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Swiss Gold "Fire and Smoke" - "Sermons On the Mount" and "Sorcerers Apprentices"
Swiss Gold "Fire and Smoke" - "Sermons on the Mount" and Sorcerers Apprentices"
Central bankers reached a new low overnight when Swiss National Bank President Thomas Jordan warned of "disastrous consequences" from a pulpit in a church on a historic hill in the town of Uster, Switzerland.
“The initiative is dangerous because it would weaken the SNB,” he said yesterday regarding proposals to increase the Swiss gold reserves, at a memorial service in a church which Bloomberg dubbed the 'sermon on the hill.'
The separation of church and state was one of the great achievement of recent years. It looks like we need to see a proper separation of central banking from the state. States and sovereign nations should be in control of central banks, rather than the other way around.
Central bankers and their dogmatic Keynesian money printing creed would like to see themselves and their policies as infallible. Despite, such policies having an abysmal track record throughout history and indeed in recent years.
Central bankers seem to have forgotten that their primary role is to protect the purchasing power of their respective currencies and not to boost asset prices on behalf of corporations and the wealthy - thereby, debasing sovereign currencies.
In the words of the great Rage Against the Machine song, "Hungry people don't stay hungry for long, they get hope from fire and smoke as they reach for the dawn."
The majority of Swiss people are not hungry, Switzerland remains one of the wealthist nations in the world. Although the working and middle classes are seeing significant inflation in the cost of life's necessities in the form of food and accommodation - to buy or to rent an apartment or house is becoming increasingly un-affordable. 
The Swiss being the Swiss don't need fire and smoke, rather they simply have a referendum and allow democracy to decide the matter. However, the yes side and although those who believe in the virtues of sound money and ills and risks of currency debasement will be hoping for some democratic fire and smoke this Sunday.
A victory for the yes side will lead to plenty of "fire and smoke" in the gold market and an earthquake in the global financial and monetary system.
The vote is set to be very close. Polls on such sensitive political and economic matters are frequently wrong.
In Europe many official polls showed people in various European countries would vote for the EU's Lisbon and Nice treaties. People who were allowed the opportunity to vote often voted against the political machine.
There is a lot of discontent and anger against political establishment and our sense is that the Swiss people may give the politicians another bloody nose !

By Ronan Manly, GoldCore Consultant
Introduction
Yes lead fades in new poll
Definitely Maybe
Italian leaning toward gold?
Only SVP voters show a yes-majority
Polls are Snapshots
Sorcerers’ Apprentices
EUR/CHF 1.20 - Line in the Sand
Intervention or no Intervention
Sovereign Wealth Fund transfers
Gold Swap Tricks
Conclusion
Introduction
There is just over one week to go before the Swiss gold initiative referendum on Sunday 30 November. The release of the latest opinion poll earlier this week shows a strengthening of opposition to the initiative at the expense of the yes camp, with the level of undecided voters still a significant component of the equation. Taking the ‘maybes’ into account, there are still, according to the latest poll, 37% of voters who are not definitely yes or definitely no at this stage.
The official pollsters believe that the initiative will likely fail, and perhaps, at this stage they are correct. The intervention of the Swiss National Bank (SNB) into the campaign at every turn seems to have dissuaded some previously ‘yes’ leaning voters. However, the SNB is still not taking any chances and continues to make statements on what it see as the dangers to Swiss monetary policy from increased gold reserves in the form of a 20% gold minimum in the reserves, and a ban on gold sales if the initiative does go through.
The SNB governing board members are also having to contend with a Euro to Swiss Franc rate (EUR/CHF) which has now approached and arrived at the SNB’s Maginot Line, even as the gold and foreign exchange markets perceive that the ‘threat’ of the gold initiative may be about to subside. While investment bank commentary and research is in the majority thinking that the gold initiative will not succeed, recent weeks have seen increased coverage and analysis of the referendum event by the currency and commodity strategists of major banks and trading houses.
Even if the Swiss gold initiative fails and its proponents don’t achieve their desired outcome, the initiative will still be seen in some quarters as an historic event that panicked the Swiss National Bank into a coordinated campaign of opposition and that made currency strategists and financial media around the world sit up and begin to analyse what they may now realise has always been a world class currency in its own right.
It’s also fortuitous in its own way that while the focus has been building on the Swiss gold initiative over the last few weeks, the man who once called gold “a protector of property rights”, that “stands in the way” of the “confiscation of wealth” should now reiterate a similar view when he said on 29 October in New York that:
“Look, remember what we're looking at. Gold is a currency. It is still by all evidences the premier currency where no fiat currency, including the dollar, can match it. And so that the issue is, if you're looking at a question of turmoil, you will find, as we always have in the past, it moves into the gold price.[1]”
No matter what you think of Greenspan, he knows that gold is the world’s premier currency, as do the governing board of the SNB. But whereas Greenspan is now free to say this, the SNB board look too afraid to admit this.
