Greeks who moved their savings to Swiss banks seeking safety are watching the E.U. and their government leaning on the Swiss to send the money back to the tottering Greek banks whether the money owners like it or not. E.U. Officials Negotiating Forced Greek Capital Repatriation With Swiss Banks is the report. Reminiscent of the 1930s… I guess private property doesn’t mean much to governments when their interests are involved. If this happens:
1. It will spread, capital transfers will be widely controlled, and
2. There will be PANIC! Which will make things much worse, much faster.
E.U. Forcing Swiss Banks To Return Greek Depositor’s Money To Greece?
I'm not sure if the EU will succeed. The whole point of having a Swiss account is to protect your money from craziness in your home country. If the Swiss give in, then lots of Europeans will close out their Swiss accounts and move their money to the Caymans or elsewhere. It will be a huge loss of credibility for the Swiss banking industry.
Because, if the Swiss have to bend over for the Greeks, who WILL they be able to refuse in the future? They will become Europe's shared "prison girlfriend".