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Title: G-7 Frets Central Banks Can't Avoid Peril Without Helping Hand
Source:
Bloomberg
URL Source: [None]
Published: Feb 4, 2008
Author: By Simon Kennedy and John Fraher
Post Date: 2008-02-04 23:30:33 by DeaconBenjamin
Keywords: None
Views: 148
Comments: 4
Feb. 4 (Bloomberg) -- Central bankers Ben S. Bernanke, Mervyn King and Jean-Claude Trichet need all the help they can get to fend off a global recession and restore confidence to financial markets. Government officials from the world's wealthiest nations meet in Tokyo this week under pressure to devise responses that go beyond monetary policy amid mounting evidence, six months after credit markets seized up, that central banks can't solve the world's economic woes by themselves. Big government may be on the way back as the Group of Seven nations take a more interventionist stance by imposing greater regulation on financial institutions and perhaps even stepping into the private sector to bail out nonperforming mortgage loans. ``There needs to be outside-of-the-box thinking,'' says Laura Tyson, a former economics adviser to President Bill Clinton who now teaches at the University of California, Berkeley. ``The problem has not been contained, and there's a continuing risk to the economy.'' She suggests the U.S. government work with lenders to convert the interest rates on stressed home loans into longer- term borrowing that is more manageable. As G-7 finance ministers and central bankers gather Feb. 9, they face the most precarious economic conditions since the aftermath of the 2001 terrorist attacks. Staving off a worldwide slump will top their agenda. `Policy Coordination' ``I want to discuss where policy coordination is possible,'' Japanese Finance Minister Fukushiro Nukaga, who will chair the talks, said Jan. 28. His Canadian counterpart, Jim Flaherty, anticipates ``more initiatives.'' ``If the medicine is strong enough and if it's done in conjunction with other governments, then I think you have a real possibility to stabilize the situation and make it better,'' Thomas Russo, vice chairman of Lehman Brothers Holdings Inc. in New York, said in a Bloomberg Television interview Jan. 24. ``If the medicine isn't effective or strong enough, you're in for a real downturn.'' Russo proposes offering government-backed loans to U.S. homeowners with adjustable-rate mortgages, whether prime or subprime. He also advocates a tax credit for people who buy homes this year that would triple the current benefits mortgage holders receive. Stephen King, chief economist at HSBC Holdings Plc in London and a former U.K. Treasury adviser, says the crisis may get so severe that governments will be forced to bail out homeowners who fall behind on loan payments and to buy up worthless assets that are hurting banks. Unblocking the System ``In a world of monetary drought, cutting interest rates alone is unlikely to unblock the system,'' King says. ``Larger budget deficits are likely to be an increasingly common feature of the policy-making landscape.'' Bernard Connolly, global strategist at American International Group's Banque AIG unit in London, even predicts authorities will eventually have to buy up stocks to prevent a crash. The leaders of Europe's biggest economies laid the groundwork for more-coordinated action last week at a meeting in London, saying they were ready to step up regulation unless banks hand over more information about their off-balance-sheet risks. The leaders -- including German Chancellor Angela Merkel, French President Nicolas Sarkozy and British Prime Minister Gordon Brown -- also demanded that ratings services give more information to investors. Limit Foreclosures In the U.S., Federal Deposit Insurance Corp. Chairwoman Sheila Bair told Congress Jan. 31 that mortgage companies ``invite regulatory and legislative action'' if they don't come up with additional measures to limit foreclosures. Senator Christopher Dodd, the Connecticut Democrat who chairs the banking panel, is exploring the creation of a federal program to buy and restructure delinquent and near-delinquent loans ``to help many borrowers as quickly as possible,'' he says. House Financial Services Committee Chairman Barney Frank, a Massachusetts Democrat, has said he favors the proposal. Policy makers will discuss similar measures in Tokyo, which might signal a retreat from more than two decades of deregulation. Some U.S. lawmakers blame looser government controls for allowing the excesses that inflated the U.S. real- estate bubble and triggered an unsustainable derivatives boom worldwide. `Not the Most