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Non-Tech : The ENRON Scandal -- Ignore unavailable to you. Want to Upgrade?

To: Mephisto who wrote (4534)	9/27/2002 1:49:15 PM
From: Mephisto	Read Replies (1) \| Respond to of 5185

Bush's Security Strategy September 27, 2002 nytimes.com To the Editor: The Bush administration's new national security strategy (front page, Sept. 20), despite its rejection of international cooperation, is the very opposite of isolationism. It is a declaration of intent for global domination. It abandons longstanding treaties and agreements on nonproliferation, antiballistic missile defense, comprehensive nuclear test bans and no-first-strike understandings. It announces that we will strike pre-emptively and unilaterally against any nation that we define as a threat. It declares that no other nation may attempt to equal our military strength: we will "dissuade" it. It proposes a global economic policy to be administered by instruments we control, the International Monetary Fund and the World Bank . In sum, it asserts that American sovereignty trumps all other national sovereignties - America über alles. H. JACK GEIGER, M.D. Brooklyn, Sept. 20, 2002 The writer is a founding member and former president, Physicians for Social Responsibility . Copyright The New York Times Company

To: Mephisto who wrote (4534)	9/28/2002 11:15:07 PM
From: Mephisto	Read Replies (1) \| Respond to of 5185

IMF Ponders Crisis Prevention at Meeting Sat Sep 28, 8:32 PM ET dailynews.yahoo.com By Mark Egan WASHINGTON (Reuters) - The International Monetary Fund ( news - web sites) held the centerpiece of its annual meetings here on Saturday, and announced changes aimed at making economic crises like those that have bedeviled Argentina and Brazil less frequent, as 3,000 police kept protests subdued. The global lender's policy-setting International Monetary and Financial Committee, comprising finance ministers from rich countries and the developing world, met on Saturday to set the IMF's agenda for the coming six months. Top of the agenda was how best to shore up the nascent global economic recovery, which has not taken hold as quickly or as strongly as the IMF had hoped just a few months ago. The IMF called on rich nations to rebuild confidence shaken by plunging stock markets, and urged Europe and Japan to speed economic reforms to bolster their long-term growth prospects. "We meet here in Washington at a testing time for the world economy, with 20 countries accounting for half the world's output having been at some point in the last year or this year in recession," Gordon Brown, chairman of the IMFC and British finance minister, said at a news briefing after the meeting. "Aware ever more of our interdependence, we are now more than ever aware that it is only by each country taking necessary action that we shall secure the economic growth we wish to see," Brown said at a news briefing. Earlier at the meeting, U.S. Treasury Secretary O'Neill said, "North America continues to be the engine of global recovery," and others must do more to bolster prospects. The IMFC called on Europe to reform labor and product markets and for Japan to tackle its banking and corporate problems, where, "monetary easing should help end deflation." But with key Latin American nations embroiled in economic turmoil and others there looking increasingly vulnerable, crisis prevention took center stage at the meeting. Meanwhile outside the meetings, peaceful protesters gathered. The rag-tag bunch, who oppose everything from the World Bank ( news - web sites)'s involvement in oil and gas projects to the need for more debt relief for poor countries, numbered only a few thousand after police depleted their ranks with more than 600 arrests in scattered street skirmishes on Friday. The number of protesters paled in comparison to the crowds in April 2000, when tens of thousands of anti-globalization demonstrators turned the streets near the IMF's headquarters into something of a siege zone. On Saturday the closest the thousands of protesters got to the IMF was a few blocks away where they rallied for much of the afternoon, causing minor disruption to city traffic. BANKRUPTCY COURT Perhaps the single most important development on Saturday was the IMFC charging the IMF to come up with a plan by April to pave the way for setting up some sort of international bankruptcy court to deal with what should happen if a country defaults on its debts. The IMFC told the IMF to, "develop for consideration ... a concrete proposal for a statutory sovereign debt restructuring mechanism to be considered by the membership." The issue has been spurred by the economic collapse and subsequent default of Argentina -- the former Wall Street darling and erstwhile poster child of IMF reforms. And with Brazil hit by investor worries that a $250 billion debt default is possible, there is finally agreement that something must be done to avoid a repeat of the Argentine debacle. The IMF hopes a new bankruptcy court will make the process of default more predictable, less painful and eventually act as a steadying influence on emerging market investors. "This is part of an integrated process for better crisis prevention," IMF Managing Director Horst Koehler said. And, hoping to allay Wall Street opposition, he added, "This ... will not undermine the credit culture in the global economy. It is a last resort." The fund's approach complements another plan endorsed on Friday by the Group of Seven industrialized nations -- the United States, Japan, Germany, Britain, Canada, France and Italy. The G7 said on Friday all emerging market bonds should now include so-called collective action clauses detailing what should be done if a default occurs. While rich countries support the approach of both collective action clauses and an international bankruptcy court, not everyone agrees. The G24, a group of top emerging market economies, said on Friday it was "open-minded" about the G7 plan but "skeptical" about the IMF's idea. Wall Street too opposes the IMF's plans. Mexico, a key emerging market because of its investment-grade credit rating, opposes the IMF's approach. The nation is more open to collective-action clauses, but Finance Minister Francisco Gil Diaz said on Saturday he doesn't see, "either lenders or borrowers seriously considering them." Nevertheless, the fund is convinced an international bankruptcy court will help its broader crisis-prevention efforts to stop problems before they happen. The discussion comes as Argentina's economy flounders in a state of collapse after nine months of failed talks to restart aid. Meanwhile Brazil is mired in a crisis of confidence ahead of October presidential elections, which prompted the IMF to fork out a record $30 billion bailout earlier this month. Koehler dismissed market fears that Brazil's crisis will end in a debt restructuring, saying, "Brazil will come out of this situation without a debt restructuring." But even while the IMF showered Brazil with praise in recent days, its real currency has plumbed new lows. This latest summit has been notable for increased impatience about what many, including the heads of the IMF and World Bank, view as the hypocrisy of rich nations' trade policies and low aid levels. Brown said there was now a "new deal for the world economy" where rich nations would increase aid and investment in developing nations in return for reforms there. But even as he made that statement, he urged donor nations to come through "urgently" with $1 billion to keep an already-promised debt relief plan for the world's poorest nations afloat. Email Story dailynews.yahoo.com

