Tuesday, February 05, 2008

Save the G8 Summit!

Some numbers to ponder, from Brad Setser's blog:

Counting the funds Kuwait and Korea committed to Merrill and Singapore and Kuwait committed to Citi, sovereign funds have provided US and European banks about $42b in new capital over the past two quarters.

That tops the $30b the IMF lent out over a four quarter period in the Asian/ Russian crisis of 1997-1998, and is roughly the same size as the $40b or so the IMF lend out to Argentina, Brazil, Turkey and Uruguay over a two year period in 2001-2002...
Ah! To be the best loved ally of the world's greatest debtor nation, whose president has just produced a budget with a real on-on-line deficit of of $738 billion dollars, a heck of a lot more (technical term) than original estimates.

Meanwhile the Fukuda government has indicated it will be inviting "non-G-8" countries to the Toyako Summit in July. I suppose some of the invitees will be given special badges with the word "Participant" crossed out and the word "Owner" written over it in felt tip pen.

Question is will they bother to come? After all, who wants to hang out with a bunch of slow-growth or no-growth deadbeats who have an abysmal record of corporate governance and political development?

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