Let the banks fail.

At last, some action "In a lawsuit filedin New York, the Securities and Exchange Commission brought civilfraud charges against six former executives at the two firms,including former Fannie CEO Daniel Mudd and former Freddie CEORichard Syron. The executives were accused of understating the levelof high-risk subprime mortgages that Fannie and Freddie held justbefore the housing bubble burst."

http://www.guardian.co.uk/business/2...-third-quarter

Seems that 3 weeks before the euro peg/ceiling was introduced Hildebrands wife & daughter bought US£; lucky guess I suppose.

How safe is the NEWS we hear about the financial bank crisis?

Banks deposited a record €412bn (£343bn) with the European Central Bankover Christmas.The cheap ECB loans taken up by 523 banks last week came through onFriday and it appears they prefer to park the money back with the ECBrather than lend it on to other banks, thus injecting more liquidityinto the financial system.

I thought the banks were "supposed to" buy sovereign bonds with the money?

Moving the money round in circles does not help anybody unless the banks are earning from this_ poor banks deserve it

Yeah - some context IS definitely needed

• Both hubby and wife have a background in finance and worked for a well known hedge fund....
• .... where FX trading is as commonplace as the ubiquitous Kiffer in your average swiss bar
• The amount traded is literally peanuts in the FX world, where the average punter uses a 10x leverage ratio....
• .... and therefore Mrs. SNB-insider could have made a killing if she had *really* wanted to trade on the insider information...
• ...i.e. she would have purchased multiples of that amount ($500k)...

[but then again, maybe she did, on one of those dodgy trading software platforms... hmmm....]

Just trying to play devil's advocate, especially after listening to some un-credible jawboning from some Ticino politician who decried Mrs. Hildebrand's activity.

In my own view, had this trade been done by a politician with no prior experience or professional connections to the FX / trading world, it would have definitely raised my brows.

I am really more concerned that some radical hothead (i.e. the Bank Sarasin employee) decided what was "right" or "wrong" and spilled the beans (or brown nosed?) to El Jefe Supremo De La Derecha Suiça, Herr Blocher.
THAT, IMHO bodes very badly for the swiss banking secrecy (which ironically Mr. Blocher wants to preserve with all his forces...haha).

Out 'n' over

P.

__________________

When I was heading the treasury department of a small private bank in the Netherlands, I refrained from private fx or bond transactions. I have 10+ years of finance experience but did not consider the auxiliary risk of insider trading worth the small gain; and my income was far less than Hildebrands.

I agree that most traders use leverage and Hildebrand did not use any. But this does not eliminate the fact that they benefited from the transactions. I do not know whether they had traded FX before. If so it would support their innocence

Agree with some comments

Maybe options/leverage buying is forbidden by the SNB ethics code? I know it is now published but i did not find it or read it yet.

I think if the family Hildebrand had been smarter they would have hung onto the US$; I mean not sold immediately & if asked said something like we are planning to buy a holiday home - then after a few months they could have said - did not find anything suitable... That would have fixed the external perception.

As said, Blocher seems to have shot himself in the foot, again

Hm.
just *how* could you be doing "insider trading" in FX from your position in the treasury dep't (in a private bank moreover)?

Most banks I know of allow (or used to allow, I don't know how it is nowadays) FX, stock market transactions, as long as the employee does not waste too much of his productive time, doesn't become a pain in the butt of the traders, holds on to his position a minimum of x days, etc, etc.

What compliance / audit does *not * want is misappropriation of trades - i.e. the winning FX transaction is booked to the trader's account, the losing transaction is booked to the client.

But I digress.
In the SNB vs. Hildebrand case, the eventual "rules of engagement" should have been made it very clear from the onset what is and isn't allowed (and anyway we shall know within the next hours) - especially since both Hildebrands held high level professional positions within, let's call it the "speculative finance industry"...

Cheers

Paul

__________________

The system is not broken by accident, it's broken by design. The root of the problem can be found in the foundations of the monetary system, the fiat system that was put in place by a couple of smart families...and peasants around the world keep falling for the same promises by politicians of various parties that are funded by the same source and put in place for the same agenda.

There is more profit and more control in a "failing" financial system. We wouldn't have all those problems today if we had a free market as all the solutions brought to us by Government are distorting natural demand and supply cycles and we therefore have an economy that is unsustainable, built on a house of cards instead of sound fundamentals.

Addendum:
Price Waterhouse Cooper's "audit" of the alleged insider dealing (German)

And now back to the usual teeth gnashing criticism of the Banking System

P.

You may be interested in this interesting article on FT.com/alphaville, which cites another thought provoking post -"Why is finance so complex?"...

And yes I do agree BTW that the system is faulty, defective and opaque by design....

P.

I have now read the SNB ethics code, but in German. Legal German is not my speciality

So far as I understand holding derivatives is not allowed; as I suspected.
It is recommended (or mandated?) to hold portfolio items for at least 6 months which was not the case here.

back then we were trading a particular Emerging market currency heavily; mostly on behalf of couple funds which were sizeable in those days' standards

Prior to that I had participated in a joint bond purchase while informing all bodies in the front=back=audit chain by email but still received a lot of criticism.. which partly explains my reluctance to trading in a bank

Semih

The question is whether or not the wife had regular F/X dealings in support of her regular business activities.

If she had, then no problem - you could easily say it was just coincidence that she made a favourable transaction.

If she was dealing regularly in F/X (particularly involving CHF conversion) for personal gain then that's pretty bad practice given her husband's position ...

... and if this was an 'out of the blue' transfer made for personal profit then there are really serious questions to answer.


As regards bank secrecy, it seems like a rogue employee of the bank ratted her out, not the bank itself. That raises questions about the security measures taken by the bank to screen employees and the systems in place to keep information secret inside the bank itself. It doesn't call into question the general principle of bank secrecy being eroded.

__________________
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Member #14!

Bang on - the financial system may be failing the general economy and population but it's still working A-OK when it comes to funnelling ever more wealth into the pockets of the elite.

My guess is that they'll flog this dying horse right into the ground, then sit back and lie low somewhere safe during all the turmoil that follows and make sure they're right in on the ground floor of whatever new system gets built out of the rubble.

Sheesh... you sound just like one of those tinfoil Bilderberg watchers, you know ?

P.

Slightly off-topic, but it would be interesting to see what kind of success for example bitcoin or other virtual currencies will have in future if the old school banking sector is going downhill.

Hildebrand, head of the SNB, has just resigned.

Only news I could find on-line so far:
http://www.forexlive.com/blog/2012/0...brand-resigns/