We warned that as November 30 approached the anti Save Our Swiss Gold rhetoric would heat up.
On November 30, 2014, the Swiss will go to the ballot to vote on a referendum, sponsored by the Swiss People’s Party (SVP) – Save Our Swiss Gold that would require the Swiss National Bank (SNB) 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.
A populist referendum like Save our Swiss Gold strikes fear in the hearts of spendthrift politicians and central bankers whose freewheeling money printing follies would be curtailed by such a referendum.
In Save our Swiss Gold – The Battle Ahead, we noted as November 30th approached, there would be banker and media attacks on the initiative, attacks on the promoters/supporters of the initiative, attacks on the Swiss people and attacks on gold.
Attacks on the Save Our Swiss Gold Initiative
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 statements from central banks regarding the “danger” that Save Our Swiss Gold presents to the entire global monetary system.
And here are some of the responses from the SNB:
Thomas Jordan the chairman of the SNB, complained that passage of Save our Swiss Gold would make it harder for the SNB to “do its job”.
In essence Thomas Jordan is saying when central banks create imbalances by manipulating the currency markets they won’t be able to correct those imbalances (further muck things up) if they are restricted by having to maintain 20% of their reserves in gold.
Swiss Bank Whines of Loss of Credibility and Profits
The SNB argues that Save our Swiss Gold would not only impede the SNB from “doing its job” of implementing monetary policy, but also might result in the SNB losing credibiity.
Of course, restraining the SNB from conducting reckless monetary policy that involves printing Swiss Francs out of thin air to buy Euros to maintain the Franc Euro peg at 1.2. is precisely the purpose of the Save Our Swiss Gold initiative. It’s a feature of the Save our Swiss Gold proposal, not a bug!
Perhaps the SNB’s credibility would be enhanced if it conducted monetary policy in a more prudent fashion, restrained by a gold reserve requirement.
The SNB also argues that Save our Swiss Gold could reduce the SNB’s annual profits that it distributes to Switzerland’s cantonal governments.
Fritz Zurbruegg, SNB board memberwarns “The higher the gold content, the smaller the income from interest or dividends,” he said.
This is a disingenous argument, since the misguided goal of European banks is to reduce interest rates to zero or have them negative if possible, in order to boost inflaton and economic growth. If the Save our Swiss Gold initiative were to pass, the loss in interest payments to the Swiss cantons would almost certainly be de minimus.
Attacks on Save Our Swiss Gold Supporters
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.
…expect the SVP to be labelled “financial terrorists”
Here is how Reuters described the Save our Swiss Gold initiative in a November 6, 2014 article: The “Save our Swiss gold” proposal, spearheaded by the right-wing Swiss People’s Party (SVP)”
While falling short of calling the Save Our Swiss Gold proponents “terrorists”, Bloomberg described organizers of the initiative as part of a “splinter” group:
“They may be a splinter group of Swiss politics, but they’re a persistent bunch.”
The word “splinter” is often used by Bloomberg and other media outlets when describing terrorists, as in these stories:
“Of the three groups that have claimed responsibility, all three are splinters of the Pakistani Taliban…
McClatchy Washington Bureau: Think Helping to Fight ISIS Will Get You Off Terrorist List? Think Again; November 4, 2014
“Though Americans are most familiar with the Arab and Muslim factions on the list, the roster is diverse and truly global, including the Japanese religious cult behind a deadly chemical attack on the Tokyo subway and two separate splinter groups from the old Irish Republican Army, or IRA.”
Attacks on the Swiss People
Guns, Gold, Chocolate and Cuckoo Clocks
In Save our Swiss Gold – Guns, Gold and Cuckoo Clocks we wrote wrote:
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.
The story features a large photo of a fake gold bar filled with chocolates being opened by Lukas Reimann, member of the “Save Our Swiss Gold” committee, who used the bar as a prop to make his point at a news conference in Bern, Switzerland.
Rather than focusing on the arguments of Lukas Reinman (the quirky Swiss guy with the box of chocolate in his hands) in favor of Save our Swiss Gold, the story contained many of the same talking points as the Reuters article re the dangers of imposing restrictions on the SNB’s abiity to “do its job.”
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.
Gold Price July – November
The price of gold leading up to the Save Our Swiss Gold vote has been on a steady decline.
Save Our Swiss Gold Pay Pal Account Frozen
The day we published Save Our Swiss Gold – The Battle Ahead, we learned that the pay pal account set up to receive donations in support of the Save Our Swiss Gold initiative had been frozen.
“Clearly the powers that be did not want the campaign to receive this money,” said Egon von Greyerz Managing Partner of Matterhorn Asset Management AG & GoldSwitzerland and supporter of the Save Our Swiss Gold initiative.
Will The Save our Swiss Gold Initiative Pass?
Initial polls show that the Save Our Swiss Gold initiative has a chance of passing.
Reuters writes regarding the prospect that Save our Swiss Gold might pass: “The initiative has sent jitters through both the gold and currency markets.”
For many gold holders, the Save our Swiss Gold intiative has not sent “jitters”, rather tentative paroxysms of joy in anticipations that it might pass.
If it does, it just might make the Swiss National Bank and other central banks go:
Get Free Updates From Smaulgld.com
Peter Schiff’s Message to The Swiss Re Save Our Swiss Gold
Please visit the Smaulgld Store for a larger selection of recommended Kindles, books, music, movies and other items.
Or you can support Smaulgld.com by making all your Amazon purchases through the search widget below and by ordering your gold and silver by clicking on the JM Bullion, BGASC, Golden Eagle Coins, Perth and Royal Canadian Mint ads on the site.
*DISCLOSURE: Smaulgld provides the content on this site free of charge. If you purchase items though the links on this site, Smaulgld LLC. will be paid a commission. The prices charged are the same as they would be if you were to visit the sites directly. Please do your own research regarding the suitability of making purchases from the merchants featured on this site.
Chart Disclaimer: Information presented here has been obtained from a third party and is presented for information purposes only. Smaulgld can not and does not guarantee the accuracy or timeliness of the data displayed on this site and therefor the data provided should not be used to make actual investment decisions. You should always consult a professional investment adviser before investing in precious metals or any type of investment. You acknowledge that Smaulgld assumes no responsibility for the integrity of data on this site.
The content provided here is for informational purposes only. Making investment decisions based on information published by Smaulgld (SG), or any Internet site, is not a good idea. Accordingly, users agree to hold SG, its owner and affiliates, harmless for all information presented on the site. SG presents no warranties. SG is not responsible for any loss of data, financial loss, interruption in services, claims of libel, damages or loss from the use or inability to access SG, any linked content, or the reliance on any information on the site.
The information contained herein does not constitute legal, tax or investment advice and may be subject to correction, completion and amendment without notice. SG assumes no duty to make any such corrections or updates. As with all investments, there are associated risks and you could lose money investing. Prior to making any investment, a prospective investor should consult with its own investment, accounting, legal and tax advisers to evaluate independently the risks, consequences and suitability of that investment. SG disclaims any and all liability relating to any investor reliance on the accuracy of the information contained herein or relating to any omissions or errors and as such disclaims any and all losses that may result.