Switzerland Launches Referendum To Stop SNB Lunacy, Save Swiss Gold

Tyler Durden's picture

From Alex Gloy of Lighthouse Investment Management

Save The Swiss Gold

According to an article in Swiss newspaper NZZ (Neue Zuercher Zeitung) the SVP party (Swiss People’s Party) launched a referendum to “protect” the 1,000 tonnes of gold owned by the Swiss National Bank (SNB). Their aim is to:

  • make it unconstitutional to sell gold
  • force the SNB to hold 20% of its assets in gold (currently 16%)

The SVP said the sale of 1,500 of the SNB’s 2,500 tonnes of gold was regrettable, especially given the Swiss population had no say in this.

For the referendum to be launched the action committee needs to collect 100,000 signatures from supporters of the measure. They have until March 20, 2013 to do so.

In Switzerland, a referendum is serious business. Direct democracy. Memorable votes include the 1992 decision to stay out of the EU, or the (defeated) referendum to abolish the Swiss Army (1989, 2001).

The initiative could complicate the SNB’s dream to manipulate the EUR/CHF exchange rate. As FX interventions blow up its balance sheet the SNB could be forced to purchase large quantities of gold to adhere to the above mentioned 20% gold ratio.

The 100,000 signatures should be achievable. Having lived in Switzerland for 8 years I could imagine for this referendum to pass.

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AngryGerman's picture

snb buying gold and limiting cash withdrawls by germans plus peg. this will be fun

slewie the pi-rat's picture

they will have signatures before oktoberfest and this will pass but maybe the rest of the gold will be sold by then?

PaperBear's picture

“the sale of 1,500 of the SNB’s 2,500 tonnes of gold was regrettable”

Looks like they had a fool of a Chancellor or Treasurer just like our Mr Brown.

bigdumbnugly's picture

yeah, unfortunately i think that gordon brown was cloned at birth by some diabolical mad scientist and parceled out to as many western nations as neccesary.

Pladizow's picture

This was done in 2000 inorder to join the IMF!

Inorder to be a member of the IMF your currency cannot be backed by gold.

Book on this = Ferdinand Lipps "Gold Wars: Sound Money from a Swiss Perspective"

spiral_eyes's picture

Mr Brown and much of the European establishment have been indoctrinated into the "inflation is good" lunacy.

Chief proponent of that today is Paul "Aliens" Krugman. 

We don’t need more inflation. We need to pay down our debts in a timely and honest fashion, and if we can’t do that we need to default.

Krugman thinks weak demand is eating the global economy. It’s not. The real problem is American imperial overstretch.


Smiddywesson's picture

We long ago passed the point of no return.  Those debts will not be paid in full.  That's why the central banks are buying gold.  We need a system reset.

GeneMarchbanks's picture

'especially given the Swiss population had no say in this.'

Give the full quotation, for full effect for our non-gold holding friends;)

EasterBunny's picture

Didnt Switzerland have to sell gold in accordance with IMF conditions when they joined that institution?


GeneMarchbanks's picture

I believe so, but that doesn't account for 1,500t or whatever the amount was.

Ratscam's picture

dead line for collecting the 100'000 votes is March 31, 2013. 

By then we already have new money.

Ketsa's picture

Yeah and even if we get the 100k signatures by march 2013, we then need to Vote by 2015-2016 or later if they want to drag the thing, They then have a few more years to apply the law.

In fact, no change before 2020 and the SNB can take mesures accordingly.



Crash N. Burn's picture

 Still, when you consider the swiss francs' performance (relative to gold) recently, it is a prudent, albeit late, thought.


Smiddywesson's picture

dead line for collecting the 100'000 votes is March 31, 2013. 

By then we already have new money.

EDIT:  I read this 2012, not 2013.  I agree, that is far too long.

Original comment:  I wouldn't be so sure of that.  TPTB have been surprisingly good at kicking the can, and will no doubt keep changing the rules in what is a man made reality.  Yes, it must come to an end, but I have no idea when.  Catalysts:

Gold prices go vertical

JPM loses control of silver

Global chaos/war breaks out

The central bankers reach their acquisition targets

The Comex blows up

Everyone in the GLD realizes they are on cracking ice and run for the door

China successfully crushes the can so it can no longer be kicked.  Their gold exchange could do that, and there can be no doubt they would love to stick their finger in the eyes of the Fed and ECB

r3vbr's picture

I own my gold in GLD, I know of no other simple way to own gold in a liquid form without paying huge 5%+ markups

give me some suggestions please.

I also own a little GDX.

Smiddywesson's picture

Eric Sprott's PHYS is backed by physical gold in Canada.  You still have the risk Canada or the USG will confiscate or tax it to death, but at least this paper gold is backed by a hard asset.  He also has a very good reputation.

PaperWillBurn's picture

lol..how exactly do you own gold in GLD?

Maybe you meant to say "I track the paper price of gold via shares of GLD"?

AE911Truth's picture

Re: "simple way to own gold"

change to: "simple way to own paper gold"

There, fixed that for ya.

Turd Ferguson's picture

power to the people

Ratscam's picture

Switzerland as opposed to any country in the world has a direct democracy however, the process is so slow that by the time you get to vote as a citizen the iPhone 9 is obsolet.

woolly mammoth's picture

Green arrow for your blog Turd.

