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Swiss Gold Referendum “Propaganda War” Begins
Swiss Gold Referendum “Propaganda War” Begins
The referendum for the Swiss Gold Initiative is scheduled for November 30th and the propaganda war - between the Swiss National Bank (SNB) and the Swiss Parliament on one side and the Swiss People's Party (SVP) on the other - has begun and we expect it to escalate as the day draws nearer.
Swiss Gold Coin
The SNB, who oppose the initiative, has warned that a 'yes' vote would severely hamper the ability of the central bank to conduct its business. A proposal that the SNB should hold a fifth of its assets in gold and be prohibited from selling the precious metal in the future would severely restrict its ability to conduct monetary policy, Vice President, Jean-Pierre Danthine, told the Wall Street Journal.
The gold referendum was proposed by the SVP and backed by the necessary 100,000 signatures required the put an issue to referendum in Switzerland. The SVP is one of the largest political parties in Switzerland. The party is the largest party in the Swiss Federal Assembly, with 54 members of the National Council and 5 of the Council of States.
This indicates a degree of popular support for the measure and all eyes are on November 30th. If the referendum is passed, it would result in the following:
?*the repatriation of Swiss gold reserves currently believed to be in the UK and Canada
*an increase in gold holdings of the SNB to reflect an allocation of 20% of total reserves (today gold accounts for 7.7% of total reserves)
*and a moratorium on the sale of Swiss gold reserves
The SNB opposes the repatriation issue on the somewhat flimsy grounds that in a dire national emergency foreign holdings could be sold quickly whereas domestic holdings may be tied up.
This appears to be disingenuous as many international buyers including the People’s Bank of China and other central banks would likely be willing to buy the Swiss gold reserves in loco Switzerland, and then repatriate or take delivery to their own country.
Many Swiss look with alarm at the recent German experience, when Germany attempted to have their sovereign gold repatriated from the U.S. Of the 300 tonnes requested it has, to date, received a mere 5 tonnes.
Speculation, even among more sober gold analysts, is that the central banks of the world no longer have the gold they claim to have. Some of the gold belonging to the people of the west appears to have been loaned, leased or indeed sold onto the market.
This may have been done in an attempt to suppress to gold price and maintain faith in the dollar, euro and other fiat currencies and indeed maintain faith in the fragile monetary and financial system.
Much of the physical bullion is now in the very strong hands of store of wealth buyers in India, China and Asia. Other strong hands who have been allocating to gold are Asian and other central banks including Russia’s central bank as stealthcurrency wars continue.
That central banks have likely been involved in manipulating the gold price was confirmed again recently by Alan Greenspan in his recent essay in Foreign Affairs on gold as an invaluable monetary asset where he wrote "[the western central banks] all agreed to an allocation arrangement of who would sell how much, and when..."
The requirement for the SNB to hold 20% of its reserves in gold is also opposed by the central bank on the basis of the jaded and disingenuous argument that gold does not pay interest and does not yield a dividend. Therefore, the stipends it regularly pays to the state and the cantons would have to be curtailed.
This overlooks the fact that with interest rates at record low levels near 0%, central banks are receiving very little yield on their dollar and foreign exchange reserves.
It also ignores the very purpose of holding gold. As we consistently emphasise, gold is a real tangible, safe haven asset that cannot be debased by politicians, bankers and central bankers.
In this time of continuing QE, it is more prudent than ever to hold a greater balance of gold as a hedge against fiat currencies being further devalued and from potential declines in stock, bond and property markets.
Indeed, as Bloomberg reported over the weekend, Mario Draghi has intimated that the ECB may disregard German objections and begin to expand its balance sheet and print euros in a last-ditch attempt to stave off deflation.
This, despite the fact that the same policies have been an abysmal failure in Japan and are not working in the U.S.
Indeed, the weak data out of Europe last week spurred Stanley Fischer, vice-chair of the Fed, to state that the European situation would have to factor into any decision to raise interest rates in the U.S.
This weak data and the apparently dovish tone of last weeks Fed statement had already had an adverse affect on the dollar - reversing a 12-week run-up - and equities in recent days- indicating, once again, that currencies are as volatile as gold and, in extremis, far less safe.
The reserve status of the dollar grows ever-more precarious as confirmed, yet again, over the weekend when Bloomberg reported that the governor of the central bank of China claimed that some countries were already using the yuan as a reserve currency, albeit informally.
