Comments on: Davos debate: How to fix finance? http://blogs.reuters.com/great-debate/2009/01/26/davos-debate-how-should-international-finance-be-reformed/ Thu, 21 Jul 2016 07:57:19 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: cliff http://blogs.reuters.com/great-debate/2009/01/26/davos-debate-how-should-international-finance-be-reformed/#comment-7712 Wed, 11 Feb 2009 19:37:14 +0000 http://blogs.reuters.com/great-debate/?p=1587#comment-7712 Dear Sir,
I have been putting some thought to the current global financial crisis and would like to put forward to you a hypothesis for consideration, if it is a viable solution to the increasingly catastrophic situation the global financial system is currently experiencing.
It is about time that someone came up with some constructive thoughts and started to look at the ‘credit crunch / recession /depression) as an entirely global problem that is not going to improve in anything like the near future.

Global problems require global solutions and the only REAL solution is to tackle the problem on a global scale.

Consider this hypothesis – the only way to revive the world economy is to instill confidence in the public mind, give investors something to invest in!

Banks and bankers cannot do this anymore nobody trusts them

The answer is to respond to the masses in such a way that they have the power to bring the world economy back on track.

Bring confidence back and it will turn around very quickly, the burning question is HOW?

A simple solution is available, provided that the world financial systems and all governments work as one entity for one goal.

THE SOLUTION IS SIMPLE IN CONCEPT BUT DIFFICULT TO RESOLVE WITHOUT 100% GLOBAL COOPERATION AND METICULOUS PLANNING TO IMPLEMENT THE CHANGEOVER TO REVALUED CURRENCIES AND ALL FINANCIAL TRANSACTIONS ADJUSTED TO THE NEW LEVEL.

Close down all financial dealings for 48 hours

The concept is to take all global assets, everything but hard cash and reduce the value to one tenth

Next take all cash assets and multiply value by ten

(this would require revaluation of every world currency) yes print new money

This would create wealth for every man and women in the world overnight and create a differential of 100 times between asset values and cash values globally and therefore will not have any inflationary impact whatsoever.

after 48 hours all transactions would recommence with all assets a tenth of what they were before, but cash assets having being multiplied by ten they would be worth 100 times more. However the status quo of assets, wages, prices, etc., relatively, will remain the same.

The windfall from the change gives revenue back to the people to spend but have 100 times more spending power. Costs of assets are slashed and the cash assets allow people to buy houses and spend while still maintaining the original differential as the revaluation is totally global therefore there will be no difference in the relative values of assets compared to incomes.

If such a plan was considered and published globally it would almost certainly create confidence, in fact ity may even improve the world economy before it is applied. Just the knowledge of global improvement may give the kick-start the banking bail-out strategy has not.

I am an engineer, not an economist, I look for solutions to problems every day.

Regards,

CG London

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By: MrBill, Eurasia http://blogs.reuters.com/great-debate/2009/01/26/davos-debate-how-should-international-finance-be-reformed/#comment-6951 Mon, 02 Feb 2009 10:19:02 +0000 http://blogs.reuters.com/great-debate/?p=1587#comment-6951 We first step towards reducing global financial balances and therefore reducing financial instability is to acknowledge that we cannot all grower faster than trend. We cannot all be better than average. Keynesian policies on steroids known as non-Ricardian fiscal policies are the source of global financial imbalances characterized as persistant current account deficits on one hand with currency manipulation to remain export competitive on the other. It works in the short-term, but longer term it shows up as unsustainable financial imbalances, a misallocation of resources, and exacerbates the boom and the bust of the business cycle as there are fewer natural mechanisms for self-rigthing those imbalances. Reduce your global financial imbalances and markets will be less prone to violent corrections.

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By: Simon Smelt http://blogs.reuters.com/great-debate/2009/01/26/davos-debate-how-should-international-finance-be-reformed/#comment-6917 Sun, 01 Feb 2009 21:21:46 +0000 http://blogs.reuters.com/great-debate/?p=1587#comment-6917 The answer is both absurdly simple and hard to do.
The U.S. has abused its position as providing the world’s reserve currency. It continues to extract the maximum possible rent from this through cheap debt.
Dethrone the U.S. $ and there will be an end to huge global imbalances, debt binges etc. Of course, hard to do both in terms of what will replace it and the transition. But anything else is just hot air. Tackle the fundamental problem.

