Feb 20, 2009

It would bound to happen. You can't spend $787 billion on top of the previous $700 billion without looking for new sources of revenue.

The US government is now suing the biggest Swiss bank (UBS) to obtain the names of Americans who have accounts there.

http://www.usatoday.com/money/industries/banking/2009-02-19-ubs-tax-evaders-irs_N.htm

Everyone knows the purpose of a secret Swiss bank account. Obviously, it is to hide money from the IRS or least least to protect it from the greedy fingers of a cash-starved IRS.

I find it interesting that the seriousness of today's situation has finally brought about this kind of lawsuit. Watch for a bank run to occur at UBS. You probably won't see lines of people in front of the bank, because the frightened ones are the American account holders seeking to transfer their money to new accounts, perhaps in other countries. It will most likely be an electronic run on the bank, such as we had last September.

Watch the IRS chase down those accounts in the Caymans and other places.

Swiss bank accounts cannot be counted on as a "safe haven" any more. It will be interesting to watch the fallout from this. UBS has been suffering along with the rest of Europe's banks, and this latest problem could put them over the cliff.