While on the subject of China it is worth noting that Chinese gold demand last year - previously regarded as voracious - was actually twice as high as had been estimated and is on track for over 2,000 tonnes again this year.
The previous estimate was based on flows of gold through Hong Kong. But Xu Luode from the Shanghai Gold Exchange confirmed what more astute gold analysts have been asserting in recent months, that other cities in China are now also importing large volumes of gold - far more than through Hong Kong alone.
Demand from the growing middle classes of China, India and the East continues to grow ever stronger. Clearly, China, India and Asia’s appetite for gold is far from sated.
Back in Switzerland, the SNB also objects to the third aspect of the Swiss Gold Initiative i.e. the moratorium on sales of Swiss gold. From their perspective it would encumber their ability to conduct business.
In a shameless display of attacking the man and not the ball and with tongue planted firmly in cheek, we would question the SNB's skill in conducting effective monetary policy at all - at least insofar as gold is concerned.
We would recall how, in 1999 - around the same time as Gordon Brown's infamous blunder, the SNB sold a whopping 50% of the gold belonging to the Swiss people at the very bottom of the market in what appears to have been an attempted coup de grace on the "barbarous relic." 
Gold in U.S. Dollars- 20 Years (Thomson Reuters)
Well fifteen years later and gold has risen from $250/oz in 1999 to over $1,230/oz or nearly 5 times, and gold is as valued as it has ever been, particularly by non western central banks and by the people of Asia.
The maxim that all fiat currencies eventually revert to their intrinsic value has generally been vindicated in monetary and economic environments such as we are now witnessing.
And if the mass of what has historically been regarded as a true store of wealth, gold bullion bars, are now sitting in vaults in the East - it suggests that we in the West could be in store for further currency devaluations and a further decline in our living standards.
With this in mind we hope the Swiss people display their fierce independence and reject the advice of the "experts," many of whom got us into this mess, in favour of the policies that have kept them peaceful and prosperous for centuries.
The referendum has the potential to become a lightning rod that leads to an increase in awareness about the importance of gold as a hedging instrument and a monetary, safe haven asset. It could also potentially lead to a marked increased in official or central bank gold demand and substantially higher gold prices.
Must Read Guide To Gold Storage In Switzerland
GOLDCORE MARKET UPDATE
Today’s AM fix was USD 1,233.00, EUR 974.55 and GBP 772.41 per ounce.
Yesterday’s AM fix was USD 1,228.00, EUR 969.14 and GBP 763.82 per ounce.
Gold climbed $9.00 or 0.74% to $1,232.70 per ounce and silver rose $0.10 or 0.58% to $17.45 per ounce yesterday.
Silver in U.S. Dollars - 1984 to October 14, 2014 (Thomson Reuters)
Gold in Singapore ticked marginally higher initially but then saw slight falls and it remains largely unchanged from yesterday's close in New York.
SPDR Gold Trust holdings, a gauge for investor demand, climbed 1.79 tonnes to 761.23 tonnes on Monday, making it the fund's first inflow since September 10th.
News of the latest delay in interest rate hikes from the Fed and concerns about the Eurozone and global economy has seen sharp sell offs in stock markets. This coupled with the dollar registering its worst day in a year, sent investors into safe haven gold bullion.
Must Read Guide To Gold Storage In Switzerland
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Gold. Meh. For about 500 bucks I can store a ton of feed store wheat. Heavy as hell, needs a grinder, and a stack of white food grade buckets is ugly and takes up space. So why do this? Because I like to eat Bitchez!
A guy by the name of John T. Reed has researched past hyperinflations. Reed says these things typically take two years to sort out. Why not have food for three years?
Cost you far less to build a small silo than 5 gal. buckets
What if the beef rancher has plenty of wheat himself?
A roast beef sandwich without the roast beef ain't much of a sandwich.
Ben Bernanke Lied to us and here's the logic that proves it:
Ben said to Ron Paul that the reason the Fed and the US govt. holds gold is out of tradition even though they do not consider it money and it is a barborous relic. Now, here's the logic:
Since gold is only held as tradition and is a barborous relic with no monetary signifcance, then why can't the Germans get their insignificant gold back. Would it not behoove the ptb to give this burdenus relic back to it proper owners thus relieving itself of the responsiblity of storing it?
