Swiss Reject Radical Sovereign Money Proposal

Swiss voters dismissed a radical proposal to overturn one of the financial system’s core tenets.

The so-called sovereign money initiative, or “Vollgeld,” would have ended the system of fractional reserve banking that’s been around for centuries by allowing only the Swiss National Bank to “create” money. But 75 percent of voters rejected the measure, according to a projection from Swiss television SRF. Official results of the plebiscite are due later on Sunday.

No Experiments

Swiss voters rejected the Vollgeld proposal

Source: SRF projection

“Of course we’re happy,” said Heinz Karrer, president of business lobby economiesuisse.
“A large majority of the population didn’t want to go for such an experiment.”

While polls had suggested “no” was likely, the fact supporters were able to muster the 100,000 signatures necessary to put it on the ballot is testament to the ongoing distaste about the financial industry still palpable a decade after the financial crisis. While that was sparked by the collapse of Lehman Brothers, Switzerland didn’t escape, and was forced in 2008 to bail out UBS, its biggest bank.

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