To: Mephisto who wrote (4534)	9/30/2002 12:21:32 AM
From: Mephisto	Respond to of 5185

Does the law of gravity apply to the dollar? Edmund L. Andrews The New York Times Monday, September 30, 2002 iht.com WASHINGTON After more than two decades during which the United States bought and consumed far more than it produced, has payback time finally arrived? A growing number of the bankers and finance officials from around the world who gathered in Washington over the weekend for the annual meetings of the International Monetary Fund and World Bank say it is near - and if it is not, they suggest, then it should be. "The current gaps between growth in real domestic demand and real output cannot be sustained indefinitely," the Fund warned in its latest review of the world economy. The imbalances in the U.S. economy, it said, are now so big that they pose a "significant risk" to global financial stability. The U.S. economy has seemed to defy gravity for years, running steadily bigger trade deficits almost every year for the past two decades. Yet because growth was so strong through most of the 1990s, the economy has also acted as a vacuum cleaner, sucking in hundreds of billions of dollars in foreign investment every year. The upshot has been an impossible balancing act - a huge need for foreign cash, yet an indefatigable domestic currency - that has caused hand-wringing among central bankers elsewhere who cannot believe the United States keeps getting away with it. The current-account deficit - the combination of trade in goods and services and the balance of income payments - totaled about $242.5 billion in the first half and is on track to hit a record of nearly $500 billion for the year. According to the Fund, the United States now absorbs about 6 percent of the world's savings to finance its deficit. Japan, plagued by a stagnant domestic economy, has been exporting about 1.5 percent of the world's savings, much of it to the United States. Economists at the Fund and elsewhere worry that investors might abruptly sour on the dollar because prices have simply become too high or because they no longer believe the United States can grow faster than the rest of the world. "After the stock market bubble and the technology bubble, the last obvious remaining bubble is the dollar," said C. Fred Bergsten, director of the Institute for International Economics in Washington. A steep plunge in the dollar would make foreign products more expensive in dollar terms, choking off exports to the United States and growth overseas. Exports to the United States have been among the world's most important sources of growth. Bergsten says a collapse in the dollar remains unlikely because the economic fundamentals of the United States remain sound. But he argues that a correction is inevitable and that the Bush administration should act preemptively by intervening in financial markets to nudge down the dollar an additional 10 percent or 20 percent. "The dollar did come down pretty steadily and in a totally ordinary way in the first six months of this year, and there was no adverse effect on inflation," he said. But since late July, the dollar has climbed slightly. U.S. manufacturers have been pleading for a weaker dollar for years, saying the high dollar is the main reason manufacturing exports have been stagnant. But Treasury Secretary Paul O'Neill has insisted that exchange rates be set by market forces, and he has even argued that the current-account deficit is an accounting abstraction that means little in the real world of business. If foreign money floods into the American market and keeps the dollar high, he says, that reflects only the comparative appeal of the United States as an investment target. "What exactly are we supposed to do about it?" one senior official asked. Fund officials acknowledge the problem, noting that the "ideal solution" to the imbalance would be for Europe and Japan to speed up their own desultory growth by making their markets more flexible and open. iht.com