They can't remember their first lie.
They remember it well.
They're counting on YOU not remembering it.
Switzerland: the most democratic country in the world. The people make the decisions, not self-serving, lying politians who are puppets of the corporations. It is time we change our system.
People don't need democracy. They need LIBERTY. When are people going to realize they don't need something bigger than themselves to rule over them. How many more millions and billions of people have to die before one figures out that government is a death machine. Government takes anything peaceful and turns it into a destructive weapon. As for democracy, I do not want to be ruled by a mob.
Anybody seen a poll of how this referendum is tracking?
The Swiss are different . See Oath of Rutli in
http://andreswhy.blogspot.com/2012/06/swiss-and-afghan.html
https://www.academia.edu/8770864/Swiss_and_Afghan
The referendum is nutty. The SNB needs to be able to USE it's reserves....that is what reserves are for. "Never Sell' is a problem. If the Swiss people like gold they are far better off holding it themselves than relying on their central bank to hold it for them collectively. All the currency needs to be is a medium of exchange. If it gains vlaue relative to other currencies then the Swiss will have trouble with exports.
The age of begger thy neighbor will come to an end. At some point the function of currencies will be redefined. They will not pretend to be stores of value....just well managed media of exchange.
More fractional reserve brainwashing. WTF, if people want their money, at least 20%, yeah, a miniscule 20% is going to be there, in gold. How much do you think is really in reserve if there is a bank run in the States. Proably nothing because of rehypothecation, but that is another story. Debt and death for full spectrum dominance on slave planet Earth.
Thinking that gold reserves can never be sold is just plain nutty becasue future laws can always pre-empt current laws. It is pretty much universally accepted that Asian gold is in strong hands that will not loose it for many generations. There's no reason why the Swiss should not do the same now. To reject hundreds of years of Swiss tradition in holding substantial gold reserves is just plain nutty.
@ Ghordius: the referendum intended to require that the SNB keep 20% of reserves in gold; amounts in excess of 20% could be traded against market moves in currencies, etc. It appears (to me, anyway) that the PTB intentionally wrote the referendum stupidly so it would fail. Thus intelligent folk (like the typical Swiss citizen) will recognize that the referendum needs to fail, and the PTB will wave their 'victory' as another nail in the coffin of the 'barbarous relic.' Thus the meme of fiat supremacy is maintained as usual (by fraud and deception as needed). If the Swiss see through the misdirection and vote yes anyway, there is always Diebold standing by to adjust the voting results. Probability of failure: just over 100%...
Fishhawk
@Fishhawk see here http://www.zerohedge.com/news/2014-10-10/swiss-national-bank-explains-wh...
the way I understand the referendum's proposal is "no sales whatsoever"
there is no such thing as Diebold, in Europe. not that I know of, and for sure not in Switzerland. paper ballots. very oldfashioned
but they have lots of referenda, in Switzerland. usually, it takes two or three attempts, with careful re-wording, to "get it" there. That's the beauty of the Swiss System, they don't misuse a referendum to close a political question forever
If the SNB loses, gold will be dumped to $900/oz....
And that will be a huge favour for China Russia ,India . At that price they will achieve the goal of controlling the gold market faster and speed up the demise of the dollar . One way or another the Brics will win !
Care to wager on that?
I wonder how INDIA would vote
If gold is so unimportant [according to Bernanke] why is the Swiss Central Bank fiercely fighting this?
Gold will bog down the printing presses and stop the devaluation of people's savings and income. Central banks and/or irresponsible governments **can't** have that...
"My Dear Emperor, that is the most stunning outfit I have ever seen you wear!"
And if Canada and or the UK can't come up with the gold (either), things will get way, way interesting.
I think it is time for another article on gold production, recycling, and country-by-country net flows and claimed reserves. Last time there was such an article, there were ~700 tons not accounted for (deficit) in the flow. If Chinese consumption remains at ~2,000 tons, I suspect there will be a similiar gap.
What makes the Swiss think their gold is there to repatriate? I predict in the case of a yes vote, there will be administative delays while the central bank hopes the Swiss people forget the issue.
So where is Gaddafi's gold? Does Hillery have it?
So where is Gaddafi's 144 tons? Does Hillery have it?
Anybody seen those Diebold voting machines lately?
