World Leaders Took Humility Tea, Says Brazil’s Lula After G-20 Summit

    Presidents Lula of Brazil and Bush of the US

    Presidents Lula of Brazil and Bush of the US Brazilian President Luiz Inácio Lula da Silva went back to Brazil after two days of talks in Washington where he participated in the summit of the G-20, the group of the world's 20 most powerful countries. The meeting was convened by US president, George Bush, who after eight years is getting ready to leave the presidency this coming January 20.

    The Brazilian leader seemed happy with the encounter's results. One of Brazil's revindications, the need to control the monetary flow, was heeded by the summit's participants with the decision of the G-20 to create a supervisory body to regulate the finance markets.

    Lula, was also encouraged with the decision by the summiteers to resume the Doha talks, which had been stalled. While Lula returned back home he left his Foreign minister, Celso Amorim, who stayed behind in the US for a meeting with Madeleine Albright, the secretary of State during the Clinton administration from January 1997 to January 2001.

    Albright is one of the senior advisers to president-elect Barack Obama. Obama himself didn't meet any foreign leader arguing that there is only one president at a time.

    "It was a historical day for world politics," said Lula, just before getting together with Chinese President Hu Jintao, "because, six months ago, nobody could imagine that we would arrive at a unanimous consensus to take better care of the world finances."

    The Brazilian leader has been advocating the end of the G-8 ,which according to him does not represent the real world anymore. But he is still not saying that the G-8 is dead. "I would not say that this was the end of the G-8 because the G-8, after all this time, became a friends' club and people will continue gathering."

    He added, however: "Considering the political power and the representativeness of the countries that make up the G-20,  there's no logic anymore to take decisions on the economy and politics without taking into consideration today's forum".

    Lula said that he was going back to Brazilian capital Brasí­lia happy. "The most important is that there is a cohesive decision of all presidents that you need to have a better management of the financial world, you need that decisions over the crisis be taken together. I felt a maturity that I hadn't seen in a long time. I always saw lots of resistance but after this crisis, everybody drank a very large cup of tea filled with humility."

    —————————————- 

    Joint Communiqué

    The following declaration was issued from the Summit on Financial Markets and the World Economy.

    DECLARATION:

    November 15, 2008

    1. We, the Leaders of the Group of Twenty, held an initial meeting in Washington on November 15, 2008, amid serious challenges to the world economy and financial markets. We are determined to enhance our cooperation and work together to restore global growth and achieve needed reforms in the world's financial systems.

    2. Over the past months our countries have taken urgent and exceptional measures to support the global economy and stabilize financial markets. These efforts must continue. At the same time, we must lay the foundation for reform to help to ensure that a global crisis, such as this one, does not happen again. Our work will be guided by a shared belief that market principles, open trade and investment regimes, and effectively regulated financial markets foster the dynamism, innovation, and entrepreneurship that are essential for economic growth, employment, and poverty reduction.

    Root Causes of the Current Crisis

    3. During a period of strong global growth, growing capital flows, and prolonged stability earlier this decade, market participants sought higher yields without an adequate appreciation of the risks and failed to exercise proper due diligence. At the same time, weak underwriting standards, unsound risk management practices, increasingly complex and opaque financial products, and consequent excessive leverage combined to create vulnerabilities in the system. Policy-makers, regulators and supervisors, in some advanced countries, did not adequately appreciate and address the risks building up in financial markets, keep pace with financial innovation, or take into account the systemic ramifications of domestic regulatory actions.

    4. Major underlying factors to the current situation were, among others, inconsistent and insufficiently coordinated macroeconomic policies, inadequate structural reforms, which led to unsustainable global macroeconomic outcomes. These developments, together, contributed to excesses and ultimately resulted in severe market disruption.

    Actions Taken and to Be Taken

    5. We have taken strong and significant actions to date to stimulate our economies, provide liquidity, strengthen the capital of financial institutions, protect savings and deposits, address regulatory deficiencies, unfreeze credit markets, and are working to ensure that international financial institutions (IFIs) can provide critical support for the global economy.

    6. But more needs to be done to stabilize financial markets and support economic growth. Economic momentum is slowing substantially in major economies and the global outlook has weakened. Many emerging market economies, which helped sustain the world economy this decade, are still experiencing good growth but increasingly are being adversely impacted by the worldwide slowdown.

