Swiss Bank: The U.S. Overestimates its Attraction as a Financial Center; Advising its Clients to Get Out of All U.S. Securities
August 27th, 2009Crackpot, foilhead , lunatic fringe Swiss banks! *snort*
Via: SwissInfo:
Swiss private bank Wegelin announced on Tuesday that it is to stop doing business in the United States.
The St Gallen-based bank, Switzerland’s oldest, said the decision had been taken in response to stricter measures introduced in the US against tax dodgers and planned changes to estate tax, which would make some non-US citizens liable to tax if they inherited US securities.
In a letter to investors it said Swiss banks were likely to find themselves in an untenable position, as they would be expected to know which clients were liable to pay US tax – “an impossible undertaking”, given the lack of clear definitions in the matter.
The danger of inadvertently making false declarations to the US tax authorities will be too great, it explained.
It added that it believes the US overestimates its attraction as a financial centre, and is advising its clients to get out of all US securities.
The decision comes a week after US tax authorities reached a deal with the Swiss government which will see bank UBS hand over details of almost 4,500 suspected tax cheats.
They are just bitter over having their tax haven invaded.
I doubt it was news to any of their investors that U.S. securities weren’t the smartest route. They just want them to take out whatever part of their basket is left in the U.S.
Saying this out loud is just their way of fighting back, but I doubt they made this declaration because of any economic reason. Although this declaration itself will probably lead to the economic repercussions they are warning about, which is exactly what they want.
And moving forward it will help to form opinions on how the global economy will be structured. They aren’t the first to voice derision at U.S. dominance. But they are the first Western institution to do so.
Swiss private bank Wegelin in St. Gallen – thats not the multinational behemoth like UBS is.
They just use this medial window to promote what any sane investor would do: Save what you can and run, run for the hills.
I know several ppl working at private banks and they try to understand what a crap-dollar means for their business. It is hard to switch attitude that came during the last century, praising america as the idol of everything. Banks think ahead (most of the time) and others follow and if they succeed, those are the new financial elite.
You all here do not watch Swiss TV. There is this segment called “Cash TV”, which featured Mark Faber, hm, six times? Mostly around 2002, when i was still in school. He firmly advised everyone “to stay out of the western bubble and invest in sound and stable asian business”. Like something that can’t just explode in prices and produces wealth for all, so that everyone gets its share. So, no, this bank isn’t the first institution doing it. It is the first institution doing it when the world listens. And that matters today.