Central banks are a law unto themselves. And they get away with it because most people have absolutely no idea how they work.
Whist the United Kingdom has just witnessed a referendum of immense importance, it could be argued that a vote by the Swiss in just two months time has even greater significance. The Swiss are about to vote on the way the Swiss National Bank is run. I believe Switzerland is one of the few countries in the world that is even capable of such a vote. It has a history of financial prudence and respectability but recently it has lost most of its prestige as governments around the world, particularly the US, have bullied Switzerland into handed over confidential information in order to grind the last ounce of tax out of their subjects. Even confidential information stolen from the Swiss banking System has been purchased by other governments like Germany to split wide open the confidential nature of personal bank accounts held there.
The Swiss Vote on gold and control of their Central Bank
Over the last few years the Swiss have watched as their financial reputation has been destroyed. More importantly they have witnessed their Central Bank operate in such a cavalier way that the country will hold a vote to reign in what is seen as downright imprudence. In recent years the Swiss National Bank (SNB) has sold off around 60% of the country’s gold reserves and at the same time it has pegged its currency to the Euro.
As the European Banks adopt the policy of unlimited money printing through QE, the Swiss peg of 1.2 Swiss francs to the Euro ensures that Switzerland will be forced along the same path.
The Swiss people believe they are being sold out by a small group of elite bankers with their own agenda and self interest.
I would have to agree with that conclusion. Most countries around the world fall into the very same category. However, whilst the rest of the world continue to let their central banks adopt policies that would result in imprisonment if adopted by the man in the street, the Swiss have decided to call a national referendum on the matter.
Some of the measures being voted on include:
- Prevent the SNB from selling any more of its gold reserves.
- Secure the return of Swiss gold back to Switzerland.
- Create a mandate to ensure that physical gold makes up a minimum of 20 per cent of the SNB’s assets.
I’m delighted that this vote is going ahead. I sincerely hope that the Swiss send a message to the rest of us to reign in the power of all self-serving central banks around the world.
It will also be interesting to see whether the Swiss have better luck getting their gold back from the US than Germany has so far.
Don’t expect to see this very important story on News at Ten any time soon – the last thing we would want is for ordinary people to understand what is really at the heart of the banking system – and that’s the self interest of the banks themselves.
If you are gold bug like me then the result of this vote could be another indicator of the price of gold in the months ahead.