    7. Against this background of deteriorating economic conditions worldwide, we agreed that a broader policy response is needed, based on closer macroeconomic cooperation, to restore growth, avoid negative spillovers and support emerging market economies and developing countries. As immediate steps to achieve these objectives, as well as to address longer-term challenges, we will:

    * Continue our vigorous efforts and take whatever further actions are necessary to stabilize the financial system.

    * Recognize the importance of monetary policy support, as deemed appropriate to domestic conditions.

    * Use fiscal measures to stimulate domestic demand to rapid effect, as appropriate, while maintaining a policy framework conducive to fiscal sustainability.

    * Help emerging and developing economies gain access to finance in current difficult financial conditions, including through liquidity facilities and program support. We stress the International Monetary Fund's (IMF) important role in crisis response, welcome its new short-term liquidity facility, and urge the ongoing review of its instruments and facilities to ensure flexibility.

    * Encourage the World Bank and other multilateral development banks (MDBs) to use their full capacity in support of their development agenda, and we welcome the recent introduction of new facilities by the World Bank in the areas of infrastructure and trade finance.

    * Ensure that the IMF, World Bank and other MDBs have sufficient resources to continue playing their role in overcoming the crisis.

    Common Principles for Reform of Financial Markets

    8. In addition to the actions taken above, we will implement reforms that will strengthen financial markets and regulatory regimes so as to avoid future crises. Regulation is first and foremost the responsibility of national regulators who constitute the first line of defense against market instability. However, our financial markets are global in scope, therefore, intensified international cooperation among regulators and strengthening of international standards, where necessary, and their consistent implementation is necessary to protect against adverse cross-border, regional and global developments affecting international financial stability. Regulators must ensure that their actions support market discipline, avoid potentially adverse impacts on other countries, including regulatory arbitrage, and support competition, dynamism and innovation in the marketplace. Financial institutions must also bear their responsibility for the turmoil and should do their part to overcome it including by recognizing losses, improving disclosure and strengthening their governance and risk management practices.

    9. We commit to implementing policies consistent with the following common principles for reform.

    * Strengthening Transparency and Accountability: We will strengthen financial market transparency, including by enhancing required disclosure on complex financial products and ensuring complete and accurate disclosure by firms of their financial conditions. Incentives should be aligned to avoid excessive risk-taking.

    * Enhancing Sound Regulation: We pledge to strengthen our regulatory regimes, prudential oversight, and risk management, and ensure that all financial markets, products and participants are regulated or subject to oversight, as appropriate to their circumstances. We will exercise strong oversight over credit rating agencies, consistent with the agreed and strengthened international code of conduct. We will also make regulatory regimes more effective over the economic cycle, while ensuring that regulation is efficient, does not stifle innovation, and encourages expanded trade in financial products and services. We commit to transparent assessments of our national regulatory systems.

    * Promoting Integrity in Financial Markets: We commit to protect the integrity of the world's financial markets by bolstering investor and consumer protection, avoiding conflicts of interest, preventing illegal market manipulation, fraudulent activities and abuse, and protecting against illicit finance risks arising from non-cooperative jurisdictions. We will also promote information sharing, including with respect to jurisdictions that have yet to commit to international standards with respect to bank secrecy and transparency.

    * Reinforcing International Cooperation: We call upon our national and regional regulators to formulate their regulations and other measures in a consistent manner. Regulators should enhance their coordination and cooperation across all segments of financial markets, including with respect to cross-border capital flows. Regulators and other relevant authorities as a matter of priority should strengthen cooperation on crisis prevention, management, and resolution.

    * Reforming International Financial Institutions: We are committed to advancing the reform of the Bretton Woods Institutions so that they can more adequately reflect changing economic weights in the world economy in order to increase their legitimacy and effectiveness. In this respect, emerging and developing economies, including the poorest countries, should have greater voice and representation. The Financial Stability Forum (FSF) must expand urgently to a broader membership of emerging economies, and other major standard setting bodies should promptly review their membership. The IMF, in collaboration with the expanded FSF and other bodies, should work to better identify vulnerabilities, anticipate potential stresses, and act swiftly to play a key role in crisis response.

    Tasking of Ministers and Experts

    10. We are committed to taking rapid action to implement these principles. We instruct our Finance Ministers, as coordinated by their 2009 G-20 leadership (Brazil, UK, Republic of Korea), to initiate processes and a timeline to do so. An initial list of specific measures is set forth in the attached Action Plan, including high priority actions to be completed prior to March 31, 2009.

