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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (72355)	2/5/2010 3:05:26 PM
From: carranza2	Read Replies (1) \| Respond to of 74559

Your desire for increased insomnia seems to be fulfilled.

To: TobagoJack who wrote (72355)	2/5/2010 6:58:13 PM
From: Haim R. Branisteanu	Respond to of 74559

Canada Flaherty:G-7 To Talk More On European Debt (Updates with more comments from Flaherty and other details beginning in eighth paragraph.) IQALUIT, Nunavut (Dow Jones)--Canadian Finance Minister Jim Flaherty said Group of Seven policy makers have had preliminary discussions about fiscal and sovereign-credit issues in European countries, including Greece, and expect to have further talks at the meeting starts later Friday. He said that "at a fundamental level" it is an issue for the European Union and not the G-7 as a whole. But three members of the euro zone--France, Germany and Italy--are in the G-7. "It's a matter of concern that I'm sure we'll talk about tonight and tomorrow," Flaherty said at a news conference. He said that policy makers have to be "very mindful" of the potential failure of domestic economies and "persistence of toxic assets" in some banks. "These are issues that are persisting. We've been advocating for a long time now that we need to fix the banks," he said. Flaherty said there are "differences of action" in how countries are moving on bank-overhaul plans and hoped to make progress on the issue at the G-7. "I'm sure we'll try to work on that to try to have a more uniform approach," Flaherty said. Flaherty said Canada is advocating its banking system as a model for other countries because it has "stood up to the test" of the financial crisis, not just in regulation but also in terms of effective supervision so that banks maintained proper levels of capitalization. He said there is a proposal for so-called "continuing capitalization"--excess capitalization to deal with potential bank failures--and the G-7 will discuss this at their meeting. Another key topic of discussion will be the world economy, with global imbalances a major concern, he said. A key component of this is foreign-exchange policies, Flaherty said, noting that "some Asian economies have relatively rigid currencies," in a veiled reference to China. "This is an issue which cannot be avoided. It is a Group of 20 issue quite correctly, but it is an issue also that concerns the Western industrialized countries that are represented in the G-7," he said. He said the G-7 all agree that continued stimulus is necessary because global economic growth isn't entrenched, and there isn't adequate private demand to replace public demand. But there are also concerns about deficit levels and how to exit from stimulus measures and return to balanced budgets, he said. On a separate issue, Flaherty described as "terrific" the preliminary deal reached by Canada and the U.S. to resolve the dispute over controversial "Buy American" provisions in the U.S. economic stimulus package. -Nirmala Menon, Dow Jones Newswires; 867-222-2392; nirmala.menon@dowjones.com