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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (51253)	6/13/2009 3:12:39 AM
From: elmatador	Respond to of 219784

Brazil Considers G8 Is No Longer A Valid Political Decision Group “G 8 is over as a political decision group” since “it represents nothing at all” and it’s not a valid instrument to address the reform of the global financial system, said Brazil’s Foreign Affairs minister Celso Amorim during a seminar in Paris on Mercosur. “You simply can’t ignore” emerging countries such as Brazil, China or India in these type of matters, given their growing economic influence, added Amorim addressing Friday the seminar on the tenth anniversary of the Mercosur Chair at the Paris Institute of Political Studies. Amorim said that G 20 (which brings together the world’s leading economies including several from developing countries) is more appropriate, “a better model” that the current G 8 made up of the seven richest countries in the world plus Russia. What is needed, insisted Amorim, “is to formalize” this new reality into such institutions as the International Monetary Fund and the World Bank and pointed out that Brazil’s objective is to reinforce the role of the G20 in discussions related to economic and financial issues, and also increase this influence to other fields of global interest. As an example he mentioned the issue of disarmament, particularly following US President Baerack Obama’s proposal, “the first such proposal from a US president”, to completely eliminate all nuclear weapons. Amorim who spoke after WTO Director General Paul Lamy said that the most pertinent forum could change according to the issue which it wishes to address because “we’re entering into a world of variable, shared governance”. The Brazilian minister admitted it is far more difficult to modify the current “global security governance”, but at the same it is the “great challenge we have ahead of us in the coming years”. Amorim emphasized that the world is changing and the instruments for global action have already began to be modified by WTO, where the G20 was born, an evolution that must be attributed to the “articulate diplomatic capacity” of countries such as Brazil or India.

To: TobagoJack who wrote (51253)	6/13/2009 11:26:32 AM
From: carranza2	Read Replies (1) \| Respond to of 219784

Simon Johnson on where we are now [note: the comments at the web page are as good as the original, so visit the web page if this interests you]: baselinescenario.com Where Are We Now? Five Point Summary with 6 comments 1. Financial markets have stabilized – largely because people believe that the government will not allow Citigroup to fail. We have effectively nationalized any banking system losses, but we’ll let bank executives enjoy the full benefits of the upside. How much shareholders participate remains to be seen; there will be no effective reining in of insider compensation (my version; Joe Nocera’s view). For more on how we got here, see the Frontline documentary that airs on Tuesday and Paul Solman’s explainer wrap up. 2. The real economy begins to bottom out, although unemployment will not peak for a while and could stay high for several years. Longer term growth prospects remain uncertain – has consumer behavior really changed; if finance doesn’t drive growth, what will; is the budget deficit under control or not (note: most of the guarantees extended to banks and other financial institutions are not scored in the budget)? 3. More broadly, there is sophisticated window dressing in the pipeline but no real reform on any issue central to (a) how the banking system operates, or (b) more broadly, how hubris in finance led us into this crisis. The financial sector lobbies appear stronger than ever. The administration ducked the early fights that set the tone (credit cards, bankruptcy, even cap and trade); it’s hard to see them making much progress on anything – with the possible exception of healthcare. 4. The consensus from conventional macroeconomics is that there can’t be significant inflation with unemployment so high, and the Fed will not tighten before late 2010. The financial markets beg to differ – presumably worrying, in part, about easy credit leading to dollar depreciation, higher import prices, and potential commodity price inflation worldwide. In all recent showdowns with standard macro models recently, the markets’ view of reality has prevailed. My advice: pay close attention to oil prices. 5. Emerging markets are increasingly viewed as having “decoupled” from the US/European malaise. This idea was wrong in early 2008, when it gained consensus status; this time around, it is probably setting us up for a new bubble – based on a “carry trade” that now runs out of the US. The ”appetite for risk” among investors is up sharply. The G7/G8/G20 is back to being irrelevant or merely cheerleaders for the financial sector. Comments welcome. By Simon Johnson