The Times states:
"French President Nicolas Sarkozy said that ''Europe wants the system to be refounded,'' and stressed the importance of the April meeting.
''We all want London to be a success and we are all aware that it's (our) last chance,'' Sarkozy said. ''We cannot afford a failure in London.''
European leaders also backed Merkel's call for a ''charter of sustainable economic activity'' that would subject all financial market activities around the globe to regulation, including credit rating agencies.
Merkel's proposal envisions giving increased powers to the IMF, which the leaders agreed needed to receive double its current funding in order to help members respond ''swiftly and flexibly'' to a crisis."It will be another crisis moment for the new Administration and we believe that this may be additive to all of the other issues. We will be following this closely.
The details reported by Reuters today makes the sense of confrontation ever more clear. Specifically Reuters states:
"Below are highlights from a "chair's summary" of conclusions from the meeting that was seen by Reuters:
RENEWING GLOBAL FINANCIAL MARKET REGULATION IS A PRIORITY
.......
- We have today underscored once again our conviction that all financial markets, products and participants must be subject to appropriate oversight or regulation, without exception and regardless of their country of domicile. This is especially true for those private pools of capital, including hedge funds, that may present a systemic risk.
- We also agreed that credit rating agencies should be subject to mandatory registration and oversight.
- We have today agreed on advocating reforms to ensure that banks build additional buffers of resources in good times.
- A list of uncooperative jurisdictions and a toolbox of sanctions must be devised as soon as possible.
- The Financial Action Task Force, OECD and FSF should submit proposals in their respective fields to the G20 Finance Ministers meeting in March, for review at the London Summit.
- We will strongly advocate (at the London summit)...the development of an effective early warning system by the IMF and FSF, working in close cooperation.
- We will strongly advocate (at the London summit)...the adoption of principles on compensation practices to prevent bonus payments that contribute to excessive risk-taking."
This is further exacerbated by the massive drops in Central European currencies such as the Polish zloty and the Czech currency. The Russian currency also continues to drop. In many ways this appears as if it were 1930 again. That presents many real threats to the Administration which may lack both the understanding of long term European history as well as that of the early part of the 20th century.History has a strange way of repeating itself again and again.
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