Global recession produces many stimulating ideas
Sunday, 13 September 2009
From Fazle Rashid
NEW YORK, Sept 12: The economic meltdown, which began in the US, the heart of market economy, and swept through the entire world with the fury of a tempest, has produced many stimulating ideas. China was the first to propose that US dollar as the sole international currency be replaced by the International Monetary Fund (IMF)-controlled Special Drawing Right (SDR). The idea did not catch the imagination of others.
Then came the move of greater regulation of the financial system to prevent any future crisis. It did not go down well with many. Nothing much is heard about the idea of bolstering the capital base of the IMF. Many such innovative ideas were floated.
The latest is the talk about imposing a " global tax ". The idea has been mooted by a German minister. The timing is important. The finance minister of Germany, Peer Steinbruck, has proposed that a global tax be levied on all financial transaction. The cost of the economic crisis should not be borne by small tax payers alone. The idea has not won the support of chancellor Angela Merkel.
The Group of Twenty (G20) summit is billed for Sept 24-25 at Pittsburgh. The finance minister is a coalition partner of Angela Merkel. The German election is due at the end of this month
The hefty pay packets the bankers take home in the US and Europe has whipped a frenzy of public outrage. French president Nicolas Sarkozy is seen by the bankers as a villain. Chastened bankers have agreed to new curbs on pay in an attempt to quell storm but many privately believe that the government is keeping bankers pay in the headlines for political reason, an analyst wrote.
The policy planners are trying to direct people's anger towards the financial community and away from the government, one investment banker was quoted as saying. They (government) are clearly looking for scapegoats and trying to make themselves popular in the public eye.
Nomura, a Japanese investment bank, has hired more than 60 per cent of the graduate trainees who were axed by Lehman Brothers. The recruitment drive highlights the resurgence of fortunes of some investment bank. Nomura has globally hired 8500 people and taken back 150 employees it had axed.
This is a strong indication of the revival of the Japanese economy but corporate inventory showed otherwise. Fast falling corporate inventory meant gross domestic product (GDP) grew more slowly in the second half than earlier estimated. Analyst however said the recovery is on track.
NEW YORK, Sept 12: The economic meltdown, which began in the US, the heart of market economy, and swept through the entire world with the fury of a tempest, has produced many stimulating ideas. China was the first to propose that US dollar as the sole international currency be replaced by the International Monetary Fund (IMF)-controlled Special Drawing Right (SDR). The idea did not catch the imagination of others.
Then came the move of greater regulation of the financial system to prevent any future crisis. It did not go down well with many. Nothing much is heard about the idea of bolstering the capital base of the IMF. Many such innovative ideas were floated.
The latest is the talk about imposing a " global tax ". The idea has been mooted by a German minister. The timing is important. The finance minister of Germany, Peer Steinbruck, has proposed that a global tax be levied on all financial transaction. The cost of the economic crisis should not be borne by small tax payers alone. The idea has not won the support of chancellor Angela Merkel.
The Group of Twenty (G20) summit is billed for Sept 24-25 at Pittsburgh. The finance minister is a coalition partner of Angela Merkel. The German election is due at the end of this month
The hefty pay packets the bankers take home in the US and Europe has whipped a frenzy of public outrage. French president Nicolas Sarkozy is seen by the bankers as a villain. Chastened bankers have agreed to new curbs on pay in an attempt to quell storm but many privately believe that the government is keeping bankers pay in the headlines for political reason, an analyst wrote.
The policy planners are trying to direct people's anger towards the financial community and away from the government, one investment banker was quoted as saying. They (government) are clearly looking for scapegoats and trying to make themselves popular in the public eye.
Nomura, a Japanese investment bank, has hired more than 60 per cent of the graduate trainees who were axed by Lehman Brothers. The recruitment drive highlights the resurgence of fortunes of some investment bank. Nomura has globally hired 8500 people and taken back 150 employees it had axed.
This is a strong indication of the revival of the Japanese economy but corporate inventory showed otherwise. Fast falling corporate inventory meant gross domestic product (GDP) grew more slowly in the second half than earlier estimated. Analyst however said the recovery is on track.