    In consultation with other economies and existing bodies, drawing upon the recommendations of such eminent independent experts as they may appoint, we request our Finance Ministers to formulate additional recommendations, including in the following specific areas:

    * Mitigating against pro-cyclicality in regulatory policy;

    * Reviewing and aligning global accounting standards, particularly for complex securities in times of stress;

    * Strengthening the resilience and transparency of credit derivatives markets and reducing their systemic risks, including by improving the infrastructure of over-the-counter markets;

    * Reviewing compensation practices as they relate to incentives for risk taking and innovation;

    * Reviewing the mandates, governance, and resource requirements of the IFIs; and

    * Defining the scope of systemically important institutions and determining their appropriate regulation or oversight.

    11. In view of the role of the G-20 in financial systems reform, we will meet again by April 30, 2009, to review the implementation of the principles and decisions agreed today.

    Commitment to an Open Global Economy

    12. We recognize that these reforms will only be successful if grounded in a commitment to free market principles, including the rule of law, respect for private property, open trade and investment, competitive markets, and efficient, effectively regulated financial systems. These principles are essential to economic growth and prosperity and have lifted millions out of poverty, and have significantly raised the global standard of living. Recognizing the necessity to improve financial sector regulation, we must avoid over-regulation that would hamper economic growth and exacerbate the contraction of capital flows, including to developing countries. 13. We underscore the critical importance of rejecting protectionism and not turning inward in times of financial uncertainty. In this regard, within the next 12 months, we will refrain from raising new barriers to investment or to trade in goods and services, imposing new export restrictions, or implementing World Trade Organization (WTO) inconsistent measures to stimulate exports. Further, we shall strive to reach agreement this year on modalities that leads to a successful conclusion to the WTO's Doha Development Agenda with an ambitious and balanced outcome. We instruct our Trade Ministers to achieve this objective and stand ready to assist directly, as necessary. We also agree that our countries have the largest stake in the global trading system and therefore each must make the positive contributions necessary to achieve such an outcome.

    14. We are mindful of the impact of the current crisis on developing countries, particularly the most vulnerable. We reaffirm the importance of the Millennium Development Goals, the development assistance commitments we have made, and urge both developed and emerging economies to undertake commitments consistent with their capacities and roles in the global economy. In this regard, we reaffirm the development principles agreed at the 2002 United Nations Conference on Financing for Development in Monterrey, Mexico, which emphasized country ownership and mobilizing all sources of financing for development.

    15. We remain committed to addressing other critical challenges such as energy security and climate change, food security, the rule of law, and the fight against terrorism, poverty and disease.

    16. As we move forward, we are confident that through continued partnership, cooperation, and multilateralism, we will overcome the challenges before us and restore stability and prosperity to the world economy.

    Action Plan to Implement Principles for Reform

    This Action Plan sets forth a comprehensive work plan to implement the five agreed principles for reform. Our finance ministers will work to ensure that the taskings set forth in this Action Plan are fully and vigorously implemented. They are responsible for the development and implementation of these recommendations drawing on the ongoing work of relevant bodies, including the International Monetary Fund (IMF), an expanded Financial Stability Forum (FSF), and standard setting bodies.

    Strengthening Transparency and Accountability

    Immediate Actions by March 31, 2009

    * The key global accounting standards bodies should work to enhance guidance for valuation of securities, also taking into account the valuation of complex, illiquid products, especially during times of stress.

    * Accounting standard setters should significantly advance their work to address weaknesses in accounting and disclosure standards for off-balance sheet vehicles.

    * Regulators and accounting standard setters should enhance the required disclosure of complex financial instruments by firms to market participants.

    * With a view toward promoting financial stability, the governance of the international accounting standard setting body should be further enhanced, including by undertaking a review of its membership, in particular in order to ensure transparency, accountability, and an appropriate relationship between this independent body and the relevant authorities.

    * Private sector bodies that have already developed best practices for private pools of capital and/or hedge funds should bring forward proposals for a set of unified best practices. Finance Ministers should assess the adequacy of these proposals, drawing upon the analysis of regulators, the expanded FSF, and other relevant bodies.

    Medium-term actions

    * The key global accounting standards bodies should work intensively toward the objective of creating a single high-quality global standard.

    * Regulators, supervisors, and accounting standard setters, as appropriate, should work with each other and the private sector on an ongoing basis to ensure consistent application and enforcement of high-quality accounting standards.

    * Financial institutions should provide enhanced risk disclosures in their reporting and disclose all losses on an ongoing basis, consistent with international best practice, as appropriate. Regulators should work to ensure that a financial institution' financial statements include a complete, accurate, and timely picture of the firm's activities (including off-balance sheet activities) and are reported on a consistent and regular basis.

