We do not sell financial products, but we do have an opinion
Our investment specialists possess years of experience and an outstanding track record in their field. Financial information is processed with a proven, systematic investment method that is subject to constant, structured dialogue with our client advisors. We are not afraid to voice opinions that run counter to the prevailing mainstream.
We use our international network to generate knowledge
Globally active family offices, well-established links with leading banks in Switzerland and abroad, and a lively exchange with trading and research teams all create a first-class network for generating knowledge. We also have access at any time to proven, strong partners for special questions. In this way, our clients can approach investment decisions with the benefit of an optimal combination of experience, continuity, and cutting-edge expert knowledge from renowned organisations.
Private Client Report
In our «Private Client Report», our investment specialists present one to a maximum of two pages that give a broad overview of the current market, key macroeconomic data, and the performance of our equity investments. The «Report» is intended only for our clients and supports our periodic reporting in a manner that is efficient and to the point.
Private Client Letter
The four-page «Private Client Letter» published at the end of each quarter, highlights major trends that are relevant to investors from a strategic perspective. The CEO of our bank addresses a specific topic in detail and the Chairman comments on the current situation. You can subscribe to the «Letter» by requesting it here info[at]privateclientbank.ch. Examples and a brief description of previous issues can be found here
Q2/2024 (April)
«Alternative Substances»: Natural resources are the lifeblood of the economy. For millennia, human history has been shaped by resource shortages, price surges, and supply crises. At the same time, humanity's remarkable spirit of invention runs like a thread through history: When resources became scarce, new technologies, deposits, or substitutes were found. And for investors they hold a special allure. Yet, investments in commodities are complex and challenging - it is not for nothing that they are considered «alternative» investments.
«Stop and Go»: In recent weeks, the monetary policy measures taken by central banks in Japan and Switzerland have caused a furore. However, central bank interest rates appear to have only little or long-delayed effect around the zero lower bound.
Q1/2024 (January)
«Precarious dynamics»: Just as in climate research, also in finance we know potential tipping points where small changes can have huge consequences. Consequently, in times of fundamental change uncertainty is particularly high. Nevertheless, markets are currently upbeat. Investors with resources and strong nerves can continue to exploit opportunities – those without should reconsider the risks.
«Contemplating the worst…»: A turn of the year provides an opportunity to weed and plough through the scenario garden once again. The worst case would be a gradual defeat of Ukraine in their stand against the Russian invaders. Let us hope that the unimaginable never comes to pass.
Q4/2023 (October)
«Weird conditions»: The economy as a machine, with clear laws and few levers to control - that's what investors, entrepreneurs and investors would wish for. The reality is different, psychology, coincidence and external factors play a role. This is also true at present, with various indicators signalling extraordinary circumstances in the markets. But the good news is: Cash and bonds are yielding interest again, and with this there are alternatives.
«The journey continues»: The next surge of globalisation is coming, we have not yet reached the end of the story in terms of productivity gains – and deflationary effects are to be expected this time as well.
«Waiting for Godot»: For over a year we have been waiting for energy shortages, rising unemployment and the big recession. But occurrence, depth and duration of recessions cannot be predicted with any accuracy. Moreover, economic conditions may actually be better than sentiment – for one, due to the burgeoning technological revolution.
«Rapid and und Brutal»: That is how modern bank runs work. Not least for this reason, the global financial system remains latently unstable also after the demise of Credit Suisse. Rumours would presumably be enough to shake even solid banks to their foundations.
«On a Ridge»: In these times of the digital revolution, bank failures no longer occur via queues at counters and ATMs, but quietly via the internet, in a kind of digital earthquake beneath the surface. Thus, some banks in the US and in Switzerland Credit Suisse have experienced a kind of "blitz bank run" in recent weeks – all of a sudden, old concerns about the stability of the financial sector came back into focus. Even if there has been no contagion into the real economy so far, the issue remains virulent, not least in view of inflation and interest rate hikes. Authorities, central banks and the financial sector are walking on a narrow ridge. Against this backdrop, it is worth remembering a few simple rules for investing.
«In Capitalism one is ultimately responsible»: In companies, it is the owners who bear the responsibility. This applies to the case of the failed major bank Credit Suisse, but also elsewhere. If this responsibility is not assumed by shareholders, not only the survival of the particular firm is at stake, but also of capitalism in general.