Yes lead fades in new poll
Wednesday 19 November saw the release of a new opinion poll addressing the upcoming Swiss gold initiative referendum. This poll, the second of two polls from well-respected political research institute gfs.bern, and the only officially conducted poll on the Swiss gold initiative, is the final poll before the 30 November referendum.
The gfs.bern survey, which follows on from a similar poll released on 24 October and was conducted on behalf of Swiss state broadcaster SRF, found that 38% of respondents would vote yes to the gold initiative, 47% would vote no, and 15% were still undecided.
The previous poll from gfs had found 44% in favour, 39% against, and 17% undecided, so there has now been a 6% swing away from the yes side, an 8% gain for the no side, and a 2% reduction in the undecided camp. With the previous gfs poll having been published four weeks previously, it appears that campaigning from the ‘No’ coalition of political parties and the Swiss National Bank has had a noticeable impact on the Swiss electorate’s thinking. However, the results also show an electorate that is still someway off from full decisiveness on the Swiss gold reserves issue.
Claude Longchamp, political scientist and chairman of gfs.bern, which carried out the surveys, said the gold initiative, is ‘likely to fail’[2]. SRF, who commissioned the poll, commented that the increasing ‘No’ vote is a normal development in popular initiate polls but conceded that “with 15 percent undecided, the process of opinion formation is far from complete.”[3]
Definitely Maybe
Technically, survey respondents to these Swiss surveys can answer these polls in one of five ways, and there are two extra response categories for those who ‘might’ vote either yes or no but who are still not entirely sure of their intention when responding to the survey. Then, for each side, the pollsters add the ‘definitely’ and ‘maybe’ categories together.
This is best illustrated by the full gfs.bern survey results which were as follows: definitely yes 27%, probably yes 11%, definitely no 36%, probably no 11%, and undecided 15%. Interestingly, this gives a figure of 37% who are, at this stage, not completely definite on how they would vote.
Throughout this gold initiative campaign, another separate on-line poll has also been conducted on behalf of media publication ‘20 Minuten’[4]. The latest gold initiative results from 20 Minuten’s online poll, released on 18 November, showed the Yes vote at 28% versus the No vote at 64%, with 8% undecided. This poll also adds a definitely and a maybe together, for example 'tend to yes' and 'yes' together become ‘yes’.
The previous 20 Minuten poll on 31 October showed 38% yes, 47% no and 15% undecided, so according to 20 Minuten, ‘Yes’ has dropped 10 percentage points while 'No' has gained this 10% plus another 7% from the ‘Undecided’.
As per usual in the non-stop Swiss election and referenda calendar, two other referenda are taking place in Switzerland on 30 November in addition to the gold initiative referendum. Both of these referenda were also surveyed in gfs.bern’s two polls, and there were also noticeable swings in the latest survey results for both of these referenda.
In the Ecopop initiative, which broadly deals with immigration issues, there was a positive 4% swing in the Yes vote from 35% to 39%, with the No and ‘Undecided’ both losing 2% each. In the third referendum, on lump sum taxation for rich foreign nationals, there was a 6% drop in support (6% drop in the Yes side) from 48% to 42%. Therefore it was not just the gold initiative survey results which swung dramatically over the one month measurement period.
Gfs.bern also breaks down its poll results by various different criteria, including region (German, French, and Italian speaking), by political party, and by income level[5].
An Italian leaning towards gold?
Although Switzerland is a multilingual country, each area is officially classified into the German, French or Italian speaking regions, thereby creating three regions. The poll shows that in Italian speaking areas, the yes vote was actually ahead with 47% in favour, versus 28% against. In the German speaking region, the results were 40% yes versus 50% no, while in the French speaking region it was 29% yes versus 41% no. The ‘Undecided’ were a low 10% in the relatively decisive German speaking region, 24% in the Italian region, and a significant 30% in the relatively indecisive French speaking region.
Including the ‘maybes’, then the total combined non-yes and non-no cluster was 33% in the German, 44% in the Italian and 56% in the French region. Therefore, there is still a lot of scope for change in the actual referendum given the large number of respondents who did not give a definitive yes or no answer in the latest poll.