    Enhancing Sound Regulation

    Regulatory Regimes Immediate Actions by March 31, 2009 * The IMF, expanded FSF, and other regulators and bodies should develop recommendations to mitigate pro-cyclicality, including the review of how valuation and leverage, bank capital, executive compensation, and provisioning practices may exacerbate cyclical trends.

    Medium-term actions

    * To the extent countries or regions have not already done so, each country or region pledges to review and report on the structure and principles of its regulatory system to ensure it is compatible with a modern and increasingly globalized financial system. To this end, all G-20 members commit to undertake a Financial Sector Assessment Program (FSAP) report and support the transparent assessments of countries' national regulatory systems.

    * The appropriate bodies should review the differentiated nature of regulation in the banking, securities, and insurance sectors and provide a report outlining the issue and making recommendations on needed improvements. A review of the scope of financial regulation, with a special emphasis on institutions, instruments, and markets that are currently unregulated, along with ensuring that all systemically-important institutions are appropriately regulated, should also be undertaken.

    * National and regional authorities should review resolution regimes and bankruptcy laws in light of recent experience to ensure that they permit an orderly wind-down of large complex cross-border financial institutions.

    * Definitions of capital should be harmonized in order to achieve consistent measures of capital and capital adequacy.

    Prudential Oversight

    Immediate Actions by March 31, 2009

    * Regulators should take steps to ensure that credit rating agencies meet the highest standards of the international organization of securities regulators and that they avoid conflicts of interest, provide greater disclosure to investors and to issuers, and differentiate ratings for complex products. This will help ensure that credit rating agencies have the right incentives and appropriate oversight to enable them to perform their important role in providing unbiased information and assessments to markets.

    * The international organization of securities regulators should review credit rating agencies' adoption of the standards and mechanisms for monitoring compliance.

    * Authorities should ensure that financial institutions maintain adequate capital in amounts necessary to sustain confidence. International standard setters should set out strengthened capital requirements for banks' structured credit and securitization activities.

    * Supervisors and regulators, building on the imminent launch of central counterparty services for credit default swaps (CDS) in some countries, should: speed efforts to reduce the systemic risks of CDS and over-the-counter (OTC) derivatives transactions; insist that market participants support exchange traded or electronic trading platforms for CDS contracts; expand OTC derivatives market transparency; and ensure that the infrastructure for OTC derivatives can support growing volumes.

    Medium-term actions

    * Credit Ratings Agencies that provide public ratings should be registered.

    * Supervisors and central banks should develop robust and internationally consistent approaches for liquidity supervision of, and central bank liquidity operations for, cross-border banks.

    Risk Management

    Immediate Actions by March 31, 2009

    * Regulators should develop enhanced guidance to strengthen banks' risk management practices, in line with international best practices, and should encourage financial firms to reexamine their internal controls and implement strengthened policies for sound risk management.

    * Regulators should develop and implement procedures to ensure that financial firms implement policies to better manage liquidity risk, including by creating strong liquidity cushions.

    * Supervisors should ensure that financial firms develop processes that provide for timely and comprehensive measurement of risk concentrations and large counterparty risk positions across products and geographies.

    * Firms should reassess their risk management models to guard against stress and report to supervisors on their efforts.

    * The Basel Committee should study the need for and help develop firms' new stress testing models, as appropriate.

    * Financial institutions should have clear internal incentives to promote stability, and action needs to be taken, through voluntary effort or regulatory action, to avoid compensation schemes which reward excessive short-term returns or risk taking.

    * Banks should exercise effective risk management and due diligence over structured products and securitization.

    Medium -term actions

    * International standard setting bodies, working with a broad range of economies and other appropriate bodies, should ensure that regulatory policy makers are aware and able to respond rapidly to evolution and innovation in financial markets and products.

    * Authorities should monitor substantial changes in asset prices and their implications for the macroeconomy and the financial system.

    Promoting Integrity in Financial Markets

    Immediate Actions by March 31, 2009

    * Our national and regional authorities should work together to enhance regulatory cooperation between jurisdictions on a regional and international level.

    * National and regional authorities should work to promote information sharing about domestic and cross-border threats to market stability and ensure that national (or regional, where applicable) legal provisions are adequate to address these threats.

    * National and regional authorities should also review business conduct rules to protect markets and investors, especially against market manipulation and fraud and strengthen their cross-border cooperation to protect the international financial system from illicit actors. In case of misconduct, there should be an appropriate sanctions regime.