«Winds of Change”: Contrary to all hopes, the last twelve months have seamlessly followed the roller-coaster ride of the past three years. The phrase «turning point» sounds trite, but this time there seems to be something to it. The anxious question of where we are drifting is cropping up in many conversations today. At the risk of not giving due credit to the big questions, in our new «Letter» we focus on what, in our view, is primarily responsible for the in many cases drastic valuation corrections on the markets in the past year: the rise in the price of money. In the process of the interest rate reversal markets are constantly occupied with revaluing every single asset. This is a definitely painful exercise. But from an economic point of view, the end of the irresponsible policy of cheap money is overdue and welcome – and hopefully healing, ultimately also for investors.
In times of rampant inflation, the high debt level becomes a real problem. It is as if we had to cope simultaneously with a global economic crisis, a world war and a tsunami hitting all the seas. If even more difficult times are ahead, there are zero reserves.
«Fear and Greed»: For investors, 2022 has been the worst year since 2008, and most likely the second-worst of the last 50 years. Against this backdrop, some are asking themselves whether, in times of great fear, it might already be the time to top up or start buying riskier investments. But the duration and degree of market aberrations cannot be predicted and the situation has rarely been so messy. In particular, it is quite possible that many actors, including those in central banks, underestimate the persistence of the current inflationary trend – de-globalisation, decarbonisation and the demographic shift. They all have the potential to drive prices upward for a prolonged period. As there is a risk of further negative surprises investors should stay on their guard.
“Unresolved Succession Problems”: We know from managing private assets and advising families on inheritance and succession issues, among other things, how difficult the replacement of a generation can turn out to be. After all, nothing requires more getting used to than the loss of power.
«Riding the Roller Coaster»: Central bank policy is not fine mechanics and can only work with crude means. In the past, interest-rate reversals were always accompanied by lengthy phases of heightened uncertainty. Caution and steady nerves are needed, not least with regard to the eurozone and its currency.
«Is it Volcker time?»: The widely respected Fed Chairman Paul Volcker successfully fought US-inflation in the 1980s against all kinds of resistance with at times very high interest rates. Such a policy might be appropriate and sensible also today, but would at least initially mean "blood, sweat and tears" for the economy.
«Risk, not chess»: For the first time in decades, a nuclear power is waging an open war of aggression against a neighbouring sovereign country. Notwithstanding all the consternation and anger about the war in Ukraine, we must note that wars rarely cause bear markets. Nonetheless, it is quite possible that the armed conflict in Ukraine now becomes the trigger (not the cause!) of a lengthy period of disorder in global monetary policy, in which constantly changing and contradictory signals in inflation and interest rates create uncertainty and volatility. Times are thus likely to become less calculable. So wealth management that is simple, understandable, transparent and flexible is more important than ever.
«Values are precarious»: The struggle for freedom in Eastern Europe is very important and admirable. The struggle for freedom and fundamental values in the West has yet to begin. There are signs, for example, that achievements of the enlightenment, such as the guarantee of property rights, the right to be heard, or independent judges are being lost in the heat of the conflict.
«Every single year»: Every year in December and January, the forecasters are in full swing: projections for economic development, stock markets, interest rates and currencies for the coming year fill the shelves and media. Price targets for stock indices and individual investment instruments are proclaimed. From our point of view - we admit it - the annual round of predictions has some entertainment value, but is of limited use. The world is too complex, the timing too difficult, the pace of change too unpredictable. More important than detailed forecasts are thorough analyses, regular strategy reviews, a steady hand and a bit of courage and patience.
«Systems competition put to the test»: The Corona pandemic is a prime example of system competition between countries. It is rare that such a far-reaching phenomenon be observed and analysed simultaneously in all regions of the world. The big question is: Who will manage to exit crisis mode quickly and relatively unscathed?
«Less quiet waters»: In the last couple of weeks, fears of inflationary spikes and setbacks in economic growth are rife. The very image of stagflation was even recently conjured up in the Anglo-Saxon press. It is true that consumer prices in virtually all countries have risen more sharply in recent months than in many years. And there are signals from the Chinese economy, in particular, which are giving cause for concern. However, we believe that the general conditions for the markets have not fundamentally changed. It's a matter of staying the course, even if it might get a little rougher.
