Thursday, August 23, 2012

12-08-22 Central banks - US v Switzerland

Swiss National Bank 
Swiss National Bank, Bern

Linked below is a report from the Financial Times, regarding conduct of the Swiss Central Bank under the current crisis.  The Swiss have their own share of corruption. E.g.,  the President of the Central Bank has recently resigned, after it was discovered that his wife was secretly speculating on currency futures, based on his future actions relative to the SF exchange rate.

The most interesting part in the recent article was the following:

Swiss politicians are sensitive to their central bank's profitability because Switzerland's 26 cantons are its main shareholders. For the smaller cantons in particular, the SNB's dividends have been an important source of funds.
It appears that the Swiss Central Bank operates like a credit union, where the Cantons are the main shareholders, who benefit from the profits.  Obviously, if you read the full article, you learn that the Swiss Central Bank therefore is required to issue routine reports to the shareholders. 

One must wonder how the US managed for so many years to maintain a central bank owned and managed by bankers, under strict confidentiality, with no accountability to the People.

[1] Swiss central bank keeps critics at bay 

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