    Medium -term actions

    * National and regional authorities should implement national and international measures that protect the global financial system from uncooperative and non-transparent jurisdictions that pose risks of illicit financial activity.

    * The Financial Action Task Force should continue its important work against money laundering and terrorist financing, and we support the efforts of the World Bank – UN Stolen Asset Recovery (StAR) Initiative.

    * Tax authorities, drawing upon the work of relevant bodies such as the Organization for Economic Cooperation and Development (OECD), should continue efforts to promote tax information exchange. Lack of transparency and a failure to exchange tax information should be vigorously addressed.

    Reinforcing International Cooperation

    Immediate Actions by March 31, 2009

    * Supervisors should collaborate to establish supervisory colleges for all major cross-border financial institutions, as part of efforts to strengthen the surveillance of cross-border firms. Major global banks should meet regularly with their supervisory college for comprehensive discussions of the firm's activities and assessment of the risks it faces.

    * Regulators should take all steps necessary to strengthen cross-border crisis management arrangements, including on cooperation and communication with each other and with appropriate authorities, and develop comprehensive contact lists and conduct simulation exercises, as appropriate.

    Medium -term actions

    * Authorities, drawing especially on the work of regulators, should collect information on areas where convergence in regulatory practices such as accounting standards, auditing, and deposit insurance is making progress, is in need of accelerated progress, or where there may be potential for progress.

    * Authorities should ensure that temporary measures to restore stability and confidence have minimal distortions and are unwound in a timely, well-sequenced and coordinated manner.

    Reforming International Financial Institutions

    Immediate Actions by March 31, 2009

    * The FSF should expand to a broader membership of emerging economies.

    * The IMF, with its focus on surveillance, and the expanded FSF, with its focus on standard setting, should strengthen their collaboration, enhancing efforts to better integrate regulatory and supervisory responses into the macro-prudential policy framework and conduct early warning exercises.

    * The IMF, given its universal membership and core macro-financial expertise, should, in close coordination with the FSF and others, take a leading role in drawing lessons from the current crisis, consistent with its mandate.

    * We should review the adequacy of the resources of the IMF, the World Bank Group and other multilateral development banks and stand ready to increase them where necessary. The IFIs should also continue to review and adapt their lending instruments to adequately meet their members' needs and revise their lending role in the light of the ongoing financial crisis.

    * We should explore ways to restore emerging and developing countries' access to credit and resume private capital flows which are critical for sustainable growth and development, including ongoing infrastructure investment.

    * In cases where severe market disruptions have limited access to the necessary financing for counter-cyclical fiscal policies, multilateral development banks must ensure arrangements are in place to support, as needed, those countries with a good track record and sound policies.

    Medium -term actions

    * We underscored that the Bretton Woods Institutions must be comprehensively reformed so that they can more adequately reflect changing economic weights in the world economy and be more responsive to future challenges. Emerging and developing economies should have greater voice and representation in these institutions.

    * The IMF should conduct vigorous and even-handed surveillance reviews of all countries, as well as giving greater attention to their financial sectors and better integrating the reviews with the joint IMF/World Bank financial sector assessment programs. On this basis, the role of the IMF in providing macro-financial policy advice would be strengthened.

    * Advanced economies, the IMF, and other international organizations should provide capacity-building programs for emerging market economies and developing countries on the formulation and the implementation of new major regulations, consistent with international standards.  

    According to Lula, everyone knows that the crisis is not going to end tomorrow, "but the signs that the presidents are sending to society, to the world, is that we are going to operate in a more political and cohesive way and that we are going to work collectively the most delicate themes collectively. This a  very important breath of enthusiasm and a very large dosage optimism for the world living in crisis."

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    • Show Comments (12)

