problems relating to the deterioration of coinage were a recurring theme in the legislative assembly. the hopeless confusion resulted in mix - ups, hampered trade and travel, and meant that capital remained idle. 5 sixty years later, however, in 1890, the swiss multiple currency period was already past history. nevertheless, swiss monetary history had remained eventful. since 1850, the swiss franc had been defined in terms of silver, in line with the french franc, and after 1860, it was also defined in gold. 6 at the same time, foreign money was still in use, in the form of coins worth their face value. unlike the situation in 1830, banknotes played an important role in payments transactions in 1890 ( if not, perhaps for buying bread ), partly because coins are unpractical for larger transactions. by now, the federal banknote act of 1881 had come into effect. this legislation included provisions requiring the 29 issuing banks to hold at least 40 % of their banknotes in circulation in the form of currency metal. in other words, banknotes were a kind of cash substitute and did not qualify as legal instruments of payment. 7 since banks did not gear their banknote issue to fluctuations in demand, there were regular bottlenecks in supply on days when large numbers of bills had to be paid. our next leap in time takes us to the year 1950. by now, only swiss coins and banknotes issued by the snb were in circulation. the confederation had transferred the exclusive right to issue banknotes to the snb, which began business operations in 1907. switzerland had been incorporated in the bretton woods fixed exchange rate system created in 1944, which was based on the us dollar as the lead currency – but ultimately on gold, since a fine ounce of gold was equivalent to precisely usd 35. however, for private individuals it had been impossible to exchange banknotes for gold at the snb since 1936. paul meier : der wahrungswirrwarr von der helvetik bis zur bundesverfassung, dissertation, berne 1951, p. 60. the true scale of the multiple currency confusion only became apparent 20 years later in connection with centralisation of the coinage system at federal level. at this point, in 1851 and 1852, following the introduction of the swiss franc, the old types of domestic coins were collected. a list of coins drawn up by the coinage commission featured 320 different coin types, although estimates came to as many as 86

philipp hildebrand : principles for sound compensation practices summary of a speech by mr philipp hildebrand, vice - chairman of the governing board of the swiss national bank, at the economic outlook 2009 ( unternehmer nw - schweiz ), basel, 23 april 2009. the complete speech can be found in german on the swiss national banka€™s website ( www. snb. ch ). * * * most financial institutions viewed compensation systems as being largely unrelated to risk management and risk governance prior to the crisis. short - term profits were rewarded with generous bonuses with little regard to the longer - term risks taken on behalf of the firm to generate those profits. with hindsight, it should therefore be no surprise that these bonuses fueled the excessive risk - taking that has ultimately undermined the global financial system. it is important for the future stability of our financial system that compensation systems be viewed as an integral part of the risk management system in financial firms, and designed and governed with this in mind. the financial stability board ( previously the financial stability forum ) has drafted a set of sound compensation principles for large financial institutions with exactly this goal in mind. the principles were endorsed by the g20 leaders at the london summit earlier this month and aim to be widely implemented by the 2009 remuneration round.