolerable amount of swiss pain.
Just like in the MFGlobal collapse: "It's like it just evaporated!...."
A yes vote would reveal the SNB specifically and central banks in general for the slime buckets they are. No doubt Swiss gold has been leased but is counted "as in vault" even though it is really a receivable as per IMF guidelines. I would love to hear them (SNB) explain that to the Swiss public after a yes vote.
See my post below. Retribution time motherfuckers.
ring...ring..hello, this is diebold, how may I direct your call?
there's a much bigger concern here, and it goes all the way the tower of basel:
the west simply does not have that amount of physical gold to supply the SNB, and if the law is passed it would reveal this either in astronomical pricing or non-delivery or a little of both.
What is the total amount in tons that make up this 20%+10% repatriation? That shouldn't be that difficult to obtain back
young vote for it, old against it
Actually, the young might vote against it and the old for it.
There is not going to be a generational divide, but one between statists and libertarians and most likely one between cities (against) and the rural populations (for).
Voting participation rates are usually arround 40% with a heavy bias towards elderly voters.
I thought the voting bias in Swiss referendums - and boy they have lots of them, in my humblest opinion the only sane way to have referendums - is towards a fierce "NO" to nearly all new proposals
There has been an inflationary use of referendums since the 1990s, because a populist party (SVP lead by billionaire Christoph Blocher) discovered them as their tool to gain voters. Before that, almost everything was voted down. Namely the EU membership.
There are some really weird proposals on the ballots lately, like using foreign aid for "voluntary" family planning abroad.
Most weird/bad proposals have been voted down, like a monopolized state run health insurance and several potential tax increases. But other stupid stuff has been accepted, like the drastic limitation of immigration.
Switzerland is Prada Socialism.
it's a mixed bag: the welfare state is out of control, but it's still a good place for businesses in terms of regulations / taxes / qualified workers etc. It's certainly the most competitive economy in Europe.
But a bureaucratic and paperwork nightmare for small businessmen, from what I have heard.
If you have money, then surely the best place to be.
the paperwork is bad everywhere throughout the developed world, but it's better here then elsewhere. I've helped somebody starting a SME. We looked into France, Germany and Switzerland. No chance for FRA and GER...
France? Seriously?
like the drastic limitation of immigration
You mean limitation of immigration is a bad thing?
Swiss seem to be schizophrenic about it. In some instances they seem for it and others, against it.
There is clearly a young vs old, city vs rural, State vs popultion divide in opinion regarding it. However they clearly have problem with demographics and its impact on pensions and healthcare (ponzi).
The thought of getting cut off from USD gravy train and losing their banking industry would clearly give them cold sweats in their sleep, I would imagine.
Hence the Swiss would vote by 50-60% in favour of keeping thier Gold in NY.
We have no overpopulation problem. Immigration was slowed down naturally by the strong CHF. The referendum was reactionary, the problem had already solved itself. The country has a demographic problem (low birthrates, rapidly aging population), immigration is the only solution.
The only solution? There used to be another way of increasing the population. Like getting more kids. Most western European countries have forgot that. Increasing immigration is a sure way to say goodbye to the Swiss way of life. The country and the continent which it resides on will be islamic within the next half century and muslims won't live by Swiss customs.
Meh, increase the tax breaks for having young children, problem solved.
"Hence the Swiss would vote by 50-60% in favour of keeping thier Gold in NY"
"Today, 70% of our gold reserves are stored in Switzerland, 20% are held at the Bank of England and 10% at the Bank of Canada. "
Your comment and the article seem to be disconnected.
"other stupid stuff has been accepted, like the drastic limitation of immigration."
Sorry friend, but you seem to have missed the point that open boarders are the main tool of destruction of the European nation states. To create a great melting pot without reference to culture, heritage, history, religion, language, solidarity, union of purpose, etc.
I wouldn't sell the Swiss short on their gold initiative so easily.
