Foul Franc

swissnationalbankThe sudden decision by the Swiss National Bank to allow the Franc to freely float against the euro not only destroyed the SNB’s credibility, resulted in huge losses on its euro-bloated balance sheet and unleashed deflation in Switzerland, but also led to the insolvency of a number of foreign-exchange brokers. Despite extensive regulatory efforts to strengthen the financial system, financial activity migrates to unregulated parts of the system.

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