Confidence vote today in the French National Assembly. Bayrou’s going down, it’s already over. The opposition parties announced they’ll vote against him, and without a majority, he’s toast. Fifth Prime Minister in two years for our neighbors. Watching from here, from our peaceful cantons, it’s a fascinating and slightly sad spectacle. France is stuck in an endless democratic crisis, this infinite loop where each government falls faster than the last one. While ministers in Paris pack their boxes every six months, here we quietly vote on our laws, our reforms, our popular initiatives. No drama, no votes of no confidence, no surprise dissolutions. Just citizens making decisions, period.

Our system is simple: 50,000 signatures and boom, you can challenge a law passed by Parliament. 100,000 signatures and you can actually propose a new law. No need to wait for a government to collapse to hope for change. Citizens have control permanently, not just during a presidential election every five years. Funny thing is, our governments last. The Federal Council consults, anticipates, seeks consensus. Because they know that ultimately, the people can say « nope, we don’t agree. » In France, they prefer the model of « we’ll ram this through by executive decree and see if it blows up. » Spoiler alert: it blows up. Every single time. Bayrou today, Barnier yesterday, and whoever’s next tomorrow.

This endless crisis of French democracy comes from this: a system where citizens are spectators of their own democracy. They vote, they go home, and they watch politicians tear each other apart for five years hoping things will somehow work out. Except it never works out. Voter turnout collapses, distrust sets in, extremists rise. Makes sense: when you have zero power between elections, you end up voting for whoever promises to burn the whole thing down. Here, that vicious cycle doesn’t exist. We win, we lose, we try again. We learn that democracy isn’t about waiting for some savior but working together on pragmatic solutions. No « supreme leader, » no « I was elected so I can do whatever I want. » Just collective work, boring but effective.

The real question today, while Bayrou’s already packing and the French are betting on the next disposable Prime Minister, is this: how many governments need to fall before they realize the problem is the system itself? Swiss-style direct democracy isn’t a magic bullet—actually, magic bullets are exactly the problem. But it’s a way to give power back to citizens without burning down highway toll booths. It transforms frustration into participation, anger into votes, « they’re all corrupt » into « okay, so what do we do now? » Because honestly, between watching the sixth Prime Minister of the year crash and burn live in Parliament and actually having a say in the laws that govern us, the choice should be obvious. But hey, watching from here, we’ve stopped expecting things to change over there.

Have a good week,

M. Hantale 🧀

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Top Stories

• 🇺🇸 Tariffs – Switzerland’s economy minister returns to Washington to negotiate the removal of a 39% surcharge on Swiss exports to the U.S.
• 🇨🇳 Global Governance – Xi Jinping calls for a new international order at the SCO summit, pushing for more inclusive governance against U.S. hegemony.
• 🇪🇺 Aviation Security – Ursula von der Leyen’s flight disrupted by suspected Russian GPS jamming near Bulgaria, forcing the crew to land using paper charts.
• 🇷🇺 NATO – Vladimir Putin conditions peace in Ukraine on a rollback of NATO enlargement.

Economy & Finance

• 🇭🇺 Inflation – Hungary’s inflation exceeds 4% in July, twice the EU average, deepening the country’s economic crisis.
• 🇪🇺 Inflation – Eurozone inflation accelerated to 2.1% in August, above ECB’s target and market expectations.
• 🇨🇭 Inflation – Swiss consumer prices rose 0.2% in August, stable for the third straight month despite U.S. tariff pressures.
• 🇪🇺 Jobs – Eurozone unemployment held steady at 6.2% in July, showing no major labor market improvement.
• 🇨🇦 Jobs – Canada lost 65K jobs in August, its sharpest decline since early 2022.
• 🇺🇸 Jobs – U.S. job openings fell to 7.18M in July, a rare low since the pandemic and well below expectations.
• 🇺🇸 Gold – Gold prices hit a record in London, nearing historic highs after Trump fired a Fed governor.
• 🇺🇸 Gold – Swiss refiners reject moving capacity to the U.S. to offset Washington’s new 39% tax.
• 🇺🇸 Debt – U.S. Treasury yields jumped, with the 30-year surpassing 4.97%.
• 🇫🇷 Debt – France’s 30-year yield topped 4.50%, the highest since 2011, amid political and budgetary uncertainty.
• 🇨🇭 Monetary Policy – The Swiss National Bank may cut rates back into negative territory as inflation remains stable.
• 🇨🇭 Real Estate – Switzerland’s reference mortgage rate drops to 1.25%, allowing many tenants to request rent reductions.