Switzerland is a melting pot, it always has been. 20% of the population are foreigners. The country has 4 official languages: German, French, Italian, Raetoroman. There is no one Swiss culture. The people in Geneva are French leaning, the people in Zürich are somewhat German leaning and those in Lugano are Italian leaning. The country is a loose affiliation of different regions. It's origins are in a defensive pact against outside aggressors. Thats why the central government is still so weak compared to other nation states.
OMG!!! it sounds so like... the EU!!! you are dooomed!!! dooomeeeed!!! and, frankly, you are a shining example to all europe, including your quirks, of which you have plenty
I'd hazard to say that there is a Swiss Meta-Culture, a thin sheet over the Cantonal/Regional cultures. And you forgot your 5th (inofficial) language, English, imo
The Eu started off as a peace project with a common market and turned into a common planning zone with imperial ambitions, so I don't see the parallels (anymore).
nah, I was expecting a better answer. imperial ambitions is a tad... rich. as much as "common planning zone". your economy is tightly integrated in this "New Evil Reich", and your currency, too
Ukraine and the African adventures are clearly imperial.
And the EU has turned into a regulatory nightmare, because its bureaucracy is run French style.
A country right in the middle of that mess can't escape that - naturally. Especially with clueless political decision makers.
Where would we be without ze price stability?
in Weimar?
How is it you are so reasonable with all things except the EU and EMZ -- where ideology trumps common sense and basic math?
I am curious about your common sense and basic math? What do you mean?
Ps. Ghordius, you forgot OR the great depression. Both inflationary and deflationary outcomes would be price unstable. ^^
Motley Fool, absolutely. But I was so proud about making such a concise, short answer...
Re your question, the young man wrote a fashionable Master Thesis about the EUR being doomed. I read half a dozen of such papers, but not his, so I can't say. Nice to see you, btw, long time
It has been yes, nice to see you too. Thanks for the clarity about his personal vendetta.
Completely understandable that you would sacrifice completeness for such perfectly correct conciseness. :)
nah, vendetta is such a light word, and I experienced the real thing
no, we just have spats. he brought some libertarian/conservative values from the States to Germany, and imo projects them in a different policial and cultural environment, which imho must be a quite painful cultural shock hell
I shouldn't really sacrifice completeness to any altar, including mine
I don't know, mostly pithy answers garner more interest than convoluted ones. I think it permissible. :)
I am a libertarian -- no "conservative."
I am an isolationist and think that a government's primary responsibility is to its people -- not people not from within its borders, unless that government invites people in based upon economic need.
I took a political quiz a few months ago, it has me pegged as close to center as possible, and if I were to vote per this quiz -- I would be a solid SPD voter.
Are you familiar with the book "Der Crash ist die Lösung?"
I was reading as both, for several reasons, which again are related to your relative stance to the German political landscape
Isolationism = can it even be traduced in German? In proudly exporting Germany, where "Völkerverständigung" is even in the Hessian Constitution? Note that "Völkerverstandigung" is a very loaded word. it translates in a mandate to understand other Völker, and understanding means peaceful exchange in all ways, including "sharing things"
In Germany, saying that a gov's primary responsibility is to it's... Volk, is... very conservative, bordering to what the GröFAZ predicated, written clearly in the NatSoc agenda. Again, if you practice Völkerverständigung, you share responsibility
The same about your comments on Latin Cultures. Remiscent of the "KulturKampf" that Bismark waged against Catholics. A stance that even remotely resembles what can be seen as well meant old-style WASPishness... "UrKonservativismus", of the kind you'd only find people old like me to recognize as a not-necessarily fascist stance
lately I was surfing and found an American explaining that so: a comment about a culture in Europe is like a comment about race in America
I suspect that quiz does not translate well. It's made for cultural Germans, with German "Litmus Tests", if you want
Perhaps I have to put something together for you. the book, I skimmed only. you reccomend it or would you outline it for me? ;-)
Coupling dramatically incompetative nations under one currency and monetary policy. Target2 imbalances, export/import nations, etc., etc.,
The insanity of the project has been pretty well documented.
Hmm, well there were good reasons. One being that the continent was tired of constant war, and the shackle of shared currency makes it almost impossible.
