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  #241  
Old 30.09.2008, 23:19
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Re: How Safe is UBS

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Well, perhaps towards massive deflation? Great article by Bennet Sedacca on Minyanville who predicted which banks would get in trouble, months ago.

It will be interesting to know how Switzerland (and the franc) would fair in a deflationary environment. Since so many of the wheels here turn on financing, it could be bad.

http://www.minyanville.com/articles/.../index/a/19213.
Deflation is good for consumers. Already oil is cheaper. Other commodities will also fall in price.

Swiss exports, e.g. luxury watches, banking services, etc. target a wealthy clientele, who are not price sensitive. And everyone needs pharma in good times and bad.
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  #242  
Old 01.10.2008, 08:06
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Re: How Safe is UBS

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Deflation is good for consumers. Already oil is cheaper.
I recently saw a short speech of Lester Thurow - he mentioned that the oil producing countries like Saudi Arabia actually have an incentive to keep the price fluctuating and falling significantly from time to time - this way they can keep new producers (e.g. Canada) out of the market. Maybe that's what we are seeing right now?
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  #243  
Old 01.10.2008, 10:14
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Re: How Safe is UBS

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UBS is the most capitalized bank in Europe. So, in that respect UBS is quite safe.
Good that UBS is well capitalised as the papers are suggesting another few billion write off this quarter; between 3 & 5 B maybe. Anybody want to make a guess or a Book?

Marton
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  #244  
Old 01.10.2008, 10:32
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Re: How Safe is UBS

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Good that UBS is well capitalised as the papers are suggesting another few billion write off this quarter; between 3 & 5 B maybe. Anybody want to make a guess or a Book?

Marton
CHF 3 bid to CHF 5 offer seems good enough to me. Sorry about the two point spread but that's the bond market for you at the moment.
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  #245  
Old 01.10.2008, 10:34
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Re: How Safe is UBS

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Good that UBS is well capitalised as the papers are suggesting another few billion write off this quarter; between 3 & 5 B maybe. Anybody want to make a guess or a Book?

Marton
Three or five do not matter. Nine is the magical figure.
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  #246  
Old 01.10.2008, 10:50
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Re: How Safe is UBS

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....... if you own funds, stocks, bonds, etc. that are in your deposit account they would not be affected. .....
Sorry to drag up an old point but according to the Swiss papers some guy called Luqman Arnold is looking for his UBS shares that were lodged with Lehman. He has (had?) less than 3% of UBS so no big deal

& from the FT
"Investors in gold are demanding “unprecedented” amounts of bullion bars and coins and moving them into their own vaults as fears about the health of the global financial system deepen."

Marton
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  #247  
Old 01.10.2008, 11:02
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Re: How Safe is UBS

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Three or five do not matter. Nine is the magical figure.
Shorrick : Man of Mystery ... care to clarify ?

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  #248  
Old 01.10.2008, 19:00
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Re: How Safe is UBS

Irish deposit guarantee update: Ireland has now guaranteed for 2 years your entire deposits held in any irish bank (onshore).

France is already considering following suit.

Britian has raised concerns with the EU despite Gordon Brown stating he will do "whatever it takes" to shore up confidence in Financial institutions in the UK.

So if you're worried about the 30k CHF local guarantee, simply instruct UBS to transfer your funds to a Dublin based account in their Fund Services entity as follows:

http://apps2.ubs.com/locationfinder/...EntityTypeId=0

More info on the story here:

http://www.telegraph.co.uk/finance/f...guarantee.html
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  #249  
Old 01.10.2008, 20:13
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Re: How Safe is UBS

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Shorrick : Man of Mystery ... care to clarify ?


sarcasm, my friend, sarcasm

get used to it... there's going to be tons of it around next week
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  #250  
Old 01.10.2008, 20:57
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Re: How Safe is UBS

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Irish deposit guarantee update: Ireland has now guaranteed for 2 years your entire deposits held in any irish bank (onshore).

France is already considering following suit.

Britian has raised concerns with the EU despite Gordon Brown stating he will do "whatever it takes" to shore up confidence in Financial institutions in the UK.

