Why should anybody keep all their cash in dollars? Why not diversify into euros and swiss francs or something else, especially if you believe (as I do) that the US dollar will depreciate.
From Wikipedia:
“The Swiss franc has historically been considered a safe haven currency with virtually zero inflation and a legal requirement that a minimum 40% is backed by gold reserves.[3] However this link to gold, which dates from the 1920s, was terminated on 1 May 2000 following an amendment to the Swiss Constitution.[4] The Swiss franc has suffered devaluation only once, on 27 September 1936 during the Great Depression, when the currency was devalued by 30% following the devaluations of the British pound, U.S. dollar and French franc. [5]”
Does anyone know why Switzerland stopped its gold link in 2000?
What is the best way to invest in Swiss francs (someone here recommended Swiss franc annuities recently but I can’t find the link now).
“Does anyone know why Switzerland stopped its gold link in 2000?”
The Swiss have been a very large seller of gold over the last several years. They wanted more interest on there CB reserves, so they sold gold and bought more euros, dollars, etc.
via bonds.
Here is a link to information about Swiss insurance and annuities.
And by the way, the actual reason the Swiss sold a lot of gold was to keep the Swiss Franc from going even higher due to its link to gold. No central bank sells gold to “make more interest”, even though they give that excuse. It’s either to keep their currency weaker than it would otherwise be (in this case), or to keep the gold price down (in most other cases).
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