Banjo's picture

Maybe the Swiss population should buy some physical gold instead of signing paper. Outside this I would adivse the government and central bank to sell the lot and make it very public. Don't allow China or India buy the lot in bulk instead dribble it out.

Mercury's picture

Or they could give the Swiss public first refusal on any SNB gold for sale.

PaperBear's picture

“force the SNB to hold 20% of its assets in gold (currently 16%)”

I hope that the Swiss people have not been dumbed down so much that they do not view gold as proper money.

Ratscam's picture

I would not even bet fiat money on your hope

apberusdisvet's picture

The banking cartel will not like this.  Maybe the Swiss will be taught  a lesson like Lybia.

AngryGerman's picture

NATO is preparing to strike! keynesian war on swiss!

Azannoth's picture

Suddenly it will be discovered that all of Swiss gold is in fact 'holocaust gold' and needs to be repatriated to Israel with the full backing on the US Army

AngryGerman's picture

but the germans just accidently "found" it during the war

swiss chick's picture

Ir's about time somebody reacts!

scratch_and_sniff's picture

Let the pair dive to 0.5000 and see whos complaining then, for the moment all the SNB has done is some jawboning, there hasnt been a franc used in anger.  

PaperBear's picture

“They have until March 20, 2013 to do so.”

They had better quickly collect the required number of signatures and than quickly take this referendum as I doubt the fiat paper currencies will live past March 20, 2013.

PaperWillBurn's picture

Shouldn't take much buying to send it's price up to a level where it meets or exceeds 20%.


Just a statement of intent to purchase should do it

madgstrader's picture

if their situation is anything like the US it's already been sold. Bill Still on Keiser today covers the Fort knox vanished gold


fenner's picture

SVP vs. SNB? This referendum seems to be passed.

gratefultraveller's picture

From the quoted article:

"The remaining gold reserves should be stored in Switzerland. ... Because a part of the reserves is stored abroad, a situation seen as irresponsible by the initiative committee because of the exagerated indebtment of many countries"

In other words, is Switzerland about to pull a Chavez on the NY Fed and the LBMA, and force them to deliver "real gold" to Switzerland en lieu of the paper gold those guys have almost certainly kept on their accounts for Switzerland?


Smiddywesson's picture

In other words, is Switzerland about to pull a Chavez on the NY Fed and the LBMA, and force them to deliver "real gold" to Switzerland en lieu of the paper gold those guys have almost certainly kept on their accounts for Switzerland

A very good observation by GT made me consider that we don't really know how all this gold is tied together.  It is the nature of central bankers to tie everything together in multiple interwoven obligations.  It very well may be that any repatriation of gold by any country will lead to obligations being felt in NY.  If you pull on a spider's web, it is always felt at the center. 

sudzee's picture

The Swiss population is approx. 8million. I doubt it would take more than a few months to get 100,000 signatures.

TradingJoe's picture

yoou might want to reconsider "few months", more like few weeks!

Baptiste Say's picture

1,500 tonnes of gold is about $90 billion worth or naerly $13000 per Swiss citizen.


The SNB governors who oversaw that sale should be publically raped and then put to death by form of slow slicing.



Forget a constitutional clause to prohibit the sale of the gold, a clause should be passed which returns it to the people who had their income stolen to fund this accumulation, i.e. the Swiss taxpayers.

Ketsa's picture

except it was sold in 2004

Smiddywesson's picture

There were a lot of FX traders who saw their accounts stolen by the SNB recently.  I bet that hurt a lot more than learning the country's gold was sold in 2004.

fdisk's picture

If you think "people who had their income stolen" in Swiss,

While Swissy Trades well above parity with the USD, then what

to say about Americans? That's who's been robbed for sure.

0% interest rate everywhere plus Dollar devaluation.

BTW even at 1.20 per EUR Swiss frank

still 20%+ overvalued and about 50% overvalued to the $USD

at least.

fdisk's picture

NEW resistance for GOLD now $1795, Lower highs, looks like it might go all the way to 1550/oz, cause someone pushing SELL at every pop. Yesterday it TANK at 9:30AM looks like it's going to be same picture today

PaperWillBurn's picture

I fucking hope so. I have some stacking to do

FranSix's picture

Gold prices have some pretty volatile corrections, because of the price fixing mechanism.  But I would expect the price to test the 13-week EMA at the very least.  Prices should be very stubborn here at this point simply because of the discount rate popping into the negative or having the potential to do so.

Smiddywesson's picture

Yes, I would say anything is possible at this point, but they can't break gold or they would have already done so.  My guess is that it is very costly to drive prices lower, and every time they do so, China rushes in and buys.

They cannot allow gold to climb back within striking distance of $2000 while the EU is in flames.  If they can put the EU banking issue on the back burner for a while, the assault on gold prices is likely to abate.  However, if it is going to get worse, they will keep building a bigger buffer by suppressing gold as far below $2k as possible ahead of any impending bad news. 

PaperWillBurn's picture

Your resistance got bitch slapped. I was hoping for a better exchange rate next paycheck.