Friday, March 13, 2009

"You can't trust the Swiss, that's the bottom line,"

-Senator Carl Levin
March 3, 2009
What is up with the Swiss?
From this, a couple years ago: "Swiss in Liechtenstein 'invasion'", to this: "Swiss banker admits blackmailing BMW heiress" a couple days ago, it's the world turned upside down.

Now we read in Forbes:

Swiss Kick Off 'Currency War'

Switzerland's latest move to weaken the Swiss franc marks the first time in the current financial crisis that a G10 nation has intervened in forex markets to support a flagging economy. It is probably only a matter of time before others--notably Japan--follow suit....MORE
We are already seeing markets react: "Gold rises on Swiss central bank move"

The Mises Economics blog asks, "What's the Deal With the Swiss?":

Open thread to discuss what happened to the land formerly known as the Western Shangri La.

- Delinked from gold in order to join the IMF and settle Nazi-era court cases.
- Caved to the IRS and the Germans on withholding tax information on expats.
- The SNB continues to sell gold in accordance to the Central Bank Gold Agreement.
- And now they are intentionally devaluing their currency.

What are they drinking over there? Got bored of eating cheese and chocolate on the Paradeplatz?

I hope this will end the way Switzerland's 1980's invasion of Lichtenstein did.

The locals gave the Swiss troops cookies and cocoa.

It may not, however. In a cunning flanking maneuver, Lichtenstein put out this press release:

March 12, 2009

The Liechtenstein Declaration

Through this Declaration, Liechtenstein commits to, and will implement, global standards of transparency and exchange of information as developed by the OECD and will advance its participation in international efforts in order to counteract non-compliance with foreign tax laws.

With this Declaration, Liechtenstein clarifies its position regarding privacy and banking secrecy and confirms its readiness to speed up the negotiation of tax information exchange and other agreements with a view to having a network of such arrangements in place as soon as reasonably possible in order to address the global issue of tax fraud and tax evasion as well as double taxation. In this process, Liechtenstein will emphasise its responsibilities to address both the tax claims of other jurisdictions and the trust of its clients....

In purple ink! Take that, UBS.

UPDATE: Lichtenstein Wins! (Mutual Assured Destruction version of winning)

Switzerland caves in to pressure and signs up to tax-evasion fight

Switzerland has caved into the growing pressure on tax havens by pledging to co-operate with international standards on tax evasion.

In a landmark decision, the Swiss government said this morning it will adopt Organisation for Economic Co-operation and Development standards, which state that countries should work together on cases of suspected tax evasion....MORE