Oh yeah; they're on there way to Switzerland from Scotland.
By 2016, they'll be ready again for Murica.
Black Box Voting: Ballot Tampering in the 21st CenturyThe implications of the decision to not allow German repatriation of gold is going to be felt for a while.
Why should people have faith in a financial system that countries don't have faith in?
I would be very much surprised in case this initiative is not going through. In my understanding the Swiss know what is the real thing. They trust gold even more than their Swiss Franc. Far more. So the outcome is in my opinion guaratenteed.
Absent a full blown economic crisis in the next 40 days, the referendum will not pass, and even then the chances are slim.
Goldcore is pimping gold (big surprise) and hypocritically using the Swiss gold referendum in its own “Propaganda War”.
They could at least at least address the SNBs concerns instead of flippantly dismissing them. This referendum was either 1) designed to fail or 2) the work product of some rather dumb-as-shit (if well meaning) Swiss PM pimps.
So many analysts overlook the historic Swiss legacies of arming and training all males in the country - not to fight - but to reduce or even eliminate the NEED to fight. They also overlook the Swiss legacies of secure and confidential banking - and (wink, wink) despite US efforts to go after US citizens money in Swiss banks I have to think there are some loopholes. It is very likely the Swiss could surprise the analysts because the Swiss culture recognizes that having gold may reduce or eliminate the NEED for 'extreme measures' by its Central Bank.
Does Gold storage in Swiss storage facilities come under the umbrella of US Foriegn Financial reporting rules?
Race, excellent question! I would just store my stuff at home and damn the torpedoes. Ambiguity is the best form defense.
That would force me into a barter type world, which, while not presently in the crosshairs of the IRS, is covered in the rules of the IRS, quite clearly.
The SNB, who oppose the initiative, has warned that a 'yes' vote would severely hamper the ability of the central bank to conduct its business.
really, think i would vote yes, isn't that the whole idea?
one third of the referendum is about forbidding the SNB to ever sell gold. which is exactly what Nixon's Shock was about
from a perspective of using gold as a monetary metal in the future, or ever again, it's a nail in the coffin
Not at all.
The Swiss could back their currency @ 20% domestically while foreign exchange holders of the franc would know that, although they couldn't redeem for gold, it would be the safest currency going, backed by something.
The problem would be the rush for francs, making their exports too expensive and reducing demand for Swiss goods. On the other hand it would force other currencies to follow suit or suffer a steep devaluation against the franc.
Once the cat is out of the bag...
They should just point out that Gaddafi was killed by the West for his 144 tons of gold. Owning gold can be hazardous to your health and well-being.
Switzerland made a huge mistake joining the IMF back in the late nineties. At that point rhe Swiss National Bank became more concerned with maintaining the US dollar status quo than with the well being of its own citizens. As for the Swiss gold .....? IMF guidelines/rules state that central banks should count gold receivables the same as bullion in the vault.
A yes vote would expose central bankers as the total waste of skin they are.
"Owning"? Maybe, but it's interesting that the destruction of Libya and murder of Qaddafi occurred within a year of the establishment of the African Development Bank funded by Libya - and anchored by that gold.
A taste of what Russia, China, India, South Africa, Iran and Brazil can expect if they let their guard down.
It's not about the gold per se. It's about power, power to control the flow of profits.
THE BEST WAY TO ROB A BANK IS TO BE A CENTRAL BANK...
"*the repatriation of Swiss gold reserves currently believed to be in the UK and Canada"
Ummm...I think they better come to terms with the fact that their gold is gone and they better start buying it by the freakin' ton right now at these rock-bottom prices before what little that's left finally gets vacuumed up by China, India, and Russia and prices eventually skyrocket to 5000+ per ounce.
The real vote by the SVP for the people should be to abolish their central banking system; which should be what all Western countries who are being destroyed by the central banking systems should be doing right now. Wipe them all out. The guillotines are a waitin'...
I think that they have long come to terms with the fact that 'their gold, supposedly held publicly, is gone'. I'm sure that the active supporters of the movement are those holding sizeable private stashes and want to trigger the massive short-squeeze that everybody in the gold community has been waiting for.
Ebola-infected UN doctor dies in Germany, 41 more monitored http://wtfrly.com/2014/10/14/ebola-infected-un-doctor-dies-in-germany-41...