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Switzerland should join the euro

Corrects story to reflect that the Swiss National Bank accumulation of euros includes currency acquired before the central bank started defending the 1.20 francs per euro level in September.

WASHINGTON (MarketWatch) -- With all the trouble engulfing Europe, which genius has poured roughly $300 billion into the euro?

Raise your hand, Thomas Jordan of the Swiss National Bank. The plan, initiated in September by now-disgraced ex-chairman Philipp Hildebrand and continued by his successor, is to keep the Swiss franc from appreciating too much, in the face of an avalanche of demand from investors seeking refuge from euro-zone woes. Read more on Thursday's SNB decision.

The SNB set its line in the sand at 1.20 francs per euro. And, basically, that's where the currency has stayed.

Success? Well, not really. As a terrific article in SmartMoney this week pointed out, if the SNB's policy were successful, they would have scared hot-money investors away from owning francs.

That's clearly not the case. The SNB itself says even at the 1.20 level, the franc is too strong.

And it's had an impact. Switzerland's not Greece, but exports are starting to suffer, plummeting 4.9% on a year-on-year basis in April after a 3.6% slide in March. A manufacturing purchasing managers index tumbled to 45.4% in May (readings below 50% indicate contraction.)

Retail sales dropped 2.9% in April.

To be sure, the euro-zone economy also is skidding, so that's clearly having an impact -- probably more -- than an artificially strong currency.

But it sort of proves the point. Switzerland fits the euro-zone economy like a glove. Why not join it, and end this silly and dangerous policy?

There is, of course, the small matter that Switzerland is not actually in the European Union, and thus, ineligible per current rules for the currency. Then again, the EU is rewriting its rules seemingly by the day. One more surely can't hurt.

Some countries, like Greece, are strangled by their euro-zone membership. Switzerland may be the rare case of a nation hurting by its absence.

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