    • Lloyd Cata

      Lula, Bolivia, and
      JoÀƒ£o,

      I have always expressed admiration for President Lula, although he has tried -IMHO- to chart a middle course in the domestic
      situation when I would have preferred a bolder approach. For example; he allowed his political cronies to corrupt the Fomme
      Zero program. He failed to use his ‘presidency’ to stop corruption in his own party. I really believe he wanted to do better
      on this, and I think later, maybe in his memoirs, he will admit this as one of his regrets. Fomme Zero was for me Lulas
      commitment to rebuilding Brazil from the ground up. At least a first step and acknowledgement that in a society with so much
      agricultural wealth hunger was not acceptable. There was much excitement, even in the business community, until it became
      just another political corrupution scheme. I still hope that after his presidency he will return to this ideal much the same
      way that President Carter has done with Habitat for Humanity here in the US and around the world. Unfortunately, we do not
      see the commitment to their ideals when they are in office, and it does not matter what leader, ideology, or country this is
      a clear example that politics is a practice removed from the interests of the people. Imagine what could be done if those
      ideals and commitments could be realized while in the presidency! Lula had an opportunity to break with the past in this
      respect and genuinely join with the private sector in changing the lives of millions of Brasileiros. The private sector was
      certainly ready to help Lula in this effort, but lost interest after seeing Fomme Zero become another corrupt political
      platform. This is as much a ‘crime against humanity’ as any other war crimes. The living death of hunger and disease has
      been increased because Mr. Lula failed to select honest people to run the program and then failed to punish, severely, those
      who corrupted the program. The private sector and business community will still help if asked, but a real enthusuiasm that
      first greeted the program is lost for the present.
      Internationally, President Lula has indeed led the emergence of the developing nations in the struggle against globalization
      and imperial hegemony. While careful not to alienate the capitalist money markets, he has championed fair trade and the
      growth of Mercosul as a trading entity equal to the US and EU. His conservative approach to IMF and World Bank agendas has
      advanced his bid for a seat at the table of international finance and markets. He has not shied away from the responsibility
      of Brazil as the prize and the hope of Latin America. For this reason alone he is indeed the right leader, at the right
      time. Stability has been the focus of his tenure, even at the risk of appearing timid and ineffective, which I have noted
      here many times. Excusable only in light of the challenges and power of those beyond his control. If there is one area where
      he has mis-stepped it is with respect to Haiti. The present involvement of Brazilian troops in Haiti is an abomination, an
      occupation, and totally consistent with US empirical policy throughout the Third World. This is not the first time Brazil
      has allowed itself to be used as an instrument of Empirical designs. As Latin America looks to Brazil for leadership, also
      the nations of the Caribbean look to Brazil for understanding and assistance. As it stands Brazil is simply an occupier and
      enforcer of US and European policy in the region. This is not the first time Brazil has been used in this fashion, which
      brings me to the subject of Bolivia …

    • Lloyd Cata

      Homework
      [b]ch.c[/b]
      Remember, my friend that I did warn you on the economy; specifically the “housing bubble” in the US. Why are you down 13% ?
      I told you the US economy was going to collapse and you still insist on US economic strategy. Is it really the best choice to continue to finance the party on Wall St.? Let me ask you this, “Look in your shopping basket. Wouln’t you have been better off investing in some poor, struggling, but hardworking farmer?” Washington has just thrown $700 BILLION down a rat-hole. They will gladly add any more of your money to the party. Those are expensive eggs on your face, my friend…and getting more expensive every day. Didn’t I tell you that the US would “export inflation” in order to retain the value of the dollar?
      b]Now go and prosper.[[/b]

    • Lloyd Cata

      If not Lula….?
      Given that President Lula is the most respected leader in Latin America and maybe the world, is Brazil prepared to remove him for someone unknown to the world? The challenges facing Brazil are too serious for a leader who cannot appeal to world opinion.
      The real progress Brazil has achieved during Mr. Lula’s tenure could be seriously jeopardised by a new leader wishing to ‘make his mark’ on the economy and the public opinion. There are war clouds on the horizon. The East-West conflict will certainly be played out in Latin America this time. The prize is enormous, the leadership is weak and corrupt, and fear makes for huge weapons purchases; some already in the pipeline. I have tried many times to explain that there are profits in chaos.
      Colombia is the key for the US and Venezuela is the opportunity for the Russians, both sitting on your doorstep. Can it be in both their interests to promote a war in South America? This pie only needs some sugar and as I’ve said many times, the real prize is chaos in Brazil. Mercosur right now is an economic alliance, but it surely needs a military alliance like NATO. Can a new Brazilian leader navigate these waters?

    • João da Silva

      [quote]I have criticised Mr. Lula in the past for being too timid. We shall see if he can lead a new chapter in the wealth of nations.[/quote]

      He does not have much time left to lead a “New Chapter”, unless you are suggesting that we give more time by electing him for a third mandate.

