ZURICH, SWITZERLAND – Sonntagszeitung in Zurich has reported, citing an unnamed source, that Credit Suisse is handing over client data for 130 customers to the Swiss government, at the request of the American tax service, the IRS. The federal government, which has demanded that the bank turn over the names immediately, according to the Swiss weekly, will review the names and data, and provide them to the US tax authorities once it decides they meet the criteria required for Switzerland to provide administrative assistance to the US.
Swiss procedure allows the clients a chance to appeal, a process that could well mean it takes several months for the IRS to obtain the information.
Credit Suisse has so far not confirmed the Swiss weekly publication’s numbers. Last week it said it was informing clients who are affected by the move.
The Los Angeles Times looks at the absence of small investors when General Motors shares go on sale Thursday 18 November in an IPO (initial public offering) that follows GM’s 2009 bailout by the government. Washington owns 61% of the company after spending nearly $50 billion to keep it together and help it through bankruptcy proceedings. It is expected to reduce its holding to 43% according to the LA Times. GM has repaid some of the debt. The company announced Tuesday 16 November that it plans to raise $12 billion from the IPO, making it the second largest in US history, according to Bloomberg.
Mahmoud Ahmadinejad, president of Iran, told ABC television in the US that the American government forged and disseminated documents showing that Iran has planned to use uranium deuteride as a nuclear bomb trigger in a test. The report on the document, published 14 December by The Times, UK, is “fundamentally not true”, he told ABC interviewer Diane Sawyer.
Links to other sites: ABC interview with Ahmadinejad, US, BBC, Times, UK
The Bank of America will pay the US government $45 billion, the money loaned to it under the Tarp bailout plan. The surprise announcement Wednesday 2 December provides some relief for the federal government, which has been criticized for using taxpayers’ money to keep banks alive, only to see them turn around and pay large bonuses as they return to profitability. Bank of America is looking for a new CEO, and observers say paying back the loan will allow it to offer a better pay package, with less government pressure, but it also makes the bank more vulnerable to risk.
US citizens in Geneva, Switzerland with Ambassador Donald Beyer, centre back, 12 November 2009
Geneva, Switzerland (GenevaLunch) – A small group of Americans met informally with their new ambassador, Donald Beyer, Thursday 12 November, the first such meeting in Geneva in some 20 years, according to the members of American Citizens Abroad (an international organization based in Geneva) who participated. The discussions were wide-ranging and included:
The fall of New York investment bank Lehman Brothers in September 2008 will be remembered as the trigger moment that brought the world economy to its knees late last year. Media worldwide are using the anniversary to reflect on what happened, to interview the protagonists and, in the case of BBC2 TV, to air a docu-drama 9 September that recounts the story.
Lehman was so big in so many different markets that when the US government allowed it to go bankrupt, it caused a convulsion among its many counter-parties that caused the credit markets to seize up, and brought normal banking activity to a stop. One example: Reserve Primary Fund, a money market manager that put its investors’ money in safe, generally, low-yielding assets had to write down $785 million in Lehman debt that was worthless the day after it went bankrupt.
It was only the massive intervention by central banks and governments worldwide that calmed markets. There are still questions as to why other major investment banks were allowed to merge, or were given US government money to save them. The day after Lehman Brothers fell, the US Treasury, then still led by Henry Paulson, stumped up $85 billion to save US insurer American International Group. Bloomberg, MarketWatch, Vanity Fair (lengthy interview with former US Treasury Secretary Henry Paulson), Reuters (interview with Lehman ex-CEO Richard Fuld)
UBS New York headquarters
Update 2 Florida, USA; Bern and Zurich, Switzerland (GenevaLunch) – The bell hasn’t yet quite tolled for anyone in the US court case where the IRS is asking for names of UBS bank clients. Judge Alan Gold in Miami late Friday 7 August, Swiss time, gave the two governments another week, until 12 August and at their request, to hammer out details of an out of court settlement.
Reactions were mixed, with the Financial Times reporting that “Friday’s setback caused confusion” for investors, arguing that the “failure” to reach an agreement will hurt UBS shares. Swiss media were more phlegmatic, viewing the delay as an acceptance that a resolution of several technical issues requires more time, which the judge has given.
North Korea is coming under suspicion as the culprit in a series of major cyber attacks that began 4 July on South Korean banks and government web sites, as well as US sites, but some analysts question this and point instead to industrial spying or prankster hackers, Reuters reports, noting that “the attacks saturated target websites with access requests generated by malicious software planted on personal computers. This has overwhelmed some targeted sites and slowed server response to legitimate traffic.” AP, Time magazine
If there is one thing all political observers could agree on Wednesday following the election of Barack Obama as the 44th president of the USA, it is that his job will be more than challenging: the tasks are daunting. The include the first transition to a new government during wartime, overseeing a budget that has a $1.5 trillion deficit and working with other governments to end the global economic crisis. International Herald Tribune, National Public Radio,
