On November 30th, the Swiss people will embark on a national referendum tackling three issues, one of which relates to gold. They will vote on whether their country's central bank (Swiss National Bank) should hold at least 20% of its reserves in the form of gold and also repatriate all existing Swiss gold held in the United Kingdom and Canada. This has been on the radar of almost all the gold bugs and gold, silver and financial sites have been talking about this potential move for weeks, if not longer. It should not come has a huge surprise that the Swiss central bank head, Thomas Jordan, is not in favor of any such moves as he believes that it would hinder his ability to conduct monetary policy moves. But it seems that the Swiss people definitely have something of a bone to pick with their government and the SNB considering the current economic climate and the latter's Euro peg, which as resulted in a huge increase in Euro holdings just as the Euro has weakened considerably against the US dollar.
Jordan actually expressed his concerns on the gold referendum at a church in Switzerland when he said:
"“The initiative is dangerous because it would weaken the SNB,” he said, speaking in the town of Uster, Switzerland. It “would make it considerably harder for us to intervene with determination in a crisis situation and fulfill our stability mandate,” he said."
The Swiss already own 1,040 tons of gold and would have to buy another 1,500 tons of the precious metal if the referendum passes in favor of holding gold in their reserves. The subsequent purchase would have at least a short term positive impact on the price of gold and could further exacerbate the paper gold vs. physical gold situation. This Swiss vote, the German on and off again repatriation, the Dutch repatriation of their gold and similar calls from certain French politicians are all making for interesting times in Europe.