    • Lloyd Cata

      Americans drink coffee…don’t drink the Koolaid!
      Humility indeed…lmao 😀
      Simply an overdue admission that these overgrown pigs(G8) desperately need the resources of the developing nations to prop up their failed economic agendas. Since the beginning of their colonialist practices to take, by force, what was not theirs this is simply a new agenda to leverage their failed economies with the resources of a larger pie. They did not invite you for tea, instead to bake you into a larger pie…and we know how much they love pie since the US uses 25% of the worlds energy and has only 5% of the population. Some actually believe that slavery was a good thing in light of the US election…see that is Jonestown koolaid for sure.
      It is nice to be invited to the party as long as you do not become the pinata. However, the inclusion of the developing nations does signal a break in the Trade Negotiations(DOHA, WTO, etc) which allows the developing nations better leverage. In that case Mercosur is the clear winner of the world financial crisis.
      I have criticised Mr. Lula in the past for being too timid. We shall see if he can lead a new chapter in the wealth of nations. Fortunately, with the election of Mr. Obama, there will never be a better time. But time is short and convincing corrupt politicians to “do the right thing” is not easy. As the election in the US has shown;”the people are ready”!

    • João da Silva

      Ch.C
      One thing I liked about the posture of the newly elected POTUS is that he did not want to participate in this encounter of G-19 in Washington D.C. Instead, he opted to spend the week end in Chicago. So many “leaders” of G-19 wanted to meet him, but he politely declined to meet any of them, thus proving the old proverb “Keep the turkeys in suspense”. I fully approve of his attitude, even though you might not.

      Having said it, I thought your fellow European Sarko was somewhat of a clown. Also I observed that his heart-throb Angela was as clueless as he was. If I am not mistaken, she seems to be a typical “Solteirona” as she acted like one. I really do not understand how she and Sarko got elected, BUT…BUT…, dumb asses get elected all over the world. It is not the exclusive privilege of the Brasilian politicos.

      Now I look forward to Anglela meeting Obama. 😉

    • observer

      Was Lula not “Mr Decouple” a few weeks ago??? He should be drinking this tea!

    • João da Silva

      [quote]BY THE WAY when dose LULU LEAVE? [/quote]

      Supposed to leave on Dec 31, 2010. But the question is: “Is he going to ?”

    • ch.c.

      The Financial Action Task Force should continue its important work against money laundering and terrorist financing, and we support the efforts of the World Bank – UN Stolen Asset Recovery (StAR) In
      Then Americas. South and North, Asia South and North, all of Europe, all of Africa have a lot of work fo their millions of money launderers and tax evaders !

      And what is Brazil going to do with their corruptions practices where most of the money is laundered and tax evaded…MOSTLY IN MIAMI AND NEW YORK BANKS ???????

      And what about ITAU Bank in the…BAHAMAS…and elsewhere ???????? And Cosan….registered in the…BERMUDES ?????

      AND WHAT ABOUT THE RUSSIANS OLIGARCHS ALL MULTI BILLIONAIRES…..having most of their money in…… UK BANKS ???????
      Putin and Medevev are quite anxious to get some of that money back…so that it can be redistributed to his own crownies and afford another part to develop more powerful tanks, jet fighters, nuclear submarines !!!!!

      😉 😀 😉 😉 😀 😉 😉 😀 😉

    • JAY GLENN

      LAME DUCK COMMERENCE
      TALK EVEN IF IT CAN DO NO GOOD.

      THE President of the USA, George Bush leaves office in January, He has no say in what will happen in 2009.
      The President of the EU Leaves office December 31 2008. He has no say in 2009.

      Did this big BS20 consider talking to Ronald Reagan, Abe Lincoln, King of France,
      Or other dead and gone leaders?

      BY THE WAY when dose LULU LEAVE?
      😛 😛

    • ch.c.

      We are determined to enhance our cooperation and work together
      Certainly dead wrong !
      ALL developed nations and most large emerging nations cuts their interests rates. BRAZIL CUT BY ZERO !

      ABOUT THE HUMILITY TEA :
      Doubtful it was a humility tea from the developed nations side, but why not from the emerging nations side.
      Afterall, you are full of forfeign currencies, but dont want to lose them by lending them TO YOUR OWN COMPANIES !

