Kashya, the wife of Phillip Hilldebrand (head of the Swiss National Bank) sold Swiss Francs just a few days before the Swiss National Bank initiated exchange controls and devalued the Franc. The timing of the transactions was nearly perfect. The suggestion is that “pillow talk” between husband and wife lead to the trades.
Don’t expect heads to roll over this transgression. There has been a complete review by Swiss authorities and the conclusion is that there were no insider trading violations by the wife. That’s not to say that trades did not happen.
Apparently, Kashya Hildebrand bought ~$500,000 when she shorted the CHF. This relatively small transaction netted the Hildebrand family only ~$50,000 in less than one month. Being that the amount is so small, the conclusion is that nothing nefarious has taken place. From NZZ.
Therefore no central banker in the world would risk his job.
Really? Only $50k extra for the wife’s account? That’s not enough incentive? I guess so. Hubby earns CHF 862,000 ($950,00) at the SNB. (A sweet deal, Ben Bernanke takes in less than $200k)
The information was leaked by a bank employee? To a politician? Folks, this stuff is not supposed to happen in Switzerland. This is the land of banking secrecy. This leak is highly illegal. This affair proves one point. There is no secrecy left in Swiss banking (for residents and non-residents alike). Anyone who thinks there is, is just wrong.
It’s not possible to know the facts in this story. It’s been whitewashed. There are a number of possible scenarios. I wish I knew which one was right:
-Philipp Hildebrand never told his wife about the pending exchange controls and devaluation of the CHF.
-Kashya Hildebrand acted independently; she never informed her husband of the transactions she made with the family’s money (she also bought dollars and sold CHF for her daughter).
-Kashya Hildebrand routinely bought and sold dollars. The timing of the transactions (August 15th) was pure coincidence.
-No other employees of the SNB (or their family members) sold Swiss Francs in advance of the devaluation.
-ALL OTHERS.....
This story stinks. It’s about political intrigue, stolen information from secret banks, leaked information from Central Banks and possible insider currency trading. A nice way to kick off the New Year!
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Jon Corzine won't go to jail, either.
ReplyDeleteIt's all "legal."
What dies though are salesmen's jobs. And, banking jobs. And, probably anyone who depends on a commission ... ain't gonna be finding customers so fast.
As to the wife in this case? Well, she's about as "lucky" as DSK's wife. Or what women do who are attracted to wealthy men.
It's the FINKLESTEIN CURSE.
Here's the story about that: A beautiful blonde woman met her friends for lunch. She was sporting a magnificent diamond ring. So large, it looked like a doorknob. Her friends oogled it. And, asked her about it. When she said it came with "THE FINKLESTEIN CURSE."
Alas, that's the man's name. Who got engaged to this "dish."
So, whose happy now?
BK,
ReplyDeleteI disagree with you on this one! Why should Hildebrand risk his job & reputation over 50k CHF? Doesn't make sense and you'll have to agree. Esp. given the money he makes.
Someone has leaked the documents to Blocher - and whoever that was has violated the banking secrecy laws. They'll have that person's head for this.
Greetings from CH
"Why should Hildebrand risk his job & reputation over 50k CHF?"
ReplyDeleteb/c they are so arrogant that they operate under the assumption to get away with it - which they obviously will
@ Anon 10:23. I agree with Anon 2:46--these people have no scruples and their greed knows no ethical bounds. No matter how much money you have, there are always reasons to want more--IMHO, she couldn't resist reaching out and taking a taste of this for herself.
ReplyDeleteQuis custodiet ipsos custodes?
Agreed, @Anon 2:46 and But what Do I know --- greed is not logical. It often seems to be in hindsight that people try to assign logic but, it doesn't apply.
ReplyDeleteI mean, gee whiz, after all the longtime philandering of Bill Clinton, he has to keep going for more....with a 22 year old IN the oval office. There was zero logic or rational thought involved.(But a serious creep factor!)
Yes, they know the liklihood is that they'll get away with it. Also, I'm guessing they were hoping for more on that trade than the 50K.
No matter what the reason is there should be strict rules for people and members in those positions or some kind of full disclosure. They have enough other benefits.
ReplyDeletelike someone posted already: greed is not logical . I run optionsdigger.com and am astonished about what i see and follow daily ...
