Gnomes Of Zurich

DEFINITION of 'Gnomes Of Zurich'

A disparaging term used to describe Swiss bankers. Labor party politician George Brown coined the term in November 1964 during a meeting over the rapidly declining value of the British pound that was part of a currency crisis. British labor ministers were convinced that the foreign exchange speculation activities of Swiss banks were causing the devaluation of the sterling. The term came back into fashion in early 2010 when the global financial crisis created financial instability in Europe.

BREAKING DOWN 'Gnomes Of Zurich'

Zurich is the largest city in Switzerland and a major world financial center. Gnomes are mythical creatures that are said to live underground where they guard money. Swiss banks are known for their extreme secrecy, and they historically kept customers' deposits in underground vaults. Thus, the term "Gnomes of Zurich" came to describe Swiss bankers.

RELATED TERMS
  1. Currency

    Currency is a generally accepted form of money, including coins ...
  2. Exchange Rate

    The price of a nation’s currency in terms of another currency. ...
  3. Devaluation

    A deliberate downward adjustment to the value of a country's ...
  4. SIX Swiss Exchange

    Switerzland's primary stock exchange, located in Zurich. The ...
  5. UBS

    A multinational diversified financial services company headquartered ...
  6. Foreign Currency Effects

    The gain or loss on foreign investments due to changes in the ...
Related Articles
  1. Investing Basics

    Elves And Gnomes: Fairy Tale Investment Terms

    What do elves have to do with investing? Meet the fairytale creatures running around Wall Street.
  2. Options & Futures

    A Primer On The Forex Market

    Moving from equities to currencies requires you to adjust how you interpret quotes, margin, spreads and rollovers.
  3. Forex Education

    Currency Exchange: Floating Rate Vs. Fixed Rate

    Baffled by exchange rates? Wonder why some currencies fluctuate while others are pegged? This article has the answers.
  4. Economics

    The 2007-08 Financial Crisis In Review

    Subprime lenders began filing for bankruptcy in 2007 -- more than 25 during February and March, alone.
  5. Economics

    Understanding the History of Money

    Money has been a part of human history for at least 3,000 years, evolving from bartering to banknotes.
  6. Economics

    Lehman Brothers: The Largest Bankruptcy Filing Ever

    Lehman Brothers survived several crises, but the collapse of the U.S. housing market brought the company to its knees.
  7. Forex Fundamentals

    How To Calculate An Exchange Rate

    An exchange rate is how much it costs to exchange one currency for another.
  8. Investing Basics

    Rise of the Co-Investment in Hedge Funds

    Learn about the rise of co-investment deals among hedge funds. See how these high-risk and high-reward opportunities are becoming more popular.
  9. Economics

    3 Financial Crises in the 21st Century

    Take a look at several of the most prominent financial crises of the 21st century, and understand why the Great Recession was a truly remarkable contraction.
  10. Economics

    Explaining Too Big To Fail

    Too big to fail means that a business has become so large that its failure would have catastrophic economic repercussions.
RELATED FAQS
  1. What are the Gnomes of Zurich?

    The "Gnomes of Zurich" is a euphemism for Swiss bankers. The name is meant as an insult because gnomes, most often found ... Read Full Answer >>
  2. Which mutual funds made money in 2008?

    Out of the 2,800 mutual funds that Morningstar, Inc., the leading provider of independent investment research in North America, ... Read Full Answer >>
  3. Do negative externalities affect financial markets?

    In economics, a negative externality happens when a decision maker does not pay all the costs for his actions. Economists ... Read Full Answer >>
  4. What is the difference between disposable and discretionary income?

    According to the Bureau of Economic Analysis, or BEA, disposable income is the amount of money an individual takes home after ... Read Full Answer >>
  5. What are the major laws (acts) regulating financial institutions that were created ...

    Presidents George W. Bush and Barack Obama, in conjunction with Congress, signed into law several major legislative responses ... Read Full Answer >>
  6. What are the similarities and differences between the savings and loan (S&L) crisis ...

    The savings and loan crisis and the subprime mortgage crisis both began with banks creating new profit centers following ... Read Full Answer >>
Hot Definitions
  1. Socially Responsible Investment - SRI

    An investment that is considered socially responsible because of the nature of the business the company conducts. Common ...
  2. Inverted Yield Curve

    An interest rate environment in which long-term debt instruments have a lower yield than short-term debt instruments of the ...
  3. Presidential Election Cycle (Theory)

    A theory developed by Yale Hirsch that states that U.S. stock markets are weakest in the year following the election of a ...
  4. Super Bowl Indicator

    An indicator based on the belief that a Super Bowl win for a team from the old AFL (AFC division) foretells a decline in ...
  5. Flight To Quality

    The action of investors moving their capital away from riskier investments to the safest possible investment vehicles. This ...
  6. Discouraged Worker

    A person who is eligible for employment and is able to work, but is currently unemployed and has not attempted to find employment ...
Trading Center