Even Swiss Bankers Have Lost Their Mystique

Swiss bankers, once regarded with a ton of mystique and for having a certain gravitas internationally, made headlines for the wrong reasons this weekend given the shotgun wedding deal between UBS and troubled CS, all while The Swiss National Bank backstopping. We also had the developed economy central banks around the world, including The Fed in front of the FOMC this week, join hands together to try to keep swap lines open for banks. 

In reality, this is likely the first domino to fall given that The Swiss National Bank introduced negative interest rates (or "NIRP") for banks in January 2015. Many commercial Swiss banks eventually began charging their customers interest on their account balances. To think we would get off scot-free from NIRP is wishful thinking, and I expect many more dislocations which is why the central banks are panicking already.

All of this does not typically happen in healthy bull markets, but as I write this the Dow and S&P are higher even as the Nasdaq takes a breather amid rates bouncing. 

Equities, and even bonds, remain uniquely confident that all is well, or at least these bandaids will work to smooth things over. Technically, I still see an overarching bear market with ten months and running of overall sideways action on most indices. 

For now, I am pacing myself on taking new trades, letting this quagmire run its course and likely burn itself out.