      ON TRADE :
      – All emerging nations have HUGE trade surplus with the developed nations, but…but….that is NOT ENOUGH….in your views.
      – Your borders are more closed to our goods than your goods are closed to our borders. Prove is YOUR TRADE SURPLUS WITH THE DEVELOPED NATIONS.
      – YOUR OVERALL IMPORT TAXES IN DOLLARS AMOUNTS ARE GREATER FROM DEVELOPED NATIONS THAN OUR OVERALL IMPORT TAX FROM EMERGING NATIONS ! bUT…THAT IS NOT ENOUGH….in your views.
      – Basically everything your produce, including grains, can be produced in sufficient quantity in developed nations. Including soyabeans in the USA, that could fill the Europe and Japan needs ! WHILE THE OPPOSITE IS JUST AS TRUE : YOU CANT PRODUCE EVERYSTHING WE PRODUCE SUCH AS IN TECHNOLOGY, FINANCIAL PRODUCTS, SERVICES, R&D, DRUGS, LENDING, ETC ETC !!!!!
      – Most emerging nations are subsidizing nearly ALL THEIR INDUSTRIES but you criticize the developed nations to subsidizes ONLY THEIR AGRICULTURE !

      EVEN AT THE LATEST WTO, THE REAL REST PROVIDED ITS RESULTS : it was China, India and Argentina who said they want to PROTECT THEIR FARMERS !!!!!! And on top of that you were not ready for further concessions on the non agricultural sectors…OF COURSE !!!!!

      WELLLLL…..THAT IS YOUR TRICK FOR UNFAIR TRADE WITH DEVELOPED NATIONS.

      Because of course none of the emerging nations finger pointed the other emerging nations that THEY subsidizes nearly ALL their
      industries, including imported consumption such as…GASOLINE/DIESEL at your pumps station, or natural gas for your enterprises that 100 % of your society benefits from poors to the ultra wealthy !
      Let alone your administration huge machinery providing well paid jobs and generous retirements benefits for millions of unproductive bureaucrats and thus leaving very little for your infrastructure developments and then syour governments in need foreign financings !!!!!!

      And I remain far more bullish long term for the developed nations, because they do invest for the future through their VASTS INVESTEMENTS IN R&D laboratories, while emerging nations of course DONT !
      Not doing so, will always make you lagging !
      Your commodities production and semi-manufactured or cheap goods will continue to grow in volume, but certainly not when expressed in US$ long term ! Your currencies will continue to lose their value on a secular basis with either fast or slow depreciations ! And when there will be emerging nations currencies appreciations, it will remain a secular bear market rally…and nothing else ! Idiots will be sure…it is for real….THIS TIME…OR NEXT ! INEXORABLY YOU WILL END UP WRONG.
      And you can already see this in some emerging nations currencies : MANY ARE NOT THAT FAR FROM THEIR HISTORICAL RECORD…LOWS !!!! And you havent seen anything…yet ! Many emerging nations currencies will end up 2009 at an HISTORICAL RECORD LOW ! Of course some MUCH lower than others !
      I dont specifically pin point Brazil, but by not allowing your currency to depreciate, you will have more competition and competitive price….FROM OTHER EMERGING NATIONS ! And not opening your borders to more goods grom other emerging nations, you will also have more problems exporting to them !
      Brazil wants to take both the developed and the other emerging nations for a ride. IT WONT WORK.
      The others (developed and emerging nations) are not as idiots as you expect and wish them to be !

      Your today’s friends are your tomorrow’s enemies….on the trade side !
      And your today’s enemies wont necessarily be your tomorrow’s friends.
      But the developed nations will continue to support BRAZIL, CHINA AND INDIA, MEXICO AND SOUTH KOREA.
      It is better to keep ALL emerging nations ALIVE…so that they will continue to keep prices low, one against each other ! Just provide them with the tools (including money) to produce. They will undercut themselves through competition and over production !
      And we will continue to provide you with the newer tools with fat profits ! Because without fat gross margins, we could not finance our R&D !
      Never thought about that ?
      The simplest example is GRAINS ! As I said a few times a while ago, if someone is bullish on grains…BUY MONSANTO, SYNGENTA, DEERE, and fertilizers POTASH and MOSAIC! These stocks went up a lot more from 2002/3 LOWS to the top in 2008…. than grains prices.
      A HELL OF A LOT MORE !!!!! From 400 % to 2000 % ! What is the grains names that did as well ???????

      Hey Hey proven….once more !

      😀 😉 😀 😉 😀 😉 😀 😉 😀 😉 😀 😉 😀 😉 😀 😉

    • forrest allen brown

      they should havd drank hemlock we would all be better for it
      National and regional authorities should implement national and international measures that protect the global financial system from uncooperative and non-transparent jurisdictions that pose risks of illicit financial activity.

      * The Financial Action Task Force should continue its important work against money laundering and terrorist financing, and we support the efforts of the World Bank – UN Stolen Asset Recovery (StAR) Initiative.

      like this is going to happen

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