Feb. 6 (Bloomberg) -- Major economies with inflexible currencies must consider strengthening them if the global economy is to be weaned off its dependence on U.S. spending and Asian savings, according to a report prepared for a meeting of finance chiefs from the Group of Seven. "Countries with inflexible nominal exchange rates must permit greater flexibility in real exchange rates either through higher inflation or a nominal appreciation of their currency," the document, drawn up by Canada's Finance Ministry and obtained by Bloomberg News, said. G-7 finance ministers and central bankers are meeting in Iqaluit, Canada, today as policy makers seek to avoid a widening of distortions such as the U.S. trade deficit and the Chinese current-account surplus, which economists blame for helping deepen the worst postwar worldwide recession. "While global imbalances were not the primary cause of the financial crisis, there is little doubt that they were an important contributor to the recession we faced," the G-7 document said. "For global growth to be sustainable, it must be balanced." The report doesn't mention which countries are viewed as having inflexible currencies. China has attracted criticism this year from foreign governments for limiting gains in the value of its yuan since July 2008 after it strengthened 21 percent against the dollar over the previous three years.
Feb. 6 (Bloomberg) -- Major economies with inflexible currencies must consider strengthening them if the global economy is to be weaned off its dependence on U.S. spending and Asian savings, according to a report prepared for a meeting of finance chiefs from the Group of Seven.
"Countries with inflexible nominal exchange rates must permit greater flexibility in real exchange rates either through higher inflation or a nominal appreciation of their currency," the document, drawn up by Canada's Finance Ministry and obtained by Bloomberg News, said.
G-7 finance ministers and central bankers are meeting in Iqaluit, Canada, today as policy makers seek to avoid a widening of distortions such as the U.S. trade deficit and the Chinese current-account surplus, which economists blame for helping deepen the worst postwar worldwide recession.
"While global imbalances were not the primary cause of the financial crisis, there is little doubt that they were an important contributor to the recession we faced," the G-7 document said. "For global growth to be sustainable, it must be balanced."
The report doesn't mention which countries are viewed as having inflexible currencies. China has attracted criticism this year from foreign governments for limiting gains in the value of its yuan since July 2008 after it strengthened 21 percent against the dollar over the previous three years.
I'm perennially baffled by the occasional phenomenon of American officials publicly complaining about China's currency policy. After all, what kind of a world are we living in when a great nation can't think of a way to devalue its own money? Larry Summers is a brilliant economist, but he can't think up a better way of making this happen then asking the Chinese nicely (or not-so-nicely) then maybe he ought to step aside and let someone stupid take the helm. Maybe it's just that I have no idea what I'm talking about, but I actually feel confident that if Barack Obama put someone who doesn't know what he's talking about (me, say) in charge and give me a mandate to devalue the dollar I could get the job done.
Finance ministers from seven of the world's biggest economies concluded a meeting in the Canadian Arctic on Saturday with pledges to maintain their fiscal stimulus programs, despite rising worries among investors about the mounting debts of some European governments. "We are all absolutely committed to maintaining the support for our economies until we make sure that we have recovery established," Alistair Darling, Britain's chancellor of the Exchequer, said in Iqaluit, Nunavut, where finance ministers and central bankers from the Group of 7 nations were meeting. The European debt crisis, and its spread from Greece to other countries in the euro zone like Portugal, Spain and Italy, were a focus of the two-day talks. "The European authorities gave us a very comprehensive review of the program now in place to address the challenges faced by the Greek economy," the United States Treasury secretary, Timothy F. Geithner, told reporters. He added that the officials had assured the group that they would manage the problem "with great care."
Finance ministers from seven of the world's biggest economies concluded a meeting in the Canadian Arctic on Saturday with pledges to maintain their fiscal stimulus programs, despite rising worries among investors about the mounting debts of some European governments.
"We are all absolutely committed to maintaining the support for our economies until we make sure that we have recovery established," Alistair Darling, Britain's chancellor of the Exchequer, said in Iqaluit, Nunavut, where finance ministers and central bankers from the Group of 7 nations were meeting.
The European debt crisis, and its spread from Greece to other countries in the euro zone like Portugal, Spain and Italy, were a focus of the two-day talks.
"The European authorities gave us a very comprehensive review of the program now in place to address the challenges faced by the Greek economy," the United States Treasury secretary, Timothy F. Geithner, told reporters. He added that the officials had assured the group that they would manage the problem "with great care."
The Group of Seven leading economies have pledged to cancel Haiti's debt in the wake of last month's crippling earthquake. Canadian Finance Minister Jim Flaherty made the announcement yesterday following a two-day gathering of G7 finance ministers. "The debt to multilateral institutions should be forgiven and we'll work with these institutions and other partners to make this happen as soon as possible," he said. Mr Flaherty said members had also discussed possible long-term assistance for the impoverished country, although he did not mention any figures.
The Group of Seven leading economies have pledged to cancel Haiti's debt in the wake of last month's crippling earthquake.
Canadian Finance Minister Jim Flaherty made the announcement yesterday following a two-day gathering of G7 finance ministers.
"The debt to multilateral institutions should be forgiven and we'll work with these institutions and other partners to make this happen as soon as possible," he said.
Mr Flaherty said members had also discussed possible long-term assistance for the impoverished country, although he did not mention any figures.