Creative' The coordinated effort that Nukaga wants would also represent a break with recent history, says Stephen Roach, Morgan Stanley's Asia chairman. G-7 officials are ``not the most creative types in coming up with new approaches,'' he says. ``I don't see that the G-7 will move very clearly.'' Another handicap: Some of the world's fastest-growing nations won't be at the table. While China, Russia and South Korea have been invited to take part in sideline talks on Asian markets, they won't participate in the formal discussions. Even so, the G-7 governments may have to find ways to reinforce the steps their central banks have already taken. The Fed under Bernanke's chairmanship last week lowered its benchmark interest rate a half percentage point to 3 percent, the second cut in as many weeks and the fastest reduction since 1990. The Fed's statement encouraged speculation that rates would keep falling. Ease the Squeeze King's Bank of England and the Bank of Canada have also lowered borrowing costs, while joining the Fed, European Central Bank and Swiss National Bank in supplying more cash to markets to ease a credit squeeze. Such measures, though, don't repair damaged balance sheets or restore value to worthless assets. So lenders faced with mounting losses may keep avoiding risk and refusing to make new loans to companies and households. Easing monetary policy in such an environment amounts to ``pushing on a piece of string,'' says Nobel Prize-winning economist Joseph Stiglitz, a professor at Columbia University in New York. Inflation also limits the ability of some central banks to act. ECB President Trichet and Bank of England Governor King both say price pressures remain a concern in their economies. So far the U.S. and Canada have been alone among G-7 countries in offering a boost to monetary policy with tax cuts or government-spending programs. President George W. Bush won House of Representatives support for a stimulus package totaling at least $150 billion. Canada initiated a C$60 billion ($60 billion) five-year tax cut. Break With Tradition More fiscal easing in the U.S. may be necessary, and other governments should follow suit, Dominique Strauss-Kahn, managing director of the International Monetary Fund, told the World Economic Forum in Davos, Switzerland, Jan. 26, in a break with the fund's traditional push for smaller budgets. Such a shift at the IMF is ``mildly historic'' and ``an indication of the gravity of the situation we face,'' says former U.S. Treasury Secretary Lawrence Summers. ``We hate the idea of extensive government intervention, but it's going to have to come,'' Connolly says. ``The crisis is real and huge.''
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#2. To: DeaconBenjamin (#0)
It appears to me that it is only the so-called "West" (aka Rothschild/Rockefeller-controlled financial systems) that is facing an existential crisis of its usury system. The Arabs, Iran, India, Russia and China (you can even throw Brazil in the mix) are well-positioned to avoid this and move on. UNLESS "West" decides to "go medieval" and launch World War III on the more prudent Asians. If "West" does so and God is just, "West" will be destroyed.
If God is just, another "nation" will be destroyed. I'm sure you know this, but I believe it bears repeating for those who may not.... www.blueletterbible.org/kjv/Gen/Gen015.html#13 - 14 [We've put in our 400 years! www.blueletterbible.org/kjv/Gal/Gal003.html#29 ]: THE UNITED STATES IS STILL A BRITISH COLONY. EXTORTING TAXES FOR THE CROWN! A DOCUMENTARY REVIEW OF CHARTERS AND TREATIES. August 17, 1996. An Expose' ... www.theforbiddenknowledge..._british_colony_index.htm What You Didn't Know About Taxes & The 'Crown' | Mark Owen This other Crown is comprised of a committee of 12 banks headed by the Bank of England ... sovereign state know as The City of London, or simply ‘The City. ... www.conspiracyarchive.com/Commentary/Crown.htm "THE EMPIRE OF "THE CITY" (An excerpt from the book by E.C. Knuth) "The City" is an international financial oligarchy and is perhaps the most arbitrary and absolute form of government in the world. This international financial oligarchy uses the allegoric "Crown" as its symbol of power and has its headquarters in the ancient City of London, an area of 677 acres; which strangely in all the vast expanse of the 443,455 acres of Metropolitan London alone is not under the jurisdiction of the Metropolitan Police, but has its own private force of about 2,000 men, while its night population is under 9,000. This tiny area of a little over one square mile has in it the giant Bank of England, a privately