How Currencies Make Histories: Poland's Swiss Franc Decade (2005-2015)

This paper is an analysis of the social and cultural effects of the proliferation of adjustable-rate mortgages indexed to or denominated to in Swiss francs in Poland. The boom in foreign currency mortgages in Central and Eastern Europe has afforded the Swiss currency an unexpectedly central place not only in the everyday life of young urban middle class mortgagors but also in the broader public discourse and social imaginary. The currency was domesticated and created in big Polish cities a historically novel form of households, which continue to be positioned by the mortgage contracts as sorts of carry traders in the global currency market, but with no significant shield from the currency rate risk. While such households account for less than 2% of the population, “franc people” (frankowicze) have become an extremely visible group nationwide in representations ranging from journalism through TV and theater to hip-hop. Based on 22 months of fieldwork among those indebted in francs and on archival research and discourse analysis, this paper focuses on the dynamically changing relationship between Polish currency, the złoty, the Swiss franc, and the Euro. What are the uses and effects of speculative relationships to multiple currencies, which were supposed to address the housing need in the context of an enduring shortage of living space?

The analysis combines long-term ethnography (with fieldwork between 2012-2015) and historical analysis in order to track the shifting forms of productivity of the multiple currency dynamic through the years. Chronologically, it spans the time of foreign exchange mortgage boom (2006-2008), the withdrawal of fx mortgages from bank offerings after the crises of 2008, a series of public and private moments of reckoning triggered by sudden appreciations of the franc against the złoty (2009, 2011, 2015), and a set of civic, legal, and political processes in which the franc becomes a problem. Analytically, it moves between two scales in which the foreign currency gets domesticated: that of the household, where ethnography reveals the capacity of multiple currency dynamic to rearrange social ties and shift subjectivities, and that of the social imaginary, where discourse analysis reveals the capacity of multiple currency dynamic to generate representations, diagnoses, and judgments of phenomena like the postsocialist transformation, the future of the middle class, or westernization, and to incite debates around the moral economy in global and national markets. In both scales the Swiss franc becomes a powerful object of attachment, its value a public number of a quasi-totemic significance. I argue that multiple currency dynamic may generative, or productive, not only economically, but also socially and culturally. In the case of the franc this means that the currency not only mediates the risk-generating production of wealth through speculation on spreads and exchange rates, but also transforms social relationships in households, kinship networks, and cities, as well as enrolls old and generates new cultural meanings, which have the capacity to change the course of economic process.

The paper is organized into four parts. The first one, “The Swiss Franc Household,” describes households co-constituted by the Swiss franc. The second one, “The Social Production of Optimism,” reconstructs the anatomy of the mortgage boom. The third one, “Franc Crises,” tracks the responses to the rising exchange rate. The fourth one, “The Moral Economy of Currency Pairs,” analyzes the converging and diverging paths of moral discourses around property, risk, and the middle class on the one hand, and the market dynamics on the other. The paper seeks to contribute to the ongoing conversation in the Domesticizing Financial Economies miniconference series, by showing how a currency dynamic domesticated into household intimacies and national imaginaries may become a medium of historicity. It is harnessed for its worldmaking potential to construct entire quarters of the city; it is mobilized to position individuals, couples, and collectives in processes of modernization; it becomes a lens through which to judge historical time in terms of safe present, hopeful future, or “crisis.” By refusing the easy benefits of hindsight enjoyed by critics of fx mortgages this analysis will show how rather than just exist in time, morally embedded financial dynamics actively co-create the present for different actors as they revaluate the past and mediate the knowledge of the future.