«Tally-ho! Blithely hunting the rich»: At this year's central bank meeting in Jackson Hole, three American economists presented a paper that – to put it briefly – blames the rich for the sustained low interest rates. That is reason enough to address the issue in a short commentary.
«Sound Money, Unsound Money»: Liquidity is an asset class, and not simply an account balance. Safe and stable money does not fall from the sky, but must be constantly hammered out anew. We should pay more attention to this, even when times are good.
«A Special Bank in a Special Country»: The sometimes stubborn individualism of the swiss people and the quest for “being different” has its price. Ultimately, however, it is an expression of vibrant diversity and thus of diversification. This is also what our bank stands for.
«Virtual Economy»: Networks and digital products that can be used free of charge do not appear in any accounts. The accompanying changes do not invalidate the coordinate system of the economy, but they do lead to a fundamental upheaval. Familiar methods of analysis and historical comparisons must be closely scrutinised.
«SPACs: Catching flies with honey and vinegar»: Special Purpose Acquisition Companies are causing a stir in investor circles these days. On the one hand, they provide welcome efficiency gains in capital markets. On the other hand however, with financial vehicles of this kind the danger lies in buying a pig in a poke and then being taken to the cleaners by rascals.
«No Free Lunch»: The financial markets weathered the turbulence of the crisis year 2020 well. The reckoning for the great corona bailout, however, is far from settled. And once again, we were reminded that the mindful dealing with uncertainty is an essential component of an entrepreneurial investor’s toolbox. But those who take a few basic rules to heart can be confident even in challenging times.
«Uncomfortable thoughts at year’s begin»: The corona crisis has opened floodgates to more public intervention, even to the point of literally locking up citizens. It is to be feared that interventions in individual rights could ultimately also affect private property – in particular real estate investments, which are highly dependent on local conditions and legislation.
“A Great Crossing”: Private market investments are experiencing a boom. There are plenty of good reasons for this. However, those aiming for success should also recognise the pitfalls. Genuine entrepreneurship is required, and this cannot be delegated.
«Zombie banking is reality»: Our once proudly client-friendly commercial banks have become semi-governmental bureaucratic monsters. In such an environment, it is actually quite easy to be a good banker: You just have to focus rigorously on the interests and needs of your clients.
«Anchoring in Real Assets»: Financial markets are recovering rapidly from the corona shock; the state of the real economy, on the other hand, is still far from normal. In times of great uncertainty, it is worth taking a look at the long-term trends. These speak for real assets.
«The Hotel in the Bedroom and the Office in the Living Room»: With the corona crisis, there has been an enormous shift. Fewer offices and fewer aircraft will be needed. Already existing capital will be better utilised.
«Low on Reserves»: The global economy already had a weakened immune system when the coronavirus struck. Nonetheless, the chances are good that it will stage a timely recovery. Times of great uncertainty call for diversification, discipline, patience – and a dose of courage.
«There is a Tomorrow»: People, and the economy, are more resilient than is generally assumed and more than the well-meaning regents believe.
«Strategic Confidence»: There is certainly no shortage of potential triggers for the next financial crisis. However, fear and anticipation of the big crash are not good advisors. Rather, an appropriate dose of confidence is called for. And confidence means being invested.
«The Right Direction»: The polluter pays principle belongs in a market economy. We have always known that we were environmental free-riders. Now we have the tools to change this – and change it we will.
«Genie in a Bottle»: The smartphone is becoming a wallet. This opens the door to digital forms of money that seemed inconceivable until now. If the result were to be robust, global, secure currencies, then consumers and investors could benefit.
«Calm and composed – yes, but...»: Financial market agnostics are aware that the trigger of the next crisis cannot be predicted, not even with artificial intelligence. Even in the midst of dramatic price fluctuations, they stand by their chosen strategy.
«La La Land»: Cheap money is playing the music on the financial markets. Those who have been invested in the US stock market for the last ten years have nearly tripled their assets. The policy of cheap money is likely to continue; however, there are doubts as to its sustainability. Sober investors should be positioned in such a way that they are prepared to act when the wind changes.
«Reassuring self-deception»: Financial crises have very little effect on the real world. Factories are not destroyed nor are merchant fleets scuttled.