Katarina Nolte

Conservative French President Nicolas Sarkozy Wants a Moralization of Capitalism

“French President Nicolas Sarkozy walked into the lion’s den of capitalism in Davos Wednesday and rammed his message of reform down the throats of the world’s bankers and chief executives.

In his keynote address to the 2010 World Economic Forum (WEF), the French leader said globalization skidded out of control and that a complete rethink of the capitalist system was required.

As he slammed excessive bank bonuses - one of the most explosive issues for many people - he endorsed a reform plan from his U.S. counterpart Barack Obama that includes limits on the size of banks, curbs on rewards and restrictions on riskier trading.

… the president is saying if others don’t do it, France will still do it.”

“The French president argued that market forces needed to be offset by corrective measures.

Sarkozy attacked mark-to-market accounting practices. He also made a thinly-veiled attack on China’s policy of keeping its currency low. He said the undervaluation of certain countries’ currencies constituted “monetary dumping” and called for a new Bretton Woods system.
He promised to push forward the idea of reforming the global finance in 2011, when France will chair both the G8 and the G20.”

“The dollar has depreciated substantially relative to other currencies since May of 2009.
Since the renminbi is tied again to the dollar, the renminbi has depreciated by the same amounts, including 16% against the euro, 34 % against the Australian dollar, 25% against the Korean won, and 10 % against the Japanese yen.

The US and other countries worry that the undervaluation of the Chinese currency increases the demand for Chinese exports, and reduces China’s demand for imports from countries like the US because China keeps the dollar and the currencies of other countries artificially expensive relative to their currency.

Indeed, in good part due to the low value of its currency, China has run substantial surpluses on its current trade account as it imports fewer goods and services than it exports.
The result is that China has accumulated enormous reserves of assets in foreign currencies, especially in the form of US government assets denominated in dollars.
As of September of this year, China had the incredible sum of over 2 trillion dollars in foreign currency reserves, such as US Treasury bills.
This is by far the highest reserve in the world, and it amounts to the enormous ratio of more than one quarter of China’s GDP of about $8 trillion (purchasing power parity adjusted).”

“The French president declares that capitalism can be made kinder and more humane.”

“The engine driving the great “American Economic Empire” for 233 years will collapse, a total disaster, a destiny we created.

You know something’s very wrong:
A year ago, too-greedy-to-fail banks were insolvent, in a near-death experience.
Now, magically, they’re back to business as usual, arrogant, pocketing outrageous bonuses while Main Street sacrifices, and unemployment and foreclosures continue rising as tight credit, inflation and skyrocketing federal debt are killing taxpayers.

Wall Street has lost its moral compass. It created the mess, but now, like vultures, Wall Streeters are capitalizing on the carcass. They have lost all sense of fiduciary duty, ethical responsibility and public obligation.

Here are the Top 20 reasons American capitalism has lost its soul:”

Tagged: economycapitalismglobalization