At the Gates of Uncertain Freedom
The Swiss Insider 26.04.2020 #insidersdoitbetter
Dear Insider,
💐 Flowers are on the way. So is a haircut. 🎶 Happy days are here again…
Or are they?
The first steps towards a return to normalcy (in this un-normal age) will be taken tomorrow when a limited range of small businesses are allowed to re-open in Switzerland.
While most see it as a good sign, under the surface many are still wondering…is it too early? Is it too late…? How do we cope?
Roman Schwitter is one of many asking these very questions. His garden shop in Inwil is set to reopen tomorrow. But judging demand in such times is nigh unto impossible. Coop CEO Joos Sutter has a similar problem - how much to stuff into the warehouses in case the masses of newly released consumers stampede into the store to buy everything they couldn’t for the last six weeks?
The long-awaited freedom that so many have been longing for….suddenly becomes a scary proposition.
Every man and woman in his or her little castle, with the strong support of big brother banks and big brother Bundesrat suddenly looks quite nice, thank you very much.
Is this socialism a la Suisse in the making? And if so, will the population end up resisting or will the economy slip into “sustain in dependence mode”…?
While people take to the streets in the US to clamor for an end to social distancing, no such parades of protests are likely in Switzerland.
The only protest against the subtle shift (and potentially greater mix-up of personal freedom with state-sponsored economic sustainance) comes on the front pages of last week’s Neue Zürcher Zeitung with the headline - “Please, No Epidemia Socialism”
Meanwhile, the newspaper proceeded to pay out 8 million CHF in dividends to its shareholders - the same move that UBS, Credit Suisse and Julius Bär had shunned in the face of pressure from FINMA.
Apparently, newspapers value their financial freedom especially high…
The freedom to buy flowers and have short hair again (or not…the choice is yours…) will be, no doubt, gladly welcomed.
Whether a return to normal freedom comes at a premium, will soon be clear.
Beginning tomorrow…
🔍 The Scoop
Inside takes that don’t make the front pages of daily news…
📉 Swiss National Bank Drops Big-Time
If we all suffer, we all suffer. Some measure of (perhaps unwilling) solidarity is to be enjoyed. The Swiss National Bank this week reported a 38 billion CHF loss in the first quarter of the year.
❗️❗️The interesting part? According to the Financial Times, at one point the SNB owned more Facebook stock than founder Mark Zuckerberg. Interesting….
⌚️UBS’s Apple on the Watch
It’s not a scoop if everyone was expecting it…right? Or is it? After seemingly ages of deliberation, UBS seems to be on its way to integrating Apple Pay into its payments offering. Yes, Credit Suisse was first - not something that can be said so often for the smaller of the two twins. But then again - we can thank the Corona Digital Officer (CDO) for helping finally turn the screws and force UBS to give in to the contactless new world. (The less-known reason may also be the recent problems UBS has had with its own mobile systems…better to trust Uncle Tim Cook and company than rely on yourself and Twint?)
🙃 Swissquote’s Happy-Sad Times
The “original” Swiss online bank seems to be prospering under CEO Marc Bürki. In comparison to the venerable occupants of Paradeplatz, the funky, innovative bank has a fresh take on things - and plenty of fresh products to keep clients happy. Then….oil happened. As prices tanked, Swissquote was forced to close out one of its most popular products - the OILUSD, writing to clients on the spur of the moment to force them close positions ASAP. An abrupt announcement of trading suspension and…that’s it.
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The Brief(ing)
In which we boil down the stories of the last seven days - just enough to make them digestible…
🎫 Big banks, big loans
Credit in coronatimes is not only for small and medium businesses. According to SRF, UBS and Credit Suisse have seen a significant number of emergency loans of over 500 000 CHF granted. Despite its smaller size, Credit Suisse has so far come out on top, dispensing a total of 300 million Swiss francs, with a total of 90 credit lines extended.
🛢 Hot and Not Oil
The big drop in crude oil prices has hit the US economy hard, but does not seem to affect Swiss business quite as much. The exception? A falling price for heating oil (a drop of 20% since the beginning of 2020) has seen a sharp rice in orders. All the better for the people…
🍻 Bigger and better beer
The Swiss beer industry has been on a roll. With rising consumption (up 13% since 2000), a more diverse offering and an ever-increasing preference for Swiss varieties over imported beers, the numbers look good. Will corona give it a hit? Maybe - since the closing of restaurants and cafes has made it harder to enjoy in a group. Maybe not - if local producers figure out to deliver right to the door of their customers.
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The Numbers Game
All the numbers that matter in these troubled times…
😄 1,3 billion CHF
Happy smiles all around - Credit Suisse is off to a roaring start to the twenties… The first quarter of the year saw the smaller of Switzerland’s two big banks report a clean profit of 1,3 billion CHF. Not bad, not bad…
🗓 32 billion CHF
The bill is big. The latest estimates show that the direct cost of fighting corona in Switzerland will reach a whopping 32 billion Swiss francs. And that has nothing to do with big-time bailouts and credits.
🛑 56 000
Despite the current situation, Switzerland remains a popular spot - too popular in fact. According to Swiss customs officials, around 56 000 persons have been refused entry into the country since the imposition of border controls on 13 March. In the meantime, fines are being dished out with typical Swiss efficiency (150 per day), especially for those jumping over the border to Germany to do shopping. Maybe it pays anyway…?
😷 200
Although the number is nothing to be proud of, the general trend is, indeed, encouraging. Over the past two days, new cases of coronavirus infections (those reported and confirmed at least) have hovered around 200. A far cry from the level of a few weeks ago..