Sunday, November 30, 2014

Bloomberg: Exit Polling shows Swiss Voted Against Gold Referendum

Bloomberg is reporting that the Swiss have voted down the Swiss Gold Initiative by a margin of 78-22 per cent. Below the text of the story is pasted. Here is a link to the Bloomberg report. It appears the vote margin is based on exit polling done by Swiss TV covering the vote.

"Swiss voters rejected a referendum requiring their central bank to hold a portion of its assets in gold, a measure its President Thomas Jordan termed an “invitation to speculators” that could have hamstrung the economy."
"The proposal stipulating the Swiss National Bank hold at least 20 percent of its 520-billion-franc ($540 billion) balance sheet in gold was voted down by 78 percent to 22 percent, according to projections by Swiss television SRF as of 1:00 p.m. local time. The initiative “Save Our Swiss Gold” also would have prohibited the SNB from ever selling any of its bullion and required the 30 percent currently stored in Canada and the U.K. to be repatriated. Polls, including one by gfs.bern, had forecast the initiative’s rejection."

Rueters also ran this similar story based on the same Swiss TV exit polling projections.
Added comments: If the final vote margin is close to 78-22 it will mean that the Swiss banking establishment was able to successfully persuade voters during the campaign because very early polling showed voters were in favor by 44-38 per cent. Later polling showed the vote failing, but by a much smaller margin.
The impact of the vote on the price of gold is unknown since gold never appeared to rise in anticipation of the vote. Kitco covers that aspect of the story here. And here is a later update
after gold bounced back up strongly.

Proponents of this initiative were probably overly optimistic about how the general public views this topic. I think there at least a couple of reasons for this. One is that the general public really does not think much about the monetary system of their country in the first place. There is mostly apathy on this topic as this vote indicated with a very low voter turnout. Secondly, those who believe in an actual gold standard are mostly older people. They recall a time when more of the general public believed in this type of monetary system. However, now there are very few people under 50 years old who have ever lived under a monetary system where either gold or silver backed the currency. Most people now have very little experience with that type of monetary system.

We see this illustrated with the younger generation being fascinated by Bitcoin. This is part of what we cover here because how the public views things is an important part of staying informed and being prepared for monetary system change in future. As we have noted here, that change can take many forms and the timing is unknown. We will try to keep readers here informed as best we can. A good plan is flexible enough to adapt to however things change in the future. We will talk about how silver can work well in that plan in an upcoming blog post later this week.

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