Switzerland to vote on banning banks from creating money

Switzerland will hold a referendum to decide whether to ban commercial banks from creating money. 

The Swiss federal government confirmed on Thursday that it would hold the plebiscite, after more than 110,000 people signed a petition calling for the central bank to be given sole power to create money in the financial system. 

The campaign - led by the Swiss Sovereign Money movement and known as the Vollgeld initiative - is designed to limit financial speculation by requiring private banks to hold 100pc reserves against their deposits. 

"Banks won’t be able to create money for themselves any more, they’ll only be able to lend money that they have from savers or other banks," said the campaign group.

 Iceland - which saw its bloated banking system collapse in spectacular fashion in 2008 - has also touted an abolition of private money creation and an end to fractional reserve banking. 

A date for the Swiss referendum has not been set.

DYI Comments:  Everyone loves the booms but despises the busts.  Fractional reserve banking plays a major hand in distorting economies of countries with fractional lending.  The U.S. with its no reserves fractional lending (Alan Greenspan did away with reserves) creates a wild west show of booms and busts.  Hopefully this will become law not only in Switzerland but Iceland as well.  This would create an additional safe haven for sound currency management in Iceland. Switzerland would go from safe to super safe management of their currency.  Hopefully reigning in the banks will gain traction the world over especially here in the U.S.  But alas, I wouldn't hold your breath waiting.

For those of you who would like a Swiss presence for a portion of your monies look into the Permanent Portfolio symbol PRPFX.  Below is their permanent asset allocation showing their 10% holdings in Swiss Francs.

 

The PRPFX fund is slanted towards inflation(65%) as the aggressive growth stocks (generally small cap stocks) work best when our central bank is able to goose the money supply when price inflation is subdued.  Today the Fed's are in that position as all commodities especially oil and gas prices have fallen off the cliff.

DYI 

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