Swiss referendum to take place June 10
Switzerland is toying with the idea of removing the ability of banks to increase money supply in a vote on sovereign money, or Vollgeld. The question will be put to a referendum on June 10 and polls show the 'no' side with a strong lead -- something like 49-35% among decided voters with the SNB taking a strong stance against it.
However in the post-Trump, post-Brexit era, no one is taking anything for granted and with four days to go before the vote, it's time to take a closer look.
Martin Wolf at the FT is out with an endorsement today on curious terms, saying that finance needs change and experiments. He says banks have lost the right to be the arbiters of money.
"The advantage of the Vollgeld proposal is that it is a credible experiment in the direction of separating the safety rightly demanded of money from the risk-bearing expected of private banks. With money unambiguously safe, it would be far easier to let risk-taking institutions bear the full consequences of their failures," Wolf writes.
He also considers different changes to the banking system that are possible, like letting depositors have accounts at the central bank.