Mortgage Households As Carry Traders: The Social Life Of The Swiss Franc In Poland

The recent innovation of mortgage credit in Poland has been rearranging property relations, stimulating construction and enabling new middle class aspirations. There are more than 1.5 million active contracts; there exists no significant population who paid off. Half of those contracts are adjustable rate mortgages denominated in Swiss francs. They draw households into the currency market, making families de facto carry traders, betting on low LIBOR on the franc and a favorable exchange rate between the Polish zloty and the franc. "Franc people," as they have come to be known, enjoy the benefits of this speculation, but are also subjected to unprecedented risks. As the recent crisis attracted investors worldwide to the "safe haven" of the Swiss franc causing its strong appreciation, the mortgagors in Poland it saw a sharp plunge of equity on their houses and an increase in monthly payments. Based on ethnographic fieldwork this paper traces the dual productivity of the Swiss franc in Poland through the lens of the groupmaking effect of currency: "franc people, "or "currency spread generation." Economically, the franc is capable of producing independent effects that contradict the conventional wisdom that money is "just a veil" to economy. Symbolically, as a discursive site, or locus communis, the franc and its people become a vehicle of debates about postsocialist transformation, capitalist generation, instabilities of contemporary capitalism, and the legitimacy of speculation. What are the practices of domestic living with multiple currencies engaged through a complex and long-term contract? How do charts, exchange rates, and the LIBOR index become objects of attachment both in intimate household economies and in the public discourse at large? While based on the Polish case, this paper also uses data on the social life of the Swiss franc in Croatia, Hungary, and Spain for a more comparative and theoretical perspective.