[Guardian Unlimited, U.K.]

 

 

Financial Times Deutschland, Germany

Cowboy Capitalism to Sheriff Capitalism

 

"The U-turn is so abrupt and radical that it's causing many to stumble, both on the left and the right. … The convenient rallying cry that the market requires much stricter rules but that the Americans are blocking everything has from this day been exhausted."

 

EDITORIAL

 

Translated By Jonathan Lobsien

 

March 28, 2009

 

Germany - Financial Times Deutschland - Original Article (German)

Timothy Geithner: The U.S. treasury secretary has heads spinning on both sides of the Atlantic.   BBC NEWS AUDIO: U.S. Treasury Secretary Timothy Geithner has set out plans for much tougher regulation of American banks. Should Europe follow?, Mar. 26, 00:13:04

The U-turn is so abrupt and radical that it's causing many to stumble, both on the left and the right. U.S. Treasury Secretary Timothy Geithner has announced no less than a fundamental break with the past philosophy of the Americans in matters of financial market regulation.

 

Up until now, the rule of thumb in Washington was that when in doubt, the best regulation is soft regulation - or no regulation at all. In addition, President Barack Obama’s new team has until recently resisted all attempts by the Europeans to give the State a tight grasp over financial markets and their actors.

 

Geithner has now presented a reform package to Congress that turns the old logic on its head. Strict government control shall henceforth be the norm, directed by a single super-agency that has all the levers to aggressively illuminate the risk-laden shadow realms of the financial world.  

Posted by WORLDMEETS.US

 

What's left of this package at the end of the lengthy legislative process is of course open to question. And no one should expect that this will exclude every future problem. But ultimately, the many existing oversight agencies failed terrifically. Their sheer incompetence and lack of attentiveness contributed significantly to allowing the build-up of such explosive risk.

 

In the future, financial artists will still be able to flee to unregulated offshore locations. But the fundamental change of heart in Washington will make it easier to develop common regulatory standards for major national economies. Geithner's plan is also an excellent sign for the G20 summit in London: Washington is explicitly obliging the Europeans.

 

SEE ALSO ON THIS:

Corriere della Sera, Italy: 'Lost Smiles' as Obama Prepares for Europe

Financial Times Deutschland, Germany: China and U.S.: Europe Should Fear G2, Not G20

Le Figaro, France: Obama and Sarkozy: Clashing Views That Need Not Be Fatal

Elsevier, The Netherlands: No More 'Care Packages' for Obama

Guardian Unlimited, U.K.: Britain Clears Decks for 'Barack Obama Show'

The Times, U.K.: Blaming 'Anglo-Saxons,' Sarkozy Threatens to Walk Out of G-20

 

The joy of the E.U. governments will not, however, go entirely untarnished: After the Americans have given in on the dispute over regulation, in London they will all the more energetically demand that Europe now move and do more to stimulate the global economy.

 

Moreover, after a common regulatory philosophy is settled on, there will be a long list of far more difficult questions to address. The convenient rallying cry that the market requires much stricter rules but that the Americans are blocking everything has from this day been exhausted.

 

CLICK HERE FOR GERMAN VERSION

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Posted by WORLDMEETS.US March 30, 9:28pm]