owned institution; which as is further elaborated hereinafter is not subject to regulation by the British Parliament, and is in effect a sovereign world power. Within the City are located also the Stock Exchange and many institutions of world-wide scope. The City carries on its business of local government with a fanciful display of pompous medieval ceremony and with its officers attired in grotesque ancient costumes. Its voting power is vested in secret guilds with names of long extinct crafts such as the Mercers, Grocers, Fishmongers, Skinners, Vintners, etc. All this trivial pomp and absurdity and horse-play seems to serve very well to blind the eyes of the public to the big things going on behind the scenes; for the late Vincent Cartwright Vickers, once Deputy-Lieutenant of this City, a director of the great British armament firm of Vickers, Ltd., and a director of the Bank of England from 1910 to 1919, in his "Economic Tribulation" published 1940, lays the wars of the world on the door-step of the City. ........ .....The Pilgrims were founded in London July 24, 1902, four months after the death of Cecil Rhodes who had outlined an ideology of a secret society to work towards eventual British rule of all the world, and who had made particular provisions in his will designed to bring the United States among the countries "possessed by Great Britain." Sir Harry Brittain (high-ranking member of the Pilgrims) records that he was requested to come to New York in 1915 by the Chairman of the American Pilgrims "in order to give him a hand" in welcoming Lord Reading (Rufus Isaacs). The dinner in honor of Lord Reading took place at Sherry's on October 1st, and was attended by 400 representative men prominent in the banking, commercial and political life of the United States. The magic number of 400, once the symbol of reigning wealth and privilege, appears here in a new role. Men of millions here sway the destiny, the life or death of their fellow citizens, with an organization which is subversive to the spirit and the letter of the Constitution of the United States, an organization of which not one in one thousand of their fellow citizens has ever heard. The purpose of these men is completely interwoven with the dependence of their own invariably great fortunes on the operations of "The City," citadel of International Finance. Not only do these men collectively exert a planned influence of immense weight in utter secrecy, but they operate with the support of the immense funds provided by Cecil Rhodes and Andrew Carnegie. The late Robert M. LaFollette, Sr., in the course of a speech in the United States Senate in March, 1908, asserted that fewer than one hundred men control the great business interests of the country. His statement brought forth a nation-wide storm of denunciation and ridicule, and even today any similar statement is invariably derided as "crackpot." Nevertheless, Senator LaFollette conclusively demonstrated a few days later from the Directory of Directors that through interlocking directorates actually less than one dozen men controlled the business of the country, that in the last analysis the houses of Rockefeller and Morgan were the real business kings of America. empire.htm " www.biblebelievers.org.au/empire.htm The crash of 1929. HOW THE CITY OF LONDON CREATED THE GREAT DEPRESSION .... One of the main causes for the Great Depression was the Federal Reserve System of the United States ... www.tarpley.net/29crash.htm see also.... Great Red Dragon - About This Book "....It just so happened that I found this book in a large Detroit, Michigan used-book store, around the time of the signing of the Maastricht Treaty [1992]. It sends a cold chill through my body every time I read it, especially since it was published in 1889! Which was not long before the first World War. Don't we ever learn? Or is because this kinds of information is deliberately hidden? And that is why I think this book ties the past 500 years of our world's military/economic activities with the prophesies of the Bible's Book of Revelations. ......" greatreddragon.com/book.htm#sub1 Dragon Revelation: www.blueletterbible.org/c...rds.pl?word=dragon&page=1 Dragon City of London www.crwflags.com/FOTW/FLAGS/gb-lond.html Lord Mayor of the City of London City of London and "Gog and Magog" [Hopefully their judgment is very near, and CorpUSA's as well: Ezekiel 17:1-10/John 15:1-2/Matthew 15:13] http://www.lordmayorsshow.org/visitors/history/gogmagog
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#3. To: Sam Houston, DeaconBenjamin, Kamala (#2)
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