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.