So if you're worried about the 30k CHF local guarantee, simply instruct UBS to transfer your funds to a Dublin based account in their Fund Services entity as follows:

http://apps2.ubs.com/locationfinder/...EntityTypeId=0

More info on the story here:

http://www.telegraph.co.uk/finance/f...guarantee.html
Sorry but this is simply incorrect. The protection in Ireland only applies to Irish-owned banks. Last time I checked, UBS was still headquartered in Zurich.

http://www.irishtimes.com/newspaper/...724599017.html

You could transfer your cash to one of those 6 banks and then have 2 years protection guaranteed by the Irish government.
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  #251  
Old 01.10.2008, 21:05
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Re: How Safe is UBS

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Three or five do not matter. Nine is the magical figure.
Nine ...... Ouch
Definitely time for me to retire to my bomb shelter with my gold bars

Marton
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  #252  
Old 02.10.2008, 08:44
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Re: How Safe is UBS

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Sorry but this is simply incorrect. The protection in Ireland only applies to Irish-owned banks. Last time I checked, UBS was still headquartered in Zurich.
Looks like the irish are considering extending the backstop to some foreign owned banks. Whether UBS will have a sufficient enough presence in Ireland to qualify remains to be seen. This guarantee scheme is astonishing for such a small country to go it alone like this. Leaving aside whether it could actually make good on the promise it will cost Ireland (or more accurately it's taxpayers) dear when it goes to the markets to borrow.
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  #253  
Old 02.10.2008, 11:33
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Re: How Safe is UBS

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Leaving aside whether it could actually make good on the promise it will cost Ireland (or more accurately it's taxpayers) dear when it goes to the markets to borrow.
I suppose it is a question of maintaining confidence & hoping that because people are confident there will be no bank runs & so Ireland will never have to pay up?

Marton
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  #254  
Old 02.10.2008, 11:36
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Re: How Safe is UBS

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I suppose it is a question of maintaining confidence & hoping that because people are confident there will be no bank runs & so Ireland will never have to pay up?

Marton
Yes, that's how I see it.
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  #255  
Old 02.10.2008, 15:14
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Re: How Safe is UBS

I see it's crossing the wires that Northern Rock is now turning away deposits because it can't handle the stampede of savers looking to shelter under the government guarantee! No wonder Irish eyes are smiling!
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  #256  
Old 02.10.2008, 15:22
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Re: How Safe is UBS

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Shorrick : Man of Mystery ... care to clarify ?

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sarcasm, my friend, sarcasm

get used to it... there's going to be tons of it around next week
No sarcasm. Nine is the depreciation figure that drives capital below acceptable levels. That in turn will involve need for refinancing. The cost of which is and will be constantly going up unless UBS is very clear about what will happen to the IB (and no, axing 1000 people ain't gonna do it).
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  #257  
Old 02.10.2008, 17:27
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Re: How Safe is UBS

Seems Ireland's Euro partners aren't too happy with the Emerald Isle. It's put them on the spot. Gordon Brown has promised to do "whatever is necessary" and now folks are asking why he hasn't gone Irish. Meanwhile, with deposits flooding into Ireland the IHT asks if it was smart of the Irish to guarantee a bottomless bill. Seems to me it's self fulfilling event. The bigger their deposit base the better positioned these Irish banks are to ride out the credit squeeze....at the expense of their Euro "partners". Not very neighbourley but when your backs against the wall it's every man for itself and screw the rest of the European Union and it's "central bank". Ditto Northern Ireland. I'm a seller of Euros today.
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  #258  
Old 02.10.2008, 19:12
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Re: How Safe is UBS

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Yes, that's how I see it.
quite right ...
the whole point of the big bazooka is that you never have to use it
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  #259  
Old 03.10.2008, 01:26
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Re: How Safe is UBS

Ireland's move was more born out of desperation than some sort of cunning plan to grab bank business.

The Irish banks had loaned heavily to Irish homebuyers and more importantly, builders of residential and commercial property. The Irish property market is collapsing like the pack of cards it was and the banks were horribly exposed. Before the announcement there were very strong rumours of capital flight so this was very much a desperate measure.

Consider that it puts Ireland liable for debts of up to 200% GDP (probably more now that the scheme has been extended). Obviously they are hoping the debt never gets called but even so the penalty has been much higher rates on loans to the Irish government which will have long lasting and nasty impact on the country as a whole. Also, in the event of a catastrophic failure I have real doubts about the ability of the Irish govt to make good the guarantee.


The scary thing for Swiss Franc holders of course is that Switzerland just isn't big enough to bail out either UBS or CS ... so a failure of either of those two giants would trash the Franc. Currently it's doing rather well but I'm wondering if converting to Euro at this stage might be a better bet in case of Swiss bank problems?

I know that both the Euro and Franc are at highs vs Stg/dollar and are more likely to fall than rise but I'd still prefer to hold either as opposed to Sterling because I think we're about to see that currency crash badly. After it falls I'd be happy to shift to Sterling as that's where I intend to spend my savings (on a house).

The trick as ever will be timing.
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  #260  
Old 03.10.2008, 05:53
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Re: How Safe is UBS

...but it doesn't mean that an Irish bank won't fail although the guarantee will help them recapitalise.
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