The Swiss National Bank has just announced that it is putting a ceiling on the franc’s appreciation against the euro… effectively abandoning its economic sovereignty and putting its future in the hands of woefully corrupt and incompetent bureaucrats.They have decided to jump off the cliff with the rest of the lemmings instead of defending their sovereignty and saving their own economy from a fate like those who have collapsed before them.
Don't tell me no one else saw this coming?
On the news, the franc fell off a cliff, dropping almost 10% INSTANTLY. Gold priced in Swiss francs jumped from 1497 to 1620 per troy ounce, all in about 45 seconds.
Precious metals are now all alone as the only forms of sound money that are truly safe havens.
Just 6-weeks ago on July 27th, in a letter entitled “Should I buy gold at its all-time high”, I wrote:The US has already taken it's last step off the cliff, leaving behind the potential of returning to a simple system of economics that could be sustainable. Either way, the US was going to slip into that good night with the rest of the world. The question that each nation and region must answer is how hard they will fall.
“Even stronger currencies like the Swiss franc have limits to their appreciation. At some point, the Swiss National Bank will impose capital controls to thwart the rise of its currency. . . [Y]ou’ll probably feel like a sucker for not buying gold at $1600 when you still had the chance.”
Since then gold has soared roughly 20%, and as of this morning, the SNB has imposed capital controls to thwart the rise of its currency.
This is just the beginning.
The Swiss government has basically told the world that they will print as much money as it takes, and buy up as much crap sovereign debt as they can, to competitively devalue the currency.
This essentially puts Switzerland in the same sinking boat as Italy, Greece, and Portugal… with one key difference: Switzerland has 0% interest rates.
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