Only SVP voters show a yes-majority
Even though the gold initiative campaign was launched by representatives of the Swiss People’s Party (SVP), following a closely contested party vote, the central SVP membership structure decided not to officially recommend a ‘Yes’ vote. However a lot of the local cantonal SVP party chapters, after their own local votes, did decide to support the initiative. This means that although none of the main Swiss parties actually endorse a ‘Yes’ vote, there is still grassroots supports for a ‘Yes’ vote amongst many SVP parliamentarians and SVP supporters within the Swiss electorate.
This was reflected in the findings of the gfs.bern poll, where, amongst SVP voters, 62% said they would vote for the initiative, while 32% said no. Voters of the other four big parties only indicated yes votes of between 22% and 27%, and no votes of between 58% and 64%. These parties were the Greens, the CVP, the SP, and the FDP. Of respondents without a party affiliation, 29% said yes, 29% were undecided, and 42% said no.
All of these party allegiances, as well as the non-aligned vote, were influential in strengthening the overall ‘No’ vote intentions. However, it’s worth remembering that in the February 2014 popular initiative on Swiss immigration, the ‘Yes’ vote gained a slim majority of 50.3% despite all the main political parties, apart from the SVP, recommending a ‘No’ vote.
There were also differing trends in support for the gold initiative amongst income classes in Switzerland, as measured by household income. Those on lower incomes displayed higher support for the gold initiative compared to those on higher incomes. Amongst respondents with monthly household incomes below CHF 3,000 (€2,500), 52% would vote yes versus 28% no, between CHF 3,000 and CHF 5,000 per month 56% would vote yes and 33% no, while above CHF 11,000 per month (€9,160), only 21% would vote yes and 64% no.
‘Polls are Snapshots’
The gfs.bern survey (via telephone) was conducted by interviewing 1,412 voting residents of Switzerland between 7 November and 15 November[6]. This did not include Swiss expatriates residing in other countries (Swiss expats can vote in Swiss elections as long as they are registered in their home commune, and as long as they vote via their local Swiss consulate or embassy). Approximately 2.6% of the Swiss electorate are registered abroad. For example, in the February 2014 referenda, out of 5.21 million eligible voters, 137,000 were registered as being abroad.
The gfs survey actually asked respondents how they would vote if they were voting the next day, and was open not just to those who intended to vote or had already voted (note that in Switzerland a lot of people vote by post in advance).
Of the survey respondents, 52% said they would actually be voting on the three referenda on 30 November (or had already voted). Gfs.bern says that a 52% turnout is about average for elections in the last year, and this indication is an improvement on the last poll, during which 47% of respondents indicated that they would vote. As an example, in the February 2014 immigration referendum, the turnout was 56.57%, with 2.91 million people voting.
As gfs stated in its conclusion, “polls are snapshots” and they also highlighted that “the authors of the study emphasize that the survey reflects the current situation.”
Sorcerers’ Apprentices
Following a Swiss TV debate about the gold initiative conducted in German last week, another television debate addressing the initiative was held earlier this week, this time in French, and hosted by Radio télévision Suisse (RTS) part of the SRG Swiss Broadcasting group. The transmission included various representatives from both sides of the initiative debate including Luzi Stamm, the SVP lead of the yes campaign, Yves Nidegger national councillor with the yes campaign, investment manager Egon von Greyerz, also of the yes campaign, and Jean-Pierre Roth, a former chairman of the Swiss National Bank representing the no campaign.
Yves Nidegger said that “In 2,500 years I am sure that the Euro won’t have any value, but gold will always have value”. Egon von Greyerz said that “gold is money, gold represents a stable money”. Jean-Pierre Roth countered that “with your initiative you are interfering with the defense of the Swiss Franc, and he added somewhat colourfully that “the initiators (of the gold initiative) are sorcerers’ apprentices because the initiative has tied the hands of the SNB.” Luzi Stamm argued that because of its gold, non Swiss historically see Switzerland as a strong stable country, and he said that “through foreign glasses, a country that has gold inspires confidence.”
Throughout its campaign, the SNB has pleaded that the ‘rules’ required by the gold initiative wording would stifle the flexibility of its monetary policy as regards fx interventions. This argument focuses on two connected points Firstly, the SNB argues that if, while tackling deflation, it expanded its balance sheet while defending the EUR/CHF rate, then it would, under the 20% rule, also have to buy more gold so as to keep the gold cover ratio above 20%. Secondly, if the SNB tried to contract its balance sheet to counter inflation, that since it would be prevented from selling gold, that it would have to sell other reserves, i.e. foreign currencies, and that theoretically, the entire balance sheet could end up being just gold.
While this may be true in the medium term, in a recent report, Commerzbank note that since the gold initiative rules allow the SNB a five year period in which to build its gold reserves towards a 20% level, then in the short term, the SNB can continue to pursue its EUR/CHF defence policy[1]. It also begs the question, how long does the SNB intends to pursue this continuous weakening of its own currency by tying it to a continually weakening Euro. Its also worth looking at how exactly the SNB began their EUR/CHF experiment and what they might do next as regards further intervention.
