This weekend Switzerland is set to vote on 3 referendums, requiring the central bank to hold at least 20 percent of its assets in gold, a clampdown on immigration and abolishing tax privileges for foreign millionaires.
“If these initiatives get accepted, Switzerland will be at a turning point” said Patrick Emmenegger, professor of comparative political economy and public policy at the University of St. Gallen.
“Save Our Swiss Gold” was started by several members of the Swiss People’s Party, who argue that the Swiss National Bank was wrong to sell 1500 tons from 2000-2008.
This “Save Our Swiss Gold” initiative would require the Swiss National bank to build up its bullion holdings, which are currently at 8{92d3d6fd85a76c012ea375328005e518e768e12ace6b1722b71965c2a02ea7ce} of it’s assets. Michael Widmer, a Bank of America Anaylist, suggests that it could create a firm support at $1200/ounce, and could push gold above $1350/ounce!
If the vote is yes on this initiative we could see the gold community respond favourably to this. Small caps that were previously unfeasible over current prices could open up, as well as greater profits for exist producers.
More to come on these developments!