Feb. 6 (Bloomberg) -- Dexia SA, which received billions of euros in capital and funding guarantees from France, Belgium and Luxembourg, agreed to sell assets in Italy, Spain and Slovakia to gain European Union approval of the taxpayer-funded bailout. Dexia will sell municipal-lending units in Italy and Spain, its Slovak consumer-banking network and its Turkish insurance unit, Chief Executive Officer Pierre Mariani and Chairman Jean- Luc Dehaene said at a press conference in Brussels yesterday. "The European Commission asked us to make additional efforts," Mariani said. These steps should "contribute to solve the group's problems rather than aggravate them." Dexia's agreement with the European Union aims to reduce the bank's dependency on short-term credit, which led it to seek a government rescue after credit markets seized up following Lehman Brothers Holdings Inc.'s collapse in September 2008. Dexia joins Amsterdam-based ING Groep NV, Lloyds Banking Group Plc and KBC Groep NV in winning EU approval for government bailouts after agreeing to sell assets.
Feb. 6 (Bloomberg) -- Dexia SA, which received billions of euros in capital and funding guarantees from France, Belgium and Luxembourg, agreed to sell assets in Italy, Spain and Slovakia to gain European Union approval of the taxpayer-funded bailout.
Dexia will sell municipal-lending units in Italy and Spain, its Slovak consumer-banking network and its Turkish insurance unit, Chief Executive Officer Pierre Mariani and Chairman Jean- Luc Dehaene said at a press conference in Brussels yesterday.
"The European Commission asked us to make additional efforts," Mariani said. These steps should "contribute to solve the group's problems rather than aggravate them."
Dexia's agreement with the European Union aims to reduce the bank's dependency on short-term credit, which led it to seek a government rescue after credit markets seized up following Lehman Brothers Holdings Inc.'s collapse in September 2008. Dexia joins Amsterdam-based ING Groep NV, Lloyds Banking Group Plc and KBC Groep NV in winning EU approval for government bailouts after agreeing to sell assets.
Furthermore, even accounting for accounting slippages, the Greek budget deficit for 2009-2010 is likely to be lower, possibly much lower, than those in the UK and US, according to Organisation for Economic Co-operation and Development projections. Nor is Greek public debt unusual, by current standards. It is about half that of Japan and lower than Italy's. So why Greece and why now? Here is my conspiracy theory....The first step in my theory is the non-controversial conclusion that the only reason why the Greek government might default is market pressure....Here comes the second step of my conspiracy theory. Rumour has it that some large German and French banks have a significant exposure to Greek debt. Rumour also has it that the same banks have yet to recognise much of their losses on US subprime mortgages. Now things start hanging together. France and Germany can allow Greece to default, but not some big, systemically important European banks....
Rumour has it that some large German and French banks have a significant exposure to Greek debt. Rumour also has it that the same banks have yet to recognise much of their losses on US subprime mortgages. Now things start hanging together. France and Germany can allow Greece to default, but not some big, systemically important European banks....
On another note: as you may know, I've said for a while now that the Greece issue would be used by Berlin and Brussels to bring down the Euro, in order to make European products more affordable globally. The US dollar has simply dived too deep. For all I know, Merkel, Sarkozy and Trichet may be actively feeding international media horror stories about Greece and Portugal. But that doesn't mean they'll let them fall.
http://theautomaticearth.blogspot.com/ Hey, Grandma Moses started late!
If [the European counterparts to Henry Paulson and Tim Geithner with respect to U.S. banks] bail Greece out, one day they will have to be grilled too, and they will have no good answer.
Too bad that "some banks are too big to fail" line only works once. The march of civilizations is a series of defenses that man has put up against the dread of pure existence.
Unfortunately, anyone who truly believes that, anytime soon, we will be in a position to regain the level of competitivity enjoyed by most Italian manufacturers only ten years ago thanks to a favourable exchange rate is very sadly mistaken. More specifically, we are facing a collapse in the industrial manufacturing sector that will take us back 20 years, meaning jobs that we will never be regained. Those who are thinking about copying the English model, which is based on the services and advanced tertiary sectors, has unfortunately entirely failed to grasp precisely what happened in England, a Country that, more than 20 years ago now, chose to follow the Thatcher route that entailed the selling-off of major State assets, or in other words privatising everything. Now, twenty years on, while England is still rueing those criminal political choices, these people that continuously talk about a recovery while in 2009 our GDP dropped by 6% and the forecasts for 2010 show an expected recovery of + 0.10% or 0.20%, in my opinion this is anything but a recovery and smacks of us being taken for a ride
LONDON (AP) -- The overall amount of money invested in soldiers, weapons and war has been largely unaffected by the global economic downturn, a think tank said in a report published Wednesday. The London-based International Institute for Strategic Studies said the total amount of money spent on world defense budgets rose from $1.3 trillion to $1.55 trillion between 2006 and 2008, and likely continued to climb further in 2009.
The London-based International Institute for Strategic Studies said the total amount of money spent on world defense budgets rose from $1.3 trillion to $1.55 trillion between 2006 and 2008, and likely continued to climb further in 2009.
TEHRAN, Feb 7 (Reuters) - Iran has established an energy fund backed by the Central Bank and other Iranian banks to help finance investments in the sector, Oil Minister Massoud Mirkazemi said on Sunday. "The National Energy Fund, with the help of the resources of four local banks and the Central Bank, has been established to help finance major parts of the oil industry's activities," the official IRNA news agency quoted Mirkazemi as saying.
TEHRAN, Feb 7 (Reuters) - Iran has established an energy fund backed by the Central Bank and other Iranian banks to help finance investments in the sector, Oil Minister Massoud Mirkazemi said on Sunday.
"The National Energy Fund, with the help of the resources of four local banks and the Central Bank, has been established to help finance major parts of the oil industry's activities," the official IRNA news agency quoted Mirkazemi as saying.