EUR/CHF 1.20 - Line in the Sand
Since the beginning of November, the Swiss Franc has strengthened noticeably against the Euro, with the EUR/CHF rate moving down from 1.206 to just above 1.201, perilously close to the SNB’s 1.200 line in the sand. It may not appear to be a large move but the approach to the 1.201 area is very significant. Indeed, some of this exchange rate move has been attributed to the market’s anticipation of a close race in the gold referendum.
Most of the EUR/CHF drop occurred in the first two weeks of the month, and the exchange rate has been flat lining since then just above 1.201 after actually breaching the 1.201 mark on a few occasions this past week.
The SNB are terrified about the risks of deflation and the looming escalation of continued loose monetary policy by the European Central Bank which will further weaken the Euro. Inflation in Switzerland is projected to be about 0.3% year-on-year for 2015, and the SNB may need to now crank up the size of its balance sheet to try to induce further inflation back up towards its ‘price stability’ target of circa 2% per annum.
This Swiss Franc strengthening has prompted further remarks from the SNB that the Bank will do whatever it takes to defend the 1.20 level. Fritz Zurbruegg, one of the three members of the SNB governing board, said as much at a banking gathering in Geneva on Thursday (20 November), where he reiterated that the SNB would use the ‘utmost determination’ to defend the 1.20 line, by buying unlimited quantities of Euros and also by using other unspecified policy measures[1]. Is the SNB intervening now? Probably not, but it may be making preparations to do so, given that the EUR/CHF rate is currently staying so close to the 1.200 mark.
Zurbruegg, whose other role is as head of the SNB department with responsibility for financial markets and banking operations, also used the banker get-together occasion to again try to influence the referendum result, when he encouraged the Swiss electorate to reject the gold initiative on 30 November.
One possible unconventional policy measure (for the SNB at least) would be to introduce negative interest rates, thereby making it unattractive for Swiss Franc depositors to make such deposits, which might weaken demand for the Swiss Franc.
Zurbruegg is not the first SNB executive to make such comments about unusual policy measures. The use of unconventional monetary policy instruments has already been alluded to by the SNB. In early October while attending the annual IMF conference in Washington DC, SNB chairman Thomas Jordan said that the SNB was “ready to take immediate action with other instruments”, and he said that “we do not exclude any other measure if it's necessary, including negative interest rates.[2]”
Intervention or no Intervention?
Apart perhaps from the reference to unconventional instruments, the above views are essentially existing official SNB policy, and none of these recent statements from the SNB adds anything new. In fact, the wording of nearly everything Jordan, Zurbruegg & Co continue to pronounce on is nearly identical to the press release that the SNB issued over three years ago on 6 September 2011 titled “Swiss National Bank sets minimum exchange rate at CHF 1.20 per euro” in which it was stated:
“The current massive overvaluation of the Swiss franc poses an acute threat to the Swiss economy and carries the risk of a deflationary development. The Swiss National Bank (SNB) is therefore aiming for a substantial and sustained weakening of the Swiss franc.
With immediate effect, it will no longer tolerate a EUR/CHF exchange rate below the minimum rate of CHF 1.20. The SNB will enforce this minimum rate with the utmost determination and is prepared to buy foreign currency in unlimited quantities.
Even at a rate of CHF 1.20 per euro, the Swiss franc is still high and should continue to weaken over time. If the economic outlook and deflationary risks so require, the SNB will take further measures.[3]”
In the summer of 2012 there was further large scale interventions by the SNB where the Bank bought Euros and added about another CHF 150 billion to the SNB balance sheet (Some of these Euros are then converted into other major reserve asset currencies such as the US Dollar using a weighted target portfolio of currency reserves that the SNB adheres to).
In September 2012, the SNB again reiterated its September 2011 monetary policy stance, nearly verbatim, when it said:
“The Swiss National Bank (SNB) is leaving the minimum exchange rate unchanged at CHF 1.20 per euro, and will continue to enforce it with the utmost determination. It remains committed to buying foreign currency in unlimited quantities for this purpose.
The Swiss franc is still high and is weighing on the Swiss economy. For this reason, the SNB will not permit an appreciation of the Swiss franc, given the serious impact this would have on both prices and economic performance in Switzerland.[4]”
The SNB governing board now appear to have painted themselves into a corner. With the EUR/CHF rate now at their defining line, there is little that they can do under their current monetary policy except continual balance sheet expansion and purchasing of Euros. No matter whether the gold initiative passes or not, this SNB monetary policy looks unsustainable in the long run. Moving back towards a strong currency partially backed by gold might admittedly cause deflationary issues for Switzerland in the short run, but with other currency blocks globally apparently indicating that they are accumulating gold reserves in order to back their currencies with gold in the medium term, maybe Switzerland could lead the way for other Western economies by using gold in its monetary system in the way that it has historically done.