Switzerland

• 🇫🇷 Climate – France and Switzerland sign two accords to jointly manage Rhône and Lake Geneva waters amid rising climate risks.
• 🇨🇭 Digital Health – Switzerland to make e-prescriptions mandatory to boost patient safety and reduce medical errors.
• 🇨🇭 Event – The 6th Geneva Watch Days hits record attendance with the widest brand lineup since its launch.
• 🇨🇭 Reconstruction – CHF 100M to rebuild the village of Blatten, destroyed in May, with residents expected to return by 2029.
• 🇨🇭 Astronomy – Swiss amateur astronomer discovers a new moon orbiting an asteroid, hailed as a “sensational” find by scientists.
• 🇨🇭 Archaeology – Remains of a Roman bridge in Aegerten (BE), used for 400 years, reveal 300 oak piles and everyday objects dating from 40 BC to 369 AD.

Elsewhere in the World

• 🇮🇩 Protests – Over 3K protest in Indonesia against excessive MP allowances, prompting army deployment and office closures in Jakarta.
• 🇧🇷 Justice – Jair Bolsonaro’s trial opens on charges of plotting a coup and planning to assassinate President Lula after his electoral defeat.
• 🇵🇪 Corruption – Former Peruvian president Alejandro Toledo sentenced to 13 years for money laundering in the Odebrecht scandal, after already receiving 20 years for corruption.
• 🇺🇸 Defense – Trump wants to rename the Department of Defense as the Department of War, a symbolic move to project a more offensive military stance.
• 🇦🇷 Politics – Argentina’s Congress overrides a Milei veto for the first time, reinstating social spending for the disabled.
• 🇦🇫 Earthquakes – A third 5.6 quake strikes southeast Afghanistan within a week, as the first quake’s death toll exceeds 1,360.
• 🇬🇧 Government – Angela Rayner resigns as deputy PM after an ethics report on a tax case.
• 🇨🇳 Anti-Corruption – Former Chinese securities regulator head Yi Huiman investigated for “serious legal violations” after his 2023 dismissal.
• 🇪🇺 Supercomputing – Europe launches Jupiter, its first exascale computer, aiming to catch up with the U.S. and China in AI.
• 🇯🇵 Government – Japanese PM Shigeru Ishiba resigns after less than a year in office, his party losing its absolute majority in Parliament.

• 🇨🇭 Governance – Sudden shake-up at Nestlé as CEO Laurent Freixe is ousted over a code of conduct violation, highlighting strict Swiss governance standards.
• 🇨🇭 Private Health – Swiss Medical Network reports a 20% revenue jump to CHF 426M in H1, driven by newly integrated clinics.
• 🇨🇭 Private Banking – Lombard Odier opens new HQ in Bellevue, gathering 2,100 Geneva staff on a 60,000 m² campus.
• 🇨🇭 Governance – Nestlé replaces CEO after firing Laurent Freixe for concealing an affair, raising pressure on his successor to restore stability at the top.

Where Have All the Safe Haven Assets Gone?

United States, Germany, Japan: the safe haven assets we thought were eternal are cracking everywhere. Well, almost everywhere. Switzerland still stands firm against the global budgetary drift.

For decades, Washington could finance its debt cheaper than anyone else. That’s over. The dollar has significantly weakened in recent months, and 30-year Treasury yields have returned to levels not seen since… the 2008 financial crisis. A signal that’s unsettling, to say the least.

In Europe, even the champion of fiscal discipline is backing down. For two years now, Berlin has been changing course. Facing an energy shock that’s weakening its industry, German intellectual elites have opted for debt-fueled fiscal stimulus. In the rest of the eurozone, this strategy has mostly produced more debt (without real growth), but hey… it’s so much easier than implementing major structural reforms…

Then again, let’s be honest: since the ECB reduced its purchases, things haven’t exactly improved for Germany. They’re issuing more debt on the markets while no longer benefiting from the ECB’s captive demand that mechanically supported Bunds. Result: German bonds are losing their « special » status (just look at the black curve since late 2022).

This is the case for most so-called « safe haven » economies. Well, most, but not all. Because Switzerland still holds firm. Why? Simply because it’s one of the most fiscally responsible countries in the world (36% debt-to-GDP ratio), and it stays the course. Because let’s be clear: sustainably low interest rates don’t fall from the sky, they’re earned. What they reward is a sustainable debt trajectory, controlled interest payments, and superior shock absorption capacity. And because Switzerland is now almost alone in Europe in maintaining true safe haven status, the 30-year Swiss curve has literally plunged since 2023, falling back below 0.5% in recent months (see the red curve breaking away from the black one).

The lesson from recent months is instructive: in a world where deficits are exploding, true safe haven assets (gold, Swiss Confederation bonds) can be counted on one hand. Switzerland doesn’t have a magic recipe, just a 36% debt-to-GDP ratio while others flirt with 100%. The rest is just arithmetic.

— Mourtaza Asad-Syed

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Diversify your assets in Switzerland
Find out why nearly 2 million Europeans already keep a Swiss account.