Marky Mark on Switzerland

March 4, 2003

While Global Speculators are salivating over the coming Roman Candle move in the SOX, Switzerland is on the brink of crises:

"Shares in Swiss companies have taken a pounding because two of their biggest investors, Swiss pension funds and Swiss insurers were big sellers in 2002. Underfunded pension plans have had little choice but to dump shares. Swiss companies are highly dependent on foreign markets for sales and investments, particularly Germany. Swiss Reinsurance, Zurich Financial Services, and Credit Suisse have cut dividends, taken big charges on equity writedowns, and other investment losses."

The Swiss were the last tranche of the risk bagholders stuck with the worst of the worst of Bermuda Garbage offloaded by Western banks. Desperate to "catch up" with the "New Era" of "Wildcat Finance", the Swiss finally dumped their conservative posture and snapped up the last of the low grade risk pools to rake in huge fees and show the globe that they were "Big Global Risk Players".

Now they are getting shafted from cash calls coming out of nowhere, obscure no-name intermediaries in the Caribbean demanding payment on derivative exotica tied to Enron, WorldCom, Ahold, and Kmart. What was sold to Merrill Lynch, Citibank, and J.P Morgan ended up being stripped, sliced, and diced and distributed to unknown Pyramid Players with "Special Purpose Vehicle" designations and Cayman Islands P.O. Box addresses.

Now, Switzerland has no other choice but to look to Germany, its largest trading partner, in an attempt to export its way to prosperity and "earn" their way out of their mistakes through "growth". Unfortunately, Germany is in dire straits. Its fortunes are directly tied to the success of one stock on the DAX: Infineon Technologies. And Infineonâs fortunes are directly related to the fortunes of AMAT, whose fortunes are directly related to Samsung, whose fortunes are directly related to Sony and Dell, whose fortunes are directly related to Joe Sixpack, who carries the weight of the entire financial globe on his shoulders, based on his ability to obtain credit card limit increases in order to buy another cell phone, computer, DVD player, or a Ford Explorer with GPS navigation.

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