Banking on gold price rebound, Swiss aim to remain gold center

The Bahnhofstrasse may not be exactly paved with gold, but chances are tourist feet pound over vaults crowded with the glittering metal.

Allowed a peek at the underground treasure trove of Zurich's oldest bank, the 227-year-old Bank Leu at Bahnhofstrasse 32, I ventured an indiscreet question: Just how much of the stuff was there?

Leu general manager Hans Surber allowed you to feel, weigh, and carry it. But Swi4ocretion banned a discussion of numbers and names.

Since 1968, when London was forced to abdicate as the world's No. 1 gold center because of currency turmoil and a weak pound, Zurich has been the major center for the bullion trade.

Led by the ''Zurich Gold Pool,'' a trading agreement of the country's Big Three, Union Bank of Switzerland, Swiss Bank Corporation, and Credit Suisse, banks here through the 1970s controlled some 70 percent of the world's total new production of gold. Packed with the metal, jets flew weekly into Zurich from South African and Soviet transit points.

Now, 14 years after Zurich's bankers slipped into the gold slot, all is not so calm in the vaults under the prosperous Bahnhofstrasse.

Though still the world's top trading center for major producers such as South Africa and the Soviet Union, the Swiss city has lost considerable gold clout. It now handles only around 50 percent of the African republic's gold output, and the USSR is also channeling considerably more of the metal through other outlets.

''If small Switzerland has 50 percent of South Africa's gold sales, we should be happy,'' Union Bank of Switzerland's general manager, Robert Studer, once commented. But the banks do not want less and they are bent on seeing that that does not happen. A strategy for the 1980s is being prepared in anticipation of gold's revival.

If there is one thing Swiss bankers agree on, it is that gold may stay relatively low in the short term (it sold here recently for $352 an ounce) but in the long term it will rise back to the glory days in 1980 when the price went over $800 an ounce.

Why? Credit Suisse economic adviser Hans J. Mast sums up: Potential gold buyers, who in the past came predominantly from the well-to-do, now include broad sections of the population in the industrialized and developing worlds; central banks are more interested in gold as a reserve asset; private ownership of gold is subject to fewer official restrictions today.

It is this greater interest in gold that has caused the Swiss banks to lose their undisputed dominance in the gold market.

First, the United States futures markets - New York Commodity Exchange and the International Monetary Market - hit them hard. The Zurich bankers woke up one morning to find that they were no longer setting the price of gold through the bullion market, but it was happening in New York and Chicago.

Without any restriction of actual physical delivery, speculators were shooting the price up and down governed by no rules of gold's supply and demand.

Compounding the problem, competitive physical gold centers have shot up. London has been back as Zurich's top competitor for some time. New York, Luxembourg, Hong Kong, and Singapore are well along in the gold race. Japan may not be far behind as enthusiastic buyers take advantage of that country's recently liberalized attitude toward the barbaric relic.