The Swiss are doing what is in their best interest, and they don't mean any harm to Europe, but nonetheless their actions are causing great damage.
Here is what is happening: European investors are nervous about holding euros and don't want to buy dollars, so they buy Swiss francs ("CHF"). This causes the value of the CHF to rise compared to the euro, which makes the Swiss economy uncompetitive (and also hurts people in Hungary and other countries who took out mortgages in francs). So the SNB reacts by printing more francs and buying euros with them. So far so good. However, the Swiss are worried about the value of the euro going down, so then they sell the euro and buy other currencies such as the dollar and yen. This causes the euro to drop even more and the Swiss have to print more francs. The Japanese also react by doing the same thing - printing more yen and buying dollars.
The result is that there is constant selling pressure on the euro and the Swiss don't even benefit, because now they either a) are left holding the bag on a depreciating currency or b) end up monetizing the US debt.
Oy, foiled again! All hail the almighty US dollar! Even the Swiss bow down before it.
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Update:
"Switzerland is rapidly turning into a large
hedge fund with a small country attached.
At issue is not the SNB's ability to fund - it
can - or the near-term benefits, but rather what happens if things go
terribly badly in the euro zone.
The worse things get the heavier the flows of euros in Swiss coffers
will be, and the more disastrous, and pointless, the losses if ever the
currency union comes asunder. At that point, or sometime in the run-up,
the SNB will blink, as everyone understands they will, and choose to
crystallize their losses rather than add to them."
--http://www.reuters.com/article/2012/08/02/column-markets-saft-idUSL2E8J1FCA20120802
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