Showdown Time: Swiss Bank Tells Clients to Sell U.S. Assets or Leave

Oldest Swiss Bank Tells Clients to Sell U.S. Assets or Leave
(9/2/09 Bloomberg) [emphasis is mine]

"Sept. 2 (Bloomberg) -- Wegelin & Co., Switzerland’s oldest bank, is telling wealthy clients to sell their U.S. assets, or switch banks, because of concerns new rules will saddle investors with tax obligations in the world’s biggest economy.

"U.S. proposals to extend reporting requirements for banks whose clients buy American stocks and bonds coupled with estate tax liabilities that may be inherited by the heirs of people who have such holdings prompted the advice from the St. Gallen, Switzerland-based bank, said Managing Partner Konrad Hummler.

"“We came to the conclusion that it’s a threat to our clients,” Hummler, who is also president of the Swiss Private Bankers Association, said in an interview yesterday during a conference in Zurich. “It’s also a threat to us as a bank because as a custodian we are an executor to the estate. We find this aspect discomforting, so we recommend selling all American securities whatsoever.” "

""If a client decides to keep his U.S. investments, “then finally he has to change banks,” Hummler said. "

According to the article, the bank, for now, is considering using European-made derivatives and index funds that have exposure to American market. The bank manages more than 20 billion Swiss francs ($18.7 billion) in client assets.

This is on top of the news that Hong Kong is pulling their physical gold holdings from London back to Hong Kong to be stored in their newly constructed gold vault. (I read the news and commentary at Gary North's Specific Answers - paid site- but the news link itself is here.)

I have read about persistent rumors in gold-related sites that Germany and some nations in Middle East are demanding their physical gold back from London and New York.

It looks like a showdown time is fast approaching. A sudden huge-volume breakout in gold, silver, and gold/silver mining stocks in the last two days may be a harbinger.

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