Save Our Swiss Gold
Guns, gold and cuckoo clocks
Fractional American Gold Eagles in 1/10, 1/4 and 1/2 oz Sizes for Smaller Budgets
Update October 30, 2014: Save our Swiss Gold funds frozen
Update November 9, 2014: The Save Our Swiss Gold Battle Heats Up
Update November 27, 2014 – Citibank Issues Anti-Gold Report
The Road to November 30
There are a lot of what if “big” stories floating around that will supposedly drive the price of gold into the stratosphere. The biggest of them all is the Save our Swiss Gold initiative.
The Save Our Swiss Gold initiative sponsored by the Swiss People’s Party, (Schweizerische Volkspartei or SVP) is scheduled for a vote on November 30th and would require the Bank of Switzerland to:
◾ hold at least 20% of its reserves in gold;
◾ repatriate of all of its gold currently held outside its borders; and
◾ ban selling any of its gold.
Ostensibly, if the Save Our Swiss Gold initiative were to pass, it could mean a dramatic rise in the gold price as Switzerland would have to buy back about 1,500 tons of gold to meet the 20% gold reserve requirement.
The Swiss National Bank has sold 1,500 tons of its gold since 2000. The Save Our Swiss Gold referendum, if approved, would prevent further sales and would require the Swiss National Bank to buy all of it back.
As we have seen in the silver market, the laws of supply and demand don’t always apply where higher demand and lower supply result in a higher price.
Will the Save Our Swiss Gold Referendum Pass?
Don’t Under Estimate the Power of Central Banks and the Media
The initial polls show that the Save our Swiss Gold referendum has a good chance of passing when the Swiss go to the polls on November 30 this year.
The battle, however, has just begun.
Against Save Our Swiss Gold
The Swiss Parliament has already voted against the initiative and the Swiss National Bank is on record against it.
Jean-Pierre Danthine, the vice-chairman of the SNB’s governing board has stated SOSG “would severely restrict the conduct of monetary policy.” Restricting loose Swiss monetary policy is precisely the point of the initiative – to prevent the Swiss National Bank from debasing the Swiss Franc further.
Attacks on the Swiss
As November 30th draws closer, expect to see main stream media stories about the quirkiness of the Swiss portraying them as a nation of gun toting, cuckoo clock (actually a German invention) and chocolate making people.
Or worse, we will probably see stories characterizing the Swiss as a nefarious nation of rich one percenters who love hiding Nazi gold and have a long history of acting as secretive bankers to wealthy dishonest Americans to deny the U.S. government of its just tax revenues.
These stories will be designed to make the Swiss appear out of touch with mainstream modern Europe.
Attacks on the Save Our Swiss Gold Sponsors and Supporters
The Save our Swiss Gold referendum is sponsored by the SVP that also sponsored an anti immigration referendum that narrowly passed earlier this year.
Expect the propaganda to be ratcheted up as November 30th approaches and to hear the terms “right-wing,” “far right” and “racist” bandied about in the main stream media when discussing Save Our Swiss Gold, its sponsors and supporters.
If Save Our Swiss Gold passes, the SNB would have to sell billions worth of Euro assets that they bought in recent years to support the 1.2 Swiss Franc to Euro peg in order to buy gold. Such an action would have a negative impact on the Euro.
As such, expect the SVP to be labelled “financial terrorists” and expect statements from other central banks regarding the “danger” that Save Our Swiss Gold presents to the entire global monetary system.
Attacks on Gold
A declining gold price would help take the wind out of the sails of the Save Our Swiss Gold initiative. A declining gold price sends a message that a shiny metal whose price is declining is not worth screwing up the entire monetary system over and validates the SNB’s decision to have sold it.
Central banks will do whatever in their power to ensure that the price of gold remains suppressed as November 30 approaches.
If Save Our Swiss Gold Passes
If the attacks fail and the Save Our Swiss Gold referendum passes, it doesn’t mean that the SNB will immediately set out to purchase gold, make gold repatriation requests to Canada and London and that there will be a subsequent spike in the price of gold.
Indeed, the SNB will most likely drag its feet in implementing the referendum and central banks, thick as thieves, may arrange to short sell gold in the aftermath of the referendum passing and “lease” Switerland the gold they need so as to keep the price of gold under control.
If Save Our Swiss Gold Doesn’t Pass
If the referendum does not pass, the story will be covered in terms of a “settled” issue. Gold, the main stream media will declare, is no longer a monetary asset.
How silly of the Swiss, clinging to their guns, gold and cuckoo clocks to still think so.