Not so Cuckoo the Swiss

   Switzerland is about to come down hard on hedge funds, which have been flooding into the country for the past few years. The combination of Switzerland's low taxes, light touch regulatory regime, and rich victims  - I mean citizens - seemed too good to be true for hedge funds escaping tougher regulatory climes. Dozens of funds and managers fled NYC and London for Geneva, Zug, Zurich and beyond, driving up property prices, filling up international schools and generally pissing off the xenophobic Swiss.
   The one thing the hedgies did not expect was that the Swiss would tighten regulations, making it into one of the most “exacting” jurisdictions in the world for money managers, according to the Financial Times. The Swiss government is claiming that it wants to be in line with new EU regulations, but that can't be it. Switzerland has never deigned to even be a part of Europe, and especially not the EU.
   So why are they doing it? Here is one clue: "Wealthy individuals would also be stripped of their automatic status as 'qualified investors' permitted to deposit money with hedge funds directly," the FT said.
   And here is another: There is anecdotal and press evidence that Swiss citizens are having to leave the country to find apartments and houses to rent or buy, because it is too expensive to live in Switzerland. The hedge fund managers, with their vastly deep pockets, are pricing the Swiss out of the market.
   My conclusion is twofold:
1.) Swiss private banking is one of the mainstays of the economy, and these banks have been losing business to hedge funds.
2.) Swiss citizens do not want to live in France or any other second-rate country outside their own borders.
   The Swiss government takes care of the Swiss first and foremost. Hedge funds better start looking for another place to hide.