Sovereign Wealth Fund transfers
A number of investment bank currency strategists have raised the possibility that the SNB could create a sovereign wealth fund (SWF) so as to lessen the amount of gold it would need to purchase in the event of a ‘Yes’ outcome in the gold referendum.
These approaches suggest that the SNB could transfer some of the SNB’s existing reserve assets to a Swiss sovereign wealth fund, thereby reducing the amount of reserve assets on the SNB’s balance sheet, the outcome of which would be that the existing gold reserves would then comprise a higher percentage of total reserve assets.
This strategy has been suggested by both Morgan Stanley[1] and Deutsche Bank[2] in recent currency research reports focusing on the Swiss gold initiative.
The balance sheet reserve assets of the SNB are currently valued in the region of CHF 520 billion, of which gold reserves comprise approximately CHF 40 billion, or just over 7.5%, of this total. If today the SNB had to bring its gold reserves up to 20% of its reserve assets this would require the purchase of approximately CHF 65 billion in gold.
Instead, if the SNB transferred a majority of its reserve assets to a sovereign wealth fund, this would reduce the overall size of the balance sheet and could create a balance sheet where the existing gold comprises over 20% of total reserve assets, thereby negating the need to purchase any gold at all.
Deutsche Bank suggests that the SNB could “transfer intervention-related reserves into the sovereign wealth fund as an accounting matter”, and that if these reserves were needed for intervention, then, based on ‘trigger points’ these funds could again “flow from the SWF to the central bank to be used in interventions”.
However, such strategies involving a sovereign wealth fund are not politically palatable in Switzerland. Morgan Stanley points out that the transfer of SNB reserve assets to a SWF would be controversial with the Swiss cantons, because the SNB is expected to maintain its reserve assets at a level which enables it to fulfil monetary policy while distributing other earnings to the cantons. If a transfer of reserves that were deemed to be in excess was undertaken with a SWF, the question would then arise as to why the cantons had not received this transfer.
Deutsche Bank also highlights the political fallout that the use of a SWF might entail, saying that “transferring the SNB’s fx reserves to a fund to avoid gold purchases would be a blatant disregard of the political will and probably involve another referendum.”
Conscious of the controversies surrounding this possibility, the SNB’s Thomas Jordan came out with a statement this week guaranteeing that such a strategy would not be pursued by the SNB if the Yes vote triumphed. Jordan said that such a move was ‘unthinkable’, and he commented that “the SNB cannot simply use some tricks to circumvent the will of the people. I rule that out categorically[3]”.
Gold Swap Tricks
Given that Thomas Jordan is categorically against ‘tricks to circumvent the will of the people’ in a scenario under which the SNB had to increase its gold reserves following a ‘Yes’ majority in the gold referendum, then Jordan should also be expected to be against Deutsche Bank’s other main suggestion in how to allow the SNB to meet the gold initiative 20% rule without actually having to purchase any additional gold.
Using round trip gold swap transactions, where the SNB swaps currency for gold with counterparties on a temporary basis, Deutsche Bank suggests that the SNB could borrow gold just before balance sheet reporting dates, thereby making it look like the SNB had increased gold reserves, and then reverse the swap again after reporting day, returning the claim on the gold back to the lending counterparty.
Deutsche Bank believes that this swaps strategy would be “politically more straightforward than the introduction of a sovereign wealth fund.” But given that in the opaque world of central bank cooperation in gold trading and pooling, central banks are not even obliged to report the details of gold swap activity, surely Deutsche really means that it would be “politically more straightforward” since no one outside a handful of SNB and BIS gold traders, SNB executives, and BIS governors might even be aware that such a gold swap strategy was even being implemented?
And it would also be naïve to think that, in the eyes of many Swiss citizens, the use of gold swaps could in any way be less of a “blatant disregard of the political will” than a sovereign wealth fund, even those citizens who in the eyes of those who might be voting against the gold initiative.
Conclusion
With a large minority of voters still seemingly undecided on the gold initiative question, there still appears to be a lot of uncertainty within the electorate. Therefore, with the final few days of campaigning now approaching, the ‘Yes’ and ‘No’ campaign teams may still have one final shot left at making their case to the ‘undecided’ and the ‘maybe’ groupings, as they try to sway these undecided voters over to one or other side of the argument.