There is a lot of inefficiency in many euro countries, especially the more socialist ones. Have you taken note of the fact that these imbalances are decreasing?
There is a lot more to the euro project than meets the eye. Superficial examinations fall way short of the mark.
Not that I expect you to take heed of anything I say, of course. :D
I am not the cavman that Ghordo makes me out to be.
The "Europeans are sick of war" argument is crap -- and you know its crap. But lets talk about the EUR and not the EU -- because, admittadly they are different concepts. A shared currency also existed between the French and Italians, as well as some parts of Austria up until the beginning of WWI -- at which point the Latian Monetary Union broke apart. But don't let history get in the way of the great EUR dream, and an endless droning of talking points.
Sure, I don't think anyone with half a brain advocates for a return to 17 currencies -- but going from 1 huge disfunctional one to two one thats work pretty well seems like a pretty good idea to me, and because you go from 17 to 2 you eliminate a lot of the inefficiency that the multitude of different currencies entail.
Would you adovcate the US and Mexico sharing a currency?
Would you advocate North Dakota and Mississippi sharing a currency? Or California and New Hampshire? Or BC and Quebec?
:D
They do and their ability to compete with one another is toughly equal. It took over 150 years to create the usd accepted at par in every state and a civil war. Moreover -- the starting cultures were very similar to one another.
The idea Europe could do it in a couple decades is comical.
But I take it -- again -- pesky facts shouldn't interfere with ideology and intellectually lazy talking points.
Martin Schultz' schtick doesn't fly around here.
Crap eh?
I don't suppose you care that the founders of the euro held this position? How many wars were there in europe in the 20th century? How many in this century?
Regardless that was far from the only purpose in the creation of such. Splitting it in half would be less ideal for some of its' other purposes.
And no, I don't do advocation, and even if I did I am not in general a fan of currency unions beyond cultural borders, but this one will have its' uses come collapse. Thereafter we shall see if the union remains, since there will no longer be as much need.
Motley Fool "groks" it better then you, Haus. First, let's dispel the notion that we founders of the euro are bleary eyed do-gooders riding on winged pink unicorns of universal human goodwhishing. Yes we are sick of war... among ourselves
We are sick of war on this small continent. We hosted enough world wars here. This does not mean, as swissaustrian points out in the same thread, that we are the Angels of Universal Peace. It's just that the available european theathers have simply become too small
One of the biggest threats to our peace on this continent was always... Currency War. The Great Who Devalues More Game, that goes hand in hand with The Great Who Asks More Collateral And Higher Rates In Response To That. Hence the currency grids. The EUR? Take it away, and we'd talk currency grids again, wouldn't we?
This very article is about Switzerland's SNB that unilaterally joined the EUR "grid", by it's "floor". You advocate to let "the markets" reign? Let them float? I say we have made very bad experiences with that, and... the rot and corruption of the FX "markets" is just lately surfacing, piece by piece
In short, we grid our currencies through Frankfurt instead of having a great FX crosses feast in London's and NY's megabanks... and Switzerland joined us, as you can see
As Motley Fool points out, this common currency gives options, "come collapse". Including a return to the pre-grid times
Haus, I write only a fraction of my reasoning behind my cautious support for the EMZ and even the EU
And I still maintain that part of what you call "common sense" is perhaps well suited to the US, but not for Frankfurt, Hessen, Germany, EU
Do you really think I maintain my position on ideological grounds? I'm a man of the political center, open to all sides, all thoughts, all directions... with skepsis
You, on the other side, just astonished me lately, again. I wrote back, have a look. I was perhaps a bit harsh, but my urging is well meant
Why?
There are a few good positive things that the EUR has accomplished that 17 different currencies could not independetly. No doubt. However, these benefits transfer over if you were to break the EUR in half -- without many of the downside that currently exists within the project.
I shouldn't be ashtonishing you. You know exactly where I stand, and I compliment you when you are correct -- and call you out when you are incorrect.
