Swiss Government Strikes Preemptively Against Glass-Steagall

June 9, 2023, 2022 (EIRNS)—The Swiss government (Bundesrat) commissioned a study on banking reform, including bank separation, by a team led by Prof. Manuel Ammann (in German) from St. Gallen University. (That’s like asking the landlord whether his wine is good. You already know what answer you are going to get, and how the wine is going to taste.) Ammann is an expert in derivative instruments, asset management, financial markets and risk management. Predictably, the study rejects bank separation, including with the fake argument that the risk of bank failures would be higher:

As economist Marc Chesney recently wrote, after the government-led fusion between the bankrupt Credit Suisse and UBS, the government is under blackmail by UBS, the only remaining too-big-to-fail bank in Switzerland.

The Swiss lower chamber, the National Council, is in favor of introducing bank separation, but the upper chamber, the Council of States, is against it, and can block it. However, there will be elections in autumn, and an ongoing popular initiative led by the Swiss People’s Party (SVP) could change the situation.