And with the Dutch central bank, De Nederlandsche Bank, having just announced the completion of the repatriation of 120 tonnes of its gold from the Federal Reserve Bank of New York back to Amsterdam, the Swiss electorate may now be wondering whether repatriation of their 300 tonnes of Swiss gold held abroad should now take on added urgency.
[1] http://www.morganstanley.com/institutional/research/pdf/FXPulse_20141106.pdf
[2] http://www.gata.org/files/DeutscheBankSwissGoldReferendum-11-14-2014.pdf
[3] http://www.reuters.com/article/2014/11/16/swiss-snb-gold-idUSL6N0T60FH20141116
[5] http://www.kitco.com/news/2014-11-19/KitcoNewsMarketNuggets-November-19.html
[1] http://www.reuters.com/article/2014/11/20/switzerland-gold-cenbank-idUSL6N0TA5QV20141120
[2] http://uk.reuters.com/article/2014/10/11/swiss-snb-jordan-idUKL2N0S603H20141011
[3] http://www.snb.ch/en/mmr/reference/pre_20110906/source/pre_20110906.en.pdf
[4] http://www.snb.ch/en/mmr/reference/pre_20120913/source/pre_20120913.en.pdf
[1] http://www.cfr.org/financial-crises/alan-greenspan-central-banks-stagnation-gold/p33699
[2] http://www.swissinfo.ch/eng/gold-vote-poll-shows-shift-towards--no-/41126070
[4] http://www.20min.ch/schweiz/news/story/22344101
[6] http://www.srf.ch/news/schweiz/abstimmungen/abstimmungen/die-eckwerte-der-srg-umfrage-5
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About the notion of direct democracy in msg http://www.zerohedge.com/news/2014-11-24/swiss-gold-fire-and-smoke-sermo... : what does prevent other countries to adopt direct Democracy ? 'cause it looks to me that people are better off when they can express their disagreement or propose new changes without going through N layers of politicians ?
Is there a mechanism in the USA or UK e.g. that could allow people to "change lane", so to speak, and to adopt direct democracy ?
The real probelm in today's society is that the banks and the ruling class do not have enough power. We need more rulers, because otherwise we will just run off a cliff - and use up all the resources that our rulers wish to keep for themselves. Power to the elite! (Via the banks.)
Switzerland is a direct Democracy kind of place, I'm sure they will do the right thing and make sure they protect and have a "strong central bank" because a "strong central bank" is always a good thing for the people.
"Strong Central Banks" always look out for the people because if they don't who will?
The horror of a weak central bank, sound money, real money, money based on goods and services, not leveraged military force.
I'm really pessimistic about the end result of this referendum.The propaganda is massive here. And my feeling is that the media are openly biaised in favor of the <no>. The dog knows the hand that feeds it.
But one thing is sure : our two <yes> bulletins are already in the mail box of the office. That's at least something I'll never regret. Voting <no> would have made me feel guilty vis-a-vis my country.
But I agree the Swiss people may get punished if the result shows positive indeed, starting with :
- de facto confiscation (since the SNB will have problems to get physical deliveries) - see the embryo of the principle at http://www.zerohedge.com/news/2014-11-24/deutsche-banks-modest-proposal-....
- endless investigations by the tax authorities in order to try to discover hidden "troves" etc..., endless explanations to give.
- Renewed international pressure against Switzerland for everything, like the ones we saw those last years, with just increased intensity. Or new international treaties signed by the government, making this referendum obsolete given the "hierarchy of norms".
Still. Let's hope the yes prevails.
They may punish Switzerland - but history will regard the Swiss as the country that first took on the bankers. For the sake of the world - please do the right thing and vote YES.
All this jockeying for gold is the initial foreplay that leads to another major War. America loses this one. Envy is the cause of all war. Truth and rightness are on the other side this time. The massively corrupted american hegemony gets overturned in the end. Our greed; their envy. End of story.
anything which weakens the snb is good. this vote is for fiat vs money. the referendum will fail but perhaps it will come back.
anyone who thinks that this speech/sermon is brer rabbit crying foul is a few llights short of a christmas tree. this proposed law will place a strong upward bias on gold, something which fiat lovers do not want and will expend all energy to defeat.
I must say I honestly don't know if the Swiss should vote for or against this. When I first heard about it, I was all for it, then I remembered that back in 1913, before the federal reserve act was passed, all the banksters were "against" the act, so the people thought that it would be a good thing. The deception these criminals use boggles the mind.
That's why we should use our own common sense to make our decisions, instead of using those clowns as point of reference. There is a logical reason for voting yes, and this should be the criteria.
If The President of the Swiss National Bank said it , It means it is BS !