I think your support for the EMZ (EU is a different topic) is ideologically based. But hey, I get paid to crunch these numbers for a living, and my employer specifically targets anglos and asians to fill a few key positions -- to get objective assessments of the situation at hand -- and thus not allow the "emotional attachment" to the project be brought into our analysis -- so what do I know?
Its interesting, we brought in a new guy about 4 months ago from Toyama who knew nothing about the EUR and its problems, but had some awesome Japanese analysis behind him. We were chatting over lunch earlier this week, and he concluded the EUR is more screwed than the YEN.
Thats saying something.
Haus, good for you that you get paid to crunch numbers for a living. But I have a historian's point of view, which tells me that numbers alone don't explain... money. Or, better, moneyness
Psychology of the Markets is relevant, in currencies
That your employer targets anglos and asians to fill key positions is not necessarily related to "get objective assessments", and might be just part of the current and existing trend of financial institutions. Just look at Deutsche
but any "objective assessment" forgets that a currency is made out of millions of daily decisions by it's daily users, those living in the currency zone, using it. and they have a different view of their currency then people outside this currency zone. and note you are using a DollarZoner's description: "emotional attachment". Because Americans have an emotional attachment to their very National currency
in the case of EuroZoners, I'd talk more about the usual "Normalcy Bias", the very same that makes the experiments with shopping with gold coin so funny. And how do your crunch either the emotional attachment or the normalcy bias in your numbers?
Psychology kills Currencies, not Crunched Numbers
"Its interesting, we brought in a new guy about 4 months ago from Toyama who knew nothing about the EUR and its problems, but had some awesome Japanese analysis behind him. We were chatting over lunch earlier this week, and he concluded the EUR is more screwed than the YEN. Thats saying something."
No, it does not impress me. Four months from zero to "know it all" and such a sweeping conclusion? Only youth and an utter belief in the power of putting human action into models and numbers
Can this guy explain why the silver Drachma replaced the gold coins in certain zones of Asia, but not in others? Can this guy explain why a Kurdish enclave still uses a currency that is officially dead? Did he study the varied story of hyperinflations?
the very comparison with the Yen should tell you something: an international currency compared to a national currency. even "screwing up" looks different, in those two cases. how many historic comparisons did you do? does this guy even know how an international currency dies, most cases?
If this referendum goes thru its BIG. You bet the Central Banks are watching.
At any time, any moment, we could be free from our masters forever. First, we must cease our love for those who are destroying us. We must admit to ourselves that we are not free. We must understand that we as a people have had a severe case of Stockholm Syndrome for generations. We must admit that Washington has become worse than ever with our help. We must treasure our children’s lives more than some ‘family tradition’ of serving in the military. We must treasure our legacy assets enough to remove them from large, insolvent banking institutions. We must take responsibility for ourselves by putting our long term savings into gold and silver again, and other tangible properties worth owning (like our people’s land!). We must see the world anew. We Southern Folk have consented to our own servitude with a vengeance, and we must first blame ourselves.
When we admit this, and we each vow to ‘personally secede’ ….and resolve that we ourselves, our families, and our communities will never trust in their rigged games again, we weaken them. Once a man ‘awakens’ to this truth, he can never go back to sleep again.
Let us resolve to look in the mirror, repent of our own consent to servitude first, and then rededicate ourselves to being free. Slaves ask for permission to do something. A free man asserts his rights. Let’s reassert them in every imaginable way, answering to no one but God and ourselves, and let’s do that today
u left out "we must accumulate real wealth in the form of physical Gold and Silver"
add that and then ur ready for a full page ad in the papers.
You aren't an adult if you look up to some other adult. I just shake my head when I hear adults say they are in awe of some politician, business person, pro athelete, etc.
For a recent example, take Michael Phelps. People I know were crushed by his recent troubles. Nothing against the guy, but his skill is swimming fast. The next time I need a fast swimmer to cure ebola or stop ISIS or fix the financial crisis, he will be the first person I call.
Dealing with anybody that will defer to a voice from the sky is futile.
Agreed. It is a sure sign of irresponsible idiocy and hatred.
The only way we can break free is for the people to work outside the current system. You can not vote your freedom from TPTB, you can only take it.
