Inside the Credit Suisse merger: This is not a bailout?

The most common phrase the western government abused is clearly ‘this is not a bailout’.

This may not be A BAILOUT, BUT THIS IS CLEARLY A 1+1<2

CS is less than one, and it pretends to be 1.

While CS pretends to be sound and solid, it has $17 Billion in the riskiest bond, known as AT1.

While one of the largest Auditor PWC has provided an ‘ADVERSE’ opinion and indicates there is a ‘material weakness’ in CS’s balance sheet.

The SEC called CS for inquiry and CS's share price has plummeted.

Everyone is TELLING ME it's OKAY, BUT I KNOW IT IS NOT.

That is LYING to the public in plain sight.

They know CS is too big to fail and they know CS scale is THREE TIMES compared to the LEHMAN Brothers bankruptcy.

They claim this is not a BAILOUT, just forcing someone else to take over.

Now it is NOT A BAILOUT as long as:

1. You are not using taxpayers' money DIRECTLY. BUT INDIRECTLY USE ANY MONEY AS LONG AS IT IS NOT FROM TAXPAYER POCKET.
2. You find whoever is big to clean the mess, becomes your scapegoat.
3. The banking sector remains still and no laws or regulations needed to be changed or enhanced.
4. The bankers and shareholders are ‘sacked’ and fired but get millions of fat bonuses out of bank compensations, they sold lots of shares before the meltdown but still somehow got their ‘DESERVED PUNISHMENT’.
5. The government is not taking the blame, whoever takes the blame will be from the future when everything hits harder. THEY BLAME SHORT SELLERS, COMMENTATORS, AND WHOEVER EXPOSES THEIR DARK SECRETS.

Instead of calling it a ‘bail out’, they call this a ‘commercial solution’ by the Swiss finance minister- an abruptly forced merger between UBS and Credit Suisse. This is clearly against UBS shareholders’ free will and interest.

While most shareholders of UBS are firmly against this deal, their efforts are still meaningless.

CS is currently trading at 2 dollars while UBS is trading at 18.2

UBS has strong reasons to oppose the such a deal, given the fact that CS has been involved in lots of notorious events such as :

1. CS lost more than 50 billion during the Archego scandal.
2. CS lost more than 10 billion in the Greensill case.
3. The ex-CEO is found guilty of spying on its own employees.
4. Money laundering for Russian Oligarch and Mexican drug cartel.
5. Helping its rich clients doing Tax evasion.
6. CS's chaotic management, repeatedly ‘restructures’ itself more than 4 times, share price still plummeted.
7. With lots of hidden risky bonds and derivatives exposure, CS is caught faking its balance sheet and numbers.

From a pure ‘commercial and interest’ point of view, there is no reason for UBS to acquire such risky assets.

There is no way UBS will benefit from this deal except by pleasing the Swiss government.

So this is what happened.

Instead of being blamed by the taxpayers for saying it is a bailout.

A much easier solution will be to ask UBS to buy CS, while the Swiss government is providing BILLIONS OF COLLATERAL AND LOANS, WITH a GOVERNMENT GUARANTEE FOR THE RISKS INSIDE OF CS.

YES, THIS DOES NOT SOUND LIKE A BAILOUT.

IT SOUNDS LIKE THE GOVERNMENT IS JUST FRIENDLY AND KIND ENOUGH TO HELP CS.

I am afraid that the US and Swiss authorities' recent behaviors have severely damaged the principles and fundamentals of the FREE MARKET mechanism.

What is the definition of free-market?

A simpler definition would be:

Let the wrongdoers bear their own consequences by allowing them to be fined and bankrupt.

The free market is the foundation of modern capitalism and this differs from the communism-based collective market. The free market is used to represent prosperity and efficiency.

Now our free-market structure has been corrupted. It no longer represents the above merits.

Now our financial system finally becomes the PLAYGROUND OF FINANCIAL INSTITUTIONS.

They can do whatever they want because clearly, the government is going to help them at all costs even if they create a facade of being nice banks. No harm will be done even if they are caught in sight.

Now everything has changed in the name of GREATER GOOD.

Behind the GREATER GOOD is that our government DEREGULATE the BANKS SO BANKERS CAN DO WHATEVER THEY WANT.

1. They can easily BORROW HUGE MONEY FROM OUR BANKING SYSTEM while other industries and small businesses are struggling to acquire the most basic loans.
2. Banks have no moral standards they will do anything as long as there are profits to make.
3. No risk management is required by the BIG banks. SIFI( significant important financial institution) is allowed to be ‘saved’ at all costs.
4. They will add leverage and risks to their balance sheet, they are allowed to have extreme risk tolerance since they are backed by the government.
5. No hedges and protections are required. Government is the ultimate hedge.
6. Banks now operate with a significant conflict of interest, bankers prioritize their own interests above their clients. The only relationship between the clients and bankers is that bankers still need their client's money.

They kept mentioning it so they would not be blamed whatsoever. The reason behind it was if they claimed this

The policy will create the following impacts:

1. The credibility of the Swiss banking sector will go down the toilet.
2. Credit Swiss toxic assets and derivatives exposures remain hidden and might explode in the near future while the FED is raising the fed fund rate.
3. A TOTAL SKEPTICISM OF GOVERNMENT.
4. TOTAL DESTRUCTION OF CONFIDENCE OF BANKS AND FINANCIAL SYSTEM.

Now we don’t have a problem with CS.

Now we have a BIG PROBLEM WITH GLOBAL FINANCIAL AUTHORITY.

THIS FINANCIAL CRISIS IS FAR FROM OVER, YOU CAN PROCRASTINATE BUT YOU CAN NOT ESCAPE FROM THE KARMA FOREVER.