Today was quite important in Switzerland since the first vote of the swiss senators was in favor of the LEX USA. Switzerland has been pushed around quite a bit the last few years ,especially due to the case UBS which was exploited extensively by the US government to pressure one of the few true remaining democracies in the world.
Switzerland may have to bow at the end but…. one more time the US attitude is showing aggressivity and losing more of its capital of sympathy.
It is hard to say now what will be the consequences in the short term but the underlying reading that a growing crowd in the world is doing is…. that doing business in US dollar… is becoming a risk.
Dont not read me wrongly, but the US attidude is perceived as some kind of black mailing. Maybe Switzerland should “turn down” the offer and instead of the traditional Cowboy and Western scenario… we gonna end with a poker party because a real stand off between the two country at this stage…. represents a systemic risk for the financial world.
We might be surprised about the long term outcome (10 years?) of this situation. I hear among the invesmtent community that …. doing business in USD… is maybe starting to become a risky business. The US is still a economical magnet but…. there are some tremendous weaknesses which will alter its atractivity. The recent hot NSA soying issue is also upsetting many people around the world and the list could continue if we want.
The biggest challenge to the USA is a world getting better, let’s say that in 10 years that the world is a better place…. more invesments will select other destinations and the USD market share as the world currency.. will probably shrink.
Let’s not forget that the Star War and Arm race back in the 80’s was the pillar of the USSR going broke. If history rimes… the same shall apply to the USA… the cost of their supremacy…. shall become more and more difficult to bear will all the consequences this might bring.
let’s see in 10 years