One of the main issues after UBS’ acquisition of CS is the question of what CS is still worth. and how the CS condition will affect UBS. If the public knew more about it, a problem of too big to fail could be discussed more seriously. UBS is currently in the process of finding answers quickly with internal and possibly external inspection bodies as well. You don’t hear about it in public.
One of the focal points is the evaluation of derivatives in which CS is involved. Infosperber has pointed out the importance of these papers in a series of articles. According to finance professor Mark Chesney, the face value of derivatives at Credit Suisse in 2017 was CHF 29.9 trillion. This figure exceeded the GDP of Switzerland by a factor of 36.
This value or exclusion of CS derivatives is one of the main risks that the Federal Government has to cover with the state guarantee of CHF 109 billion. It is not known to what extent federal agencies have secured CS screening insight.
Analysis is a daunting task. In the 2008 Wall Street crisis, the US authorities had to do the analytical work Black stone You must consult, today’s largest financial group in the world. It was only with the help of the major Black Rock bands that the US authorities were able to come up with bailout plans for the failed investment banks. Bear Stearns And Citigroup and a financial insurance giant AIG To engrave.
Big banks speculate highly abstract products in the billions. Transactions are very complex and require sophisticated computing power. But it is largely opaque. Major banks have outsourced a large portion of their derivatives trading to shadow banks that venture outside national and international regulations. If the bank goes into sharp decline, the state steps in.
Banking incidents have always been found somehow resolved over the past 70 years. But at what cost? The last super crash in 2008 led to major social unrest. Many countries still suffer from it.
PUK now
In Switzerland, politics and business are now wondering if the new UBS will not overwhelm the country. Helplessness reads between the lines and can also be seen on TV. This brings us to the question of the Patriotic Union of Kurdistan.
Yes, it needs a PUK. She must dissect CS like the corpse of a drowned man to find out how the mysterious deals were going. Especially with derivatives. And in proprietary CS trading. The PUK must have access to the results of the ongoing analysis by UBS. The PUK must conduct its investigations yet to be able to provide information to the public about whether the extravagantly speculative deals had any economic benefit at all. Or whether the majority of derivatives transactions – which is already evident – benefit only bonus recipients and shareholders.
More urgent is the question of what a (big) bank should look like in order for the state to free it from all-encompassing responsibility.
The banking lobby is sharpening its knives
The banking lobby is already heating up the old argument about competitive disadvantage and bringing it to the people. Strict regulations would hurt the Swiss financial position. Other banks and and and and will be affected. Just like after 2008 in the USA, Great Britain, France or Germany, when caring politicians (Merkel was there too) let themselves be afraid and fear for their banking positions.
One of the lobby’s nicest examples of this is the Hole Out Works by Dodd-Frank from 2010 by major US banks. New regulations should make “too big to fail” impossible in the future. president c. B. Morgan Chase He personally contacted more than a dozen members of Congress to provide the required countermeasures. And Citicorp He rewrote an important passage of the supposed Wall Street legislation himself. This is after the bank received $50 billion in bailout funds in the storm.
Also in European Union Fifteen years ago, hundreds of billions of tax dollars were poured into bailouts of troubled banks. In contrast, their speculative transactions should be highly restricted and taxed by law. But the financial lobby largely blocked the project – thanks to the International Banking Association IIF, headed by the Swiss Joseph Ackerman.
Was the situation different in Switzerland until now? no. Parliamentary transcripts of relevant debates in recent years can be read. Reading is particularly awkward for FDP. Current contact distortions fit this. The motto: “Wait and see if you can and don’t rush anything.”
Swiss bank lobby can be happy.
The author’s interest in the topic
no. Journalist and film director Urs Schnell has dealt extensively with the international banking system in recent years.
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The opinions expressed in the articles on Infosperber correspond to the author’s personal assessments.
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