As a principle, any word muttered by banksters is unadulterated Cow Dung !
After reading the sneaky plan about buying gold swaps just before the auditingdates, I wonder if the Dutch really brought home 120 tons of gold or whether they returned 120 "equivalent" tons of gold swaps. Backed, of course, by the full faith and credit of the Fed and JMP who will swap them back for real physical gold whenever the Dutch want (NOT!!!!)
Shiny yellow lead is irrelevant in the current global fiat system unless + until the fiat governments collapse, and that is not happening for decades - these behemoths die very, very, slowly.
Please to meet you,hope you guess my name.
even standing in the pulpit doesn't make jordan credible.
there is something in his demeanor that makes one a bit cautious
Yeah,its the banker look with that suit and tie. No need to look like a banker at church. But hey, he's not holding a gold bar either.
On the scale of central bankers he's actually quite ok.
More conservative than the average central banker money-wise. Doesn't want shitty and unrealisable mandates such as full employment. Advocates the sharing of the financial stability mandate with the FINMA.
I disagree with our current policy but I regard the guy 1000x better than fucking Hildebrand. Not to mention the Bernanke's and the Carney's of the world.
I just don't get it. Having gold weakens you, and the more gold, the more one is weakened.
And at the same time he was making the antigold argument Deutsche Bank was making exactly the opposite argument, wanting to force Germans to sell their private gold holdings to strengthen the economy. If BS could somehow be turned into energy Switzerland would be an energy exporter.
The Power of money belongs to the people who earn it, not to bankers who steal it.
The money, and the power, go to those who make the rules.
Which is why the people who produce the wealth must control the gold, since who holds the gold makes the rules.
This is why the assignee and legal counsel of the Global Debt Facility offered to distribute gold for coin to all of humanity.
https://s3.amazonaws.com/khudes/Twitter11.2.14.1.pdf
https://s3.amazonaws.com/khudes/Twitter10.19.14.pdf
https://s3.amazonaws.com/khudes/ltokyoembassiesoutoftokyo.pdf
If we sit on our butt it won't happen. We need to participate in the transition.
China holds all the gold
If the SNB were being completely honest it would admit that in addition to buying euros to weaken the Franc it could also (drum roll plz....) buy gold.
That would introduce more Franc into the Forex market and therefore 'weaken' the Franc.
What they can't say is the reason...THERE IS NO F'in GOLD AVAILABLE!
In thruth they could also buy paper gold too but there simply isn't any real gold IN SIZE to be had, certainly not enough to do currency manipulation.
This is the dirty little secret in the gold market and among central bankers. Even the movement of 120 tons ($4 billion...a pittance) created a stir when the Netherlands did it.
The paper gold market has caused the POG to fall and fall even in the glaring absence of much physical metal.
Once gold is 30 times its current price gold will once again 'work' as a central bank reserve.
Doubt that?
Gold rose 24 fold after the Nixon shock, by 1980 it was 24 times more than it's 1971 price of $35 per ounce.
Gold suppression works...for a time. That time, this time is almost over.
More than 3/4 of the worlds physical gold flows through Switzerland, and you can swap physical gold for both paper and tangible assets tax free in certain locations, so there various large non-offical stores of gold available. Furthermore, the SNB doesn't have to mark gold purchases to market value, particulalry if they have no plan to sell the gold, they are free to lowball the accounting with an "official" price like the US, or mark it to purchase price until disposed of, and no one is going to seriously question that accounting treatment. So if they were to buy gold from the locals at 10,000CHF per oz they could provide CHF liquidity that the market demands without disrupting everyone else's scramble for physical gold.
If they bid high enough, they will get all the gold they want. Oh; They want the gold for free!
William Tell still has one arrow left.
The lone ranger seems to have been quite a libertarian!
The Lone Ranger rides again
Need any more proof that politics, religion and banking aren't all tentacles of the same beast?
Those who steal from productive people.
Had to write this guy off when he opens with the separation of church and state, as if that is a reality.
The notion of a Central Banker electioneering is disgusting, moreso doing it from a pulpit. However, applying US-centric perspectives and norms to other countries is IMPERIALIST. "Separation of Church and State?" We're talking about SWITZERLAND, not the USSA. Different Cantons have different OFFICIAL STATE SANCTIONED & SPONSORED CHURCHES. Regardless of how much money I put in the collection plate on Sundays - I still have to pay the CHURCH TAX, the corporation I work for also pays the Church Tax which is divided among the official churches. The Cantons have fought wars between one another because of their different official religions. Part of social safety net/welfare state is run through the official churches. In May of this year, there was a ballot initiative in Canton Zürich to stop "corporate persons" from being required to pay the Church Tax, on the grounds that it violated the fictitious religious "neutrality" - and it was soundly rejected (after a lot more preaching and electioneering from the pulpit than we usually get every other time there is a vote coming up).
http://kirchensteuerinitiative-nein.ch/
Great way to open the article...
