The SNB pays dividends to the Swiss cantons. It has done so uniterruptedly for the past 100 years, however, in 2013 it couldn't make those payments.
Why?
Because it took a bath in gold. (Peter Schiff's favorite investment.)
This was posted on the BusinessInsider website.
So the people running the Swiss National Bank are even more stupid than I originally thought. Loading up on gold at the top or, near the top. You see the idiots running these institutions and by corollary, our freakin' lives?
4 comments:
What's funny of course is that the SNB can run with negative equity until the cows come home, or it can write out the negative equity with the press of a keyboard (Any entity where the balance sheet is denominated in its own liabilities can self-capitalise with a simple accounting journal).
Nobody can do anything about this, because the famed private shareholders are of course just recipients of the taxation distribution the bank charges as fees. They don't actually have any power to force the bank to close - it can only be liquidated by a federal act.
And the central bank is hardly likely to bounce its own cheques.
Of course if your ship has an anti-sinking mechanism and the captain doesn't believe in it, then you're still in trouble.
So perhaps they will bounce their own cheques. It's got to that point.
Nice metaphor: "Of course if your ship has an anti-sinking mechanism and the captain doesn't believe in it, then you're still in trouble."
Here is the April, 2014 speech by Jean Studer, the SNB President of the Bank Council, explaining, "A year without dividends and profit distribution – what are the reasons?"
http://www.snb.ch/en/mmr/speeches/id/ref_20140425_stj/source/ref_20140425_stj.en.pdf
Short SNB version, for the record:
http://www.snb.ch/en/mmr/speeches/id/ref_20140425_stj
Hey I know all that. Actually my professor Dr. Aloke Ghosh gave a speech on this issue. He also discussed some ways to overcome this problem. He is a very talented person. I always get help from him in my studies.
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