I'm with you brother.
I'm out of the matrix and i'm never going back.
Bullion, lead, land, water and no debt = freedom.
You had me until you had to bust out that fairy tale Godder bullshit. Your cult isn't better than theirs.
Anyone notice that nobody ever talks about rehypothecation anymore???
reasoning for opposition to repatriation...
its gone.
you where expecting a CB to like an actual asset, one not created by a click!!! - dreamer
The secrets to a three card monti must never be revealed!
Swiss bank to the corrupt central banks.... "give us our gold... our new law says you have to"
Central Banks...."hahaha yea right, that was a good one"
I walked past the Bank of England yesterday morning just before 9am and two large Brinks trucks with a heavy armed police convoy were leaving by the back entrance. It looks like somebody is taking delivery...
It's very unlikely to be accepted.
None of the major political players (parties, banks, business lobbies, state governments, unions etc.) is for it. You need their support to win referendums here.
The timing is also off. In 2011 at the height of the gold mania, the chances would have been much better. Now everybody is bashing gold.
The exact wording of the initiative in German is also questionable, because it confuses assets and capital.
Don't hold you breath :(
Agreed, TPTB will never let the people vote them out of their power. They will "let" them vote for insignificant stuff for appearances only; like elections. The votes that would really matter will be suppresed by voter fraud and manipulation by TPTB. Even in the height of the gold buzz in 2011 they would find some way to not let it pass.
It would restrict their ability to make ignorant policy decisions such as pegging to the Euro. Which is why the public is for it. And the SNB needs to understand, it is not their gold and it is not their currency. Both belong to the Swiss people. If the SNB thinks otherwise, they need to be put up against a wall.
They PEGGED to prevent Swiss cheese from going to 700 Euros per gram.
When Greece blew everyone in Europe figured the Swiss have gold so get out of Euro and buy Swiss Franc. It was killing them, so they Pegged.
Hmm, ever hear the phrase "worth its weight in gold?"
Swiss exporters should have just refused to accept soon-to-be worthless Euro-paper for valuable exports. Au/Ag only or go home empty-handed!
I am sure that they are like every other national bank. That is, they have lent their gold out 100 times over. Their gold cannot be repatriated. Every other bank would try to repatriate theirs. Its just like "MONEY". if every depositor went to their bank and asked for their money, the bank could only pay out to the first 0.3% that asked for it. There would be an immediate bank/gold run and a subsequent collapse.
Hmmmmm why lease out gold? Over and over
http://www.kitco.com/charts/g_leaserates.html
http://en.m.wikipedia.org/wiki/Gold_reserve
1040 tons collecting dust and storage fees
In a fiat world, reserve status has always been enforced through the barrel of a gun.
Fuck the useless paper-pushers and their paper promises!
It's time for these fuckers to pay for their sins and actually work for a living again.
So... their currency is not backed by Swiss Chocolates, of which there are a few with a Golden Tickets inside?
;-)
Clearly Swiss banksters have been thoroughly compromised/Zionized. The US-led CB cartel will start attacking the CHF, if they "dare" to pull this stunt. This thing may go the way of the Scottish Referendum, and only their hitherto robust Direct Democracy can save them now.
They will get their gold back just like Germany got their gold back. LOL
well, its a damn good thing their gold isn't held in america. cus we know for damn sure that goldman would have lent it out a zillion times over, and sold the real stuff.
Your gold is my gold is paper gold. We're all rich!
There are so many of these bloodsucking parasites around the world that we could repurpose sports stadiums and sell season tickets for the tribunals and hangings.
I like the way you think.
Imagine the possibilities!?
Penants of each bank. Jerseys of each swinger. Bumperstickers, fridge magnets, car seat covers, and screensavers.... Heck, they could even do endorsements before the 7th inning "stretch".
If the end does come and we see stuff like this just know that the real PTB are not on trial for their lives and the whole thing is a diversion.
S&P, AAA Rating, AA+, U.S. Debt, Debt Downgrade, Loses an Eye
This statement actually makes quite a bit of sense, to me:
"As a final point, note that currency reserves which cannot be sold are not truly reserves. It does not make sense to call for an increase in emergency reserves – gold holdings – and simultaneously prohibit the use of these reserves even in emergencies."
