Economy

Capping The Franc: A Daring Move In Zurich

Op-Ed: In a surprise move, Switzerland’s central bank has de facto linked the country’s currency to the fate of the euro. Risky as it is, the bold move is welcomed in a country increasingly united by a common fear of recession.

Swiss francs (Radar Communication)
Swiss francs (Radar Communication)
Wolfgang Koydl

ZURICH - Theatricality, drama – any extravagant display of feeling -- is certainly not a Swiss thing. So while the news this week that the franc would be capped at 1.20 against the euro produced gasps of surprise on international financial markets, the Swiss National Bank made the announcement with barely more than a nod of the head. The step was courageous. It was also necessary.

It has to be the most understated move of the year, because the daring maneuver on the part of the central bank's Governing Board and its chairman Philipp Hildebrand has propelled Switzerland into an economic adventure -- the outcome of which is anything but certain. Strictly speaking, the Swiss did not couple their currency to the euro. What did happen, however, is that Switzerland‘s fate just inched a little closer to that of the EU and its joint currency, without the Swiss gaining any greater say in policy.

That means that henceforth, whether prices in Switzerland rise, pensions fall, interest rates go south, or rents skyrocket: it will all depend just that much less on independent measures, decisions, or resolutions taken in Bern or Zurich. The determining factor at the end of the day will be the course of the euro's rollercoaster ride on global financial markets – and that can't be calculated ahead of time. Or, to choose imagery a little closer to the Alpine nation: it's as if an experienced Swiss climber who, up to now, had the mountain to himself is now scaling with his rope tied to a bunch of tourists wearing T-shirts and sandals.

At this moment, the Eurozone is relatively quiet, and currency markets have set the value of the single currency against the franc exactly where Switzerland's bankers want it. But what happens if there are new catastrophes down the road? What if Greece goes bankrupt, Germany doesn't want to pick up the tab anymore, or a major European bank goes under? Is the dam the Swiss have erected strong enough to hold? Or will a stampede of speculators flock to the secure franc despite attempts by Switzerland's currency watchdogs to scare them off? The daily volume of euro-franc transactions is worth $72 billion. If there were to be a stampede, the Swiss National Bank would have to come up with astronomical sums to buy weak euros – day after day, for an unforeseeable length of time.

Theoretically, and probably practically as well, the Swiss National Bank could stand up under the pressure for quite awhile. They would just have to mint ever increasing amounts of francs and flood the market. The consequences of that, however, would be inflation -- and since price rises would be, so-to-speak, imported from the unpopular EU, that would not make the issue any easier to deal with politically on the home front.

Right now, the country stands behind its currency watchdogs. "Relieved" are not only companies, but also business and commercial associations, which were having trouble selling their products abroad because of the strong franc. "Satisfied" are also the Greens, Social Democrats -- and unions, because employees are increasingly being asked to work more hours or take pay cuts in exchange for companies not pulling up stakes and moving abroad where labor and materials are cheaper.

The fear of a recession unites the nation. Some may perhaps derive a frisson of self-importance at the idea of their small country all alone against powerful financial markets. Secretly, they‘re a little scared. But of course they'd never show it.

Read the original article in German

Photo - Radar Communication

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Society

Dutch Cities Have Been Secretly Probing Mosques Since 2013

Revelations of a nationally funded clandestine operation within 10 municipalities in the Netherlands to keep tabs on mosques and Muslim organizations after a rise in radicalization eight years ago.

The Nasser mosque in Veenendaal, one of the mosques reportedly surveilled

Meike Eijsberg

At least ten Dutch towns and cities have secretly used a private agency to probe mosques and other local religious organizations, Amsterdam-based daily het NRC reports in an exclusive investigation.

The clandestine operation — funded by NCTV, the National Security Services, the Netherlands' leading counter-terrorism agency — was prompted by the social unrest and uncertainty following multiple terror attacks in 2013, and a rise in Islamic radicalization.


The NCTV, which advises and financially supports municipalities in countering radicalization, put the municipalities in touch with Nuance by Training and Advice (Nuance door Trainingen en Advies, NTA), a private research agency based in Deventer, Netherlands. Among the institutions targeted by the investigations, which came at a cost of circa 500,000 euros, were the Al Mouahidin mosque in the central Dutch town of Ede, and the Nasser mosque east of the city of Utrecht, according to NRC.

Photo of people standing on prayer mats inside a Dutch mosque

Praying inside a Dutch mosque.

Hollandse-Hoogte/ZUMA

Broken trust in Islamic community

Unlike public officials, the private agency can enter the mosques to clandestinely research the situation. In this case, the agents observed activity, talk to visitors, administrators, and religious leaders, and investigated what they do and say on social media.

All findings then wound up in a secret report which includes personal details about what the administrators and teachers studied, who their relatives are, with whom they argued, and how often they had contact with authorities in foreign countries, like Morocco.

Leaders of the Muslim organizations that were secretly probed say they feel betrayed.

It is unclear whether the practice is legal, which is why several members of the Dutch Parliament are now demanding clarification from the outgoing Minister of Justice and Security, Ferd Grapperhaus, who is said to be involved.

"The ease with which the government violates (fundamental) rights when it comes to Islam or Muslims is shocking," Stephan van Baarle, member of the leftist party DENK, told De Volkskrant, another Dutch newspaper.

Leaders of the Muslim organizations that were secretly probed say they feel betrayed. Hassan Saidi, director of one of the mosques investigated, said that the relationship with the local municipality had been good. "This puts a huge dent in the trust I'd had in the municipality," he told the Dutch public broadcaster NOS.

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