Edit: After a smoke and actually reading the entire speech (English here, and it is worth reading, despite what I am about to write: http://www.snb.ch/en/mmr/speeches/id/ref_20141123_tjn/source/ref_2014112...).
Jordan should spend some in Hell (or at least Purgatory) for lying from the pulpit, specifically- mischaracterizing the "radical" reform ideas (of which there are actually more than 4), overstating the impact of the referendum on SNB operations, obfuscating the nature of the "limitations" to SNB's power (statutory vs systemic), and most seriously outright lying by stating "we are enormously vigilant in ensuring that our gold is stored safely in every respect, both in Switzerland and abroad." Bar Numbers, Audit Dates, and signed Affidavits please... for the entire period that significant Swiss gold reserves have been held abroad, including the period when FRBNY was used for storing Swiss gold (photographic evidence or YouTube videos would also be nice, but I'm pushing here). Even if Jordan had a come-to-Jesus moment the Sunday before the vote, unless the SNB received the access, and performed the due diligence that others were denied (such as BuBa) - then the Swiss People's mistrust is entirely well founded.
The entire speech is worth reading. Jordon is playing at higher level than some of the propaganda untermenschen that both sides have deployed to persuade the those pesky serfs. It's far more sophisticated and honest than the verbal diarrhea one usually gets from their monetary authorities. Furthermore, the text offers insights into alternative monetary paradigms that are rarely presented, even on ZH, which actually are discussed here and there is historical experience and evidence here to support their efficacy, not mention another referendum the pesky serfs may have next year on fractional reserve banking.
So if you want to read where a central banker and G10 BIS board member preaches that the serfs are free use BitchCoin and BitchCoin in free to compete with CHF, or this following shocking bit on the proposal for referendum on fractional reserve then do read the speech.
"Although the idea of plain money may be interesting in certain respects, I am sceptical as to whether acceptance of the initiative would result in better money. My reticence is born not only of considerable doubts as to the anticipated benefits of plain money, but far more because the introduction of plain money would constitute an enormous experiment for which we lack any experience or comparative figures from the past. Never in monetary history has a country introduced plain money based on central bank money. Assumptions which appear plausible could therefore prove to be incorrect."
I have not seen a complete explaination of the issues. It seems to me if the CHF strengthens then export prices could increase. However, import prices would decrease. So if a manufacturer imports steel or other raw materials for manufacturing his costs would theoretically go down. As his costs go down then the price he needs to sell and export his product goes down. In the end everyone is better off. The Swiss have a stronger, more stable currency and the countries which export to Switzerland get a more valuable and stable payment.
The only people I see who lose are the criminal bankers.
Weaken an entity that creates "money" out of thin air? - I'm all for that! What's the problem?....
The crooks in chief lose some of their power...
If they vote no, in the end they will find, to their detriment, that they chose unwisely.
If they vote yes, they will be punished. They will feel the wrath of god-like men who have the power to create wealth from thin air. God-like men, that can punish billions of people with hunger and poverty, at their very whim.
I doubt many Swiss politicians want to be Ghadafied.
They'll find a way around it.
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Iniatives like this are going to fail, until real actions insert themselves into the faces of the little people in a meaningful way, that they are brought kicking and screaming into the idea that change must come in a rapid manner, or as in the past, not at all.
Then… We'll see action.
•?•
V-V
What no Cheese popes?
Holier than thou. Try Chocolate popes.
“The initiative is dangerous because it would weaken the SNB”
That's the whole point you moron!
Californians vote for great propositions/initiatives all the time. The state government does not implement them. I expect the SNB to do the same.
Ain't dat da troof!
I'm surprised the daemon didn't burst into flames in the church.
I guess it's a half-assed church.
For years I have known that Jesus said, "Give to Caesar that which belongs to Caesar ...". It is only recently that I recognized that Scripture as a call to abandon Fiat. It was probably explained to me as a youngster but for some reason I didn't quite get it back then.
If it belongs to Caesar then give it to Caesar. It is not yours. Then you don't have to worry about the taxes on it either. You gotta find some other way to trade.
King James version Mark 12:17
And Jesus answering said unto them, Render to Caesar the things that are Caesar's, and to God the things that are God's. And they marvelled at him.
I need to read the Bible.
Con, he's in league with Lucifer.
General Buck Turgidson: "Mr. President, we must not permit a Church Pulpit Gap!"