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Meandering Thoughts on G-20
We have a great opportunity, rising from the ashes of this crisis, to come up with a global securities/financial products regulatory governance structure that might actually get a grip on the world in the 21st century. Because, I suppose, the Asian currency crisis in the 1990s wasn't enough to scare the crap out of anyone. We had to wait until Lehman and Bear fell. I only hope that the G-20 will give the SEC and its foreign counterparts the go-ahead to start drafting us some coordinated regulation.
Also at the summit, the U.S. pledged -- all hortatory of course -- to cut imports and consumer spending, and obtained a counter promise from China to start building its own domestic demand. The aim, obviously, to do *something* about the gigantic trade imbalances that...remind one, in a very frightening way... of that little Thai Bhat crisis of 10 years ago. Except a million times bigger.
And they all agree that the IMF will monitor the progress of our promises and assurances, and that they would open books and records for member-country review and observation. This is where I get confused.
First, the IMF already monitors trade imbalances and slaps countries around when their pegged currencies get a little too ridiculous. That's like, um, its purpose. And...since a country's voice and power over the IMF, like that of its sister Bretton Woods institution, correlates directly with how much that country pays in...Well, it's all sort of like the U.S. promising to be what it already is. I suppose Obama is hoping that everyone is so confused as to what the IMF does that we'll all walk away happy....sort of like when they talk about monetary policy at the Fed. Until it all falls apart.
Second. I don't suppose anyone remembers, wayyyy back before 9-11, that the world sat down and came up with the Millennium Development Goals, to, inter alia, end extreme poverty (bono anyone?), improve womens rights, and save the environment. All they could think to do to make sure countries' honored their promises was to insert some sort of peer pressure -- lots of countries' agreed, and ostensibly would want to save face instead of reneging. Instead of forming a real treaty.
So, like, that turned out real well.
Also at the summit, the U.S. pledged -- all hortatory of course -- to cut imports and consumer spending, and obtained a counter promise from China to start building its own domestic demand. The aim, obviously, to do *something* about the gigantic trade imbalances that...remind one, in a very frightening way... of that little Thai Bhat crisis of 10 years ago. Except a million times bigger.
And they all agree that the IMF will monitor the progress of our promises and assurances, and that they would open books and records for member-country review and observation. This is where I get confused.
First, the IMF already monitors trade imbalances and slaps countries around when their pegged currencies get a little too ridiculous. That's like, um, its purpose. And...since a country's voice and power over the IMF, like that of its sister Bretton Woods institution, correlates directly with how much that country pays in...Well, it's all sort of like the U.S. promising to be what it already is. I suppose Obama is hoping that everyone is so confused as to what the IMF does that we'll all walk away happy....sort of like when they talk about monetary policy at the Fed. Until it all falls apart.
Second. I don't suppose anyone remembers, wayyyy back before 9-11, that the world sat down and came up with the Millennium Development Goals, to, inter alia, end extreme poverty (bono anyone?), improve womens rights, and save the environment. All they could think to do to make sure countries' honored their promises was to insert some sort of peer pressure -- lots of countries' agreed, and ostensibly would want to save face instead of reneging. Instead of forming a real treaty.
So, like, that turned out real well.
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