Randomly Noted

Neal Lipschutz is attending the World Economic Forum in Davos, Switzerland.

World Economic Forum officials are pleased with the increased participation this year of representatives of emerging economies in the group’s annual meeting getting under way in Davos, Switzerland.

Such emerging country attendance is said to be up significantly from a year ago.

It’s perhaps just one more sign of the shift in economic power and investment interest away from the U.S. and other large Western nations.

That notion of different short-term economic futures for the developed and developing (the very names of the categories are being called into question) markets was reinforced by bond manager Bill Gross of investment firm PIMCO.

In his monthly commentary, published today, Gross advised a globally minded investor to look for a “savings-oriented economy which should evolve into a consumer-focused economy.” China, India, Brazil “and more miniature-sized examples of each would be excellent examples,” he wrote.

As G7 nations and “their lookalikes” delever, they have given up the driver’s seat of the global economy, Gross said.

He saved perhaps his harshest language for the United Kingdom. He called the nation’s bonds “a must to avoid,” citing factors that have placed gilts “resting on a bed of nitroglycerine.”

Neal Lipschutz is attending the World Economic Forum in Davos, Switzerland.

Registering at the World Economic Forum annual meeting in Davos, Switzerland, you are, of course, handed a meeting bag. The WEF’s bag sports the immodest motto, “Committed to improving the state of the world.”

Continue reading…

Neal Lipschutz is attending the World Economic Forum in Davos, Switzerland.

The word “stakeholder” is used with some frequency in the press release announcing results of a World Economic Forum report on the future of the global financial system.

Though business fuzzy, the term stakeholder does take on greater resonance this year at the Forum’s annual meeting getting under way in Davos, Switzerland, as the emphasis of the get-together is on rethinking and rebuilding global financial architecture.

Continue reading…

Novartis is paying Nestle $180 a share for the chocolate company’s stake in Alcon; the drug maker is offering a measly $153 a share to Alcon shareholders for the remaining 23% it won’t own. Can they conjure up a winnable legal case against Novartis’s gambit to force a higher price? Perhaps. With 25% of Alcon already in hand, Novartis’s deal with Nestle will bring its stake to 77%. CEO Daniel Vasella, cites Swiss law (all three players are incorporated in Switzerland) in maintaining he doesn’t need the approval of Alcon shareholders to secure dominant ownership of the eye-health company. He’s probably right on the legal details – but here’s guessing he’ll boost his offer to Alcon shareholders a tad, if only to avoid making too many enemies among institutional investors.

Credit Suisse signals its determination to expand its private banking operations, despite the troubles that have beset the wider industry and the blows to Switzerland’s role as a tax haven. Many private banking institutions – notably CS’s Swiss rival UBS – have suffered from the recent crackdown on tax evasion and the uncertainty about which banks will weather the credit crisis.  Credit Suisse clearly sees an opportunity, and wants to raise the number of CS private bankers from about 3,400 today to 4,000 by 2012. It says that Swiss institutions can’t rely on Switzerland’s tax advantages any more and have to have to compete through the service they offer and through expansion into new markets.  CS provided evidence it is benefiting from the travails of some of its rivals – it said that senior private bankers made up three quarters of its hires in the first half of 2009, compared with less than half in 2008. Senior bankers tend to be better at generating business, reflected in the much higher levels of net new funds transferred to the bank per advisor in the six months after hiring.

Read Katharina Bart’s article at http://online.wsj.com/article/SB125360550023830229.html

Today, with the official announcement of a Swiss-U.S. tax deal over UBS client data, the chairman of the once-mighty investment bank is talking about repairing its reputation. It’s too late. Memories are short and of course over time some people will forget about UBS’s tax tangles. But what they won’t forget is this: UBS has lost its raison d’etre. No longer able to promise secrecy and invisibility to its customers – thanks to a crackdown on bank secrecy laws in Switzerland and other havens – and still suffering from costly financial missteps that cost it clients and assets, UBS faces an uphill battle reinventing itself. Last week, Oswald Grubel, the CEO, told the WSJ’s Stephen Fidler UBS will seek its future in emerging markets such as Asia and the Middle East. But those areas are crowded – packed with banks whose reputations have stayed relatively intact amid the global financial crisis. UBS, for its part, bled CHF123 billion in asset outflows last year as clients, spooked by the bank’s exposure to so-called “toxic” assets, fled with their money; the outflows have continued this year as it became embroiled in tax woes. DJN quotes the bank’s chairman, Kaspar Villiger, as saying the tax pact with the U.S. “will allow the bank to continue moving foward to rebuild its reputation through solid performance and client service.” That’s do-able but very tough.