Swiss reject plan to hoard gold...and gold price plummets

Zurich (Dec 1)  Swiss voters have overwhelmingly rejected three citizen-backed proposals to protect the country's wealth by investing in gold, drastically limit immigration and eliminate a special tax that draws rich foreigners.

The separate proposals - put to voters nationwide on Sunday by conservative politicians, ecologists and a liberal group - had needed a majority of voters and Switzerland's 26 cantons (states) to pass.

A proposal to require the central bank to hold a fifth of its reserves in gold was opposed by 77.3 per cent of voters, according to final results from Swiss broadcaster SRF. It would have forced the Swiss National Bank to buy massive amounts of gold within five years, likely causing its global price to jump.

Finance Minister Eveline Widmer-Schlumpf said the vote reflects people's confidence in the SNB and the view that gold is no longer as important as it once was as a tool to back up paper money.

The SNB praised the outcome because it said the initiative would have "severely constrained" its ability to protect the country's interests through stable prices balanced with economic development.

A proposal to limit immigration to 0.2 per cent of Switzerland's population - about 16,000 immigrants a year for a country of eight million - was opposed by 74.1 per cent of voters. None of the cantons came out in favour. Currently, immigration is estimated at around 80,000 a year.

The "Ecopop" initiative would also have forced Switzerland to devote a large chunk of its foreign aid to programs aimed at reducing population growth in poor countries.

Andreas Thommen, a Green Party member who oversaw the campaign, told SRF it had been "a David and Goliath battle" against the establishment, and Switzerland "missed the opportunity to set the course for a sustainable future".

A third national referendum, which would have abolished special tax discounts for rich foreigners living in Switzerland, was also defeated. About 59.2 per cent voted against the measure, and only one of the country's 26 cantons said yes to getting rid of a flat tax rate that helps attract the super wealthy

Source: YahooNews