Sunday, November 16, 2008

Nearly nine years after the WTO the world economic powers cave in on neoliberalism

Humbled US agrees to share world's financial top billing, from Australia via Rawstory:

"Under the plans outlined by the leaders, countries such as China, Brazil and India will gain greater roles and responsibilities in a restructuring of the international financial system, while European leaders won a commitment to new regulations and controls on banks, rating agencies and exotic financial securities.

The leaders also agreed that a dramatic failure of market checks in "some advanced countries" was among the root causes of the financial crisis, an implicit rebuke of the US.


The leaders agreed to set up a new regulatory body, "a college of supervisors", to examine the books of major financial institutions that operate across national borders, so regulators could begin to have a more complete picture of banks' operations. They demanded greater scrutiny of hedge funds and the completion of a clearing house system to help standardise and limit risk on some of the opaque financial derivatives that helped bring down Wall Street's investment banks.

Leaders also agreed to submit their countries' financial systems to regular, vigorous reviews by the International Monetary Fund — assessments that some countries, including the US, had long resisted. And they urged new constraints on pay schemes at financial companies that "reward excessive short-term returns or risk-taking"."


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