The Economics of Swiss Franc's Float
A Swiss watch or vacation in Zurich is going to cost you much much more.. The more I read, more I feel like I should have taken a Swiss trip before the this float decision Much has been written about this. For a good introductory read, you can check the Mint article . Most of the literature of this decision has focused on the macro underpinnings. While it is true that the macro factors forced SNB to take this decision, I think it is important to understand the micro-economic implications of currency pegging & its aftermath Switzerland is a country known for its political stability. It stood insulated from even the world-wars. Such a place , coupled with its banking laws naturally has an appeal for black & white money from risk averse people across the world. The currency pegging was introduced by SNB to protect the economy from the global financial crisis. For a country, preventing appreciation of currency is quite easy -- Just print more money. Th...