You should be ashamed (look it up) of such slimey, insidious rumormongering leads. Ms. Hildebrand bought a picture for her gallery in USD. Thousands of Swiss people stocked up on Euros and Dollars in the days and weeks before the SNB acted. The SNB's intentions were broadly discussed in the press.
ReplyDeleteThe smear campaign against Hildebrand seems to be orchestrated by the right-wing populist SVP. The details aren't out yet. The rumor is meant to destabilise the economy and to induce mistrust into the public.
We're not quite as dumbed-down and gullible as some would have us be yet, and the broader public isn^t buying into that mistrust and fear yet. So stuff your rumors somewhere soft, warm and stinky why don't you.
It's similar to what Lawrence Lessig meant when he said Code is Law. His saying applied to the internet, but in finance, Code is the customary practices of the banking system.
ReplyDeleteThose practices are a law unto themselves, because the system is mostly run by computers (automated), and is complicated enough that no one has credibility to challenge it on individual cases without looking like they're asking for special favor.
Totally agree with Roy... can you imagine how many people have purchased Forex in CH in August 2011? The USD & EUR were ridiculously cheap and even I have purchased 3k USD for my next holiday. Do I have to go to jail now because I did this? Claiming Ms Hildebrand had insider information when making this purchase is stupid! She used to be a FX trader, and also realized that the exch. rate was low. Plus she runs a business requiring her to make sizable transactions in currenies because she owns a gallery.
ReplyDeleteI do not agree with what the SNB did in September, I oppose currency manipulation, but this discussion about the Hildebrands just missed the point.
Regards, Anon 10:23pm
I know people in Switzerland who changed their dollars 1 month before the devaluation because they were terrified that their capital was dwindling.
DeleteIt's easy for you who does not live in switzerland to say that any idiot knew the CHF would devalue.
He knew of the transaction and should not have authorised it though at first he said he did not know.
He should resign and to pay him 900,000 CHF to leave is outrageous.
Roy:
ReplyDeleteI should be ashamed? Why me? I did not trade on insider info. Kashya did.
As for me spreading rumors, well that is just bunk. I don't spread rumors. I write about facts.
Look at the papers today Roy. Everyone has the SNB story today. I was just a day early with the news.
I don't mind criticism. Your comments however, are way off base. Do me a favor, read some some other blog. One where you get the phony information you seem to like. Don't come back with your snide remarks. You're not welcome here.
Bruce Krasting
Meeku says...
ReplyDeleteBruce; you are totally wrong on your allegations...u as a journalist u here to create noise so that crowd reads your BS...I do admit, u sometimes have great articles, but this one is really off track...if u look at the numbers, u as an ex-banker you would see that it does not add up...can not believe u focusing with aggressivity on a small trade...you make this fuss for nothing (or probably for crowd and making it look like CHF is the devil while FED & WS buddies look like angels..
I never knew there would be another Hillary? Is her husband also sterile?
ReplyDeleteThere is no de facto banking serecy anymore in Switzerland, they sold out a long time ago.
ReplyDeleteThe Germans buy stolen CD's with alleged tax evaders data. The French, the Greek and the Italian do the same in a similar scenario.
The US got a grip on the CH banks and possibly the government, via the organised tax evasion crimes commited by Creditsuisse and UBS managers within the US.
The SNB is a similar contraption like the ECB and the Federal Reserve (As much Federal as Federal Express). A mainly private consortium with special interests and the privilege to "make" money .... out of thin air! The money is then used to charge interest plus compound interest, as well as bailing out banks and industries, that are "to big to fail" (de facto bancrupt!)
If we look at those astronomic numbers this happens on a regular basis, it is even obvious to a financial rookie that a monetary pay back never will and can take place. - The tax payers are left, as usual, with the bag.
The reckless money "creation" also leads already to inflation, which is nothing but a FORCED TAX, as there is no escape for the ones on the consumer side.
Expect the unexpected in the course of a few months. Giant banking outfits will face insolvencies and go under, no matter what. It is time to change the slogan: Too big to SAVE !!!
This is the systemic risk in action.
In the words of Chrysostom, “Good men, like great cities, have many crooked arts and dark alleys in their hearts, whereby he that knows them may save himself much time and trouble.”
ReplyDelete