Submitted by Mark O’Byrne – Founding Partner of GoldCore
‘Gold wars’ are intensifying with just 16 days left to polling day in the Swiss Gold Initiative.
‘The Gold Wars’ by Ferdinand Lips
The Swiss National Bank (SNB) and establishment parties went “all in” during the week and intensified their campaign. They suggested that passing the Gold Initiative would be a ‘fatal’ for Switzerland and would be positive only for speculators.
The ‘yes’ side countered by saying the SNB’s assertions were alarmist and over the top. They say that it is not an invitation to speculators as there would be a five year transition to gold being 20% of Swiss reserves. They warned that there is a real risk of another debt crisis and a global currency crisis and that gold reserves would protect the Swiss franc and the Swiss economy.
If the Swiss vote to revert to having 20% of currency reserves in gold, the Swiss National Bank will be forced to make huge purchases of gold bullion. Switzerland and its ‘Gold Initiative’ would contribute to driving the price of gold higher – likely in the short term and contributing to higher prices in the long term.
Understanding the important recent past and what has led to the forthcoming Swiss Gold Initiative is important and why we look at it today. This context is all important and is essential reading for all who wish to understand the key issues in the debate, for all who invest in and own gold internationally and for all Swiss people.
‘Gold Wars’ – The All Important Context and Gold Wars Today
By Ronan Manly,
Golden Constant: Unchanging Swiss Reserves from 1971 to 2000
IMF Threat To Swiss Constitutional Gold
SNB Working Group – Begins Gold Lending
Solidarity Fund Confusion
SNB ‘Expert Group’ Pre Planned Sale Of “Excess” Gold Reserves?
Low Turnout Gold Referendum and New Constitution
Swiss Gold Expert Ferdinand Lips Speaks Up
Jean-Pierre Roth’s Important 20% Diversification ‘Rule of Thumb’
Much of the background to the sale of Swiss gold reserves in the early 2000s relates back to a number of distinct episodes in Swiss monetary history in the 1990s.
A lot of this period was characterised by what in hindsight looks like coordinated planning on the part of the Swiss National Bank (SNB) to push through a specific figure of 1,300+ tonnes of Swiss gold sales, but which back then looked like an unconnected but bungled series of unrelated changes to Switzerland’s gold and monetary landscape.
Furthermore, it is only by reviewing this series of events that it’s possible to appreciate the genesis of the current Swiss Gold Initiative and the motivation of the proponents to call a halt to and try to reverse some of what they see as the unwise sale of Swiss gold due to decisions made in the 1990s. Continue reading