Economy
In reply to the discussion: STOCK MARKET WATCH -- Tuesday, 20 March 2012 [View all]Ghost Dog
(16,881 posts)... The pursuit of UBS by U.S. tax authorities has opened floodgates to attacks on other Swiss banks that threaten to tear down the bastion of secrecy. UBS and Credit Suisse Group AG (CSGN), the countrys second-largest lender, also are facing stricter capital and liquidity rules forcing them to shrink more and faster than international rivals.
Its a really historical moment, Tobias Straumann, a lecturer in economic history at Zurich University, said in a phone interview. Its the first time that we have an open discussion on both of the issues. We had two external shocks: one economic and one political.
Switzerland Bleeding
The blows already are bleeding through to the economy. The banking industrys contribution to economic output in the country shrank to 6.7 percent in 2010 from 8.7 percent in 2007, according to Swiss Bankers Association data. Thats still a bigger share of gross domestic product from banks than in the U.K. or the U.S. More than 40 percent of that comes from wealth management, making it the industrys most important business.
Switzerland is the biggest manager of offshore wealth in the world, with about a 27 percent share, according to the Boston Consulting Groups 2011 Global Wealth report. Clients from Germany, Italy, Saudi Arabia, the U.S. and France make up about 42 percent of all offshore wealth managed in the country, the report said.
Should Switzerland abolish banking secrecy, it could risk losing as much as 700 billion francs ($768 billion) in the worst case, or about half of all money managed by Swiss banks on behalf of private clients not domiciled in the country, said Teodoro Cocca, a professor of wealth management at Johannes Kepler University in Linz, Austria. Such a shock would be enough to put the country into a recession, according to a study by Banu Simmons-Sueer at Zurich-based KOF Swiss Economic Institute....
/Much detail at link... http://www.bloomberg.com/news/2012-03-19/swiss-secrecy-besieged-makes-banks-fret-world-money-lure-fading.html
To where would much of this (1%-ers) "private wealth" flow? Why, to the so-far (of course) un-beseiged British-run offshore tax havens such as those in the Caribbean and the Channel Isles...