I haven't read the proposed legislation, but assuming it actually does prohibit the use of these reserves even in emergencies, then we have another example of how badly worded bills/referenda can be the best friend of their opponents.
Only the Central bankers think trading gold for someone else's fiat would ever be a good idea. In an emergecy you adjust your exchange rate to gold or buy more. That is the only thing a central bank should be able to do, and only when approved by the government.
The thinking would probably be along the lines of 'if there is an emergency then it should be dealt with via referendum' instead of bankster fiat (decisions). Power to the people and all that. Banksters want control and this takes it away.
Furthermore, what's to say they couldn't acquire gold for transactional purposes versus reserve and just keep it in seperate accounts? This would imply some sort of gold standard for the currency with an emergency reserve that could only be touched as a result of popular support.
This bill might be badly worded but the concept might be pretty good.
Funny how the most capable of gold holding entities don't even bother wanting to hold it and vice versa, peak upside down world.
"""The initiative’s demand to hold at least 20% of our assets in gold would severely restrict the conduct of monetary policy.""" I think thats the the idea here. What has, and is, being done via monetary policy is the cause of the state of monetary policy now. If you can not trust your self, then I'll hold your money, so as to save your self from your self??? No I'll just hold all my own money. I don't trust the banks.
'
NSA has dirt on all these guys
if anyone breaks ranks ... what they did with the babysitter will be leaked ...
"This would severely restrict our room for manoeuvre."
That's the point brah.
"His reasoning (below) is stunning..."
No, it isn't. It's perfectly sensible and straight-forward. If those three things are indeed what the initiative calls for, then the initiative is doomed from the outset - or else I'm very wrong about the good sense of the Swiss people.
Oh really? It might be bad but how is it any worse than the global banking mafia having full control over everything as it does now?
It's time to break the system, not simply add gold reserves in a sensible way. It must be broken. Criminals must be brought to justice. Traitors must hung.
His logic could use a bit of review, no?
"An increase in gold holdings could not be reversed, even if necessary from a monetary policy perspective. In combination with the obligation to hold at least 20% of total assets in gold, this could gradually lead the SNB into a situation where its assets would mainly consist of gold: each extension of the balance sheet for monetary policy reasons would necessitate gold purchases, but whenever the balance sheet needed to be reduced again for the same reasons, we would not be able to resell our gold holdings."
He states that every time they expand the money supply they must buy gold, but cannot sell when they contract. Does not a contraction generate slack? An expansion after a contraction does not require additional gold purchases unless the expansion leads to a record high money suppy. The only way to be forced into a fully gold-backed currency would be to contract the monetary base by 80 percent. So, yes, his reasoning or lack thereof is stunning.
Even worse consequences would result from the initiative’s proposal to prohibit the sale of gold at any time.
AND KEEP ANYBODY ELSE FROM SELLING IT!!!
Gold not under one's direct control is now just another Fiat Currency.
it's all paper gold now.
And if all else fails, there is good old fraud to change the outcome of an election.
SNB makes some good points though, especially regarding the sale of the gold. If it cannot be sold, then what is the point... At least it should be able to act as collateral (I am not sure what is that legally if it is called).
More total B/S. There are of course many possible reasons why Switzerland does not want or even need to repatriate gold.
So, why exactly did Hitler not invade Switzerland even when he publicly stated that one of his main goals was to re-unite the Germanic people?
... and no it has nothing to do with mountains.
Switzerland traded with both sides and was the facilitator of illegal deals of US corporations with the Nazis via the BIS. There was no need to invade, because the country was cooperating already.
Surely it had nothing to do with the high gun ownership amongst the Swiss population. Most Swiss households are still well armed.
If gold earns no intrest or dividends why hold gold at all? Why not make the case to sell all gold holding instead, that way they can actually conduct an audit andl say "Dere is neight gold", the same they would say if an audit were done nuw, but at least they would have an excuse.