Retired people who derive most of their income from pensions and savings which are linked to stock market indices will not be consoled by the news that part of the USD280 billion worth of citizens` money which is now being pledged by the Swiss authorities to back the shotgun marriage of UBS to Credit Suisse will be used to (1) maintain the enormous bonus and “compensation” payments due to the executive officers whose reckless policies led to the downfall and (2) abolish the cap of €250,000 indemnity guarantees made to depositors. This would seem to support the capitalist “Spiral Law” that any downward movement in the wealth of the hoi polloi shall be proportional to an upward movement in that of the minority elite. Indeed, a reversal of the “trickle-down theory”

Credit Suisse predominantly provided services to the ultra-rich and permitted some quite extraordinary investment banking procedures worthy of the most inventive and ambitious of hedge fund managers. It is significant that, during the past chaotic fortnight, Bitcoin has rallied in value by 35% especially as the dramatic losses incurred in the USA by the First Republic and Silicon Valley Banks were due to substantial liquidity challenges made by their mainly digital investors.

A continued slide into the financial abyss caused by speculative investment banking plus the continuation of high inflation rates will inevitably bring further falls in the real value of our pensions and savings and a consequent lowering of living standards which are already bordering upon economic poverty.

by email Roberto Cavaleiro, Tomar