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By: Harry http://blogs.reuters.com/great-debate/2009/01/26/davos-debate-how-should-international-finance-be-reformed/#comment-6757 Sat, 31 Jan 2009 06:59:48 +0000 http://blogs.reuters.com/great-debate/?p=1587#comment-6757 another clue to holistic economic equilibrium and stability … the capitalist system has great dynamic merit relying on fair competition.. privatization of some entities works other don’t … some elements work better with a socialist model … education and health as a birth right not a brutal unfair battle breeding social resentments.

positive working fundamentals are there but for the holistic global model to work properly , needed is a return of some business entities to stable government control … the proven capital free markets that build stable connections create the expansion dynamics … proven beneficial foundations sponsored by tax incentives getting wider use …. once a positive flow through to the whole of humanity is acheived stable equilibrium will be found .

for this to happen all the wasted arguments or blame games must be replaced by clearly presented communication towards co-operation.

the other benefit found world peace … not just a dream .

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By: Brad Anderson http://blogs.reuters.com/great-debate/2009/01/26/davos-debate-how-should-international-finance-be-reformed/#comment-6684 Fri, 30 Jan 2009 17:48:01 +0000 http://blogs.reuters.com/great-debate/?p=1587#comment-6684 Davos delegate comment: Best Buy CEO

[youtube]http://uk.youtube.com/watch?v=X OYOXolPbIA[/youtube]

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By: ingrid http://blogs.reuters.com/great-debate/2009/01/26/davos-debate-how-should-international-finance-be-reformed/#comment-6650 Fri, 30 Jan 2009 14:42:09 +0000 http://blogs.reuters.com/great-debate/?p=1587#comment-6650 Limit, by law, the amount of money any one CEO can earn. The stockhoders should get a percentage of the take. I agree with comment – January 29th, 2009 10:57 pm GMT – Posted by jal

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By: Anonymous http://blogs.reuters.com/great-debate/2009/01/26/davos-debate-how-should-international-finance-be-reformed/#comment-6606 Fri, 30 Jan 2009 05:59:47 +0000 http://blogs.reuters.com/great-debate/?p=1587#comment-6606 Davos 2009 Conference Shows The World At An Economic Crossroads……
http://wcgfairfield.blogspot.com/2009/01  /davos-2009-conference-shows-world-at.h tml

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By: Leric Goodman http://blogs.reuters.com/great-debate/2009/01/26/davos-debate-how-should-international-finance-be-reformed/#comment-6604 Fri, 30 Jan 2009 05:53:56 +0000 http://blogs.reuters.com/great-debate/?p=1587#comment-6604 It should be clear to everyone that we need an international set of standards administered by one internationally recognized organization or, alternatively, harmonized sets of national standards administered nationally, which will: (1) define “securities” to include derivatives, credit default swaps, and anything else which is dependent upon performance for realization of value, (2) register securities so that complete and accurate information is available quickly and easily on each security and its risks, (3) evaluate issuers of securities to rate the likelihood of performance, and (4) evaluate prospective purchasers of securities to make sure that offerings are made to and sales consummated only to purchasers who (a) understand what they are buying and (b) can bear the risk.

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By: Yien Phe http://blogs.reuters.com/great-debate/2009/01/26/davos-debate-how-should-international-finance-be-reformed/#comment-6603 Fri, 30 Jan 2009 05:42:37 +0000 http://blogs.reuters.com/great-debate/?p=1587#comment-6603 My first suggestion for the US is that instead of investing Social Security money in the T-Bills w/ 2%+ returns, we should invest of those money in buying Fannimae’s new loan w/ strickly 80% of the colaterals and “full doc”. By doing that we can lower the 30yrs mortgage rates to 4.5% or better while increasing Social Security funds’ returns w/ much almost double. Secondly, the Fed and law makers should never have bail-out banks but let it runs its course. There will not be bank-run because depositors are protected by FDIC for $100k, which has been increased to $300k recently. $700bil should be helping to stop foreclosures. I hope Americans don’t have to go on street like French citizens do, whom I admired their courage and understanding of the seriousness of the bailout problem.
Good Luck Americans and may God bless America, before it is too late.

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By: Dan http://blogs.reuters.com/great-debate/2009/01/26/davos-debate-how-should-international-finance-be-reformed/#comment-6600 Fri, 30 Jan 2009 05:18:25 +0000 http://blogs.reuters.com/great-debate/?p=1587#comment-6600 If you don’t mind me asking:
What exactly is being taught at the schools and universities that make business leaders and accountants have a never ending desire for money, to the point of destroying everything around them?

What ethics and morals come along with degrees in finance and accounting?

What sort of friendships are made and who enables their anti-social desire and fires up their ambition beyond reason?

Why is it that pride in your nationality and desire to do good to your society are not seen as qualities?

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